```

[Federal Register Volume 79, Number 27 (Monday, February 10, 2014)]
[Rules and Regulations]
[Pages 7745-7844]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2014-02356]

[[Page 7745]]

Vol. 79

Monday,

No. 27

February 10, 2014

Part II

Department of Energy

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10 CFR Part 431

Energy Conservation Program: Energy Conservation Standards for Metal 
Halide Lamp Fixtures; Final Rule

Federal Register / Vol. 79, No. 27 / Monday, February 10, 2014 / 
Rules and Regulations

[[Page 7746]]

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DEPARTMENT OF ENERGY

10 CFR Part 431

[Docket Number EERE-2009-BT-STD-0018]
RIN 1904-AC00

Energy Conservation Program: Energy Conservation Standards for 
Metal Halide Lamp Fixtures

AGENCY: Office of Energy Efficiency and Renewable Energy, Department of 
Energy.

ACTION: Final rule.

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SUMMARY: The Energy Policy and Conservation Act of 1975 (EPCA), as 
amended, prescribes energy conservation standards for various consumer 
products and certain commercial and industrial equipment, including 
metal halide lamp fixtures (MHLFs). EPCA also requires the U.S. 
Department of Energy (DOE) to determine whether more-stringent 
standards would be technologically feasible and economically justified, 
and would save a significant amount of energy. In this final rule, DOE 
is adopting more-stringent energy conservation standards for MHLFs. It 
has determined that the new and amended energy conservation standards 
for this equipment would result in significant conservation of energy, 
and are technologically feasible and economically justified.

DATES: The effective date of this rule is April 11, 2014. Compliance 
with the new and amended standards established for MHLFs in today's 
final rule is required by February 10, 2017.
    The incorporation by reference of certain publications listed in 
this rule is approved by the Director of the Federal Register on April 
11, 2014.

ADDRESSES: The docket, which includes Federal Register notices, public 
meeting attendee lists and transcripts, comments, and other supporting 
documents/materials, is available for review at regulations.gov. All 
documents in the docket are listed in the regulations.gov index. 
However, some documents listed in the index, such as those containing 
information that is exempt from public disclosure, may not be publicly 
available.
    A link to the docket Web page can be found at: http://www1.eere.energy.gov/buildings/appliance_standards/rulemaking.aspx/ruleid/16. The regulations.gov Web page will contain simple 
instructions on how to access all documents, including public comments, 
in the docket.
    For further information on how to review the docket, contact Ms. 
Brenda Edwards at (202) 586-2945 or by email: 
Brenda.Edwards@ee.doe.gov.

FOR FURTHER INFORMATION CONTACT: Ms. Lucy deButts, U.S. Department of 
Energy, Office of Energy Efficiency and Renewable Energy, Building 
Technologies Program, EE-2J, 1000 Independence Avenue SW., Washington, 
DC 20585-0121. Telephone: (202) 287-1604. Email: metal_halide_lamp_fixtures@ee.doe.gov.
    Mr. Ari Altman, U.S. Department of Energy, Office of the General 
Counsel, GC-71, 1000 Independence Avenue SW., Washington, DC 20585-
0121. Telephone: (202) 287-6307. Email: ari.altman@hq.doe.gov.

SUPPLEMENTARY INFORMATION: 

Table of Contents

I. Summary of the Final Rule and Its Benefits
    A. Benefits and Costs to Customers
    B. Impact on Manufacturers
    C. National Benefits
    D. Conclusion
II. Introduction
    A. Authority
    B. Background
    1. Current Standards
    2. History of Standards Rulemaking for MHLFs
    3. Compliance Date
III. Issues Affecting the Scope of This Rulemaking
    A. Additional MHLFs for Which DOE Is Setting Standards
    1. EISA 2007 Exempted MHLFs
    a. MHLFs With Regulated-Lag Ballasts
    b. MHLFs With 480 V Electronic Ballasts
    c. Exempted 150 W MHLFs
    2. Additional Wattages
    3. General Lighting
    4. High-Frequency Electronic Ballasts
    5. Outdoor Fixtures
    6. Hazardous Locations
    7. Summary of MHLFs for Which DOE Is Setting Standards
    B. Alternative Approaches to Energy Conservation Standards: 
System Approaches
    C. Standby Mode and Off Mode Energy Consumption
IV. General Discussion
    A. Test Procedures
    1. Current Test Procedures
    2. Test Input Voltage
    a. Average of Tested Efficiency at All Possible Voltages
    b. Posting the Highest and Lowest Efficiencies
    c. Test at Single Manufacturer-Declared Voltage
    d. Test at Highest Rated Voltage
    e. Test on Input Voltage Based on Wattage and Available Voltages
    3. Testing High-Frequency Electronic Ballasts
    4. Rounding Requirements
    B. Technological Feasibility
    1. General
    2. Maximum Technologically Feasible Levels
    C. Energy Savings
    1. Determination of Savings
    2. Significance of Savings
    D. Economic Justification
    1. Specific Criteria
    a. Economic Impact on Manufacturers and Customers
    b. Savings in Operating Costs Compared to Increase in Price
    c. Energy Savings
    d. Lessening of Utility or Performance of Equipment
    e. Impact of Any Lessening of Competition
    f. Need for National Energy Conservation
    g. Other Factors
    2. Rebuttable Presumption
V. Methodology and Discussion
    A. Market and Technology Assessment
    1. General
    2. Equipment Classes
    a. Input Voltage
    b. Lamp Wattage
    c. Fixture Application
    d. Electronic Configuration
    e. Circuit Type
    f. Summary
    B. Screening Analysis
    C. Engineering Analysis
    1. Approach
    2. Representative Equipment Classes
    3. Representative Wattages
    4. Representative Fixture Types
    5. Ballast Efficiency Testing
    6. Input Power Representations
    7. Baseline Ballast Models
    a. 70 W Baseline Ballast
    b. 1000 W Baseline Ballast
    c. 1500 W Baseline Ballast
    d. Summary of Baseline Ballasts
    8. Selection of More-Efficient Units
    a. Higher-Efficiency Magnetic Ballasts
    b. Electronic Ballasts
    9. Efficiency Levels
    10. Design Standard
    11. Scaling to Equipment Classes Not Analyzed
    12. Manufacturer Selling Prices
    a. Manufacturer Production Costs
    b. Empty Fixture Costs
    c. Incremental Costs for Electronically Ballasted MHLFs
    d. Costs Associated With the Design Standard
    e. Manufacturer Markups
    D. Markups to Determine Equipment Price
    1. Distribution Channels
    2. Estimation of Markups
    3. Summary of Markups
    E. Energy Use Analysis
    F. Life-Cycle Cost and Payback Period Analyses
    1. Equipment Cost
    2. Installation Cost
    3. Annual Energy Use
    4. Energy Prices
    5. Energy Price Projections
    6. Replacement Costs
    7. Equipment Lifetime
    8. Discount Rates
    9. Analysis Period Fixture Purchasing Events
    G. National Impact Analysis--National Energy Savings and Net 
Present Value Analysis
    1. Shipments
    a. Historical Shipments

[[Page 7747]]

    b. Fixture Stock Projections
    c. Base Case Shipment Scenarios
    d. Standards-Case Efficiency Scenarios
    2. Site-to-Source Energy Conversion
    H. Customer Subgroup Analysis
    I. Manufacturer Impact Analysis
    1. Manufacturer Production Costs
    2. Shipment Projections
    3. Markup Scenarios
    4. Production and Capital Conversion Costs
    5. Other Comments From Interested Parties
    a. Compliance Period
    b. Alternative Technologies
    c. Opportunity Cost of Investments
    d. Replacement Ballast Market
    e. Potential Impact on Metal Halide Lamp Manufacturers
    6. Manufacturer Interviews
    J. Employment Impact Analysis
    K. Utility Impact Analysis
    L. Emissions Analysis
    M. Monetizing Carbon Dioxide and Other Emissions Impacts
    1. Social Cost of Carbon
    a. Monetizing Carbon Dioxide Emissions
    b. Social Cost of Carbon Values Used in Past Regulatory Analyses
    c. Current Approach and Key Assumptions
    2. Valuation of Other Emissions Reductions
VI. Other Issues for Discussion
    A. Proposed Standard Levels in August 2013 NOPR
    B. Reported Value
    C. Three-Year Compliance Date
VII. Analytical Results
    A. Trial Standard Levels
    B. Economic Justification and Energy Savings
    1. Economic Impacts on Individual Customers
    a. Life-Cycle Cost and Payback Period
    b. Customer Subgroup Analysis
    c. Rebuttable Presumption Payback
    2. Economic Impacts on Manufacturers
    a. Industry Cash-Flow Analysis Results
    b. Impacts on Employment
    c. Impacts on Manufacturing Capacity
    d. Impacts on Subgroups of Manufacturers
    e. Cumulative Regulatory Burden
    3. National Impact Analysis
    a. Significance of Energy Savings
    b. Net Present Value of Customer Costs and Benefits
    c. Impacts on Employment
    4. Impact on Utility or Performance of Equipment
    5. Impact of Any Lessening of Competition
    6. Need of the Nation to Conserve Energy
    C. Conclusions
    1. Trial Standard Level 5
    2. Trial Standard Level 4
    3. Trial Standard Level 3
    4. Trial Standard Level 2
    D. Final Standard Equations
    E. Backsliding
VIII. Procedural Issues and Regulatory Review
    A. Review Under Executive Orders 12866 and 13563
    B. Review Under the Regulatory Flexibility Act
    1. Description and Estimated Number of Small Entities Regulated
    a. Methodology for Estimating the Number of Small Entities
    b. Manufacturer Participation
    c. Metal Halide Ballast and Fixture Industry Structure
    d. Comparison Between Large and Small Entities
    2. Description and Estimate of Compliance Requirements
    3. Duplication, Overlap, and Conflict With Other Rules and 
Regulations
    4. Significant Alternatives to the Rule
    C. Review Under the Paperwork Reduction Act
    D. Review Under the National Environmental Policy Act of 1969
    E. Review Under Executive Order 13132
    F. Review Under Executive Order 12988
    G. Review Under the Unfunded Mandates Reform Act of 1995
    H. Review Under the Treasury and General Government 
Appropriations Act, 1999
    I. Review Under Executive Order 12630
    J. Review Under the Treasury and General Government 
Appropriations Act, 2001
    K. Review Under Executive Order 13211
    L. Review Under the Information Quality Bulletin for Peer Review
    M. Congressional Notification
IX. Approval of the Office of the Secretary

I. Summary of the Final Rule and Its Benefits

    Title III, Part B \1\ of the Energy Policy and Conservation Act 
of 1975 (EPCA or the Act), Public Law 94-163 (42 U.S.C. 6291-6309, 
as codified), established the Energy Conservation Program for 
Consumer Products Other Than Automobiles.\2\ Pursuant to EPCA, any 
new or amended energy conservation standard that DOE prescribes for 
certain equipment, such as metal halide lamp fixtures (MHLFs or 
``fixtures'' \3\), shall be designed to achieve the maximum 
improvement in energy efficiency that DOE determines is 
technologically feasible and economically justified. (42 U.S.C. 
6295(o)(2)(A)) Furthermore, the new or amended standard must result 
in significant conservation of energy. (42 U.S.C. 6295(o)(3)(B)) In 
accordance with these and other statutory provisions discussed in 
this notice, DOE is adopting new and amended energy conservation 
standards for MHLFs. The new and amended standards, which are the 
minimum allowable ballast efficiencies \4\ based on fixture 
location, ballast type, and rated lamp wattage, are shown in Table 
I.1. These new and amended standards apply to all equipment listed 
in Table I.1 and manufactured in, or imported into, the United 
States on or after the compliance date in the DATES section of this 
notice (additionally, see section II.B.3 of this notice for more 
information on the compliance date determination).
---------------------------------------------------------------------------

    \1\ For editorial reasons, upon codification in the U.S. Code, 
Part B was redesignated Part A.
    \2\ All references to EPCA in this document refer to the statute 
as amended through the American Energy Manufacturing Technical 
Corrections Act (AEMTCA), Public Law 112-210 (Dec. 18, 2012).
    \3\ The scope of this rulemaking encompasses entire MHLFs, 
including the metal halide lamps and metal halide ballasts the 
fixtures contain. Therefore, the ratings of individual components 
are often discussed at a system level. For example, when referring 
to the rated wattages or available input voltages of the lamps and 
ballasts a fixture is designed to operate with, this final rule 
frequently uses shorthand such as ``100 W ballast'' for a ballast 
operating a lamp rated at 100 watts or ``480 V fixture'' for a 
fixture housing a ballast with a dedicated input voltage of 480 
volts.
    \4\ DOE is proposing to continue using a ballast efficiency 
metric for regulation of MHLFs, rather than a system or other 
approach. See section 0 for further discussion.

                               Table I.1--Energy Conservation Standards for MHLFs
----------------------------------------------------------------------------------------------------------------
   Designed to be operated with
lamps of the following rated lamp     Indoor/outdoor     Test input voltage   Minimum standard equation [Dagger]
             wattage                                          [dagger]                        %
----------------------------------------------------------------------------------------------------------------
>=50 W and (1+1.24xP[supcaret](-0.351))) -
                                                                              0.0200.
>=50 W and (1+1.24xP[supcaret](-0.351)).
>=50 W and (1+1.24xP[supcaret](-0.351))) -
                                                                              0.0200.
>=50 W and (1+1.24xPsup⁁(-0.351)).
>100 W and (1+1.24xP[supcaret](-0.351))) -
                                                                              0.0200.
>100 W and (1+1.24xP[supcaret](-0.351)).
>100 W and (1+1.24xP[supcaret](-0.351))) -
                                                                              0.0200.
>100 W and (1+1.24xP[supcaret](-0.351)).
>=150 W ** and =150 W ** and =150 W and 200 W and (1+0.876xP[supcaret](-0.351)).
>=150 W ** and =150 W ** and =150 W and 200 W and (1+0.876xP[supcaret](-0.351)).
>250 W and 250 W and =265 W and 
                                                                              (1+0.876xP[supcaret](-0.351))) -
                                                                              0.0100.
>250 W and (1+0.876xP[supcaret](-0.351)).
>250 W and 250 W and =265 W and 
                                                                              (1+0.876xP[supcaret](-0.351))) -
                                                                              0.0100.
>250 W and (1+0.876xP[supcaret](-0.351)).
>500 W and 500 W and 750 W and 500 W and 500 W and 500 W and 750 W and 500 W and 500 W and 500 W and 750 W and 500 W and 500 W and 500 W and 750 W and 500 W and =50 W and =50 W and 100 W and 100 W and =150 W [dagger] and =150 W [dagger] and 250 W and 250 W and 500 W and 500 W and 2), 105.9-132.4 thousand tons of methane, 0.5-0.6 
thousand tons of nitrous oxide (N2O), 37.5-47.2 thousand 
tons of sulfur dioxide (SO2), 28.2-35.0 tons of nitrogen 
oxides (NOX) and 0.05-0.06 tons of mercury (Hg).\3\ 
Through 2030, the estimated energy savings would result in 
cumulative emissions reductions of 6.3-6.8 Mt of CO2.
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    \6\ A metric ton is equivalent to 1.1 short tons. Results for 
NOX and Hg are presented in short tons.
    \3\ DOE calculated emissions reductions relative to the Annual 
Energy Outlook (AEO) 2013 Reference case, which generally represents 
current legislation and environmental regulations for which 
implementing regulations were available as of December 31, 2012.
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    The value of the CO2 reductions is calculated using a 
range of values per metric ton of CO2 (otherwise known as 
the Social Cost of Carbon or SCC) developed by a recent interagency 
process.\7\ The derivation of the SCC values is discussed in section 
V.M. Using discount rates appropriate for each set of SCC values, 
DOE estimates that the net present monetary value of the 
CO2 emissions reductions is between $0.15 billion and 
$2.55 billion. DOE also estimates that the net present monetary 
value of the NOX emissions reductions is $17.34 million 
at a 7-percent discount rate, and $44.20 million at a 3-percent 
discount rate.\8\
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    \7\ Technical Support Document: Technical Update of the Social 
Cost of Carbon for Regulatory Impact Analysis Under Executive Order 
12866. Interagency Working Group on Social Cost of Carbon, United 
States Government. May 2013 (Revised November 2013). 
www.whitehouse.gov/sites/default/files/omb/assets/inforeg/technical-update-social-cost-of-carbon-for-regulator-impact-analysis.pdf.
    \8\ DOE is currently investigating valuation of avoided Hg and 
SO2 emissions.
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    Table I.3 summarizes the national economic costs and benefits 
expected to result from today's standards for MHLFs.

   Table I.3--Summary of National Economic Benefits and Costs of MHLF
                     Energy Conservation Standards *
------------------------------------------------------------------------
                                      Present value
             Category                 million 2012$    Discount rate (%)
------------------------------------------------------------------------
                                Benefits
------------------------------------------------------------------------
Operating Cost Savings............                754                  7
                                                1,636                  3
CO2 Reduction Monetized Value                     146                  5
 ($11.8/t case) **................
CO2 Reduction Monetized Value                     682                  3
 ($39.7/t case) **................
CO2 Reduction Monetized Value                   1,088                2.5
 ($61.2/t case) **................
CO2 Reduction Monetized Value                   2,106                  3
 ($117/t case) **.................
NOX Reduction Monetized Value (at                  17                  7
 $2639/ton) **....................
                                                   37                  3
                                   -------------------------------------
    Total Benefits [dagger].......              1,453                  7
                                                2,355                  3
------------------------------------------------------------------------
                                  Costs
------------------------------------------------------------------------
Incremental Installed Costs.......                465                  7
                                                  721                  3
------------------------------------------------------------------------
                              Net Benefits
------------------------------------------------------------------------
Including CO2 and NOX [dagger]                    988                  7
 Reduction Monetized Value........
                                                1,634                  3
------------------------------------------------------------------------
* This table presents the primary (low shipments scenario) estimate of
  costs and benefits associated with fixtures shipped in 2017-2046.
  These results include benefits to customers which accrue after 2047
  from the equipment purchased in 2017-2046. The results account for the
  incremental variable and fixed costs incurred by manufacturers due to
  the standard, some of which may be incurred in preparation for the
  rule.
** The CO2 values represent global monetized values of the SCC, in
  2012$, in 2015 under several scenarios of the updated SCC values. The
  first three cases use the averages of SCC distributions calculated
  using 5%, 3%, and 2.5% discount rates, respectively. The fourth case
  represents the 95th percentile of the SCC distribution calculated
  using a 3% discount rate. The SCC time series used by DOE incorporate
  an escalation factor. The value for NOX is the average of the low and
  high values used in DOE's analysis.
[dagger] Total Benefits for both the 3% and 7% cases are derived using
  the series corresponding to average SCC with a 3-percent discount
  rate.

    The benefits and costs of today's standards, for equipment sold 
in 2017-2046, can also be expressed in terms of annualized values. 
The annualized monetary values are the sum of (1) the annualized 
national economic value of the benefits from operating the equipment 
(consisting primarily of operating cost savings from using less 
energy, minus increases in equipment purchase and

[[Page 7750]]

installation costs, which is another way of representing customer 
NPV), plus (2) the annualized monetary value of the benefits of 
emission reductions, including CO2 emission 
reductions.\9\
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    \9\ DOE used a two-step calculation process to convert the time-
series of costs and benefits into annualized values. First, DOE 
calculated a present value in 2013, the year used for discounting 
the NPV of total customer costs and savings, for the time-series of 
costs and benefits using discount rates of 3 and 7 percent for all 
costs and benefits except for the value of CO2 
reductions. For the latter, DOE used a range of discount rates, as 
shown in Table I.3. From the present value, DOE then calculated the 
fixed annual payment over a 30-year period (2017 through 2046) that 
yields the same present value. The fixed annual payment is the 
annualized value. Although DOE calculated annualized values, this 
does not imply that the time-series of cost and benefits from which 
the annualized values were determined is a steady stream of 
payments.
---------------------------------------------------------------------------

    Although adding the value of customer savings to the values of 
emission reductions provides a valuable perspective, two issues 
should be considered. First, the national operating cost savings are 
domestic U.S. customer monetary savings that occur as a result of 
market transactions, while the value of CO2 reductions is 
based on a global value. Second, the assessments of operating cost 
savings and CO2 savings are performed with different 
methods that use different time frames for analysis. The national 
operating cost savings is measured for the lifetime of MHLFs shipped 
in 2017-2046. The SCC values, on the other hand, reflect the present 
value of all future climate-related impacts resulting from the 
emission of one metric ton of carbon dioxide in each year. These 
impacts continue well beyond 2100.
    Estimates of annualized benefits and costs of today's standards 
are shown in Table I.4. The results under the primary estimate are 
as follows. Using a 7-percent discount rate for benefits and costs 
other than CO2 reduction, for which DOE used a 3-percent 
discount rate along with the average SCC series that uses a 3-
percent discount rate, the cost of the standards in today's rule is 
$46 million per year in increased equipment costs, while the 
benefits are $74 million per year in reduced equipment operating 
costs, $38 million in CO2 reductions, and $1.71 million 
in reduced NOX emissions. In this case, the net benefit 
amounts to $68 million per year. Using a 3-percent discount rate for 
all benefits and costs and the average SCC series, the cost of the 
standards in today's rule is $40 million per year in increased 
equipment costs, while the benefits are $91 million per year in 
reduced operating costs, $38 million in CO2 reductions, 
and $2.07 million in reduced NOX emissions. In this case, 
the net benefit amounts to $91 million per year.

                 Table I.4--Annualized Benefits and Costs of New and Amended Standards for MHLFs
----------------------------------------------------------------------------------------------------------------
                                                               Primary (low) net           High net benefits
                                     Discount rate            benefits estimate *      estimate * Million 2012$/
                                                              Million 2012$/year                 year
----------------------------------------------------------------------------------------------------------------
                                                    Benefits
----------------------------------------------------------------------------------------------------------------
Operating Cost Savings......  7%........................  74........................  92
                              3%........................  91........................  119
CO2 Reduction at ($11.8       5%........................  11........................  13
 case) **.
CO2 Reduction at ($39.7/t     3%........................  38........................  46
 case) **.
CO2 Reduction at ($61.2/t     2.5%......................  56........................  68
 case) **.
CO2 Reduction at ($117.0/t    3%........................  117.......................  142
 case) **.
NOX Reduction at ($2639/ton)  7%........................  1.71......................  1.95
 **.
                              3%........................  2.07......................  2.46
                             -----------------------------------------------------------------------------------
    Total Benefits[dagger]..  7% plus CO2 range.........  87 to 194.................  107 to 236
                              7%........................  114.......................  140
                              3%........................  131.......................  168
                              3% plus CO2 range.........  104 to 211................  135 to 264
----------------------------------------------------------------------------------------------------------------
                                                      Costs
----------------------------------------------------------------------------------------------------------------
Incremental Product Costs...  7%........................  46........................  52
                              3%........................  40........................  48
----------------------------------------------------------------------------------------------------------------
                                                  Net Benefits
----------------------------------------------------------------------------------------------------------------
    Total [dagger]..........  7% plus CO2 range.........  41 to 148.................  54 to 184
                              7%........................  68........................  87
                              3%........................  91........................  120
                              3% plus CO2 range.........  64 to 171.................  87 to 216
----------------------------------------------------------------------------------------------------------------
* This table presents the annualized costs and benefits associated with fixtures shipped in 2017-2046. These
  results include benefits to consumers which accrue after 2046 from the fixtures purchased from 2017-2046. The
  results account for the incremental variable and fixed costs incurred by manufacturers due to the standard,
  some of which may be incurred in preparation for the rule. The Primary (Low) and High Benefits Estimates
  utilize projections of energy prices from the AEO2013 Reference case and High Estimate, respectively. The
  Primary (Low) and High Benefits Estimates are also based on projected fixture shipments in the Low Shipments,
  Roll-up and High Shipments, Roll-up scenarios, respectively. In addition, the Primary (Low) estimate uses
  incremental equipment costs that assume fixed equipment prices throughout the analysis period. The High
  estimate uses incremental equipment costs that reflect a declining trend for equipment prices, using AEO price
  trends (deflators). The methods used to derive projected price trends are explained in section V.F.1.
** The CO2 values represent global monetized values of the SCC, in 2012$, in 2015 under several scenarios of the
  updated SCC values. The first three cases use the averages of SCC distributions calculated using 5-percent, 3-
  percent, and 2.5-percent discount rates, respectively. The fourth case represents the 95th percentile of the
  SCC distribution calculated using a 3-percent discount rate. The SCC time series used by DOE incorporate an
  escalation factor. The value for NOX is the average of the low and high values used in DOE's analysis.
[dagger] Total Benefits for both the 3-percent and 7-percent cases are derived using the series corresponding to
  average SCC with 3-percent discount rate. In the rows labeled ``7% plus CO2 range'' and ``3% plus CO2 range,''
  the operating cost and NOX benefits are calculated using the labeled discount rate, and those values are added
  to the full range of CO2 values.

D. Conclusion

    Based on the analyses culminating in this final rule, DOE found 
the benefits to the nation of the standards (energy savings, 
customer LCC savings, positive NPV of customer benefit, and emission 
reductions) outweigh the burdens (loss of INPV and LCC increases for 
some users of this equipment). DOE has concluded that the standards 
in

[[Page 7751]]

today's final rule represent the maximum improvement in energy 
efficiency that is technologically feasible and economically 
justified, and would result in significant conservation of energy.

II. Introduction

    The following section briefly discusses the statutory authority 
underlying today's final rule, as well as some of the relevant 
historical background related to the establishment of standards for 
MHLFs.

A. Authority

    Title III, Part B \10\ of the Energy Policy and Conservation Act 
of 1975 (EPCA or the Act), Public Law 94-163 (42 U.S.C. 6291-6309, 
as codified) established the Energy Conservation Program for 
Consumer Products Other Than Automobiles, a program covering most 
major household appliances (collectively referred to as ``covered 
equipment''),\11\ which includes the types of MHLFs that are the 
subject of this rulemaking. (42 U.S.C. 6292(a)(19)) EPCA, as amended 
by the Energy Independence and Security Act of 2007 (EISA 2007) 
prescribes energy conservation standards for this equipment (42 
U.S.C. 6295(hh)(1)), and directs DOE to conduct a rulemaking to 
determine whether to amend these standards. (42 U.S.C. 
6295(hh)(2)(A)) DOE notes that under 42 U.S.C. 6295(hh)(3)(A), the 
agency must conduct a second review of energy conservation standards 
for MHLFs and publish a final rule no later than January 1, 2019.
---------------------------------------------------------------------------

    \10\ For editorial reasons, upon codification in the U.S. Code, 
Part B was redesignated Part A.
    \11\ All references to EPCA in this document refer to the 
statute as amended through the American Energy Manufacturing 
Technical Corrections Act (AEMTCA), Public Law 112-210 (Dec. 18, 
2012).
---------------------------------------------------------------------------

    Pursuant to EPCA, DOE's energy conservation program for covered 
equipment consists essentially of four parts: (1) Testing; (2) 
labeling; (3) the establishment of federal energy conservation 
standards; and (4) certification and enforcement procedures. The 
Federal Trade Commission (FTC) is primarily responsible for 
labeling, and DOE implements the remainder of the program. Subject 
to certain criteria and conditions, DOE is required to develop test 
procedures to measure the energy efficiency, energy use, or 
estimated annual operating cost of covered equipment. (42 U.S.C. 
6293) Manufacturers of covered equipment must use the prescribed DOE 
test procedure as the basis for certifying to DOE that their 
equipment complies with the applicable energy conservation standards 
adopted under EPCA and when making representations to the public 
regarding the energy use or efficiency of that equipment. (42 U.S.C. 
6293(c) and 6295(s)) Similarly, DOE must use these test procedures 
to determine whether the equipment complies with standards adopted 
pursuant to EPCA. Id. DOE test procedures for MHLFs currently appear 
at title 10 of the Code of Federal Regulations (CFR) section 
431.324.
    DOE must follow specific statutory criteria for prescribing new 
or amended standards for covered equipment. As indicated above, any 
new or amended standard for covered equipment must be designed to 
achieve the maximum improvement in energy efficiency that is 
technologically feasible and economically justified. (42 U.S.C. 
6295(o)(2)(A)) Furthermore, DOE may not adopt any standard that 
would not result in the significant conservation of energy. (42 
U.S.C. 6295(o)(3)) Moreover, DOE may not prescribe a standard: (1) 
For certain equipment, including MHLFs, if no test procedure has 
been established for the equipment, or (2) if DOE determines by rule 
that the new or amended standard is not technologically feasible or 
economically justified. (42 U.S.C. 6295(o)(3)(A)-(B)) In deciding 
whether a new or amended standard is economically justified, DOE 
must determine whether the benefits of the standard exceed its 
burdens. (42 U.S.C. 6295(o)(2)(B)(i)) DOE must make this 
determination after receiving comments on the proposed standard, and 
by considering, to the greatest extent practicable, the following 
seven factors:
    1. The economic impact of the standard on manufacturers and 
customers of the equipment subject to the standard;
    2. The savings in operating costs throughout the estimated 
average life of the covered equipment in the type (or class) 
compared to any increase in the price, initial charges, or 
maintenance expenses for the covered equipment that 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 equipment 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 of Energy (Secretary) considers 
relevant.

(42 U.S.C. 6295(o)(2)(B)(i)(I)-(VII))

    EPCA, as codified, also contains what is known as an ``anti-
backsliding'' provision, which prevents the Secretary from 
prescribing any new or amended standard that either increases the 
maximum allowable energy use or decreases the minimum required 
energy efficiency of covered equipment. (42 U.S.C. 6295(o)(1)) Also, 
the Secretary may not prescribe an amended or new standard if 
interested persons have established by a preponderance of the 
evidence that the standard is likely to result in the unavailability 
in the United States of any covered equipment type (or class) of 
performance characteristics (including reliability), features, 
sizes, capacities, and volumes that are substantially the same as 
those generally available in the United States. (42 U.S.C. 
6295(o)(4))
    Further, EPCA, as codified, establishes a rebuttable presumption 
that a standard is economically justified if the Secretary finds 
that the additional cost to the customer of purchasing equipment 
complying with an energy conservation standard level will be less 
than three times the value of the energy savings during the first 
year that the customer will receive as a result of the standard, as 
calculated under the applicable test procedure. See 42 U.S.C. 
6295(o)(2)(B)(iii).
    Additionally, 42 U.S.C. 6295(q)(1) specifies requirements when 
promulgating a standard for a type or class of covered equipment 
that has two or more subcategories. DOE must specify a different 
standard level than that which applies generally to such type or 
class of equipment for any group of covered equipment that has the 
same function or intended use if DOE determines that equipment 
within such group (A) consumes a different kind of energy from that 
consumed by other covered equipment within such type (or class); or 
(B) has a capacity or other performance-related feature that other 
equipment within such type (or class) does not have and such feature 
justifies a higher or lower standard. (42 U.S.C. 6295(q)(1)) In 
determining whether a performance-related feature justifies a 
different standard for a group of equipment, DOE must consider such 
factors as the utility to the customer of such a feature and other 
factors DOE deems appropriate. Id. Any rule prescribing such a 
standard must include an explanation of the basis on which such 
higher or lower level was established. (42 U.S.C. 6295(q)(2))
    Federal energy conservation requirements generally supersede 
state laws or regulations concerning energy conservation testing, 
labeling, and standards. (42 U.S.C. 6297(a)-(c)) DOE may, however, 
grant waivers of federal preemption for particular state laws or 
regulations, in accordance with the procedures and other provisions 
set forth under 42 U.S.C. 6297(d)).
    Finally, pursuant to the amendments contained in section 310(3) 
of EISA 2007, any final rule for new or amended energy conservation 
standards promulgated after July 1, 2010, are required to address 
standby mode and off mode energy use. (42 U.S.C. 6295(gg)(3)) 
Specifically, when DOE adopts a standard for covered equipment after 
that date, it must, if justified by the criteria for adoption of 
standards under EPCA (42 U.S.C. 6295(o)), incorporate standby mode 
and off mode energy use into the standard, or, if that is not 
feasible, adopt a separate standard for such energy use for that 
equipment. (42 U.S.C. 6295(gg)(3)(A)-(B)) DOE's current test 
procedures and standards for MHLFs address standby mode and off mode 
energy use. However, in this rulemaking, DOE only addresses active 
mode energy consumption as the equipment included in the scope of 
coverage only consumes energy in active mode.

B. Background

1. Current Standards

    EISA 2007 prescribed the current energy conservation standards 
for MHLFs manufactured on or after January 1, 2009. (42 U.S.C. 
6295(hh)(1)) The current standards are set forth in Table II.1. EISA 
2007 excludes from the standards: MHLFs with regulated-lag ballasts, 
MHLFs with electronic ballasts that operate at 480 volts (V); and 
MHLFs that (1) are rated only for 150 watt (W) lamps; (2) are rated 
for use in wet locations; and (3) contain a ballast that is rated to 
operate at ambient air temperatures higher than 50 [deg]C.

[[Page 7752]]

       Table II.1--Federal Energy Efficiency Standards for MHLFs *
------------------------------------------------------------------------
                                  Operated lamp rated   Minimum ballast
          Ballast type               wattage range        efficiency %
------------------------------------------------------------------------
Pulse-start.....................  >=150 and =150 and =150 and =250 and http://www1.eere.energy.gov/buildings/appliance_standards/rulemaking.aspx/ruleid/16. The framework document described the procedural and 
analytical approaches that DOE anticipated using to evaluate energy 
conservation standards for MHLFs, and identified various issues to 
be resolved in conducting this rulemaking.
    DOE held a public meeting on January 26, 2010, during which it 
presented the contents of the framework document, described the 
analyses it planned to conduct during the rulemaking, sought 
comments from interested parties on these subjects, and in general, 
sought to inform interested parties about, and facilitate their 
involvement in, the rulemaking. At the meeting and during the period 
for commenting on the framework document, DOE received comments that 
helped identify and resolve issues involved in this rulemaking.
    DOE then gathered additional information and performed 
preliminary analyses to help develop potential energy conservation 
standards for MHLFs. On April 1, 2011, DOE published in the Federal 
Register an announcement (the preliminary analysis notice) of the 
availability of the preliminary technical support document (the 
preliminary TSD) and of another public meeting to discuss and 
receive comments on the following matters: (1) The equipment classes 
DOE planned to analyze; (2) the analytical framework, models, and 
tools that DOE was using to evaluate standards; (3) the results of 
the preliminary analyses performed by DOE; and (4) potential 
standard levels that DOE could consider. 76 FR 1812 (April 1, 2011). 
In the preliminary analysis notice, DOE requested comment on these 
issues. The preliminary TSD is available at http://www1.eere.energy.gov/buildings/appliance_standards/rulemaking.aspx/ruleid/16.
    The preliminary TSD summarized the activities DOE undertook in 
developing standards for MHLFs, and discussed the comments DOE 
received in response to the framework document. It also described 
the analytical framework that DOE uses in this rulemaking, including 
a description of the methodology, the analytical tools, and the 
relationships among the various analyses that are part of the 
rulemaking. The preliminary TSD presented and described in detail 
each analysis DOE performed up to that point, including descriptions 
of inputs, sources, methodologies, and results.
    The public meeting announced in the preliminary analysis notice 
took place on April 18, 2011. At this meeting, DOE presented the 
methodologies and results of the analyses set forth in the 
preliminary TSD. Interested parties discussed the following major 
issues at the public meeting: (1) Alternative approaches to 
performance requirements and the various related efficiency metrics; 
(2) the possibility of including design standards; (3) amendments to 
the test procedures for metal halide (MH) ballasts to account for 
multiple input voltages; (4) the cost and feasibility of utilizing 
electronic ballasts in MHLFs; (5) equipment class divisions; (6) 
overall pricing methodology; (7) lamp lifetimes; (8) cumulative 
regulatory burden; (9) shipments; and (10) the possibility of 
merging the MHLF and the high-intensity discharge (HID) lamp 
rulemakings.
    In August 2013, DOE published a notice of proposed rulemaking 
(NOPR) in the Federal Register proposing new and amended energy 
conservation standards for MHLFs. In conjunction with the NOPR, DOE 
also published on its Web site the complete TSD for the proposed 
rule, which incorporated the analyses DOE conducted and technical 
documentation for each analysis. The NOPR TSD was accompanied by the 
LCC spreadsheet, the national impact analysis spreadsheet, and the 
manufacturer impact analysis (MIA) spreadsheet--all of which are 
available on DOE's Web site.\12\ The proposed standards were as 
shown in Table II.2.78 FR 51463 (August 20, 2013).
---------------------------------------------------------------------------

    \12\ All the spreadsheets models developed for this rulemaking 
proceeding are available at: http://www1.eere.energy.gov/buildings/appliance_standards/rulemaking.aspx/ruleid/16.

                         Table II.2--Energy Conservation Standards Proposed in the NOPR
----------------------------------------------------------------------------------------------------------------
 Designed to be operated with lamps      Indoor/outdoor         Test input voltage     Minimum standard equation
of the following rated lamp wattage         [dagger]             [dagger][dagger]             [Dagger]  %
----------------------------------------------------------------------------------------------------------------
>=50 W and (1+2.5xP[supcaret](-
                                                                                       0.55)).[Dagger]
>=50 W and (1+2.5xP[supcaret](-
                                                                                       0.55)).
>=50 W and (1+2.5xP[supcaret](-
                                                                                       0.55)).
>=50 W and (1+2.5xP[supcaret](-
                                                                                       0.55)).
>100 W and (1+0.36xP[supcaret](-
                                                                                       0.30)).
>100 W and (1+0.36xP[supcaret](-
                                                                                       0.30)).
>100 W and (1+0.36xP[supcaret](-
                                                                                       0.30)).
>100 W and (1+0.36xP[supcaret](-
                                                                                       0.30)).
>=150 W ** and =150 W and 200 W and =150 W ** and =150 W and 200 W and =150 W ** and =150 W and 200 W and =150 W ** and =150 W and 200 W and 250 W and 250 W and 250 W and 250 W and 500 W and 500 W to =1000 W to 500 W and 500 W to =1000 W to 500 W and 500 W to =1000 W to 500 W and 500 W to =1000 W to =150 W would be tested at
  277 V. Ballasts not designed to operate at either of these voltages would be tested at the highest voltage for
  which the ballast is designed to operate.
[Dagger] P is defined as the rated wattage of the lamp that the MHLF is designed to operate.

    In the NOPR DOE invited comment, particularly on the following 
issues: (1) The expanded scope of coverage, (2) the proposed 
amendments to the test procedure, (3) equipment class divisions, (4) 
the efficiency levels (ELs) analyzed, (5) the method of estimating 
magnetically ballasted system input power, (6) the determination to 
include a design standard that would prohibit the sale of probe-
start ballasts in newly sold MHLFs for certain wattages, (7) the 
derived manufacturer selling prices (MSPs), (8) the equipment class 
scaling factor for tested input voltage, and (9) the proposed trial 
standard level (TSL 3). 78 FR 51463 (August 20, 2013).
    DOE held a NOPR public meeting on September 27, 2013, to hear 
oral comments on and solicit information relevant to the proposed 
rule (hereafter the NOPR public meeting). Interested parties in 
attendance discussed the following major issues: (1) The compliance 
date, (2) amendments to the test procedure, (3) scope of the 
rulemaking, (4) equipment class divisions, (5) impacts on the 
magnetic ballast footprint, (6) impacts on fixture design, (7) 
testing and manufacturing variation, and (8) impacts of solid-state 
lighting market penetration on MHLF shipments.
    DOE considered the comments received in response to the NOPR 
after its publication and at the NOPR public meeting when developing 
this final rule, and responds to these comments in this notice.

3. Compliance Date

    EPCA, as amended by EISA 2007, contains guidelines for the 
compliance date of the standards amended by this rulemaking. EPCA 
requires DOE to determine whether to amend the standards in effect 
for MHLFs and whether any amended standards should apply to 
additional MHLFs. The Secretary was directed to publish a final rule 
no later than January 1, 2012 to determine whether the energy 
conservation standards established by EISA 2007 for MHLFs should be 
amended, with any amendment applicable to equipment manufactured 
after January 1, 2015. (42 U.S.C. 6295(hh)(2)(B)) As discussed in 
section VI.C, DOE has determined it will maintain the three-year 
interval between the publication date of the final rule in the 
Federal Register and the compliance date.

III. Issues Affecting the Scope of This Rulemaking

A. Additional MHLFs for Which DOE Is Setting Standards

    The existing energy conservation standards for MHLFs are 
established in EPCA through amendments made by EISA 2007. (42 U.S.C. 
6295(hh)(1)(A)) The statute excludes from coverage MHLFs with 
regulated-lag ballasts; electronic ballasts that operate at 480 V; 
and ballasts that are rated only for (1) use with 150 W lamps, (2) 
use in wet locations, and (3) operation in ambient air temperatures 
higher than 50 [deg]C.\13\ DOE considered expanding the coverage of 
its energy conservation standards to include these exempted MHLF 
types and additional rated lamp wattages. For each previously 
exempted MHLF type and for all expansions of the covered wattage 
range, DOE considered potential energy savings, technological 
feasibility, and economic justification when determining whether to 
include them in the scope of coverage.
---------------------------------------------------------------------------

    \13\ As a point of reference, 50 [deg]C is equivalent to 
122[emsp14][deg]F.
---------------------------------------------------------------------------

    Some stakeholders expressed confusion at the NOPR public 
meeting, stating that they interpreted this rulemaking as 
establishing efficiency standards for all metal halide ballasts 
rather than just ballasts in new metal halide lamp fixtures. The 
Edison Electric Institute (EEI) contended that the rule is 
misleading because the title indicates it is a rule for metal halide 
lamp fixtures when it actually establishes standards for all metal 
halide ballasts, including replacement ballasts. (EEI, Public 
Meeting Transcript, No. 48 at pp. 14-15, 67-69) \14\ DOE clarifies 
that the scope of this rulemaking affects all new MHLFs. Ballasts 
sold with new fixtures after the compliance date must meet or exceed 
the standards promulgated by this rulemaking. Any ballasts sold on 
the replacement market do not need to comply with these standards.
---------------------------------------------------------------------------

    \14\ A notation in the form ``EEI, Public Meeting Transcript, 
No. 48 at pp. 14-15, 67-69'' identifies a comment that DOE has 
received and included in the docket of this rulemaking. This 
particular notation refers to a comment: (1) Submitted by EEI; (2) 
in the transcript of the MHLF NOPR public meeting, document number 
48 in the docket of this rulemaking; and (3) appearing on pages 14-
15 and 67-69 of that transcript.
---------------------------------------------------------------------------

    Regarding the additional fixtures that DOE proposed including in 
the scope of coverage, the California Energy Commission (CEC) 
generally supported the expanded scope for MHLFs DOE proposed in the 
NOPR. (CEC, No. 52 at p. 3) DOE received no other comment regarding 
the general approach to expand the scope of coverage and considers 
specific scope comments in the following sections.

[[Page 7754]]

1. EISA 2007 Exempted MHLFs

a. MHLFs With Regulated-Lag Ballasts

    Regulated-lag ballasts are mainly used for specialty 
applications where line voltage variation is large. Regulated-lag 
ballasts are designed to withstand significant line voltage 
variation with minimum wattage variation to the lamp, which results 
in an efficiency penalty compared to ballasts whose output changes 
more significantly with line voltage variation. The power regulation 
provided by regulated-lag ballasts is higher than any other magnetic 
ballast. To be able to withstand large variations, regulated-lag 
ballasts are designed to be significantly larger than standard 
ballasts. Through manufacturer interviews and market research, DOE 
determined that the size and weight of regulated-lag ballasts limit 
their use as substitutes in traditional applications. Manufacturers 
and market research confirmed that their exemption did not lead to a 
significant market shift to regulated-lag ballasts. Furthermore, 
DOE's market research found none of this equipment available in 
major manufacturers' catalogs. The absence of regulated-lag ballasts 
from catalogs indicates a very small market share and therefore 
limited potential for significant energy savings. Thus, in the NOPR 
DOE proposed continuing to exempt MHLFs with regulated-lag ballasts 
from energy conservation standards.
    Universal Lighting Technologies (ULT) and the National 
Electrical Manufacturers Association (NEMA) agreed with DOE's 
proposal to continue exempting regulated-lag ballasts from the scope 
of this rulemaking. NEMA further added that this higher cost 
technology is used in limited and specific applications, such as 
heavy industrial, security, and street and tunnel lighting, in order 
to avoid lamp failures caused by severe voltage dips. (ULT, No. 50 
at p. 2; NEMA, No. 56 at p. 5; NEMA, Public Meeting Transcript, No. 
48 at p. 48) Agreeing with this description of a limited, niche 
market and receiving no comments to the contrary, in this final rule 
DOE exempts regulated-lag ballasts from energy conservation 
standards.

b. MHLFs With 480 V Electronic Ballasts

    In the NOPR, DOE concluded that 480 V electronic ballasts have a 
very small market share as they are only manufactured by one company 
and have limited availability from distributors. As a result, DOE 
determined that there is limited potential for significant energy 
savings, and in the NOPR proposed continuing to exempt MHLFs with 
480 V electronic ballasts from energy conservation standards.
    Philips Lighting (Philips), ULT, and NEMA agreed with DOE's 
decision to exclude 480 V electronic ballasts in the scope of this 
rulemaking. ULT noted that very few 480 V electronic ballasts are in 
the market, while Philips commented that 480 V electronic ballasts 
do not exist at any wattage. (Philips, Public Meeting Transcript, 
No. 48 at p. 130; ULT, No. 50 at p. 2; NEMA, No. 56 at p. 5) Having 
received no comments in disagreement, DOE continues to exempt 480 V 
electronic ballasts from energy conservation standards in this final 
rule.

c. Exempted 150 W MHLFs

    After receiving exemption from energy conservation standards in 
EISA 2007, shipments of 150 W outdoor MHLFs rated for wet and high-
temperature locations increased. Further, some indoor applications 
use the exempted outdoor MHLFs, negating possible energy savings for 
indoor 150 W MHLFs. Therefore, in the NOPR DOE concluded that 
including the currently exempt 150 W MHLFs in the scope of coverage 
has the potential for significant energy savings. Additionally, as a 
range of ballast efficiencies exists in commercially available 
ballasts, DOE found that improving the efficiencies of the ballasts 
included in these fixtures is technologically feasible and 
economically justified. Accordingly, in the NOPR DOE proposed 
including 150 W MHLFs in wet locations and ambient temperatures 
greater than 50 [deg]C in the scope of this rulemaking.
    NEMA, ULT, CEC, and the Southern Company disagreed with DOE's 
decision to include all 150 W ballasts in the scope of this 
rulemaking. (NEMA, No. 56 at pp. 5, 12; ULT, No. 50 at pp. 2-3; CEC, 
No. 52 at p. 3; Southern Company, No. 64 at p. 2; No. 64 at p. 2) 
NEMA commented that while DOE does have the authority to include 
this equipment, it must be done in a technologically and 
economically feasible manner. NEMA stated that the efficiencies 
adopted in the final rule must be substantially lowered from those 
proposed in the NOPR to be technologically feasible. (NEMA, No. 56 
at pp. 5, 24) In support of this point, ULT and NEMA noted that the 
industry has not yet been able to create a 150 W MHLF with a 
magnetic ballast that achieves 88 percent efficiency, which is the 
minimum efficiency requirement proposed in the NOPR for previously 
exempt 150 W MHLFs. (ULT, Public Meeting Transcript, No. 48 at pp. 
108-109; ULT, No. 50 at pp. 5-6, 23-24; NEMA, No. 56 at p. 13)
    In contrast, in a joint comment the Pacific Gas and Electric 
Company, Southern California Gas Company, San Diego Gas and 
Electric, and Southern California Edison (hereafter referred to as 
the California investor-owned utilities or the ``CA IOUs'') 
supported DOE's proposal to include previously exempt 150 W MHLFs in 
the scope of coverage. CA IOUs were unaware of any specific 
attributes that limit 150 W ballasts from reaching greater 
efficiency, and believe the lower efficiencies of these ballasts are 
more likely due to their prior exemption from standards, as there is 
significant room for improvement. Therefore, CA IOUs supported the 
inclusion of these ballasts. (CA IOUs, No. 54 at pp. 1-2) Also, in a 
joint comment the Appliance Standards Awareness Project, American 
Council for an Energy-Efficient Economy, National Consumer Law 
Center, Natural Resources Defense Council, Northwest Energy 
Efficiency Alliance, and Northwest Power and Conservation Council 
(hereafter referred to as the ``Joint Comment'') supported including 
150 W MHLFs previously exempted by EISA 2007 in the scope of this 
final rule. (Joint Comment, No. 62 at p. 9)
    DOE agrees that commercially available magnetic ballasts cannot 
meet the EISA 2007 specified 88 percent efficiency. However, the 150 
W fixtures exempted by EISA 2007 have a range of magnetic ballast 
efficiencies available below 88 percent and therefore energy 
conservation standards are technologically feasible. These fixtures 
can be considered separately from those 150 W fixtures covered by 
EISA 2007 by separating them into different equipment classes and 
DOE therefore finds no reason the previously exempt 150 W fixtures 
should not be covered by this rulemaking. Therefore in this final 
rule, DOE has included 150 W fixtures rated for use in wet locations 
and ambient temperatures greater than 50 [deg]C in the scope of 
coverage.
    NEMA, ULT, and Southern Company commented that the inclusion of 
150 W ballast efficiency requirements would practically prohibit 
usage of 150 W magnetic ballasts, thereby forcing the usage of 
electronic ballasts in new fixtures. (NEMA, No. 56 at p. 6; ULT, No. 
50 at pp. 2-3; Southern Company, No. 64 at p. 2) ULT and Southern 
Company expressed concerns that electronic ballasts for MH lamps are 
not proven in outdoor applications and are vulnerable to failures 
due to moisture, temperatures higher than 50 [deg]C, and voltage 
variations and surges caused by lightning and other natural events. 
(ULT, No. 50 at pp. 2-3; Southern Company, No. 64 at p. 2)
    DOE considered both more efficient magnetic and more efficient 
electronic ballasts as replacements for ballasts in the previously 
exempt 150 W fixtures. DOE has determined that, with the proper 
fixture adjustments, electronic ballasts can be used in the same 
applications as magnetic ballasts. For detailed discussion of this 
decision, see section V.A. DOE has concluded that the standard 
levels adopted in this final rule are economically justified.
    General Electric (GE) commented that energy conservation 
standards for previously exempt 150 W MHLFs could actually increase 
rather than decrease national energy consumption. GE noted that the 
purpose of the 150 W exemption from EISA 2007 was to shift the 
market from 175 W fixtures to 150 W fixtures, thereby saving energy. 
Thus, GE disagreed with the way DOE analyzed 150 W fixtures and 
noted that the previously exempt fixtures should not be subject to 
standards higher than max tech. (GE, Public Meeting Transcript, No. 
48 at pp. 135-136)
    CA IOUs acknowledged that 150 W ballasts can be a low-wattage 
replacement for 175 W applications. Accordingly, CA IOUs encouraged 
increasing efficiency standards for both wattage levels equally, so 
as not to inadvertently push customers to the higher-wattage 
alternatives. (CA IOUs, No. 54 at pp. 1-2) CEC agreed, stating that 
by incentivizing 150 W fixtures through minimal efficiency 
standards, the market would be driven toward purchasing these lower-
wattage fixtures instead of 175 W or 200 W fixtures. (CEC, No. 52 at 
p. 3)
    The Joint Comment noted that while customers may choose to shift 
between different wattage MHLFs, continuing to exempt 150 W MHLFs is 
not the best solution. For example, a continued exemption might 
create market distortions and hinder the transitions to more 
efficient light-emitting diode (LED) lamps in this

[[Page 7755]]

wattage category. (Joint Comment, No. 62 at p. 9) The Joint Comment 
also stated that even if the inclusion of 150 W fixtures leads to 
the use of more 175 W or 200 W fixtures, it might not result in more 
energy consumption as switching to higher-wattage fixtures could 
also reduce the number of fixtures installed. In situations where 
the number of fixtures installed is not reduced, additional energy 
use could be offset by increased ballast efficiency in this wattage 
bin. In addition, the increased price of the 175 W fixtures provides 
more disincentive to purchase them over 150 W fixtures. Finally, the 
Joint Comment argued that if the standards apply to all wattage 
ranges from 50 W to 500 W, switching from 150 W to a higher-wattage 
fixture would not be a concern because all fixtures would be subject 
to the same standards. (Joint Comment, No. 62 at p. 9)
    DOE notes that the exemption of certain 150 W fixtures from EISA 
2007 resulted in a shift from 175 W to the exempted 150 W fixtures, 
which resulted in energy savings. In the shipments analysis, DOE 
considers how different standards for 150 W and 175 W MHLFs may 
impact customer choices. For example, when the initial first cost 
for 150 W fixtures exceeds that of 175 W fixtures, the shipments 
analysis models a shift to 175 W MHLFs. Even with some customers 
shifting to higher wattage MHLFs, energy conservation standards for 
150 W fixtures still result in energy savings due to increased 
ballast efficiency. In this final rule, DOE has determined that 
standards for previously exempt 150 W MHLFs are technologically 
feasible, economically justified, and would result in significant 
energy savings (see section VII.C for details). Therefore, DOE has 
included previously exempt 150 W fixtures in the scope of coverage 
of this rulemaking.

2. Additional Wattages

    Based on equipment testing and market research, DOE found in the 
NOPR that energy conservation standards for MHLFs rated for wattages 
greater than 50 W and less than 150 W, and MHLFs rated for wattages 
greater than 500 W, are technologically feasible, economically 
justified, and would result in significant energy savings. DOE 
determined that MHLFs rated for wattages greater than 2000 W only 
served small-market-share applications like graphic arts, 
ultraviolet (UV) curing, and scanners. Therefore, in the NOPR DOE 
proposed to include in the scope of coverage 50 W-150 W MHLFs and 
501 W-2000 W MHLFs, in addition to the 150 W-500 W MHLFs \15\ 
covered by EISA 2007.
---------------------------------------------------------------------------

    \15\ DOE uses this shorthand to refer to MHLFs with ballasts 
designed to operate lamps rated greater than or equal to 50 W and 
less than 150 W, MHLFs with ballasts designed to operate lamps rated 
greater than 500 W and less than or equal to 2000 W, and MHLFs with 
ballasts designed to operate lamps rated greater than or equal to 
150 W and less than or equal to 500 W, respectively.
---------------------------------------------------------------------------

    NEMA and ULT opposed the expansion of coverage of this 
rulemaking to include 50 W-150 W MHLFs. They further commented that 
coverage of 50 W-100 W MHLFs would require redesign of all magnetic 
ballasts in that range, which would be nearly equivalent to banning 
magnetic ballasts. (NEMA, No. 56 at p. 6; ULT, No. 50 at pp. 2-3)
    DOE has found MHLFs with a variety of ballast efficiencies in 
the 50 W-150 W range, including the 50 W-100 W range specifically 
cited by NEMA and ULT. Therefore, DOE believes energy conservation 
standards for 50 W-150 W MHLFs are technologically feasible. DOE 
considered both more efficient magnetic and more efficient 
electronic ballasts as replacements for ballasts in this rulemaking. 
DOE has determined that, with the proper fixture adjustments, 
electronic ballasts can be used in the same applications as magnetic 
ballasts. For detailed discussion of this decision, see section V.A. 
Economic impacts of standard levels on individual customers, 
manufacturers, and the nation are discussed in section VII.B. DOE 
has concluded that the standard levels adopted in this final rule 
for 50 W-150 W MHLFs are economically justified and would result in 
significant energy savings. Therefore, DOE has included 50 W-150 W 
MHLFs in the scope of coverage for this final rule.
    DOE received several comments regarding the inclusion of MHLFs 
greater than 500 W in the scope of coverage. CA IOUs and 
Earthjustice supported the expansion of the scope of coverage to 
include 50 W-2000 W fixtures. (CA IOUs, No. 54 at pp. 1-2; 
Earthjustice, Public Meeting Transcript, No. 48 at p. 171) CA IOUs 
commented that because 18 percent of MH ballasts are designed to 
operate lamps greater than 500 W, there exists an opportunity for 
significant energy savings. (CA IOUs, No. 54 at pp. 1-2)
    In contrast, NEMA and ULT disagreed with the inclusion of MHLFs 
greater than 500 W, noting that coverage of the 501 W-2000 W range 
would require redesign of the 750 W fixture family and this would 
come with significant cost increase. (NEMA, No. 56 at pp. 6-7; ULT, 
No. 50 at pp. 2-3)
    DOE believes that standards for 500 W-1000 W MHLFs are 
technologically feasible because MHLFs in this wattage range contain 
ballasts that exhibit a range of efficiencies, indicating it is 
possible for a standard to improve the efficiency of ballasts 
already on the market. Specifically, DOE has found 750 W MHLFs with 
ballasts at multiple efficiencies that span both EL1 and EL2. 
Furthermore, DOE has analyzed MHLFs in this wattage range and 
concluded that standards for these MHLFs are economically justified 
and result in significant energy savings (see section VII.B of this 
notice for more details). Therefore, DOE includes 500 W-1000 W MHLFs 
in the scope of coverage for this rulemaking.
    NEMA, GE, ULT, Musco Sports Lighting, LLC (Musco Lighting), 
Venture Lighting International, Inc. (Venture), and OSRAM SYLVANIA 
Inc. (OSI) all asserted that fixtures greater than 1000 W should not 
be covered by this rulemaking, as they are only operated in 
``specialty lighting'' applications. They stated that the lamps' 
limited applications and low hours of operation do not result in 
appreciable savings opportunities, provide little energy gains at a 
significant cost, and pose an unjustified burden on manufacturers. 
(NEMA, Public Meeting Transcript, No. 48 at p. 114; NEMA, No. 56 at 
pp. 6-7; GE, Public Meeting Transcript, No. 48 at pp. 115, 172; ULT, 
No. 50 at pp. 2-3; Musco Lighting, Public Meeting Transcript, No. 48 
at pp. 118, 180; Musco Lighting, No. 55 at pp. 3-4; Venture, Public 
Meeting Transcript, No. 48 at p. 170; OSI, Public Meeting 
Transcript, No. 48 at p. 172) Further, NEMA cited the 2010 U.S. 
Lighting Market Characterization (2010 LMC),\16\ as evidence that 
stadium and sports lighting, the most common application for 
fixtures greater than 1000 W, is a niche market, unsuitable for 
energy savings exploration. Specifically, NEMA noted that in the 
2010 LMC, the 839,000 MH lamps in stadium applications represent 2.8 
percent of outdoor MH lamps (0.4 percent of all outdoor lamps) and 
only 1.2 percent of all installed MH lamps (see Table 4.1 in the 
2010 LMC). For MH lamps in stadium applications, the average wattage 
is 1554 W (see Table 4.28 in the 2010 LMC) with an average usage of 
just 1 hour per day (see Table 4.29 in the 2010 LMC). NEMA agreed 
with the 2010 LMC that this is a reasonable average usage profile 
for MH lamps greater than 1000 W. In contrast, typical outdoor MH 
lamps average 12.1 hours per day ranging from 8.8 hours on building 
exteriors to 15 hours in parking areas. (NEMA, No. 56 at pp. 6-7)
---------------------------------------------------------------------------

    \16\ U.S. Department of Energy, Office of Energy Efficiency and 
Renewable Energy. 2010 U.S. Lighting Market Characterization. 2010. 
Available at http://apps1.eere.energy.gov/buildings/publications/pdfs/ssl/2010-lmc-final-jan-2012.pdf.
---------------------------------------------------------------------------

    Musco Lighting pointed out that DOE's decision to not directly 
analyze 480 V magnetic ballasts due to low shipment volume supported 
their assertion that 1500 W fixtures should be exempt from energy 
conservation standards. Musco Lighting specified that as more than 
50 percent of their shipments of 1500 W MHLFs contained a 480 V 
ballast, both MHLF types should be exempt. (Musco Lighting, Public 
Meeting Transcript, No. 48 at p. 129)
    DOE determined that sports lighting, which is the predominant 
application for lamps above 1000 W, fits the definition of general 
lighting and is therefore included in the scope of this rulemaking 
(see the following section III.A.3 for additional discussion). 
Although these higher wattage MHLFs do not comprise a large 
percentage of the market, their high wattage could potentially 
result in significant energy savings. DOE notes that MHLFs greater 
than 1000 W exist in a variety of efficiencies and therefore 
standards for these MHLFs are technologically feasible. DOE 
acknowledges, however, that MHLFs greater than 1000 W have a 
different cost-efficiency relationship than 501 W to 1000 W MHLFs. 
Therefore, in this final rule, DOE created a separate equipment 
class to analyze these MHLFs. See section V.A.2 for additional 
detail. After considering the economic impacts of standards for 
MHLFs greater than 1000 W on individual customers, manufacturers, 
and the nation, DOE has concluded that standards for these MHLFs are 
not economically justified. Therefore, in this final rule, DOE has 
not included MHLFs greater than 1000 W in the scope of coverage and 
has not adopted energy conservation standards for these MHLFs. See 
section VII for a discussion of the economic impacts.

[[Page 7756]]

3. General Lighting

    EISA 2007 defines the scope of this rulemaking as applying to 
MHLFs used in general lighting applications. (42 U.S.C. 6291(64)) In 
section 2 of 10 CFR Part 430, Subpart A, a general lighting 
application is defined as lighting that provides an interior or 
exterior area with overall illumination. In the NOPR, DOE proposed 
to add this definition to 10 CFR Part 431.2,\17\ the section of the 
CFR that relates to commercial and industrial equipment, such as 
MHLFs. DOE's research indicated that there are a number of 
applications, such as outdoor sports lighting and airfield lighting, 
which commonly use MH ballasts of 1000 W to 2000 W and provide 
general illumination to an exterior area. In the NOPR, DOE proposed 
that such applications are general lighting applications and are 
covered by this rulemaking.
---------------------------------------------------------------------------

    \17\ The general lighting application definition prescribed by 
EISA 2007 was previously incorporated into the consumer products 
section (10 CFR Part 430), but has not yet been added to the 
commercial and industrial equipment section (10 CFR Part 431).
---------------------------------------------------------------------------

    ULT, NEMA, GE, Musco Lighting stated that all MHLFs above 1000 W 
have limited operating hours and are for specialty applications, not 
general lighting. (ULT, No. 50 at pp. 2-3; NEMA, No. 56 at pp. 6-7; 
GE, Public Meeting Transcript, No. 48 at p. 115; Musco Lighting, 
Public Meeting Transcript, No. 48 at p. 118) Earthjustice commented 
that the definition of ``general lighting'' refers to overall 
illumination of an interior or exterior area, not to the hours of 
use of an application. Therefore, Earthjustice stated that these 
higher-wattage lamps that serve applications such as sports 
lighting, parks, and airfields that provide overall illumination to 
exterior areas should not be considered niche equipment. 
(Earthjustice, Public Meeting Transcript, No. 48 at pp. 171, 174)
    DOE agrees that the higher wattages fall under the CFR 
definition of general lighting. As mentioned previously, DOE also 
acknowledges that these lamps have limited operating hours and used 
these hours of use to calculate their energy savings potential. 
However, DOE does not believe that low operating hours impacts 
whether high wattage MHLFs are used in general lighting 
applications. DOE has determined that sports lighting is a general 
lighting application because it is ``lighting that provides an 
interior or exterior area with overall illumination.'' In this final 
rule, DOE adopts this definition for general lighting application in 
10 CFR 431.2.

4. High-Frequency Electronic Ballasts

    Electronic ballasts can be separated into two main types, low-
frequency electronic (LFE) and high-frequency electronic (HFE). HFE 
ballasts are electronic ballasts with frequencies greater than or 
equal to 1000 hertz (Hz). DOE received comment that HFE ballasts 
should not be included in the scope of coverage based on 
compatibility issues and the lack of test procedure (DOE's proposed 
test procedure is discussed in section IV.A).
    Venture and NEMA commented that there are no ANSI standards for 
the HFE ballasts that may be required to meet the analyzed standard 
levels, and therefore there will be limited MH lamps for use with 
these ballasts for a substantial period of time. (Venture, Public 
Meeting Transcript, No. 48 at p. 29; NEMA, No. 56 at p. 9) NEMA 
elaborated that many MH lamps are not compatible with existing HFE 
ballasts because of variation in arc tube size and shape. Due to 
this variation, HFE acoustic resonances can cause arc instability or 
even lamp failure. (NEMA, No. 44 at p. 6) NEMA specifically noted 
that high-frequency electronic ballasts are incompatible with the 
most efficacious lamps (ceramic metal halide). A standard that 
requires high frequency electronic ballasts could reduce overall 
energy savings because these ballasts are not compatible with the 
most efficacious MH lamps. (NEMA, No. 56 at p. 9) Furthermore, a 
standard that eliminates ballasts capable of operating ceramic metal 
halide lamps would be a violation of EPCA section 325(o)(4) which 
prohibits DOE from adopting a standard that interested parties have 
demonstrated results in the elimination of product features from the 
market. (NEMA, No. 44 at pp. 6-7) NEMA stated that industry 
standards for high frequency ballasts and lamps have only just begun 
to be developed and without these standards there will continue to 
be limited compatibility between high frequency ballasts and lamps 
(NEMA, No. 44 at p. 7). Even when acceptable frequency ranges are 
found, NEMA commented that HFE ballasts can also cause electrode 
back arcing, leading to shortened lamp life. (NEMA, No. 44 at p. 6)
    As in the NOPR, DOE recognizes there are compatibility issues 
associated with HFE ballasts and some MH lamps, in particular 
ceramic metal halide (CMH) lamps. A standard that requires HFE 
ballasts could result in a full or partial elimination of CMH lamps 
from the market due to these compatibility issues. The elimination 
of CMH lamps could increase energy usage, as CMH lamps are some of 
the most efficacious MH lamps on the market. In the NOPR, DOE 
indicated it would take compatibility issues with HFE ballasts into 
account when selecting the eventual adopted standard of today's 
final rule. However, as detailed in section IV.A of this notice, DOE 
has not adopted a test procedure for HFE ballast, based on the lack 
of an industry consensus test method for this ballast type. DOE has 
found that in the absence of an applicable test method for these 
lamps, HFE ballasts cannot be subject to energy conservation 
standards. Therefore, DOE has not included HFE ballasts in the scope 
of coverage of this rulemaking.

5. Outdoor Fixtures

    In the NOPR, DOE included both indoor and outdoor MHLFs in the 
scope of coverage because DOE determined that standards for both 
types of fixtures were technologically feasible, economically 
justified, and would result in significant energy savings. Because 
DOE concluded that indoor and outdoor fixtures had different cost-
efficiency relationships, DOE analyzed them in separate equipment 
classes.
    The American Public Power Association (APPA) noted that 
separating the outdoor and indoor lamps or exempting outdoor lamps 
is necessary because the usage patterns of outdoor lamps differ 
immensely from indoor. As the circumstances are different when 
considering both classes, APPA furthered, it is difficult to 
understand the effects of proposed efficiency standards on each 
group. APPA also noted that it may make sense to exempt outdoor 
fixtures from energy conservation standards because the electronic 
ballasts will have difficulty in extreme weather conditions. APPA, 
No. 51 at p. 4; APPA, Public Meeting Transcript, No. 48 at p. 103)
    As mentioned previously, in the NOPR DOE determined that 
standards for both types of fixtures were technologically feasible, 
economically justified, and would result in significant energy 
savings. This conclusion is reaffirmed by the analysis in the final 
rule and DOE therefore includes both indoor and outdoor fixtures in 
the scope of coverage for this rulemaking. DOE agrees with analyzing 
outdoor and indoor fixtures separately by placing indoor and outdoor 
MHLFs into separate equipment classes. While the efficiencies 
achievable by indoor and outdoor fixtures are the same, the 
different costs affect the resultant cost-efficiency curves. See 
section V.A.2 of this notice for details on the equipment classes.

6. Hazardous Locations

    Although DOE did not consider exempting fixtures designed for 
use in hazardous locations in the NOPR, NEMA commented that these 
fixtures need to be exempt from energy conservation standards. As 
these fixtures are used in potentially explosive atmospheres and 
listed to Underwriters Laboratories Inc. standard (UL) 844, any 
change in ballast size would require the fixture to be redesigned 
and re-tested, creating a tremendous burden on manufacturers. This 
is because the redesign, retesting, and relisting of these MHLFs 
would take significantly longer than three years, and leave this 
equipment type unavailable for an extended period of time. This 
would result in serious safety concerns until these fixture types 
were available again. NEMA also finds it would be very difficult for 
manufacturers to recoup the investment in standards-induced 
efficiency improvement for these types of MHLFs due to their limited 
market. Therefore, NEMA suggested that hazardous location fixtures 
should be granted an exemption from the rulemaking. (NEMA, No. 56 at 
p. 14)
    As discussed in section V.C.8, the standard levels analyzed in 
this rulemaking do not require an increase in ballast size. 
Therefore, DOE does not believe hazardous location fixtures would 
need to be modified due to a change in ballast size. DOE notes that 
the vast majority of hazardous location fixtures are specified for 
use with magnetic ballasts. Therefore, DOE investigated existing 
fixtures, and the requirements of UL 844, to determine whether 
higher standards for ballasts, specifically those that require 
electronic ballast technology, would cause existing hazardous 
location fixtures to be redesigned and/or retested. After reviewing 
the UL 844 requirements, DOE found no constraints that would 
specifically or effectively preclude the use of electronic ballasts. 
Instead, UL 844 contains explosion protection requirements

[[Page 7757]]

for a luminaire, including requirements that no part of the fixture 
reach the thermal ignition temperature of a particulate or gas in 
the environment. DOE's survey of existing hazardous location 
fixtures found that these fixtures are commonly rated for use with a 
type of MH ballast and specific wattage. For example, a hazardous 
location fixture may be rated for use with a magnetic MH ballast of 
a given wattage (e.g., a 750 W magnetic MH ballast). Most hazardous 
location fixtures that are currently available are certified for use 
with magnetic ballasts, with offerings at a variety of wattages.\18\ 
DOE only identified one hazardous location fixture that was rated 
for use with electronic ballasts (in this case, a 150 W electronic 
ballast). DOE was unable to confirm that hazardous location fixtures 
compatible with electronic ballasts were available at the same 
wattages as hazardous location fixtures compatible with magnetic 
ballasts that are currently offered on the market. However, as 
discussed in section VII.C, DOE is not adopting standards that are 
expected to require the use of electronic ballast technology. 
Therefore, DOE does not believe the adopted standards in this 
rulemaking will require hazardous location fixtures to be redesigned 
and retested and does not exempt them from the standards adopted in 
this final rule.
---------------------------------------------------------------------------

    \18\ While not comprehensive, DOE identified hazardous location 
fixtures certified for use with magnetic ballasts that operate lamps 
with rated wattages between 150 W and 750 W.
---------------------------------------------------------------------------

7. Summary of MHLFs for Which DOE Is Setting Standards

    EISA 2007 established energy conservation standards for MHLFs 
with ballasts designed to operate lamps with rated wattages between 
150 W and 500 W. As previously discussed, EISA 2007 also exempted 
three types of fixtures within the covered wattage range from energy 
conservation standards. In this final rule, DOE extends coverage to 
MHLFs with ballasts designed to operate lamps rated 50 W-150 W and 
501 W-1000 W. DOE also includes one type of previously exempt 
fixture in the scope of coverage: 150 W MHLFs rated for use in wet 
locations and containing a ballast that is rated to operate at 
ambient air temperatures greater than 50 [deg]C. DOE continues to 
exempt regulated-lag ballasts and 480 V electronic ballasts. For all 
ballasts included in the scope of coverage, DOE has determined that 
energy conservation standards are technologically feasible, 
economically justified, and would result in significant energy 
savings. As such, DOE adopts standards for these MHLFs in this final 
rule.

B. Alternative Approaches to Energy Conservation Standards: System 
Approaches

    As discussed in the NOPR, DOE considered several alternatives to 
establishing energy conservation standards for MHLFs by regulating 
the efficiency of the ballast contained within the fixture. 
Specifically, DOE considered a lamp-and-ballast system metric, 
fixture-level metrics, and the compliance paths specified in 
California's Title 20 regulations (which are now preempted by 
federal energy conservation standards in 10 CFR 431.326, 74 FR 
12058; March 23, 2009). DOE concluded that, after considering all of 
these alternate approaches, maintaining the EISA 2007 approach of 
regulating MHLFs by specifying a minimum ballast efficiency was the 
most widely accepted, least burdensome approach that would ensure 
energy conservation standards resulted in energy savings. Therefore, 
in the NOPR DOE proposed standards for MHLFs by requiring that MHLFs 
contain ballasts that comply with minimum specified efficiencies. 
NEMA agreed, citing the increased testing burden associated with 
testing every combination of lamp and ballast sold in a fixture, and 
recognizing that the majority of MHLFs are not shipped with a lamp. 
(NEMA, No. 56 at p. 8) Receiving no comment to the contrary, DOE 
maintains this approach in this final rule.

C. Standby Mode and Off Mode Energy Consumption

    EPCA requires energy conservation standards adopted for covered 
equipment after July 1, 2010 to address standby mode and off mode 
energy use. (42 U.S.C. 6295(gg)(3)) The requirement to incorporate 
standby mode and off mode energy use into the energy conservation 
standards analysis is therefore applicable in this rulemaking.
    DOE determined that it is not possible for MHLFs to meet off 
mode criteria because there is no condition in which the components 
of an MHLF are connected to the main power source and are not 
already in a mode accounted for in either active or standby mode. 
DOE recognizes that MHLFs could be designed with auxiliary control 
devices that could consume energy in standby mode. However, DOE has 
yet to encounter such a control device design, or other type of MHLF 
that uses energy in standby mode, on the market. Therefore, in the 
NOPR DOE concluded that it cannot establish a standard that 
incorporates standby mode or off mode energy consumption. Receiving 
no comment to the contrary, DOE maintains this conclusion in the 
final rule and does not include standby mode or off mode energy 
consumption in the standards adopted in this final rule.

IV. General Discussion

A. Test Procedures

1. Current Test Procedures

    The current test procedures for MH ballasts and MHLFs are 
outlined in Subpart S of 10 CFR Part 431. The test conditions, 
setup, and methodology generally follow the guidance of ANSI C82.6-
2005. Testing requires the use of a reference lamp, which is to be 
driven by the ballast under test conditions until the ballast 
reaches operational stability. Ballast efficiency for the fixture is 
then calculated as the measured ballast output power divided by the 
ballast input power. In the NOPR, DOE considered changes to the test 
procedure regarding input voltage, the testing of HFE ballasts, and 
rounding requirements.

2. Test Input Voltage

    MH ballasts can be operated at a variety of voltages. The most 
common voltages are 120 V, 208 V, 240 V, 277 V, and 480 V. Ballasts 
will also commonly be rated for more than one voltage, such as dual-
input-voltage ballasts that can be operated at 120 V or 277 V, or 
quad-input-voltage ballasts that can be operated at 120 V, 208 V, 
240 V, or 277 V. Through manufacturer feedback and testing, DOE 
found that the specific design of a ballast and the voltage of the 
lamp operated by the ballast can affect the trend between input 
voltage and efficiency.
    The existing test procedures do not specify the voltage at which 
a ballast is to be tested, and the majority of ballasts sold are 
capable of operating at multiple input voltages. Therefore, to 
ensure consistency among testing and reported efficiencies, DOE 
considered methods of standardizing this aspect of testing in the 
NOPR.

a. Average of Tested Efficiency at All Possible Voltages

    One method analyzed in the NOPR was testing ballasts at each 
input voltage at which they are able to operate, and then having a 
standard for the average of these efficiencies. As averaging the 
efficiencies could misrepresent the performance of the ballast in 
its common uses and could increase the testing burden, in the NOPR, 
DOE did not propose this method. Having received no comments to the 
contrary, DOE continues to reject using the average of tested 
efficiency at all possible voltages in this final rule.

b. Posting the Highest and Lowest Efficiencies

    A second approach considered in the NOPR was requiring testing 
at each input voltage and listing the best and worst efficiencies on 
the MHLF label. DOE found that, similar to averaging efficiencies, 
this approach would increase the compliance testing burden for 
manufacturers compared to a requirement to test ballasts only at a 
single voltage. Therefore, DOE did not propose this method. Having 
received no comments to the contrary, DOE continues to reject the 
posting of the highest and lowest efficiencies on an MHLF label in 
this final rule.

c. Test at Single Manufacturer-Declared Voltage

    A third approach considered in the NOPR was that the test 
procedures should allow testing at a single voltage determined by 
the manufacturer and declared in the test report. DOE concluded that 
this approach would not be favorable as the efficiency at the 
manufacturer-declared voltage and the efficiency at the more 
commonly used voltages may not be the same, and as such could 
potentially reduce the energy savings of this rulemaking. Thus, DOE 
did not propose to test ballast efficiency at a single manufacturer-
declared voltage.
    GE agreed that a multi-tap ballast should be tested at just one 
input voltage. Rather than testing at the designated highest 
voltage, GE stated that it should be up to the manufacturer to 
choose the voltage at which the ballast was optimally designed for 
purposes of reporting efficiencies. (GE, Public Meeting Transcript, 
No. 48 at p. 83)
    DOE agrees with testing multi-tap ballasts at a single voltage. 
DOE's position against allowing manufacturers to declare their 
testing input voltage stems from concerns

[[Page 7758]]

that manufacturers could optimize efficiency at a voltage that is 
most convenient or least expensive, rather than the voltage most 
commonly used by customers. If optimal efficiency is achieved at a 
less commonly used voltage, the reported ballast efficiency would 
not be representative of the ballast efficiency in the ballast's 
more common applications. If the efficiency at the tested voltage 
and at the most commonly used voltage are not directly correlated, 
energy savings could potentially be reduced. For these reasons, DOE 
rejects the proposal to allow manufacturers to select the voltage at 
which ballasts are tested in this final rule.

d. Test at Highest Rated Voltage

    Another input voltage specification that DOE considered was 
testing the ballast at the highest voltage possible. However, DOE 
concluded that a ballast's highest rated voltage is not always its 
most common input voltage, and therefore testing and enforcing 
standards at the highest voltage could reduce the potential energy 
savings of this rulemaking. Accordingly, in the NOPR DOE did not 
propose to test ballast efficiency at the highest rated voltage. 
Having received no comments to the contrary, DOE continues to reject 
testing at the highest rated voltage in this final rule.

e. Test on Input Voltage Based on Wattage and Available Voltages

    The final approach analyzed was testing the most common input 
voltages for each wattage range. This meant, when possible, ballasts 
less than 150 W are tested at 120 V, ballasts greater than or equal 
to 150 W are tested at 277 V, and if those specified voltages are 
unavailable, the ballast is tested at the highest available voltage. 
DOE concluded that because this proposal only requires testing at 
one input voltage, it minimizes testing burden. In addition, because 
the input voltage specification matches the most commonly used 
voltage, the requirement encourages optimization of efficiency 
around an input voltage commonly used in practice.
    NEMA and ULT agreed with DOE's NOPR proposals regarding the 
input voltage for testing. (NEMA, No. 56 at p. 8; ULT, No. 50 at p. 
4) Having received no comments to the contrary, in this final rule, 
DOE amends the test procedure to require that ballasts be tested at 
the following input voltages:
     For ballasts less than 150 W with an available voltage 
of 120 V, ballasts will be tested at 120 V.
     For ballasts less than 150 W that lack 120 V as an 
available voltage, ballasts will be tested at the highest available 
input voltage.
     For ballasts operated at 150 W-2000 W that also have 
277 V as an available input voltage, ballasts will be tested at 277 
V.
     For ballasts operated at 150 W-2000 W that lack 277 V 
as an available input voltage, ballasts will be tested at the 
highest available input voltage.

3. Testing High-frequency Electronic Ballasts

    MHLF test procedures reference the 2005 version of ANSI C82.6 
for testing both electronic and magnetic MH ballasts. However, ANSI 
C82.6-2005 does not provide a method for testing HFE ballasts. In 
the NOPR, DOE found that the instrumentation commonly used for HFE 
MH ballast testing is the same instrumentation used for electronic 
fluorescent lamp ballast testing. Therefore, DOE proposed the same 
instrumentation used in electronic fluorescent lamp ballast testing 
be used for testing HFE MH ballasts. These proposed requirements 
specified that once the output frequency of a MH ballast is 
determined to be greater than or equal to 1000 Hz (the frequency at 
which DOE defines HFE ballasts) the test procedure instrumentation 
would be required to include a power analyzer that conforms to ANSI 
C82.6-2005 with a maximum of 100 picofarads (pF) capacitance to 
ground and a frequency response between 40 Hz and 1 MHz. The test 
procedures would also require a current probe compliant with ANSI 
C82.6-2005 that is galvanically isolated and has a frequency 
response between 40 Hz and 20 MHz, and lamp current measurement 
where the full transducer ratio is set in the power analyzer to 
match the current to the analyzer. The full transducer ratio would 
be required to satisfy the following equation:
[GRAPHIC] [TIFF OMITTED] TR10FE14.000

Where:

Iin is current through the current transducer;
Vout is the voltage out of the transducer;
Rin is the power analyzer impedance; and
Rs is the current probe output impedance.

    DOE received comment on the lack of compatibility standards between 
HFE ballasts and MH lamps. NEMA commented that no work has begun on the 
ANSI C82.6 test procedure standard for HFE ballasts. (NEMA, No. 44 at 
p. 7) Philips noted that as HFE ballasts do not have testing standards, 
measurement errors and testing differences could lead to false 
efficiency values. (Philips, Public Meeting Transcript, No. 48 at p. 
70) Similarly, NEMA stated that lack of industry testing standard meant 
efficiencies are computed using internal test procedures. Therefore, 
using catalog data gathered from more than one manufacturer combines 
different test procedures. (NEMA, Public Meeting Transcript, No. 48 at 
p. 31; NEMA, No. 44 at p. 8) NEMA also noted that labs cannot be 
accredited by the National Voluntary Laboratory Accreditation Program 
(NVLAP) to submit HFE ballast testing to DOE without a test procedure 
to accredit to. (NEMA, No. 56 at p. 9) Further, NEMA noted that it is 
difficult to precisely measure the power of these HFE ballasts at 
frequencies over 100 kHz, which experience a 2-5 percent measurement 
uncertainty. With a tenth of a percentage precision on ballast 
efficiency, it will be very difficult to attain these levels of 
measurement. (NEMA, Public Meeting Transcript, No. 48 at p. 30; NEMA, 
No. 44 at p. 8)
    DOE agrees that there are no industry test procedures for HFE 
ballasts. While the addition of instrumentation requirements addresses 
some concerns, specifications for lamps to be paired with the ballast 
during testing and a complete test method specific to HFE ballasts (an 
equivalent document to ANSI C82.6--which covers magnetic ballasts and 
LFE ballasts, but not HFE ballasts) are not currently available. 
Therefore, in this final rule, DOE is not adopting any changes to the 
test procedure for HFE ballasts. As discussed in section III.A.4 of 
this notice, DOE is not considering standards for HFE ballasts because 
a test procedure for HFE ballasts does not exist.
4. Rounding Requirements
    Through testing, DOE found that testing multiple samples of the 
same ballast yielded a range of ballast efficiencies typically 
differing by less than one percent. Because this data introduces both 
test measurement and sample to sample variation, the test measurement 
itself should be at least this accurate. Therefore, DOE came to the 
conclusion that test procedures can resolve differences of less than 
one percent and rounding to the tenths of a percent would be 
reasonable. In the NOPR, DOE proposed amending the MH ballast test 
procedure for measuring and recording input wattage and output wattage 
to require rounding to the nearest tenth of a watt, and the resulting 
calculation of efficiency to the nearest tenth of a percent.
    ULT, EEI, and NEMA commented that most test equipment for MHLFs is 
not calibrated to the proposed level of precision. ANSI standards 
require wattmeters to have 0.5 percent accuracy. (ULT, Public Meeting 
Transcript, No. 48 at p. 82; EEI, Public Meeting Transcript, No. 48 at 
p. 85; NEMA, No. 44 at p. 13). Further, NEMA noted that white paper 
NEMA LSD-63-2012 on variability estimated the tolerance for a sample of 
four magnetic ballasts to be 4.7 percent when 99 percent confidence 
factor is required. (NEMA, No. 56 at p. 8) On the contrary, CA IOUs 
commented that efficiency measurement equipment accurate to plus or 
minus 0.5 percent is already capable of measuring efficiency to the 
nearest watt for lamps of 100 W and above, and the nearest tenth of a 
watt for lamps below 100 W. CA IOUs argued this supports tenths place 
rounding of an efficiency figure and setting of standards to the tenth 
of a percent. (CA IOUs, No. 54 at pp. 2-3). Finally, EEI commented that 
if the difference between EL1 and EL2 is 0.6 percent, and there is a 
testing tolerance

[[Page 7759]]

of plus or minus 1 percent, there could be a classing issue. (EEI, 
Public Meeting Transcript, No. 48 at p. 159).
    DOE reviewed ANSI C82.6-2005 and found that the instrumentation 
requirements stipulate that watts be measured with 3.5 digits of 
resolution, with basic accuracy of 0.5 percent. For an efficiency 
calculation that involves output power divided by input power, 3.5 
digits of resolution allows for rounding efficiency to three 
significant figures (e.g., 0.895 or 89.5 percent) using only three 
digits. DOE also notes that some manufacturers have submitted 
compliance data to DOE's certification, compliance, and enforcement 
(CCE) database rounded to three significant figures and, in response to 
the NOPR, manufacturers had responded to certain issues using 
efficiency data rounded to three significant figures. Both of these 
suggest that manufacturers already have the capability to accomplish 
these measurements. DOE also considered LSD-63, as suggested by NEMA, 
but found that it details the population distribution from all sources 
of variation and did not find that it provides any information 
regarding the ability to measure the efficiency of an individual 
ballast to three significant figures. For these reasons, this final 
rule amends the test procedure to require measuring and calculating 
ballast efficiency to three significant figures. DOE also adopts energy 
conservation standards that are specified to three significant figures.

B. Technological Feasibility

1. General
    In each standards rulemaking, DOE conducts a screening analysis 
based on information gathered on all current technology options and 
prototype designs that could improve the efficiency of the equipment 
that is the subject of the rulemaking. As the first step in such an 
analysis, DOE develops a list of technology options for consideration 
in consultation with manufacturers, design engineers, and other 
interested parties. DOE then determines which of those means for 
improving efficiency are technologically feasible. DOE considers 
technologies incorporated in commercially available equipment or in 
working prototypes to be technologically feasible. 10 CFR 430, subpart 
C, appendix A, section 4(a)(4)(i).
    After DOE has determined that particular technology options are 
technologically feasible, it further evaluates each technology option 
in light of the following additional screening criteria: (1) 
Practicability to manufacture, install, or service; (2) adverse impacts 
on equipment utility or availability; and (3) adverse impacts on health 
or safety. Section V.B of this notice discusses the results of the 
screening analysis for MHLFs, particularly the designs DOE considered, 
those it screened out, and those that are the basis for the TSLs in 
this rulemaking. For further details on the screening analysis for this 
rulemaking, see chapter 4 of the final rule TSD.
2. Maximum Technologically Feasible Levels
    When DOE adopts a new or amended standard for a type or class of 
covered equipment, it must determine the maximum improvement in energy 
efficiency or maximum reduction in energy use that is technologically 
feasible for such equipment. (42 U.S.C. 6295(p)(1)) Accordingly, in the 
engineering analysis, DOE determined the maximum technologically 
feasible (``max-tech'') improvements in energy efficiency for MHLFs, 
using the design parameters for the most efficient equipment available 
on the market or in working prototypes. For MHLFs from 50-500 W, the 
max-tech fixtures use high-grade electronic ballasts. For MHLFs from 
501-2000 W, the max-tech fixtures use magnetic ballasts that 
incorporate high-grade, grain-oriented steel (M6 \19\). (See chapter 5 
of the final rule TSD for additional detail.) The max-tech levels that 
DOE determined for this rulemaking are listed in Table IV.1.
---------------------------------------------------------------------------

    \19\ The American Iron and Steel Institute type numbers and AK 
Steel designations for electrical steel grades consist of the letter 
M followed by a number. The M stands for magnetic material; the 
number is representative of the core loss of that grade.

                                           Table IV.1--Max-Tech Levels
----------------------------------------------------------------------------------------------------------------
 Equipment class wattage range    Efficiency level *             Efficiency-level equation [dagger] %
----------------------------------------------------------------------------------------------------------------
>=50 and (1+0.360xP[supcaret](-0.297))
>100 and (1+0.360xP[supcaret](-0.297))
>=150 ** and (1+0.360xP[supcaret](-0.297))
>250 and (1+0.360xP[supcaret](-0.297))
>500 and 500 W and 750 W and 1000 and EERE Building ApplianceEnergy-
Efficiency Standards,'' (Academy report) was completed in May 2009 
and included five recommendations. A copy of the study can be 
downloaded at: www.nap.edu/catalog.php?record_id=12670.
---------------------------------------------------------------------------

2. Significance of Savings
    As noted above, 42 U.S.C. 6295(o)(3)(B) prevents DOE from adopting 
a standard for covered equipment unless such standard would result in 
``significant'' energy savings. Although the term ``significant'' is 
not defined in the Act, the U.S. Court of Appeals, in Natural Resources 
Defense Council v. Herrington, 768 F.2d 1355, 1373 (D.C. Cir. 1985), 
indicated that Congress intended ``significant'' energy savings in this 
context to be savings that were not ``genuinely trivial.'' The energy 
savings for all of the TSLs considered in this rulemaking (presented in 
section VII.B.3.a) are nontrivial, and, therefore, DOE considers them 
``significant'' within the meaning of section 325 of EPCA.

D. Economic Justification

1. Specific Criteria
    EPCA provides seven factors to be evaluated in determining whether 
a potential energy conservation standard is economically justified. (42 
U.S.C. 6295(o)(2)(B)(i)) The following sections discuss how DOE has 
addressed each of those seven factors in this rulemaking.
a. Economic Impact on Manufacturers and Customers
    In determining the impacts of an amended standard on manufacturers, 
DOE first uses an annual cash-flow approach to determine the 
quantitative impacts. This step includes both a short-term assessment--
based on the cost and capital requirements during the period between 
when a regulation is issued and when entities must comply with the 
regulation--and a long-term assessment over a 30-year period.\22\ The 
industry-wide impacts analyzed include INPV, which values the industry 
on the basis of expected future cash flows; cash flows by year; changes 
in revenue and income; and other measures of impact, as appropriate. 
Second, DOE analyzes and reports the impacts on different types of 
manufacturers, including impacts on small manufacturers. Third, DOE 
considers the impact of standards on domestic manufacturer employment 
and manufacturing capacity, as well as the potential for standards to 
result in plant closures and loss of capital investment. Finally, DOE 
takes into account cumulative impacts of various DOE regulations and 
other regulatory requirements on manufacturers.
---------------------------------------------------------------------------

    \22\ DOE also presents a sensitivity analysis that considers 
impacts for products shipped in a 9-year period.
---------------------------------------------------------------------------

    For individual customers, measures of economic impact include the 
changes in LCC and payback period (PBP) associated with new or amended 
standards. These measures are discussed further in the following 
section. For customers in the aggregate, DOE also calculates the 
national net present value of the economic impacts applicable to a 
particular rulemaking. DOE also evaluates the LCC impacts of potential 
standards on identifiable subgroups of customers that may be affected 
disproportionately by a national standard.
b. Savings in Operating Costs Compared to Increase in Price
    EPCA requires DOE to consider the savings in operating costs 
throughout the estimated average life of the covered equipment compared 
to any increase in the price of the covered equipment that are likely 
to result from the imposition of the standard (42 U.S.C. 
6295(o)(2)(B)(i)(II)) DOE conducts this comparison in its LCC and PBP 
analysis.
    The LCC is the sum of the purchase price of equipment (including 
its installation) and the operating expense (including energy, 
maintenance, and repair expenditures) discounted over the lifetime of 
the equipment. To account for uncertainty and variability in specific 
inputs, such as equipment lifetime and discount rate, DOE uses a 
distribution of values, with probabilities attached to each value. For 
its analysis, DOE assumes that consumers will purchase the covered 
products in the first year of compliance with amended standards.
    The LCC savings and the PBP for the considered ELs are calculated 
relative to a base case that reflects projected market trends in the 
absence of amended standards. DOE identifies the percentage of 
customers estimated to receive LCC savings or experience an LCC 
increase, in addition to the average LCC savings associated with a 
particular standard level.
c. Energy Savings
    Although significant conservation of energy is a separate statutory 
requirement for imposing an energy conservation standard, EPCA requires 
DOE, in determining the economic

[[Page 7761]]

justification of a standard, to consider the total projected energy 
savings that are expected to result directly from the standard. (42 
U.S.C. 6295(o)(2)(B)(i)(III)) As discussed in section V.G, DOE uses the 
NIA spreadsheet to project national site energy savings.
d. Lessening of Utility or Performance of Equipment
    In establishing classes of equipment, and in evaluating design 
options and the impact of potential standard levels, DOE evaluates 
standards that would not lessen the utility or performance of the 
considered equipment. (42 U.S.C. 6295(o)(2)(B)(i)(IV)) The standards 
adopted in today's final rule will not reduce the utility or 
performance of the equipment under consideration in this rulemaking. 
One piece of evidence for this claim includes that magnetic ballast ELs 
are allowed for every covered MHLF wattage and application, meaning 
that manufacturers are not required to change the electronic 
configuration of their current offerings. A second piece of evidence is 
that commercially available stack height and footprint is being 
maintained for all ballasts, resulting in no required change from 
current MHLF size. Another piece of evidence is that no standards were 
adopted for MHLFs greater than 1000 W, so that all commercially 
available MHLFs at such wattages are subjected to no mandatory 
adjustments. Overall, the adopted standards were selected to protect 
the interest of customers and do not lessen MHLF performance or 
utility.
e. Impact of Any Lessening of Competition
    EPCA directs DOE to consider the impact of any lessening of 
competition, as determined in writing by the Attorney General, that is 
likely to result from the imposition of a standard. (42 U.S.C. 
6295(o)(2)(B)(i)(V)) It also directs the Attorney General to determine 
the impact, if any, of any lessening of competition likely to result 
from a standard and to transmit such determination to the Secretary 
within 60 days of the publication of a proposed rule, together with an 
analysis of the nature and extent of the impact. (42 U.S.C. 
6295(o)(2)(B)(ii)) DOE transmitted a copy of its proposed rule to the 
Attorney General with a request that the Department of Justice (DOJ) 
provide its determination on this issue. DOE addresses the Attorney 
General's determination in this final rule.
f. Need for National Energy Conservation
    The energy savings from new and amended standards are likely to 
provide improvements to the security and reliability of the nation's 
energy system. Reductions in the demand for electricity also may result 
in reduced costs for maintaining the reliability of the nation's 
electricity system. DOE conducts a utility impact analysis to estimate 
how standards may affect the nation's needed power generation capacity.
    The new and amended standards also are likely to result in 
environmental benefits in the form of reduced emissions of air 
pollutants and greenhouse gases associated with energy production. DOE 
reports the emissions impacts from today's standards, and from each TSL 
it considered, in section VII.B.6 of this notice. DOE also reports 
estimates of the economic value of emissions reductions resulting from 
the considered TSLs.
g. Other Factors
    EPCA allows the Secretary of Energy, in determining whether a 
standard is economically justified, to consider any other factors that 
the Secretary deems to be relevant. (42 U.S.C. 6295(o)(2)(B)(i)(VII))
2. Rebuttable Presumption
    As set forth in 42 U.S.C. 6295(o)(2)(B)(iii), EPCA creates a 
rebuttable presumption that an energy conservation standard is 
economically justified if the additional cost to the customer of 
equipment that meets the standard is less than three times the value of 
the first year's energy savings resulting from the standard, as 
calculated under the applicable DOE test procedure. DOE's LCC and PBP 
analyses generate values used to calculate the effect potential amended 
energy conservation standards would have on the payback period for 
customers. These analyses include, but are not limited to, the 3-year 
payback period contemplated under the rebuttable-presumption test. In 
addition, DOE routinely conducts an economic analysis that considers 
the full range of impacts to customers, manufacturers, the nation, and 
the environment, as required under 42 U.S.C. 6295(o)(2)(B)(i). The 
results of this analysis serve as the basis for DOE's evaluation of the 
economic justification for a potential standard level (thereby 
supporting or rebutting the results of any preliminary determination of 
economic justification). The rebuttable-presumption payback calculation 
is discussed in section VII.B.1 of this final rule.

V. Methodology and Discussion

    DOE used two spreadsheets to estimate the impact of the adopted 
standards. The first spreadsheet calculates LCCs and PBPs of potential 
new energy conservation standards. The second provides shipments 
forecasts and then calculates national energy savings and NPV impacts 
of new energy conservation standards. The Department also assessed 
manufacturer impacts, largely through use of the Government Regulatory 
Impact Model (GRIM).
    Additionally, DOE uses a version of EIA's National Energy Modeling 
System (NEMS) to estimate the impacts of energy efficiency standards on 
electric utilities and the environment. The NEMS model simulates the 
energy sector of the U.S. economy. The version of NEMS used for 
appliance standards analysis is called NEMS-BT (BT stands for DOE's 
Building Technologies Program), and is based on the AEO2013 version of 
NEMS with minor modifications.\23\ The NEMS-BT accounts for the 
interactions between the various energy supply and demand sectors and 
the economy as a whole. For more information on NEMS, refer to The 
National Energy Modeling System: An Overview, DOE/EIA-0581 (98) (Feb. 
1998), available at: tonto.eia.doe.gov/FTPROOT/forecasting/058198.pdf.
---------------------------------------------------------------------------

    \23\ The EIA does not approve use of the name ``NEMS'' unless it 
describes an AEO version of the model without any modification to 
code or data. Because the present analysis entails some minor code 
modifications and runs the model under various policy scenarios that 
deviate from AEO assumptions, the name ``NEMS-BT'' refers to the 
model as used here.
---------------------------------------------------------------------------

    As a basis for this final rule, DOE has continued to use the 
approaches explained in the NOPR. DOE used the same general methodology 
as applied in the NOPR, but revised some of the assumptions and inputs 
for the final rule in response to public comments. The following 
sections discuss these revisions.

A. Market and Technology Assessment

1. General
    When completing an energy conservation standards rulemaking, DOE 
develops information that provides an overall picture of the market for 
the equipment concerned, including the purpose of the equipment, the 
industry structure, and the market characteristics. This activity 
includes both quantitative and qualitative assessments based on 
publicly available information. The subjects addressed in the market 
and technology assessment for this rulemaking include: equipment 
classes and manufacturers; historical

[[Page 7762]]

shipments; market trends; regulatory and non-regulatory programs; and 
technologies or design options that could improve the energy efficiency 
of the equipment under examination. See chapter 3 of the final rule TSD 
for further discussion of the market and technology assessment.
2. Equipment Classes
    When evaluating and establishing energy conservation standards, DOE 
divides covered equipment into equipment classes by the type of energy 
used or by capacity or other performance-related features that 
justifies a different standard. In making a determination whether a 
performance-related feature justifies a different standard, DOE must 
consider such factors as the utility to the customer of the feature and 
other factors DOE determines are appropriate. (42 U.S.C. 6295(q)) DOE 
then considers separate standard levels for each equipment class based 
on the criteria set forth in 42 U.S.C. 6295(o). In the NOPR, DOE 
proposed to divide equipment classes by input voltage, rated lamp 
wattage, and designation for indoor versus outdoor applications.
a. Input Voltage
    MHLFs are available in a variety of input voltages (most commonly 
120 V, 208 V, 240 V, 277 V, and 480 V), and the majority of fixtures 
are equipped with ballasts that are capable of operating at multiple 
input voltages (for example, quad-input-voltage ballasts are able to 
operate at 120 V, 208 V, 240 V, and 277 V). DOE determined that input 
voltage represents a feature affecting consumer utility as certain 
applications demand specific input voltages. DOE's ballast testing did 
not indicate a prevailing relationship (e.g., higher voltages are not 
always more efficient) between discrete input voltages and ballast 
efficiencies, with one exception. In the NOPR, DOE found that ballasts 
tested at 480 V were less efficient on average than ballasts tested at 
120 V or 277 V.
    As discussed in section IV.A of this final rule, MH ballasts will 
be tested at a single input voltage based on the lamp wattage operated 
by the ballast. Ballasts that operate lamps less than 150 W shall be 
tested at 120 V, and all others shall be tested at 277 V, unless the 
ballast is incapable of operating at the specified input voltage; in 
that case, the ballast shall be tested at the highest input voltage 
possible. Because dedicated 480 V ballasts have a distinct utility in 
that certain applications require 480 V operation and a difference in 
efficiency relative to ballasts tested at 120 V and 277 V, in the NOPR 
DOE proposed separate equipment classes for ballasts tested at 480 V 
(in accordance with the test procedure).
    Philips noted that when manufacturing multi-tap magnetic ballasts, 
each tap must be precisely placed. The voltage variation in each tap 
makes it more difficult for multi-tap ballasts to meet efficiency 
requirements than ballasts with dedicated voltage. (Philips, Public 
Meeting Transcript, No. 48 at p. 99) NEMA, ULT, and Southern Company 
supported a separate equipment class for dedicated 480 V ballasts. 
(NEMA, No. 56 at p. 12; ULT, No. 50 at p. 5; Southern Company, No. 64 
at p. 2)
    DOE acknowledges that the existence of multiple voltage taps could 
cause multi-tap ballasts to be less efficient than dedicated voltage 
ballasts. However, DOE's testing of commercially available ballasts did 
not identify this trend. Rather, DOE's test results indicated that the 
only obvious relationship between input voltage and ballast efficiency 
is that ballasts tested at 480 V were less efficient on average than 
ballasts tested at 120 V or 277 V. As stated above, DOE believes that 
input voltage offers unique utility because certain applications 
require specific input voltages. Therefore, in this final rule, DOE 
creates a separate equipment class for ballasts that are tested at 480 
V.
b. Lamp Wattage
    As lamp wattage increases, lamp-and-ballast systems generally 
produce increasing amounts of light (lumens). Because certain 
applications require more light than others, wattage often varies by 
application. For example, low-wattage (less than 150 W) lamps are 
typically used in commercial applications for general lighting. Medium-
wattage (150 W-500 W) lamps are commonly used in warehouse, street, and 
general commercial lighting. High-wattage (greater than 500 W) lamps 
are used in searchlights, stadiums, and other applications that require 
powerful white light. Because different applications require different 
amounts of light and the light output of lamp-and-ballast systems is 
typically reflected by the wattage, wattage affects consumer utility. 
Additionally, the wattage of a lamp operated by a ballast is correlated 
with the ballast efficiency; ballast efficiency generally increases as 
lamp wattage increase. Because wattage affects consumer utility and has 
a strong correlation to efficiency, DOE determined in the NOPR that 
separate equipment classes based on wattage were warranted.
    DOE found that even within a designated wattage range (such as 101 
W-150 W), the potential efficiencies ballasts can achieve is not 
constant, but rather varies with wattage. Thus for certain wattage 
bins, instead of setting a constant efficiency standard, DOE used an 
equation-based energy conservation standard (see section V.C). DOE 
combined the wattage bins and equations rather than using a single 
equation spanning all covered wattages for two reasons. First, the 
range of ballast efficiencies considered can differ significantly by 
lamp wattage, making it difficult to construct a single continuous 
equation for ballast efficiency from 50 W to 2000 W. This efficiency 
difference can be attributed to the varying cost of increasing ballast 
efficiency for different wattages and the impact of legislated (EISA 
2007) standards that affect only some wattage ranges. Second, different 
wattages often serve different applications and have unique cost-
efficiency relationships. Analyzing certain wattage ranges as separate 
equipment classes allows DOE to establish the energy conservation 
standards that are cost-effective for every wattage.
    In the NOPR, DOE proposed to define MHLF equipment classes by the 
following rated lamp wattage ranges: 50 W-100 W, 101 W-150 W, 150 W-250 
W, 251 W-500 W, and 501 W-2000 W.\24\ As discussed previously in 
section III.A.1, there is an existing EISA 2007 exemption for ballasts 
rated for only 150 W lamps, used in wet locations, and that operate in 
ambient air temperatures higher than 50 [deg]C. This exemption has led 
to a difference in the commercially available efficiencies for ballasts 
that are contained within fixtures exempted versus not exempted from 
EISA 2007. The exempted fixtures have ballasts with a range of 
efficiencies similar to ballasts that operate lamps less than 150 W. 
Fixtures not exempted by EISA 2007 have ballasts that follow efficiency 
trends representative of ballasts greater than 150 W. As a result, DOE 
proposed that 150 W MHLFs previously exempted by EISA 2007 be included 
in the 101 W-150 W range, while 150 W MHLFs subject to EISA 2007 
standards continue to be included in the 150 W-250 W range.
---------------------------------------------------------------------------

    \24\ DOE uses this shorthand to refer to MHLFs designed to 
operate lamps rated at equal to or greater than 50 W and equal to or 
less than 100 W, greater than 100 W and less than 150 W (however, 
including MHLFs designed to operate lamps rated at 150 W and 
exempted from EISA 2007), equal to or greater than 150 W and less 
than or equal to 250 W, greater than 250 W and less than or equal to 
500 W, and greater than 500 W and less than or equal to 2000 W, 
respectively.

---------------------------------------------------------------------------

[[Page 7763]]

    ULT and NEMA stated that industry data shows ballast losses are 
significantly higher in 150 W ballasts relative to 175 W to 500 W 
ballasts due to the increased lamp current in 150 W MHLFs. (ULT, Public 
Meeting Transcript, No. 48 at p. 108; ULT, No. 50 at pp. 5-6, 23; NEMA, 
No. 56 at p. 13) ULT explained that for 150 W-175 W fixtures, the lower 
the wattage, the larger the ballast needed to maintain efficiency. ULT 
noted that this relationship is the net effect of three main factors: 
(1) Higher lamp current, (2) increased impedance, and (3) decreased 
wire cross[hyphen]section. In conjunction, these factors make it 
impossible to have an 88 percent efficient 150 W ballast on a 3.25 inch 
by 3.75 inch (commonly referred to as a ``3x4'') frame. (ULT, No. 50 at 
pp. 23-24) ULT believed that 150 W fixtures could belong to the lower 
wattage bin; otherwise, the proposed standards would result in a ban of 
magnetic autotransformer 150 W ballasts. (ULT, No. 50 at p. 5)
    DOE agrees with ULT and NEMA that 150 W ballasts have a lower 
maximum achievable efficiency relative to 175 W ballasts because of the 
resistive losses characteristic to ballasts at 150 W. Commercially, DOE 
also found that 150 W ballasts have a range of efficiencies similar to 
wattages below 150 W. Both of these trends support 150 W fixtures being 
categorized in separate equipment classes than 175 W fixtures. While 
DOE continues to group 150 W fixtures covered by EISA 2007 in the 150 
W-250 W equipment class, in this final rule DOE maintains the NOPR 
approach to group 150 W fixtures previously exempt by EISA 2007 in the 
101 W-150 W equipment class.
    NEMA proposed that DOE establish a separate equipment class for 575 
W ballasts but did not provide supporting detail for this proposal. 
(NEMA, No. 56 at p. 17) DOE examined the efficiency distribution of 575 
W ballasts and found that efficiency varied in a manner similar to that 
of other ballasts within the 500 W to 1000 W wattage range. DOE is 
unaware of significant differences in the cost-efficiency relationship, 
consumer utility, or application of 575W fixtures relative to 1000 W 
fixtures, and therefore is not establishing a separate equipment class 
for these MHLFs. DOE continues to group all 501 W-1000 W MHLFs in one 
wattage bin, using 1000 W fixtures as representative of the entire 
class.
    Musco Lighting disagreed with the grouping of fixtures in the 501 
W-2000 W range. Musco Lighting stated that there are significant 
differences between the markets and applications of 1500 W and 1000 W 
MHLFs, and, accordingly, they should not be grouped together. (Musco 
Lighting, Public Meeting Transcript, No. 48 at p. 107) Musco Lighting 
commented that 1500 W fixtures should not be in the same equipment 
class as 1000 W fixtures. Musco Lighting commented that a majority of 
1500 W fixtures operate at 480 V input, which distinguishes them from 
other equipment classes. (Musco Lighting, Public Meeting Transcript, 
No. 48 at p. 129) Musco Lighting further commented that annual 
operating hours should be taken into account so that MHLFs used in 
applications with very different operating hours would not be included 
in the same equipment class. Musco Lighting gave the example of sports 
lighting having much fewer operating hours than indoor warehouse 
lighting. (Musco Lighting, Public Meeting Transcript, No. 48 at p. 161)
    Upon further review, DOE agrees that there are differences between 
1500 W and 1000 W fixtures. DOE determined that the trend between 
increasing wattage and increasing efficiency found from 501 W-1000 W 
did not continue above 1000 W. DOE found that above 1000 W, efficiency 
increased to a lesser extent with increased wattage. This is consistent 
with the NOPR analysis, in which different equations were used above 
and below 1000 W. DOE also found that lamp lifetime and annual 
operating hours are much shorter for 1500 W fixtures relative to 1000 W 
fixtures because 1500 W fixtures are predominantly used in sports 
lighting. This causes 1500 W fixtures to have different cost-efficiency 
relationships relative to 1000 W fixtures. There is also a different 
cost-efficiency relationship based on the MSP of the fixtures 
themselves, representing a different portfolio of applications used 
from 501-1000 W and above 1000 W. Therefore, DOE determined that 
separate equipment classes should be established for 501 W-1000 W and 
1001 W-2000 W fixtures.\25\
---------------------------------------------------------------------------

    \25\ DOE uses this shorthand to refer to MHLFs designed to 
operate with lamps rated at greater than 500 W and less than or 
equal to 1000 W, and greater than 1000 W and less than or equal to 
2000 W, respectively.
---------------------------------------------------------------------------

    In summary, DOE established MHLF equipment classes by the following 
rated lamp wattage bins: 50 W-100 W, 101 W-150 W, 150 W-250 W, 251 W-
500 W, 501 W-1000 W, and 1001 W-2000 W. DOE maintained that 150 W 
fixtures previously exempted by EISA 2007 are included in the 101 W-150 
W range, while 150 W fixtures subject to EISA 2007 standards are 
included in the 150 W-250 W range.
c. Fixture Application
    MHLFs are used in a variety of applications such as parking lots, 
roadways, warehouses, big-box retail, and flood lighting. Although the 
fixture size, shape, and optics are often tailored to the application, 
generally the same type of ballast is utilized for most of the 
applications. DOE found in the NOPR, however, that indoor and outdoor 
MHLFs are subject to separate cost-efficiency relationships, 
specifically at the electronic ballast levels.
    As outdoor applications can be subject to large voltage transients, 
MHLFs in such applications require 10 kV voltage transient protection. 
Magnetic MH ballasts are typically resistant to voltage variations of 
this magnitude, while electronic MH ballasts are generally not as 
resilient. Therefore, in order to meet this requirement, electronic 
ballasts in outdoor MHLFs would need either (1) an external surge 
protection device or (2) internal transient protection of the ballast 
using metal-oxide varistors (MOVs) in conjunction with other inductors 
and capacitors.
    DOE also noted that indoor fixtures can require the inclusion of a 
120 V auxiliary tap. This output is used to operate an emergency 
incandescent lamp after a temporary loss of power while the MH lamp is 
still too hot to restart. These taps are generally required for only 
one out of every ten indoor lamp fixtures. A 120 V tap is easily 
incorporated into a magnetic ballast due to its traditional core and 
coil design, and incurs a negligible incremental cost. Electronic 
ballasts, though, require additional design to add this 120 V auxiliary 
power functionality.
    These added features impose an incremental cost to the ballast or 
fixture (further discussed in section V.C.12 of this notice). As these 
incremental costs could affect the cost-effectiveness of fixtures for 
indoor versus outdoor applications, in the NOPR DOE proposed separate 
equipment classes for indoor and outdoor fixtures.
    DOE proposed that outdoor fixtures be defined as those that (1) are 
rated for use in wet locations and (2) have 10 kV of voltage transient 
protection. DOE proposed to define the wet location rating as specified 
by the National Fire Protection Association (NFPA) 70-2002,\26\ section 
410.10(A) or UL 1598

[[Page 7764]]

Wet Location Listed.\27\ Providing two possible definitions will reduce 
the compliance burden as many manufacturers are already familiar with 
one or both of these ratings (the NFPA 70-2002 definition was included 
in EISA 2007 and both are used in California energy efficiency 
regulations). For 10 kV voltage transient protection, DOE proposed to 
use the 10 kV voltage pulse withstand requirement from ANSI C136.2-
2004.
---------------------------------------------------------------------------

    \26\ The NFPA 70-2002 states that fixtures installed in wet or 
damp locations shall be installed such that water cannot enter or 
accumulate in wiring components, lampholders, or other electrical 
parts. All fixtures installed in wet locations shall be marked, 
``Suitable for Wet Locations.'' All fixtures installed in damp 
locations shall be marked ``Suitable for Wet Locations'' or 
``Suitable for Damp Locations.''
    \27\ UL Standard Publication 1598 defines a wet location is one 
in which water or other liquid can drip, splash, or flow on or 
against electrical equipment. A wet location fixture shall be 
constructed to prevent the accumulation of water on live parts, 
electrical components, or conductors not identified for use in 
contact with water. A fixture that permits water to enter the 
fixture shall be provided with a drain hole.
---------------------------------------------------------------------------

    APPA agreed with separating equipment classes for indoor and 
outdoor fixtures, as they have separate uses that create differences in 
the frequency and length of use. APPA stated that because the 
circumstances are different when considering both classes, it is 
difficult to understand the effects of proposed efficiency standards on 
each group. (APPA, No. 51 at p. 4; APPA, Public Meeting Transcript, No. 
48 at p. 103) Conversely, NEMA noted that separate equipment classes 
for indoor and outdoor fixtures could be problematic as, at the ballast 
level, there is no way of knowing whether equipment will be used 
indoors or outdoors. (NEMA, No. 56 at p. 14) Acuity Brands Lighting, 
Inc. (Acuity) commented that fixture application should also take into 
account the probability of transient voltages and extreme conditions, 
even in indoor applications. (Acuity, Public Meeting Transcript, No. 48 
at p. 162) NEMA and ULT suggested combining indoor and outdoor 
equipment classes, except for electronic ballasts, as fewer classes 
will mean fewer reporting requirements. NEMA acknowledged that this 
will conflict with DOE's desire to encourage electronic ballasts in 
outdoor applications. (NEMA, No. 56 at p. 9; ULT, No. 50 at p. 4)
    DOE believes that indoor and outdoor MHLFs should be placed into 
separate equipment classes. While the efficiencies achievable indoors 
and outdoors are the same, the different costs between indoor and 
outdoor fixtures result in different cost-efficiency curves. When 
electronic ballasts are used in outdoor applications, they require 
additional transient protection because of the potential for voltage 
surges in outdoor locations. Indoor fixtures with electronic ballasts 
also have an added cost to provide 120 V auxiliary power functionality 
for use in the event of a power outage. Both of these cost adders are 
discussed in more detail in section V.C.12. As these costs adders 
differ based on a fixture being used indoors or outdoors, the cost-
efficiency relationships differ based on indoor or outdoor application, 
and therefore separate equipment classes are warranted. Thus, in this 
final rule DOE establishes separate equipment classes for indoor and 
outdoor fixtures. DOE defines outdoor fixtures as those that (1) are 
rated for use in wet locations and (2) have 10 kV of voltage transient 
protection. Conversely, fixtures that do not meet these requirements 
will be defined as indoor fixtures. DOE continues to use the wet 
location rating definition from the National Fire Protection 
Association 70-2002, section 410.10(A) or UL 1598 Wet Location listing.
d. Electronic Configuration
    Of the two MH ballast types (electronic and magnetic), magnetic 
ballasts are currently more common, making up more than 90 percent of 
MH ballast shipments. Magnetic ballasts typically use transformer-like 
copper or aluminum windings on a steel or iron core. The newer 
electronic ballasts, which are more efficient but less common, rely on 
integrated circuits, switches, and capacitors or inductors to control 
current and voltage to the lamp. Both electronic and magnetic ballasts 
are capable of producing the same light output and, with certain 
modifications (e.g., thermal management, transient protection, 120 V 
auxiliary power functionality), can be used interchangeably in all 
applications. In the NOPR, DOE concluded that electronic configuration 
and circuit type do not affect consumer utility. With the necessary 
design alterations, electronic ballasts can provide the same utility as 
any magnetic ballast circuit type. Because electronic ballasts are 
typically more efficient than magnetic ballasts, utility is not lost 
with increasing efficiency. Therefore, DOE did not propose to define 
equipment classes based on electronic configuration.
    ULT stated that electronic HID ballasts were originally intended 
for indoor, niche purposes. Therefore, automatically expecting that 
electronic MH ballasts would be able to perform in outdoor conditions, 
including applications subjected to wind, extreme temperature, and 
transient surges, is not reasonable. ULT noted that electronic 
ballasts' vulnerability in outdoor applications is known throughout the 
industry. (ULT, Public Meeting Transcript, No. 48 at p. 52)
    NEMA also disagreed with DOE not dividing equipment classes by 
electronic configuration. NEMA stated that performance requirements 
should be separated for electronic and magnetic ballasts to avoid an 
enormous burden on the industry. (NEMA, No. 56 at p. 12, 24) NEMA 
commented that they disagreed with DOE's suggestion that an electronic 
ballast is a design option for a magnetic ballast, as they are 
completely different technologies. (NEMA, No. 56 at p. 14).
    DOE has determined that these electronic ballasts, when fitted in 
an appropriate fixture, can be used in the same applications as 
magnetic ballasts. As mentioned in the previous section, various 
protections will be required for electronic ballasts in these 
applications. See section V.C.8.b for more detail about the feasibility 
of electronic ballasts as more efficient replacements for magnetic 
ballasts. After adjusting outdoor fixture prices to account for the 
modifications necessary to incorporate electronic ballasts, DOE has 
found that electronic ballasts can be reliably used in the same outdoor 
applications as magnetic ballasts. Therefore, DOE did not find that 
magnetic ballasts provided a unique utility over electronic ballasts. 
Thus, in this final rule, DOE included electronic and magnetic ballasts 
in the same equipment class.
e. Circuit Type
    NEMA disagreed with DOE not dividing equipment classes by circuit 
type, citing the fluorescent lamp ballast rule as precedent. (NEMA, No. 
56 at pp. 12, 24) ULT and NEMA proposed three different technology 
classes; magnetic series reactors, magnetic autotransformers, and 
electronic. (ULT, No. 50 at p. 5; NEMA, No. 44 at p. 17) NEMA explained 
the need for dividing equipment classes in this way by describing the 
technologies' different utilities and relationships to efficiency. 
Specifically, NEMA stated that series reactors circuits are the most 
efficient, although they do not offer any power regulation. Power 
factor correction is weak with this ballast type, and high power factor 
increases total harmonic distortion. This circuit type only works for 
lamps that require an open circuit voltage lower than the mains. It 
results in an increased inrush and current, and reduced maximum number 
of lamps per circuit. (NEMA, No. 44 at p. 18) Autotransformer ballasts 
may be used on various mains voltages, and the ballast open circuit 
voltage may be higher than the mains voltage. Constant-wattage 
autotransformer (CWA) designs

[[Page 7765]]

include a secondary coil and operate with lower harmonic distortion. 
They offer better power regulation than series reactors and are highly 
reliable. (NEMA, No. 44 at p. 19) Electronic circuits are typically 
less reliable than autotransformer circuits, but operate with similar 
energy efficiency to series reactors. (NEMA, No. 44 at p. 20)
    DOE agrees that within magnetic ballasts there are multiple circuit 
types, such as reactor and autotransformer. However, DOE has found that 
electronic ballasts can provide the same utility as any magnetic 
circuit type and can be substituted in all applications, while being 
generally more efficient than all magnetic ballasts. DOE also notes 
that all of the magnetic ELs in this final rule are determined by 
autotransformer magnetic ballasts, as autotransformer ballasts are the 
most common type on the market. Because reactor ballasts are typically 
more efficient than autotransformer ballasts, DOE found that setting a 
magnetic ballast EL based on autotransformer efficiency would not 
prohibit reactor ballasts. For these reasons, DOE did not find it 
necessary in this final rule to separate equipment classes by circuit 
type.
f. Summary
    DOE developed equipment classes in this final rule using three 
class-setting factors: input voltage, rated lamp wattage, and fixture 
application. DOE presents the resulting equipment classes in Table V.1

                 Table V.1--MHLF Equipment Classes Table
------------------------------------------------------------------------
 Designed to be operated with
lamps of the following  rated   Indoor/outdoor        Input voltage
         lamp wattage              [dagger]            type[Dagger]
------------------------------------------------------------------------
>=50 W and =50 W and =50 W and =50 W and 100 W and 100 W and 100 W and 100 W and =150 W ** and =150 W ** and =150 W ** and =150 W ** and 250 W and 250 W and 250 W and 250 W and 500 W and 500 W and 500 W and 500 W and 1000 W and 1000 W and 1000 W and 1000 W and =150 W would be
  tested at 277 V. Ballasts not designed to operate at either of these
  voltages would be tested at the highest voltage the ballast is
  designed to operate. See section IV.A for further detail.

B. Screening Analysis

    For the screening analysis, DOE consults with industry, technical 
experts, and other interested parties to determine which technology 
options to consider further and which to screen out. Appendix A to 
subpart C of 10 CFR Part 430, ``Procedures, Interpretations, and 
Policies for Consideration of New or Revised Energy Conservation 
Standards for Consumer Products'' (the Process Rule), sets forth 
procedures to guide DOE in its consideration and promulgation of new or 
revised energy conservation standards. These procedures elaborate on 
the statutory criteria provided in 42 U.S.C. 6295(o) and, in part, 
eliminate problematic technologies early in the process of prescribing 
or amending an energy conservation standard. In particular, sections 
4(b)(4) and 5(b) of the Process Rule provide guidance to DOE for 
determining which design options are unsuitable for further 
consideration:
    Technological feasibility. DOE will consider technologies 
incorporated in commercial products or in working prototypes to be 
technologically feasible.
    Practicability to manufacture, install, and service. If mass 
production and reliable installation and servicing of a technology in 
commercial products could be achieved on the scale necessary to serve 
the relevant market at the time the standard comes into effect, then 
DOE will consider that technology practicable to manufacture, install, 
and service.
    Adverse impacts on product utility or product availability. If DOE 
determines a technology would have significant adverse impacts on the 
utility of the product to significant subgroups of consumers, or would 
result in the unavailability of any covered equipment type with 
performance characteristics (including reliability), features, sizes, 
capacities, and volumes that are substantially the same as equipment 
generally available in the United States

[[Page 7766]]

at the time, it will not consider this technology further.
    Adverse impacts on health or safety. If DOE determines that a 
technology will have significant adverse impacts on health or safety, 
it will not consider this technology further.
    In the NOPR, DOE screened out one technology option: laminated 
sheets of amorphous steel. For magnetic metal halide ballasts, DOE 
found one method of decreasing transformer losses is to create the core 
of the inductor from laminated sheets of amorphous steel, insulated 
from each other. DOE screened out amorphous steel technology because it 
failed to pass the ``practicable to manufacture, install, and service'' 
criterion, and using amorphous steel could have adverse impacts on 
consumer utility because increasing the size and weight of the ballast 
may limit the places a customer could use the ballast. DOE received no 
comments to the contrary, and thus continues to screen out amorphous 
steel in the final rule.
    DOE identified the design options listed in Table V.2 as 
technologies that could improve MHLF ballast efficiency and pass the 
screening criteria discussed above. For further details on these design 
options, see chapter 3 of the final rule TSD.

                               Table V.2--Metal Halide Lamp Fixture Design Options
----------------------------------------------------------------------------------------------------------------
               Ballast type                                 Design option                       Description
----------------------------------------------------------------------------------------------------------------
Magnetic..................................  Improved Core Steel..........................  Use a higher grade of
                                                                                            electrical steel,
                                                                                            including grain-
                                                                                            oriented silicon
                                                                                            steel, to lower core
                                                                                            losses.
                                            Copper Wiring................................  Use copper wiring in
                                                                                            place of aluminum
                                                                                            wiring to lower
                                                                                            resistive losses.
                                            Increased Stack Height.......................  Add steel laminations
                                                                                            to lower core
                                                                                            losses.
                                            Increased Conductor Cross Section............  Increase conductor
                                                                                            cross section to
                                                                                            lower winding
                                                                                            losses.
                                            Electronic Ballast...........................  Replace magnetic
                                                                                            ballasts with
                                                                                            electronic ballasts.
----------------------------------------------------------------------------------------------------------------

Electronic...................................  Improved Components  Magnetics..........  Use grain-oriented or
                                                                                          amorphous electrical
                                                                                          steel to reduce core
                                                                                          losses.
                                                                                         Use optimized-gauge
                                                                                          copper or litz wire to
                                                                                          reduce winding losses.
                                                                                         Add steel laminations
                                                                                          to lower core losses.
                                                                                         Increase conductor
                                                                                          cross section to lower
                                                                                          winding losses.
                                                                    Diodes.............  Use diodes with lower
                                                                                          losses.
                                                                    Capacitors.........  Use capacitors with a
                                                                                          lower effective series
                                                                                          resistance and output
                                                                                          capacitance.
                                                                    Transistors........  Use transistors with
                                                                                          lower drain-to-source
                                                                                          resistance.
                                               Improved Circuit     Integrated Circuits  Substitute discrete
                                                Design.                                   components with an
                                                                                          integrated circuit.
----------------------------------------------------------------------------------------------------------------

C. Engineering Analysis

1. Approach
    The engineering analysis develops cost-efficiency relationships 
depicting the manufacturing costs of achieving increased ballast 
efficiency. DOE applies two methodologies to estimate manufacturing 
costs for the engineering analysis: (1) The design-option approach, 
which provides the incremental costs of adding the design options 
discussed in section V.B of this notice to improve the efficiency of a 
baseline model; and (2) the efficiency-level approach, which estimates 
the costs of achieving increases in ELs through ballast efficiency 
testing, manufacturer catalogs, and teardowns. Details of the 
engineering analysis are in chapter 5 of the final rule TSD. The 
following discussion summarizes the general steps of the engineering 
analysis:
    Determine Representative Equipment Classes. When multiple equipment 
classes exist, to streamline testing and analysis, DOE selects certain 
classes as ``representative,'' primarily because of their high market 
volumes. DOE then scales the ELs from representative equipment classes 
to those equipment classes it does not analyze directly.
    Determine Representative Wattages. Within each representative 
equipment class, DOE also selects a particular wattage fixture as 
``representative'' of the wattage range, primarily because of their 
high market volumes. In this final rule, DOE assigns only one 
representative wattage per representative equipment class.
    Representative Fixture Types. To calculate the typical cost of a 
fixture at each representative wattage, DOE selects certain types of 
fixtures to analyze as representative.
    Select Baseline Units. DOE establishes a baseline unit for each 
representative wattage. The baseline unit has attributes (circuit type, 
input voltage capability, electronic configuration) typical of ballasts 
used in fixtures of that wattage. The baseline unit also has the lowest 
(baseline) efficiency for each representative wattage. DOE measures 
changes resulting from potential amended energy conservation standards 
compared with this baseline. For fixtures subject to existing federal 
energy conservation standards, a baseline unit is a MHLF with a 
commercially available ballast that just meets existing standards. If 
no standard exists for a fixture, the baseline unit is the MHLF at a 
representative wattage with a ballast with the lowest tested ballast 
efficiency that is sold. To determine energy savings and changes in 
price, DOE compares each higher EL with the baseline unit.
    To determine the ballast efficiency, DOE tested a range of MH 
ballasts from multiple ballast manufacturers. In some cases, when test 
data was unavailable, DOE used efficiency values listed in manufacturer 
catalog data sheets. Appendix 5A of the final rule TSD presents the 
test results. When necessary, DOE selects more than one baseline for a 
representative wattage to ensure consideration of different fixture and 
ballast types and their associated customer economics.
    Select More-Efficient Units. DOE selected both commercially 
available MHLFs and modeled MHLFs with higher-than-baseline-efficiency 
ballasts as replacements for each baseline model in each representative 
equipment class. In general, DOE can identify the design options 
associated with each more-efficient ballast model by considering the 
design options that meet the criteria of the screening analysis 
(chapter 4 of the final rule TSD). For electronic ballasts, where 
design options cannot be identified for that class by the product 
number or catalog description, DOE

[[Page 7767]]

conducts testing to determine their efficiency. Appendix 5A of the 
final rule TSD presents these test results. These ballast efficiencies 
were calculated according to the MH ballast test procedures (10 CFR 
431.324), unless otherwise specified. DOE estimates the design options 
likely to be used to achieve a higher efficiency based on information 
gathered during manufacturer interviews and information presented in 
ballast catalogs.
    Determine Efficiency Levels. DOE develops ELs based on: (1) The 
design options associated with the equipment class studied and (2) the 
max-tech EL for that class. As previously noted and as discussed in 
section IV.B.2, DOE's ELs are based on test data collected from 
commercially available equipment, catalog data, manufacturer input, and 
ballast modeling.
    Conduct Price Analysis. DOE generated a bill of material (BOM) by 
disassembling multiple manufacturers' ballasts from a range of ELs and 
fixtures that span a range of applications for each equipment class. 
The BOMs describe the equipment in detail, including all manufacturing 
steps required to make and assemble each part. DOE then developed a 
cost model to convert the BOMs for each representative unit into 
manufacturer production costs (MPCs). By applying derived manufacturer 
markups to the MPCs, DOE calculated the MSPs \28\ and constructed 
industry cost-efficiency curves. In cases where DOE was not able to 
generate a BOM for a given ballast, DOE estimated an MSP based on the 
relationship between teardown data and retail data. DOE also estimated 
ballast and fixture cost adders necessary to allow replacement of more-
efficient substitutes for baseline models.
---------------------------------------------------------------------------

    \28\ The MSP is the price at which the manufacturer can recover 
all production and non-production costs and earn a profit. Non-
production costs include selling, general, and administration (SG&A) 
costs, the cost of R&D, and interest.
---------------------------------------------------------------------------

2. Representative Equipment Classes
    As described in the previous section, DOE selects certain equipment 
classes as ``representative'' to focus its analysis. The 24 equipment 
classes (based on rated lamp wattage, indoor or outdoor designation, 
and test voltage) and the criteria used for development are presented 
in section V.A.2. Due to their low shipment volume (as indicated 
through manufacturer interviews), DOE does not directly analyze the 
equipment classes containing only fixtures with ballasts tested at 480 
V. DOE selected all other equipment classes as representative, 
resulting in a total of 12 representative classes that cover the full 
range of lamp wattages, as well as indoor and outdoor designations. DOE 
had only analyzed 10 representative equipment classes in the NOPR. This 
increase is a result of DOE's decision to split the 501 W-2000 W 
equipment classes into 501 W-1000 W and 1001 W-2000 W. This new 
equipment class structure is discussed in section V.A.2.
3. Representative Wattages
    In the NOPR, DOE selected five representative wattages of MHLFs (70 
W, 150 W, 250 W, 400 W, and 1000 W) to analyze in the engineering 
analysis. Each representative wattage was typically the most commonly 
sold wattage within each equipment class, based on analysis of fixture 
availability from catalogs and manufacturer input.
    As discussed in section V.A.2, DOE has split the 501 W-2000 W 
equipment classes from the NOPR into 501 W-1000 W and 1001 W-2000 W in 
the final rule. From 501 W-1000 W, DOE still finds 1000 W to be an 
appropriate representative wattage based on it being the most commonly 
sold. In the final rule, DOE is analyzing 1500 W as the representative 
wattage for the 1001 W-2000 W equipment classes based on this wattage 
being the most commonly shipped in the wattage range.
4. Representative Fixture Types
    After selecting representative wattages for analysis, DOE 
identified the applications commonly served by each equipment class's 
wattage range in order to select representative fixture types. DOE 
recognizes that technological changes in the ballast caused by 
standards considered in this rulemaking, especially moving from 
magnetic ballasts to electronic ballasts, could necessitate alterations 
to the fixture. These changes often incur additional costs depending on 
the fixture type that needs to be altered. In the engineering analysis, 
DOE estimates a baseline fixture cost, as well as incremental costs to 
the fixture based on the type of ballast used (e.g., electronic 
ballasts require specific fixture adaptations that magnetic ballasts do 
not). The cost adders to the fixtures are discussed in section V.C.12.
    In the NOPR, DOE selected one to three representative fixture types 
for each rated wattage range based on the most common application(s) 
within that range. For the 50 W-100 W range, DOE selected canopy 
fixtures as the representative fixture types. For the 101 W-150 W and 
150 W-250 W range, DOE selected canopy, low bay, and wallpack fixtures 
as representative fixture types. For wattages greater than 250 W, DOE 
chose canopy, flood, and high bay fixtures as representative fixture 
types.\29\
---------------------------------------------------------------------------

    \29\ Descriptions of each of these fixtures types can be found 
in chapter 3 of the final rule TSD.
---------------------------------------------------------------------------

    In this final rule, DOE has expanded its analysis of representative 
fixtures to account for separate uses in indoor and outdoor 
applications. This allows DOE to develop separate prices for indoor and 
outdoor fixtures, taking into account the weather protection built into 
outdoor fixtures. The new representative fixture types, which include 
from one to four applications for each equipment class, are shown in 
Table V.3.

                                                     Table V.3--Representative Wattages and Fixtures
--------------------------------------------------------------------------------------------------------------------------------------------------------
   Designed to be operated with                                                           Representative fixture types
lamps of the following rated lamp     Representative   -------------------------------------------------------------------------------------------------
             wattage                     wattage                             Indoor                                          Outdoor
--------------------------------------------------------------------------------------------------------------------------------------------------------
>=50 W and 100 W and =150 W and 250 W and 500 W and 1000 W and lb losses at 1.5 Tesla 60 Hz sine flux along the grain, 
when losses across the grain for M6 steel in an MH ballast are 
approximately 1.2 W/lb. Furthermore, NEMA and ULT explained that when 
ballast laminations are welded during manufacturing, grain-oriented 
material degrades substantially, and the losses increase. (NEMA, No. 56 
at p. 11; ULT, No. 50 at p. 7) Philips agreed, commenting that the 
watts per pound loss for M6 steel would more than double during the 
manufacturing process, limiting the benefit of using this steel. 
(Philips, Public Meeting Transcript, No. 48 at p. 120) Philips also 
explained that the increase in M6 core losses is because welding 
disrupts the magnetic properties of the material. (Philips, Public 
Meeting Transcript, No. 48 at p. 121) Additionally, NEMA and ULT 
commented that magnetic flux in MH ballasts is not purely sinusoidal, 
rather it also includes harmonic frequencies that increase losses. They 
commented that even relative ratios of the losses provided in the NOPR 
TSD would not work, because data for grain-oriented steels are found 
using the 100 percent along the grain Epstein test, while data for 
cold-rolled steels, such as M19, use the 50 percent Epstein test. This 
50/50 Epstein test takes into account and averages losses along the 
grain and across the grain. Therefore, DOE is not comparing equivalent 
measurements when simply using the already calculated core loss values 
presented in the NOPR. (NEMA, No. 56 at p. 11; ULT, No. 50 at p. 7)
---------------------------------------------------------------------------

    \30\ An Epstein test is a method for evaluating a steel's 
magnetic properties by testing its performance with a standardized 
Epstein frame. During the measurement the Epstein frame, comprising 
a primary and a secondary winding, behaves as an unloaded 
transformer and the power losses are then measured with a wattmeter.
---------------------------------------------------------------------------

    In this final rule, DOE has revised its approach to modeling the 
efficiency of magnetic ballasts. The efficiency of

[[Page 7770]]

commercially available ballasts is established by independent test data 
conducted in accordance with the DOE test procedure, or taken directly 
from a manufacturer's ballast data sheet when test data was 
unavailable. Based on feedback obtained during individual manufacturer 
interviews, DOE assigned design characteristics to these commercially 
available ballasts. Design characteristics included core steel type, 
core mass, wire material, and wire mass. To analyze more-efficient 
ballast designs than those currently on the market, DOE calculated the 
change in efficiency (i.e., change in ballast losses) resulting from a 
substitution of steel type.
    Regarding the core loss calculations, DOE revised its loss values 
for M6 steel in response to the comments received. In the NOPR, the 
losses per pound values for M6 steel were based on alignment of the 
magnetic field longitudinally (in the same direction as the grain 
orientation) to the core steel. However, portions of the magnetic field 
are aligned transverse (perpendicular to the grain orientation) to the 
core steel. The core losses in the transverse orientation are much 
higher. For this final rule, DOE calculated a weighted average of 
longitudinal and transverse losses as the core loss factor for M6 steel 
and found that about one third of losses are in the transverse 
direction. Using this information, DOE calculated the average core 
losses, in W/lb, for M6 steel. See chapter 5 of the final rule TSD for 
additional detail. With this revision, the M6 loss value is comparable 
with the conventional cold-rolled steel (such as M19) 50/50 Epstein-
test-based loss per pound values.
    To calculate the losses associated with an EL2 ballast that uses M6 
steel, DOE first calculated the losses of the EL1 ballast of the same 
wattage, by dividing lamp wattage by ballast efficiency, and then 
subtracting the lamp wattage. Next, DOE calculated the core losses of 
the EL1 ballast based on the mass of the EL1 core and the watts per 
pound loss value associated with the type of steel used in the EL1 
ballast. Then, assuming the footprint and stack height cannot change, 
DOE assumed the EL2 M6 core would have the same mass. DOE therefore 
multiplied the M6 loss per pound value by the mass of the EL1 core to 
calculate the losses assuming an M6 steel substitution. DOE assumed all 
other losses remained constant, and therefore reduced the total EL1 
ballast losses by the incremental decrease in core losses associated 
with the M6 steel. Regarding the 70 W ballasts, this final rule now 
models an increase in ballast efficiency from 76.6 percent to 78.4 
percent, based on the decrease in core losses (and therefore increase 
in ballast efficiency) from M19 to M6 steel. This is a reduction in 
losses of 9.1 percent relative to EL1.
    Regarding the resistive losses in the windings, NEMA and ULT stated 
that DOE's assumption that the current in the primary side of the 
transformer was approximately equal to the input current to the ballast 
is incorrect. This incorrect assumption would lead to calculated losses 
substantially lower than actual losses. (NEMA, No. 56 at p. 11; ULT, 
No. 50 at pp. 7-8) NEMA and ULT pointed out that the current in the 
secondary coil of the transformer does not need to be estimated, as it 
is equal to lamp current. (NEMA, No. 56 at p. 11; ULT, No. 50 at p. 8) 
NEMA and ULT suggested that as lamp current is responsible for winding 
losses, it should be used as a technical parameter when screening 
ballast design options. (NEMA, No. 56 at p. 10; ULT, No. 50 at p. 6)
    DOE agrees with NEMA and ULT's description of current in various 
stages of the magnetic ballast. In an HX ballast, the presence of a 
capacitor in parallel with the primary transformer winding increases 
the current in the primary winding relative to the input current from 
the power source. With the secondary winding, the current is equal to 
the lamp current, which is given in ANSI C78.43-2010. However, for the 
final rule, modeled ELs are only based on substitution of electrical 
steel, assuming all else remains equal. Therefore, the comments 
relating to resistive losses based on current are not applicable to 
DOE's final rule calculations.

Modeled More-Efficient Units

    In the NOPR, DOE used the modeling ballast methodology to calculate 
the efficiency of ballasts more efficient than those currently 
available for sale. NEMA, Philips, and ULT stated that 150 W fixtures 
could not meet the proposed efficiency requirement. (NEMA, Public 
Meeting Transcript, No. 48 at p. 33; Philips, Public Meeting 
Transcript, No. 48 at p. 48; ULT, No. 50 at pp. 23-24) ULT commented 
that an efficiency requirement for 150 W magnetic ballasts higher than 
currently commercially available equipment would practically ban 150 W 
magnetic autotransformer ballasts. (ULT, No. 50 at pp. 23-24) NEMA and 
ULT suggested that DOE made a mistake in considering how magnetic 
ballast efficiency behaves as a result of design considerations. As 
ballast wattage decreases, efficiency loss factors are compounded and 
the ballast size necessary to achieve potential efficiency gains 
increases, making it difficult to further raise the efficiency of 
ballasts 150 W and below. (NEMA, No. 56 at p. 3; ULT, No. 50 at pp. 19-
24) ULT noted that typically, as lamp wattage decreases, so does lamp 
current. As 150 W lamps have higher lamp current than 175 W ballasts, 
it is more difficult for the 150 W ballasts to achieve high 
efficiencies. ULT noted that this relationship is the net effect of 
three main factors: (1) Higher current, (2) increased inductance, and 
(3) wire cross[hyphen]section. In conjunction, these factors make it 
impossible to have an 88 percent efficient 150 W magnetic ballast on a 
3x4 frame. Hence, the industry has not developed a 150 W MHLF with an 
88 percent efficient magnetic autotransformer ballast in response to 
EISA 2007. (ULT, No. 50 at pp. 23-24) Furthermore, ULT stated that as 
ballasts ranging from 50 W to 150 W would need to increase in size in 
order to meet the EL proposed in the NOPR, these ballasts would not fit 
in the fixtures for which they were previously suitable. (ULT, No. 50 
at p. 6) Philips clarified that the increase in size comes from the 
magnetic ballast stack height. Philips noted there are options for 
electronic ballasts, but they are not necessarily interchangeable and 
might be too big for existing fixtures. (Philips, Public Meeting 
Transcript, No. 48 at p. 50)
    DOE notes that the level proposed at 150 W in the NOPR was intended 
to only be met by electronic ballasts, as are all EL3 and EL4 levels in 
both the NOPR and this final rule. DOE agrees with ULT that 150 W 
autotransformer ballasts cannot reach 88 percent efficiency with 
today's technology. In the NOPR, the magnetic ELs were set at 84.0 
percent for EL1 and 86.5 percent for EL2. DOE disagrees that an EL 
above commercially available equipment would ban 150 W magnetic 
ballasts, as improving the core steel to M6, even while maintaining the 
same core footprint and weight, would improve the magnetic ballast 
efficiency beyond commercially available levels. DOE agrees that 150 W 
ballasts have a lower maximum achievable efficiency relative to 175 W 
ballasts, and has analyzed the 150 W fixture exempted by EISA 2007 
accordingly. For this final rule, DOE revised the magnetic ballasts 
analyzed as more efficient replacements for the 150 W representative 
wattage. DOE selected a more common replacement ballast for EL1. At 
EL2, revisions in the magnetic ballast modeling resulted in changes to 
the performance characteristics. In the final rule, as in the NOPR, the 
ballast efficiencies analyzed at both EL1 and EL2 are less than 88 
percent.

[[Page 7771]]

    APPA and NEMA commented that the modeled magnetic ELs are not 
technologically feasible, as modeling and calculations are not proof of 
concept and do not account for variability in manufacturing. (APPA, No. 
51 at pp. 7-8; NEMA, No. 56 at pp. 2, 24) NEMA and ULT also commented 
that the proposed characteristics of the modeled magnetic ballasts are 
based on theories, but have not been proven in manufacturing or 
physical testing and are therefore infeasible and cannot be tested for 
form, fit, or functions compatibility. ULT further asserted that the 
max-tech magnetic levels would require higher grade steel and wire, and 
would therefore increase ballast size. (NEMA, No. 56 at p. 11; ULT, No. 
50 at pp. 4, 8, 30) In addressing the technological feasibility of the 
max-tech levels, NEMA stated that most max-tech levels selected for 
magnetic ballasts are possible only in laboratory conditions, and even 
then only with electronic ballasts. In cases where magnetic ballasts 
could reach the EL, they would need to be enlarged, and might not fit 
in existing fixtures. (NEMA, No. 56 at p. 10) Philips questioned 
whether a modeled product proves technological feasibility. (Philips, 
Public Meeting Transcript, No. 48 at p. 214) Philips also questioned 
whether interviews with manufacturers were enough to constitute an 
assessment of technological feasibility without actual proof. (Philips, 
Public Meeting Transcript, No. 48 at p. 215) NEMA stated that many 
other rulemakings select products of the highest efficiency that are 
already commercially available, as opposed to modeling something that 
has not been produced yet. Philips stated that it is unreasonable to 
think that there would not be other changes required in order to 
implement the modeled product. (Philips, Public Meeting Transcript, No. 
48 at p. 221)
    DOE conducted interviews with individual manufacturers for the NOPR 
analysis and received information through that process describing the 
design characteristics of ballasts more efficient than those currently 
in production. DOE then validated that information by calculating the 
incremental change in losses associated with substituting the 
electrical steel of a commercially available ballast for a higher grade 
of steel. While it is true that the ballasts directly analyzed at EL2 
are not currently commercially available, the design option (M6 steel) 
used to create these ballasts is commercially available. M6 steel 
designs are used for 175 W ballasts with a 3x4 footprint, as evidenced 
by public comment during the preliminary analysis and NOPR phases of 
this rulemaking. In addition, DOE purchased and inspected a 175 W 3x4 
magnetic ballast, and found the lamination thickness (0.14 inches) was 
indicative of M6 steel. DOE has modified its calculations of the 
benefits of M6 steel based on comment received from industry, but 
continues to analyze modeled ballasts for some ELs.
    APPA and NEMA commented that meeting EL2, which DOE based on 
modeled magnetic ballasts, will actually require electronic ballasts. 
APPA and NEMA especially noted that the 91.5 percent efficiency 
requirement for 250 W ballasts is only achievable with electronic 
ballasts. (APPA, No. 51 at pp. 7-8; NEMA, No. 56 at pp. 2, 24) Overall, 
ULT stated that EL2 is too high for magnetic ballasts. (ULT, Public 
Meeting Transcript, No. 48 at p. 137) NEMA and ULT commented that the 
proposed efficiency standards would only be achievable by magnetic 
ballasts in some lab conditions, and would therefore require everything 
less than or equal to 750 W to be redesigned. (NEMA, Public Meeting 
Transcript, No. 48 at pp. 32, 37; NEMA, No. 56 at pp. 2, 10; NEMA, No. 
44 at p. 9; ULT, No. 50 at pp. 2, 4, 10) Therefore, NEMA suggested that 
the max-tech magnetic levels (EL2) of this rule be lower than proposed. 
(NEMA, No. 56 at p. 12) However, the Joint Comment provided a listing 
of various magnetic ballasts capable of meeting the max tech magnetic 
levels (EL2), 13 of which exceeded both EL2 and EL3, and two exceeded 
EL4. (Joint Comment, No. 62 at p. 6) The Joint Comment noted that 
reactor ballasts represent a high-efficiency magnetic alternative to 
electronic ballasts for many applications and urged DOE to model these 
ballasts as the equipment chosen by customers in many cases when the 
standard is set at EL3 or EL4. (Joint Comment, No. 62 at p. 7)
    DOE found that after revising its assumptions for M6 core losses, 
EL2 at 250 W (and other wattages) decreased relative to the NOPR. The 
250 W EL2 is now set at 91.0 percent based on an M6 ballast design. 
DOE's analysis indicates both magnetic ballasts (using M6 steel) and 
electronic ballasts would be compliant with EL2 at 250 W. In response 
to the model list given by the Joint Comment, the commercially 
available magnetic ballasts that were noted as capable of meeting EL2 
were single-voltage reactor ballasts. DOE agrees that there are 
commercially available reactor ballasts that have increased efficiency 
compared to more common magnetic ballast circuit types, but has chosen 
not to model them for EL3 and EL4. Reactor ballasts have limited 
utility due to their single input voltage and reduced ability to 
mitigate input voltage variation relative to HX or CWA ballasts, though 
these limited features do lead to increased efficiency. As discussed in 
section V.C.7 of this notice, DOE bases its analysis on CWA and HX 
magnetic ballasts. DOE has accounted for the thermal and voltage 
transient concerns with electronic ballasts with the design changes 
discussed in section V.C.8 of this notice.

Fixture and Ballast Redesign

    DOE noted in the NOPR that its modeling method would not require 
changes in ballast or fixture size relative to those currently 
commercially available. NEMA, ULT, and GE commented that DOE's 
assumption that proposed ELs will not require changes to the size of 
the ballast is incorrect, especially for ballasts in the 50 W-150 W 
range, noting that the fixtures would need to be replaced to reach 
those levels. (NEMA, No. 56 at p. 14; ULT, No. 50 at p. 6; GE, Public 
Meeting Transcript, No. 48 at p. 190) ULT stated that as the ballast 
size would increase, the proposed financial analysis, and market and 
manufacturer impact, might be incorrect. (ULT, Public Meeting 
Transcript, No. 48 at p. 66) ULT asked how DOE could be sure that 
ballast size would not increase if in some cases ballasts meeting the 
max tech magnetic ELs were not yet commercially available. (ULT, Public 
Meeting Transcript, No. 48 at p. 140) Similarly, NEMA requested that 
DOE explain its assumption that there will be no size increase. (NEMA, 
No. 56 at p. 14) However, CA IOUs and the Joint Comment supported DOE's 
modeled teardown approach as an indicator of potential higher-
efficiency equipment that could be manufactured in the future, and an 
indicator that the max tech magnetic standard levels would not 
necessarily increase ballast size. (CA IOUs, No. 54 at p. 2; Joint 
Comment, No. 62 at p. 6)
    As discussed previously, DOE's modeling approach for magnetic 
ballasts does not change the ballast footprint or stack height relative 
to a commercially available ballast. For example, when modeling an EL2 
magnetic ballast, all parameters remain constant except for a 
substitution of the electrical steel. The cost and efficiency 
associated with the DOE's magnetic ballast analysis is based on the 
constraint that ballast size (footprint and stack height) is not 
allowed to change. As discussed in section V.I of this notice, DOE 
notes that any modifications to fixtures necessary so that the fixture 
can be used in

[[Page 7772]]

conjunction with electronic ballasts can be completed during the 
manufacturing process, and the costs associated with these new 
processes are accounted for in the MIA. This regulation does not 
require retrofitting of MHLFs already installed in the field.
    CA IOUs also illustrated the existence of high efficiency magnetic 
ballasts throughout the wattage ranges, which conflicts with 
manufacturer claims that ELs beyond EL1 could not be achieved by 
magnetic ballasts. (CA IOUs, No. 54 at pp. 3-7) DOE notes that the 
ballasts found with higher than EL1 efficiencies in the CEC database 
were either reactor ballasts or ballasts capable of only one input 
voltage. As discussed in section V.C.7, DOE only identified ballasts 
that were quad-voltage and either CWA or HX as representative. While 
there are more efficient ballasts, if DOE were to set an EL that only 
permitted single input voltage or reactor ballasts then there would be 
significant utility lost.
    NEMA and ASAP cautioned that any standard requiring a larger 
ballast for one wattage will likely require a larger ballast to be 
designed for all wattages within the associated range. This will 
increase the ballast size, weight, and the cost of materials (steel and 
aluminum) for a broad range of equipment--not just the wattage directly 
analyzed. (NEMA, No. 56 at p. 14; ASAP, Public Meeting Transcript, No. 
48 at p. 63) For example, ULT commented that coverage of the 50 W-100 W 
range would require redesign of all magnetic ballasts of that range. 
EEI and Acuity commented that increasing the size of a ballast would 
require increasing the size of the accompanying fixture, which would 
use more natural resources and would impact wind-loading requirements. 
(EEI, Public Meeting Transcript, No. 48 at p. 59; Acuity, Public 
Meeting Transcript, No. 48 at p. 59) ULT further affirmed that bigger 
ballasts would lead to alterations of fixture housing, and thus to a 
complicated replacement process affecting the entire installed base. 
Replacing all the MHLFs currently installed, especially in 
applications, such as light poles, where more than the fixture would 
have to change to accommodate the mounting of a larger ballast, would 
have a negative impact on the whole market. (ULT, Public Meeting 
Transcript, No. 48 at p. 61) APPA noted that altered design 
specifications and wind-loading requirements are significant cost 
adders. (APPA, Public Meeting Transcript, No. 48 at p. 62)
    As stated previously, DOE does not analyze a level that would 
require an increase in ballast size relative to commercially available 
ballasts. All magnetic ballasts are either commercially available, or 
modeled using the size constraints of a commercially available ballast. 
All electronic ballasts analyzed are commercially available. Thus, DOE 
does not find that the ballast efficiencies analyzed in this final rule 
would necessitate an increase in ballast size. Regarding ballast 
weight, electronic ballasts tend to be lighter than magnetic ballasts. 
For fixtures, DOE analyzed the size of fixtures on pole tops (parking/
area fixtures and acorn-style post tops) to determine if any ELs would 
increase the surface area of fixtures to the point of causing concerns 
with wind loading. DOE found no evidence that fixtures listed for only 
magnetic ballasts, versus those listed for both electronic and magnetic 
or only electronic had a systematically different wind resistance 
(effective projected area--surface area of the largest side) or overall 
weight. Thus, DOE does not find that the ballast efficiencies analyzed 
in this final rule would necessitate an increase in fixture size.
    GE commented that manufacturers could choose to rate ballasts 
conservatively (i.e., overdesign the ballast) compared to standards, 
thus providing a cushion between the regulation and the ballasts' 
tested efficiency. This approach would translate into increased size 
and material costs. (GE, Public Meeting Transcript, No. 48 at p. 89)
    DOE acknowledges that manufacturers have flexibility in choosing 
how to design and rate their products. However, DOE does not require 
manufacturers to rate a product at a certain increment above the 
adopted standard level. Therefore, DOE has not accounted for any 
increase in ballast size or material cost that may result from such a 
decision.
b. Electronic Ballasts
    In the NOPR, DOE analyzed electronic ballasts as higher-efficiency 
replacements for magnetic ballasts and based max-tech efficiencies for 
50 W to 500 W MHLFs on commercially available electronic ballasts 
independently tested by DOE. In response to that approach, DOE received 
several comments, discussed below, regarding outdoor transient 
protection, thermal protection, fixture and ballast redesign, 
electronic ballast applications, HFE ballasts, lumen maintenance, and 
other issues.

Transient Protection

    In the NOPR, DOE recognized the necessity for outdoor fixtures to 
be able to withstand large voltage transients, primarily due to 
lightning strikes. While MHLFs with magnetic ballasts are robust and do 
not require any additional devices or enhancements to withstand these 
transients, based on its evaluation of commercially available MHLFs, 
DOE found that fixtures with electronic ballasts usually require 
additional design features in order to have adequate protection. Some 
manufacturers indicated that a portion of their electronic ballasts 
already have 10 kV surge protection built in, but most electronic 
ballasts are only rated for 2.5 kV-6 kV voltage spikes. Though magnetic 
ballasts are known to provide protection in excess of the 10 kV 
specified by the ANSI C62.41.1-2002 Class C rating, for the NOPR DOE 
only considered the cost of meeting the 10 kV requirement.
    NEMA asserted the proposed efficiency standards would lead to a 
shift from magnetic to electronically ballasted fixtures that are more 
susceptible to transient surges. (NEMA, No. 56 at pp. 5-6; NEMA, No. 44 
at p. 9; NEMA, Public Meeting Transcript, No. 48 at pp. 32-33) The 
South Carolina Electric and Gas Company (SCE&G), APPA, NEMA, and ULT 
noted that the need for additional surge protection in outdoor 
applications using electronic ballasts is real, as they will not handle 
transient surges as well as magnetic ballasts. (SCE&G, No. 49 at p. 1; 
APPA, No. 51 at p. 5; NEMA, No. 56 at p. 16; ULT, No. 50 at pp. 9-10) 
Acuity expressed concern that the efficiency standards could preclude 
necessary fixtures used in environments with transient voltage. 
(Acuity, Public Meeting Transcript, No. 48 at p. 162) SCE&G explained 
that magnetic ballasts contain larger coils and steel cores that better 
absorb energy. SCE&G added that the more robust protection required for 
electronic ballasts would add cost and complexity. (SCE&G, No. 49 at p. 
1) Specifically, APPA and NEMA stated that transient surge protection 
would require a much larger front end or an external sacrificial 
device, resulting in additional reengineering cost. (APPA, No. 51 at p. 
6; NEMA, No. 56 at p. 2)
    DOE agrees that electronic ballasts need additional surge 
protection in outdoor applications. In this final rule, DOE continues 
to find that by providing external surge protection up to the 10 kV 
requirement of ANSI C62.41.1-200, electronic ballasts can be used in 
the same outdoor locations as magnetic ballasts. The cost of the 
additional equipment in outdoor applications is added to the total 
fixture MSP (see section V.C.12.c). Using electronic ballasts outdoors 
may also result in increased maintenance or replacement

[[Page 7773]]

costs for the voltage surge protection devices. These costs are 
accounted for in the LCC analysis (section V.F of this notice).
    APPA, NEMA, and ULT noted that while it is not difficult to add 
extra surge protection, it is impossible to predict when the protection 
device will need to be replaced and how many strikes any given surge 
protector can handle over its lifetime before the ballast and lamp are 
affected. APPA, NEMA, and ULT added that voltage transients can be 
variable in severity and timeframe. The current requirements for surge 
protection only cover 10 kV, even though surges of 20 kV are common. 
ULT stated that even with transient protection, electronic ballasts 
would likely not withstand voltage transients as well as magnetic 
ballasts do. When the surge protector has reached the end of its life, 
the next surge will cause the ballast to fail. (APPA, No. 51 at pp. 5, 
6; NEMA, No. 56 at pp. 2, 16; ULT, No. 50 at pp. 12-13. 16). SCE&G 
further commented that resources will be consumed while installing and 
repairing fixtures with electronic ballasts damaged by lightning. 
(SCE&G, No. 49 at p. 1) The Joint Comment agreed that the surge 
protection device might need to be replaced during a fixture's lifetime 
for some fixtures and this additional maintenance and repair cost 
should be analyzed by DOE. (Joint Comment, No. 62 at p. 5)
    DOE has included the cost of transient protection capable of surge 
protection up to 10 kV in its estimates of the initial cost of outdoor 
MHLFs with electronic ballasts, as that is the level specified in ANSI 
C136.2-2004. DOE agrees that one difficulty arising from the addition 
of transient protection to electronic ballasts in voltage transient 
affected areas is the uncertainty in how many strikes the protection 
will be able to absorb and when the protective device will be 
sacrificed and the ballast made vulnerable. This vulnerability will 
affect the maintenance costs and average lifetime of outdoor electronic 
ballasts. See section V.F of this notice for discussion of these costs.
    APPA suggested that DOE take into account data regarding the 
frequency and severity of lightning strikes in the United States and 
revise the forecasts for maintenance costs given the frequency and 
effect of strikes. A lightning strike can affect fixtures within a 
square kilometer, and according to National Lightning Safety Institute 
data, which would affect hundreds of ballasts each year. (APPA, No. 51 
at p. 6) APPA and NEMA noted that besides lightning, there could be 
many other causes of transient surges, such as wind, transmission line 
movement, wind generator surges, equipment or load switching, and 
collapse of sections of a distribution network. (APPA, No. 51 at p. 6; 
NEMA, No. 56 at p. 17) APPA and NEMA urged DOE not to eliminate the 
desirable performance characteristics of magnetic ballasts from the 
market. APPA and NEMA predicted that replacement rates for outdoor 
fixtures would increase significantly for utilities and could cause 
safety and security concerns. (APPA, No. 51 at p. 6; NEMA, No. 56 at p. 
16) Therefore, APPA and NEMA stated that the many causes of transient 
surges make magnetic ballasts necessary in outdoor applications. (APPA, 
No. 51 at p. 6; NEMA, No. 56 at p. 17)
    As discussed previously, DOE has determined that electronic 
ballasts can be used as substitutes for magnetic ballasts when the 
necessary design changes are included. DOE agrees that transient 
protection is a critical consideration, which is why DOE is modeling 
electronically ballasted fixtures sold with transient protection 
devices, and also including transient protection device and ballast 
replacement costs. See section V.F of this notice for details on how 
DOE models the frequency with which outdoor ballasts encounter surges, 
and how those translate directly to increased maintenance and 
replacement costs, and the cost-effectiveness of these measures.
    NEMA and ULT noted that indoor applications also expose ballasts to 
high voltage transients. While transient protection is needed to 
protect against lighting strikes in any outdoor application, it is also 
needed in heavy industrial indoor applications where large machinery 
can send massive transients across the power lines when they are turned 
on. (NEMA, No. 56 at p. 16; ULT, No. 50 at pp. 9-10)
    In researching transient protection for the final rule, DOE found 
that indoor industrial fixtures are also subject to voltage surges. DOE 
has thus included voltage transient protection in its price analysis 
for indoor electronic ballasts experiencing transient surges in these 
industrial applications. Specifically, DOE analyzes the indoor 
industrial applications that require additional surge protection as an 
LCC subgroup. DOE found that indoor industrial MHLFs could experience 
voltage surges up to 6 kV. The voltage transient protection device used 
in DOE's analysis can withstand 120 surges of 3 kV, 18 surges of 6 kV, 
or 5 surges of 10 kV before failure. LCC subgroups are discussed in 
section V.H and the results of the subgroup analysis are presented in 
section VII.B.1.b.

Thermal Protection

    In the NOPR, DOE found that fixtures with electronic ballasts had 
to be designed to tolerate electronic ballasts' higher sensitivity to 
temperatures. Manufacturers must design new and often larger brackets, 
and apply additional potting material, for example, to create an 
adequate thermal contact between the ballast and fixture housing. Based 
on manufacturer feedback and fixture teardown costs, DOE found that 
there was an approximately 20 percent increase in fixture MPCs to 
include thermal management for electronic ballasts.
    Several stakeholders commented on the heat sensitivity of 
electronic ballasts. SCE&G stated that the most serious flaw of the 
electronic MH ballast concept is heat dissipation. The heat sensitivity 
of electronic ballasts would lead to a larger fixture, so that the 
fixture could achieve proper thermal management, adding cost and using 
more resources. (SCE&G, No. 49 at p. 1) One issue identified by 
stakeholders regarding the thermal management of electronic ballasts is 
that electronic ballasts cannot operate in the same temperature 
environments as magnetic ballasts. SCE&G, APPA, and NEMA stated that 
most electronic ballasts have an 80 [deg]C internal operating 
temperature (or case temperature) limit, while their magnetic 
counterparts are in the greater than 180 [deg]C range. (SCE&G, No. 49 
at p. 1; APPA, No. 51 at p. 5; NEMA, No. 56 at pp. 5-6; NEMA, No. 44 at 
p. 9; NEMA, Public Meeting Transcript, No. 48 at pp. 32-33) ULT 
commented that this case temperature limitation results in the 
unavailability of electronic ballasts rated for operation in ambient 
air with a temperature higher than 50 [deg]C. (ULT, No. 50 at pp. 2, 8-
10) APPA and NEMA stated that this poses significant maintenance and 
operations issues for existing fixtures. In some cases, protecting 
against temperature sensitivity would require a utility to move from 
ballast replacement to entire fixture replacement. (APPA, No. 51 at pp. 
5, 8; NEMA, No. 56 at pp. 2, 16, 24) Acuity expressed concern for high 
wattage fixtures used in extreme applications, stating that the 
efficiency standards could preclude necessary fixtures from being 
available for use in environments with high temperatures. (Acuity, 
Public Meeting Transcript, No. 48 at p. 162)
    In addition, several stakeholders noted that the design of existing 
fixtures may create high temperature environments within the fixture 
itself,

[[Page 7774]]

which would be unsuitable for electronic ballasts. Philips commented 
that many MHLFs are designed with the core and coil of the ballast 
directly above the lamp, which creates a high temperature environment 
in which electronic ballasts cannot survive. (Philips, Public Meeting 
Transcript, No. 48 at p. 188) In addition, Philips stated that with 
higher system input power, there are often higher temperature 
environments, and it is difficult to find components, especially 
capacitors, rated at those high temperatures. (Philips, Public Meeting 
Transcript, No. 48 at pp. 194-195) GE questioned whether the EL models 
took into account thermal conditions and luminaire design, or if it 
just assumed the boundary conditions would match the ballast. GE 
ultimately agreed that DOE's model does not include the thermal 
characteristics of the fixture or the boundary conditions. (GE, Public 
Meeting Transcript, No. 48 at pp. 147, 217)
    DOE agrees that thermal protection is required to render electronic 
ballasts suitable substitutes for magnetic ballasts in all 
applications. DOE accounts for this cost in section V.C.12 of this 
final rule. DOE also analyzed the commercially available fixtures that 
are advertised for use with electronic ballasts in outdoor locations. 
In extreme heat conditions, DOE has determined that electronic ballasts 
typically operate up to case temperatures of 80-90 [deg]C. While 
magnetic ballasts themselves are able to handle temperatures as extreme 
as 180 [deg]C, a magnetic ballast must be paired with a capacitor and 
DOE has determined that the capacitor typically only carries a 
temperature rating of about 100 [deg]C. Furthermore, pulse start 
magnetic ballasts must be paired with an igniter in addition to a 
capacitor and DOE has determined that the igniter also typically 
carries a temperature rating of about 100 [deg]C. Based on manufacturer 
interviews and assessment of commercially available fixtures, DOE 
believes that thermal design changes, such as new brackets or 
additional potting material to create an adequate thermal contact 
between the ballast and fixture housing, can address this 10-20 [deg]C 
difference in temperature rating between electronic and magnetic 
ballasts. Therefore in this final rule, as in the NOPR, DOE has 
included a 20 percent increase in fixture MPCs to account for increased 
thermal management for electronic ballasts.
    DOE acknowledges that existing fixtures designed for magnetic 
ballasts may not be suitable for electronic ballasts due to the need 
for increased thermal management. This rulemaking does not require 
retrofits of fixtures currently installed in the field. Any 
modifications to fixture design would be completed by the fixture 
manufacturer and incorporated in any new fixture sales. Fixture 
manufacturers already sell fixtures rated for use with electronic 
ballasts.

Fixture and Ballast Redesign

    When analyzing electronic ballast levels (EL3 and EL4) in the NOPR, 
DOE assumed that the main design changes required to allow electronic 
ballasts were to increase thermal management, add voltage transient 
suppression, and add 120 V auxiliary power functionality. The costs of 
these design changes are discussed in section V.C.12 of this notice. In 
addition to the increased costs associated with these design changes, 
DOE also accounted for manufacturer conversion costs in the MIA.
    ASAP agreed with DOE's methodology in analyzing the challenges and 
costs associated with using electronic ballasts in outdoor 
applications. (ASAP, Public Meeting Transcript, No. 48 at pp. 57, 62) 
CA IOUs and the Joint Comment stated that major manufacturers already 
offer electronic ballasts designed to be used outdoors. Further, 
electronic ballasts generate less internal heat and already make up 
approximately 25 percent of sales for some wattage bins. In addition, 
using the CEC compliance database, CA IOUs illustrated the high 
efficiency and availability of electronic ballasts for indoor and 
outdoor applications. (CA IOUs, No. 54 at pp. 3-7; CA IOUs, Public 
Meeting Transcript, No. 48 at p. 202; Joint Comment, No. 62 at pp. 4-5)
    DOE also received several comments that questioned the feasibility 
of using electronic ballasts in all applications, in particular how 
requiring electronic ballasts could impact the need for ballast and 
fixture redesign. ULT stated that there is a difference between 
commercially available LFE ballasts and commercially available MHLFs 
effectively incorporating such ballasts. (ULT, Public Meeting 
Transcript, No. 48 at p. 204) APPA, the National Rural Electric 
Cooperative Association (NRECA), ULT, and EEI stated that magnetic 
ballasts are better suited to withstand temperature and transient 
extremes, wet locations, heat from the lamp, and would require larger 
fixtures. Therefore, the switch to electronic ballasts would require 
new designs, retooling, and cause a lack of replacements for existing 
fixtures. (APPA, No. 51 at p. 4; NRECA, No. 61 at p. 2; ULT, No. 50 at 
p. 2; EEI, No. 53 at p. 3) NEMA commented further that electronic 
ballasts for outdoor applications would need to be redesigned, and 
hardened and sealed, and thus made larger. (NEMA, No. 56 at p. 6) While 
California has regulations that require electronic ballasts in certain 
situations, NEMA pointed out that efficiency standards in California 
are low enough that the amount of redesign was not as challenging as it 
would be for some of the levels presented in the NOPR. (NEMA, Public 
Meeting Transcript, No. 48 at p. 199)
    Stakeholders further stated that, because of the increased size of 
electronic ballasts and fixtures, there would be significant impacts on 
existing fixtures. APPA, NRECA, ULT, and EEI commented that the switch 
to electronic ballasts would require new designs, retooling, and cause 
a lack of replacements for existing fixtures. (APPA, No. 51 at p. 4; 
NRECA, No. 61 at p. 2; ULT, No. 50 at p. 2; EEI, No. 53 at p. 3) EEI 
elaborated, stating that electronic ballasts used for outdoor fixtures 
are larger and heavier than magnetic ballasts, which would make it 
harder to replace ballasts in existing fixtures. (EEI, No. 53 at p. 3) 
GE asserted that switching to electronic ballasts, especially outdoors, 
would take a great deal of care, attention, design, and development 
because it is not possible to put an electronic ballast into an 
existing magnetic fixture. (GE, Public Meeting Transcript, No. 48 at p. 
198) APPA expressed concern regarding the ability to maintain existing 
infrastructure and Cooper Lighting (Cooper) cautioned against 
replacement fixtures not matching installations. (APPA, Public Meeting 
Transcript, No. 48 at p. 196; Cooper, Public Meeting Transcript, No. 48 
at p. 71) In addition, Cooper commented that lighting fixtures are 
usually UL listed with a certain type of ballast and have fit and 
thermal issues among different suppliers. (Cooper, Public Meeting 
Transcript, No. 48 at p. 74) NEMA asserted the proposed efficiency 
standards would force a shift from magnetic to larger electronic 
ballasts that would not be interchangeable in fixtures. (NEMA, No. 56 
at pp. 5-6; NEMA, No. 44 at p. 9; NEMA, Public Meeting Transcript, No. 
48 at pp. 32-33)
    DOE agrees that there would need to be adjustments made to the MHLF 
system to allow electronic ballasts to be used outdoors. DOE determined 
that electronic ballasts are capable of use outdoors by adding 
transient protection, thermal protection, and using fixtures 
specifically designed to be used outdoors. Outdoor fixtures that use 
electronic ballasts already exist in the marketplace and DOE research 
did not indicate any trend of these fixtures

[[Page 7775]]

being larger than comparable magnetic fixtures for the same wattage 
products. Furthermore, as discussed in section V.C.12, DOE revised its 
methodology for determining fixture pricing to ensure that the costs 
for outdoor fixtures housing electronic ballasts also incorporate the 
necessary weatherization.
    DOE contends that the levels analyzed in this rulemaking will not 
require increases in ballast size. All magnetic ballast levels are 
designed to be achievable with magnetic ballasts commercially available 
or using magnetic ballasts that are the same size as commercially 
available ballasts. When switching to electronic ballasts, DOE notes 
that the sizes and shapes of electronic ballasts are typically 
different from magnetic ballasts (longer length but narrower width), 
but do not increase to a size that would cause concern about their use 
in any applications where magnetic ballasts are used. Any fixture 
redesign that is required to ensure fixtures comply with adopted 
standards was taken into account in the economic analyses of the final 
rule. As discussed above, DOE acknowledges that the surge protection 
device might need to be replaced during the fixture's lifetime and this 
maintenance cost, as well as potential early replacement costs from the 
surge protection being sacrificed and the next strike compromising the 
electronic ballast, are taken into account in the LCC analysis (section 
V.F of this final rule).
    DOE has determined that replacement fixtures should have no issues 
with the adopted standard, as the size and weight of fixtures do not 
need to increase for any of the levels. While certain fixtures may 
require redesign for new ballast types, such as electronic, the overall 
size and weight of fixtures does not increase. DOE agrees that certain 
fixtures are UL listed and have compatibility assured with specific 
types of ballasts--but the ballasts affected by this rulemaking are 
those being placed in new fixtures and not those being used as 
replacements in existing fixtures. Any new fixture sold will be able to 
be cleared for UL listing and compatibility with the ballast included 
in the final assembly.
    Regarding the most efficient levels analyzed, which require 
electronic ballasts, Philips stated that LFE MH ballasts cannot be made 
more efficient than the equipment already available. (Philips, Public 
Meeting Transcript, No. 48 at p. 70) DOE agrees that the efficiency of 
low frequency ballasts cannot be improved beyond that of currently 
commercially available ballasts. DOE's max tech electronic level (EL4) 
is based on commercially available low frequency ballasts.
    In summary, in this final rule, DOE continues to model the cost of 
switching from magnetic ballasts to electronic ballasts, accounting for 
thermal management, transient protection, and general weatherization of 
the fixture in applications in which it is required.

Applications

    Because DOE concluded that electronic ballasts and magnetic 
ballasts could provide the same utility in the wattages that electronic 
ballasts are offered (50 W to 500 W), DOE concluded in the NOPR that 
there was no application unique to magnetic or electronic ballasts. 
With the proper adjustments to the fixture, electronic ballasts could 
be used anywhere magnetic ballasts are used.
    Several manufacturers commented on the prevalence of commercially 
available MHLFs listed for use with electronic ballasts. Cooper 
commented that they only use electronic ballasts in select MHLFs, 
including a very limited number of low-wattage fixtures in some garage 
applications. (Cooper, Public Meeting Transcript, No. 48 at p. 191) GE 
stated that they carry a 400 W electronic ballast, but it is used in 
retail applications with ideal operating conditions. (GE, Public 
Meeting Transcript, No. 48 at p. 191) Philips, on the other hand, 
commented that they make a lot of electronic MH ballasts, anywhere from 
25 W to 400 W, mostly used in retail applications. However, these 
ballasts are primarily for use with CMH lamps and would not be suitable 
in existing fixtures, regardless of lamp type, without significant 
redesign. Philips added that there are no components available for 
applications greater than 400 W and the costs are approximately three 
times higher than magnetic ballasts (Philips, Public Meeting 
Transcript, No. 48 at pp. 192-193, 195) Acuity commented that the only 
applications with which they use electronic ballasts and low-wattage 
fixtures are downlights, cylindrical architectural lighting, and spaces 
meant for low-wattage fixtures where there is good power quality and no 
extreme temperatures. (Acuity, Public Meeting Transcript, No. 48 at p. 
192) CA IOUs clarified that as this ruling applies to new fixtures 
only, they do not see a problem with electronic ballasts being used 
outdoors. (CA IOUs, Public Meeting Transcript, No. 48 at p. 196)
    DOE identified fixtures for sale with electronic ballasts that were 
advertised for and intended for use in outdoor applications, such as 
exterior post top, outdoor area, bollard, canopy, security, and wall 
pack lighting. Manufacturers selling these fixtures did not provide any 
indication that they were to be used in a more limited set of 
applications relative to magnetic ballasts and did not contain warnings 
with regard to particular conditions that should be avoided when using 
those fixtures. For the previously described reasons, DOE has found 
that electronic ballasts can be used in outdoor applications assuming 
the proper adjustments have been made to the fixtures. Any overall 
fixture redesign or conversion costs incurred by the manufacturer to 
switch production to fixtures meeting these levels are accounted for in 
the MIA (see section V.I.4). DOE emphasizes that this rulemaking only 
applies to new fixtures.

High-Frequency Electronic Ballasts

    In the NOPR, DOE analyzed HFE ballasts and determined that they 
were a valid design option to improve ballast efficiency. DOE 
acknowledged the lack of compatibility with CMH lamps, but proposed to 
take those impacts into account when adopting any amended standards.
    NEMA commented that in the 320 W-400 W range, when developing 
electronic ballasts the industry is split between low-frequency square 
wave and high-frequency. (NEMA, Public Meeting Transcript, No. 48 at p. 
28) However, NEMA warned that HFE ballasts are not compatible with all 
MH lamps; the size of the arc tube could lead to acoustic resonance 
problems, which cause arc instability and possible rupture of the arc 
tube. This would lead to compatibility problems where a ballast or lamp 
could not be readily replaced. (NEMA, Public Meeting Transcript, No. 48 
at p. 28) NEMA expressed concern that there would likely be very 
limited lamp models that could be used with these high-efficiency, 
high-frequency ballasts. (NEMA, Public Meeting Transcript, No. 48 at p. 
29; NEMA, No. 56 at p. 15) ULT agreed, commenting that there are 
applications where an electronic ballast will not work and an HFE-only 
standard would therefore be a mistake. (ULT, No. 50 at p. 8)
    DOE agrees that there are compatibility issues with HFE ballasts 
and CMH lamps and that there are no industry standards in place for HFE 
ballasts. As discussed in section III.A.4, DOE has decided to not 
consider standards for HFE ballasts in this rulemaking. Given that HFE 
ballasts are no longer in the scope of the final rule, DOE revised the 
400 W EL4 representative unit to be an LFE ballast. The final rule only 
analyzes LFE ballasts as representative units.

[[Page 7776]]

Lumen Maintenance

    When analyzing the potential energy savings of electronic ballasts 
in the NOPR, DOE only considered the savings that would come from 
increased ballast efficiency. It was assumed that increased ballast 
efficiency when using the same wattage electronic MH system would still 
provide an equivalent light output.
    The Joint Comment expressed its belief that DOE has significantly 
underestimated the energy and economic savings from electronic ballasts 
because lamps driven by electronic ballasts experience better lumen 
maintenance, which allows for fewer fixtures or lower-wattage lamps and 
less frequent re-lamping. (Joint Comment, No. 62 at pp. 1-2) The Joint 
Comment cited the following sources in support of the positive impact 
electronic ballasts have on lumen maintenance: (1) Natural Resources 
Canada stated an electronic ballast produced 15 percent more light 
output after 8000 hours; (2) GE claimed their UltraMaxTM electronic 
ballast produced 13 percent higher mean lumens at 40 percent of rated 
life than an MH system using a pulse-start magnetic ballast; (3) 
Advance claimed that their DynaVision[supreg] electronic ballast 
delivered a 20 percent improvement in lumen maintenance at 40 percent 
of rated life over a pulse-start MH system; and (4) Holophane claimed 
that electronic ballast technology increased mean lumen output by 13 
percent on pulse-start lamps and stated that improved lumen maintenance 
is the most fundamental benefit of electronic HID ballasts. (Joint 
Comment, No. 62 at p. 2)
    DOE researched the potential increase in lumen maintenance when 
switching from magnetic to electronic ballasts. While the comments 
cited several different examples of systems whose lumen maintenance was 
increased with electronic ballasts, DOE did not find universal 
agreement across the industry regarding the impact of electronic 
ballasts on lumen maintenance. While there seemed to be general 
agreement that electronic ballasts may have increased lumen 
maintenance, the literature indicated that specific claims may be 
unique to certain combinations of lamps and ballasts. There is no 
assurance that customers would choose an electronic ballast or lamp 
that would increase lumen maintenance if DOE adopted an electronic 
ballast standard level. As such, DOE maintains the approach from the 
NOPR to only consider the energy savings from increased ballast 
efficiency.

Additional Considerations

    NEMA stated that mandating ELs that preclude any technology but 
pulse-start electronically ballasted MHLFs would cause increased 
maintenance and material costs due to surge and lightning resistance, 
increased fixture size and price, added weather resistance, remote 
igniter installation, and the higher maintenance cost and 
considerations of high-mast lighting fixtures. (NEMA, No. 56 at p. 8) 
APPA and Florida Power and Light were skeptical about electronic 
ballasts being able to withstand all types of outdoor threats, such as 
extreme cold, extreme heat, humidity, salt water, salt air, surge, sag, 
and swell. (APPA, Public Meeting Transcript, No. 48 at p. 196; Florida 
Power and Light, Public Meeting Transcript, No. 48 at p. 204) NEMA 
stated that electronic ballasts would require added capabilities of 
weather resistance, surge resistance, and thermal resilience. (NEMA, 
Public Meeting Transcript, No. 48 at p. 70)
    DOE has accounted for the additional costs at any level requiring 
the use of electronic ballasts. DOE also agrees that electronic 
ballasts used outdoors require general weatherization. To account for 
this, DOE conducted additional fixture teardowns for this final rule to 
come up with a fixture price at each representative wattage that was 
unique for indoor versus outdoor applications. This way the outdoor 
fixtures incorporating electronic ballasts will account for the 
necessary weatherization. Weather resistance, voltage transient 
protection, and thermal protection are incorporated into the full 
fixture MSPs (see section V.C.12). Any potential redesign required of 
manufacturers is considered in the MIA (see section V.I.4). Maintenance 
is considered in the LCC analysis (see section V.F). DOE investigated 
whether a standard that requires an electronic ballast would negatively 
impact high-mast lighting applications using remote ballast placement. 
Some electronic ballasts are capable of starting lamps up to 33 feet, 
but magnetic ballasts can perform remote starting and lamp operation 
from longer distances. Unlike magnetic pulse-start ballasts, the 
ballast to lamp distance cannot be increased with a remote igniter, 
because this remote igniter device is not available for use with 
electronic ballasts. DOE investigated high-mast applications and 
determined some roadway applications with 30 to 40 foot poles could be 
utilizing the remote starting feature. It is unclear what percentage, 
if any, of the 30 to 40 foot poles use remote ballast placement, such 
that the remote starting ability of electronic ballasts would be an 
issue. Further, DOE notes that electronic ballasts are capable of 
starting lamps at distances exceeding 30 feet. The other main category 
of high-mast applications includes those at extreme heights, at least 
100 feet, typical of sports stadium or airfield lighting. These 
applications require fixtures of 1000 W or higher. Because DOE is not 
analyzing efficiency levels that would require electronic ballasts at 
these high wattages, these high-mast, high-wattage MHLFs do not pose a 
concern. In summary, DOE concluded the need for remote starting does 
not necessitate the usage of magnetic ballasts.
    Florida Power and Light commented that electronic ballasts are 
designed to work on a National Electrical Safety Code (NESC) three-wire 
system. However, Florida Power and Light runs a NESC two-wire system 
and is having difficulties with electronic drivers. Florida Power and 
Light stated that they have heard of similar issues from other 
utilities, such as Duke Energy and National Grid, and are very 
concerned about being forced into using electronic ballasts. (Florida 
Power and Light, Public Meeting Transcript, No. 48 at p. 204) DOE 
reviewed manufacturer literature for a variety of electronic ballasts 
and found no requirements that they be used in conjunction with a 
specific wiring scheme. The literature does stipulate that the 
electronic ballast should be grounded to earth, but does not speak to 
preferred or required wiring systems. DOE continued to analyze 
electronic ballasts in outdoor locations for this final rule.
9. Efficiency Levels
    Based on the higher-efficiency ballasts selected for analysis, 
discussed in section V.C.8, DOE developed ELs for the representative 
equipment classes. EL1 represented a moderately higher-efficiency 
magnetic ballast, and EL2 represented the max-tech magnetic ballast. 
EL1 and EL2 were characterized by a combination of commercially 
available and modeled magnetic ballasts. EL3 represented the least 
efficient commercially available electronic ballast, and EL4 
represented the max-tech level for all ballasts incorporated into 
MHLFs. In the NOPR, DOE created four ELs for the equipment classes with 
the 70 W, 150 W, 250 W, and 400 W representative wattages. Due to the 
fact that DOE did not analyze electronic ballasts for the 1000 W 
representative wattage, DOE analyzed only two ELs in the equipment 
class above 500 W.
    NEMA and ULT offered revised efficiency equations, suggesting 
efficiencies lower than the NOPR

[[Page 7777]]

proposed levels. The levels are set with linear equations from 50 to 
150 W and 500 to 1000 W, with a flat efficiency of 88 percent from 150 
to 500 W. (NEMA, No. 56 at pp. 17-19; ULT, No. 50 at pp. 10-11) Philips 
commented that opportunities to further increase efficiency in this 
market have been explored and all economically feasible efficiency 
gains have already been achieved. (Philips, Public Meeting Transcript, 
No. 48 at p. 55) NEMA added to this point, stating that commercial 
markets, such as sports lighting, are already aggressively managing 
their costs and trying to get the most efficient equipment. (NEMA, 
Public Meeting Transcript, No. 48 at p. 56)
    In this final rule, all of the max-tech levels are commercially 
available. All lower ELs analyzed are either commercially available or 
technologically feasible based on DOE's revised ballast modeling. To 
develop efficiency-level equations in this final rule, DOE utilized its 
own efficiency test data as well as catalog efficiency data and 
modeling to develop the equation forms and efficiency trends for each 
wattage range. The efficiency-level equations are generally designed to 
closely match the efficiency of the more-efficient representative units 
identified for each equipment class. The discussion below describes the 
equations used in each wattage bin. For further details, see chapter 5 
of the final rule TSD.
    For the lowest two wattage bins, which consist of 50 W-150 W 
ballasts, DOE used its own test data, as well as efficiency trends 
according to catalog data and modeled more-efficient units, to generate 
separate power-law equations for magnetic (EL1 and EL2) and electronic 
(EL3 and EL4) ballasts.
    The next wattage bin consists of 150 W ballasts, excluding those in 
the currently exempt 150 W fixtures, through and including 250 W 
ballasts. Because EISA 2007 covered equipment in this wattage bin, DOE 
can only evaluate efficiencies equal to or above the existing standards 
to avoid backsliding. 150 W magnetic ballasts cannot be designed to 
meet the EISA 2007 standard of 88 percent efficiency and 175 W ballasts 
only reach 88 percent by using M6 steel. DOE's test data also indicated 
that there are no 150 W or 175 W magnetic ballasts available that 
exceed 88 percent efficiency. Though DOE did not test any 200 W 
ballasts, a review of the CCE database indicates that 200 W ballasts 
are typically only available at about 88 percent efficiency. Because 
DOE has no specific information indicating that these ballasts can be 
designed to be more efficient, DOE assumed that 88 percent is also the 
max-tech magnetic ballast efficiency for wattages up through 200 W. 
Thus, DOE maintained the EISA 2007 efficiency requirement of 88 percent 
for ELs designed to represent levels met by magnetic ballasts. DOE did 
not have any information available about the achievable efficiencies 
for 201 W-250 W ballasts, as ballasts in this range are not 
commercially available. Therefore, DOE gradually increased the magnetic 
ELs (EL1 and EL2) between 200 W and 250 W ballasts using a linear trend 
from 88 percent to the efficiency of the EL1 and EL2 250 W 
representative units. For the electronic ballast levels (EL3 and EL4), 
DOE continued the power-law function fit from the 50 W-150 W range to 
250 W.
    The next wattage bin consists of 251 W-500 W ballasts. Because the 
250 W and 400 W magnetic representative units at EL1 and EL2 have the 
same efficiency and utilize similar design options, DOE created a flat 
efficiency requirement for magnetic ballasts in this wattage bin. For 
the electronic ballast levels (EL3 and EL4), DOE continued the power-
law function fit from the 50 W-250 W range to 500 W.
    The next wattage bin consists of 501 W-1000 W ballasts. DOE 
examined catalog data for market availability and found no electronic 
ballasts for general lighting applications commercially available above 
500 W. Thus, there are only two ELs at this wattage range rather than 
four. NEMA submitted written comments indicating that different groups 
of ballasts have different relationships between lamp current squared 
and lamp wattage. (NEMA, No. 56 at p. 13) Through review of ANSI 
C78.81-2010 and lamp datasheets, DOE found lamps with rated wattages 
between 501 W and 750 W generally had different lamp voltages than 
lamps with rated wattages between 751 W and 1000 W, suggesting a 
difference in ballast efficiency trends across the 750 W threshold. 
Therefore, DOE used linear equations from 501 W-750 W that (1) connect 
to the EL1 and EL2 equations from the 251 W-500 W equipment class, and 
(2) connect to the least efficient 750 W ballasts on the market at 91 
percent. Then from 751 W-1000 W DOE used linear equations that (1) 
connect to 91 percent at the low wattage end, and (2) connect to the 
EL1 and EL2 representative unit efficiencies at 1000 W. This approach 
to the 501 W-1000 W equipment class also has the advantage of 
encouraging purchase of lower wattage ballasts, by ensuring that 
commercially available options remain on the market at EL1 and EL2.
    The highest wattage bin consists of 1001 W-2000 W ballasts. DOE 
again found no electronic ballasts in this wattage range, so there are 
only two levels of efficiency at the highest wattage range rather than 
four. After examining the efficiency trends among commercially 
available ballasts in this wattage bin, DOE used a flat linear equation 
above 1000 W due to the limited data available regarding an efficiency 
trend for these wattages. DOE anchored the line from the previous 
wattage bin's 1000 W efficiencies at EL1 and EL2 and confirmed the 
equation allows the representative units at 1500 W to just meet their 
respective ELs.
    Table V.4 summarizes all of the functions and efficiencies 
describing each equipment class.

[[Page 7778]]

                Table V.4--Efficiency Level Descriptions for the Representative Equipment Classes
----------------------------------------------------------------------------------------------------------------
 
----------------------------------------------------------------------------------------------------------------
   Representative equipment            Rep. wattage            EL       Minimum efficiency equation[dagger] %
            class
----------------------------------------------------------------------------------------------------------------
>=50 W and (1+1.33xP[supcaret](-0.346))[dagger]
                                                            EL2....         1/(1+1.24xP[supcaret](-0.351))
                                                            EL3....        1/(1+0.600xP[supcaret](-0.340))
                                                            EL4....        1/(1+0.360xP[supcaret](-0.297))
>100 W and (1+1.33xP[supcaret](-0.346))
                                                            EL2....         1/(1+1.24xP[supcaret](-0.351))
                                                            EL3....        1/(1+0.600xP[supcaret](-0.340))
                                                            EL4....        1/(1+0.360xP[supcaret](-0.297))
                                                                    --------------------------------------------
>=150 W** and =150 W and 200 W and =150 W and 200 W and (1+0.600xP[supcaret](-0.340))
                                                            EL4....        1/(1+0.360xP[supcaret](-0.297))
>250 W and (1+0.600xP[supcaret](-0.340))
                                                            EL4....        1/(1+0.360xP[supcaret](-0.297))
                                                                    --------------------------------------------
>500 W and 500 W and 750 W and 500 W and 750 W and 1000 W and https://thestc.com/STRates.stm. (Last accessed June 24, 2013.)
---------------------------------------------------------------------------

3. Summary of Markups
    Table V.6 summarizes the markups at each stage in the distribution 
channels and the overall baseline and incremental markups, and sales 
taxes, for each of the three identified channels.

                                               Table V.6--Summary of Fixture Distribution Channel Markups
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                              Wholesaler distribution                          Utility distribution
                                                         -----------------------------------------------------------------------------------------------
                                                                                            Via wholesaler & contractor         Direct to end user
                                                             Baseline       Incremental  ---------------------------------------------------------------
                                                                                             Baseline       Incremental      Baseline       Incremental
--------------------------------------------------------------------------------------------------------------------------------------------------------
Electrical Wholesaler (Distributor).....................            1.23            1.05           (\1\)           (\1\)           (\1\)           (\1\)
Utility.................................................           (\1\)           (\1\)            1.00            1.00            1.00            1.00
Contractor or Installer.................................            1.13            1.13            1.13            1.13           (\1\)           (\1\)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Sales Tax...............................................               1.07
                                                                       1.07
                                                                       1.07
                                                         -----------------------------------------------------------------------------------------------
Overall.................................................            1.49            1.27            1.21            1.21            1.07            1.07
--------------------------------------------------------------------------------------------------------------------------------------------------------
\1\ Not applicable.

[[Page 7784]]

    Using these markups, DOE generated fixture end-user prices for each 
EL it considered, assuming that each level represents a new minimum 
efficiency standard. Chapter 6 of the final rule TSD provides 
additional detail on the markups analysis.

E. Energy Use Analysis

    For the energy use analysis, DOE estimated the energy use of metal 
halide lamp fixtures in actual field conditions. The energy use 
analysis provided the basis for other DOE analyses, particularly 
assessments of the energy savings and the savings in operating costs 
that could result from DOE's adoption of new and amended standard 
levels.
    To develop annual energy use estimates for the August 2013 NOPR, 
DOE multiplied annual usage (in hours per year) by the lamp-and-ballast 
system input power (in watts). DOE characterized representative lamp-
and-ballast systems in the engineering analysis, which provided 
measured input power ratings. To characterize the country's average use 
of fixtures for a typical year, DOE developed annual operating hour 
distributions by sector, using data published in the 2010 LMC, the 
Commercial Building Energy Consumption Survey (CBECS),\34\ and the 
Manufacturer Energy Consumption Survey (MECS).\35\ 78 FR 51464, 51501 
(Aug. 20, 2013).
---------------------------------------------------------------------------

    \34\ U.S. Department of Energy, Energy Information Agency. 
Commercial Building Energy Consumption Survey: Micro-Level Data, 
File 2 Building Activities, Special Measures of Size, and Multi-
building Facilities. 2003. Available at www.eia.doe.gov/emeu/cbecs/public_use.html.
    \35\ U.S. Department of Energy, Energy Information Agency. 
Manufacturing Energy Consumption Survey, Table 1.4: Number of 
Establishments Using Energy Consumed for All Purposes. 2006. 
Available at www.eia.doe.gov/emeu/mecs/mecs2006/2006tables.html.
---------------------------------------------------------------------------

    Musco Lighting and NEMA commented that metal halide lamp fixtures 
over 1000 W-particularly 1500 W fixtures--are principally confined to 
sports lighting applications, and Musco Lighting noted that their 
monitoring data indicates average usage of 250 hours per year for these 
fixture types. (Musco Lighting, No. 55 at pp. 1, 4; NEMA, No. 56 at pp. 
6-7) The CA IOUs stated that high-wattage MH fixtures are also commonly 
used in high mast applications, with operating hours similar to other 
outdoor lighting applications. (CA IOUs, No. 54 at p. 2) DOE 
acknowledges that high-wattage MH fixtures may be used in high mast 
applications but notes that the 2010 LMC indicates an average MH lamp 
wattage of less than 250 W for roadway and parking applications, 
suggesting a negligible contribution by high mast lighting. As 
discussed in section V.A.2, DOE created a separate 1500 W equipment 
class for this final rule to address the unique design features and 
application of these fixture types. Musco did not provide detailed 
operating hours data with their written comments; however, NEMA cited 
the 2010 LMC estimate of 1 hour per day for stadium lighting as 
reasonable for MHLF applications greater than 1000 W. DOE agrees with 
NEMA that this 2010 LMC estimate is reasonable for sports lighting 
applications, and DOE assumed annual operation of 350 hours per year 
(based on the actual LMC value of 0.958 hours per day) for the 1500 W 
equipment class in its final rule energy use analysis.
    The August 2013 NOPR analysis assumed full operating power and no 
dimmed operation to estimate MHLF energy use. 78 FR 51464, 51502 (Aug. 
20, 2013). DOE received no comments regarding its operating power 
assumption, and retained its approach for the energy use analysis in 
today's final rule. Chapter 7 of the final rule TSD provides a more 
detailed description of DOE's energy use analysis.

F. Life-Cycle Cost and Payback Period Analyses

    DOE conducted the LCC and PBP analysis to evaluate the economic 
effects of potential energy conservation standards for metal halide 
lamp fixtures on individual customers. For any given efficiency level, 
DOE measured the PBP and the change in LCC relative to an estimated 
baseline equipment efficiency level. The LCC is the total customer 
expense over the life of the equipment, consisting of purchase, 
installation, and operating costs (expenses for energy use, 
maintenance, and repair). To compute the operating costs, DOE 
discounted future operating costs to the time of purchase and summed 
them over the lifetime of the equipment. The PBP is the estimated 
amount of time (in years) it takes customers to recover the increased 
purchase cost (including installation) of more efficient equipment 
through lower operating costs. DOE calculates the PBP by dividing the 
change in purchase cost (normally higher) by the change in average 
annual operating cost (normally lower) that results from the more 
efficient standard.
    Inputs to the calculation of total installed cost include the cost 
of the equipment--which includes MSPs, distribution channel markups, 
and sales taxes--and installation costs. Inputs to the calculation of 
operating expenses include annual energy consumption, energy prices and 
price projections, repair and maintenance costs, equipment lifetimes, 
discount rates, and the year that compliance with new and amended 
standards is required. To account for uncertainty and variability, DOE 
created distributions for selected inputs, including operating hours, 
equipment lifetimes, electricity prices, discount rates, and sales tax 
rates. For example, DOE created a probability distribution of annual 
energy consumption in its energy use analysis, based in part on a range 
of annual operating hours. The operating hour distributions capture 
variations across building types, lighting applications, and metal 
halide systems for three sectors (commercial, industrial, and outdoor 
stationary). In contrast, fixture MSPs were specific to the 
representative designs evaluated in DOE's engineering analysis, and 
price markups were based on limited publicly available financial data. 
Consequently, DOE used discrete values instead of distributions for 
these inputs.
    The computer model DOE uses to calculate the LCC and PBP, which 
incorporates Crystal Ball (a commercially available software program), 
relies on a Monte Carlo simulation to incorporate uncertainty and 
variability into the analysis. The Monte Carlo simulations randomly 
sample input values from the probability distributions and fixture user 
samples. The final rule TSD chapter 8 and its appendices provide 
details on the spreadsheet model and all the inputs to the LCC and PBP 
analysis.
    Table V.7 summarizes the approach and data DOE used to develop 
inputs to the LCC and PBP calculations for the August 2013 NOPR as well 
as the changes made for today's final rule. The subsections that follow 
discuss the calculation inputs and DOE's changes to them.

[[Page 7785]]

                 Table V.7--Summary of Inputs and Key Assumptions in the LCC and PBP Analysis *
----------------------------------------------------------------------------------------------------------------
             Inputs                                   NOPR                         Changes for the final rule
----------------------------------------------------------------------------------------------------------------
Equipment Cost..................  Derived by multiplying MHLF MSPs by          No change.
                                   distribution channel markups and sales tax.
Installation Cost...............  Calculated costs using estimated labor       Calculated costs using estimated
                                   times and applicable labor rates from ``RS   labor times and applicable labor
                                   Means Electrical Cost Data'' (2009) and      rates from ``RS Means Electrical
                                   U.S. Bureau of Labor Statistics.             Cost Data'' (2013); Sweets
                                                                                Electrical Cost Guide 2013; and
                                                                                U.S. Bureau of Labor Statistics.
Annual Energy Use...............  Determined operating hours separately for    No change.
                                   indoor and outdoor fixtures. Used lighting
                                   market data: 2010 LMC (2012).
Energy Prices...................  Electricity: Based on EIA's Form 826 data    No change.
                                   for 2012.
                                  Variability: Energy prices determined at
                                   state level; incorporated off-peak
                                   electricity prices in the Monte Carlo
                                   analysis.
Energy Price Projections........  Projected using AEO2013....................  No change.
Replacement Costs...............  Included labor and material costs for lamp   No change.
                                   and ballast replacement through the end of
                                   their lifetimes.
Equipment Lifetime..............  Ballasts: Assumed 50,000 hours for magnetic  Ballasts: No change.
                                   ballasts and 40,000 hours for electronic
                                   ballasts.
                                  Fixtures: Assumed 20 years for indoor        Fixtures: No change.
                                   fixtures and 25 years for outdoor fixtures.
                                  Variability: Incorporated lamp and ballast   Variability: Incorporated lamp,
                                   lifetimes in the Monte Carlo analysis.       ballast and fixture lifetimes in
                                                                                the Monte Carlo analysis.
Discount Rates..................  Commercial/Industrial: Developed a           Commercial/Industrial: No change.
                                   distribution of discount rates for each
                                   end-use sector.
                                  Outdoor Stationary: Developed a              Outdoor Stationary: No change.
                                   distribution of discount rates for each
                                   end-use sector.
----------------------------------------------------------------------------------------------------------------
* References for the data sources mentioned in this table are provided in the sections following the table or in
  chapter 8 of the final rule TSD.

1. Equipment Cost
    To calculate customer equipment costs, DOE multiplied the MSPs 
developed in the engineering analysis by the distribution channel 
markups described in section V.D.1 (along with sales taxes). DOE used 
different markups for baseline equipment and higher efficiency 
equipment because the markups estimated for incremental costs differ 
from those estimated for baseline models. For the August 2013 NOPR, DOE 
also examined historical price data for various appliances and 
equipment that--along with economic literature--suggest that the real 
costs of these products may in fact trend downward over time, partially 
because of ``learning'' or ``experience.'' \36\ 78 FR 51464, 51503 
(Aug. 20, 2013).
---------------------------------------------------------------------------

    \36\ A draft paper, Using the Experience Curve Approach for 
Appliance Price Forecasting, posted on the DOE Web site at 
www.eere.energy.gov/buildings/appliance_standards, provides a 
summary of the data and literature currently available to DOE that 
is relevant to price forecasts for selected appliances and 
equipment.
---------------------------------------------------------------------------

    On February 22, 2011, DOE published a notice of data availability 
(February 2011 NODA; 76 FR 9696) stating that DOE may consider 
improving regulatory analysis by addressing equipment price trends. DOE 
notes that learning-curve analysis characterizes the reduction in 
production cost mainly associated with labor-based performance 
improvement and higher investment in new capital equipment at the 
microeconomic level. Experience-curve analysis tends to focus more on 
entire industries and aggregates over various causal factors at the 
macroeconomic level: ``Experience curve'' and ``progress function'' 
typically represent generalizations of the learning concept to 
encompass behavior of all inputs to production and cost (i.e., labor, 
capital, and materials). The economic literature often uses these two 
terms interchangeably. The term ``learning'' is used here to broadly 
cover these general macroeconomic concepts.
    For the August 2013 NOPR and consistent with the February 2011 
NODA, DOE examined two methods for estimating price trends for metal 
halide lamp fixtures: using historical producer price indices (PPIs), 
and using projected price indices (called deflators). With PPI data, 
DOE found both positive and negative real price trends, depending on 
the specific time period examined, and did not use this method to 
adjust fixture prices. DOE instead adjusted fixture prices using 
deflators used by EIA to develop the AEO2011. When adjusted for 
inflation, the deflator-based price indices decline from 100 in 2010 to 
approximately 75 in 2046. 78 FR 51464, 51503 (Aug. 20, 2013).
    DOE received no comments related to equipment price trends, and 
retained its deflator-based approach to adjust fixture prices for this 
final rule. Using updated (AEO2013) deflators, DOE estimated that the 
price indices decline from 100 in 2010 to approximately 90 in 2046. A 
more detailed discussion of price trend modeling and calculations is 
provided in appendix 8B of the final rule TSD.
2. Installation Cost
    Installation costs for metal halide lamp fixtures include the costs 
to install the fixture, maintain the ballast, and replace the lamp. For 
the August 2013 NOPR, DOE used data collected for its July 2010 HID 
lamps determination,\37\ labor rates for electricians from RS 
Means,\38\ and other research to estimate the installation costs. DOE 
assumed that installation costs varied between equipment classes as a 
function of fixture size and mounting locations but were the same 
between efficiency levels within a given equipment class. For 
maintenance costs, DOE employed a methodology that allows the use of 
annualized maintenance costs while maintaining the integrity of the NPV 
calculations in the NIA. 78 FR 51464, 51503 (Aug. 20, 2013).
---------------------------------------------------------------------------

    \37\ U.S. Department of Energy-Office of Energy Efficiency and 
Renewable Energy. Energy Conservation Program for Consumer 
Equipment: Preliminary Technical Support Document: High-Intensity 
Discharge Lamps. 2010. Washington, DC. Available at 
www1.eere.energy.gov/buildings/appliance_standards/product.aspx/productid/60>.
    \38\ R.S. Means Company, Inc. 2010 RS Means Electrical Cost 
Data. 2010. Kingston, MA.
---------------------------------------------------------------------------

    DOE received comments that larger ballasts and housings--and larger 
poles required for outdoor fixtures--would increase costs and payback 
periods for higher-efficiency designs. (Acuity Brands, Public Meeting 
Transcript, No. 48 at p. 60; GE, Public Meeting

[[Page 7786]]

Transcript, No. 48 at pp. 231-232; NEMA, No. 56 at p. 2) As discussed 
previously in section V.C of this final rule, DOE's engineering 
analysis indicated that higher-efficiency fixture designs would not 
incur significant increases in housing size, effective projected area, 
or required pole size. DOE, therefore, did not include the added cost 
of larger poles in the installation costs for higher efficiency fixture 
designs. For this final rule, DOE also referenced Sweets Electrical 
Cost Guide \39\ in developing installation cost estimates for the LCC 
and PBP analysis. For further detail, see chapter 8 of the final rule 
TSD.
---------------------------------------------------------------------------

    \39\ Sweets-McGraw Hill Construction. Sweets Electrical Cost 
Guide 2013. 2012. Vista, CA.
---------------------------------------------------------------------------

3. Annual Energy Use
    As discussed in section V.E, DOE estimated the annual energy use of 
representative metal halide systems using system input power ratings 
and sector operating hours. For the August 2013 NOPR, DOE based the 
annual energy use inputs to the LCC and PBP analysis on weighted 
average annual operating hours. 78 FR 51464, 51503 (Aug. 20, 2013). For 
this final rule, DOE based the annual energy use inputs on sectoral 
operating hour distributions (commercial, industrial, and outdoor 
stationary sectors), with the exception of a discrete value (350 hours 
per year) for the 1500 W equipment class that is primarily limited to 
sports lighting. DOE used operating hour (and, by extension, energy 
use) distributions to better characterize the potential range of 
operating conditions faced by MHLF customers.
4. Energy Prices
    For the August 2013 NOPR, DOE estimated electricity prices for 
commercial, industrial and outdoor stationary sectors by state using 
data from EIA Form 826, ``Monthly Electric Utility Sales and Revenue 
Data, 2011.'' 78 FR 51464, 51503 (Aug. 20, 2013). DOE received no 
comments related to electricity prices and used 2012 data for this 
final rule. For more information, see chapter 8 of the final rule TSD.
5. Energy Price Projections
    To estimate the trends in energy prices, DOE used the price 
projections in AEO2013. To arrive at prices in future years, DOE 
multiplied current average prices by the projected annual average price 
changes in AEO2013. Because AEO2013 projects prices to 2040, DOE used 
the average rate of change from 2030 to 2040 to estimate the price 
trend for electricity after 2040. In addition, the spreadsheet tools 
that DOE used to conduct the LCC and PBP analysis allow users to select 
price forecasts from the AEO low-growth, high-growth, and reference-
case scenarios to estimate the sensitivity of the LCC and PBP to 
different energy price forecasts. 78 FR 51464, 51504 (Aug. 20, 2013). 
DOE received no comments related to energy price projections, and 
retained its approach for this final rule. For more information, see 
chapter 8 of the final rule TSD.
6. Replacement Costs
    In the August 2013 NOPR, DOE addressed ballast and lamp 
replacements that occur within the LCC analysis period. Replacement 
costs include the labor and materials costs associated with replacing a 
ballast or lamp at the end of their lifetimes and are annualized across 
the years preceding and including the actual year in which equipment is 
replaced. For the LCC and PBP analysis, the analysis period corresponds 
with the fixture lifetime that is assumed to be longer than that of 
either the lamp or the ballast. For this reason, ballast and lamp 
prices and labor costs are included in the calculation of total 
installed costs.
    DOE received numerous comments indicating that electronic HID lamp 
ballasts require additional voltage transient (surge) protection, in 
comparison to magnetic ballasts. High-voltage transients could result 
from, e.g., lightning or wind effects and could shorten electronic 
ballast life in outdoor applications. (APPA, No. 51 at pp. 5-7; CA 
IOUs, No. 54 at p. 4; FP&L, Public Meeting Transcript, No. 48 at pp. 
232-233; NEMA, No. 56 at pp. 16-17; ULT, No. 50 at p. 13; SCE&G, No. 49 
at p. 1) NEMA stated that voltage transients are also a concern in 
indoor heavy industrial applications. (NEMA, No. 56 at p. 16) Several 
commenters also stated that it is not possible to determine when 
transient protection has reached its end of life, other than when it 
fails and causes a ballast failure in the process. (APPA, No. 51 at p. 
5; NEMA, No. 56 at p. 16; Universal, No. 50 at p. 13) ASAP and GE 
suggested that transient-induced failures and maintenance should also 
be addressed in the LCC and PBP analysis. (ASAP, No. 62 at p. 5; GE, 
Public Meeting Transcript, No. 48 at p. 248)
    For this final rule, DOE examined the potential effects of voltage 
transients on electronically ballasted fixtures in outdoor and heavy 
industrial indoor applications. As discussed previously in section V.C 
of this final rule, DOE's engineering analysis considers the additional 
cost of transient protection in determining the total cost for fixtures 
using electronic ballasts. DOE assumed that outdoor fixtures of all 
wattages could face transient-induced damage, and that industrial 
indoor fixtures in the 250 W and 400 W equipment classes were most 
susceptible to voltage transients, based on 2010 LMC data for average 
HID lamp wattages in indoor applications.
    For outdoor fixtures, DOE examined data on the frequency and 
geographic distribution of lightning strikes from the National 
Lightning Safety Institute \40\ and other sources to estimate 
additional surge protection and ballast replacements due to voltage 
transients. Lightning is more prevalent in the southern and lower 
midwestern regions of the United States, which leaves high 
concentrations of outdoor lighting fixtures, e.g., in western and 
northeastern metropolitan areas, less affected by lightning. On a 
national level, DOE estimated that direct lightning strikes would be 
exceedingly rare--approximately 0.01 strikes per year on average, or 
approximately 1 direct strike per 100 years. DOE estimated that ``near-
strikes,'' which occur within a larger radius of the fixture and may be 
survivable by a protected electronic ballast, are also rare--
approximately 0.04 strikes per year on average, or approximately 1 
near-strike per 25 years. DOE, therefore, considered the probability of 
lightning-induced ballast replacements to be negligible for the average 
MHLF customer and did not consider this replacement event in its main 
LCC and PBP analysis. DOE expects that MHLF customers in lightning-
prone areas will experience a higher probability of transient-induced 
ballast failures, and DOE estimated the related LCC and PBP effects in 
its subgroup analysis (see section V.H of this final rule).
---------------------------------------------------------------------------

    \40\ National Lightning Safety Institute. See http://lightningsafety.com.
---------------------------------------------------------------------------

    For indoor applications, DOE assumed some 250 W and 400 W 
electronically ballasted fixtures were used in heavy industrial 
settings susceptible to voltage transients. The 2010 Lighting Market 
Characterization estimates that 434 W is the average wattage of metal 
halide lamps in the industrial sector. This means the vast majority of 
metal halide lamp fixtures in the industrial sector range between 250 W 
to 1000 W. The engineering analysis only proposed electronic ballasts 
for 250 W and 400 W light fixtures--thus those fixture types were the 
only types analyzed the LCC subgroup analysis. DOE's research 
determined that 60-80 percent of interior transients are

[[Page 7787]]

generated by equipment (e.g., elevators, machinery, air-conditioners) 
within the building. The magnitude of the transients generated ranged 
in size as did the frequency of the transients. Transient voltage surge 
suppressors (known mostly as TVSS) and/or other surge protection 
devices have become more common in industrial buildings. DOE found 
electronic fluorescent ballasts (although a different technology, an 
example of what can be accomplished) that manufacturers claimed could 
survive in industrial settings. DOE assumed that transients could 
reduce the life of electronic metal halide ballasts by 20 percent and 
thus modeled this reduction in the LCC subgroup analysis. DOE, 
therefore, considered the probability of transient-induced surge 
protection and ballast replacements to be negligible for the average 
MHLF customer and did not consider this replacement event in its main 
LCC and PBP analysis. DOE expects that some MHLF customers in heavy 
industrial indoor applications areas will experience a higher 
probability of transient-induced surge protection and ballast failures, 
and DOE estimated the related LCC and PBP effects in its subgroup 
analysis (see section V.H of this final rule).
    For more information regarding replacement costs, see chapter 8 of 
the final rule TSD.
7. Equipment Lifetime
    For the August 2013 NOPR, DOE defined equipment lifetime as the age 
(in hours in operation) when a fixture, ballast, or lamp is retired 
from service. The time period used for the LCC and PBP analysis in this 
rulemaking is the average lifetime of the baseline metal halide lamp 
fixture. For fixtures in all equipment classes, DOE assumed average 
lifetimes for indoor and outdoor fixtures of 20 and 25 years, 
respectively.
    Metal halide lamp fixtures are operated by either magnetic or 
electronic ballasts. In the August 2013 NOPR, DOE assumed that magnetic 
ballasts last for 50,000 hours and electronic ballasts last for 40,000 
hours. Similarly, MH lamp lifetimes vary by lamp technology and 
equipment class. DOE assumed that ballast and lamp lifetimes can vary 
due to both physical failure and economic factors (e.g., early 
replacements due to retrofits); consequently, DOE accounted for 
variability in lifetimes in LCC and PBP via the Monte Carlo simulation, 
and in the shipments and NIA analyses by assuming a Weibull 
distribution for lifetimes to accommodate failures and 
replacements.\41\ 78 FR 51464, 51504 (Aug. 20, 2013).
---------------------------------------------------------------------------

    \41\ Weibull distribution is a probability density function; for 
more information, see www.itl.nist.gov/div898/handbook/eda/section3/eda3668.htm.
---------------------------------------------------------------------------

    DOE received comments that its analysis unfairly penalized 
electronically ballasted designs by modeling an additional ballast 
replacement late in the fixture lifetime. For example, a customer with 
an electronically ballasted indoor fixture (20-year lifetime) would 
have to install a second replacement ballast approximately 2 years 
before retiring the fixture, which the commenters considered 
unrealistic. In comparison, a customer with a magnetically ballasted 
fixture would face only one ballast replacement, given the longer 
ballast lifetime. To more fairly model the late ballast replacements, 
the commenters suggested assigning a residual value to remaining 
ballast life at the end of the fixture's life. (ASAP, No. 62 at pp. 3-
4; CA IOUs, No. 54 at pp. 4-5) DOE agrees with this approach, and 
included the residual value remaining in both lamps and ballasts in its 
LCC and PBP analysis. ASAP also suggested an alternative that uses a 
distribution of fixture lifetimes in the LCC and PBP analysis instead 
of a single average value. (ASAP, No. 62 at p. 4) DOE agrees with the 
use of a distribution of fixture lifetimes, which captures both early 
fixture failures (avoiding a second ballast replacement) and customers 
using fixtures beyond the average lifetimes (more fully using the 
second replacement ballast). For this final rule, DOE used a 
distribution of fixture, ballast, and lamp lifetimes as inputs to its 
LCC and PBP analysis.
    For more information regarding equipment lifetimes, see chapter 8 
of the final rule TSD.
8. Discount Rates
    The discount rate is the rate at which future expenditures are 
discounted to estimate their present value. In this final rule, DOE 
estimated separate discount rates for commercial, industrial, and 
outdoor stationary applications. For all related customers, DOE 
estimated the cost of capital for commercial and industrial companies 
by examining both debt and equity capital, and DOE developed an 
appropriately weighted average of the cost to the company of equity and 
debt financing. For this final rule, DOE also developed a distribution 
of discount rates for each end-use sector from which the Monte Carlo 
simulation samples.
    For each sector, DOE assembled data on debt interest rates and the 
cost of equity capital for representative firms that use metal halide 
lamp fixtures. DOE determined a distribution of the weighted-average 
cost of capital for each class of potential owners using data from the 
Damodaran online financial database.\42\ The average discount rates, 
weighted by the shares of each rate value in the sectoral 
distributions, are 4.9 percent for commercial end users, 4.7 percent 
for industrial end users, and 3.4 percent for outdoor stationary end 
users.
---------------------------------------------------------------------------

    \42\ The data are available at pages.stern.nyu.edu/~adamodar. 
(Last accessed August 21, 2013.)
---------------------------------------------------------------------------

    For more information regarding discount rates, see chapter 8 of the 
final rule TSD.
9. Analysis Period Fixture Purchasing Events
    DOE designed the LCC and PBP analysis for this rulemaking around 
scenarios where customers need to purchase a metal halide lamp fixture. 
The ``event'' that prompts the purchase of a new fixture (either a 
ballast failure or new construction/renovation) was assumed to 
influence the cost-effectiveness of the customer purchase decision. DOE 
assumed that a customer will replace a failed fixture with an identical 
fixture in the base case, or a new standards-compliant fixture with 
comparable light output in the standards case. DOE analyzed six 
representative equipment classes for fixtures and presented the results 
for each of these representative equipment classes by fixture 
purchasing event, which influenced the LCC and PBP results.
    For more information regarding fixture purchasing events for the 
LCC analysis, see chapter 8 of the final rule TSD.

G. National Impact Analysis--National Energy Savings and Net Present 
Value Analysis

    DOE's NIA assessed the national energy savings (NES) and the 
national net present value (NPV) of total customer costs and savings 
that would be expected to result from new or amended standards at 
specific efficiency levels.
    DOE used a Microsoft Excel spreadsheet model to calculate the 
energy savings and the national customer costs and savings from each 
TSL. The TSD and other documentation for the rulemaking help explain 
the models and how to use them, enabling interested parties to review 
DOE's analyses by changing various input quantities within the 
spreadsheet.

[[Page 7788]]

    DOE used the NIA spreadsheet to calculate the NES, and the NPV of 
costs and savings, based on the annual energy use and total installed 
cost data from the energy use and LCC analyses. DOE projected the 
energy savings, energy cost savings, equipment costs, and NPV of 
customer benefits for each equipment class for equipment sold from 2017 
through 2046. The projections provided annual and cumulative values for 
all four output parameters.
    DOE evaluated the impacts of new and amended standards for metal 
halide lamp fixtures by comparing base-case projections with standards-
case projections. The base-case projections characterize energy use and 
customer costs for each equipment class in the absence of new or 
amended energy conservation standards. DOE compared these projections 
with projections characterizing the market for each equipment class if 
DOE adopted new or amended standards at specific energy efficiency 
levels (i.e., the TSLs or standards cases) for that class. In 
characterizing the base and standards cases, DOE considered historical 
shipments, the mix of efficiencies sold in the absence of new 
standards, and how that mix may change over time. Additional 
information about the NIA spreadsheet is in the final rule TSD chapter 
11.
    Table V.8 summarizes the approach and data DOE used to derive the 
inputs to the NES and NPV analyses for the August 2013 NOPR, as well as 
the changes to the analyses for the final rule. A discussion of 
selected inputs and changes follows. See chapter 11 of the final rule 
TSD for further details.

      Table V.8--Approach and Data Used for National Energy Savings and Customer Net Present Value Analyses
----------------------------------------------------------------------------------------------------------------
                Inputs                                Proposed rule                 Changes for the final rule
----------------------------------------------------------------------------------------------------------------
Shipments.............................  Developed annual shipments from           See Table V.9.
                                         shipments model.
Annual Energy Consumption per Unit....  Established in the energy use analysis    See section V.E.
                                         (NOPR TSD chapter 7).
Rebound Effect........................  0%......................................  No change.
Electricity Price Forecast............  AEO2013.................................  No change.
Energy Site-to-Source Conversion        Used annually variable site kWh to        No change.
 Factor.                                 source Btu conversion factor.
Discount Rate.........................  3% and 7% real..........................  No change.
Present Year..........................  2013....................................  No change.
----------------------------------------------------------------------------------------------------------------

1. Shipments
    Equipment shipments are an important component of any estimate of 
the future impact of a standard. Using a three-step process, DOE 
developed the shipments portion of the NIA spreadsheet, a model that 
uses historical data as a basis for projecting future fixture 
shipments. First, DOE used U.S. Census Bureau fixture shipment data, 
NEMA lamp shipment data, and NEMA ballast sales trends to estimate 
historical shipments of each fixture type analyzed. Second, DOE 
estimated an installed stock for each fixture in 2017 based on the 
average service lifetime of each fixture type. Third, DOE developed 
annual shipment projections for 2017-2046 by modeling fixture 
purchasing events, such as replacement and new construction, and 
applying growth rate, replacement rate, and alternative technologies 
penetration rate assumptions. For details on the shipments analysis, 
see chapter 10 of the final rule TSD.

                          Table V.9--Approach and Data Used for the Shipments Analysis
----------------------------------------------------------------------------------------------------------------
               Inputs                            Proposed rule                   Changes for the final rule
----------------------------------------------------------------------------------------------------------------
Historical Shipments...............  Used historical HID fixture and lamp   Revised historical MH fixture
                                      shipments to develop shipments for     shipments based on updated NEMA MH
                                      MH fixtures.                           ballast shipment trends.
Fixture Stock......................  Based projections on the shipments     No change.
                                      that survive up to a given date;
                                      assumed Weibull lifetime
                                      distribution.
Growth.............................  Adjusted based on fixture market.....  No change.
Base Case Scenarios................  Developed ``low'' and ``high''         Revised ``low'' and ``high''
                                      shipments scenarios.                   shipments scenarios based on
                                                                             revised historical MH fixture
                                                                             shipments.
Standards Case Scenarios...........  Analyzed Roll-up only................  No change.
----------------------------------------------------------------------------------------------------------------

a. Historical Shipments
    For the August 2013 NOPR, DOE reviewed U.S. Census Bureau data from 
1993 to 2001 for metal halide lamp fixtures.\43\ DOE compared the MHLF 
census data to NEMA data for historical metal halide lamp shipments 
from 1990 to 2008 taken from DOE's final determination for HID lamps 
published on July 1, 2010. 75 FR 37975. DOE found a correlation between 
metal halide lamp fixture and metal halide lamp shipments. From 1993 to 
2001, the number of MHLF shipments on average represented 37 percent of 
the amount of lamp shipments, with a standard deviation of 3 percent. 
Using this relationship, DOE multiplied all of the metal halide lamp 
shipments from 1990 to 2010 by 37 percent to estimate the historical 
shipments of metal halide lamp fixtures. DOE assumed that shipments for 
metal halide lamp fixtures would peak somewhere between 2010 and 2015, 
and generally decline thereafter. 78 FR 51464, 51506 (Aug. 20, 2013).
---------------------------------------------------------------------------

    \43\ U.S. Census Bureau. Manufacturing, Mining, and Construction 
Statistics. Current Industrial Reports, Fluorescent Lamp Ballasts, 
MQ335C. 2008. (Last accessed October 28, 2013). www.census.gov/mcd/.
---------------------------------------------------------------------------

    DOE received multiple comments indicating that its shipments 
analysis significantly underestimated the rate of decline in the MHLF 
market, and thereby overestimated total MHLF shipments. (APPA, No. 51 
at p. 2; NEMA, No. 56 at pp. 2, 4, 22; ULT, No. 50 at p. 15) NEMA 
presented new MH ballast sales trend graphs at the NOPR public meeting, 
suggesting a much

[[Page 7789]]

steeper decline in fixture shipments from 2008 to 2013 than assumed in 
the August 2013 NOPR. (NEMA, No. 44 at p. 15) For this final rule, DOE 
retained its peak in fixture shipments, and revised its trend for 
subsequent historical shipments to approximate the new sales trend 
information provided by NEMA. As a result, total estimated MHLF 
shipments for 2013 were approximately 31 percent lower than in the 
August 2013 NOPR. By extension, DOE also revised its projected base 
case shipments downward, as discussed in section V.G.1.c of this final 
rule.
b. Fixture Stock Projections
    In the August 2013 NOPR shipments analysis, DOE calculated the 
installed fixture stock using estimated historical fixture shipments 
and its projected shipments for future years. DOE estimated the 
installed stock during the analysis period by using fixture shipments 
and calculating how many will survive up to a given year based on a 
Weibull lifetime distribution for each fixture type. 78 FR 51464, 51506 
(Aug. 20, 2013). DOE received no comments on the August 2013 NOPR 
regarding its fixture stock projection method and retained this 
approach for this final rule.
c. Base Case Shipment Scenarios
    For the August 2013 NOPR, DOE assumed that shipments for MHLFs 
peaked somewhere between 2010 and 2015. For projected fixture shipments 
in the ``low'' and ``high'' shipment scenarios, DOE projected a decline 
that fell back to the levels in 2000 and 2006, respectively.\44\ 78 FR 
51464, 51506 (Aug. 20, 2013). As discussed previously, several 
commenters stated that DOE overestimated total MHLF shipments in its 
NOPR analysis. (APPA, No. 51 at p. 2; NEMA, No. 56 at pp. 2, 4, 22; 
ULT, No. 50 at p. 15) For this final rule, DOE used new MH ballast 
sales trend information provided by NEMA to revise its historical 
fixture shipments, resulting in significantly lower shipment estimates 
for 2008 to 2013. As a result, DOE's projected fixture shipments 
through 2047 were also significantly lower; for example, the ``low'' 
scenario shipments for 2020 were 31 percent lower than the 
corresponding NOPR estimate and declined to approximately pre-1990 
levels by the end of the shipments analysis period.
---------------------------------------------------------------------------

    \44\ The August 2013 NOPR text at 78 FR 51463, 51506 (August 20, 
2013) incorrectly indicated that fixture shipments in the ``high'' 
scenario in 2040 roughly equaled the shipments in 2006. Several 
commenters stated that the declining MHLF market would not return to 
2006 shipment levels. (APPA, No. 51 at p. 2; NEMA, No. 56 at p. 4) 
DOE's actual modeled fixture shipments for 2040 were roughly equal 
to pre-2000 shipments, significantly lower than the 2006 peak.
---------------------------------------------------------------------------

d. Standards-Case Efficiency Scenarios
    Several of the inputs for determining NES (e.g., the annual energy 
consumption per unit) and NPV (e.g., the total annual installed cost 
and the total annual operating cost savings) depend on equipment 
efficiency. For the August 2013 NOPR, DOE used a ``Roll-up'' shipment 
efficiency scenario, which is a standards case in which all equipment 
efficiencies in the base case that do not meet the standard would 
``roll up'' to the lowest level that can meet the new standard level. 
Equipment efficiencies in the base case above the standard level are 
unaffected in the Roll-up scenario, as these customers are assumed to 
continue to purchase the same base-case fixtures. The Roll-up scenario 
characterizes customers primarily driven by the first cost of the 
analyzed equipment, which DOE believes more accurately characterizes 
the metal halide lamp fixture marketplace. 78 FR 51464, 51506 (Aug. 20, 
2013).
    NEMA and ULT commented on the August 2013 NOPR, stating that 
setting a standard for 150 W fixtures that requires electronic ballasts 
will steer customers to higher wattage, magnetically ballasted 
fixtures. (NEMA, Public Meeting Transcript, No. 48 at pp. 33-34; NEMA, 
No. 44 at p. 9; NEMA, No. 56 at p. 24; ULT, Public Meeting Transcript, 
No. 48 at pp. 144-145; ULT, No. 50 at p. 2)
    DOE agrees that there is some possibility of a shift between the 
technologies. The ballast types play a role in the decision, but so do 
initial costs, life-cycle costs, and utility features of the light 
source. DOE assume that customer would not opt for the 175 W 
magnetically ballasted fixture if the 150 W light fixture is cheaper. 
DOE's analysis has the 175 W metal halide lamp fixture at the baseline 
and efficiency levels 1-3 to be greater than the 150 W metal halide 
lamp fixture at the baseline and efficiency levels 1-3. Therefore, DOE 
assumes that only if a standard that were set requiring efficiency 
level 4 would customers chose to install 175 W metal halide lamp 
fixtures. In this shift scenario, DOE did not assume an overwhelming 
number of customers would shift to 175 W because the economics and 
utility features between the two options were similar. Because the 
options were so similar, there was no an overwhelming reason for 
customers to make large shifts to the 175 W metal halide lamp fixture 
as a result of a standard requiring electronic ballasts for 150 W metal 
halide lamp fixtures.
    Similarly, DOE modeled a shift of customers migrating from 1000 W 
probe-start fixtures to either 875 W pulse-start or 1000 W pulse-start 
fixtures as a result of the design standard being part of this rule. In 
order to examine the market shift that would be expected to occur under 
a design standard for the 500 W-1000 W equipment class, DOE developed 
an econometric-based consumer choice model to estimate the relative 
fraction of 1000 W probe-start fixture customers who migrate to 1000 W 
pulse-start and 875 W pulse-start fixtures. The consumer choice model 
was based on a conditional logit model to establish consumer preference 
between these two options, based on economic parameters, coupled with a 
market diffusion curve to estimate the rapidity of movement in the 
market toward the consumer preference predicted by the logit model. 
Data underlying the consumer choice model reflected that for commercial 
and industrial lighting purchasers as presented in DOE's General 
Service Fluorescent Lamps preliminary analysis technical support 
document.\45\ DOE estimated that approximately 27 percent of those 
customers using 1000 W probe-start fixtures in the base case shipment 
forecast would shift to 875 W pulse-start fixtures and the remaining 73 
percent of 1000 W probe-start customers would migrate to 1000 W pulse-
start fixtures. These market shifts were used in the shipments 
estimates underlying the calculation of the design standard benefits in 
the NIA.
---------------------------------------------------------------------------

    \45\ U.S. Department of Energy--Office of Energy Efficiency and 
Renewable Energy. Energy Conservation Program for Consumer Products: 
Preliminary Technical Support Document: Energy Efficiency Standards 
for Consumer Products: General Service Fluorescent Lamps and 
Incandescent Reflector Lamps. February 2013. Washington, DC. http://www.regulations.gov/#!documentDetail;D=EERE-2011-BT-STD-0006-0022.
---------------------------------------------------------------------------

    DOE also received comments on the August 2013 NOPR stating that 
additional costs resulting from potential standards could increase the 
rate at which MHLF customers migrate to other lighting technologies. 
(APPA, No. 51 at pp. 2-3; NEMA, No. 56 at p. 23; ULT, No. 50 at p. 15) 
NEMA noted that costs for many fixture types had already increased to 
meet recent new National Electrical Code requirements. (NEMA, No. 56 at 
p. 23) NEMA and ULT observed that applications requiring high lumen 
output and high-temperature operating environments still favor metal 
halide lamp fixtures, however. (NEMA, No. 56 at p. 22; ULT, No. 50 at 
p. 15) DOE believes that its

[[Page 7790]]

revised base case shipments (that incorporate new NEMA sales trend 
information) capture the main effect of migration to other lighting 
technologies, and illustrate a significant decrease in total MHLF 
shipments compared to the NOPR analysis. DOE reserved the standards-
case shipments scenario to characterize the purchasing behaviors of 
remaining MHLF customers, and retained its Roll-up approach for this 
final rule.
2. Site-to-Source Energy Conversion
    To estimate the national energy savings expected from appliance 
standards, DOE uses a multiplicative factor to convert site energy 
consumption into primary or source energy consumption (the energy 
required to convert and deliver the site energy). These conversion 
factors account for the energy used at power plants to generate 
electricity and losses in transmission and distribution, as well as for 
natural gas losses from pipeline leakage and energy used for pumping. 
For electricity, the conversion factors vary over time due to projected 
changes in generation sources (i.e., the types of power plants 
projected to provide electricity to the country). The factors that DOE 
developed are marginal values, which represent the response of the 
system to an incremental decrease in consumption associated with 
appliance standards.
    For the August 2013 NOPR, DOE used the annually variable site-to-
source conversion factors based on the version of NEMS that corresponds 
to AEO2013, which provided energy forecasts through 2035. For 2036-
2044, DOE used conversion factors that remain constant at the 2035 
values. 78 FR 51464, 51506 (Aug. 20, 2013). DOE received no comments 
regarding site-to-source conversion factors, and retained its approach 
for today's final rule.
    DOE has historically presented NES in terms of primary energy 
savings. In response to the recommendations of a committee on ``Point-
of-Use and Full-Fuel-Cycle Measurement Approaches to Energy Efficiency 
Standards'' appointed by the National Academy of Science, DOE announced 
its intention to use FFC measures of energy use and greenhouse gas and 
other emissions in the national impact analyses and emissions analyses 
included in future energy conservation standards rulemakings. 76 FR 
51281 (August 18, 2011) While DOE stated in that notice that it 
intended to use the Greenhouse Gases, Regulated Emissions, and Energy 
Use in Transportation (GREET) model to conduct the analysis, it also 
said it would review alternative methods, including the use of NEMS. 
After evaluating both models and the approaches discussed in the August 
18, 2011 notice, DOE published a statement of amended policy in the 
Federal Register in which DOE explained its determination that NEMS is 
a more appropriate tool for its FFC analysis and its intention to use 
NEMS for that purpose. 77 FR 49701 (August 17, 2012). DOE received one 
comment, which was supportive of the use of NEMS for DOE's FFC 
analysis.\46\
---------------------------------------------------------------------------

    \46\ Docket ID: EERE-2010-BT-NOA-0028, comment by Kirk 
Lundblade.
---------------------------------------------------------------------------

    The approach used for today's final rule, and the FFC multipliers 
that were applied, are described in appendix 11B of the final rule TSD. 
NES results are presented in both primary and FFC savings in section 
VII.B.3.a.

H. Customer Subgroup Analysis

    The life-cycle cost subgroup analysis evaluates impacts of 
standards on identifiable groups, such as different customer 
populations or business types that may be disproportionately affected 
by any national energy conservation standard level. For the August 2013 
NOPR, DOE estimated LCC savings and payback periods for three 
subgroups: Utilities, transportation facility owners, and warehouse 
owners. These three subgroups were distinguished from average MHLF 
customers by higher maintenance costs (utilities), higher operating 
hours (transportation facility owners), and lower operating hours 
(warehouse owners). 78 FR 51464, 51507 (Aug. 20, 2013).
    Several utilities commented that DOE incorrectly assigned the same 
retail electricity rates to all three subgroups, when utilities would 
instead pay lower wholesale rates, resulting in lower energy cost 
savings and longer payback periods. (APPA, No. 51 at pp. 8-9; EEI, No. 
53 at p. 4; NRECA, No. 61 at p. 2) DOE agrees with this distinction, 
and DOE referenced EIA wholesale electricity prices \47\ for the 
utility subgroup in its final rule analysis. As discussed previously in 
section V.F.6 of this final rule, DOE is also evaluating two new 
customer subgroups for transient-prone fixtures in outdoor and heavy 
industrial indoor applications. DOE assumed that owners of transient-
prone outdoor fixtures would face shortened surge protection and 
electronic ballast lifetimes because of lightning-induced voltage 
transients, resulting in a 15 percent shorter electronic ballast life 
requiring more frequent electronic ballast and surge protection device 
replacements during the fixture lifetime. For indoor fixtures, DOE 
assumed that fixture owners in heavy industrial environments would face 
shortened surge protection and electronic ballast lifetimes because of 
voltage transients, resulting in a 20% shorter electronic ballast life 
requiring more frequent electronic ballast and surge protection device 
replacements during the fixture lifetime.
---------------------------------------------------------------------------

    \47\ See www.eia.gov/electricity/wholesale/ (Last accessed 
December 2013).
---------------------------------------------------------------------------

    For more information regarding the customer subgroup analysis, see 
chapter 12 of the final rule TSD.

I. Manufacturer Impact Analysis

    DOE conducted an MIA to estimate the financial impact of new and 
amended energy conservation standards on manufacturers of MHLFs and 
ballasts, and to estimate the impact of new and amended standards on 
employment and manufacturing capacity. The quantitative aspect of the 
MIA relies on the GRIM, an industry cash-flow model customized for 
MHLFs and ballasts covered in this rulemaking. The GRIM is used to 
calculate INPV, which is the key MIA output. In its analysis, DOE used 
the GRIM to calculate cash flows using standard accounting principles 
and to compare the difference in INPV between the base case and various 
TSLs (the standards cases). The difference in INPV between the base and 
standards cases represents the financial impact of new and amended MHLF 
standards on MHLF and ballast manufacturers. DOE employed different 
assumptions about markups and future shipments to produce ranges of 
results that represent the uncertainty about how the MHLF and ballast 
industries will respond to energy conservation standards.
    In the MIA, DOE typically groups its estimates of manufacturer 
impacts by the major equipment types that are produced by the same 
manufacturers. The covered equipment in today's rulemaking is MHLFs; 
however, by requiring particular MH ballast efficiencies in this 
regulation, MH ballast manufacturers will also be affected by new and 
amended MHLF standards. The MHLF and ballast markets are served by 
separate groups of manufacturers. DOE therefore presents impacts on 
MHLF manufacturers and MH ballast manufacturers separately.
    DOE outlined its complete methodology for the MIA in the previously 
published NOPR. The complete MIA is presented in chapter 13 of this 
final rule TSD.
1. Manufacturer Production Costs
    Manufacturing higher-efficiency equipment is typically more 
expensive than manufacturing baseline equipment

[[Page 7791]]

due to the need for more costly components. The resulting changes in 
the MPCs of the analyzed equipment can affect the revenues, gross 
margins, and cash flows of manufacturers. DOE strives to accurately 
model the potential changes in these equipment costs, as they are a key 
input for the GRIM and DOE's overall analysis. For the final rule, DOE 
updated the MHLF and some ballast MPCs based on stakeholder comments. 
For a complete description of the changes made to the MPCs see section 
V.C.12 of this final rule.
2. Shipment Projections
    Changes in sales volumes and efficiency distribution of equipment 
over time can significantly affect manufacturer finances. The GRIM 
estimates manufacturer revenues based on total unit shipment 
projections and the distribution of shipments by efficiency level. For 
the final rule, DOE reduced the number of shipments of MHLFs in both 
the low- and high-shipment scenarios based on stakeholder comments. For 
the MIA, the GRIM uses the NIA's annual shipment projections from the 
base year, 2014, to 2046, which is the end of the analysis period. For 
a complete description of the changes made to the shipment analysis see 
section V.G.1 of this final rule.
3. Markup Scenarios
    For the MIA, DOE modeled two standards case markup scenarios to 
represent the uncertainty regarding the potential impacts on prices and 
profitability for manufacturers following the implementation of new and 
amended energy conservation standards: (1) A flat, or preservation of 
gross margin, markup scenario and (2) a preservation of operating 
profit markup scenario. These scenarios lead to different markup 
values, which when applied to the inputted MPCs, result in varying 
revenue and cash-flow impacts.
    For the final rule, DOE did not alter the markup scenarios, values, 
or methodology used in the NOPR analysis.
4. Production and Capital Conversion Costs
    New and amended energy conservation standards will cause 
manufacturers to incur one-time conversion costs to bring their 
production facilities and equipment designs into compliance. For the 
MIA, DOE classified these one-time conversion costs into two major 
groups: (1) Product conversion costs and (2) capital conversion costs. 
Product conversion costs are one-time investments in research, 
development, testing, marketing, and other non-capitalized costs 
necessary to make equipment designs comply with the new and amended 
standards. Capital conversion costs are one-time investments in 
property, plant, and equipment necessary to adapt or change existing 
production facilities such that new equipment designs can be fabricated 
and assembled. DOE created separate conversion costs for MHLF and 
ballast manufacturers.
    In response to the NOPR, Acuity stated they believed the conversion 
costs for fixture manufacturers seemed surprisingly low. (Acuity, 
Public Meeting Transcript, No. 48 at p. 285) DOE assumed that there 
would not be any capital conversion costs for fixture manufacturers at 
efficiency levels requiring more efficient magnetic ballasts. This is 
based on DOE's assumption in the engineering analysis that the size of 
the magnetic ballast would not need to be increased at those efficiency 
levels and therefore, fixture manufacturers would not need to redesign 
their MHLFs to be compatible with the higher efficiency magnetic 
ballasts. Fixture manufacturers would, however, incur product 
conversion costs at efficiency levels requiring magnetic ballasts. 
Higher ballast efficiency levels would require fixture manufacturers to 
re-test and re-certify fixtures with ballasts that were redesigned to 
meet standards. DOE believes that there would be both product 
conversion costs, as well as capital conversion costs, for fixture 
manufacturers at all efficiency levels requiring electronic ballasts 
since fixture manufacturers producing MHLFs containing magnetic 
ballasts would need to redesign their fixture production process.
    Several manufacturers stated there would be significant conversion 
costs to comply with the MHLF standards proposed in the NOPR. Cooper, 
for example stated that they would have to make substantial investments 
to comply with the standards proposed in the NOPR. (Cooper, Public 
Meeting Transcript, No. 48 at p. 58) ULT expressed concern that 
complying with the proposed standards would consume significant company 
time and resources. They commented that from a design cycle standpoint, 
one fixture could take eight to 12 months to redesign and test, which 
includes design validation testing, UL testing, and life-cycle testing. 
(ULT, Public Meeting Transcript, No. 48 at p. 201) DOE acknowledges 
that manufacturers would have to make investments to comply with MHLF 
standards. As part of the MIA, DOE attempts to quantify the time and 
monetary expenditures that would comprise the capital and product 
conversion costs, which MHLF and ballast manufacturers would need to 
incur to convert all their equipment to meet the standards. These 
conversion cost estimates were based on DOE's research and modified 
based on manufacturer feedback during interviews.
    DOE modified the capital conversion costs for the final rule based 
on the reduction in shipments modeled in the final rule shipments 
analysis. Consequently, DOE reduced the capital conversion costs 
proportionally to the reduction in shipments of the final rule, since 
capital conversion costs are correlated to the shipment volume in the 
year standards require compliance. DOE did not alter the product 
conversion costs since these costs are correlated with the number of 
product designs impacted by standards, not necessarily the shipment 
volume in the year standards require compliance.
5. Other Comments From Interested Parties
    During the NOPR public meeting and comment period, interested 
parties commented on the assumptions, methodology, and results of the 
NOPR MIA. DOE received comments about the compliance period, 
alternative technologies, the opportunity cost of investments, the 
replacement ballast market, and potential impact on MH lamp 
manufacturers. These comments are addressed below.
a. Compliance Period
    NEMA stated that based on its analysis, a three-year compliance 
period would be inadequate for the extensive R&D effort that MHLF and 
ballast manufacturers would have to undergo in order to redesign all 
equipment to be compliant with the efficiency levels proposed in the 
NOPR. NEMA stated that in their analysis, they found that manufacturers 
would face significant technical obstacles when trying to produce high 
volumes of compliant MHLFs and ballasts due to the challenging nature 
of processing higher-grade materials, such as M6 steel. NEMA does not 
believe that lighting manufacturers are willing to dedicate enough 
resources to MHLF and ballast technology to be able to redesign all 
wattages during a three-year time period. (NEMA, No. 56 at p. 3) While 
DOE acknowledges there are difficulties and costs associated with 
manufacturing higher efficiency products, all efficiency levels 
analyzed in DOE's engineering analysis, including max tech, are

[[Page 7792]]

technologically feasible to manufacture. For a complete description of 
MHLFs and ballasts and analyzed in the engineering analysis see section 
V.C of this final rule.
    NEMA also commented that the MHLF NOPR proposed expanding the scope 
of covered equipment to include wattage ranges previously not covered 
by the standards prescribed in EISA 2007, as well as eliminating 
exemptions for certain equipment that were granted by EISA 2007. 
According to NEMA, the number of MHLFs impacted would be significant 
and bringing them into compliance would be time-consuming and costly. 
NEMA listed some of the most significant compliance obstacles that 
manufacturers would face including: Evaluating ballast performance to 
identify compliant ballasts; determining if ballasts in fixtures need 
to be replaced; modifying order and quotation systems; obtaining the 
test data for CCE; educating manufacturing staff; educating customers; 
and managing order backlogs. NEMA believes that managing these 
logistics would divert limited resources within lighting divisions and 
would prevent manufacturers from focusing on developing and selling 
more efficient lighting technology, such as LEDs. According to NEMA, 
the proposed standards would delay the market transition to 
technologies that are more efficient than those established by this 
rulemaking. (NEMA, No. 56 at p. 20)
    During the NOPR public meeting, NEMA further emphasized the complex 
logistics manufacturers would face in complying with new and amended 
energy conservation standards. NEMA stated that a large amount of 
equipment would have to be redesigned and several sales channels would 
be impacted if DOE expanded the scope of covered MHLFs beyond what was 
included in EISA 2007. (NEMA, Public Meeting Transcript, No. 48 at pp. 
19-20) According to NEMA, manufacturers would have to employ 
significant company resources to educate internal staff, such as 
marketing and sales representatives, about new equipment available for 
purchase. Time and money would also have to be spent updating IT 
systems due to changes in order processing and inventory management 
software. (NEMA, Public Meeting Transcript, No. 48 at p. 22)
    NEMA further argued that manufacturers would have to use company 
resources to educate their customers about redesigned compliant 
equipment. For fixture manufacturers, customers include OEMs, 
distributors, contractors, designers, home centers, and showrooms. 
Manufacturers would have to modify marketing materials and manage 
orders and contracts which might extend one to two years into the 
future. According to NEMA, managing these contracts would be 
complicated, as the prices and performances of the MHLFs are generally 
guaranteed and would change due to standards. (NEMA, Public Meeting 
Transcript, No. 48 at p. 26) Ballast manufacturers also often have one 
or two-year contracts with their customers, who agree to buy ballasts 
that achieve particular performance levels for an agreed upon price. 
Ballast manufacturers would have to renegotiate these contracts, which 
would be difficult because prices and ballast performances would change 
due to standards. (NEMA, Public Meeting Transcript, No. 48 at p. 23)
    NEMA also stated that fixture manufacturers would not be able to 
start preparing for energy conservation standards until ballast 
manufacturers had completed their redesign and compliance efforts. 
Fixture manufacturers would have to assess whether redesigned ballasts 
were the same form and size and whether they had the same thermal 
characteristics before they would be able to begin redesigning 
fixtures. According to NEMA, if a particular ballast needed to be 
redesigned, that could mean dozens, if not hundreds, of unique fixtures 
using that particular ballast would also need to be redesigned. NEMA 
stated any change in a ballast's form or thermal characteristics would 
require a tremendous redesign effort for fixture manufacturers. (NEMA, 
Public Meeting Transcript, No. 48 at p. 25)
    NEMA further commented that MHLFs and ballasts would also have to 
go through electrical, safety, thermal, and photometric testing, all of 
which would consume manufacturers' time and resources. NEMA expressed 
concern that testing of the new and modified ballasts and fixtures 
would take a significant amount of time and would further complicate 
manufacturers' efforts to abide by the three-year compliance period. 
NEMA pointed out that when the DOE CCE rule went into effect, 
manufacturers took six months to obtain accurate samples for 
certification. Manufacturers would have to redesign and test modified 
ballasts and fixtures before even beginning to collect samples for the 
CCE rule. NEMA argued that this would be difficult to achieve within 
the three-year compliance period. (NEMA, Public Meeting Transcript, No. 
48 at p. 22) NEMA also questioned whether UL could handle the volume of 
testing that would be necessary to comply with standards in such a 
short period of time since all redesigned MHLFs and ballasts would need 
to be certified. (NEMA, Public Meeting Transcript, No. 48 at p. 26)
    DOE acknowledges that new and amended energy conservation standards 
will require MHLF and ballast manufacturers to undergo changes to their 
production processes, modify existing equipment, develop new models, 
and make a series of complex logistical decisions. In the NOPR, DOE 
assumed ballast and fixture manufacturers must comply with standards as 
of January 1, 2015. However, as described in section VI.C, DOE has 
revised the compliance date in the final rule to be consistent with the 
three-year time frame specified in EISA 2007. DOE assumes a three-year 
compliance period when estimating all capital and product conversion 
costs, which DOE included as potential burdens when selecting standards 
for MHLFs.
b. Alternative Technologies
    DOE recognizes that there are alternative lighting technologies 
that can be used in the same applications as MHLFs and that MHLF 
shipments are on the decline. Lighting manufacturers, for example are 
heavily investing in R&D for LEDs, an advanced and highly efficient 
lighting technology for which demand is growing rapidly. LED technology 
has matured to the point that it can be used in a number of 
applications in which MHLFs are typically used, predominantly at lower 
wattages. However at higher wattages, it is more difficult for 
customers to switch from MH to LED.
    At the NOPR public meeting, Philips pointed out that a majority of 
R&D resources within the lighting industry have already been 
transferred to LEDs and away from traditional lighting technologies. 
(Philips, Public Meeting Transcript, No. 48 at p. 50) ULT stated that 
by creating new standards for a technology with declining market share, 
DOE is hindering this trend, as manufacturers will have to divert 
resources away from developing more advanced and efficient technologies 
to convert their metal halide product lines. (ULT, Public Meeting 
Transcript, No. 48 at p. 61) Acuity noted, however, that in the higher-
wattage applications, LED technology has not yet developed a high-
intensity lighting solution, and therefore the market will be forced to 
continue to develop MH lamps for those applications. (Acuity, Public 
Meeting Transcript, No. 48 at p. 24)
    APPA, NRECA, and EEI all noted that due to market conditions and 
the

[[Page 7793]]

existence of other lighting technologies, manufacturers may have no 
incentive to make replacement ballasts for existing MHLFs. (APPA, No. 
51 at p. 7; NRECA, No. 61 at p. 2; EEI, No. 53 at p. 3) APPA pointed 
out that MH ballast production has been declining since 2008 and that 
manufacturers may decide to halt the production of replacement ballasts 
to focus on LEDs. APPA argued that if replacement ballasts became 
commercially unavailable, the original intent of the rule, which was 
not to force the implementation of new fixtures, would be lost. (APPA, 
No. 51 at p. 7) NEEA argued that to avoid this problem, regulations are 
needed for LEDs so that manufacturers would have incentive to perform 
research and development on MHLFs to make them more efficient. (NEEA, 
Public Meeting Transcript, No. 48 at p. 53)
    DOE acknowledges that the MHLF market is currently in decline and 
has modeled this decline into its projections of future MHLF and 
ballast shipments. Any effects of increased R&D of technologies not 
covered by this rulemaking and the market penetration of those 
technologies into the MHLF market are discussed in the following 
section of the MIA (V.I.5.c) DOE agrees that there are a number of 
applications in which LED cannot provide equivalent lumen output to 
MHLF light levels and that there will be a continued market for this 
equipment. DOE expects that even with the standards adopted by this 
final rule there will be a market for manufacturers to make replacement 
ballasts.
c. Opportunity Cost of Investments
    Several manufacturers commented that developing MHLFs to meet 
energy conservation standards would have opportunity costs. NEMA argued 
that diverting resources to convert MHLFs and ballasts to comply with 
new and amended standards would negatively impact the lighting market 
by delaying the introduction of products with potentially higher 
efficiency, better utility, and more responsive controls. (NEMA, No. 56 
at p. 24) Musco Lighting commented that the proposed standard requiring 
pulse-start lamps would divert critical R&D resources to attempt to 
develop a technology that does not exist and to this point has not been 
determined as commercially achievable. Musco Lighting stated R&D 
resources in the lighting industry should remain focused on 
technologies that have significant opportunities for energy reduction, 
such as LEDs. Musco Lighting believes the proposed MHLF standards would 
not achieve significant energy savings and would potentially hold back 
substantial lighting efficiency gains by diverting resources. (Musco 
Lighting, No. 55 at p. 3)
    Most manufacturers agreed that LEDs are the future of the lighting 
industry, and therefore are primarily focusing R&D resources on this 
technology as opposed to MH technology. As a result, NEMA pointed out 
that lighting manufacturers are working with fewer human resources 
dedicated to MH than they were when they first had to come into 
compliance with EISA 2007 MH standards. Meeting those standards was 
very complicated for manufacturers even with the more abundant 
resources that were available. It will be difficult for companies to 
simultaneously develop LEDs and upgrade MHLFs and ballasts (NEMA, 
Public Meeting Transcript, No. 48 at p. 20)
    ULT pointed out that while LEDs are growing in market share, they 
are still not mature enough to work well in all applications; however, 
manufacturers are getting closer to achieving this through R&D. 
According to ULT, lighting manufacturers are working on developing 
fixtures that are designed to remove heat, keep water out, and help 
protect against surges to allow the use of LEDs in all fixtures. ULT 
believes that MHLF standards requiring manufacturers to spend over a 
year designing, testing, and validating MHLFs and ballasts would slow 
the integration of LEDs into the market and force manufacturers to work 
on lighting technologies that may not be in the market in the next five 
to 10 years. (ULT, No. 50 at p. 16-17) NEMA commented that if 
manufacturers chose to convert their MH equipment to the proposed 
efficiency levels, the higher priced MHLFs could cause customers to 
shift to LEDs anyway, which would mean that manufacturers would not 
recoup the cost of investment into MHLFs. (NEMA, Public Meeting 
Transcript, No. 48 at p. 150) Several manufacturers and NEMA said that 
these considerations could cause some fixture and ballast manufacturers 
to exit the MH market. (NEMA, Public Meeting Transcript, No. 48. 283)
    NEMA argued that manufacturers may choose to exit the market due to 
the fact that the proposed standards could have severe impacts on 
manufacturers. They noted that in DOE's NOPR analysis, MH ballast 
manufacturers would need to invest up to 29 million dollars at the 
proposed TSL and this could result in up to a 25 percent loss of base 
case INPV. According to NEMA, the impacts will be more severe than DOE 
projected in the NOPR because NEMA believes that shipments of MHLFs and 
ballasts will decline much faster than DOE projected. NEMA argued that 
the rapidly declining MH market makes it difficult for manufacturers to 
justify the significant investments necessary to comply with MHLF 
standards. (NEMA, No. 56 at p. 23) DOE has adjusted the projected 
volume of shipments based on stakeholder feedback. In the final rule 
shipment analysis, there is a sharper decline in MHLF shipments as 
suggested by NEMA's comment. For a complete description of the changes 
made to the shipment analysis see section V.G.1 of this final rule.
    DOE recognizes the opportunity cost associated with any investment, 
and agrees that manufacturers would need to spend capital and company 
resources to meet today's standards that they would not have to spend 
in the absence of standards. As a result, manufacturers must determine 
the extent to which they will balance investment in the MH market with 
investment in emerging technologies, such as LEDs. These companies will 
have to weigh tradeoffs between deferring investments and deploying 
additional capital. DOE includes the costs of meeting today's standard 
in the conversion costs portion of the MIA.
d. Replacement Ballast Market
    As noted in the scope of coverage section, this rulemaking covers 
new MHLFs. Even though the metric being regulated is ballast 
efficiency, the standards set in this rulemaking only apply to ballasts 
sold with new fixtures. Ballasts sold separately, to be used as 
replacement ballasts for existing fixtures, are not required to comply 
with these standards.
    There was some concern among stakeholders that manufacturers might 
not choose to manufacture similar wattage ballasts at multiple 
efficiency levels due to lack of economic viability. ULT and Cooper 
both commented that the proposed standard for new MHLFs would affect 
all MH ballasts and not just new MHLFs because it is economically 
infeasible to maintain two different ballast product lines--one that 
services the replacement market that would not be subject to standards 
and another that services the new MHLF market that would be subject to 
standards. (ULT, Public Meeting Transcript, No. 48 at p. 65-66; Cooper, 
Public Meeting Transcript, No. 48 at p. 67) NEEA argued that while this 
was probably true, as long as there is a market for replacement MH 
ballasts, some companies would manufacture those replacement ballasts 
to fulfill that market. According to NEEA, a manufacturer could 
continue their current MH ballast production line

[[Page 7794]]

which would only service the replacement MH ballast market and not 
manufacture ballasts for new MHLFs. (NEEA, Public Meeting Transcript, 
No. 48 at p. 72) ULT responded by commenting that manufacturers are not 
going to want to redesign and manufacture two production lines for MH 
ballasts which would increase their inventory and carrying costs for MH 
ballasts and rather will continue to focus on solid state lighting. ULT 
believes this could open up the replacement ballasts market to offshore 
MH ballast manufacturers and result in an increase in products that 
will have quality and warranty problems, which is bad for end-users. 
(ULT, Public Meeting Transcript, No. 48 at p. 73)
    Also several organizations commented on the impact of MHLF 
standards on the portfolio of ballasts available for the replacement 
market. APPA requested confirmation that the standards proposed in the 
NOPR would not eliminate the production of replacement ballasts for 
existing and future MHLFs. (APPA, No. 51 at p. 1) NEMA, ULT, and APPA 
stated manufacturers could not be expected to maintain product lines 
for both new fixture ballasts and for the replacement or repair of old 
fixtures. Therefore, customers with MHLFs currently installed might be 
left with stranded assets. However, NEMA, ULT, and APPA noted that if 
standards do not force customers to switch to electronic ballasts or 
magnetic ballasts to incur physical changes, the market could continue 
to be adequately serviced by manufacturers. (NEMA, No. 56 at pp. 10, 
24; ULT, No. 50 at pp. 17-18; APPA, No. 51 at p. 8) GE noted that if 
the standard were to require larger ballasts, it would mean having no 
direct replacement for the installed base, especially in a situation 
such as a natural disaster, where the majority of lighting in a 
subdivision would need to be replaced. (GE, Public Meeting Transcript, 
No. 48 at p. 89) Conversely, the Joint Comment stated that there will 
always be a market for these replacement ballasts, regardless of the 
efficiency requirements, and that it would be a business decision 
whether manufacturers would want to fill that niche market. (Joint 
Comment, No. 62 at p. 7)
    DOE's market analysis found that several of the largest 
manufacturers of MH ballasts responded to the standards mandated by 
EISA 2007 for 150 W-500 W ballasts sold with new fixtures by offering 
ballasts with efficiencies that comply with EISA 2007 standard levels, 
and replacement ballasts with efficiencies that do not comply with EISA 
2007, at the same wattages. While DOE predicts a similar response to 
the standards adopted in this final rule, the financial viability of 
offering ballasts that fall above and below these standards will be a 
business decision for each manufacturer. For the MIA, DOE includes the 
costs of upgrading MH ballast production for new MHLFs (and not 
upgrading replacement ballasts) to meet the standards in its analysis 
and any other course of action would be a business decision made by 
manufacturers which is not modeled by DOE.
e. Potential Impact on Metal Halide Lamp Manufacturers
    Philips commented that there could be a negative impact on MH lamp 
manufacturers due to MHLF standards. Philips stated as the cost of 
MHLFs increase due to standards more people are going to purchase LEDs 
and as a result, the volume of MHLFs and MH lamps will decrease. 
Therefore, Philips believes that DOE should take into account costs 
imposed on MH lamp manufacturers associated with MHLF standards. 
(Philips, Public Meeting Transcript, No. 48 at p. 277) DOE recognizes 
that LEDs are continuing to capture more and more of the lighting 
markets serviced by MHLFs and accounts for this shift to LEDs in the 
shipment analysis for this rulemaking. DOE does not believe that MHLF 
standards will hasten this shift to LEDs, as LEDs are not appropriate 
substitutes for all MHLFs given the large lumen output of the higher 
wattage MHLFs. Therefore, this market shift to LEDs is captured in the 
base case shipment scenario and is not modeled as a standards-induced 
market shift.
6. Manufacturer Interviews
    DOE interviewed manufacturers representing more than 65 percent of 
MHLF sales and 90 percent of MH ballast sales. The NOPR interviews were 
in addition to the preliminary interviews DOE conducted as part of the 
interim analysis. DOE outlined the key issues for the rulemaking for 
manufacturers in the NOPR. DOE considered the information received 
during these interviews in the development of the NOPR and this final 
rule. Comments on the NOPR regarding the impact of standards on 
manufacturers were discussed in the preceding sections. DOE did not 
conduct interviews with manufacturers between the publication of the 
NOPR and this final rule.

J. Employment Impact Analysis

    DOE considers employment impacts in the domestic economy as one 
factor in selecting a standard. Employment impacts consist of direct 
and indirect impacts. Direct employment impacts are any changes in the 
number of employees working for manufacturers of the equipment subject 
to standards, their suppliers, and related service firms. The MIA 
addresses those impacts. Indirect employment impacts from standards 
consist of the net jobs created or eliminated in the national economy, 
other than the manufacturing sector being regulated, caused by: (1) 
Reduced spending by end users on energy; (2) reduced spending on new 
energy supplies by the utility industry; (3) increased spending on new 
equipment to which the new standards apply; and (4) the effects of 
those three factors throughout the economy.
    One method for assessing the possible effects of such shifts in 
economic activity on the demand for labor is to compare sector 
employment statistics developed by the Labor Department's Bureau of 
Labor Statistics (BLS).\48\ The BLS regularly publishes its estimates 
of the number of jobs per million dollars of economic activity in 
different sectors of the economy, as well as the jobs created elsewhere 
in the economy by this same economic activity. Data from the BLS 
indicate that expenditures in the utility sector generally create fewer 
jobs (both directly and indirectly) than expenditures in other sectors 
of the economy.\49\ There are many reasons for these differences, 
including wage differences and the fact that the utility sector is more 
capital-intensive and less labor-intensive than other sectors. Energy 
conservation standards have the effect of reducing customer utility 
bills. Because reduced customer expenditures for energy likely lead to 
increased expenditures in other sectors of the economy, the general 
effect of efficiency standards is to shift economic activity from a 
less labor-intensive sector (i.e., the utility sector) to more labor-
intensive sectors (e.g., the retail and manufacturing sectors). Thus, 
based on the BLS data alone, DOE believes that net national employment 
will increase

[[Page 7795]]

due to shifts in economic activity resulting from new and amended 
standards for metal halide lamp fixtures.
---------------------------------------------------------------------------

    \48\ Data on industry employment, hours, labor compensation, 
value of production, and the implicit price deflator for output for 
these industries are available upon request by calling the Division 
of Industry Productivity Studies (202-691-5618) or by sending a 
request by email todipsweb@bls.gov. Available at: www.bls.gov/news.release/prin1.nr0.htm. (Last accessed October 2013.)
    \49\ See Bureau of Economic Analysis, Regional Multipliers: A 
User Handbook for the Regional Input-Output Modeling System (RIMS 
II), Washington, DC, U.S. Department of Commerce, 1992.
---------------------------------------------------------------------------

    For the standard levels considered in today's final rule, DOE 
estimated indirect national employment impacts using an input/output 
model of the U.S. economy called Impact of Sector Energy Technologies 
(ImSET), version 3.1.1.\50\ ImSET is a special-purpose version of the 
``U.S. Benchmark National Input-Output'' (I-O) model, which was 
designed to estimate the national employment and income effects of 
energy-saving technologies. The ImSET software includes a computer-
based I-O model having structural coefficients that characterize 
economic flows among 187 sectors most relevant to industrial, 
commercial, and residential building energy use.
---------------------------------------------------------------------------

    \50\ Roop, J. M., M. J. Scott, and R. W. Schultz, ImSET 3.1: 
Impact of Sector Energy Technologies (PNNL-18412 Pacific Northwest 
National Laboratory) (2009). Available at www.pnl.gov/main/publications/external/technical_reports/PNNL-18412.pdf. (Last 
accessed October 2013.)
---------------------------------------------------------------------------

    DOE received several general comments at the NOPR public meeting 
questioning the validity of its employment analysis results. (Acuity, 
Public Meeting Transcript, No. 48 at p. 306; EEI, Public Meeting 
Transcript, No. 48 at pp. 298-301; GE, Public Meeting Transcript, No. 
48 at p. 306; NEEA, Public Meeting Transcript, No. 48 at pp. 304-305; 
NEMA, Public Meeting Transcript, No. 48 at p. 302) DOE notes that ImSET 
is not a general equilibrium projection model and understands the 
uncertainties involved in projecting employment impacts, especially 
changes in the later years of the analysis. Because ImSET does not 
incorporate price changes, the employment effects predicted by ImSET 
may overestimate actual job impacts over the long run for this rule. 
Because ImSET predicts small job impacts resulting from this rule, 
regardless of these uncertainties, the actual job impacts are likely to 
be negligible in the overall economy. DOE may consider the use of other 
modeling approaches for examining long-term employment impacts. DOE 
also notes that the indirect employment impacts estimated with ImSET 
for the entire economy differ from the direct employment impacts in the 
lighting manufacturing sector estimated using the GRIM in the MIA, as 
described at the beginning of this section. The methodologies used and 
the sectors analyzed in the ImSET and GRIM models are different.
    For more details on the employment impact analysis, see chapter 14 
of the final rule TSD.

K. Utility Impact Analysis

    The utility impact analysis estimates several important effects on 
the utility industry of the adoption of new or amended standards. For 
this analysis, DOE used the NEMS-BT model to generate forecasts of 
electricity consumption, electricity generation by plant type, and 
electric generating capacity by plant type, that would result from each 
considered TSL. DOE obtained the energy savings inputs associated with 
efficiency improvements to considered equipment from the NIA. DOE 
conducts the utility impact analysis as a scenario that departs from 
the latest AEO Reference Case. For the August 2013 NOPR analysis, the 
estimated impacts of standards were the differences between values 
forecasted by NEMS-BT and the values in the AEO2013 Reference Case. 78 
FR 51464, 51512 (Aug. 20, 2013). DOE received no comments related to 
its utility impact analysis and retained its approach for this final 
rule. Chapter 15 of the final rule TSD describes the utility impact 
analysis.

L. Emissions Analysis

    In the emissions analysis, DOE estimated the reduction in power 
sector emissions of CO2, NOX, SO2, and 
Hg from potential energy conservation standards for metal halide lamp 
fixtures. In addition to estimating impacts of standards on power 
sector emissions, DOE estimated emissions impacts in production 
activities that provide the energy inputs to power plants. These are 
referred to as ``upstream'' emissions. In accordance with the FFC 
Statement of Policy (76 FR 51281 [August 18, 2011]), as amended at 77 
FR 49701 (Aug. 17, 2012), this FFC analysis includes impacts on 
emissions of methane (CH4) and nitrous oxide 
(N2O), both of which are recognized as greenhouse gases.
    DOE primarily conducted the emissions analysis using emissions 
factors for CO2 and most of the other gases derived from 
data in AEO2013. Combustion emissions of CH4 and 
N2O were estimated using emissions intensity factors 
published by the Environmental Protection Agency (EPA), GHG Emissions 
Factors Hub.\51\ Site emissions of CO2 and NOX 
were estimated using emissions intensity factors from an EPA 
publication.\52\ DOE developed separate emissions factors for power 
sector emissions and upstream emissions. The method that DOE used to 
derive emissions factors is described in chapter 16 of the final rule 
TSD.
---------------------------------------------------------------------------

    \51\ See www.epa.gov/climateleadership/guidance/ghg-emissions.html.
    \52\ U.S. Environmental Protection Agency, Compilation of Air 
Pollutant Emission Factors, AP-42, Fifth Edition, Volume I: 
Stationary Point and Area Sources. 1998. www.epa.gov/ttn/chief/ap42/index.html.
---------------------------------------------------------------------------

    For CH4 and N2O, DOE calculated emissions 
reduction in tons and also in terms of units of carbon dioxide 
equivalent (CO2eq). Gases are converted to CO2eq 
by multiplying the physical units by the gas' global warming potential 
(GWP) over a 100-year time horizon. Based on the Fourth Assessment 
Report of the Intergovernmental Panel on Climate Change,\53\ DOE used 
GWP values of 25 for CH4 and 298 for N2O.
---------------------------------------------------------------------------

    \53\ Forster, P., V. Ramaswamy, P. Artaxo, T. Berntsen, R. 
Betts, D.W. Fahey, J. Haywood, J. Lean, D.C. Lowe, G. Myhre, J. 
Nganga, R. Prinn, G. Raga, M. Schulz and R. Van Dorland. 2007: 
Changes in Atmospheric Constituents and in Radiative Forcing. In 
Climate Change 2007: The Physical Science Basis. Contribution of 
Working Group I to the Fourth Assessment Report of the 
Intergovernmental Panel on Climate Change. S. Solomon, D. Qin, M. 
Manning, Z. Chen, M. Marquis, K.B. Averyt, M. Tignor and H.L. 
Miller, Editors. 2007. Cambridge University Press, Cambridge, United 
Kingdom and New York, NY, USA. p. 212.
---------------------------------------------------------------------------

    EIA prepares the Annual Energy Outlook using NEMS. Each annual 
version of NEMS incorporates the projected impacts of existing air 
quality regulations on emissions. AEO2013 generally represents current 
legislation and environmental regulations, including recent government 
actions, for which implementing regulations were available as of 
December 31, 2012.
    SO2 emissions from affected electricity-generating units 
(EGUs) are subject to nationwide and regional emissions cap-and-trade 
programs. 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 (DC). SO2 emissions from 28 eastern 
states and DC were also limited under the Clean Air Interstate Rule 
(CAIR; 70 FR 25162 [May 12, 2005]), which created an allowance-based 
trading program. CAIR was remanded to the EPA by the U.S. Court of 
Appeals for the District of Columbia Circuit, but it remained in 
effect. See North Carolina v. EPA, 550 F.3d 1176 (D.C. Cir. 2008); 
North Carolina v. EPA, 531 F.3d 896 (D.C. Cir. 2008). On July 6, 2011 
EPA issued a replacement for CAIR, the Cross-State Air Pollution Rule 
(CSAPR). 76 FR 48208 (Aug. 8, 2011). On August 21, 2012, the D.C. 
Circuit issued a decision to vacate CSAPR. See EME Homer City 
Generation, LP v. EPA, 696 F.3d 7, 38 (D.C. Cir. 2012). The court 
ordered EPA to continue administering CAIR. The AEO2013 emissions 
factors used for today's NOPR assume that CAIR remains a binding 
regulation through 2040.

[[Page 7796]]

    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. 
In past rulemakings, DOE recognized that there was uncertainty about 
the effects of efficiency standards on SO2 emissions covered 
by the existing cap-and-trade system, but it concluded that negligible 
reductions in power sector SO2 emissions would occur as a 
result of standards.
    Beginning in 2015, however, SO2 emissions will fall as a 
result of the Mercury and Air Toxics Standards (MATS) for power plants. 
77 FR 9304 (Feb. 16, 2012). In the final MATS rule, EPA established a 
standard for hydrogen chloride as a surrogate for acid gas hazardous 
air pollutants (HAP), and also established a standard for 
SO2 (a non-HAP acid gas) as an alternative equivalent 
surrogate standard for acid gas HAP. The same controls are used to 
reduce HAP and non-HAP acid gas; thus, SO2 emissions will be 
reduced as a result of the control technologies installed on coal-fired 
power plants to comply with the MATS requirements for acid gas. AEO2013 
assumes that, in order to continue operating, coal plants must have 
either flue gas desulfurization or dry sorbent injection systems 
installed by 2015. Both technologies, which are used to reduce acid gas 
emissions, also reduce SO2 emissions. Under the MATS, NEMS 
shows a reduction in SO2 emissions when electricity demand 
decreases (e.g., as a result of energy efficiency standards). Emissions 
will be far below the cap that would be established by CAIR, so it is 
unlikely that excess SO2 emissions allowances resulting from 
the lower electricity demand would be needed or used to permit 
offsetting increases in SO2 emissions by any regulated EGU. 
Therefore, DOE believes that efficiency standards will reduce 
SO2 emissions in 2015 and beyond.
    CAIR established a cap on NOX emissions in 28 eastern 
states and the District of Columbia. Energy conservation standards are 
expected to have little effect on NOX emissions in those 
states covered by CAIR because excess NOX emissions 
allowances resulting from the lower electricity demand could be used to 
permit offsetting increases in NOX emissions. However, 
standards would be expected to reduce NOX emissions in the 
states not affected by the caps, so DOE estimated NOX 
emissions reductions from the standards considered in today's final 
rule for these states.
    The MATS limit mercury emissions from power plants, but they do not 
include emissions caps and, as such, DOE's energy conservation 
standards would likely reduce Hg emissions. DOE estimated mercury 
emissions reduction using NEMS-BT based on AEO2013, which incorporates 
the MATS.
    DOE received comments regarding the emissions analysis during the 
NOPR public meeting. EEI noted that the EPA recently proposed 
greenhouse gas emissions standards for new EGUs \54\ and would issue 
standards for existing EGUs in 2014. EEI commented that these standards 
would have a significant effect on DOE's emission analysis and that 
they should be considered in the final rule. (EEI, Public Meeting 
Transcript, No. 48 at pp. 307-309) In a joint comment, the U.S. Chamber 
of Commerce and cosignatories \55\ (hereafter the ``U.S. Chamber et 
al.'') agreed. (U.S. Chamber et al., No. 58 at p. 7) As discussed 
previously in this section, the AEO2013 emissions factors available for 
this final rule analysis reflect regulations implemented as of December 
31, 2012, and DOE cannot consider proposed emission standards in 
setting potential equipment efficiency standards.\56\ GE encouraged DOE 
to consider the additional emissions produced in manufacturing the 
larger fixtures needed to meet potential efficiency standards, and GE 
indicated that NEMA intended to evaluate the ``carbon footprint'' of 
its manufacturing processes. (GE, Public Meeting Transcript, No. 48 at 
pp. 311-312) DOE received no related emissions estimates in written 
comments; further, as discussed previously in section V.C of this final 
rule, DOE's engineering analysis indicated that higher efficiency 
fixtures would not be significantly larger than baseline fixtures. DOE 
believes that any incremental emissions increases from the manufacture 
of higher efficiency fixtures would be negligible in comparison to its 
overall emissions estimates, and DOE retained its AEO-based approach 
for this final rule emissions analysis.
---------------------------------------------------------------------------

    \54\ Standards of Performance for Greenhouse Gas Emissions from 
New Stationary Sources: Electric Utility Generating Units--Proposed 
Rule (September 20, 2013); pre-publication version at www2.epa.gov/sites/production/files/2013-09/documents/20130920proposal.pdf (Last 
accessed November 22, 2013).
    \55\ Cosignatories include the American Forest & Paper 
Association, American Fuel & Petrochemical Manufacturers, American 
Petroleum Institute, Council of Industrial Boiler Owners, National 
Association of Manufacturers, National Mining Association, and the 
Portland Cement Association.
    \56\ APPA commented that EPA new source performance standards 
are effective upon issuance of the proposed rule. (APPA, Public 
Meeting Transcript, No. 48 at p. 310) DOE disagrees, citing section 
III.B of the proposed rule that states the emission limit would 
apply to affected sources on the effective date of the final action.
---------------------------------------------------------------------------

M. Monetizing Carbon Dioxide and Other Emissions Impacts

    As part of the development of this final rule, DOE considered 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 customer benefit, DOE considered the 
reduced emissions expected to result over the lifetime of equipment 
shipped in the projection period for each TSL. This section summarizes 
the basis for the monetary values used for each of these emissions and 
presents the values considered in this rulemaking.
    For today's final rule, DOE is relying on a set of values for the 
SCC that was developed by an interagency process. A summary of the 
basis for these values is provided in the following section, and a more 
detailed description of the methodologies used is provided as an 
appendix to chapter 17 of the final rule TSD.
1. Social Cost of Carbon
    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 CO2. A domestic SCC value is 
meant to reflect the value of damages in the United States resulting 
from a unit change in CO2 emissions, while a global SCC 
value is meant to reflect the value of damages worldwide.
    Under section 1(b) of E.O. 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.

[[Page 7797]]

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.
a. Monetizing Carbon Dioxide Emissions
    When attempting to assess the incremental economic impacts of 
CO2 emissions, the analyst faces a number of serious 
challenges. A recent report from the National Research Council \57\ 
points out that any assessment will suffer from uncertainty, 
speculation, and lack of information about (1) future emissions of 
GHGs, (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.
---------------------------------------------------------------------------

    \57\ National Research Council. Hidden Costs of Energy: Unpriced 
Consequences of Energy Production and Use. National Academies Press: 
Washington, DC (2009).
---------------------------------------------------------------------------

    Despite the serious limits of both quantification and monetization, 
SCC estimates can be useful in estimating the social benefits of 
reducing CO2 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 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 
CO2 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 to this notice, 
however.
    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. In the meantime, the interagency group will continue to 
explore the issues raised by this analysis and consider public comments 
as part of the ongoing interagency process.
b. Social Cost of Carbon Values Used in Past Regulatory Analyses
    Economic analyses for Federal regulations used a wide range of 
values to estimate the benefits associated with reducing CO2 
emissions. The model year 2011 Corporate Average Fuel Economy final 
rule used both a ``domestic'' SCC value of $2 per metric ton of 
CO2 and a ``global'' SCC value of $33 per metric ton of 
CO2 for 2007 emission reductions (in 2007$), increasing both 
values at 2.4 percent per year. It also included a sensitivity analysis 
at $80 per metric ton of CO2.\58\ The proposed rule for 
Model Years 2011-2015 assumed a domestic SCC value of $7 per metric ton 
of CO2 (in 2006$) for 2011 emission reductions (with a range 
of $0-$14 for sensitivity analysis), also increasing at 2.4 percent per 
year.\59\ A regulation for packaged terminal air conditioners and 
packaged terminal heat pumps finalized by DOE in 2008 used a domestic 
SCC range of $0 to $20 per metric ton CO2 for 2007 emission 
reductions (in 2007$). 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 $40 per 
metric ton CO2 for discount rates of approximately 2 percent 
and 3 percent, respectively (in 2006$ for 2007 emissions).
---------------------------------------------------------------------------

    \58\ 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: www.nhtsa.gov/fuel-economy).
    \59\ 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: 
www.nhtsa.gov/fuel-economy).
---------------------------------------------------------------------------

    In 2009, an interagency process was initiated to offer a 
preliminary assessment of how best to quantify the benefits from 
reducing CO2 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 proposed 
and final rules.
c. 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. The 
group considered public comments and further explored the technical 
literature in relevant fields. The interagency group relied on three 
integrated assessment models 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, socioeconomic and

[[Page 7798]]

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 socioeconomic 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 sets of SCC values for use in 
regulatory analyses. Three values were 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, were 
included to represent higher-than-expected impacts from temperature 
change further out in the tails of the SCC distribution. The values 
estimated for 2010 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, although preference is given to consideration of the 
global benefits of reducing CO2 emissions. Table V.10 
presents the values in the 2010 interagency group report,\60\ which is 
reproduced in appendix 17A of the final rule TSD.
---------------------------------------------------------------------------

    \60\ Social Cost of Carbon for Regulatory Impact Analysis Under 
Executive Order 12866. Interagency Working Group on Social Cost of 
Carbon, United States Government, 2010.

                      Table V.10--Annual SCC Values From 2010 Interagency Report, 2010-2050
                                      [In 2007 dollars per metric ton CO2]
----------------------------------------------------------------------------------------------------------------
                                                                                 Discount rate
                                                             ---------------------------------------------------
                                                                5% Avg.      3% Avg.     2.5% Avg.     3% 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
----------------------------------------------------------------------------------------------------------------

    The SCC values used for today's notice were generated using the 
most recent versions of the three integrated assessment models that 
have been published in the peer-reviewed literature.\61\ Table V.11 
shows the updated sets of SCC estimates in five-year increments from 
2010 to 2050. The full set of annual SCC estimates between 2010 and 
2050 is reported in appendix 17B of the final rule TSD. The central 
value that emerges is the average SCC across models at the 3 percent 
discount rate. However, for purposes of capturing the uncertainties 
involved in regulatory impact analysis, the interagency group 
emphasized the importance of including all four sets of SCC values.
---------------------------------------------------------------------------

    \61\ Technical Support Document: Technical Update of the Social 
Cost of Carbon for Regulatory Impact Analysis Under Executive Order 
12866. Interagency Working Group on Social Cost of Carbon, United 
States Government, May 2013 (Revised November 2013). 
www.whitehouse.gov/sites/default/files/omb/assets/inforeg/technical-update-social-cost-of-carbon-for-regulator-impact-analysis.pdf.

                      Table V.11--Annual SCC Values from 2013 Interagency Update, 2010-2050
                                      [In 2007 dollars per metric ton CO2]
----------------------------------------------------------------------------------------------------------------
                                                                              Discount rate %
                                                          ------------------------------------------------------
                                                                5            3           2.5             3
                           Year                           ------------------------------------------------------
                                                                                                       95th
                                                             Average      Average      Average      percentile
----------------------------------------------------------------------------------------------------------------
2010.....................................................           11           32           51              89
2015.....................................................           11           37           57             109
2020.....................................................           12           43           64             128
2025.....................................................           14           47           69             143
2030.....................................................           16           52           75             159
2035.....................................................           19           56           80             175
2040.....................................................           21           61           86             191
2045.....................................................           24           66           92             206
2050.....................................................           26           71           97             220
----------------------------------------------------------------------------------------------------------------

    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 CO2 emissions and the limits of 
existing efforts to model these effects. There are a number of concerns 
and problems should be addressed by the research community, including 
research programs housed in many of the Federal agencies participating 
in the interagency process

[[Page 7799]]

to estimate the SCC. The interagency group intends 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 summary, in considering the potential global benefits resulting 
from reduced CO2 emissions, DOE used the values from the 
2013 interagency report, adjusted to 2012$ using the Gross Domestic 
Product price deflator. For each of the four cases specified, the 
values used for emissions in 2015 were $11.8, $39.7, $61.2, and $117 
per metric ton avoided (values expressed in 2012$).\62\ DOE derived 
values after 2050 using the growth rate for the 2040-2050 period in the 
interagency update.
---------------------------------------------------------------------------

    \62\ The interagency report presents SCC values through 2050. 
DOE derived values after 2050 using the 3-percent per year 
escalation rate used by the interagency group.
---------------------------------------------------------------------------

    DOE multiplied the CO2 emissions reduction estimated for 
each year by the SCC value for that year in each of the four cases. To 
calculate a present value of the stream of monetary values, DOE 
discounted 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.
    In responding to the MHLF NOPR, many commenters questioned the 
scientific and economic basis of the SCC values. These commenters made 
extensive comments about: The alleged lack of economic theory 
underlying the models; the sufficiency of the models for policy-making; 
potential flaws in the models' inputs and assumptions (including the 
discount rates and climate sensitivity chosen); whether there was 
adequate peer review of the three models; whether there was adequate 
peer review of the TSD supporting the 2013 SCC values; whether the SCC 
estimates comply with OMB's ``Final Information Quality Bulletin for 
Peer Review'' \63\ and DOE's own guidelines for ensuring and maximizing 
the quality, objectivity, utility and integrity of information 
disseminated by DOE; whether DOE's use of the updated SCC values has 
precedential effect for other agency rulemakings; and why DOE is 
considering global benefits of carbon dioxide emission reductions 
rather than solely domestic benefits. (Mercatus Center, No. 57 at pp. 
1-6; NEMA, No. 56 at pp. 25-31, U.S. Chamber et al., No. 58 at pp. 4-8)
---------------------------------------------------------------------------

    \63\ Available at: http://www.cio.noaa.gov/services_programs/pdfs/OMB_Peer_Review_Bulletin_m05-03.pdf
---------------------------------------------------------------------------

    On November 26, 2013, the Office of Management and Budget (OMB) 
announced minor technical corrections to the 2013 SCC values and a new 
opportunity for public comment on the revised TSD underlying the SCC 
estimates. Comments regarding the underlying science and potential 
precedential effect of the SCC estimates resulting from the interagency 
process should be directed to that process. See 78 FR 70586. 
Additionally, several current rulemakings also use the 2013 SCC values 
and the public is welcome to comment on the values as applied in those 
rulemakings just as the public was welcome to comment on the use and 
application of the 2010 SCC values in the many rules that were 
published using those values in the past three years.
    The U.S. Chamber et al. also stated that DOE calculates the present 
value of the costs of the NOPR to customers and manufacturers over a 
30-year period. The SCC values, on the other hand, reflect the present 
value of future climate related impacts well beyond 2100. According to 
the U.S. Chamber et al., DOE's comparison of 30 years of cost to 
hundreds of years of presumed future benefits is inconsistent and 
improper. (U.S. Chamber et al., No. 58 at pp. 5-6)
    For the analysis of national impacts of the adopted standards, DOE 
considered the lifetime impacts of fixtures shipped in a 30-year 
period. With respect to energy and energy cost savings, impacts 
continue past 30 years until all of the fixtures shipped in the 30-year 
period are retired. With respect to the valuation of CO2 
emissions reductions, DOE considers the avoided emissions over the same 
period as the energy savings. CO2 emissions have on average 
a very long residence time in the atmosphere. Thus, emissions in the 
period considered by DOE would contribute to global climate change over 
a very long time period, with associated social costs. The SCC for any 
given year represents the discounted present value, in that year and 
expressed in constant dollars, of a lengthy stream of future costs 
estimated to result from emission of a ton of CO2. It is 
worth pointing out that because of discounting, the present value of 
costs in the distant future is very small. DOE's accounting of energy 
cost savings and the value of avoided CO2 emissions 
reductions is consistent: Both consider the complete impacts associated 
with products shipped in the 30-year period.
2. Valuation of Other Emissions Reductions
    DOE investigated the potential monetary benefit of reduced 
NOX emissions from the TSLs it considered. As noted in 
section V.L, DOE has taken into account how new energy conservation 
standards would reduce NOX emissions in those 28 states that 
are not affected by emissions caps. DOE estimated the monetized value 
of NOX emissions reductions resulting from each of the TSLs 
considered for today's final rule based on estimates found in the 
relevant scientific literature. Estimates of monetary value for 
reducing NOX from stationary sources range from $468 to 
$4,809 per ton (in 2012$).\64\ DOE calculated the monetary benefits 
using a medium value for NOX emissions of $2,639 per short 
ton (in 2012$) and real discount rates of 3 percent and 7 percent.
---------------------------------------------------------------------------

    \64\ 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.
---------------------------------------------------------------------------

    DOE is evaluating appropriate monetization of avoided 
SO2 and Hg emissions in energy conservation standards 
rulemakings. It has not included monetization in the current analysis.

VI. Other Issues for Discussion

A. Proposed Standard Levels in August 2013 NOPR

    In the NOPR, DOE proposed new and revised energy conservation 
standards for all equipment classes. Specifically, DOE proposed TSL 3, 
which comprised EL2 for all equipment classes except the 100 W-150 W 
indoor and outdoor equipment classes, for which DOE proposed EL4. DOE 
received comment from several interested parties regarding these 
proposals.
    ULT noted the proposal that 150 W MHLFs exempted by EISA 2007 
(fixtures designed for use in high temperature and wet environments) 
were subject to EL4, while 150 W MHLFs not exempted by EISA 2007 were 
only subject to EL2. ULT questioned why the NOPR proposed lower 
efficiencies for fixtures that operate in less severe conditions. (ULT, 
No. 50 at p. 2) As discussed previously in section V.A.2 of this 
notice, the EISA 2007 exemption for certain 150 W MHLFs led to a 
difference in the commercially available efficiencies in MH ballasts 
that are exempt or are not exempt from EISA 2007. As a result, DOE 
proposed that 150 W MHLFs previously exempt by EISA 2007 be included in 
the 101 W-150 W range, while 150 W MHLFs subject to EISA 2007 standards 
continue to be included in the 150 W-250 W range. For the 101 W-150 W 
MHLFs, DOE found that EL4, the max-tech level, was economically 
justified. However, for the 150 W-250

[[Page 7800]]

W MHLFs, DOE found that the maximum EL achievable with positive NPV was 
the magnetic ballast max-tech level, EL2 at 88.0 percent. Therefore, in 
the NOPR, the economic results for the nation supported a higher 
standard for MHLFs included in the 101 W-150 W range.
    ULT commented that NOPR TSL 3 requires a shift to electronic 
ballasts, which will not work very well in outdoor applications. 
Further, ULT noted that the NOPR TSLs all appeared to be modeled or 
mandated without regard to the application, and seemed not to make 
practical sense. (ULT, Public Meeting Transcript, No. 48 at p. 215). 
NEMA and ULT commented that NOPR TSL 3 would require a shift to 
electronic ballasts in 70 W, 150 W, and 250 W fixtures, ban probe-start 
ballasts, and eliminate many of the magnetic ballast performance 
features, as these are not feasible in the mandated electronic HF 
ballasts. (NEMA, No. 56 at p. 24; ULT, No. 50 at p. 16). ULT commented 
that there should be some way to validate the TSLs. ULT suggested that 
DOE should build these models, and then allow the manufacturers to test 
them. They explained that results are much different in a lab 
environment with more resources and time than in manufacturing 
facilities that make hundreds of ballasts every 15 minutes. In 
situations with many variable materials, modeled and laboratory 
efficiencies differ greatly from those feasibly possible in a 
manufacturing facility. (ULT, Public Meeting Transcript, No. 48 at pp. 
216, 218) ULT stated that overall the NOPR TSLs are too stringent, and 
proposed different standards. (ULT, No. 50 at p. 16)
    DOE acknowledges that standards proposed for 100 W-150 W MHLFs in 
the NOPR would require a shift to electronic ballasts. While DOE 
recognizes that magnetic ballasts are inherently more robust than 
electronic ballasts, the NOPR accounted for the cost of added 
protection to electronic ballasts in outdoor applications. DOE 
continues to use this methodology in this final rule. For details of 
the determination that electronic ballasts could be used in these same 
applications with certain cost adders, see section V.C.8.b. For details 
of the cost adders required by electronic ballasts being used in the 
same application as magnetic ballasts, see section V.C.12.
    DOE has modeled ballasts in both the NOPR and final rule, utilizing 
teardown data and manufacturer input. Further research and refinement 
was performed for the modeled ballasts for this final rule in response 
to comments. See section V.C.8 for discussion of these models. DOE has 
not included high-frequency electronic ballasts in the scope of this 
rulemaking because there is no test method for them. See section 
III.A.4 for more details. As a result, none of the ELs analyzed in this 
final rule require high-frequency electronic ballasts. A more detailed 
discussion of the TSLs newly analyzed and chosen in this final rule is 
available later in this section.
    ASAP urged DOE to adopt the maximum cost-effective ELs. (ASAP, 
Public Meeting Transcript, No. 48 at p. 17) DOE analyzed several 
combinations of ELs in the NOPR and in the final rule. These 
combinations of ELs, called TSLs, can represent many criteria, 
including maximum energy savings, technology descriptions (such as all 
max-tech magnetic ELs), or maximum energy savings with cost effective 
ELs. As discussed in section VII.C of this notice, DOE adopted the TSL 
that saved the most energy and was economically justified for 
customers, manufactures, and the nation based on a weighing of costs 
and benefits.
    ULT commented that NOPR TSL 3 did not meet the requirement of a 
three-year PBP, but instead PBPs seemed to range from 4 to 14 years 
(ULT, No. 50 at p. 15). DOE does not have a specific minimum PBP 
requirement. Each equipment class is analyzed individually based on the 
market and economic analyses and the cost and benefits of all results 
are weighted. See section VII.B.1.a for discussions of the PBPs 
associated with the levels analyzed in this final rule.
    NEMA commented that it is very difficult to determine the final net 
benefit of TSL 3 from NOPR Tables VI.47 and VI.48, and DOE has not 
aided the reader in understanding its conclusion. (NEMA, No. 56 at p. 
25). NEMA commented that DOE appropriately considered a range of values 
for carbon emissions reductions, but noted that these values are only 
informative and should not be used for regulatory decision-making. 
(NEMA, No. 56 at p. 26).
    In this final rule, DOE analyzed the benefits and burdens of a 
number of TSLs for the metal halide lamp fixtures that are the subject 
of today's final rule. In accordance with (42 U.S.C. 6295(o)(2)(B)(i)), 
DOE must weigh the cost and benefits of seven factors, including other 
factors the Secretary considers relevant. DOE continues to present and 
consider a range of carbon emission reduction values in its weighing of 
the costs and benefits of any adopted standard. Regarding presentation 
of a final net benefit value, DOE directs NEMA to Table I.4.
    The Joint Comment suggested that DOE evaluate an additional TSL, 
identical to NOPR TSL 5 except that efficiency levels for 250-500 W 
ballasts would be based on EL3, which represents low-frequency 
electronic ballasts. (Joint Comment, No. 62 at p. 5). As discussed in 
section III.A.4, DOE is no longer considering standards that require 
use of high-frequency electronic ballasts because they are not in the 
scope of this rulemaking. Therefore, the max-tech levels for 50 W-1000 
W fixtures are all represented by low-frequency ballasts, removing the 
need for the additional TSL suggested by the Joint Comment.

B. Reported Value

    The sampling and reporting for the testing of MHLFs and, by 
extension, MH ballasts are provided for in 10 CFR 429.54. The reported 
value for the tested ballast efficiency of a model must be less than or 
equal to the lower of the mean of the samples tested or the lower 99 
percent confidence limit (LCL) of the true mean divided by 0.99.
    CA IOUs supported DOE's proposal to apply a confidence interval, 
which is consistent with the approach used for other products and 
accounts for variation in product testing and manufacturing. (CA IOUs, 
No. 54 at p. 3). Some stakeholders commented that because of the 
variation present in MHLFs, standard levels should be rounded to the 
nearest whole number rather than tenth of a percent (i.e., 88 percent 
rather than 88.0 percent). ULT and NEMA noted the variations in wire 
cross sections (up to 3 percent) and core lamination thickness (up to 
10 percent) create efficiency losses in the ballasts. The combination 
of efficiency losses in these two areas and variability in 
manufacturing combined with the 99 percent confidence factor, makes the 
precise proposed levels unachievable in full-scale manufacturing 
facilities. (ULT, Public Meeting Transcript, No. 48 at pp. 34, 90; 
NEMA, Public Meeting Transcript, No. 48 at p. 34; NEMA, No. 44 at pp. 
10, 13; ULT, No. 50 at pp. 3-4, 25-29). Further, NEMA noted that its 
white paper NEMA LSD-63-2012 on variability estimated the tolerance for 
a sample of four magnetic ballasts to be 4.7 percent when a confidence 
factor of 99 percent is required. (NEMA, No. 56 at p. 8) Due to the 
variability of raw material properties resulting in varied 
efficiencies, NEMA, Musco Lighting, and ULT suggested a less precise 
designation of the efficiency threshold. NEMA and ULT suggested 
carrying out all calculations to the tenth of a decimal

[[Page 7801]]

place, with the result then rounded to the nearest integer using the 
round half up rule. Musco Lighting agreed, suggesting reporting ballast 
efficiency as a whole integer. (NEMA, No. 56 at p. 8; Musco Lighting, 
No. 55 at p. 4; ULT, No. 50 at pp. 3, 4, 25; ULT, Public Meeting 
Transcript, No. 48 at p. 38). NEMA also commented that it would be 
better to have less precise standards initially, so that tolerances 
would not have to be created when verification and enforcement actions 
are made by DOE. (NEMA, Public Meeting Transcript, No. 48 at p. 82)
    ULT and NEMA noted that certain ballasts they manufacture, which 
are currently compliant with EISA 2007, would not meet the same 
requirements under the proposed rounding system (to the nearest tenth 
of a percent). (ULT, No. 50 at pp. 3-4; ULT, No. 50 at p. 25; ULT, 
Public Meeting Transcript, No. 48 at p. 38; NEMA, No. 44 at p. 14). 
Earthjustice asserted that current equipment that would not meet 
standards with the new rounding regulations should not be grandfathered 
in under the new statute. (Earthjustice, Public Meeting Transcript, No. 
48 at p. 86).
    As discussed in section IV.A of this notice, DOE has determined 
that the calculation of ballast efficiency is possible to the a tenth 
of a percent. In addition to information available in industry 
standards, data submitted by manufacturers has substantiated this 
conclusion in that it is represented to the tenth of a percent for some 
ballasts and fixtures in DOE's CCE database. DOE will establish energy 
conservation standards using the same number of significant figures 
(three) as the test procedure provides. Test data collected in support 
of the energy conservation standard was conducted in accordance with 
the test procedure in 10 CFR 431.324. The certification requirements of 
10 CFR 429.54 includes sampling plans that are designed to create 
conservative ratings, which ensures that customers get--at a minimum--
the efficiency indicated by the certified rating. Therefore, DOE's 
analysis considers levels of efficiency achievable given current 
manufacturing and material variability. Thus, standards are established 
and compliance with the standards determined by rounding the reported 
value to three significant figures. For 150 W-200 W fixtures that will 
be subject to a standard of 88.0 percent, DOE has accounted for 
redesign and retesting costs in the MIA by estimating that all MH 
ballasts at the baseline efficiency level for this wattage range will 
need to be redesigned if higher efficiency standards are adopted. DOE 
includes the redesign, retesting, and recertification costs as part of 
conversion costs of the MIA (see section V.I.4 of this notice for a 
complete description of the conversion costs used in the MIA).

C. Three-Year Compliance Date

    In the NOPR, DOE noted that EPCA, as amended by EISA 2007, contains 
guidelines for the compliance date of the standards adopted by this 
rulemaking. EPCA required DOE to determine whether to amend the 
standards in effect for metal halide lamp fixtures and whether any 
amended standards should apply to additional metal halide lamp 
fixtures. The Secretary was directed to publish a final rule no later 
than January 1, 2012 to determine whether the energy conservation 
standards established by EISA 2007 for metal halide lamp fixtures 
should be amended, with any amendment applicable to products 
manufactured after January 1, 2015. (42 U.S.C. 6295(hh)(2)(B)) In the 
NOPR public meeting, DOE presented the planned publication date of the 
final rule to be in January 2014 and proposed a compliance date of 
January 1, 2015.
    Several stakeholders commented on DOE's plan to publish a final 
rule in January 2014. APPA noted that the compliance date proposed in 
the NOPR is unreasonable from a process standpoint. DOE would have 
three months between the end of the NOPR comment period to the 
publication of the final rule, which is a much faster turnaround than 
previous rules. (APPA, No. 51 at p. 3) EEI also clarified that based on 
a January 2014 publication, DOE is only giving itself three months 
between receiving comments and issuing a final rule. (EEI, Public 
Meeting Transcript, No. 48 at p. 44) Musco Lighting commented that 
issuing the final rule in January 2014 would not provide sufficient 
time to appropriately review comments and modify analyses. (Musco 
Lighting, No. 55 at p. 4) APPA commented that it is important to 
consider how long the review processes of the Office of Management and 
Budget have taken in previous rulemakings. (APPA, No. 51 at p. 3)
    DOE has had sufficient time for this particular rulemaking to 
consider and develop responses to the comments received on the NOPR and 
complete the final rule analyses.
    DOE received several comments regarding the proposed amount of time 
between the publication of the final rule and the date manufacturers 
are required to comply with any amended standards. APPA and EEI 
commented that, according to workshop handouts and based on language in 
EISA 2007, DOE plans to issue a final rule in January 2014 with an 
effective date of January 1, 2015. (APPA, No. 51 at p. 3; EEI, No. 53 
at p. 2, 3) Considering this, APPA and Musco Lighting found that 
manufacturers could possibly be given less than 11 months to comply 
with the new final rule. (APPA, No. 51 at p. 3; Musco Lighting, No. 55 
at p. 4) NEMA, ASAP, and NRCA noted that, while the 2015 date was 
stipulated by 42 U.S.C. 6295(hh)(2), this was assuming the final rule 
would be completed by January 1, 2012 and the intent of EISA 2007 was 
to provide manufacturers with a three-year period before compliance to 
allow for investments and manufacturing conversion, as well as allowing 
customers sufficient time to make any necessary changes. NEMA, APPA, 
and NRCA stated that adopting anything shorter than three years is not 
reasonable. (NEMA, No. 56 at p. 3, 20; NEMA, Public Meeting Transcript, 
No. 48 at p. 21; NEMA, No. 44 at p. 2; APPA, No. 51 at p. 3; NRCA, No. 
61 at p. 1) ASAP agreed that it is not reasonable to provide less than 
one year for manufacturers to adjust for compliance, especially 
considering DOE did not comply with the provisions included in EISA 
2007 by not issuing a final rule by January 1, 2012. (APPA, No. 51 at 
p. 3) ULT commented that standard practice is three years after final 
rule and APPA urged DOE to provide manufacturers and customers with a 
three-year period between publication of the final rule and the 
effective date. (ULT, No. 50 at p. 14; APPA, No. 51 at p. 3)
    Stakeholders provided several reasons to support the need for a 
three-year interval between the publication of the final rule and the 
date of compliance. NEMA and UL noted this standard is much more 
complex and has a broader scope than the ones specified in EISA 2007, 
and that this standard has implications on both ballast and fixture 
manufacturers. (NEMA, Public Meeting Transcript, No. 48 at p. 19; NEMA, 
No. 44 at p. 2; ULT, No. 50 at p. 14) NEMA noted that, with this 
rulemaking's expanded scope, manufacturers would have to evaluate 
products not previously covered by EISA 2007, determine what products 
can be redesigned and which need to be eliminated, test new and 
modified ballasts for performance and safety, educate internal staff 
and customers, reevaluate inventory management, reevaluate 
manufacturing strategies, modify marketing materials, and work with 
suppliers and sellers. All of those logistics are required to take 
place and

[[Page 7802]]

make January 2015 an unreasonable compliance date, according to NEMA. 
(NEMA, Public Meeting Transcript, No. 48 at pp. 21, 27; NEMA, No. 44 at 
pp. 2-3, 5) NEMA also commented that while the standards specified in 
EISA 2007 primarily impacted industrial and outdoor channels, this 
rulemaking would impact new channels, such as retail consumer products 
and commercial offices with the lower wattage products. (NEMA, Public 
Meeting Transcript, No. 48 at p. 19; NEMA, No. 44 at p. 2)
    NEMA and Musco Lighting noted that with any increased efficiency 
numbers there are numerous product redesigns required, so it is 
imperative that DOE provide industry with the full three years to bring 
their products to compliance. (NEMA, No. 56 at pp. 20-21; Musco 
Lighting, No. 55 at p. 4) ULT noted the commercial market is far from 
the NOPR proposed levels, so there will need to be time for R&D and to 
prototype potential solutions. ULT commented that typical design time, 
taking into consideration Design Validation Testing, Life Test, UL, and 
other aspects of the process, is typically eight to twelve months. Even 
if they were moving three projects at once they would not be able to 
fully redesign the necessary products before January 2015, and they 
would run out of raw materials. (ULT, No. 50 at p. 14) NEMA and ULT 
also commented that DOE has to account for fixture manufacturers who 
would not be able to redesign their products until they had samples 
produced on a commercial scale from the ballast manufacturers. (NEMA, 
Public Meeting Transcript, No. 48 at p. 19; ULT, No. 50 at p. 14)
    NEMA noted that the difficulties with completing all of these 
redesigns with such a short compliance period include having fewer 
employees working on MHLFs than there were in 2007 and having resources 
focused on R&D for other technologies. Taking resources from these 
areas to complete the necessary redesigns would also divert the speed 
of the market transition to more efficient technologies. (NEMA; No. 44 
at p. 2) Southern Company also expressed concern that a compliance date 
of January 1, 2015, would force manufacturers to divert resources from 
the development and implementation of energy efficient technologies, 
such as LED, and this would increase the cost to customers and slow the 
conversion to LED. (Southern Company, No. 64 at p. 3)
    The Joint Comment noted that if the compliance date of the 
rulemaking is three years after the final rule is published, the 
delayed compliance date would decrease the potential energy savings 
from the rulemaking. While the Joint Comment recognizes that compliance 
with standards with a one-year compliance period may not be feasible, 
the Joint Comment urged DOE to attempt to balance additional energy 
savings from an earlier effective date with the impacts on 
manufacturers. (Joint Comment, No. 62 at p. 10)
    DOE recognizes that any compliance date subsequent to January 1, 
2015, will lead to reduced energy savings compared to the NOPR. 
However, DOE believes that it would be difficult for both ballast and 
fixture manufacturers to redesign their product lines given the 
compliance date proposed in the NOPR. As such, this final rule has 
revised the compliance date to be three years after publication of this 
final rule in the Federal Register.

VII. Analytical Results

A. Trial Standard Levels

    In the following sections, DOE presents the analytical results for 
the TSLs of the equipment classes that DOE analyzed directly. DOE 
scaled the ELs for these representative equipment classes to create ELs 
for other equipment classes that were not directly analyzed as set 
forth in chapter 5 of the TSD. For more details on the representative 
equipment classes, please see section V.C.2.

                                                           Table VII.1--Trial Standard Levels
--------------------------------------------------------------------------------------------------------------------------------------------------------
            Rep. Wattage                      TSL 1                   TSL 2                  TSL 3                  TSL 4                  TSL 5
--------------------------------------------------------------------------------------------------------------------------------------------------------
70 W Indoor........................  EL1...................  EL2...................  EL2..................  EL3..................  EL4.
70 W Outdoor.......................  EL1...................  EL2...................  EL2..................  EL3..................  EL4.
150 W Indoor.......................  EL1...................  EL2...................  EL2..................  EL3..................  EL4.
150 W Outdoor......................  EL1...................  EL2...................  EL2..................  EL3..................  EL4.
250 W Indoor.......................  EL1...................  EL1...................  EL2..................  EL3..................  EL4.
250 W Outdoor......................  EL1...................  EL1...................  EL2..................  EL3..................  EL4.
400 W Indoor.......................  EL1...................  EL2...................  EL2..................  EL3..................  EL4.
400 W Outdoor......................  EL1...................  EL2...................  EL2..................  EL3..................  EL4.
1000 W Indoor......................  EL2+DS................  EL2+DS................  EL2+DS...............  EL2+DS...............  EL2+DS.
1000 W Outdoor.....................  EL2+DS................  EL2+DS................  EL2+DS...............  EL2+DS...............  EL2+DS.
1500 W Indoor......................  Baseline..............  Baseline..............  Baseline.............  EL1..................  EL2.
1500 W Outdoor.....................  Baseline..............  Baseline..............  Baseline.............  EL1..................  EL2
--------------------------------------------------------------------------------------------------------------------------------------------------------
* DS is a design standard that bans the use of probe-start ballasts in new metal halide lamp fixtures.

    TSL 5 represents the max-tech efficiency levels available. TSL 5 
would set energy conservation standards at EL4 for indoor and outdoor 
fixtures at 70 W, 150 W, 250 W, and 400 W. Energy conservation 
standards for indoor and outdoor fixtures at 1000 W, and 1500 W are set 
at EL2. TSL 5 also includes a design standard for indoor and outdoor 
1000 W fixtures that prohibits the sale of probe-start ballasts in new 
fixtures. Standards included in TSL 5 require fixtures that contain 
max-tech electronic ballasts using high-grade electronic components, 
while indoor and outdoor fixtures at 1000 and 1500 W require max-tech 
magnetic ballasts using high-grade steel and copper windings. All 
ballasts required by TSL 5 are commercially available, except indoor 
and outdoor 1000 W and 1500 W ballasts, which are modeled.\65\ TSL 5 
sets the same standards for indoor and outdoor representative equipment 
classes at the same wattage.
---------------------------------------------------------------------------

    \65\ The 501 W-1000 W equipment class requires modeled 1000 W 
ballasts, but 875 W ballasts are commercially available.
---------------------------------------------------------------------------

    TSL 4 represents the next highest efficiency levels in classes 
where efficiency levels were not justified at TSL 5. TSL 4 would set 
energy conservation standards at EL3 for indoor and outdoor fixtures at 
70 W, 150 W, 250 W, and 400 W. Energy conservation standards for indoor 
and outdoor fixtures at 1000 W are set at EL2, and standards for indoor 
and outdoor fixtures at 1500 W are set at EL1. TSL 4 also includes a 
design standard for

[[Page 7803]]

indoor and outdoor 1000 W fixtures that prohibits the sale of probe-
start ballasts in new fixtures. Standards included in TSL 4 require 
fixtures that include standard-grade electronic ballasts, while indoor 
and outdoor fixtures at 1000 W require max-tech magnetic ballasts using 
high grade steel and copper windings, and 1500 W ballasts are mid-grade 
magnetic ballasts requiring mid-grade steel and copper wiring. At TSL 
4, all ballasts are commercially available, with the exception of the 
1000 W ballasts, which are modeled.\65\ TSL 4 sets the same standards 
for indoor and outdoor representative equipment classes at the same 
wattage.
    TSL 3 represents the next highest efficiency levels in classes 
where efficiency levels were not justified at TSL 4, while also 
requiring the same EL for both indoor and outdoor fixtures at the same 
wattage. TSL 3 would set energy conservation standards at EL2 for all 
classes except 1500 W, which would remain at baseline levels. TSL 3 
also includes a design standard for indoor and outdoor 1000 W fixtures 
that prohibits the sale of probe-start ballasts in new fixtures. Except 
for 1500 W fixtures, the standards included in TSL 3 require fixtures 
that include max-tech magnetic ballasts using high-grade steel and 
copper windings. Any ballast could be used with 1500 W fixtures because 
no efficiency level is proposed for them. At TSL 3 only the 1500 W 
ballasts are commercially available, while the other wattages were 
modeled.\65\ TSL 3 sets the same standards for indoor and outdoor 
representative equipment classes at the same wattage.
    TSL 2 represents the highest magnetic ELs that have positive NPVs, 
and also requires the same EL for both indoor and outdoor fixtures at 
the same wattage. TSL 2 would set energy conservation standards at EL2 
for indoor and outdoor fixtures at 70 W, 150 W, 400 W, and 1000 W. TSL 
2 would require EL1 for 250 W indoor and outdoor fixtures, while all 
1500 W fixtures would have no energy conservation standards (baseline). 
TSL 2 also includes a design standard for indoor and outdoor 1000 W 
fixtures that prohibits the sale of probe-start ballasts in new 
fixtures. Standards included in TSL 2 require fixtures that include 
max-tech magnetic ballasts requiring high-grade steel and copper 
windings, although 250 W ballasts typically require mid-grade steel and 
copper windings, and any ballast could be used with the unregulated 
1500 W fixtures. At TSL 2 the 70 W, 150 W, 400 W, and 1000 W indoor and 
outdoor ballasts are not commercially available, and have been 
modeled,\65\ while 250 W and 1500 W indoor and outdoor ballasts are 
commercially available. TSL 2 sets the same standards for indoor and 
outdoor representative equipment classes at the same wattage.
    TSL 1 represents EL1 at all equipment classes, except at 1000 W, in 
which EL2 and a design standard is required, and 1500 W, in which no 
standards are established. TSL 1 would set energy conservation 
standards at EL1 for indoor and outdoor fixtures at 70 W, 150 W, 250 W, 
and 400 W, while setting standards at EL2 for indoor and outdoor 1000 W 
fixtures, and no standards for 1500 W fixtures. TSL 1 also includes a 
design standard for indoor and outdoor 1000 W fixtures that prohibits 
the sale of probe-start ballasts in new fixtures. TSL 1 requires 
fixtures that include magnetic ballasts using mid-grade steel and 
copper windings, although 1000 W will require max-tech ballasts using 
high-grade steel and copper windings. At TSL 1 the only ballasts that 
are not commercially available are in the 400 W and 1000 W classes, 
which have been modeled.\65\ TSL 1 sets the same standards for indoor 
and outdoor representative equipment classes at the same wattage.

B. Economic Justification and Energy Savings

1. Economic Impacts on Individual Customers
a. Life-Cycle Cost and Payback Period
    To evaluate the net economic impact of standards on customers, DOE 
conducted LCC and PBP analyses for each TSL. In general, a higher 
efficiency product would affect consumers in two ways: (1) Annual 
operating expense would decrease; and (2) purchase price would 
increase. Section V.F of this rulemaking discusses the inputs DOE used 
for calculating the LCC and PBP.
    The key outputs of the LCC analysis are a mean LCC savings relative 
to the baseline case, as well as a probability distribution or 
likelihood of LCC reduction or increase, for each TSL and equipment 
class. These values are reported by equipment class in Table VII.2 
through Table VII.15. The LCC analysis also estimates the fraction of 
customers for which the LCC will decrease (net benefit) or increase 
(net cost) relative to the baseline case. The last column in each table 
contains the median PBPs for the customer purchasing a design compliant 
with the TSL. DOE assumed that, on average, indoor and outdoor fixtures 
have 20- and 25-year lifetimes, respectively.

                   Table VII.2--Equipment Class 1--70 Watt Metal Halide Lamp Fixtures (Indoor, Magnetic Baseline): LCC and PBP Results
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                       Life-cycle cost  2012$                Life-cycle cost savings
                                                              ------------------------------------------------------------------------------    Median
                                                                                                                     Percent of  customers     payback
         Trial standard level             Efficiency  level     Installed    Discounted                 Average        that  experience         period
                                                                   cost      operating       LCC        savings   --------------------------    years
                                                                                cost                     2012$       Net cost   Net benefit
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                       Baseline..............       442.74       955.48      1398.23  ...........  ...........  ...........  ...........
1....................................  1.....................       445.68       925.58      1371.26        26.97            0          100          1.4
2, 3.................................  2.....................       454.07       917.16      1371.23        27.00            0          100          4.5
4....................................  3.....................       459.38       896.35      1355.72        42.50           18           82          3.7
5....................................  4.....................       472.78       888.19      1360.97        37.25           21           79          6.0
--------------------------------------------------------------------------------------------------------------------------------------------------------

[[Page 7804]]

                  Table VII.3--Equipment Class 1--70 Watt Metal Halide Lamp Fixtures (Indoor, Electronic Baseline): LCC and PBP Results
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                       Life-cycle cost  2012$                Life-cycle cost savings
                                                              ------------------------------------------------------------------------------    Median
                                                                                                                     Percent of  customers     payback
         Trial standard level             Efficiency  level     Installed    Discounted                 Average        that  experience         period
                                                                   cost      operating       LCC        savings   --------------------------    years
                                                                                cost                     2012$       Net cost   Net benefit
--------------------------------------------------------------------------------------------------------------------------------------------------------
1, 2, 3, 4...........................  Baseline/3............       459.38       896.35      1355.72  ...........  ...........  ...........  ...........
5....................................  4.....................       472.78       888.19      1360.97        -5.25           90           10         31.5
--------------------------------------------------------------------------------------------------------------------------------------------------------

                  Table VII.4--Equipment Class 1--70 Watt Metal Halide Lamp Fixtures (Outdoor, Magnetic Baseline): LCC and PBP Results
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                       Life-cycle cost  2012$                Life-cycle cost savings
                                                              ------------------------------------------------------------------------------    Median
                                                                                                                     Percent of  customers     payback
         Trial standard level             Efficiency  level     Installed    Discounted                 Average        that  experience         period
                                                                   cost      operating       LCC        savings   --------------------------    years
                                                                                cost                     2012$       Net cost   Net benefit
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                       Baseline..............       793.69      2195.72      2989.41  ...........  ...........  ...........  ...........
1....................................  1.....................       796.50      2158.67      2955.17        34.24            2           98          1.4
2, 3.................................  2.....................       804.53      2149.99      2954.53        34.88            3           97          4.5
4....................................  3.....................       834.98      2159.40      2994.38        -4.98           49           51         12.0
5....................................  4.....................       847.83      2152.73      3000.55       -11.15           51           49         14.7
--------------------------------------------------------------------------------------------------------------------------------------------------------

                 Table VII.5--Equipment Class 1--70 Watt Metal Halide Lamp Fixtures (Outdoor, Electronic Baseline): LCC and PBP Results
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                       Life-cycle cost  2012$                Life-cycle cost savings
                                                              ------------------------------------------------------------------------------    Median
                                                                                                                     Percent of  customers     payback
         Trial standard level             Efficiency  level     Installed    Discounted                 Average        that  experience         period
                                                                   cost      operating       LCC        savings   --------------------------    years
                                                                                cost                     2012$       Net cost   Net benefit
--------------------------------------------------------------------------------------------------------------------------------------------------------
1, 2, 3, 4...........................  Baseline/3............       834.98      2159.40      2994.38  ...........  ...........  ...........  ...........
5....................................  4.....................       847.83      2152.73      3000.55        -6.17           88           12         55.8
--------------------------------------------------------------------------------------------------------------------------------------------------------

                            Table VII.6--Equipment Class 2--150 Watt Metal Halide Lamp Fixtures (Indoor): LCC and PBP Results
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                       Life-cycle cost  2012$                Life-cycle cost savings
                                                              ------------------------------------------------------------------------------    Median
                                                                                                                     Percent of  customers     payback
         Trial standard level             Efficiency  level     Installed    Discounted                 Average        that  experience         period
                                                                   cost      operating       LCC        savings   --------------------------    years
                                                                                cost                     2012$       Net cost   Net benefit
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                       Baseline..............       483.03      1521.22      2004.25  ...........  ...........  ...........  ...........
1....................................  1.....................       491.93      1489.89      1981.82        22.43            0          100          4.3
2, 3.................................  2.....................       504.66      1474.96      1979.62        24.63            1           99          7.3
4....................................  3.....................       503.20      1411.38      1914.58        89.67            6           94          2.5
5....................................  4.....................       522.42      1405.72      1928.14        76.11           11           89          4.8
--------------------------------------------------------------------------------------------------------------------------------------------------------

                           Table VII.7--Equipment Class 2--150 Watt Metal Halide Lamp Fixtures (outdoor): LCC and PBP Results
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                       Life-cycle cost  2012$                Life-cycle cost savings
                                                              ------------------------------------------------------------------------------    Median
                                                                                                                     Percent of  customers     payback
         Trial standard level             Efficiency  level     Installed    Discounted                 Average        that  experience         period
                                                                   cost      operating       LCC        savings   --------------------------    years
                                                                                cost                     2012$       Net cost   Net benefit
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                       Baseline..............       808.79      2679.99      3488.78  ...........  ...........  ...........  ...........
1....................................  1.....................       817.32      2644.09      3461.41        27.37            3           97          4.5
2, 3.................................  2.....................       829.51      2628.57      3458.08        30.70            3           97          8.1
4....................................  3.....................       855.33      2581.21      3436.54        52.23           34           66          7.5

[[Page 7805]]

 
5....................................  4.....................       873.73      2578.45      3452.18        36.60           38           62         10.3
--------------------------------------------------------------------------------------------------------------------------------------------------------

                            Table VII.8--Equipment Class 3--250 Watt Metal Halide Lamp Fixtures (Indoor): LCC and PBP Results
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                       Life-cycle cost  2012$                Life-cycle cost savings
                                                              ------------------------------------------------------------------------------    Median
                                                                                                                     Percent of  customers     payback
         Trial standard level             Efficiency  level     Installed    Discounted                 Average        that  experience         period
                                                                   cost      operating       LCC        savings   --------------------------    years
                                                                                cost                     2012$       Net cost   Net benefit
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                       Baseline..............       541.02      2122.17      2663.19  ...........  ...........  ...........  ...........
1, 2.................................  1.....................       564.55      2094.13      2658.68         4.51           40           60         14.2
3....................................  2.....................       581.65      2082.60      2664.26        -1.07           63           37         17.9
4....................................  3.....................       611.53      2111.32      2722.85       -59.67           82           18        113.2
5....................................  4.....................       604.31      2099.21      2703.52       -40.33           71           29         38.4
--------------------------------------------------------------------------------------------------------------------------------------------------------

                           Table VII.9--Equipment Class 3--250 Watt Metal Halide Lamp Fixtures (Outdoor): LCC and PBP Results
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                       Life-cycle cost  2012$                Life-cycle cost savings
                                                              ------------------------------------------------------------------------------    Median
                                                                                                                     Percent of  customers     payback
         Trial standard level             Efficiency  level     Installed    Discounted                 Average        that  experience         period
                                                                   cost      operating       LCC        savings   --------------------------    years
                                                                                cost                     2012$       Net cost   Net benefit
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                       Baseline..............      1009.36      3153.36      4162.72  ...........  ...........  ...........  ...........
1, 2.................................  1.....................      1031.89      3124.09      4155.98         6.74           33           67         17.4
3....................................  2.....................      1048.27      3112.97      4161.24         1.48           55           45         22.8
4....................................  3.....................      1109.39      3172.98      4282.37      -119.65           76           24        326.7
5....................................  4.....................      1102.47      3158.11      4260.58       -97.86           71           29        135.1
--------------------------------------------------------------------------------------------------------------------------------------------------------

                           Table VII.10--Equipment Class 4--400 Watt Metal Halide Lamp Fixtures (Indoor): LCC and PBP Results
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                       Life-cycle cost  2012$                Life-cycle cost savings
                                                              ------------------------------------------------------------------------------    Median
                                                                                                                     Percent of  customers     payback
         Trial standard level             Efficiency  level     Installed    Discounted                 Average        that  experience         period
                                                                   cost      operating       LCC        savings   --------------------------    years
                                                                                cost                     2012$       Net cost   Net benefit
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                       Baseline..............       628.46      3120.84      3749.31  ...........  ...........  ...........  ...........
1....................................  1.....................       669.22      3077.26      3746.48         2.83           53           47         16.2
2, 3.................................  2.....................       686.23      3055.12      3741.36         7.95           46           54         15.0
4....................................  3.....................       756.96      3100.09      3857.05      -107.74           92            8        369.2
5....................................  4.....................       798.21      3081.70      3879.91      -130.60           94            6        137.2
--------------------------------------------------------------------------------------------------------------------------------------------------------

                           Table VII.11--Equipment Class 4--400 Watt Metal Halide Lamp Fixtures (Outdoor): LCC and PBP Results
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                       Life-cycle cost  2012$                Life-cycle cost savings
                                                              ------------------------------------------------------------------------------    Median
                                                                                                                     Percent of  customers     payback
         Trial standard level             Efficiency  level     Installed    Discounted                 Average        that  experience         period
                                                                   cost      operating       LCC        savings   --------------------------    years
                                                                                cost                     2012$       Net cost   Net benefit
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                       Baseline..............      1077.56      4040.60      5118.16  ...........  ...........  ...........  ...........
1....................................  1.....................      1116.59      3995.41      5112.00         6.16           45           55         19.9
2, 3.................................  2.....................      1132.88      3972.13      5105.01        13.15           38           62         18.4
4....................................  3.....................      1229.74      4053.72      5283.46      -165.30           81           19        Never

[[Page 7806]]

 
5....................................  4.....................      1269.24      4036.62      5305.85      -187.69           84           16        Never
--------------------------------------------------------------------------------------------------------------------------------------------------------

                           Table VII.12--Equipment Class 5--1000 Watt Metal Halide Lamp Fixtures (Indoor): LCC and PBP Results
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                       Life-cycle cost  2012$                Life-cycle cost savings
                                                              ------------------------------------------------------------------------------    Median
                                                                                                                     Percent of  customers     payback
         Trial standard level             Efficiency  level     Installed    Discounted                 Average        that  experience         period
                                                                   cost      operating       LCC        savings   --------------------------    years
                                                                                cost                     2012$       Net cost   Net benefit
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                       Baseline..............       760.77      7861.06      8621.83  ...........  ...........  ...........  ...........
                                       Base+DS*..............         0.00         0.00         0.00         0.00            0            0          0.0
                                       Base+DS**.............       810.04      8025.13      8835.17      -213.34          100            0          N/A
                                       1.....................       816.70      7795.42      8612.12         9.71           45           55         15.2
                                       1 + DS*...............       801.73      6617.67      7419.40      1202.43            0          100          0.5
                                       1 + DS**..............       865.97      7959.48      8825.46      -203.63          100            0        Never
                                       2.....................       837.75      7770.63      8608.38        13.45           45           55         15.2
1, 2, 3, 4, 5........................  2 + DS*...............       830.98      6569.31      7400.29      1221.54            0          100          0.8
                                       2 + DS**..............       887.02      7934.70      8821.72      -199.89          100            0        Never
--------------------------------------------------------------------------------------------------------------------------------------------------------
* DS = Design Standard prohibits fixtures from containing a probe-start ballast. A percentage of customers in this equipment class will migrate to these
  fixtures, which are reduced-wattage 875 W systems.
** Design Standard 1000 W pulse-start fixtures. Customers who do not migrate to 875 W systems will choose these 1000 W systems.

                          Table VII.13--Equipment Class 5--1000 Watt Metal Halide Lamp Fixtures (Outdoor): LCC and PBP Results
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                       Life-cycle cost  2012$                Life-cycle cost savings
                                                              ------------------------------------------------------------------------------    Median
                                                                                                                     Percent of  customers     payback
         Trial standard level             Efficiency  level     Installed    Discounted                 Average        that  experience         period
                                                                   cost      operating       LCC        savings   --------------------------    years
                                                                                cost                     2012$       Net cost   Net benefit
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                       Baseline..............      1184.62      9152.48    10,337.10  ...........  ...........  ...........  ...........
                                       Base+DS*..............         0.00         0.00         0.00         0.00            0            0          0.0
                                       Base+DS**.............      1239.95      9435.92    10,675.88      -338.78          100            0          N/A
                                       1.....................      1238.18      9081.54    10,319.72        17.37           30           70         17.0
                                       1 + DS*...............      1231.48      7497.64      8729.12      1607.97            0          100          0.5
                                       1 + DS**..............      1293.52      9364.98    10,658.50      -321.40          100            0        Never
                                       2.....................      1258.34      9054.76    10,313.10        24.00           30           70         17.0
1, 2, 3, 4, 5........................  2 + DS*...............      1259.49      7445.67      8705.16      1631.94            2           98          0.8
                                       2 + DS**..............      1313.68      9338.20    10,651.88      -314.78          100            0        Never
--------------------------------------------------------------------------------------------------------------------------------------------------------
* DS = Design Standard prohibits fixtures from containing a probe-start ballast. A percentage of customers in this equipment class will migrate to these
  fixtures, which are reduced-wattage 875 W systems.
** Design Standard 1000 W pulse-start fixtures. Customers who do not migrate to 875 W systems will choose these 1000 W systems.

                           Table VII.14--Equipment Class 6--1500 Watt Metal Halide Lamp Fixtures (Indoor): LCC and PBP Results
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                       Life-cycle cost  2012$                Life-cycle cost savings
                                                              ------------------------------------------------------------------------------    Median
                                                                                                                     Percent of  customers     payback
         Trial standard level             Efficiency  level     Installed    Discounted                 Average        that  experience         period
                                                                   cost      operating       LCC        savings   --------------------------    years
                                                                                cost                     2012$       Net cost   Net benefit
--------------------------------------------------------------------------------------------------------------------------------------------------------
1, 2, 3..............................  Baseline..............       908.54       914.31      1822.86         0.00  ...........  ...........  ...........
4....................................  1.....................       980.76       909.25      1890.01       -67.15          100            0        209.4
5....................................  2.....................      1010.83       905.09      1915.92       -93.06          100            0        162.7
--------------------------------------------------------------------------------------------------------------------------------------------------------

[[Page 7807]]

                          Table VII.15--Equipment Class 6--1500 Watt Metal Halide Lamp Fixtures (Outdoor): LCC and PBP Results
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                       Life-cycle cost  2012$                Life-cycle cost savings
                                                              ------------------------------------------------------------------------------    Median
                                                                                                                     Percent of  customers     payback
         Trial standard level             Efficiency  level     Installed    Discounted                 Average        that  experience         period
                                                                   cost      operating       LCC        savings   --------------------------    years
                                                                                cost                     2012$       Net cost   Net benefit
--------------------------------------------------------------------------------------------------------------------------------------------------------
1, 2, 3..............................  Baseline..............      1276.71      1203.04      2479.75         0.00  ...........  ...........  ...........
4....................................  1.....................      1345.86      1197.60      2543.46       -63.71          100            0        244.5
5....................................  2.....................      1374.66      1193.11      2567.78       -88.03          100            0        190.0
--------------------------------------------------------------------------------------------------------------------------------------------------------

b. Customer Subgroup Analysis
    Using the LCC spreadsheet model, DOE determined the effect of the 
trial standard levels on the following customer subgroups: utilities, 
owners of transportation facilities, warehouse owners, owners of 
transient-prone outdoor lighting, and owners of transient-prone indoor 
lighting in heavy industrial facilities. DOE adjusted particular inputs 
to the LCC model to reflect conditions faced by the identified 
subgroups. For utilities, DOE assumed that maintenance costs would be 
higher than average maintenance costs because utilities have to 
maintain more equipment than the other subgroups do, and that operating 
costs are lower than average because utilities pay wholesale rates for 
electricity instead of retail rates. DOE assumed that owners of 
transportation facilities face higher annual operating hours than the 
average used in the main LCC analysis. For warehouse owners, DOE 
assumed lower annual operating hours than average used in the main LCC 
analysis. DOE assumed that owners of transient-prone outdoor lighting 
face more frequent surge protection and ballast replacements because of 
lightning than the average used in the main LCC analysis. Finally, for 
owners of heavy industrial facilities, DOE assumed that indoor lighting 
equipment (250 W and 400 W equipment classes only) faced more frequent 
surge protection and ballast replacements because of voltage transients 
than the average used in the main LCC analysis.
    Table VII.16 through Table VII.27 show the LCC effects and PBPs for 
identified subgroups that purchase metal halide lamp fixtures. In 
general, the average LCC savings for the identified subgroups at the 
considered efficiency levels are significantly different from the 
average for all customers.

                  Table VII.16--Equipment Class 1--70 Watt Metal Halide Lamp Fixtures (Indoor, Magnetic Baseline): LCC Subgroup Results
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                       Life-cycle cost 2012$                 Life-cycle cost savings
                                                              ------------------------------------------------------------------------------    Median
                                                                                                                     Percent of customers      payback
         Trial standard level             Efficiency level      Installed    Discounted                 Average        that  experience         period
                                                                   cost      operating       LCC        Savings   --------------------------    years
                                                                                cost                     2012$       Net cost   Net benefit
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                   Subgroup: Utilities
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                       Baseline..............       442.76       444.35       887.11  ...........  ...........  ...........  ...........
1....................................  1.....................       445.70       444.92       890.62        -3.50        100.0          0.0        Never
2, 3.................................  2.....................       454.09       446.85       900.94       -13.82        100.0          0.0        Never
4....................................  3.....................       459.40       477.98       937.38       -50.26         93.7          6.3        Never
5....................................  4.....................       472.80       483.06       955.86       -68.75         98.0          2.0        Never
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                        Subgroup: Transportation Facility Owners
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                       Baseline..............       442.76       979.64     1,422.40  ...........  ...........  ...........  ...........
1....................................  1.....................       445.70       948.60     1,394.30        28.10          0.0        100.0          1.4
2, 3.................................  2.....................       454.09       939.88     1,393.97        28.43          0.0        100.0          4.3
4....................................  3.....................       459.40       923.95     1,383.35        39.05         17.4         82.6          3.8
5....................................  4.....................       472.80       915.84     1,388.64        33.76         20.9         79.1          6.3
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                               Subgroup: Warehouse Owners
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                       Baseline..............       442.76       936.53     1,379.29  ...........  ...........  ...........  ...........
1....................................  1.....................       445.70       906.98     1,352.68        26.61          0.0        100.0          1.5
2, 3.................................  2.....................       454.09       898.53     1,352.62        26.67          0.1         99.9          4.6
4....................................  3.....................       459.40       878.47     1,337.87        41.42         17.4         82.6          3.5
5....................................  4.....................       472.80       870.24     1,343.05        36.25         19.9         80.1          5.9
--------------------------------------------------------------------------------------------------------------------------------------------------------

[[Page 7808]]

                 Table VII.17--Equipment Class 1--70 Watt Metal Halide Lamp Fixtures (Indoor, Electronic Baseline): LCC and PBP Results
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                       Life-cycle cost 2012$                 Life-cycle cost savings
                                                              ------------------------------------------------------------------------------    Median
                                                                                                                     Percent of customers      payback
         Trial standard level             Efficiency level      Installed    Discounted                 Average        that  experience         period
                                                                   cost      operating       LCC        Savings   --------------------------    years
                                                                                cost                     2012$       Net cost   Net benefit
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                   Subgroup: Utilities
--------------------------------------------------------------------------------------------------------------------------------------------------------
1, 2, 3, 4...........................  Baseline/3............       459.40       477.98       937.38  ...........  ...........  ...........  ...........
5....................................  4.....................       472.80       483.06       955.86       -18.49        100.0          0.0        Never
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                        Subgroup: Transportation Facility Owners
--------------------------------------------------------------------------------------------------------------------------------------------------------
1, 2, 3, 4...........................  Baseline/3............       459.40       923.95     1,383.35  ...........  ...........  ...........  ...........
5....................................  4.....................       472.80       915.84     1,388.64        -5.29         88.8         11.2         31.9
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                               Subgroup: Warehouse Owners
--------------------------------------------------------------------------------------------------------------------------------------------------------
1, 2, 3, 4...........................  Baseline/3............       459.40       878.47     1,337.87  ...........  ...........  ...........  ...........
5....................................  4.....................       472.80       870.24     1,343.05        -5.17         89.5         10.5         30.5
--------------------------------------------------------------------------------------------------------------------------------------------------------

                  Table VII.18--Equipment Class 1--70 Watt Metal Halide Lamp Fixtures (Outdoor, Magnetic Baseline): LCC and PBP Results
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                       Life-cycle cost 2012$                 Life-cycle cost savings
                                                              ------------------------------------------------------------------------------    Median
                                                                                                                     Percent of customers      payback
         Trial standard level             Efficiency level      Installed    Discounted                 Average        that  experience         period
                                                                   cost      operating       LCC        savings   --------------------------    years
                                                                                cost                     2012$       Net cost   Net benefit
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                   Subgroup: Utilities
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                       Baseline..............       793.71     1,536.88     2,330.59  ...........  ...........  ...........  ...........
1....................................  1.....................       796.52     1,538.23     2,334.75        -4.16        100.0          0.0        Never
2, 3.................................  2.....................       804.56     1,542.56     2,347.12       -16.52        100.0          0.0        Never
4....................................  3.....................       835.01     1,620.58     2,455.59      -125.00         87.2         12.8        Never
5....................................  4.....................       847.86     1,630.51     2,478.36      -147.77         89.9         10.1        Never
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                        Subgroup: Transportation Facility Owners
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                       Baseline..............       793.69     2,195.72     2,989.41  ...........  ...........  ...........  ...........
1....................................  1.....................       796.50     2,158.67     2,955.17        34.24          1.6         98.4          1.4
2, 3.................................  2.....................       804.53     2,149.99     2,954.53        34.88          2.9         97.1          4.5
4....................................  3.....................       834.98     2,159.40     2,994.38        -4.98         49.0         51.0         12.0
5....................................  4.....................       847.83     2,152.73     3,000.55       -11.15         51.3         48.7         14.7
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                               Subgroup: Warehouse Owners
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                       Baseline..............       793.69     2,195.72     2,989.41  ...........  ...........  ...........  ...........
1....................................  1.....................       796.50     2,158.67     2,955.17        34.24          1.6         98.4          1.4
2, 3.................................  2.....................       804.53     2,149.99     2,954.53        34.88          2.9         97.1          4.5
4....................................  3.....................       834.98     2,159.40     2,994.38        -4.98         49.0         51.0         12.0
5....................................  4.....................       847.83     2,152.73     3,000.55       -11.15         51.3         48.7         14.7
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                  Subgroup: Owners of Transient-Prone Outdoor Lighting
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                       Baseline..............       793.71     2,179.70     2,973.41  ...........  ...........  ...........  ...........
1....................................  1.....................       796.52     2,142.44     2,938.97        34.44          1.8         98.2          1.4
2, 3.................................  2.....................       804.56     2,133.66     2,938.22        35.20          2.9         97.1          4.5
4....................................  3.....................       835.01     2,167.47     3,002.48       -29.07         59.2         40.8         31.3
5....................................  4.....................       847.86     2,163.21     3,011.07       -37.66         62.2         37.8         41.0
--------------------------------------------------------------------------------------------------------------------------------------------------------

[[Page 7809]]

                 Table VII.19--Equipment Class 1--70 Watt Metal Halide Lamp Fixtures (Outdoor, Electronic Baseline): LCC and PBP Results
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                       Life-cycle cost 2012$                 Life-cycle cost savings
                                                              ------------------------------------------------------------------------------    Median
                                                                                                                     Percent of customers      payback
         Trial standard level             Efficiency level      Installed    Discounted                 Average        that  experience         period
                                                                   cost      operating       LCC        savings   --------------------------    years
                                                                                cost                     2012$       Net cost   Net benefit
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                   Subgroup: Utilities
--------------------------------------------------------------------------------------------------------------------------------------------------------
1, 2, 3, 4...........................  Baseline/3............       835.01     1,620.58     2,455.59  ...........  ...........  ...........  ...........
5....................................  4.....................       847.86     1,630.51     2,478.36       -22.77        100.0          0.0        Never
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                        Subgroup: Transportation Facility Owners
--------------------------------------------------------------------------------------------------------------------------------------------------------
1, 2, 3, 4...........................  Baseline/3............       834.98     2,159.40     2,994.38  ...........  ...........  ...........  ...........
5....................................  4.....................       847.83     2,152.73     3,000.55        -6.17         87.8         12.2         55.8
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                               Subgroup: Warehouse Owners
--------------------------------------------------------------------------------------------------------------------------------------------------------
1, 2, 3, 4...........................  Baseline/3............       834.98     2,159.40     2,994.38  ...........  ...........  ...........  ...........
5....................................  4.....................       847.83     2,152.73     3,000.55        -6.17         87.8         12.2         55.8
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                  Subgroup: Owners of Transient-Prone Outdoor Lighting
--------------------------------------------------------------------------------------------------------------------------------------------------------
1, 2, 3, 4...........................  Baseline/3............       835.01     2,167.47     3,002.48  ...........  ...........  ...........  ...........
5....................................  4.....................       847.86     2,163.21     3,011.07        -8.59         94.9          5.1        161.5
--------------------------------------------------------------------------------------------------------------------------------------------------------

                           Table VII.20--Equipment Class 2--150 Watt Metal Halide Lamp Fixtures (Indoor): LCC and PBP Results
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                       Life-cycle cost 2012$                 Life-cycle cost savings
                                                              ------------------------------------------------------------------------------    Median
                                                                                                                     Percent of customers      payback
         Trial standard level             Efficiency level      Installed    Discounted                 Average        that  experience         period
                                                                   cost      operating       LCC        savings   --------------------------    years
                                                                                cost                     2012$       Net cost   Net benefit
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                   Subgroup: Utilities
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                       Baseline..............       483.05       466.08       949.13  ...........  ...........  ...........  ...........
1....................................  1.....................       491.95       468.47       960.43       -11.29        100.0          0.0        Never
2, 3.................................  2.....................       504.68       472.02       976.71       -27.57        100.0          0.0        Never
4....................................  3.....................       503.23       513.09     1,016.31       -67.18         97.0          3.0        Never
5....................................  4.....................       522.45       521.74     1,044.18       -95.05         99.6          0.4        Never
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                        Subgroup: Transportation Facility Owners
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                       Baseline..............       483.05     1,636.83     2,119.88  ...........  ...........  ...........  ...........
1....................................  1.....................       491.95     1,603.44     2,095.39        24.49          0.0        100.0          4.1
2, 3.................................  2.....................       504.68     1,587.84     2,092.53        27.35          0.7         99.3          7.0
4....................................  3.....................       503.23     1,521.09     2,024.32        95.56          7.2         92.8          2.4
5....................................  4.....................       522.45     1,515.71     2,038.15        81.73         11.1         88.9          4.6
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                               Subgroup: Warehouse Owners
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                       Baseline..............       483.05     1,494.69     1,977.73  ...........  ...........  ...........  ...........
1....................................  1.....................       491.95     1,463.62     1,955.58        22.16          0.0        100.0          4.4
2, 3.................................  2.....................       504.68     1,448.78     1,953.46        24.27          0.8         99.2          7.5
4....................................  3.....................       503.23     1,382.65     1,885.88        91.86          5.5         94.5          2.4
5....................................  4.....................       522.45     1,376.64     1,899.08        78.65         11.2         88.8          4.5
--------------------------------------------------------------------------------------------------------------------------------------------------------

                           Table VII.21--Equipment Class 2--150 Watt Metal Halide Lamp Fixtures (Outdoor): LCC and PBP Results
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                       Life-cycle cost 2012$                 Life-cycle cost savings
                                                              ------------------------------------------------------------------------------    Median
                                                                                                                     Percent of customers      payback
         Trial standard level             Efficiency level      Installed    Discounted                 Average        that  experience         period
                                                                   cost      operating       LCC        savings   --------------------------    years
                                                                                cost                     2012$       Net cost   Net benefit
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                   Subgroup: Utilities
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                       Baseline..............       808.82     1,406.87     2,215.69  ...........  ...........  ...........  ...........
1....................................  1.....................       817.35     1,411.33     2,228.68       -12.99        100.0          0.0        Never

[[Page 7810]]

 
2, 3.................................  2.....................       829.54     1,417.89     2,247.43       -31.74        100.0          0.0        Never
4....................................  3.....................       855.36     1,499.15     2,354.52      -138.83         87.1         12.9        Never
5....................................  4.....................       873.77     1,513.42     2,387.18      -171.49         90.7          9.3        Never
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                        Subgroup: Transportation Facility Owners
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                       Baseline..............       808.79     2,679.99     3,488.78  ...........  ...........  ...........  ...........
1....................................  1.....................       817.32     2,644.09     3,461.41        27.37          2.9         97.1          4.5
2, 3.................................  2.....................       829.51     2,628.57     3,458.08        30.70          3.3         96.7          8.1
4....................................  3.....................       855.33     2,581.21     3,436.54        52.23         33.8         66.2          7.5
5....................................  4.....................       873.73     2,578.45     3,452.18        36.60         38.2         61.8         10.3
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                               Subgroup: Warehouse Owners
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                       Baseline..............       808.79     2,679.99     3,488.78  ...........  ...........  ...........  ...........
1....................................  1.....................       817.32     2,644.09     3,461.41        27.37          2.9         97.1          4.5
2, 3.................................  2.....................       829.51     2,628.57     3,458.08        30.70          3.3         96.7          8.1
4....................................  3.....................       855.33     2,581.21     3,436.54        52.23         33.8         66.2          7.5
5....................................  4.....................       873.73     2,578.45     3,452.18        36.60         38.2         61.8         10.3
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                  Subgroup: Owners of Transient-Prone Outdoor Lighting
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                       Baseline..............       808.82     2,671.89     3,480.71  ...........  ...........  ...........  ...........
1....................................  1.....................       817.35     2,635.75     3,453.09        27.62          2.9         97.1          4.5
2, 3.................................  2.....................       829.54     2,620.05     3,449.58        31.13          3.2         96.8          8.1
4....................................  3.....................       855.36     2,608.06     3,463.42        17.29         47.8         52.2         11.8
5....................................  4.....................       873.77     2,608.78     3,482.55        -1.84         52.3         47.7         17.4
--------------------------------------------------------------------------------------------------------------------------------------------------------

                           Table VII.22--Equipment Class 3--250 Watt Metal Halide Lamp Fixtures (Indoor): LCC and PBP Results
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                       Life-cycle cost 2012$                 Life-cycle cost savings
                                                              ------------------------------------------------------------------------------    Median
                                                                                                                     Percent of customers      payback
         Trial standard level             Efficiency level      Installed    Discounted                 Average         that experience         period
                                                                   cost      operating       LCC        savings   --------------------------    years
                                                                                cost                     2012$       Net cost   Net benefit
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                   Subgroup: Utilities
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                       Baseline..............       541.05       490.86     1,031.91  ...........  ...........  ...........  ...........
1, 2.................................  1.....................       564.58       498.98     1,063.56       -31.66        100.0          0.0        Never
3....................................  2.....................       581.69       504.93     1,086.62       -54.71        100.0          0.0        Never
4....................................  3.....................       611.57       572.99     1,184.56      -152.65        100.0          0.0        Never
5....................................  4.....................       604.35       569.07     1,173.42      -141.51         99.9          0.1        Never
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                        Subgroup: Transportation Facility Owners
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                       Baseline..............       541.05     2,361.30     2,902.35  ...........  ...........  ...........  ...........
1, 2.................................  1.....................       564.58     2,330.88     2,895.46         6.89         30.2         69.8         13.0
3....................................  2.....................       581.69     2,318.58     2,900.26         2.08         56.2         43.8         16.6
4....................................  3.....................       611.57     2,354.22     2,965.79       -63.44         81.4         18.6        147.2
5....................................  4.....................       604.35     2,340.54     2,944.89       -42.54         70.6         29.4         39.2
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                               Subgroup: Warehouse Owners
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                       Baseline..............       541.05     2,096.87     2,637.92  ...........  ...........  ...........  ...........
1, 2.................................  1.....................       564.58     2,068.76     2,633.35         4.57         39.4         60.6         14.2
3....................................  2.....................       581.69     2,057.12     2,638.80        -0.89         62.7         37.3         17.9
4....................................  3.....................       611.57     2,086.19     2,697.76       -59.84         82.0         18.0        133.3
5....................................  4.....................       604.35     2,074.29     2,678.63       -40.72         72.1         27.9         40.0
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                   Subgroup: Owners of Transient-Prone Indoor Lighting
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                       Baseline..............       541.05     2,125.94     2,666.98  ...........  ...........  ...........  ...........
1, 2.................................  1.....................       564.58     2,097.72     2,662.30         4.68         39.7         60.3         14.1
3....................................  2.....................       581.69     2,086.10     2,667.79        -0.80         63.0         37.0         17.7

[[Page 7811]]

 
4....................................  3.....................       633.04     2,202.92     2,835.96      -168.97         99.5          0.5        Never
5....................................  4.....................       625.82     2,189.03     2,814.85      -147.86         99.0          1.0        Never
--------------------------------------------------------------------------------------------------------------------------------------------------------

                           Table VII.23 Equipment Class 3--250 Watt Metal Halide Lamp Fixtures (Outdoor): LCC and PBP Results
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                       Life-cycle cost 2012$                 Life-cycle cost savings
                                                              ------------------------------------------------------------------------------    Median
                                                                                                                     Percent of customers      payback
         Trial standard level             Efficiency level      Installed    Discounted                 Average         that experience         period
                                                                   cost      operating       LCC        savings   --------------------------    years
                                                                                cost                     2012$       Net cost   Net benefit
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                   Subgroup: Utilities
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                       Baseline..............     1,009.40     1,274.00     2,283.40  ...........  ...........  ...........  ...........
1, 2.................................  1.....................     1,031.93     1,286.12     2,318.06       -34.66        100.0          0.0        Never
3....................................  2.....................     1,048.32     1,294.99     2,343.30       -59.91        100.0          0.0        Never
4....................................  3.....................     1,109.44     1,402.28     2,511.72      -228.33         94.7          5.3        Never
5....................................  4.....................     1,102.53     1,396.84     2,499.37      -215.97         93.4          6.6        Never
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                        Subgroup: Transportation Facility Owners
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                       Baseline..............     1,009.36     3,153.36     4,162.72  ...........
1, 2.................................  1.....................     1,031.89     3,124.09     4,155.98         6.74         32.6         67.4         17.4
3....................................  2.....................     1,048.27     3,112.97     4,161.24         1.48         55.2         44.8         22.8
4....................................  3.....................     1,109.39     3,172.98     4,282.37      -119.65         76.4         23.6        326.7
5....................................  4.....................     1,102.47     3,158.11     4,260.58       -97.86         71.2         28.8        135.1
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                               Subgroup: Warehouse Owners
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                       Baseline..............     1,009.36     3,153.36     4,162.72  ...........  ...........  ...........  ...........
1, 2.................................  1.....................     1,031.89     3,124.09     4,155.98         6.74         32.6         67.4         17.4
3....................................  2.....................     1,048.27     3,112.97     4,161.24         1.48         55.2         44.8         22.8
4....................................  3.....................     1,109.39     3,172.98     4,282.37      -119.65         76.4         23.6        326.7
5....................................  4.....................     1,102.47     3,158.11     4,260.58       -97.86         71.2         28.8        135.1
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                  Subgroup: Owners of Transient-Prone Outdoor Lighting
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                       Baseline..............     1,009.40     3,152.36     4,161.76  ...........  ...........  ...........  ...........
1, 2.................................  1.....................     1,031.93     3,122.75     4,154.68         7.08         32.0         68.0         17.3
3....................................  2.....................     1,048.32     3,111.43     4,159.74         2.02         54.7         45.3         22.7
4....................................  3.....................     1,109.44     3,240.29     4,349.73      -187.97         90.0         10.0        Never
5....................................  4.....................     1,102.53     3,224.03     4,326.55      -164.79         86.7         13.3        Never
--------------------------------------------------------------------------------------------------------------------------------------------------------

                           Table VII.24--Equipment Class 4--400 Watt Metal Halide Lamp Fixtures (Indoor): LCC and PBP Results
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                       Life-cycle cost 2012$                 Life-cycle cost savings
                                                              ------------------------------------------------------------------------------    Median
                                                                                                                     Percent of customers      payback
         Trial standard level             Efficiency level      Installed    Discounted                 Average         that experience         period
                                                                   cost      operating       LCC        savings   --------------------------    years
                                                                                cost                     2012$       Net cost   Net benefit
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                   Subgroup: Utilities
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                       Baseline..............       628.50       448.11     1,076.61  ...........  ...........  ...........  ...........
1....................................  1.....................       669.26       463.69     1,132.95       -56.34        100.0          0.0        Never
2, 3.................................  2.....................       686.28       470.18     1,156.45       -79.84        100.0          0.0        Never
4....................................  3.....................       757.01       568.72     1,325.74      -249.13        100.0          0.0        Never
5....................................  4.....................       798.27       592.98     1,391.25      -314.64        100.0          0.0        Never
--------------------------------------------------------------------------------------------------------------------------------------------------------

[[Page 7812]]

 
                                                        Subgroup: Transportation Facility Owners
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                       Baseline..............       628.50     3,542.88     4,171.38  ...........  ...........  ...........  ...........
1....................................  1.....................       669.26     3,496.08     4,165.34         6.04         46.9         53.1         15.2
2, 3.................................  2.....................       686.28     3,472.11     4,158.39        13.00         38.9         61.1         14.1
4....................................  3.....................       757.01     3,527.12     4,284.13      -112.75         89.5         10.5        Never
5....................................  4.....................       798.27     3,508.32     4,306.59      -135.20         91.9          8.1        166.6
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                               Subgroup: Warehouse Owners
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                       Baseline..............       628.50     3,097.26     3,725.76  ...........  ...........  ...........  ...........
1....................................  1.....................       669.26     3,053.68     3,722.95         2.82         54.0         46.0         16.1
2, 3.................................  2.....................       686.28     3,031.58     3,717.85         7.91         46.7         53.3         15.0
4....................................  3.....................       757.01     3,077.37     3,834.39      -108.63         92.0          8.0        905.6
5....................................  4.....................       798.27     3,058.66     3,856.92      -131.16         93.8          6.2        151.6
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                   Subgroup: Owners of Transient-Prone Indoor Lighting
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                       Baseline..............       628.50     3,125.34     3,753.84  ...........  ...........  ...........  ...........
1....................................  1.....................       669.26     3,081.43     3,750.69         3.15         53.2         46.8         16.0
2, 3.................................  2.....................       686.28     3,059.14     3,745.42         8.42         45.9         54.1         15.0
4....................................  3.....................       778.48     3,212.60     3,991.09      -237.25         99.6          0.4        Never
5....................................  4.....................       819.73     3,204.61     4,024.35      -270.51         99.7          0.3        Never
--------------------------------------------------------------------------------------------------------------------------------------------------------

                           Table VII.25--Equipment Class 4--400 Watt Metal Halide Lamp Fixtures (Outdoor): LCC and PBP Results
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                       Life-cycle cost 2012$                 Life-cycle cost savings
                                                              ------------------------------------------------------------------------------    Median
                                                                                                                     Percent of customers      payback
         Trial standard level             Efficiency level      Installed    Discounted                 Average         that experience         period
                                                                   cost      operating       LCC        savings   --------------------------    years
                                                                                cost                     2012$       Net cost   Net benefit
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                   Subgroup: Utilities
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                       Baseline..............     1,077.60     1,039.14     2,116.75  ...........  ...........  ...........  ...........
1....................................  1.....................     1,116.64     1,060.17     2,176.81       -60.06        100.0          0.0        Never
2, 3.................................  2.....................     1,132.93     1,068.93     2,201.86       -85.11        100.0          0.0        Never
4....................................  3.....................     1,229.80     1,210.75     2,440.55      -323.80         98.7          1.3        Never
5....................................  4.....................     1,269.31     1,241.30     2,510.61      -393.86         99.6          0.4        Never
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                        Subgroup: Transportation Facility Owners
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                       Baseline..............     1,077.56     4,040.60     5,118.16  ...........  ...........  ...........  ...........
1....................................  1.....................     1,116.59     3,995.41     5,112.00         6.16         44.6         55.4         19.9
2, 3.................................  2.....................     1,132.88     3,972.13     5,105.01        13.15         38.1         61.9         18.4
4....................................  3.....................     1,229.74     4,053.72     5,283.46      -165.30         80.7         19.3        Never
5....................................  4.....................     1,269.24     4,036.62     5,305.85      -187.69         83.9         16.1        Never
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                               Subgroup: Warehouse Owners
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                       Baseline..............     1,077.56     4,040.60     5,118.16  ...........  ...........  ...........  ...........
1....................................  1.....................     1,116.59     3,995.41     5,112.00         6.16         44.6         55.4         19.9
2, 3.................................  2.....................     1,132.88     3,972.13     5,105.01        13.15         38.1         61.9         18.4
4....................................  3.....................     1,229.74     4,053.72     5,283.46      -165.30         80.7         19.3        Never
5....................................  4.....................     1,269.24     4,036.62     5,305.85      -187.69         83.9         16.1        Never
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                  Subgroup: Owners of Transient-Prone Outdoor Lighting
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                       Baseline..............     1,077.60     4,044.53     5,122.13  ...........  ...........  ...........  ...........
1....................................  1.....................     1,116.64     3,998.77     5,115.41         6.72         44.2         55.8         19.9
2, 3.................................  2.....................     1,132.93     3,975.23     5,108.17        13.97         37.6         62.4         18.3
4....................................  3.....................     1,229.80     4,159.95     5,389.75      -267.62         96.3          3.7        Never
5....................................  4.....................     1,269.31     4,150.29     5,419.60      -297.47         97.3          2.7        Never
--------------------------------------------------------------------------------------------------------------------------------------------------------

[[Page 7813]]

                           Table VII.26--Equipment Class 5--1000 Watt Metal Halide Lamp Fixtures (Indoor): LCC and PBP Results
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                       Life-cycle cost 2012$                 Life-cycle cost savings
                                                              ------------------------------------------------------------------------------    Median
                                                                                                                     Percent of customers      payback
       Trial standard level              Efficiency level       Installed    Discounted                 Average         that experience         period
                                                                   cost      operating       LCC        savings   --------------------------    years
                                                                                cost                     2012$       Net cost   Net benefit
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                   Subgroup: Utilities
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                    Baseline.................       760.82     1,091.41     1,852.22  ...........  ...........  ...........  ...........
                                    Baseline+DS*.............  ...........  ...........  ...........  ...........  ...........  ...........  ...........
                                    Baseline+DS**............       810.09     1,258.76     2,068.85      -216.63        100.0          0.0          N/A
                                    EL1......................       816.76     1,119.70     1,936.46       -84.23        100.0          0.0        Never
                                    EL1+DS*..................       801.78       720.57     1,522.35       329.87          4.0         96.0          1.5
                                    EL1+DS**.................       866.04     1,287.05     2,153.09      -300.86        100.0          0.0        Never
                                    EL2......................       837.81     1,130.34     1,968.16      -115.93        100.0          0.0        Never
1, 2, 3, 4, 5.....................  EL2+DS*..................       831.04       735.29     1,566.33       285.90          4.1         95.9          2.7
1, 2, 3, 4, 5.....................  EL2+DS**.................       887.09     1,297.70     2,184.79      -332.57        100.0          0.0        Never
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                        Subgroup: Transportation Facility Owners
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                    Baseline.................       760.82     9,226.73     9,987.55  ...........  ...........  ...........  ...........
                                    Baseline+DS*.............  ...........  ...........  ...........  ...........  ...........  ...........  ...........
                                    Baseline+DS**............       810.09     9,426.57    10,236.67      -249.12        100.0          0.0          N/A
                                    EL1......................       816.76     9,153.37     9,970.13        17.41         34.0         66.0         13.7
                                    EL1+DS*..................       801.78     7,781.69     8,583.47     1,404.08          0.0        100.0          0.4
                                    EL1+DS**.................       866.04     9,353.22    10,219.25      -231.71         99.7          0.3        Never
                                    EL2......................       837.81     9,125.67     9,963.48        24.06         33.9         66.1         13.6
1, 2, 3, 4, 5.....................  EL2+DS*..................       831.04     7,726.91     8,557.95     1,429.60          0.0        100.0          0.7
1, 2, 3, 4, 5.....................  EL2+DS**.................       887.09     9,325.51    10,212.60      -225.06         99.6          0.4        Never
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                               Subgroup: Warehouse Owners
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                    Baseline.................       760.82     7,821.14     8,581.96  ...........  ...........  ...........  ...........
                                    Baseline+DS*.............  ...........  ...........  ...........  ...........  ...........  ...........  ...........
                                    Baseline+DS**............       810.09     7,990.69     8,800.78      -218.83        100.0          0.0          N/A
                                    EL1......................       816.76     7,755.53     8,572.29         9.66         45.6         54.4         15.4
                                    EL1+DS*..................       801.78     6,584.62     7,386.40     1,195.55          0.0        100.0          0.5
                                    EL1+DS**.................       866.04     7,925.08     8,791.12      -209.16         99.7          0.3        Never
                                    EL2......................       837.81     7,730.76     8,568.58        13.38         45.5         54.5         15.4
1, 2, 3, 4, 5.....................  EL2+DS*..................       831.04     6,536.33     7,367.37     1,214.59          0.0        100.0          0.8
1, 2, 3, 4, 5.....................  EL2+DS**.................       887.09     7,900.31     8,787.40      -205.45         99.6          0.4        Never
--------------------------------------------------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------------------------------------------------
* DS = Design Standard prohibits fixtures from containing a probe-start ballast. A percentage of customers in this equipment class will migrate to these
  fixtures, which are reduced-wattage 875 W systems.
** Design Standard 1000 W pulse-start fixtures. Customers who do not migrate to 875 W systems will choose these 1000 W systems.

                          Table VII.27--Equipment Class 5--1000 Watt Metal Halide Lamp Fixtures (Outdoor): LCC and PBP Results
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                       Life-cycle cost 2012$                 Life-cycle cost savings
                                                              ------------------------------------------------------------------------------    Median
                                                                                                                     Percent of customers      payback
       Trial standard level              Efficiency level       Installed    Discounted                 Average        that  experience         period
                                                                   cost      operating       LCC        savings   --------------------------    years
                                                                                cost                     2012$       Net cost   Net benefit
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                   Subgroup: Utilities
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                    Baseline.................     1,184.66     1,966.58     3,151.25  ...........  ...........  ...........  ...........
                                    Baseline+DS*.............  ...........  ...........  ...........  ...........  ...........  ...........  ...........
                                    Baseline+DS**............     1,240.01     2,251.71     3,491.72      -340.47        100.0          0.0          N/A
                                    EL1......................     1,238.24     1,995.40     3,233.63       -82.38        100.0          0.0        Never
                                    EL1+DS*..................     1,231.53     1,229.54     2,461.07       690.17          4.3         95.7          1.2
                                    EL1+DS**.................     1,293.58     2,280.52     3,574.10      -422.86        100.0          0.0        Never
                                    EL2......................     1,258.40     2,006.24     3,264.64      -113.39        100.0          0.0        Never
1, 2, 3, 4, 5.....................  EL2+DS*..................     1,259.55     1,244.54     2,504.08       647.16          5.4         94.6          2.1
1, 2, 3, 4, 5.....................  EL2+DS**.................     1,313.74     2,291.37     3,605.11      -453.86        100.0          0.0        Never
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                        Subgroup: Transportation Facility Owners
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                    Baseline.................     1,184.62     9,152.48    10,337.10  ...........  ...........  ...........  ...........
                                    Baseline+DS*.............  ...........  ...........  ...........  ...........  ...........  ...........  ...........
                                    Baseline+DS**............     1,239.95     9,435.92    10,675.88      -338.78        100.0          0.0          N/A
                                    EL1......................     1,238.18     9,081.54    10,319.72        17.37         30.4         69.6         17.0

[[Page 7814]]

 
                                    EL1+DS*..................     1,231.48     7,497.64     8,729.12     1,607.97          0.1         99.9          0.5
                                    EL1+DS**.................     1,293.52     9,364.98    10,658.50      -321.40         99.7          0.3        Never
                                    EL2......................     1,258.34     9,054.76    10,313.10        24.00         30.3         69.7         17.0
1, 2, 3, 4, 5.....................  EL2+DS*..................     1,259.49     7,445.67     8,705.16     1,631.94          1.6         98.4          0.8
1, 2, 3, 4, 5.....................  EL2+DS**.................     1,313.68     9,338.20    10,651.88      -314.78         99.7          0.3        Never
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                               Subgroup: Warehouse Owners
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                    Baseline.................     1,184.62     9,152.48    10,337.10  ...........  ...........  ...........  ...........
                                    Baseline+DS*.............  ...........  ...........  ...........  ...........  ...........  ...........  ...........
                                    Baseline+DS**............     1,239.95     9,435.92    10,675.88      -338.78        100.0          0.0          N/A
                                    EL1......................     1,238.18     9,081.54    10,319.72        17.37         30.4         69.6         17.0
                                    EL1+DS*..................     1,231.48     7,497.64     8,729.12     1,607.97          0.1         99.9          0.5
                                    EL1+DS**.................     1,293.52     9,364.98    10,658.50      -321.40         99.7          0.3        Never
                                    EL2......................     1,258.34     9,054.76    10,313.10        24.00         30.3         69.7         17.0
1, 2, 3, 4, 5.....................  EL2+DS*..................     1,259.49     7,445.67     8,705.16     1,631.94          1.6         98.4          0.8
1, 2, 3, 4, 5.....................  EL2+DS**.................     1,313.68     9,338.20    10,651.88      -314.78         99.7          0.3        Never
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                  Subgroup: Owners of Transient-Prone Outdoor Lighting
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                    Baseline.................     1,184.66     9,169.03    10,353.69  ...........  ...........  ...........  ...........
                                    Baseline+DS*.............  ...........  ...........  ...........  ...........  ...........  ...........  ...........
                                    Baseline+DS**............     1,240.01     9,454.15    10,694.16      -340.47        100.0          0.0          N/A
                                    EL1......................     1,238.24     9,097.27    10,335.50        18.19         29.8         70.2         16.9
                                    EL1+DS*..................     1,231.53     7,511.15     8,742.68     1,611.01          0.1         99.9          0.5
                                    EL1+DS**.................     1,293.58     9,382.40    10,675.98      -322.29         99.7          0.3        Never
                                    EL2......................     1,258.40     9,070.18    10,328.57        25.12         29.7         70.3         16.8
1, 2, 3, 4, 5.....................  EL2+DS*..................     1,259.55     7,458.67     8,718.22     1,635.47          1.8         98.2          0.8
1, 2, 3, 4, 5.....................  EL2+DS**.................     1,313.74     9,355.30    10,669.04      -315.35         99.7          0.3        Never
--------------------------------------------------------------------------------------------------------------------------------------------------------
* DS = Design Standard prohibits fixtures from containing a probe-start ballast. A percentage of customers in this equipment class will migrate to these
  fixtures, which are reduced-wattage 875 W systems.
** Design Standard 1000 W pulse-start fixtures. Customers who do not migrate to 875 W systems will choose these 1000 W systems.

c. Rebuttable Presumption Payback
    As discussed in section IV.D.2, EPCA establishes a rebuttable 
presumption that, in essence, an energy conservation standard is 
economically justified if the increased purchase cost for a product 
that meets the standard is less than three times the value of the 
first-year energy savings resulting from the standard. (42 U.S.C. 
6295(o)(2)(B)(iii)) DOE calculated a rebuttable presumption payback 
period for each TSL to determine whether DOE could presume that a 
standard at that level is economically justified. Table VII.28 shows 
the rebuttable-presumption payback periods for the fixture TSLs. 
Because only a single, average value is necessary for establishing the 
rebuttable-presumption payback period, rather than using distributions 
for input values, DOE used discrete values. As required by EPCA, DOE 
based the calculation on the assumptions in the DOE test procedures for 
microwave ovens. (42 U.S.C. 6295(o)(2)(B)(iii)) As a result, DOE 
calculated a single rebuttable presumption payback value, and not a 
distribution of payback periods, for each TSL.

Table VII.28--Fixture Efficiency Levels With a Rebuttable Payback Period
                        of Less Than Three Years
------------------------------------------------------------------------
                                                          Mean payback
        Equipment class            Efficiency level       period years
------------------------------------------------------------------------
70 W (indoor, magnetic          1....................                1.3
 baseline).
70 W (outdoor, magnetic         1....................                1.4
 baseline).
1000 W (indoor)...............  1 + DS*..............                0.4
                                2 + DS*..............                0.7
1000 W (outdoor)..............  1 + DS*..............                0.6
                                2 + DS*..............                1.0
------------------------------------------------------------------------
* DS = Design standard requiring that all fixtures shall not contain a
  probe-start ballast.

    All the fixture efficiency levels in the LCC and PBP results tables 
have rebuttable-presumption payback periods of less than 3 years. DOE 
believes that the rebuttable-presumption payback period criterion 
(i.e., a limited payback period) is not sufficient for determining 
economic justification. Therefore, DOE has considered a full range of 
impacts,

[[Page 7815]]

including those to consumers, manufacturers, the Nation, and the 
environment. Section IV of this rulemaking provides a complete 
discussion of how DOE considered the range of impacts to select the 
standards in today's final rule.
2. Economic Impacts on Manufacturers
    DOE performed an MIA to estimate the impact of new and amended 
energy conservation standards on manufacturers of MHLFs and ballasts. 
The section below describes the expected impacts on manufacturers at 
each TSL. Chapter 13 of this final rule TSD explains the analysis in 
further detail.
a. Industry Cash-Flow Analysis Results
    The tables below depict the financial impacts (represented by 
changes in INPV) of new and amended energy conservation standards on 
manufacturers as well as the conversion costs that DOE estimates 
manufacturers would incur at each TSL. DOE reports the impacts on 
manufacturers of MHLFs and ballasts separately. Within each industry, 
DOE presents the results for all equipment classes in one group because 
most equipment classes are generally made by the same manufacturers. To 
evaluate the range of cash-flow impacts on the MHLF and ballast 
industries, DOE modeled four different scenarios using different 
assumptions for markups and shipments that correspond to the range of 
anticipated market responses to new and amended standards. Each 
scenario results in a unique set of cash flows and corresponding INPV 
at each TSL.
    DOE presents two of these shipment and markup scenario combinations 
in the following section. These scenarios represent the upper and lower 
bounds of market responses that DOE anticipates could occur in the 
standards case. The INPV results presented refer to the difference in 
industry value between the base case and the standards case that result 
from the sum of discounted cash flows from the base year (2014) through 
the end of the analysis period. The cash-flow results presented refer 
to the difference in cash flow between the base case and the standards 
case in 2016, the year before compliance is required. This figure 
represents the size of the required conversion costs relative to the 
cash flow generated by the industry in the absence of new and amended 
energy conservation standards.
Cash-Flow Analysis Results by TSL for Metal Halide Ballasts
    To assess the upper (less severe) end of the range of potential 
impacts on MH ballast manufacturers, DOE modeled a flat markup 
scenario. The flat markup scenario assumes that in the standards case, 
manufacturers would be able to pass along all the higher production 
costs required for more efficient equipment to their customers. 
Specifically, the industry would be able to maintain its average base 
case gross margin, as a percentage of revenue, despite the higher 
production costs in the standards case. In general, the larger the 
equipment price increases, the less likely manufacturers are to achieve 
the cash flow from operations calculated in this scenario because it is 
less likely that manufacturers would be able to fully markup these 
larger cost increases.
    DOE also used the high-shipment scenario to assess the upper bound 
of impacts. Under the high-shipment scenario, base case shipments of 
MHLFs decrease at a slower rate over the analysis period compared to 
the low-shipment scenario. The combination of the flat markup and high-
shipment scenario provides the best conditions for cash flow generation 
than any other combination analyzed by DOE in the MIA. In this 
scenario, manufacturers experience higher annual shipment volumes and 
have the ability to preserve their base case gross margins. Thus, this 
combination of scenarios yields the greatest modeled industry 
profitability.
    To assess the lower (more severe) end of the range of potential 
impacts on the MH ballast industry, DOE modeled the preservation of 
operating profit markup scenario. This scenario represents the lower 
end of the range of potential impacts on manufacturers because no 
additional operating profit is earned on the higher production costs, 
eroding profit margins as a percentage of total revenue.
    DOE also used the low-shipment scenario to assess the lower bound 
of impacts. Under the low-shipment scenario, MHLF shipments decrease at 
a faster rate over the analysis period compared to the high-shipment 
scenario. The combination of the preservation of operating profit 
markup and low-shipment scenario most restricts manufacturers' ability 
to pass on costs to customers and assumes the lowest level of 
shipments. Thus, this combination of scenarios estimates the largest 
manufacturer impacts.

                      Table VII.29--Manufacturer Impact Analysis for Metal Halide Ballasts--Flat Markup and High-Shipment Scenario
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                  Trial standard level
                                                                Units                Base case ---------------------------------------------------------
                                                                                                    1          2           3           4           5
--------------------------------------------------------------------------------------------------------------------------------------------------------
INPV...........................................  (2012$ millions)..................         74         71         74        75          83          89
Change in INPV.................................  (2012$ millions)..................  .........      (3.1)      (0.4)         0.6         9.6        15.0
                                                 (%)...............................  .........       -4.2       -0.5         0.8        12.9        20.3
Product Conversion Costs.......................  (2012$ millions)..................  .........         11         12        12          16          20
Capital Conversion Costs.......................  (2012$ millions)..................  .........          9         10        11           4           5
                                                --------------------------------------------------------------------------------------------------------
    Total Conversion Costs.....................  (2012$ millions)..................  .........         21         22        23          21          24
--------------------------------------------------------------------------------------------------------------------------------------------------------

  Table VII.30--Manufacturer Impact Analysis for Metal Halide Ballasts--Preservation of Operating Profit Markup
                                            and Low-Shipment Scenario
----------------------------------------------------------------------------------------------------------------
                                                                            Trial standard level
                                    Units       Base case ------------------------------------------------------
                                                               1          2          3          4          5
----------------------------------------------------------------------------------------------------------------
INPV.........................  (2012$                  67         50         49         48         51         48
                                millions).
Change in INPV...............  (2012$           .........     (16.5)     (17.9)     (19.0)     (16.2)     (19.0)
                                millions).
                               (%)............  .........      -24.6      -26.7      -28.3      -24.1      -28.3

[[Page 7816]]

 
Product Conversion Costs.....  (2012$           .........         11         12         12         16         20
                                millions).
Capital Conversion Costs.....  (2012$           .........          9         10         11          4          5
                                millions).
                              ----------------------------------------------------------------------------------
    Total Conversion Costs...  (2012$           .........         21         22         23         21         24
                                millions).
----------------------------------------------------------------------------------------------------------------

    TSL 1 is baseline for two of the 12 equipment classes (1500 W 
indoor and outdoor), EL1 for eight of the 12 equipment classes (70 W 
indoor and outdoor, 150 W indoor and outdoor, 250 W indoor and outdoor, 
and 400 W indoor and outdoor), and EL2 for the remaining two equipment 
classes (1000 W indoor and outdoor). At TSL 1, DOE estimates impacts on 
INPV range from -$3.1 million to -$16.5 million, or a change in INPV of 
-4.2 percent to -24.6 percent. At TSL 1, industry free cash flow 
(operating cash flow minus capital expenditures) is estimated to 
decrease by approximately 105 percent to -$0.4 million, compared to the 
base case value of $7.2 million in 2016.
    Impacts on INPV range from slightly negative to moderately negative 
at TSL 1. TSL 1 requires the use of more efficient magnetic ballasts 
for the 70 W indoor and outdoor, 150 W indoor and outdoor, 250 W indoor 
and outdoor, 400 W indoor and outdoor, and 1000 W indoor and outdoor 
equipment classes. DOE projects that in 2017, 92 percent of 70 W indoor 
shipments, 13 percent of 150 W indoor shipments, 16 percent of 250 W 
indoor shipments, seven percent of 400 W indoor shipments, one percent 
of 1000 W indoor shipments, 100 percent of 1500 W indoor shipments, 40 
percent of 70 W outdoor shipments, two percent of 150 W outdoor 
shipments, 10 percent of 250 W outdoor shipments, one percent of 1000 W 
outdoor shipments, and 100 percent of 1500 W outdoor shipments would 
meet TSL 1 or higher in the base case. No shipments from the 400 W 
outdoor equipment class would meet TSL 1 or higher in the base case in 
2017.
    Conversion costs are expected to be moderate at TSL 1. DOE expects 
ballast manufacturers to incur $11 million in product conversion costs 
for model redesigns and testing and $9 million in capital conversion 
costs for equipment such as stamping dies to process more efficient 
steel cores.
    At TSL 1, the shipment-weighted average MPC increases by 29 percent 
relative to the base case MPC. Under the flat markup scenario, 
manufacturers are able to fully pass on this cost increase to customers 
under this scenario. Additionally, under the high-shipment scenario, 
shipments are 130 percent higher than shipments under the low-shipment 
scenario in the last year of the analysis period. Thus, manufacturers 
generate the most revenue under this combination (flat markup and high-
shipment) of scenarios. The fairly large $21 million in conversion 
costs estimated at TSL 1 outweigh the moderate MPC increase even when 
applied to the larger quantity of shipments of the high-shipment 
scenario, resulting in slightly negative INPV impacts at TSL 1 under 
the flat markup and high-shipment scenarios.
    Under the preservation of operating profit markup scenario, 
manufacturers earn the same operating profit as they would in the base 
case in 2018, however, manufacturers do not earn additional profit from 
their investments. In this scenario, the 29 percent MPC increase is 
outweighed by a lower average markup of 1.43 (compared to the flat 
markup scenario markup of 1.47) and $21 million in conversion costs, 
resulting in greater negative impacts at TSL 1. The low-shipment 
scenario exacerbates these impacts because the base case INPV (the 
figure against which the absolute change in INPV is compared) is 10 
percent lower than the base case INPV in the high-shipment scenario.
    TSL 2 is baseline for two of the 12 equipment classes (1500 W 
indoor and outdoor), EL1 for two of the 12 equipment classes (250 W 
indoor and outdoor), and EL2 for the remaining eight equipment classes 
(70 W indoor and outdoor, 150 W indoor and outdoor, 400 W indoor and 
outdoor, and 1000 W indoor and outdoor). At TSL 2, DOE estimates 
impacts on INPV to range from -$0.4 million to -$17.9 million, or a 
change in INPV of -0.5 percent to -26.7 percent. At this level, 
industry free cash flow is estimated to decrease by approximately 114 
percent to -$1.0 million, compared to the base case value of $7.2 
million in 2016.
    For several equipment classes TSL 2 is the highest efficiency level 
the engineering analysis assumes manufacturers can meet with magnetic 
ballasts. DOE projects that in 2017, 89 percent of 70 W indoor 
shipments, ten percent of 150 W indoor shipments, 16 percent of 250 W 
indoor shipments, seven percent of 400 W indoor shipments, one percent 
of 1000 W indoor shipments, 100 percent of 1500 W indoor shipments, 10 
percent of 250 W outdoor shipments, one percent of 1000 W outdoor 
shipments, and 100 percent of 1500 W outdoor shipments would meet TSL 2 
or higher in the base case. No shipments from the 70 W outdoor, 150 W 
outdoor, or 400 W outdoor equipment classes would meet TSL 2 or higher 
in the base case in 2017. At TSL 2, product conversion costs slightly 
rise to $12 million and capital conversion costs slightly rise to $10 
million as manufacturers need to purchase additional equipment and 
tooling to upgrade magnetic production lines.
    At TSL 2, the shipment-weighted average MPC increases 38 percent 
over the base case MPC. In flat markup scenario, INPV impacts are 
slightly negative because the $22 million in conversion costs outweigh 
the manufacturers' ability to pass on the higher equipment costs to 
customers. Under the preservation of operating profit markup scenario, 
the 38 percent MPC increase is outweighed by a lower average markup of 
1.42 and $22 million in conversion costs, resulting in negative INPV 
impacts at TSL 2.
    TSL 3 is baseline for two of the 12 equipment classes (1500 W 
indoor and outdoor) and EL2 for the remaining ten equipment classes (70 
W indoor and outdoor, 150 W indoor and outdoor, 250 W indoor and 
outdoor, 400 W indoor and outdoor, and 1000 W indoor and outdoor). At 
TSL 3, DOE estimates impacts on INPV to range from $0.6 million to -
$19.0 million, or a change in INPV of 0.8 percent to -28.3 percent. At 
this level, industry free cash flow is estimated to decrease by 
approximately 120 percent to -$1.5 million, compared to the base case 
value of $7.2 million in 2016.
    TSL 3 is the highest efficiency level the engineering analysis 
assumes

[[Page 7817]]

manufacturers can meet with magnetic ballasts for all equipment 
classes. DOE projects that in 2017, 89 percent of 70 W indoor 
shipments, ten percent of 150 W indoor shipments, 12 percent of 250 W 
indoor shipments, seven percent of 400 W indoor shipments, one percent 
of 1000 W indoor shipments, 100 percent of 1500 W indoor shipments, one 
percent of 1000 W outdoor shipments, and 100 percent of 1500 W outdoor 
shipments would meet TSL 3 or higher in the base case. No shipments 
from the 70 W outdoor, 150 W outdoor, 250 W outdoor, or 400 W outdoor 
equipment classes would meet TSL 3 or higher in 2016 in the base case 
in 2017. DOE expects product conversion costs to remain constant at $12 
million and capital conversion costs to increase slightly to $11 
million.
    At TSL 3 the shipment-weighted average MPC increases 42 percent 
over the base case MPC. In the flat markup scenario, the additional 
revenues earned from passing on these higher MPC costs outweigh the $23 
million in conversion costs and higher working capital requirements, 
resulting in slightly positive INPV impacts. Under the preservation of 
operating profit markup scenario, the 42 percent MPC increase is 
outweighed by a lower average markup of 1.41 and $23 million in 
conversion costs, resulting in INPV results remaining negative at TSL 
3.
    TSL 4 is EL1 for two equipment classes (1500 W indoor and outdoor), 
EL2 for two equipment classes (1000 W indoor and outdoor), and EL3 for 
the remaining eight equipment classes (70 W indoor and outdoor, 150 W 
indoor and outdoor, 250 W indoor and outdoor, and 400 W indoor and 
outdoor). At TSL 4, DOE estimates impacts on INPV to range from $9.6 
million to -$16.2 million, or a change in INPV of 12.9 percent to -24.1 
percent. At this level, industry free cash flow is estimated to 
decrease by approximately 94 percent to $0.5 million, compared to the 
base case value of $7.2 million in 2016.
    The technology changes from TSL 3 to TSL 4 are that manufacturers 
must now use now electronic ballasts for the 70 W indoor and outdoor, 
150 W indoor and outdoor, 250 W indoor and outdoor, and 400 W indoor 
and outdoor equipment classes at TSL 4. DOE projects that in 2017, 89 
percent of 70 W indoor shipments, 10 percent of 150 W indoor shipments, 
12 percent of 250 W indoor shipments, seven percent of 400 W indoor 
shipments, one percent of 1000 W indoor shipments, six percent of 1500 
W indoor shipments, one percent of 1000 W outdoor shipments, and four 
percent of 1500 W outdoor shipments would meet TSL 4 or higher in the 
base case. No shipments of the 70 W outdoor, 150 W outdoor, 250 W 
outdoor, or 400 W outdoor equipment classes would meet TSL 4 or higher 
in the base case in 2017. Total conversion costs decrease from $23 
million at TSL 3 to $21 million at TSL 4, because of the flexibility of 
electronic ballast production within the lighting manufacturing 
industry.
    At TSL 4, the shipment-weighted average MPC increases 63 percent 
over the base case MPC. In the flat markup scenario, the additional 
revenues earned from passing on these higher MPC costs outweigh the $21 
million in conversion costs, resulting in moderately positive impacts 
on INPV. Under the preservation of operating profit markup scenario, 
the MPC increase is outweighed by a lower average markup of 1.40 and 
$21 million in conversion costs, resulting in INPV results remaining 
negative at TSL 4.
    TSL 5 is EL2 for four of the 12 equipment classes (1000 W indoor 
and outdoor and 1500 W indoor and outdoor) and EL4 for the remaining 
eight equipment classes (70 W indoor and outdoor, 150 W indoor and 
outdoor, 250 W indoor and outdoor, and 400 W indoor and outdoor). At 
TSL 5, DOE estimates impacts on INPV to range from $15.0 million to -
$19.0 million, or a change in INPV of 20.3 percent to -28.3 percent. At 
this level, industry free cash flow is estimated to decrease by 
approximately 109 percent to -$0.6 million, compared to the base case 
value of $7.2 million in 2016.
    TSL 5 is max tech for all equipment classes. DOE projects that in 
2017, one percent of 70 W indoor shipments, one percent of 1000 W 
indoor shipments, and one percent of 1000 W outdoor shipments will meet 
TSL 5 in the base case. No shipments of any of the other equipment 
classes will meet TSL 5 in the base case in 2017. As a result, product 
conversion costs increase to $24 million because of the need to 
redesign and test additional models. However, capital conversion costs 
remain fairly low at $5 million due to the flexibility of electronic 
ballast production.
    At TSL 5, the shipment-weighted average MPC increases 82 percent 
over the base case MPC. In the flat markup scenario the additional 
revenues earned from passing on these higher MPC costs outweigh the 
increased conversion costs of $24 million, resulting in a moderately 
positive impact on INPV. Under the preservation of operating profit 
markup scenario, the MPC increase is outweighed by a lower average 
markup of 1.39 and $24 million in conversion costs, resulting in INPV 
results remaining negative at TSL 5.
Cash Flow Analysis Results by TSL for Metal Halide Lamp Fixtures
    DOE incorporated the same scenarios to represent the upper and 
lower bounds of industry impacts for MHLFs as for MH ballasts: the flat 
markup scenario with the high-shipment scenario and the preservation of 
operating profit markup scenario with the low-shipment scenario. Note 
that the TSLs below represent the same sets of efficiency levels as 
discussed in the previous section in the description of impacts on MH 
ballast manufacturers.

                    Table VII.31--Manufacturer Impact Analysis for Metal Halide Lamp Fixtures--Flat Markup and High-Shipment Scenario
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                 Trial standard level
                                                              Units                Base case -----------------------------------------------------------
                                                                                                   1           2           3           4           5
--------------------------------------------------------------------------------------------------------------------------------------------------------
INPV..........................................  (2012$ millions).................        379       408         418         423         418         408
Change in INPV................................  (2012$ millions).................                   28.4        38.3        43.4        38.6        29.1
                                                (%)..............................                    7.5        10.1        11.4        10.2         7.7
Product Conversion Costs......................  (2012$ millions).................                    3           3           3          45          62
Capital Conversion Costs......................  (2012$ millions).................                    0           0           0          32          50
                                               ---------------------------------------------------------------------------------------------------------
    Total Conversion Costs....................  (2012$ millions).................                    3           3           3          77         112
--------------------------------------------------------------------------------------------------------------------------------------------------------

[[Page 7818]]

   Table VII.32--Manufacturer Impact Analysis for Metal Halide Lamp Fixtures--Preservation of Operating Profit
                                        Markup and Low-Shipment Scenario
----------------------------------------------------------------------------------------------------------------
                                                                            Trial standard level
                                    Units       Base case ------------------------------------------------------
                                                               1          2          3          4          5
----------------------------------------------------------------------------------------------------------------
INPV.........................  (2012$                 346        342        342        342        285        257
                                millions).
Change in INPV...............  (2012$                          (3.6)      (3.6)      (3.6)     (60.4)     (88.6)
                                millions).
                               (%)............                  -1.0       -1.0       -1.1      -17.5      -25.6
Product Conversion Costs.....  (2012$                              3          3          3         45         62
                                millions).
Capital Conversion Costs.....  (2012$                              0          0          0         32         50
                                millions).
                              ----------------------------------------------------------------------------------
    Total Conversion Costs...  (2012$                              3          3          3         77        112
                                millions).
----------------------------------------------------------------------------------------------------------------

    At TSL 1, DOE estimates impacts on INPV to range from $28.4 million 
to -$3.6 million, or a change in INPV of 7.5 percent to -1.0 percent. 
At TSL 1, industry free cash flow is estimated to decrease by 
approximately 3 percent to $38.3 million, compared to the base case 
value of $39.3 million in 2016.
    DOE expects minimal conversion costs for fixture manufacturers at 
TSL 1. Fixture manufacturers would incur $3 million in product 
conversion costs for the testing of redesigned ballasts. Because the 
stack height of magnetic ballasts is not expected to change in response 
to the standards, fixture manufacturers would not incur any capital 
conversion costs at efficiency levels that can be met with magnetic 
ballast such as TSL 1.
    At TSL 1, the shipment-weighted average MPC increases by 11 percent 
from the base case MPC. In the flat markup scenario manufacturers 
maximize revenue since they are able to fully pass on this cost 
increase to customers. The slight price increase applied to a large 
quantity of shipments outweighs the impact of the $3 million in 
conversion costs for TSL 1, resulting in positive impacts at TSL 1 
under the flat markup and high-shipment scenarios.
    Under the preservation of operating profit markup scenario a lower 
average markup of 1.54 (compared to the flat manufacturer markup of 
1.58) and $3 million in conversion cost results in a slightly negative 
impacts at TSL 1. The low-shipment scenario exacerbates these impacts 
because the base case INPV (the figure against which the absolute 
change in INPV is compared) is 10 percent lower than the base case INPV 
in the high-shipment scenario.
    At TSL 2, DOE estimates impacts on INPV to range from $38.3 million 
to -$3.6 million, or a change in INPV of 10.1 percent to -1.0 percent. 
At this level, industry free cash flow is estimated to decrease by 
approximately 3 percent to $38.3 million, compared to the base case 
value of $39.3 million in 2016.
    At TSL 2, the shipment-weighted average MPC increases 15 percent 
over the base case MPC. In the flat markup scenario the additional 
revenues earned from passing on these higher MPC costs outweigh the 
fairly low conversion costs of $3 million, resulting in a positive 
impact on INPV. Under the preservation of operating profit markup 
scenario, the MPC increase is outweighed by a lower average markup of 
1.53 and $3 million in conversion costs, resulting in slightly negative 
INPV results at TSL 2.
    At TSL 3, DOE estimates impacts on INPV to range from $43.4 million 
to -$3.6 million, or a change in INPV of 11.4 percent to -1.1 percent. 
At this level, industry free cash flow is estimated to decrease by 
approximately 3 percent to $38.3 million, compared to the base case 
value of $39.3 million in 2016. At TSL 3, the shipment-weighted average 
MPC increases 16 percent over the base case MPC. In the flat markup 
scenario the additional revenues earned from passing on these higher 
MPC costs outweigh the fairly low conversion costs of $3 million, 
resulting in a positive impact on INPV. Under the preservation of 
operating profit markup scenario, the MPC increase is outweighed by a 
lower average markup of 1.53 and $3 million in conversion costs, 
resulting in slightly negative INPV results at TSL 3.
    At TSL 4, DOE estimates impacts on INPV to range from $38.6 million 
to -$60.4 million, or a change in INPV of 10.2 percent to -17.5 
percent. At this level, industry free cash flow is estimated to 
decrease by approximately 72 percent to $10.9 million, compared to the 
base case value of $39.3 million in 2016.
    The technology changes from TSL 3 to TSL 4 are that manufacturers 
must use electronic ballasts to meet the required efficiencies for the 
70 W indoor and outdoor, 150 W indoor and outdoor, 250 W indoor and 
outdoor, and 400 W indoor and outdoor equipment classes at TSL 4. This 
increases the product conversion costs from $3 million at TSL 3 to $45 
million at TSL 4 and increases the capital conversion costs from zero 
at TSL 3 to $32 million at TSL 4.
    At TSL 4, the shipment-weighted average MPC increases 44 percent 
over the base case MPC. In the flat markup scenario the additional 
revenue earned from passing on these higher MPC costs outweigh the 
increased conversion costs of $77 million, resulting in a positive 
impact on INPV at TSL 4. Under the preservation of operating profit 
markup scenario the MPC increase is outweighed by a lower average 
markup of 1.48 and $77 million in conversion costs, resulting in 
moderately negative INPV impacts at TSL 4.
    At TSL 5, DOE estimates impacts on INPV to range from $29.1 million 
to -$88.6 million, or a change in INPV of 7.7 percent to -25.6 percent. 
At this level, industry free cash flow is estimated to decrease by 
approximately 107 percent to -$2.8 million, compared to the base case 
value of $39.3 million in 2016.
    At TSL 5, product conversion costs again significantly increase to 
$62 million as manufacturers must redesign all equipment classes to 
accommodate the most efficient electronic ballasts. Capital conversion 
costs also significantly increase to $50 million because of the need 
for additional equipment and tooling, such as new castings to 
incorporate thermal protection in the 70 W indoor and outdoor, 150 W 
indoor and outdoor, 250 W indoor and outdoor, and 400 W indoor and 
outdoor equipment classes.
    At TSL 5, the shipment-weighted average MPC increases 51 percent 
over the base case MPC. In the flat markup scenario the additional 
revenues earned from passing on these higher MPC costs outweigh the 
much larger conversion costs of $112 million, resulting in a positive 
impact on INPV. Under the preservation of operating profit markup 
scenario, the MPC increase is outweighed by a lower average markup of 
1.47 and $112 million in conversion

[[Page 7819]]

costs, resulting in significantly negative INPV impacts at TSL 5.
b. Impacts on Employment
    DOE quantitatively assessed the impacts of potential new and 
amended energy conservation standards on direct employment. DOE used 
the GRIM to estimate the domestic labor expenditures and number of 
domestic production workers in the base case and at each TSL from 2014 
to 2046. DOE used statistical data from the U.S. Census Bureau's 2009 
Annual Survey of Manufacturers (ASM), the results of the engineering 
analysis, and interviews with manufacturers to determine the inputs 
necessary to calculate industry-wide labor expenditures and domestic 
employment levels. Labor expenditures involved with the manufacture of 
the equipment is a function of the labor intensity of the equipment, 
the sales volume, and an assumption that wages remain fixed in real 
terms over time.
    In the GRIM, DOE used the labor content of the equipment and the 
manufacturing production costs to estimate the annual labor 
expenditures in the industry. DOE used Census data and interviews with 
manufacturers to estimate the portion of the total labor expenditures 
that is attributable to domestic labor.
    The production worker estimates in this section cover only workers 
up to the line-supervisor level who are directly involved in 
fabricating and assembling equipment within an OEM facility. Workers 
performing services that are closely associated with production 
operations, such as material handing with a forklift, are also included 
as production labor. DOE's estimates account for only production 
workers who manufacture the specific equipment covered by this 
rulemaking. For example, a worker on a fluorescent lamp ballast line 
would not be included with the estimate of the number of MHLF or MH 
ballast workers.
    The employment impacts shown in the tables below represent the 
potential production employment that could result following new and 
amended energy conservation standards. The upper bound of the results 
estimates the maximum change in the number of production workers that 
could occur after compliance with new and amended energy conservation 
standards when assuming that manufacturers continue to produce the same 
scope of covered equipment in the same production facilities. It also 
assumes that domestic production does not shift to lower labor-cost 
countries. Because there is a real risk of manufacturers evaluating 
sourcing decisions in response to new and amended energy conservation 
standards, the lower bound of the employment results includes the 
estimated total number of U.S. production workers in the industry who 
could lose their jobs if all existing production were moved outside of 
the United States. While the results present a range of employment 
impacts following 2017, the sections below also include qualitative 
discussions of the likelihood of negative employment impacts at the 
various TSLs. Finally, the employment impacts shown are independent of 
the employment impacts from the broader U.S. economy, which are 
documented in chapter 14 of this final rule TSD.
Employment Impacts for Metal Halide Ballasts
    Based on 2009 ASM data and interviews with manufacturers, DOE 
estimates that less than 30 domestic production workers would be 
involved in manufacturing MH ballasts in 2017, as the vast majority of 
MH ballasts are manufactured abroad. DOE's view is that manufacturers 
could face moderate positive impacts on domestic employment levels 
because increasing equipment costs at each TSL would result in higher 
labor expenditures per unit, causing manufacturers to hire more workers 
to meet demand for MH ballasts, assuming that production remains in 
domestic facilities. Many manufacturers, however, do not expect a 
significant change in total employment at their facilities. Although 
manufacturers are concerned that higher prices for MH ballasts will 
drive customers to alternate technologies, most manufacturers offer 
these alternate technologies and can shift their employees from MH 
ballast production to production of other technologies in their 
facilities. Most manufacturers believe that domestic employment will 
only be significantly adversely affected if customers shift to foreign 
imports, causing the total lighting market share of the major domestic 
manufacturers to decrease.
Employment Impacts for Metal Halide Lamp Fixtures
    Using 2009 ASM data and interviews with manufacturers, DOE 
estimates that approximately 60 percent of the MHLFs sold in the United 
States are manufactured domestically. With this assumption, DOE 
estimates that in the absence of new and amended energy conservation 
standards, there would be approximately 340 domestic production workers 
involved in manufacturing MHLFs in 2017. Table VII.33 and Table VII.34 
show the range of the impacts of potential new and amended energy 
conservation standards on U.S. production workers in the MHLF industry.

                  Table VII.33--Potential Changes in the Total Number of Domestic Metal Halide Lamp Fixture Production Workers in 2017
                                                        [Flat markup and high-shipment scenario]
--------------------------------------------------------------------------------------------------------------------------------------------------------
 
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                Base case                                              Trial standard level
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                 1               2               3               4               5
--------------------------------------------------------------------------------------------------------------------------------------------------------
Total Number of Domestic Production Workers in 2017                  345             393             408             415             419             440
 (without changes in production locations)..............
Potential Changes in Domestic Production Workers in 2017  ..............        48-(345)        63-(345)        70-(345)        74-(345)        95-(345)
 *......................................................
--------------------------------------------------------------------------------------------------------------------------------------------------------
* DOE presents a range of potential employment impacts. Numbers in parentheses indicate negative numbers.

[[Page 7820]]

                  Table VII.34--Potential Changes in the Total Number of Domestic Metal Halide Lamp Fixture Production Workers in 2017
                                           [Preservation of operating profit markup and low-shipment scenario]
--------------------------------------------------------------------------------------------------------------------------------------------------------
 
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                Base case                                              Trial standard level
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                 1               2               3               4               5
--------------------------------------------------------------------------------------------------------------------------------------------------------
Total Number of Domestic Production Workers in 2017                  339             386             401             408             412             432
 (without changes in production locations)..............
Potential Changes in Domestic Production Workers in 2017  ..............        47-(339)        62-(339)        69-(339)        73-(339)        93-(339)
 *......................................................
--------------------------------------------------------------------------------------------------------------------------------------------------------

    At the upper end of the range, all examined TSLs show moderate 
positive impacts on domestic employment levels. The increasing 
equipment cost at each higher TSL would result in higher labor 
expenditures per unit, causing manufacturers to hire more workers to 
meet demand levels of MHLFs, assuming that production remains in 
domestic facilities. Many manufacturers, however, do not expect a 
significant change in total employment at their facilities. Although 
manufacturers are concerned that higher prices for MHLFs will drive 
customers to alternate technologies, most manufacturers offer these 
alternate technologies and can shift their employees from MHLF 
production to production of other technologies in their facilities. As 
with MH ballast manufacturers, most MHLF manufacturers believe that 
domestic employment will only be significantly adversely affected if 
customers shift to foreign imports, causing the total lighting market 
share of the major domestic manufacturers to decrease. Because of the 
potentially high cost of shipping MHLFs from overseas, many 
manufacturers believe that this shift is unlikely to occur, especially 
for the higher wattage MHLFs. This is particularly true for the 
significant portion of the market served by small manufacturers, for 
whom the per-unit shipping costs of sourcing products would be even 
greater because of the lower volumes that they sell.
    Based on the above, DOE does not expect the adopted energy 
conservation standards for MHLFs, at TSL 2, to have a significant 
negative impact on direct domestic employment levels. DOE notes that 
domestic employment levels could be negatively affected in the event 
that small fixture businesses choose to exit the market due to 
standards. However, discussions with small manufacturers indicated that 
most small businesses will be able to adapt to new and amended 
regulations at the adopted standards. The impacts on small businesses 
are discussed in section VIII.B.
c. Impacts on Manufacturing Capacity
    Both MHLF and ballast manufacturers stated that they do not 
anticipate any capacity constraints at efficiency levels that can be 
met with magnetic ballasts, which are the efficiency levels adopted for 
all equipment classes in today's final rule. If the production of 
higher-efficiency magnetic ballasts decreases the throughput on 
production lines, manufacturers stated that they would be able to add 
shifts on existing lines and maintain capacity.
    At efficiency levels that require electronic ballasts, however, 
manufacturers are concerned about the current worldwide shortage of 
electrical components. The components most affected by this shortage 
are high-efficiency parts, for which demand would increase even further 
following new and amended energy conservation standards. The increased 
demand could exacerbate the component shortage, thereby impacting 
manufacturing capacity in the near term, according to manufacturers. 
However, there are no equipment classes requiring electronic ballasts 
in today's final rule. Therefore, DOE does not anticipate a significant 
increase in demand for electric components due to today's energy 
conservation standards. While DOE recognizes that the premium component 
shortage is currently a significant issue for manufacturers, DOE views 
it as a relatively short-term phenomenon to which component suppliers 
will ultimately adjust. According to several manufacturers, suppliers 
have the ability to ramp up production to meet MH ballast component 
demand by the compliance date of new and amended standards, but those 
suppliers have hesitated to invest in additional capacity due to 
economic uncertainty and skepticism about the sustainability of demand. 
The state of the macroeconomic environment through 2017 will likely 
affect the duration of the premium component shortage. Mandatory 
standards, however, could create more certainty for suppliers about the 
eventual demand for these components. Additionally, the premium 
components at issue are not new technologies; rather, they have simply 
not historically been demanded in large quantities by MH ballast 
manufacturers.
d. Impacts on Subgroups of Manufacturers
    Using average cost assumptions to develop an industry cash-flow 
estimate may not be adequate for assessing differential impacts among 
manufacturer subgroups. Small manufacturers, niche equipment 
manufacturers, and manufacturers exhibiting cost structures 
substantially different from the industry average could be affected 
disproportionately. DOE analyzed the impacts to small businesses in 
section VIII.B and did not identify any other adversely impacted 
subgroups for MHLFs or ballasts for this rulemaking based on the 
results of the industry characterization.
e. Cumulative Regulatory Burden
    While any one regulation may not impose a significant burden on 
manufacturers, the combined effects of recent or impending regulations 
may have serious consequences for some manufacturers, groups of 
manufacturers, or an entire industry. Assessing the impact of a single 
regulation may overlook this cumulative regulatory burden. In addition 
to energy conservation standards, other regulations can significantly 
affect manufacturers' financial operations. Multiple regulations 
affecting the same manufacturer can strain profits and lead companies 
to abandon product lines or markets with lower expected future returns 
than competing products. For these reasons, DOE conducts an analysis of 
cumulative regulatory burden as part of its rulemakings pertaining to 
appliance efficiency.
    During previous stages of this rulemaking, DOE identified a number 
of requirements, in addition to new and

[[Page 7821]]

amended energy conservation standards for MHLFs, that manufacturers 
will face for products and equipment they manufacture approximately 
three years prior to and three years after the compliance date of the 
new and amended standards. The following section briefly addresses 
comments DOE received with respect to cumulative regulatory burden and 
summarizes other key related concerns that manufacturers raised during 
interviews and submitted comments.
    Several manufacturers expressed concern about the overall volume of 
DOE energy conservation standards with which they must comply. Most 
MHLF manufacturers also make a full range of lighting products and 
share engineering and other resources with these other internal 
manufacturing divisions for different products, including certification 
testing for regulatory compliance.
    DOE discusses these and other requirements in chapter 13 of this 
final rule TSD. DOE takes into account the cost of compliance with 
other published Federal energy conservation standards in weighing the 
benefits and burdens of today's rulemaking. DOE does not describe the 
quantitative impacts of standards that have not yet been finalized 
because any impacts would be speculative. DOE also notes that certain 
standards, such as ENERGY STAR, are optional for manufacturers.
3. National Impact Analysis
a. Significance of Energy Savings
    For each TSL, DOE projected energy savings for metal halide lamp 
fixtures purchased in the 30-year period that begins in the year 2017, 
ending in the year 2046. The savings are measured over the entire 
lifetime of equipment purchased in the 30-year period. DOE quantified 
the energy savings attributable to each TSL as the difference in energy 
consumption between each standards case and the base case. Table VII.35 
presents the estimated primary energy savings for each TSL for the low- 
and high-shipments scenarios, which represent the minimum and maximum 
energy savings resulting from all the scenarios analyzed. Table VII.36 
presents the estimated FFC energy savings for each considered TSL. 
Chapter 11 of the final rule TSD describes these estimates in more 
detail.

Table VII.35--Cumulative National Primary Energy Savings for Metal Halide Lamp Fixture Trial Standard Levels for
                                             Units Sold in 2017-2046
----------------------------------------------------------------------------------------------------------------
                                                                           National primary energy savings quads
                                                                         ---------------------------------------
           Trial standard level                    Equipment class           Low-shipments      High-shipments
                                                                               scenario            scenario
----------------------------------------------------------------------------------------------------------------
1.........................................  70 W........................                0.01                0.01
                                            150 W.......................                0.02                0.02
                                            250 W.......................                0.02                0.02
                                            400 W.......................                0.10                0.13
                                            1000 W......................                0.16                0.20
                                            1500 W......................                0.00                0.00
                                           ---------------------------------------------------------------------
                                               Total....................                0.30                0.38
----------------------------------------------------------------------------------------------------------------
2.........................................  70 W........................                0.02                0.02
                                            150 W.......................                0.04                0.05
                                            250 W.......................                0.02                0.02
                                            400 W.......................                0.15                0.19
                                            1000 W......................                0.16                0.20
                                            1500 W......................                0.00                0.00
                                           ---------------------------------------------------------------------
                                               Total....................                0.38                0.48
----------------------------------------------------------------------------------------------------------------
3.........................................  70 W........................                0.02                0.02
                                            150 W.......................                0.04                0.05
                                            250 W.......................                0.03                0.03
                                            400 W.......................                0.15                0.19
                                            1000 W......................                0.16                0.20
                                            1500 W......................                0.00                0.00
                                           ---------------------------------------------------------------------
                                               Total....................                0.39                0.49
----------------------------------------------------------------------------------------------------------------
4.........................................  70 W........................                0.07                0.09
                                            150 W.......................                0.10                0.12
                                            250 W.......................                0.11                0.14
                                            400 W.......................                0.25                0.31
                                            1000 W......................                0.16                0.20
                                            1500 W......................                0.00                0.00
                                           ---------------------------------------------------------------------
                                               Total....................                0.69                0.86
----------------------------------------------------------------------------------------------------------------
5.........................................  70 W........................                0.09                0.11
                                            150 W.......................                0.11                0.14
                                            250 W.......................                0.13                0.16
                                            400 W.......................                0.33                0.41
                                            1000 W......................                0.16                0.20
                                            1500 W......................                0.00                0.00
                                           ---------------------------------------------------------------------

[[Page 7822]]

 
                                               Total....................                0.81                1.02
----------------------------------------------------------------------------------------------------------------

  Table VII.36--Cumulative National Full-Fuel-Cycle Energy Savings for Metal Halide Lamp Fixture Trial Standard
                                       Levels for Units Sold in 2017-2046
----------------------------------------------------------------------------------------------------------------
                                                                             National FFC energy savings quads
                                                                         ---------------------------------------
           Trial standard level                    Equipment class           Low-shipments      High-shipments
                                                                               scenario            scenario
----------------------------------------------------------------------------------------------------------------
1.........................................  70 W........................                0.01                0.01
                                            150 W.......................                0.02                0.02
                                            250 W.......................                0.02                0.02
                                            400 W.......................                0.11                0.13
                                            1000 W......................                0.16                0.21
                                            1500 W......................                0.00                0.00
                                           ---------------------------------------------------------------------
                                               Total....................                0.31                0.39
----------------------------------------------------------------------------------------------------------------
2.........................................  70 W........................                0.02                0.02
                                            150 W.......................                0.04                0.05
                                            250 W.......................                0.02                0.02
                                            400 W.......................                0.16                0.20
                                            1000 W......................                0.16                0.21
                                            1500 W......................                0.00                0.00
                                           ---------------------------------------------------------------------
                                               Total....................                0.39                0.49
----------------------------------------------------------------------------------------------------------------
3.........................................  70 W........................                0.02                0.02
                                            150 W.......................                0.04                0.05
                                            250 W.......................                0.03                0.03
                                            400 W.......................                0.16                0.20
                                            1000 W......................                0.16                0.21
                                            1500 W......................                0.00                0.00
                                           ---------------------------------------------------------------------
                                               Total....................                0.40                0.50
----------------------------------------------------------------------------------------------------------------
4.........................................  70 W........................                0.08                0.09
                                            150 W.......................                0.10                0.13
                                            250 W.......................                0.12                0.14
                                            400 W.......................                0.25                0.32
                                            1000 W......................                0.16                0.21
                                            1500 W......................                0.00                0.00
                                           ---------------------------------------------------------------------
                                               Total....................                0.71                0.88
----------------------------------------------------------------------------------------------------------------
5.........................................  70 W........................                0.09                0.11
                                            150 W.......................                0.11                0.14
                                            250 W.......................                0.13                0.16
                                            400 W.......................                0.33                0.42
                                            1000 W......................                0.16                0.21
                                            1500 W......................                0.00                0.00
                                           ---------------------------------------------------------------------
                                               Total....................                0.83                1.03
----------------------------------------------------------------------------------------------------------------

    Circular A-4 requires agencies to present analytical results, 
including separate schedules of the monetized benefits and costs that 
show the type and timing of benefits and costs. Circular A-4 also 
directs agencies to consider the variability of key elements underlying 
the estimates of benefits and costs. For this rulemaking, DOE undertook 
a sensitivity analysis using nine rather than 30 years of fixture 
shipments. The choice of a 9-year period is a proxy for the timeline in 
EPCA for the review of certain energy conservation standards and 
potential revision of and compliance with such revised standards.\66\ 
DOE notes that the

[[Page 7823]]

review time frame established in EPCA generally does not overlap with 
the equipment lifetime, equipment manufacturing cycles or other factors 
specific to metal halide lamp fixtures. Thus, this information is 
presented for informational purposes only and is not indicative of any 
change in DOE's analytical methodology. The NES results based on a 9-
year analytical period are presented in Table VII.37. The impacts are 
counted over the lifetime of fixtures purchased in 2017-2025.
---------------------------------------------------------------------------

    \66\ EPCA requires DOE to review its standards at least once 
every 6 years, and requires, for certain products, a 3-year period 
after any new standard is promulgated before compliance is required, 
except that in no case may any new standards be required within 6 
years of the compliance date of the previous standards. While adding 
a 6-year review to the 3-year compliance period adds up to 9 years, 
DOE notes that it may undertake reviews at any time within the 6-
year period and that the 3-year compliance date may yield to the 6-
year backstop.

Table VII.37--Cumulative National Primary Energy Savings for Metal Halide Lamp Fixture Trial Standard Levels for
                                             Units Sold in 2017-2025
----------------------------------------------------------------------------------------------------------------
                                                                           National primary energy savings quads
                                                                         ---------------------------------------
           Trial standard level                    Equipment class           Low-shipments      High-shipments
                                                                               scenario            scenario
----------------------------------------------------------------------------------------------------------------
1.........................................  70 W........................                0.01                0.01
                                            150 W.......................                0.01                0.01
                                            250 W.......................                0.01                0.01
                                            400 W.......................                0.05                0.05
                                            1000 W......................                0.08                0.08
                                            1500 W......................                0.00                0.00
                                           ---------------------------------------------------------------------
                                               Total....................                0.15                0.16
----------------------------------------------------------------------------------------------------------------
2.........................................  70 W........................                0.01                0.01
                                            150 W.......................                0.02                0.02
                                            250 W.......................                0.01                0.01
                                            400 W.......................                0.07                0.07
                                            1000 W......................                0.08                0.08
                                            1500 W......................                0.00                0.00
                                           ---------------------------------------------------------------------
                                               Total....................                0.19                0.20
----------------------------------------------------------------------------------------------------------------
3.........................................  70 W........................                0.01                0.01
                                            150 W.......................                0.02                0.02
                                            250 W.......................                0.01                0.01
                                            400 W.......................                0.07                0.07
                                            1000 W......................                0.08                0.08
                                            1500 W......................                0.00                0.00
                                           ---------------------------------------------------------------------
                                               Total....................                0.19                0.20
----------------------------------------------------------------------------------------------------------------
4.........................................  70 W........................                0.04                0.05
                                            150 W.......................                0.05                0.05
                                            250 W.......................                0.06                0.06
                                            400 W.......................                0.11                0.12
                                            1000 W......................                0.08                0.08
                                            1500 W......................                0.00                0.00
                                           ---------------------------------------------------------------------
                                               Total....................                0.34                0.36
----------------------------------------------------------------------------------------------------------------
5.........................................  70 W........................                0.05                0.06
                                            150 W.......................                0.05                0.06
                                            250 W.......................                0.06                0.07
                                            400 W.......................                0.15                0.16
                                            1000 W......................                0.08                0.08
                                            1500 W......................                0.00                0.00
                                           ---------------------------------------------------------------------
                                               Total....................                0.39                0.42
----------------------------------------------------------------------------------------------------------------

b. Net Present Value of Customer Costs and Benefits
    DOE estimated the cumulative NPV of the total costs and savings for 
customers that would result from the TSLs considered for metal halide 
lamp fixtures. In accordance with OMB's guidelines on regulatory 
analysis,\67\ DOE calculated the NPV using both a 7-percent and a 3-
percent real discount rate. The 7-percent rate is an estimate of the 
average before-tax rate of return on private capital in the U.S. 
economy, and reflects the returns on real estate and small business 
capital as well as corporate capital. This discount rate approximates 
the opportunity cost of capital in the private sector (OMB analysis has 
found the average rate of return on capital to be near this rate). The 
3-percent rate reflects the potential effects of standards on private 
consumption (e.g., through higher prices for products and reduced 
purchases of energy). This rate represents the rate at which society 
discounts future consumption flows to their present

[[Page 7824]]

value. It can be approximated by the real rate of return on long-term 
government debt (i.e., yield on United States Treasury notes), which 
has averaged about 3 percent for the past 30 years.
---------------------------------------------------------------------------

    \67\ OMB Circular A-4, section E (Sept. 17, 2003). Available at: 
www.whitehouse.gov/omb/circulars_a004_a-4.
---------------------------------------------------------------------------

    Table VII.38 shows the customer NPV results for each TSL DOE 
considered for metal halide lamp fixtures, using both 7-percent and 3-
percent discount rates. In each case, the impacts cover the lifetime of 
equipment purchased in 2017-2046. See chapter 11 of the final rule TSD 
for more detailed NPV results.

          Table VII.38--Net Present Value of Customer Benefits for Metal Halide Lamp Fixture Trial Standard Levels for Units Sold in 2017-2046
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                  Net present value billion 2012$
                                                                         -------------------------------------------------------------------------------
                                                                                  Low-shipments scenario                  High-shipments scenario
           Trial standard level                    Equipment class       -------------------------------------------------------------------------------
                                                                          7-percent discount  3-percent discount  7-percent discount  3-percent discount
                                                                                 rate                rate                rate                rate
--------------------------------------------------------------------------------------------------------------------------------------------------------
1.........................................  70 W........................               0.018               0.033               0.019               0.035
                                            150 W.......................               0.031               0.074               0.035               0.089
                                            250 W.......................               0.007               0.045               0.009               0.053
                                            400 W.......................               0.004               0.102               0.008               0.134
                                            1000 W......................               0.198               0.528               0.234               0.656
                                            1500 W......................               0.000               0.000               0.000               0.000
                                           -------------------------------------------------------------------------------------------------------------
                                               Total....................               0.257               0.783               0.304               0.968
--------------------------------------------------------------------------------------------------------------------------------------------------------
2.........................................  70 W........................               0.016               0.041               0.017               0.044
                                            150 W.......................               0.046               0.119               0.054               0.144
                                            250 W.......................               0.007               0.045               0.009               0.053
                                            400 W.......................               0.022               0.183               0.030               0.236
                                            1000 W......................               0.198               0.528               0.234               0.656
                                            1500 W......................               0.000               0.000               0.000               0.000
                                           -------------------------------------------------------------------------------------------------------------
                                               Total....................               0.289               0.915               0.343               1.134
--------------------------------------------------------------------------------------------------------------------------------------------------------
3.........................................  70 W........................               0.016               0.041               0.017               0.044
                                            150 W.......................               0.046               0.119               0.054               0.144
                                            250 W.......................              -0.014               0.026              -0.015               0.033
                                            400 W.......................               0.022               0.183               0.030               0.236
                                            1000 W......................               0.198               0.528               0.234               0.656
                                            1500 W......................               0.000               0.000               0.000               0.000
                                           -------------------------------------------------------------------------------------------------------------
                                               Total....................               0.267               0.896               0.319               1.114
--------------------------------------------------------------------------------------------------------------------------------------------------------
4.........................................  70 W........................              -0.091              -0.118              -0.102              -0.135
                                            150 W.......................               0.074               0.218               0.087               0.269
                                            250 W.......................              -0.352              -0.606              -0.401              -0.721
                                            400 W.......................              -0.636              -1.057              -0.722              -1.244
                                            1000 W......................               0.198               0.528               0.234               0.656
                                            1500 W......................              -0.005              -0.007              -0.005              -0.008
                                           -------------------------------------------------------------------------------------------------------------
                                               Total....................              -0.812              -1.042              -0.910              -1.183
--------------------------------------------------------------------------------------------------------------------------------------------------------
5.........................................  70 W........................              -0.114              -0.146              -0.128              -0.166
                                            150 W.......................               0.049               0.177               0.059               0.221
                                            250 W.......................              -0.283              -0.460              -0.321              -0.543
                                            400 W.......................              -0.741              -1.201              -0.839              -1.409
                                            1000 W......................               0.198               0.528               0.234               0.656
                                            1500 W......................              -0.007              -0.010              -0.008              -0.012
                                           -------------------------------------------------------------------------------------------------------------
                                               Total....................              -0.898              -1.111              -1.004              -1.252
--------------------------------------------------------------------------------------------------------------------------------------------------------

    The NPV results based on the aforementioned 9-year analytical 
period are presented in Table VII.39. The impacts are counted over the 
lifetime of fixtures purchased in 2017-2025. As mentioned previously, 
this information is presented for informational purposes only and is 
not indicative of any change in DOE's analytical methodology or 
decision criteria.

[[Page 7825]]

          Table VII.39--Net Present Value of Customer Benefits for Metal Halide Lamp Fixture Trial Standard Levels for Units Sold in 2017-2025
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                  Net present value billion 2012$
                                                                         -------------------------------------------------------------------------------
                                                                                  Low-shipments scenario                  High-shipments scenario
           Trial standard level                    Equipment class       -------------------------------------------------------------------------------
                                                                          7-percent discount  3-percent discount  7-percent discount  3-percent discount
                                                                                 rate                rate                rate                rate
--------------------------------------------------------------------------------------------------------------------------------------------------------
1.........................................  70 W........................               0.018               0.033               0.019               0.035
                                            150 W.......................               0.021               0.043               0.022               0.046
                                            250 W.......................               0.003               0.025               0.004               0.026
                                            400 W.......................              -0.004               0.038              -0.004               0.041
                                            1000 W......................               0.122               0.269               0.131               0.289
                                            1500 W......................               0.000               0.000               0.000               0.000
                                           -------------------------------------------------------------------------------------------------------------
                                               Total....................               0.160               0.408               0.171               0.436
--------------------------------------------------------------------------------------------------------------------------------------------------------
2.........................................  70 W........................               0.016               0.037               0.017               0.039
                                            150 W.......................               0.030               0.065               0.032               0.070
                                            250 W.......................               0.003               0.025               0.004               0.026
                                            400 W.......................               0.005               0.074               0.005               0.079
                                            1000 W......................               0.122               0.269               0.131               0.289
                                            1500 W......................               0.000               0.000               0.000               0.000
                                           -------------------------------------------------------------------------------------------------------------
                                               Total....................               0.177               0.470               0.189               0.502
--------------------------------------------------------------------------------------------------------------------------------------------------------
3.........................................  70 W........................               0.016               0.037               0.017               0.039
                                            150 W.......................               0.030               0.065               0.032               0.070
                                            250 W.......................              -0.013               0.009              -0.013               0.010
                                            400 W.......................               0.005               0.074               0.005               0.079
                                            1000 W......................               0.122               0.269               0.131               0.289
                                            1500 W......................               0.000               0.000               0.000               0.000
                                           -------------------------------------------------------------------------------------------------------------
                                               Total....................               0.161               0.455               0.172               0.486
--------------------------------------------------------------------------------------------------------------------------------------------------------
4.........................................  70 W........................              -0.064              -0.072              -0.068              -0.077
                                            150 W.......................               0.046               0.112               0.049               0.120
                                            250 W.......................              -0.241              -0.353              -0.253              -0.373
                                            400 W.......................              -0.440              -0.635              -0.462              -0.669
                                            1000 W......................               0.122               0.269               0.131               0.289
                                            1500 W......................              -0.003              -0.004              -0.003              -0.004
                                           -------------------------------------------------------------------------------------------------------------
                                               Total....................              -0.580              -0.683              -0.607              -0.714
--------------------------------------------------------------------------------------------------------------------------------------------------------
5.........................................  70 W........................              -0.081              -0.092              -0.087              -0.099
                                            150 W.......................               0.029               0.088               0.031               0.094
                                            250 W.......................              -0.196              -0.274              -0.206              -0.289
                                            400 W.......................              -0.514              -0.729              -0.540              -0.768
                                            1000 W......................               0.122               0.269               0.131               0.289
                                            1500 W......................              -0.005              -0.006              -0.005              -0.006
                                           -------------------------------------------------------------------------------------------------------------
                                               Total....................              -0.645              -0.744              -0.676              -0.779
--------------------------------------------------------------------------------------------------------------------------------------------------------

    Finally, DOE evaluated the NPV results for both indoor and outdoor 
fixtures for each equipment class. Table VII.40 gives the NPV 
associated with each equipment class broken down into indoor and 
outdoor fixture environments.

          Table VII.40--Net Present Value of Customer Benefits for Metal Halide Lamp Fixture Trial Standard Levels for Units Sold in 2017-2046
                                                         [Low shipments, by fixture environment]
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                  Net present value billion 2012$
                                                                         -------------------------------------------------------------------------------
                                                                                      Indoor fixtures                        Outdoor fixtures
           Trial standard level                    Equipment class       -------------------------------------------------------------------------------
                                                                          7-percent discount  3-percent discount  7-percent discount  3-percent discount
                                                                                 rate                rate                rate                rate
--------------------------------------------------------------------------------------------------------------------------------------------------------
1.........................................  70 W........................               0.001               0.001               0.017               0.033
                                            150 W.......................               0.008               0.019               0.023               0.056

[[Page 7826]]

 
                                            250 W.......................               0.003               0.014               0.004               0.031
                                            400 W.......................               0.002               0.028               0.001               0.075
                                            1000 W......................               0.054               0.136               0.143               0.393
                                            1500 W......................               0.000               0.000               0.000               0.000
                                           -------------------------------------------------------------------------------------------------------------
                                               Total....................               0.068               0.197               0.189               0.586
--------------------------------------------------------------------------------------------------------------------------------------------------------
2.........................................  70 W........................               0.000               0.001               0.016               0.040
                                            150 W.......................               0.022               0.051               0.024               0.068
                                            250 W.......................               0.003               0.014               0.004               0.031
                                            400 W.......................               0.008               0.049               0.014               0.134
                                            1000 W......................               0.054               0.136               0.143               0.393
                                            1500 W......................               0.000               0.000               0.000               0.000
                                           -------------------------------------------------------------------------------------------------------------
                                               Total....................               0.087               0.251               0.201               0.664
--------------------------------------------------------------------------------------------------------------------------------------------------------
3.........................................  70 W........................               0.000               0.001               0.016               0.040
                                            150 W.......................               0.022               0.051               0.024               0.068
                                            250 W.......................              -0.002               0.010              -0.012               0.016
                                            400 W.......................               0.008               0.049               0.014               0.134
                                            1000 W......................               0.054               0.136               0.143               0.393
                                            1500 W......................               0.000               0.000               0.000               0.000
                                           -------------------------------------------------------------------------------------------------------------
                                               Total....................               0.082               0.247               0.185               0.650
--------------------------------------------------------------------------------------------------------------------------------------------------------
4.........................................  70 W........................               0.001               0.002              -0.092              -0.119
                                            150 W.......................               0.036               0.080               0.038               0.137
                                            250 W.......................              -0.050              -0.082              -0.302              -0.524
                                            400 W.......................              -0.121              -0.192              -0.515              -0.865
                                            1000 W......................               0.054               0.136               0.143               0.393
                                            1500 W......................              -0.001              -0.002              -0.003              -0.005
                                           -------------------------------------------------------------------------------------------------------------
                                               Total....................              -0.081              -0.059              -0.731              -0.983
--------------------------------------------------------------------------------------------------------------------------------------------------------
5.........................................  70 W........................              -0.004              -0.003              -0.110              -0.142
                                            150 W.......................               0.029               0.069               0.020               0.108
                                            250 W.......................              -0.030              -0.041              -0.253              -0.419
                                            400 W.......................              -0.151              -0.234              -0.589              -0.967
                                            1000 W......................               0.054               0.136               0.143               0.393
                                            1500 W......................              -0.002              -0.002              -0.005              -0.007
                                           -------------------------------------------------------------------------------------------------------------
                                               Total....................              -0.103              -0.075              -0.794              -1.035
--------------------------------------------------------------------------------------------------------------------------------------------------------

c. Impacts on Employment
    DOE estimated the indirect employment impacts of potential 
standards on the economy in general, assuming that energy conservation 
standards for metal halide lamp fixtures will reduce energy bills for 
fixture users and that the resulting net savings will be redirected to 
other forms of economic activity. DOE used an input/output model of the 
U.S. economy to estimate these effects, including the demand for labor 
as described in section V.J.
    The input/output model results suggest that today's adopted 
standards are likely to increase the net labor demand. The gains, 
however, would most likely be small relative to total national 
employment, and neither the BLS data nor the input/output model DOE 
uses includes the quality or wage level of the jobs. As shown in Table 
VII.41, DOE estimates that net indirect employment impacts from adopted 
fixture standards are small relative to the national economy.

              Table VII.41--Net Change in Jobs From Indirect Employment Effects Under Fixture TSLs
----------------------------------------------------------------------------------------------------------------
                                                                                Net national change in jobs
                                                                         ---------------------------------------
           Analysis period year                 Trial standard level         Low shipments      High shipments
                                                                           scenario, roll-up   scenario, roll-up
----------------------------------------------------------------------------------------------------------------
2018......................................  1...........................                 -60                 150
                                            2...........................                 -85                 260

[[Page 7827]]

 
                                            3...........................                -105                 405
                                            4...........................                -405                 820
                                            5...........................                -470                 705
2022......................................  1...........................                 135                 650
                                            2...........................                 170                 945
                                            3...........................                 155               1,300
                                            4...........................                  65               2,755
                                            5...........................                  80               2,655
----------------------------------------------------------------------------------------------------------------

4. Impact on Utility or Performance of Equipment
    As presented in section V.B of this notice, DOE concluded that none 
of the TSLs that were analyzed would reduce the utility or performance 
of the MHLFs under consideration in this rulemaking. Furthermore, 
manufacturers currently offer ballasts that meet or exceed the adopted 
standards in all equipment classes. (42 U.S.C. 6295(o)(2)(B)(i)(IV))
5. Impact of Any Lessening of Competition
    EPCA directs DOE to consider any lessening of competition that is 
likely to result from standards. It also directs the Attorney General 
of the United States (Attorney General) to determine the impact, if 
any, of any lessening of competition likely to result from a proposed 
standard and to transmit such determination to the Secretary within 60 
days of the publication of a proposed rule, together with an analysis 
of the nature and extent of the impact. (42 U.S.C. 6295(o)(2)(B)(i)(V) 
and (B)(ii)). To assist the Attorney General in making a determination 
for MHLF standards, DOE provided the Department of Justice (DOJ) with 
copies of the NOPR and the TSD for review. DOE received comments from 
DOJ stating the proposed energy conservation standards for MHLFs are 
unlikely to have a significant adverse impact on competition.
6. Need of the Nation To Conserve Energy
    An improvement in the energy efficiency of the products subject to 
today's rule is likely to improve the security of the nation's energy 
system by reducing overall demand for energy. Reduced electricity 
demand may also improve the reliability of the electricity system. 
Reductions in national electric generating capacity estimated for each 
considered TSL are reported in chapter 14 of the final rule TSD.
    Energy savings from new and amended energy conservation standards 
for fixtures could produce environmental benefits in the form of 
reduced emissions of air pollutants and GHGs associated with 
electricity production. Table VII.42 and Table VII.43 provide DOE's 
estimate of cumulative emissions reductions projected to result from 
the TSLs considered in this rulemaking, for the low and high shipment 
scenarios, respectively. The tables include both power sector emissions 
and upstream emissions. The upstream emissions were calculated using 
the multipliers discussed in section V.L. DOE reports annual emissions 
reductions for each TSL in the emissions analysis in chapter 16 the 
final rule TSD.

       Table VII.42--Cumulative Emissions Reduction for Potential Standards for Metal Halide Lamp Fixtures
                                            [Low shipments scenario]
----------------------------------------------------------------------------------------------------------------
                                                               Trial standard level
                                 -------------------------------------------------------------------------------
                                         1               2               3               4               5
----------------------------------------------------------------------------------------------------------------
                                             Power Sector Emissions
----------------------------------------------------------------------------------------------------------------
CO2 (million metric tons).......          16.80           21.24           21.80           38.30           44.93
NOX (thousand tons).............           8.85           11.18           11.48           20.16           23.64
Hg (tons).......................           0.04            0.05            0.05            0.08            0.10
N2O (thousand tons).............           0.36            0.45            0.46            0.81            0.95
CH4 (thousand tons).............           2.04            2.59            2.65            4.66            5.47
SO2 (thousand tons).............          29.48           37.29           38.26           67.25           78.95
----------------------------------------------------------------------------------------------------------------
                                               Upstream Emissions
----------------------------------------------------------------------------------------------------------------
CO2 (million metric tons).......           0.98            1.24            1.27            2.23            2.62
NOX (thousand tons).............          13.45           17.01           17.45           30.68           36.00
Hg (tons).......................           0.001           0.001           0.001           0.001           0.001
N2O (thousand tons).............           0.01            0.01            0.01            0.02            0.03
CH4 (thousand tons).............          81.69          103.31          106.01          186.34          218.69
SO2 (thousand tons).............           0.21            0.27            0.27            0.48            0.56
----------------------------------------------------------------------------------------------------------------
                                                 Total Emissions
----------------------------------------------------------------------------------------------------------------
CO2 (million metric tons).......          17.78           22.48           23.07           40.53           47.54
NOX (thousand tons).............          22.29           28.19           28.93           50.84           59.64
Hg (tons).......................           0.04            0.05            0.05            0.08            0.10
N2O (thousand tons).............           0.37            0.46            0.47            0.83            0.98

[[Page 7828]]

 
CH4 (thousand tons).............          83.74          105.90          108.66          191.01          224.16
SO2 (thousand tons).............          29.69           37.55           38.53           67.73           79.51
----------------------------------------------------------------------------------------------------------------

       Table VII.43--Cumulative Emissions Reduction for Potential Standards for Metal Halide Lamp Fixtures
                                            [High shipments scenario]
----------------------------------------------------------------------------------------------------------------
                                                               Trial standard level
                                 -------------------------------------------------------------------------------
                                         1               2               3               4               5
----------------------------------------------------------------------------------------------------------------
                                             Power Sector Emissions
----------------------------------------------------------------------------------------------------------------
CO2 (million metric tons).......          20.78           26.26           26.95           47.13           55.37
NOX (thousand tons).............          10.89           13.76           14.12           24.69           29.00
Hg (tons).......................           0.05            0.06            0.06            0.10            0.12
N2O (thousand tons).............           0.46            0.58            0.60            1.04            1.23
CH4 (thousand tons).............           2.57            3.25            3.33            5.83            6.85
SO2 (thousand tons).............          37.14           46.92           48.15           84.20           99.02
----------------------------------------------------------------------------------------------------------------
                                               Upstream Emissions
----------------------------------------------------------------------------------------------------------------
CO2 (million metric tons).......           1.22            1.54            1.59            2.77            3.26
NOX (thousand tons).............          16.83           21.26           21.81           38.16           44.85
Hg (tons).......................           0.001           0.001           0.001           0.001           0.002
N2O (thousand tons).............           0.01            0.02            0.02            0.03            0.03
CH4 (thousand tons).............         102.23          129.15          132.54          231.83          272.53
SO2 (thousand tons).............           0.26            0.33            0.34            0.59            0.70
----------------------------------------------------------------------------------------------------------------
                                                 Total Emissions
----------------------------------------------------------------------------------------------------------------
CO2 (million metric tons).......          22.01           27.80           28.53           49.90           58.63
NOX (thousand tons).............          27.72           35.02           35.93           62.85           73.86
Hg (tons).......................           0.05            0.06            0.06            0.10            0.12
N2O (thousand tons).............           0.47            0.60            0.61            1.07            1.26
CH4 (thousand tons).............         104.80          132.40          135.87          237.66          279.39
SO2 (thousand tons).............          37.40           47.25           48.49           84.80           99.72
----------------------------------------------------------------------------------------------------------------

    As discussed in section V.L, DOE did not report SO2 
emissions reductions from power plants because there is uncertainty 
about the effect of energy conservation standards on the overall level 
of SO2 emissions in the United States due to new emissions 
standards for power plants under the MATS rule. DOE also did not 
include NOX emissions reductions from power plants in states 
subject to CAIR because an energy conservation standard would not 
affect the overall level of NOX emissions in those states 
due to the emissions caps.
    As part the analysis for this final rule, DOE estimated monetary 
benefits likely to result from the reduced emissions of CO2 
and NOX that DOE estimated for each of the TSLs considered. 
As discussed in section V.M.1, DOE used values for the SCC developed by 
an interagency process. The interagency group selected four sets of SCC 
values for use in regulatory analyses. Three sets are based on the 
average SCC from three integrated assessment models, at discount rates 
of 2.5 percent, 3 percent, and 5 percent. The fourth set, 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. The four SCC values for CO2 emissions 
reductions in 2015, expressed in 2012$, are $11.8/ton, $39.7/ton, 
$61.2/ton, and $117.0/ton. These values for later years are higher due 
to increasing emissions-related costs as the magnitude of projected 
climate change increases.
    Table VII.44 and Table VII.45 present the global value of 
CO2 emissions reductions at each TSL for the low and high 
shipment scenarios, respectively. DOE calculated domestic values as a 
range from 7 percent to 23 percent of the global values, and these 
results are presented in chapter 17 of the final rule TSD.

[[Page 7829]]

   Table VII.44--Global Present Value of CO2 Emissions Reduction for Potential Standards for Metal Halide Lamp
                                                    Fixtures
                                            [Low shipments scenario]
----------------------------------------------------------------------------------------------------------------
                                                                          SCC scenario *
                                                 ---------------------------------------------------------------
                       TSL                                                                          3% discount
                                                    5% discount     3% discount    2.5% discount    rate, 95th
                                                   rate, average   rate, average   rate, average    percentile
----------------------------------------------------------------------------------------------------------------
                                                                           million 2012$
----------------------------------------------------------------------------------------------------------------
                                             Power Sector Emissions
----------------------------------------------------------------------------------------------------------------
1...............................................           109.3           509.9           813.4         1,574.7
2...............................................           138.2           644.8         1,028.7         1,991.6
3...............................................           141.8           661.8         1,055.7         2,043.9
4...............................................           249.2         1,162.7         1,854.8         3,591.3
5...............................................           291.9         1,362.9         2,174.5         4,209.8
----------------------------------------------------------------------------------------------------------------
                                               Upstream Emissions
----------------------------------------------------------------------------------------------------------------
1...............................................             6.2            29.3            46.8            90.6
2...............................................             7.9            37.1            59.2           114.6
3...............................................             8.1            38.0            60.8           117.6
4...............................................            14.2            66.9           106.9           206.8
5...............................................            16.6            78.4           125.3           242.5
----------------------------------------------------------------------------------------------------------------
                                                 Total Emissions
----------------------------------------------------------------------------------------------------------------
1...............................................             115           539.2           860.2         1,665.3
2...............................................             146           681.9         1,087.9         2,106.2
3...............................................             150           699.8         1,116.5         2,161.5
4...............................................             263         1,229.6         1,961.7         3,798.1
5...............................................             309         1,441.3         2,299.8         4,452.3
----------------------------------------------------------------------------------------------------------------
* For each of the four cases, the corresponding SCC value for emissions in 2015 is $11.8, $39.7, $61.2 and
  $117.0 per metric ton (2012$).

   Table VII.45--Global Present Value of CO2 Emissions Reduction for Potential Standards for Metal Halide Lamp
                                                    Fixtures
                                            [High shipments scenario]
----------------------------------------------------------------------------------------------------------------
                                                                          SCC scenario *
                                                 ---------------------------------------------------------------
                       TSL                                                                          3% discount
                                                    5% discount     3% discount    2.5% discount    rate, 95th
                                                   rate, average   rate, average   rate, average    percentile
----------------------------------------------------------------------------------------------------------------
                                                                           million 2012$
----------------------------------------------------------------------------------------------------------------
                                             Power Sector Emissions
----------------------------------------------------------------------------------------------------------------
1...............................................           130.4           617.9           988.6         1,909.5
2...............................................           164.8           780.8         1,249.3         2,413.0
3...............................................           169.1           801.4         1,282.2         2,476.6
4...............................................           296.0         1,402.5         2,243.7         4,334.3
5...............................................           347.3         1,646.3         2,634.1         5,088.0
----------------------------------------------------------------------------------------------------------------
                                               Upstream Emissions
----------------------------------------------------------------------------------------------------------------
1...............................................             7.5            35.9            57.6           111.1
2...............................................             9.5            45.4            72.7           140.4
3...............................................             9.7            46.6            74.7           144.1
4...............................................            17.0            81.5           130.7           252.2
5...............................................            20.0            95.7           153.5           296.2
----------------------------------------------------------------------------------------------------------------
                                                 Total Emissions
----------------------------------------------------------------------------------------------------------------
1...............................................           137.9           653.8         1,046.2         2,020.6
2...............................................           174.2           826.2         1,322.0         2,553.4
3...............................................           178.8           848.0         1,356.8         2,620.7
4...............................................           313.1         1,484.0         2,374.3         4,586.5
5...............................................           367.2         1,742.1         2,787.6         5,384.2
----------------------------------------------------------------------------------------------------------------
* For each of the four cases, the corresponding SCC value for emissions in 2015 is $11.8, $39.7, $61.2 and
  $117.0 per metric ton (2012$).

[[Page 7830]]

    DOE is well aware that scientific and economic knowledge about the 
contribution of CO2 and other GHG emissions to changes in 
the future global climate and the potential resulting damages to the 
world economy continues to evolve rapidly. Thus, any value placed in 
this rulemaking on reducing CO2 emissions is subject to 
change. DOE, together with other Federal agencies, will continue to 
review various methodologies for estimating the monetary value of 
reductions in CO2 and other GHG emissions. This ongoing 
review will consider the comments on this subject that are part of the 
public record for this and other rulemakings, as well as other 
methodological assumptions and issues. However, consistent with DOE's 
legal obligations, and taking into account the uncertainty involved 
with this particular issue, DOE has included in this NOPR the most 
recent values and analyses resulting from the ongoing interagency 
review process.
    DOE also estimated a range for the cumulative monetary value of the 
economic benefits associated with NOX and Hg emissions 
reductions anticipated to result from amended metal halide lamp fixture 
standards. Estimated monetary benefits for CO2 and 
NOX emission reductions are detailed in chapter 17 of the 
final rule TSD.
    The NPV of the monetized benefits associated with emissions 
reductions can be viewed as a complement to the NPV of the customer 
savings calculated for each TSL considered in this rulemaking. The 
dollar-per-ton values that DOE used are discussed in section V.M. Table 
VII.46 presents the present value of cumulative NOX 
emissions reductions for each TSL calculated using the average dollar-
per-ton values and 7-percent and 3-percent discount rates.

  Table VII.46--Present Value of NOX Emissions Reduction for Potential Standards for Metal Halide Lamp Fixtures
----------------------------------------------------------------------------------------------------------------
                                                      Low shipments scenario          High shipments scenario
                                                 ---------------------------------------------------------------
                       TSL                          3% discount     7% discount     3% discount     7% discount
                                                       rate            rate            rate            rate
----------------------------------------------------------------------------------------------------------------
                                                                           million 2012$
----------------------------------------------------------------------------------------------------------------
                                             Power Sector Emissions
----------------------------------------------------------------------------------------------------------------
1...............................................            12.0             5.8            14.1             6.6
2...............................................            15.2             7.4            17.9             8.3
3...............................................            15.6             7.6            18.3             8.5
4...............................................            27.4            13.3            32.1            14.9
5...............................................            32.0            15.5            37.6            17.5
----------------------------------------------------------------------------------------------------------------
                                               Upstream Emissions
----------------------------------------------------------------------------------------------------------------
1...............................................            17.4             7.9            20.8             9.1
2...............................................            22.0            10.0            26.3            11.4
3...............................................            22.6            10.2            27.0            11.7
4...............................................            39.7            18.0            47.3            20.6
5...............................................            46.5            21.0            55.5            24.1
----------------------------------------------------------------------------------------------------------------
                                                 Total Emissions
----------------------------------------------------------------------------------------------------------------
1...............................................            29.4            13.7            35.0            15.6
2...............................................            37.2            17.3            44.2            19.8
3...............................................            38.2            17.8            45.4            20.3
4...............................................            67.0            31.2            79.4            35.5
5...............................................            78.5            36.5            93.1            41.6
----------------------------------------------------------------------------------------------------------------

    The NPV of the monetized benefits associated with emissions 
reductions can be viewed as a complement to the NPV of the customer 
savings calculated for each TSL considered in this rulemaking. Table 
VII.47 and Table VII.48 present the NPV values that result from adding 
the estimates of the potential economic benefits resulting from reduced 
CO2 and NOX emissions in each of four valuation 
scenarios to the NPV of customer savings calculated for each TSL 
considered in this rulemaking, at both a 7-percent and a 3-percent 
discount rate, and for the low and high shipment scenarios, 
respectively. The CO2 values used in the columns of each 
table correspond to the four scenarios for the valuation of 
CO2 emission reductions discussed above.

[[Page 7831]]

  Table VII.47--Metal Halide Lamp Fixture TSLs: Net Present Value of Customer Savings Combined With Net Present
                        Value of Monetized Benefits From CO2 and NOX Emissions Reductions
                                            [Low shipments scenario]
----------------------------------------------------------------------------------------------------------------
                                                           Customer NPV at 3% discount rate added with:
                                                 ---------------------------------------------------------------
                                                   SCC value of    SCC value of    SCC value of    SCC value of
                       TSL                         $11.8/metric    $39.7/metric    $61.2/metric    $117.0/metric
                                                   ton CO2* and    ton CO2* and    ton CO2* and    ton CO2* and
                                                   medium value    medium value    medium value    medium value
                                                     for NOX**       for NOX**       for NOX**       for NOX**
----------------------------------------------------------------------------------------------------------------
                                                                           billion 2012$
----------------------------------------------------------------------------------------------------------------
1...............................................           0.928           1.352           1.673           2.478
2...............................................           1.099           1.634           2.040           3.059
3...............................................           1.084           1.634           2.051           3.096
4...............................................          -0.712           0.255           0.987           2.823
5...............................................          -0.724           0.409           1.268           3.420
----------------------------------------------------------------------------------------------------------------
                                                           Customer NPV at 7% discount rate added with:
----------------------------------------------------------------------------------------------------------------
                                                                           billion 2012$
----------------------------------------------------------------------------------------------------------------
1...............................................           0.386           0.810           1.131           1.936
2...............................................           0.452           0.988           1.394           2.412
3...............................................           0.435           0.985           1.402           2.447
4...............................................          -0.518           0.449           1.181           3.017
5...............................................          -0.553           0.580           1.439           3.591
----------------------------------------------------------------------------------------------------------------
* These label values represent the global SCC in 2015, in 2012$. The present values have been calculated with
  scenario-consistent discount rates.
** Medium Value corresponds to $2,639 per ton of NOX emissions.

  Table VII.48--Metal Halide Lamp Fixture TSLs: Net Present Value of Customer Savings Combined With Net Present
                        Value of Monetized Benefits From CO2 and NOX Emissions Reductions
                                            [High Shipments Scenario]
----------------------------------------------------------------------------------------------------------------
                                                           Customer NPV at 3% discount rate added with:
                                                 ---------------------------------------------------------------
                                                   SCC value of    SCC value of    SCC value of    SCC value of
                       TSL                         $11.8/metric    $39.7/metric    $61.2/metric    $117.0/metric
                                                   ton CO2* and    ton CO2* and    ton CO2* and    ton CO2* and
                                                   medium value    medium value    medium value    medium value
                                                     for NOX**       for NOX**       for NOX**       for NOX**
----------------------------------------------------------------------------------------------------------------
                                                                           billion 2012$
----------------------------------------------------------------------------------------------------------------
1...............................................           1.141           1.657           2.049           3.024
2...............................................           1.353           2.005           2.501           3.732
3...............................................           1.338           2.008           2.516           3.780
4...............................................          -0.790           0.380           1.271           3.483
5...............................................          -0.792           0.583           1.628           4.225
----------------------------------------------------------------------------------------------------------------
                                                           Customer NPV at 7% discount rate added with:
----------------------------------------------------------------------------------------------------------------
                                                                           billion 2012$
----------------------------------------------------------------------------------------------------------------
1...............................................           0.458           0.974           1.366           2.340
2...............................................           0.537           1.189           1.685           2.916
3...............................................           0.518           1.188           1.696           2.960
4...............................................          -0.561           0.610           1.500           3.712
5...............................................          -0.595           0.780           1.825           4.422
----------------------------------------------------------------------------------------------------------------
* These label values represent the global SCC in 2015, in 2012$. The present values have been calculated with
  scenario-consistent discount rates.
** Medium Value corresponds to $2,639 per ton of NOX emissions.

    Although adding the value of customer savings to the values of 
emission reductions provides a valuable perspective, the following 
should be considered: (1) The national customer savings are domestic 
U.S. customer monetary savings found in market transactions, while the 
values of emissions reductions are based on estimates of marginal 
social costs, which, in the case of CO2, are based on a 
global value; and (2) the assessments of customer savings and 
emissions-related benefits are performed with different computer 
models, leading to different time frames for analysis. For fixtures, 
the present value of national customer savings is measured for the 
period in which units shipped in 2017-2046 continue to operate. The SCC 
values, on the other hand, reflect the

[[Page 7832]]

present value of future climate-related impacts resulting from the 
emission of one metric ton of CO2 in each year. These 
impacts continue well beyond 2100.

C. Conclusions

    DOE is subject to the EPCA requirement that any new or amended 
energy conservation standard for any type (or class) of covered 
equipment be designed to achieve the maximum improvement in energy 
efficiency that the Secretary determines is technologically feasible 
and economically justified. (42 U.S.C. 6295(o)(2)(A)) In determining 
whether a standard is economically justified, the Secretary must 
determine whether the benefits of the standard exceed its burdens to 
the greatest extent practicable, in light of the seven statutory 
factors discussed previously. (42 U.S.C. 6295(o)(2)(B)(i)) The new or 
amended standard must also result in a significant conservation of 
energy. (42 U.S.C. 6295(o)(3)(B))
    DOE considered the impacts of MHLF standards at each trial standard 
level, beginning with the max-tech level, to determine whether that 
level met the evaluation criteria. If the max-tech level was not 
justified, DOE then considered the next most efficient level and 
undertook the same evaluation until it reached the highest efficiency 
level that is both technologically feasible and economically justified 
and saves a significant amount of energy.
    DOE discusses the benefits and/or burdens of each trial standard 
level in the following sections based on the quantitative analytical 
results for each trial standard level (presented in section VII.A) such 
as national energy savings, net present value (discounted at 7 and 3 
percent), emissions reductions, industry net present value, life-cycle 
cost, and customers' installed price increases. Beyond the quantitative 
results, DOE also considers other burdens and benefits that affect 
economic justification, including how technological feasibility, 
manufacturer costs, and impacts on competition may affect the economic 
results presented.
    To aid the reader as DOE discusses the benefits and burdens of each 
trial standard level, DOE has included the following tables (Table 
VII.49 and Table VII.50) that summarize DOE's quantitative analysis for 
each TSL. In addition to the quantitative results presented in the 
tables, DOE also considers other burdens and benefits that affect 
economic justification. Section VII.B.1 presents the estimated impacts 
of each TSL for the LCC subgroup analysis.

                                             Table VII.49--Summary of Results for Metal Halide Lamp Fixtures
                                                                [Low shipments scenario]
--------------------------------------------------------------------------------------------------------------------------------------------------------
              Category                        TSL 1                   TSL 2                  TSL 3                  TSL 4                  TSL 5
--------------------------------------------------------------------------------------------------------------------------------------------------------
National Energy Savings (quads)....  0.31..................  0.39..................  0.40.................  0.71.................  0.83
NPV of Customer Benefits (2012$
 billion)
    3% discount rate...............  0.78..................  0.92..................  0.90.................  (1.04)...............  (1.11)
    7% discount rate...............  0.26..................  0.29..................  0.27.................  (0.81)...............  (0.90)
Industry Impacts*
    Ballast + Fixture Industry NPV
    (2012$million)
    (Base Case Industry NPV of $413  393...................  391...................  390..................  336..................  305
     million).
    Ballast + Fixture Industry NPV   (20.1)................  (21.5)................  (22.6)...............  (76.6)...............  (107.5)
     (change in 2012$million).
    Ballast + Fixture Industry NPV   -4.9%.................  -5.2%.................  -5.5%................  -18.6%...............  -26.1%
     (% change).
Cumulative Emissions Reduction
    CO2 (Mt).......................  17.78.................  22.48.................  23.07................  40.53................  47.54
    SO2 (kt).......................  29.69.................  37.55.................  38.53................  67.73................  79.51
    NOX (kt).......................  22.29.................  28.19.................  28.93................  50.84................  59.64
    Hg (t).........................  0.04..................  0.05..................  0.05.................  0.08.................  0.10
    CH4 (kt).......................  83.74.................  105.90................  108.66...............  191.01...............  224.16
    N2O (kt).......................  0.37..................  0.46..................  0.47.................  0.83.................  0.98
Value of Cumulative Emissions
 Reduction
    CO2 (2012$ billion)**..........  0.1 to 1.7............  0.1 to 2.1............  0.1 to 2.2...........  0.3 to 3.8...........  0.3 to 4.5
    NOX--3% discount rate (2012$     29.4..................  37.2..................  38.2.................  67.0.................  78.5
     million)**.
    NOX--7% discount rate (2012$     13.7..................  17.3..................  17.8.................  31.2.................  36.5
     million)**.
Mean LCC Savings (and Percent
 Customers Experiencing Net
 Benefit)*** (2012$)
    50to100W--Ind--OtherV****[dagge  26.97 (100)...........  27.00 (100)...........  27.00 (100)..........  42.50 (82)...........  37.25 (79)
     r] (magnetic baseline).
    50to100W--Outd--OtherV           34.24 (98)............  34.88 (97)............  34.88 (97)...........  -4.98 (51)...........  -11.15 (49)
     (magnetic baseline).
    50to100W--Ind--OtherV            --....................  --....................  --...................  --...................  -5.25 (10)
     (electronic baseline).

[[Page 7833]]

 
    50to100W--Outd--OtherV           --....................  --....................  --...................  --...................  -6.17 (12)
     (electronic baseline).
    101to150W--Ind--OtherV[Dagger].  22.43 (100)...........  24.63 (99)............  24.63 (99)...........  89.67 (94)...........  76.11 (89)
    101to150W--Outd--OtherV........  27.37 (97)............  30.70 (97)............  30.70 (97)...........  52.23 (66)...........  36.60 (62)
    151to250W--Ind--OtherV[Dagger].  4.51 (60).............  4.51 (60).............  -1.07 (37)...........  -59.67 (18)..........  -40.33 (29)
    151to250W--Outd--OtherV........  6.74 (67).............  6.74 (67).............  1.48 (45)............  -119.65 (24).........  -97.86 (29)
    251to500W--Ind--OtherV.........  2.83 (47).............  7.95 (54).............  7.95 (54)............  -107.74 (8)..........  130.60 (6)
    251to500W--Outd--OtherV........  6.16 (55).............  13.15 (62)............  13.15 (62)...........  -165.30 (19).........  -187.69 (16)
    501to1000W--Ind--OtherV........  1221.54 (100).........  1221.54 (100).........  1221.54 (100)........  1221.54 (100)........  1221.54 (100)
    501to1000W--Outd--OtherV.......  1631.94 (98)..........  1631.94 (98)..........  1631.94 (98).........  1631.94 (98).........  1631.94 (98)
    1001to2000W--Ind--OtherV.......  --....................  --....................  --...................  -67.15 (0)...........  -93.06 (0)
    1001to2000W--Outd--OtherV......  --....................  --....................  --...................  -63.71 (0)...........  -88.03 (0)
Median PBP (years)
    50to100W--Ind--OtherV (magnetic  1.4...................  4.5...................  4.5..................  3.7..................  6.0
     baseline).
    50to100W--Outd--OtherV           1.4...................  4.5...................  4.5..................  12.0.................  14.7
     (magnetic baseline).
    50to100W--Ind--OtherV            --....................  --....................  --...................  --...................  31.5
     (electronic baseline).
    50to100W--Outd--OtherV           --....................  --....................  --...................  --...................  55.8
     (electronic baseline).
    101to150W--Ind--OtherV[Dagger].  4.3...................  7.3...................  7.3..................  2.5..................  4.8
    101to150W--Outd--OtherV........  4.5...................  8.1...................  8.1..................  7.5..................  10.3
    151to250W--Ind--OtherV[Dagger].  14.2..................  14.2..................  17.9.................  113.2................  38.4
    151to250W--Outd--OtherV........  17.4..................  17.4..................  22.8.................  326.7................  135.1
    251to500W--Ind--OtherV.........  16.2..................  15.0..................  15.0.................  369.2................  137.2
    251to500W--Outd--OtherV........  19.9..................  18.4..................  18.4.................  Never................  Never
    501to1000W--Ind--OtherV........  0.8...................  0.8...................  0.8..................  0.8..................  0.8
    501to1000W--Outd--OtherV.......  0.8...................  0.8...................  0.8..................  0.8..................  0.8
    1001to2000W--Ind--OtherV.......  --....................  --....................  --...................  209.4................  162.7
    1001to2000W--Outd--OtherV......  --....................  --....................  --...................  244.5................  190.0
Employment Impacts
    Direct Employment Impacts......  47--(339).............  62--(339).............  69--(339)............  73--(339)............  93--(339)
    Indirect Domestic Jobs           135...................  170...................  155..................  65...................  80
     .
--------------------------------------------------------------------------------------------------------------------------------------------------------
* INPV results are shown under the preservation of operating profit markup scenario.
** Range of the economic value of CO2 reductions is based on estimates of the global benefit of reduced CO2 emissions. Economic value of NOX reductions
  is based on estimates at $2639/ton.
*** For LCCs, a negative value means an increase in LCC by the amount indicated.
**** ``Indoor'' and ``outdoor'' as defined in section V.A.2.
[dagger] Equipment class abbreviations in the form of 50 to100W--Ind--OtherV refers to the equipment class of fixtures with (1) a rated lamp wattage of
  50 W to 100 W, (2) an indoor operating location, and (3) a tested input voltage other than 480 V. See section V.A.2 for more detail on equipment class
  distinctions.
[Dagger] The >100 W and =150 W and  Changes in 2022.

                                             Table VII.50--Summary of Results for Metal Halide Lamp Fixtures
                                                                [High shipments scenario)
--------------------------------------------------------------------------------------------------------------------------------------------------------
             Category                        TSL 1                   TSL 2                   TSL 3                  TSL 4                  TSL 5
--------------------------------------------------------------------------------------------------------------------------------------------------------
National Energy Savings (quads)...  0.39..................  0.49..................  0.50..................  0.88.................  1.03
NPV of Customer Benefits (2012$
 billion)
    3% discount rate..............  0.97..................  1.13..................  1.11..................  (1.18)...............  (1.25)
    7% discount rate..............  0.30..................  0.34..................  0.32..................  (0.91)...............  (1.00)
Industry Impacts *
    Ballast + Fixture Industry NPV
     (2012$million)
    (Base Case Industry NPV of      478...................  491...................  497...................  501..................  497
     $453 million).
Ballast + Fixture Industry NPV      25.3..................  38.0..................  44.0..................  48.1.................  44.2
 (change in 2012$million).
    Ballast + Fixture Industry NPV  5.6%..................  8.4%..................  9.7%..................  10.6%................  9.7%
     (% change).
Cumulative Emissions Reduction

[[Page 7834]]

 
    CO2 (Mt)......................  22.01.................  27.80.................  28.53.................  49.90................  58.63
    SO2 (kt)......................  37.40.................  47.25.................  48.49.................  84.80................  99.72
    NOX (kt)......................  27.72.................  35.02.................  35.93.................  62.85................  73.86
    Hg (t)........................  0.05..................  0.06..................  0.06..................  0.10.................  0.12
    CH4 (kt)......................  104.80................  132.40................  135.87................  237.66...............  279.39
    N2O (kt)......................  0.47..................  0.60..................  0.61..................  1.07.................  1.26
Value of Cumulative Emissions
 Reduction
    CO2 (2012$ billion) **........  0.1 to 2.0............  0.2 to 2.6............  0.2 to 2.6............  0.3 to 4.6...........  0.4 to 5.4
    NOX--3% discount rate (2012$    35.0..................  44.2..................  45.4..................  79.4.................  93.1
     million) **.
    NOX--7% discount rate (2012$    15.6..................  19.8..................  20.3..................  35.5.................  41.6
     million) **.
Mean LCC Savings (and Percent
 Customers Experiencing Net
 Benefit) *** (2012$)
    50to100W--Ind--OtherV           26.97 (100)...........  27.00 (100)...........  27.00 (100)...........  42.50 (82)...........  37.25 (79)
     ****[dagger] (magnetic
     baseline).
    50to100W--Outd--OtherV          34.24 (98)............  34.88 (97)............  34.88 (97)............  -4.98 (51)...........  -11.15 (49)
     (magnetic baseline).
    50to100W--Ind--OtherV           ......................  ......................  ......................  .....................  -5.25 (10)
     (electronic baseline).
    50to100W--Outd--OtherV          ......................  ......................  ......................  .....................  -6.17 (12)
     (electronic baseline).
    100to149W--Ind--OtherV[Dagger]  22.43 (100)...........  24.63 (99)............  24.63 (99)............  89.67 (94)...........  76.11 (89)
    100to149W--Outd--OtherV.......  27.37 (97)............  30.70 (97)............  30.70 (97)............  52.23 (66)...........  36.60 (62)
    150to250W--Ind--OtherV[Dagger]  4.51 (60).............  4.51 (60).............  -1.07 (37)............  -59.67 (18)..........  -40.33 (29)
    150to250W--Outd--OtherV.......  6.74 (67).............  6.74 (67).............  1.48 (45).............  -119.65 (24).........  -97.86 (29)
    251to500W--Ind--OtherV........  2.83 (47).............  7.95 (54).............  7.95 (54).............  -107.74 (8)..........  130.60 (6)
    251to500W--Outd--OtherV.......  6.16 (55).............  13.15 (62)............  13.15 (62)............  -165.30 (19).........  -187.69 (16)
    501to1000W--Ind--OtherV.......  1221.54 (100).........  1221.54 (100).........  1221.54 (100).........  1221.54 (100)........  1221.54 (100)
    501to1000W--Outd--OtherV......  1631.94 (98)..........  1631.94 (98)..........  1631.94 (98)..........  1631.94 (98).........  1631.94 (98)
    1001to2000W--Ind--OtherV......  ......................  ......................  ......................  -67.15 (0)...........  -93.06 (0)
    1001to2000W--Outd--OtherV.....  ......................  ......................  ......................  -63.71 (0)...........  -88.03 (0)
Median PBP (years)
    50to100W--Ind--OtherV           1.4...................  4.5...................  4.5...................  3.7..................  6.0
     (magnetic baseline).
    50to100W--Outd--OtherV          1.4...................  4.5...................  4.5...................  12.0.................  14.7
     (magnetic baseline).
    50to100W--Ind--OtherV           ......................  ......................  ......................  .....................  31.5
     (electronic baseline).
    50to100W--Outd--OtherV          ......................  ......................  ......................  .....................  55.8
     (electronic baseline).
    100to149W--Ind--OtherV[Dagger]  4.3...................  7.3...................  7.3...................  2.5..................  4.8
    100to149W--Outd--OtherV.......  4.5...................  8.1...................  8.1...................  7.5..................  10.3
    150to25W0--Ind--OtherV[Dagger]  14.2..................  14.2..................  17.9..................  113.2................  38.4
    150to250W--Outd--OtherV.......  17.4..................  17.4..................  22.8..................  326.7................  135.1
    251to500W--Ind--OtherV........  16.2..................  15.0..................  15.0..................  369.2................  137.2
    251to500W--Outd--OtherV.......  19.9..................  18.4..................  18.4..................  Never................  Never
    501to1000W--Ind--OtherV.......  0.8...................  0.8...................  0.8...................  0.8..................  0.8
    501to1000W--Outd--OtherV......  0.8...................  0.8...................  0.8...................  0.8..................  0.8
    1001to2000W--Ind--OtherV......  ......................  ......................  ......................  209.4................  162.7
    1001to2000W--Outd--OtherV.....  ......................  ......................  ......................  244.5................  190.0
Employment Impacts
    Direct Employment Impacts.....  48-(345)..............  63-(345)..............  70-(345)..............  74-(345).............  95-(345)
    Indirect Domestic Jobs          650...................  945...................  1300..................  2755.................  2655
     .
--------------------------------------------------------------------------------------------------------------------------------------------------------
* INPV results are shown under the -flat markup scenario.
** Range of the economic value of CO2 reductions is based on estimates of the global benefit of reduced CO2 emissions. Economic value of NOX reductions
  is based on estimates at $2,639/ton.
*** For LCCs, a negative value means an increase in LCC by the amount indicated.
**** ``Indoor'' and ``outdoor'' as defined in section V.A.2.
[dagger] Equipment class abbreviations in the form of 50 to100W--Ind--OtherV refers to the equipment class of fixtures with (1) a rated lamp wattage of
  50 W to 100 W, (2) an indoor operating location, and (3) a tested input voltage other than 480 V. See section V.A.2 for more detail on equipment class
  distinctions.
[Dagger] The >100 W and =150 W and  Changes in 2022.

1. Trial Standard Level 5
    DOE first considered the most efficient level, TSL 5, which would 
save an estimated total of 0.83 to 1.03 quads of energy for fixtures 
shipped in 2017 through 2046, a significant amount of energy. For the 
nation as a whole, TSL 5 would have net costs ranging from a decrease 
of $0.90 billion to a decrease of $1.0 billion at a 7-percent discount 
rate, and a decrease of $1.1 billion to a decrease of $1.3 billion at a 
3-percent discount rate. The emissions reductions at TSL 5 are 
estimated to be 48 to 59 million metric tons (Mt) of CO2, 80 
to 100 kt of SO2, 60 to 74 kt of NOX, and 0.10 to 
0.12 tons of Hg. As seen in section VII.B.1, customers have available 
designs that result in positive mean LCC savings for a majority of 
customers for only five out of twelve of the representative equipment 
classes, ranging from $37 to $1632, at TSL 5. The equipment classes 
with positive mean LCC savings for a majority of customers at TSL 5 are 
indoor fixtures at 70 W (compared to the magnetic 70 W baseline), 150 
W, and 1000 W; and outdoor fixtures at 150 W and 1000 W. Additionally, 
DOE's NPV analysis

[[Page 7835]]

indicates (see Table VII.49) that most equipment classes experience a 
negative NPV at TSL 5. The equipment classes that have negative NPV at 
TSL 5 are indoor and outdoor 70 W, 250 W, 400 W, and 1500 W fixtures. 
The equipment classes with positive NPV at TSL 5 are indoor and outdoor 
150 W and 1000 W fixtures. The projected change in industry value for 
MH ballast manufacturers would range from an increase of $15.0 million 
to a decrease of $19.0 million, or a net gain of 20.3 percent to a net 
loss of 28.3 percent in INPV. The projected change in industry value 
for MHLF manufacturers would range from an increase of $29.1 million to 
a decrease of $88.6 million, or a net gain of 7.7 percent to a net loss 
of 25.6 percent in INPV.
    DOE based TSL 5 on the most efficient commercially available 
equipment for each representative equipment class analyzed. This TSL 
corresponds to a commercially available low-frequency electronic 
ballast for indoor and outdoor 70 W, 150 W, 250 W, 400 W fixtures, and 
a modeled magnetic ballast in 1000 W and 1500 W. TSL 5 also prohibits 
the use of probe-start ballasts in new 1000 W fixtures.
    Although TSL 5 for 150 W MHLFs shows positive LCC savings and NPVs, 
DOE believes uncertainty remains regarding the cost effectiveness of 
electronic ballasts for these customers, especially in outdoor 
applications. There has been virtually no market penetration of 
electronic ballasts in outdoor applications according to DOE's shipment 
analysis. Further, DOE received comments from manufacturers and 
utilities that electronic ballasts are not suitable for outdoor 
applications due to their lower operating temperature limits, different 
sizes compared to magnetic ballasts, and susceptibility to transient 
voltage fluctuations. DOE has conducted significant research to address 
each one of these issues (see section V.C.8.b), but remains concerned 
that requiring electronic ballasts for 150 W MHLFs could cause 
disproportionate financial hardship for these customers. Therefore, DOE 
is not adopting an efficiency level that requires electronic ballasts 
in this final rule. DOE will continue to monitor the market share of 
electronic ballasts, particularly in outdoor applications, and may 
revisit this decision in future rulemakings.
    After considering the analysis, the comments that DOE received on 
the NOPR, and the benefits and burdens of TSL 5, the Secretary has 
reached the following conclusion: The benefits of energy savings, 
emissions reductions (both in physical reductions and the monetized 
value of those reductions), and positive net economic savings to the 
nation for some equipment classes are outweighed by the negative NPV 
experienced in some equipment classes at both a 3-percent and 7-percent 
discount rate, the negative mean LCC savings experienced in most 
equipment classes, the negative mean LCC savings experienced by some 
customer subgroups, the potential decrease in INPV for manufacturers, 
and the uncertainty regarding electronic ballasts. Consequently, the 
Secretary has concluded that TSL 5 is not economically justified.
2. Trial Standard Level 4
    DOE then considered TSL 4, which would save an estimated total of 
0.71 to 0.88 quads of energy for fixtures shipped in 2017 through 2046, 
a significant amount of energy. For the nation as a whole, TSL 4 would 
have net costs ranging from a decrease of $0.81 billion to a decrease 
of $0.91 billion at a 7-percent discount rate, and a decrease of $1.0 
billion to a decrease of $1.2 billion at a 3-percent discount rate. The 
emissions reduction at TSL 4 are estimated to be 41 to 50 Mt of 
CO2, 68 to 85 kt of SO2, 51 to 63 kt of 
NOX, and 0.08 to 0.10 tons of Hg. As seen in section 
VII.B.1, for less than half of the representative equipment classes, 
customers have available designs that result in positive mean LCC 
savings for a majority of customers, ranging from $43 to $1632, at TSL 
4. Additionally, DOE's NPV analysis indicates (see Table VI.34) that 
less than half of the representative classes have a positive NPV at TSL 
4. The projected change in industry value for MH ballast manufacturers 
would range from an increase of $9.6 million to a decrease of $16.2 
million, or a net gain of 12.9 percent to a net loss of 24.1 percent in 
INPV. The projected change in industry value for MHLF manufacturers 
would range from an increase of $38.6 million to a decrease of $60.4 
million, or a net gain of 10.2 percent to a net loss of 17.5 percent in 
INPV.
    TSL 4 represents the next highest EL for all equipment classes not 
justified at TSL 5. This TSL corresponds to a commercially available 
low-frequency electronic ballast in indoor and outdoor 70 W, 150 W, 250 
W, and 400 W fixtures; a commercially available magnetic ballast in 
indoor and outdoor 1500 W fixtures; and a modeled magnetic ballast in 
indoor and outdoor 1000 W fixtures. TSL 4 also prohibits the use of 
probe-start ballasts in new 1000 W fixtures.
    Although TSL 4 for 150 W MHLFs shows positive LCC savings and NPVs, 
DOE believes uncertainty remains regarding the cost effectiveness of 
electronic ballasts for these customers, especially in outdoor 
applications. There has been virtually no market penetration of 
electronic ballasts in outdoor applications according to DOE's shipment 
analysis. Further, DOE received comments from manufacturers and 
utilities that electronic ballasts are not suitable for outdoor 
applications due to their lower operating temperature limits, different 
sizes compared to magnetic ballasts, and susceptibility to transient 
voltage fluctuations. DOE has conducted significant research to address 
each one of these issues (see section V.C.8.b), but remains concerned 
that requiring electronic ballasts for 150 W MHLFs could cause 
disproportionate financial hardship for these customers. Therefore, DOE 
is not adopting an efficiency level that requires electronic ballasts 
in this final rule. DOE will continue to monitor the market share of 
electronic ballasts, particularly in outdoor applications, and may 
revisit this decision in future rulemakings.
    After considering the analysis, the comments that DOE received on 
the NOPR, and the benefits and burdens of TSL 4, the Secretary has 
reached the following conclusion: At TSL 4, the benefits of energy 
savings, emissions reductions (both in physical reductions and the 
monetized value of those reductions), and positive net economic savings 
to the nation are outweighed by negative NPV experienced in some 
equipment classes at both 3-percent and 7-percent discount rate, the 
negative mean LCC savings experienced in some equipment classes, the 
negative mean LCC savings for the utility customer subgroup, the 
potential decrease in INPV for manufacturers, and the uncertainty 
regarding electronic ballasts. Consequently, the Secretary has 
concluded that TSL 4 is not economically justified.
3. Trial Standard Level 3
    DOE then considered TSL 3, which would save an estimated total of 
0.40 to 0.50 quads of energy for fixtures shipped in 2017 through 2046, 
a significant amount of energy. For the nation as a whole, TSL 3 would 
have positive net savings of $0.27 billion to $0.32 billion at a 7-
percent discount rate and $0.90 billion to $1.1 billion at a 3-percent 
discount rate. The emissions reductions at TSL 3 are estimated to be 23 
to 29 Mt of CO2, 39 to 48 kt of SO2, 29 to 36 kt 
of NOX, and 0.05 to 0.06 tons of Hg. As seen in section 
VII.B.1, for most representative equipment classes, customers have 
available designs that result in positive mean LCC savings, ranging 
from $8 to $1632, at TSL 3.

[[Page 7836]]

DOE's NPV analysis indicates (see Table VI.34) that most equipment 
classes have a positive NPV at TSL 3, though indoor and outdoor 250 W 
customers experience negative NPV. The projected change in industry 
value for MH ballast manufacturers would range from an increase of $0.6 
million to a decrease of $19.0 million, or a net gain of 0.8 percent to 
a net loss of 28.3 percent in INPV. The projected change in industry 
value for MHLF manufacturers would range from an increase of $43.4 
million to a decrease of $3.6 million, or a net gain of 11.4 percent to 
a net loss of 1.1 percent in INPV.
    TSL 3 represents the next highest EL for all equipment classes not 
justified at TSL 4, requiring that indoor and outdoor fixtures are set 
at the same ELs. This TSL corresponds to a modeled magnetic ballast in 
indoor and outdoor fixtures at 70 W, 150 W, 250 W, 400 W, and 1000 W. 
Indoor and outdoor fixtures at 1500 W would remain at baseline, with no 
new standards established. TSL 3 also prohibits the use of probe-start 
ballasts in new 1000 W fixtures.
    After considering the analysis, the comments that DOE received on 
the preliminary analysis, and the benefits and burdens of TSL 3, the 
Secretary has reached the following conclusion: At TSL 3, the benefits 
of energy savings, emissions reductions (both in physical reductions 
and monetized value of those reductions), and positive net economic 
savings to the nation would be outweighed by the negative NPV 
experienced in the 250 W indoor and outdoor equipment classes at 7-
percent discount rate and the potential decrease in INPV for 
manufacturers. Consequently, the Secretary has tentatively concluded 
that TSL 3 is not economically justified.
4. Trial Standard Level 2
    DOE then considered TSL 2, which would save an estimated total of 
0.39 to 0.49 quads of energy for fixtures shipped in 2017 through 2046, 
a significant amount of energy. For the nation as a whole, TSL 2 would 
have a positive net savings of $0.29 billion to $0.34 billion at a 7-
percent discount rate, and $0.92 billion to $1.1 billion at a 3-percent 
discount rate. The emissions reductions at TSL 3 are estimated to be 23 
to 28 Mt of CO2, approximately 38 to 47 kt of 
SO2, 28 to 35 kt of NOX, and 0.05 to 0.06 tons of 
Hg. As seen in section VII.B.1, for all representative equipment 
classes, customers have available designs that result in positive mean 
LCC savings, ranging from $5 to $1,632, at TSL 2. DOE's NPV analysis 
indicates (see Table VI.34) that each equipment class has a positive 
NPV at TSL 2. The projected change in industry value for MH ballast 
manufacturers would range from a decrease of $0.4 million to a decrease 
of $17.9 million, or a net loss from 0.5 percent to 26.7 percent in 
INPV. The projected change in industry value for MHLF manufacturers 
would range from an increase of $38.3 million to a decrease of $3.6 
million, or a net gain of 10.1 percent to net loss of 1.0 percent in 
INPV.
    TSL 2 represents the highest magnetic ELs with a positive NPV, 
where the same ELs are required for indoor and outdoor fixtures. This 
TSL corresponds to a modeled magnetic ballast in 70 W, 150 W, 400 W, 
and 1000 W; and a commercially available magnetic ballast in 250 W. 
Indoor and outdoor fixtures at 1500 W would remain at baseline, with no 
new standards set. TSL 2 also prohibits the use of probe-start ballasts 
in new 1000 W fixtures.
    After considering the analysis, the comments that DOE received on 
the NOPR, and the benefits and burdens of TSL 2, the Secretary has 
reached the following conclusion: TSL 2 offers the maximum improvement 
in efficiency that is technologically feasible and economically 
justified, and will result in significant conservation of energy. The 
benefits of energy savings, emissions reductions (both in physical 
reductions and the monetized value of those reductions), positive net 
economic savings (NPV) at discount rates of 3-percent and 7-percent at 
each representative equipment class would outweigh the potential 
reduction in INPV for manufacturers. Therefore, DOE today adopts energy 
conservation standards for metal halide lamp fixtures at TSL 2.

D. Final Standard Equations

    As detailed in section VII.C of this notice, DOE is adopting TSL 2. 
TSL 2 sets an EL2 standard for indoor and outdoor metal halide fixtures 
for 50 W-150 W and 251 W-1000 W, and an EL1 standard for indoor and 
outdoor metal halide fixtures for 151 W-250 W. This creates a 
discontinuous combination of equations both above and below the 151 W-
250 W equipment class. The discontinuity at 150 W occurs because 
fixtures below 150 W do not have to comply with EISA 2007, while those 
at 150 W and above are required to meet the 88 percent standard of EISA 
2007. However, the discontinuity at 250 W occurs because TSL 2 
represents EL1 from 151 W-250 W, but EL2 from 251 W-500 W. To maintain 
continuity, DOE developed new equations from 151 W-500 W. First, from 
151 W-200 W, DOE maintained a flat 88 percent requirement. Then, from 
201 W-500 W, DOE used one continuous power-law equation. Based on 
written comments from NEMA, lamps in this wattage range follow the same 
trend between lamp current squared (an indicator of ballast losses) and 
lamp wattage. (NEMA, No. 56 at p. 15) This implies that one equation 
can be used to represent the efficiency of all ballasts in this wattage 
range. The equation was created by connecting the 200 W ballasts with 
0.880 efficiency with the 500 W EL2 efficiency (0.910) to ensure 
continuity with the EL equations for adjacent wattage ranges. The 250 W 
EL1 and 400 W EL2 representative units comply with the new equation. 
The resulting TSL 2 equations are shown in Table VII.51 below.

                                           Table VII.51--TSL Equation
----------------------------------------------------------------------------------------------------------------
           Wattage range                    Efficiency level               EL equation          TSL equation
----------------------------------------------------------------------------------------------------------------
>=50 W and                     1/
                                                                       (1+1.24xP[supcaret]   (1+1.24xP[supcaret]
                                                                       (-0.351)) [dagger].   (-0.351))
>100 W and                     1/
                                                                       (1+1.24xP[supcaret]   (1+1.24xP[supcaret]
                                                                       (-0.351)).            (-0.351))
>=150 W ** and =150 W and =150 W and 200 W and 200 W and 
                                                                                             (1+0.876xP[supcaret
                                                                                             ](-0.351))
>250 W and 
                                                                                             (1+0.876xP[supcaret
                                                                                             ](-0.351))
>500 W and 500 W and 500 W and 750 W and 750 W and =50 W and (1+1.24xP[supcaret](-0.351)) -
                                                                               0.0200)
>100 W and (1+1.24xP[supcaret](-0.351)) -
                                                                               0.0200)
>=150 W ** and 250 W and 250 W and =265 W and 
                                                                               (1+0.876xP[supcaret](-0.351)) -
                                                                               0.0100
>500 W and 500 W and 750 W and outdoor***      Test input      Existing standards       standards/
          lamp wattage                                 voltage[Dagger]       (efficiency)    equations[dagger] %
----------------------------------------------------------------------------------------------------------------
>=50 W and A...............  (1/
                                                                                              (1+1.24xP[supcaret
                                                                                              ](-0.351))) -
                                                                                              0.020
>=50 W and A...............  1/
                                                                                              (1+1.24xP[supcaret
                                                                                              ](-0.351))
>=50 W and A...............  (1/
                                                                                              (1+1.24xP[supcaret
                                                                                              ](-0.351))) -
                                                                                              0.020
>=50 W and A...............  1/
                                                                                              (1+1.24xP[supcaret
                                                                                              ](-0.351))
>100 W and A...............  (1/
                                                                                              (1+1.24xP[supcaret
                                                                                              ](-0.351))) -
                                                                                              0.020
>100 W and A...............  1/
                                                                                              (1+1.24xP[supcaret
                                                                                              ](-0.351))
>100 W and A...............  (1/
                                                                                              (1+1.24xP[supcaret
                                                                                              ](-0.351))) -
                                                                                              0.020
>100 W and A...............  1/
                                                                                              (1+1.24xP[supcaret
                                                                                              ](-0.351))
>=150 W** and =150 W** and =150 W and
                                                                          94% depending on    200 W and
                                                                                              
                                                                                              (1+0.876xP[supcare
                                                                                              t](-0.351))
>=150 W** and =150 W** and =150 W and
                                                                          94% depending on    200 W and
                                                                                              
                                                                                              (1+0.876xP[supcare
                                                                                              t](-0.351))
>250 W and 250 W and =265 W and
                                                                                              
                                                                                              (1+0.876xP[supcare
                                                                                              t](-0.351))--0.010
>250 W and 
                                                                          94% depending on    (1+0.876xP[supcare
                                                                          ballast type.       t](-0.351))
>250 W and 250 W and =265 W and
                                                                                              
                                                                                              (1+0.876xP[supcare
                                                                                              t](-0.351)) -
                                                                                              0.010
>250 W and 
                                                                          94% depending on    (1+0.876xP[supcare
                                                                          ballast type.       t](-0.351))
>500 W and A...............  For >500 W and
                                                                                              750 W and 500 W and
                                                                                              500 W and A...............  For >500 W and
                                                                                              750 W and
                                                                                              500 W and
                                                                                              500 W and A...............  For >500 W and
                                                                                              750 W and
                                                                                              500 W and
                                                                                              500 W and A...............  For >500 W and
                                                                                              750 W and
                                                                                              500 W and
                                                                                              =150 W would be tested at 277
  V. Ballasts not designed to operate at either of these voltages would be tested at the highest voltage the
  ballast is designed to operate.

VIII. Procedural Issues and Regulatory Review

A. Review Under Executive Orders 12866 and 13563

    Section 1(b)(1) of Executive Order 12866, ``Regulatory Planning and 
Review,'' 58 FR 51735 (Oct. 4, 1993), requires each agency to identify 
the problem that it intends to address, including, where applicable, 
the failures of private markets or public institutions that warrant new 
agency action, as well as to assess the significance of that problem. 
The problems that today's standards address are as follows:
    There are external benefits resulting from improved energy 
efficiency of MHLFs that are not captured by the users of such 
equipment. These benefits include externalities related to 
environmental protection and energy security that are not reflected in 
energy prices, such as emissions of greenhouse gases. DOE attempts to 
quantify some of the external benefits through use of SCC values.
    In addition, DOE has determined that today's regulatory action is 
an ``economically significant regulatory action'' under section 3(f)(1) 
of Executive Order 12866. Accordingly, section 6(a)(3) of the Executive 
Order requires that DOE prepare a regulatory impact analysis (RIA) on 
today's rule and that the Office of Information and Regulatory Affairs 
(OIRA) in the Office of Management and Budget review this rule. DOE 
presented to OIRA for review the draft rule and other documents 
prepared for this rulemaking, including the RIA, and has included these 
documents in the rulemaking record. The assessments prepared pursuant 
to Executive Order 12866 can be found in the technical support document 
for this rulemaking.
    DOE has also reviewed this regulation pursuant to Executive Order 
13563, issued on January 18, 2011 (76 FR 3281, Jan. 21, 2011). EO 13563 
is supplemental to and explicitly reaffirms the principles, structures, 
and definitions governing regulatory review established in Executive 
Order 12866. To the extent permitted by law, agencies are required by 
Executive Order 13563 to: (1) Propose or adopt a regulation only upon a 
reasoned determination that its benefits justify its costs (recognizing 
that some benefits and costs are difficult to quantify); (2) tailor 
regulations to impose the least burden on society, consistent with 
obtaining regulatory objectives, taking into account, among other 
things, and to the extent practicable, the costs of cumulative 
regulations; (3) select, in choosing among alternative regulatory 
approaches, those approaches that maximize net benefits (including 
potential economic, environmental, public health and safety, and other 
advantages; distributive impacts; and equity); (4) to the extent 
feasible, specify performance objectives, rather than specifying the 
behavior or manner of compliance that regulated entities must adopt; 
and (5) identify and assess available alternatives to direct 
regulation, including providing economic incentives to encourage the 
desired behavior, such as user fees or marketable permits, or providing 
information upon which choices can be made by the public.
    DOE emphasizes as well that Executive Order 13563 requires agencies 
to use the best available techniques to quantify anticipated present 
and future benefits and costs as accurately as possible. In its 
guidance, OIRA has emphasized that such techniques may include 
identifying changing future compliance costs that might result from 
technological innovation or anticipated behavioral changes. For the 
reasons stated in the preamble, DOE believes that today's final rule is 
consistent with these principles, including the requirement that, to 
the extent permitted by law, benefits justify costs and that net 
benefits are maximized.

B. Review Under the Regulatory Flexibility Act

    The Regulatory Flexibility Act (5 U.S.C. 601 et seq.) requires 
preparation of an initial regulatory flexibility analysis (IRFA) for 
any rule that by law must be proposed for public comment, and a final 
regulatory flexibility analysis (FRFA) for any such rule that an agency 
adopts as a final rule, unless the agency certifies that the rule, if 
promulgated, will not have a significant economic impact on a 
substantial number of small entities. As required byE.O. 13272, 
``Proper Consideration of Small Entities in Agency Rulemaking,'' 67 FR 
53461 (Aug. 16, 2002), DOE published procedures and policies on 
February 19, 2003, to ensure that the potential impacts of its rules on 
small entities are properly considered during the rulemaking process. 
68 FR 7990. DOE has made its procedures and policies available on the 
Office of the General Counsel's Web site (http://energy.gov/gc/office-general-counsel). DOE reviewed the August 2013 NOPR and today's final 
rule under the provisions of the Regulatory Flexibility Act and the 
procedures and policies published on February 19, 2003.
    As a result of this review, DOE has prepared a FRFA for MHLFs and

[[Page 7840]]

ballasts, a copy of which DOE will transmit to the Chief Counsel for 
Advocacy of the SBA for review under 5 U.S.C. 605(b). As presented and 
discussed below, the FRFA describes impacts on small MHLF and ballast 
manufacturers and discusses alternatives that could minimize these 
impacts.
    A statement of the reasons for establishing the standards in 
today's final rule, and the objectives of and legal basis for these 
standards, are set forth elsewhere in the preamble and not repeated 
here.
    This FRFA incorporates the IRFA and public comments DOE received on 
the IRFA and the economic impacts of the rule. DOE provides responses 
to these comments in the discussion below on the compliance impacts of 
the standards and elsewhere in the preamble. DOE modified the standards 
adopted in today's final rule in response to comments received as 
described in the preamble.
1. Description and Estimated Number of Small Entities Regulated
a. Methodology for Estimating the Number of Small Entities
    For manufacturers of MHLFs and ballasts, the SBA has set a size 
threshold which defines those entities classified as ``small 
businesses'' for the purposes of the statute. DOE used the SBA's small 
business size standards to determine whether any small entities would 
be subject to the requirements of the rule. 65 FR 30836, 30850 (May 15, 
2000), as amended at 65 FR 53533, 53545 (Sept. 5, 2000) and codified at 
13 CFR part 121. The size standards are listed by North American 
Industry Classification System (NAICS) code and industry description 
and are available at http://www.sba.gov/sites/default/files/files/Size_Standards_Table.pdf. MH ballast manufacturing is classified 
under NAICS 335311, ``Power, Distribution and Specialty Transformer 
Manufacturing.'' The SBA sets a threshold of 750 employees or less for 
an entity to be considered as a small business for this category. MHLF 
manufacturing is classified under NAICS 335122, ``Commercial, 
Industrial, and Institutional Electric Lighting Fixture 
Manufacturing.'' The SBA sets a threshold of 500 employees or less for 
an entity to be considered as a small business for this category.
    In the NOPR, DOE identified five small businesses that produce MH 
ballasts sold in the United States and can be considered small business 
manufacturers. For MHLFs, DOE identified approximately 54 small 
businesses that produce MHLFs sold in the United States and can be 
considered small business manufacturers. DOE did not receive any 
comments to suggest these estimates should be altered for the FRFA.
b. Manufacturer Participation
    As stated in the August 2013 NOPR, DOE attempted to contact the 
small business manufacturers of MHLFs and ballasts it had identified. 
One small MH ballast manufacturer and two small MHLF manufacturers 
consented to being interviewed. DOE also obtained information about 
small business impacts while interviewing large manufacturers.
c. Metal Halide Ballast and Fixture Industry Structure
    Ballasts. Five major MH ballast manufacturers with limited domestic 
production supply the vast majority of the MH ballast market. None of 
the five major manufacturers is a small business. The remaining market 
share is held by a few smaller domestic companies, only one of which 
has significant market share. Nearly all MH ballast production occurs 
abroad.
    Fixtures. The majority of the MHLF market is supplied by six major 
manufacturers with sizeable domestic production. None of these major 
manufacturers is a small business. The remaining market share is held 
by several smaller domestic and foreign manufacturers. Most of the 
small domestic manufacturers produce MHLFs in the United States. 
Although none of the small businesses holds a significant market share 
individually, collectively these small businesses account for 
approximately a third of the market. See chapter 3 of this final rule 
TSD for further details on the MHLF and ballast markets.
d. Comparison Between Large and Small Entities
    Ballasts. The five large MH ballast manufacturers typically offer a 
much wider range of designs of MH ballasts than small manufacturers do. 
MH ballasts can vary by start method, input voltage, wattage, and 
design. Often large MH ballast manufacturers will offer several 
different ballast options for each lamp wattage. Small manufacturers 
generally specialize in manufacturing only a handful of different 
ballast types and do not have the volume to support as wide a range of 
products as large manufacturers do. Three of the five small MH ballast 
manufacturers specialize in high-efficiency electronic ballasts and do 
not offer any magnetic ballasts. Some small MH ballast manufacturers 
offer a wide variety of lighting products, but others focus exclusively 
on MH ballasts.
    Fixtures. The six large MHLF manufacturers typically serve large-
scale commercial lighting markets, while small MHLF manufacturers tend 
to operate in niche lighting markets such as architectural and designer 
lighting. Small MHLF manufacturers also frequently fill custom orders 
that are much smaller in volume than large MHLF manufacturers' typical 
orders are. Because small MHLF manufacturers typically offer 
specialized products and cater to individual customers' needs, they can 
command higher markups than most large MHLF manufacturers. Like large 
MH ballast manufacturers, large MHLF manufacturers offer a wider range 
of MHLFs than small MHLF manufacturers. A small MHLF manufacturer may 
offer fewer than 50 models, while a large MHLF manufacturer may 
typically offer several hundred models. Almost all small MHLF 
manufacturers offer a variety of lighting products in addition to those 
covered by this rulemaking, such as fluorescent, incandescent, and LED 
fixtures.
2. Description and Estimate of Compliance Requirements
    Ballasts. Because three of the five small MH ballast manufacturers 
offer only electronic ballasts that already meet the standards at TSL 
2, the level established in today's final rule, DOE does not expect any 
product or capital conversion costs for these small MH ballast 
manufacturers. The fourth small MH ballast manufacturer offers a wide 
range of magnetic and electronic ballasts, so DOE does not expect this 
manufacturer's conversion costs to differ significantly from those of 
the large manufacturers. The fifth small ballast manufacturer currently 
offers a large variety of lighting products, but only two models of MH 
ballasts. Because it would likely invest in other parts of its 
business, this manufacturer stated to DOE that this rulemaking is 
unlikely to significantly affect them.
    Fixtures. As previously stated, DOE identified approximately 54 
small MHLF businesses affected by this rulemaking. Based on interviews 
with two of these manufacturers and examinations of product offerings 
on company Web sites, DOE believes that approximately one-fourth of 
these small businesses will not face any conversion costs because they 
offer very few MHLF models and would, therefore, focus on more 
substantial areas of their business. Of the remaining small businesses 
DOE identified, nearly two-thirds primarily

[[Page 7841]]

serve the architectural or specialty lighting markets. Because these 
products command higher prices and margins compared to the typical 
products offered by a large manufacturer, DOE believes that these small 
MHLF manufacturers will be able to pass on any necessary conversion 
costs to their customers without significantly impacting their 
businesses.
    Philips commented that they believe small MHLF manufacturers might 
not be able to pass cost increases due to standards, because in the 
architectural and specialty lighting areas, LEDs are becoming extremely 
cost competitive. (Philips, Public Meeting Transcript, No. 48 at p. 
289) Based on small business fixture manufacturer interviews, DOE 
believes that many of the architectural and specialty lighting fixtures 
are custom made orders and the conversion costs for these MHLFs would 
likely be small. While DOE does acknowledge that the MH ballasts used 
in these MHLFs could increase in price, which would result in a higher 
priced MHLF for customers, these small fixture manufacturers stated 
they also manufacture and sell LED fixtures to meet any customer's 
needs.
    The remaining small MHLF manufacturers (roughly 14 in number) could 
be differentially impacted by today's established standards. These 
manufacturers operate partially in industrial and commoditized markets 
in which it may be more difficult to pass on any disproportionate costs 
to their customers. The impacts could be relatively greater for a 
typical small MHLF manufacturer because of the far lower production 
volumes and the relatively fixed nature of the R&D and capital 
resources required per fixture family.
    Based on interviews, however, DOE anticipates that small 
manufacturers would take steps to mitigate the costs required to meet 
new and amended energy conservation standards. DOE believes that under 
the established standards, small MHLF businesses would likely 
selectively upgrade existing product lines to offer equipment that is 
in high demand or offers a strategic advantage for that company. Small 
manufacturers could then spread out further investments over a longer 
time period by not upgrading all product lines prior to the compliance 
date.
    Additionally, DOE does not expect that small MHLF manufacturers 
would be significantly burdened by compliance requirements. As 
discussed in section IV.A, the standards adopted in this final rule 
provide simplifying amendments to the current testing and reporting 
procedures. DOE is only mandating testing at a single input voltage for 
MHLFs Because DOE selected the least burdensome input voltage option, 
DOE concludes that regulations in this final rule would not have a 
significantly adverse impact on the testing burden of small 
manufacturers.
    The existing test procedures already dictate that testing for 
certification requires a sample of at least four MHLFs for compliance. 
DOE is not proposing to change this minimum sample size, and as such, 
does not find an increased testing burden on small manufacturers.
    DOE did not receive any comments suggesting new and amended energy 
conservation standards would significantly impact small MHLF and 
ballast manufacturers.
3. Duplication, Overlap, and Conflict With Other Rules and Regulations
    DOE is not aware of any rules or regulations that duplicate, 
overlap, or conflict with the rule being established today.
4. Significant Alternatives to the Rule
    Section VII.B.2 analyzes impacts on small businesses that would 
result from DOE's adopted rule. In addition to the other TSLs being 
considered, the final rule TSD includes an RIA. For MHLFs, the RIA 
discusses the following policy alternatives: (1) No new regulatory 
action; (2) consumer tax incentives; (3) manufacturer tax incentives; 
(4) performance standards; (5) consumer rebates; (6) manufacturer 
rebates; (7) voluntary energy efficiency targets; (8) early 
replacement; and (9) bulk government purchases. While these 
alternatives may mitigate to some varying extent the economic impacts 
on small entities compared to the standards, DOE determined that the 
energy savings of these alternatives are significantly smaller than 
those that would be expected to result from the adopted standard 
levels. Accordingly, DOE is declining to adopt any of these 
alternatives and is adopting the standards set forth in this 
rulemaking. (See chapter 18 of the final rule TSD for further detail on 
the policy alternatives DOE considered.)
    As previously stated, DOE did not receive any comments suggesting 
new and amended energy conservation standards would significantly 
impact small MHLF and ballast manufacturers.

C. Review Under the Paperwork Reduction Act

    Manufacturers of MHLFs must certify to DOE that their equipment 
complies with any applicable energy conservation standards. In 
certifying compliance, manufacturers must test their equipment 
according to DOE test procedures for MHLFs, including any amendments 
adopted for those test procedures. DOE has established regulations for 
the certification and recordkeeping requirements for all covered 
consumer products and commercial equipment, including MHLFs. (76 FR 
12422 (March 7, 2011). The collection-of-information requirement for 
the certification and recordkeeping is subject to review and approval 
by OMB under the Paperwork Reduction Act (PRA). This requirement has 
been approved by OMB under OMB control number 1910-1400. Public 
reporting burden for the certification is estimated to average 20 hours 
per response, including the time for reviewing instructions, searching 
existing data sources, gathering and maintaining the data needed, and 
completing and reviewing the collection of information.
    Notwithstanding any other provision of the law, no person is 
required to respond to, nor shall any person be subject to a penalty 
for failure to comply with, a collection of information subject to the 
requirements of the PRA, unless that collection of information displays 
a currently valid OMB control number.

D. Review Under the National Environmental Policy Act of 1969

    Pursuant to the National Environmental Policy Act (NEPA) of 1969, 
DOE has determined that the rule fits within the category of actions 
included in Categorical Exclusion (CX) B5.1 and otherwise meets the 
requirements for application of a CX. See 10 CFR Part 1021, App. B, 
B5.1(b); 1021.410(b) and Appendix B, B(1)-(5). The rule fits within the 
category of actions because it is a rulemaking that establishes energy 
conservation standards for consumer products or industrial equipment, 
and for which none of the exceptions identified in CX B5.1(b) apply. 
Therefore, DOE has made a CX determination for this rulemaking, and DOE 
does not need to prepare an Environmental Assessment or Environmental 
Impact Statement for this rule. DOE's CX determination for this rule is 
available at http://cxnepa.energy.gov/.

E. Review Under Executive Order 13132

    Executive Order 13132, ``Federalism.'' 64 FR 43255 (Aug. 10, 1999) 
imposes certain requirements on federal agencies formulating and 
implementing policies or regulations that preempt state law or that 
have Federalism implications. The Executive Order requires agencies to

[[Page 7842]]

examine the constitutional and statutory authority supporting any 
action that would limit the policymaking discretion of the states and 
to carefully assess the necessity for such actions. The Executive Order 
also requires agencies to have an accountable process to ensure 
meaningful and timely input by state and local officials in the 
development of regulatory policies that have Federalism implications. 
On March 14, 2000, DOE published a statement of policy describing the 
intergovernmental consultation process it will follow in the 
development of such regulations. 65 FR 13735. EPCA governs and 
prescribes federal preemption of state regulations as to energy 
conservation for the equipment that is the subject of today's final 
rule. States can petition DOE for exemption from such preemption to the 
extent, and based on criteria, set forth in EPCA. (42 U.S.C. 6297) No 
further action is required by Executive Order 13132.

F. Review Under Executive Order 12988

    With respect to the review of existing regulations and the 
promulgation of new regulations, section 3(a) of Executive Order 12988, 
``Civil Justice Reform,'' imposes on federal agencies the general duty 
to adhere to the following requirements: (1) Eliminate drafting errors 
and ambiguity; (2) write regulations to minimize litigation; and (3) 
provide a clear legal standard for affected conduct rather than a 
general standard and promote simplification and burden reduction. 61 FR 
4729 (Feb. 7, 1996). Section 3(b) of Executive Order 12988 specifically 
requires that Executive agencies make every reasonable effort to ensure 
that the regulation: (1) clearly specifies the preemptive effect, if 
any; (2) clearly specifies any effect on existing federal law or 
regulation; (3) provides a clear legal standard for affected conduct 
while promoting simplification and burden reduction; (4) specifies the 
retroactive effect, if any; (5) adequately defines key terms; and (6) 
addresses other important issues affecting clarity and general 
draftsmanship under any guidelines issued by the Attorney General. 
Section 3(c) of Executive Order 12988 requires Executive agencies to 
review regulations in light of applicable standards in section 3(a) and 
section 3(b) to determine whether they are met or it is unreasonable to 
meet one or more of them. DOE has completed the required review and 
determined that, to the extent permitted by law, this final rule meets 
the relevant standards of Executive Order 12988.

G. Review Under the Unfunded Mandates Reform Act of 1995

    Title II of the Unfunded Mandates Reform Act of 1995 (UMRA) 
requires each federal agency to assess the effects of federal 
regulatory actions on state, local, and Tribal governments and the 
private sector. Public Law 104-4, sec. 201 (codified at 2 U.S.C. 1531). 
For a new and amended regulatory action likely to result in a rule that 
may cause the expenditure by state, local, and Tribal governments, in 
the aggregate, or by the private sector of $100 million or more in any 
one year (adjusted annually for inflation), section 202 of UMRA 
requires a federal agency to publish a written statement that estimates 
the resulting costs, benefits, and other effects on the national 
economy. (2 U.S.C. 1532(a), (b)) The UMRA also requires a federal 
agency to develop an effective process to permit timely input by 
elected officers of state, local, and Tribal governments on a 
``significant intergovernmental mandate,'' and requires an agency plan 
for giving notice and opportunity for timely input to potentially 
affected small governments before establishing any requirements that 
might significantly or uniquely affect small governments. On March 18, 
1997, DOE published a statement of policy on its process for 
intergovernmental consultation under UMRA. 62 FR 12820. DOE's policy 
statement is also available at http://energy.gov/gc/office-general-counsel.
    DOE has concluded that this final rule would likely require 
expenditures of $100 million or more on the private sector. Such 
expenditures may include: (1) Investment in research and development 
and in capital expenditures by MHLFs manufacturers in the years between 
the final rule and the compliance date for the new standards, and (2) 
incremental additional expenditures by customers to purchase higher-
efficiency MHLFs, starting at the compliance date for the applicable 
standard.
    Section 202 of UMRA authorizes a federal agency to respond to the 
content requirements of UMRA in any other statement or analysis that 
accompanies the final rule. 2 U.S.C. 1532(c). The content requirements 
of section 202(b) of UMRA relevant to a private sector mandate 
substantially overlap the economic analysis requirements that apply 
under section 325(o) of EPCA and Executive Order 12866. The 
SUPPLEMENTARY INFORMATION section of the notice of final rulemaking and 
the ``Regulatory Impact Analysis'' section of the TSD for this final 
rule respond to those requirements.
    Under section 205 of UMRA, the Department is obligated to identify 
and consider a reasonable number of regulatory alternatives before 
promulgating a rule for which a written statement under section 202 is 
required. 2 U.S.C. 1535(a). DOE is required to select from those 
alternatives the most cost-effective and least burdensome alternative 
that achieves the objectives of the rule unless DOE publishes an 
explanation for doing otherwise, or the selection of such an 
alternative is inconsistent with law. As required by 42 U.S.C. 
6295(hh), and (o), 6317(a), today's final rule would establish energy 
conservation standards for MHLFs that are designed to achieve the 
maximum improvement in energy efficiency that DOE has determined to be 
both technologically feasible and economically justified. A full 
discussion of the alternatives considered by DOE is presented in the 
``Regulatory Impact Analysis'' section of the TSD for today's final 
rule.

H. Review Under the Treasury and General Government Appropriations Act, 
1999

    Section 654 of the Treasury and General Government Appropriations 
Act, 1999 (Pub. L. 105-277) requires federal agencies to issue a Family 
Policymaking Assessment for any rule that may affect family well-being. 
This rule would not have any impact on the autonomy or integrity of the 
family as an institution. Accordingly, DOE has concluded that it is not 
necessary to prepare a Family Policymaking Assessment.

I. Review Under Executive Order 12630

    DOE has determined, under Executive Order 12630, ``Governmental 
Actions and Interference with Constitutionally Protected Property 
Rights'' 53 FR 8859 (March 18, 1988), that this regulation would not 
result in any takings that might require compensation under the Fifth 
Amendment to the U.S. Constitution.

J. Review Under the Treasury and General Government Appropriations Act, 
2001

    Section 515 of the Treasury and General Government Appropriations 
Act, 2001 (44 U.S.C. 3516, note) provides for federal agencies to 
review most disseminations of information to the public under 
guidelines established by each agency pursuant to general guidelines 
issued by OMB. OMB's guidelines were published at 67 FR 8452 (Feb. 22, 
2002), and DOE's guidelines were published at 67 FR 62446 (Oct. 7, 
2002). DOE has reviewed

[[Page 7843]]

today's final rule under the OMB and DOE guidelines and has concluded 
that it is consistent with applicable policies in those guidelines.

K. Review Under Executive Order 13211

    Executive Order 13211, ``Actions Concerning Regulations That 
Significantly Affect Energy Supply, Distribution, or Use'' 66 FR 28355 
(May 22, 2001), requires federal agencies to prepare and submit to OIRA 
at OMB, a Statement of Energy Effects for any significant energy 
action. A ``significant energy action'' is defined as any action by an 
agency that promulgates or is expected to lead to promulgation of a 
final rule, and that: (1) Is a significant regulatory action under 
Executive Order 12866, or any successor order; and (2) is likely to 
have a significant adverse effect on the supply, distribution, or use 
of energy, or (3) is designated by the Administrator of OIRA as a 
significant energy action. For any significant energy action, the 
agency must give a detailed statement of any adverse effects on energy 
supply, distribution, or use should the proposal be implemented, and of 
reasonable alternatives to the action and their expected benefits on 
energy supply, distribution, and use.
    DOE has concluded that today's regulatory action, which sets forth 
energy conservation standards for MHLFs, is not a significant energy 
action because the new and amended standards are not likely to have a 
significant adverse effect on the supply, distribution, or use of 
energy, nor has it been designated as such by the Administrator at 
OIRA. Accordingly, DOE has not prepared a Statement of Energy Effects 
on the final rule.

L. Review Under the Information Quality Bulletin for Peer Review

    On December 16, 2004, OMB, in consultation with the Office of 
Science and Technology Policy (OSTP), issued its Final Information 
Quality Bulletin for Peer Review (the Bulletin). 70 FR 2664 (Jan. 14, 
2005). The Bulletin establishes that certain scientific information 
shall be peer reviewed by qualified specialists before it is 
disseminated by the Federal Government, including influential 
scientific information related to agency regulatory actions. The 
purpose of the Bulletin is to enhance the quality and credibility of 
the Government's scientific information. Under the Bulletin, the energy 
conservation standards rulemaking analyses are ``influential scientific 
information,'' which the Bulletin defines as scientific information the 
agency reasonably can determine will have, or does have, a clear and 
substantial impact on important public policies or private sector 
decisions. 70 FR 2667.
    In response to OMB's Bulletin, DOE conducted formal in-progress 
peer reviews of the energy conservation standards development process 
and analyses and has prepared a Peer Review Report pertaining to the 
energy conservation standards rulemaking analyses. Generation of this 
report involved a rigorous, formal, and documented evaluation using 
objective criteria and qualified and independent reviewers to make a 
judgment as to the technical/scientific/business merit, the actual or 
anticipated results, and the productivity and management effectiveness 
of programs and/or projects. The ``Energy Conservation Standards 
Rulemaking Peer Review Report'' dated February 2007 has been 
disseminated and is available at the following Web site: 
www1.eere.energy.gov/buildings/appliance_standards/peer_review.html.

M. Congressional Notification

    As required by 5 U.S.C. 801, DOE will report to Congress on the 
promulgation of this rule prior to its effective date. The report will 
state that it has been determined that the rule is not a ``major rule'' 
as defined by 5 U.S.C. 804(2).

IX. Approval of the Office of the Secretary

    The Secretary of Energy has approved publication of today's final 
rule.

List of Subjects in 10 CFR Part 431

    Administrative practice and procedure, Confidential business 
information, Energy conservation, Household appliances, Imports, 
Incorporation by reference, Intergovernmental relations, Reporting and 
recordkeeping requirements, and Small businesses.

    Issued in Washington, DC, on January 27, 2014.
 David T. Danielson,
Assistant Secretary, Energy Efficiency and Renewable Energy.
    For the reasons set forth in the preamble, DOE amends part 431 of 
chapter II, subchapter D, of title 10 of the Code of Federal 
Regulations, as set forth below:

PART 431--ENERGY EFFICIENCY PROGRAM FOR CERTAIN COMMERCIAL AND 
INDUSTRIAL EQUIPMENT

0
1. The authority citation for part 431 continues to read as follows:

    Authority: 42 U.S.C. 6291-6317.

0
2. Section 431.322 is amended by adding in alphabetical order 
definitions for ``general lighting application'' ``high-frequency 
electronic metal halide ballast,'' and ``nonpulse-start electronic 
ballast,'' to read as follows:

Sec.  431.322  Definitions concerning metal halide ballasts and 
fixtures.

* * * * *
    General lighting application means lighting that provides an 
interior or exterior area with overall illumination.
    High-frequency electronic metal halide ballast means an electronic 
ballast that operates a lamp at an output frequency of 1000 Hz or 
greater.
* * * * *
    Nonpulse-start electronic ballast means an electronic ballast with 
a starting method other than pulse-start.
* * * * *

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3. Section 431.324 is amended by adding paragraph (b)(1)(iii) and 
revising paragraphs (b)(3) and (c)(1) to read as follows:

Sec.  431.324  Uniform test method for the measurement of energy 
efficiency and standby mode energy consumption of metal halide 
ballasts.

* * * * *
    (b) * * *
    (1) * * *
    (iii) Input Voltage for Tests. For ballasts designed to operate 
lamps rated less than 150 W that have 120 V as an available input 
voltage, testing shall be performed at 120 V. For ballasts designed to 
operate lamps rated less than 150 W that do not have 120 V as an 
available voltage, testing shall be performed at the highest available 
input voltage. For ballasts designed to operate lamps rated greater 
than or equal to 150 W that have 277 V as an available input voltage, 
testing shall be conducted at 277 V. For ballasts designed to operate 
lamps rated greater than or equal to 150 W that do not have 277 V as an 
available input voltage, testing shall be conducted at the highest 
available input voltage.
* * * * *
    (3) Efficiency Calculation. The measured lamp output power shall be 
divided by the measured ballast input power to determine the percent 
efficiency of the ballast under test to three significant figures.
    (i) A fractional number at or above the midpoint between two 
consecutive decimal places shall be rounded up to the higher of the two 
decimal places; or
    (ii) A fractional number below the midpoint between two consecutive 
decimal places shall be rounded down to the lower of the two decimal 
places.
    (c) * * *

[[Page 7844]]

    (1) Test Conditions. (i) The power supply and ballast test 
conditions with the exception of input voltage shall all conform to the 
requirements specified in section 4.0, ``General Conditions for 
Electrical Performance Tests,'' of the ANSI C82.6 (incorporated by 
reference; see Sec.  431.323). Ambient temperatures for the testing 
period shall be maintained at 25 [deg]C  5 [deg]C. Send a 
signal to the ballast instructing it to have zero light output using 
the appropriate ballast communication protocol or system for the 
ballast being tested.
    (ii) Input Voltage for Tests. For ballasts designed to operate 
lamps rated less than 150 W that have 120 V as an available input 
voltage, ballasts are to be tested at 120 V. For ballasts designed to 
operate lamps rated less than 150 W that do not have 120 V as an 
available voltage, ballasts are to be tested at the highest available 
input voltage. For ballasts designed to operate lamps rated greater 
than or equal to 150 W that have 277 V as an available input voltage, 
ballasts are to be tested at 277 V. For ballasts designed to operate 
lamps rated greater than or equal to 150 W that do not have 277 V as an 
available input voltage, ballasts are to be tested at the highest 
available input voltage.
* * * * *

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4. Section 431.326 is amended by adding paragraphs (c), (d), and (e) to 
read as follows:

Sec.  431.326  Energy conservation standards and their effective dates.

* * * * *
    (c) Except when the requirements of paragraph (a) of this section 
are more stringent (i.e., require a larger minimum efficiency value) or 
as provided by paragraph (e) of this section, each metal halide lamp 
fixture manufactured on or after February 10, 2017, must contain a 
metal halide ballast with an efficiency not less than the value 
determined from the appropriate equation in the following table:

----------------------------------------------------------------------------------------------------------------
Designed to be  operated with lamps of              Tested input                       Minimum standard
   the following rated lamp wattage            voltage[Dagger][Dagger]            equation[dagger][dagger] %
----------------------------------------------------------------------------------------------------------------
>=50 W and (1+1.24xP[supcaret](-0.351))) -
                                                                               0.020[dagger][dagger]
>=50 W and (1+1.24xP[supcaret](-0.351))
>100 W and (1+1.24xP[supcaret](-0.351))) -
                                                                               0.020
>100 W and (1+1.24xP[supcaret](-0.351))
>=150 [Dagger] W and =150 [Dagger] W and =150 W and 200 W and 
                                                                               (1+0.876xP[supcaret](-0.351))
>250 W and 250 and =265 W and 
                                                                               (1+0.876xP[supcaret](-0.351)) -
                                                                               0.010
>250 W and (1+0.876xP[supcaret](-0.351))
>500 W and 500 W and 750 W and 500 W and 500 W and 500 W and 750 W and 500 W and 500 W to pre>
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