## AMCA

- Advocate Meeting, Chicago December 4

- 5, 2014 Building Technologies Office Energy Efficiency & Renewable Energy Department of Energy 

# Energy Conservation Standards for Commercial and Industrial Fans2 

# Topics

1. Introduction and Rulem aking Background

2. Scope of the NODA

3. Metric Used in the NODA

4. Engineering A nalysis

5. Manufacturer Impact Analysis

6. Life C ycle Cost and Payback Period Analysis

7. National I mpact Analysis

8. Requests f or Comments3 

# Introduction and Rulemaking Background

• Title III of the Energy Policy and Conservation Act of 1975 (42 U.S.C.6291, et seq ; “EPCA”), Pub. L. 94

- 163, sets forth a variety of provisions designed to improve energy efficiency. Part C of title III, which for editorial reasons was re

- designated as Part A

- 1 upon incorporation into the U.S. Code (42 U.S.C. 6311

– 6317, as codified), establishes the "Energy Conservation Program for Certain Industrial Equipment." These include commercial and industrial fans and blowers (42 U.S.C. 6311(1)(H))

• On J une 28, 2011, DOE published a Notice of Proposed Determination of Coverage (76 FR 37678)

• On February 1, 2013, DOE published a notice in the Federal Register that

a nnounced the availability of the “Commercial and Industrial Fans and Blowers Energy Conservation Standard Framework Document.” (78 FR 7304)

• On December 3, 2014, DOE issued a notice of data availability (NODA) for “Commercial and Industrial Fans and Blowers Energy Conservation Standard Framework Document” that announced the availability of five spreadsheets ( http://energy.gov/sites/prod/files/2014/12/f19/fans_blowers_noda_0.pdf )4 

# Topics

1. Introduction and Ru lemaking Background

2. Scope of the NODA

3. Metric Used in the NODA

4. Engineering A nalysis

5. Manufacturer Impact Analysis

6. Life C ycle Cost and Payback Period Analysis

7. National I mpact Analysis

8. Requests f or Comments5 

# Scope of the NODA

• Scope of the analysis presented in the NODA

– F an types included in analysis

• Axial Fans

• Centrifugal Fans

• Inline and Mixed Flow Fans

• Radial Fans

• Power Roof Ventilator Fans



## – Fan types NOT included in analysis

• Safety Fans

• Cross Flow Fans

• Circulating Fans

• Induced Flow fans

• Air Curtains



## – Scope limit

• T he fan has a maximum shaft input power of at least 1 horsepower (0.746 kW) but not greater than 200 horsepower (149 kW) at its maximum speed6 

# Topics

1. Introduction and Ru lemaking Background

2. Scope of the NODA

3. Metric Used in the NODA

4. Engineering A nalysis

5. Manufacturer Impact Analysis

6. Life C ycle Cost and Payback Period Analysis

7. National I mpact Analysis

8. Requests f or Comments7 

# Metric U sed in the NODA

• Fan Energy Index (FEI) : Fan energy rating (FER STD 

# ) of a fan that exactly meets the efficiency level analyzed divided by the FER of a given fan model (FER)



# FFFFFF = FFFFFF SSSSSS 

# FFFFFF

• Fan Energy Rating (FER), represents the electric input power to the fan over a

s pecified load profile, at a given speed



# FFFFFF = ∑ ωω ii 

# PP ii iiii ii



# = ∑ ωω ii 

# ( ii PP oooooo
, ii 

### ηη ffffff

, ii 

### × ηη TT
, ii 

# + LL MM
, ii 

# )

– Where

– Speed for FEI calculation is 850, 1150, 1750, or 3550 RPM depending on the fan’s

o perating speed range.

• i = load points: 100%, 110% and 115% of flow at BEP

• ω i 

## = weighting at each loading point (equal weighting)

• P in i 

## = electric input power to the fan • P out,i 

## = output airpower of the fan

• η fan,i 

## = total fan efficiency

• η T,i 

## = default transmission efficiency

• L M,i 

## = default motor losses8 

# Metric U sed in the NODA

• Fan Energy Rating for a fan that exactly meets the efficiency level being analyzed (FER STD 

# ) is calculated based on the same equation, at the same specified speed



# FFFFFF SSSSSS 

# = ∑ ωω ii 

# PP ii iiii ii



# = ∑ ωω ii 

# ( ii PP oooooo
, ii 

### ηη ffffff
, SSSSSS
, ii 

### × ηη TT
, ii 

# + LL MM
, ii 

# )

– W here

• i = l oad points: 100%, 110% and 115% of flow at BEP

• ηη ffff
, SS SSSS
, ii 

## = total fan efficiency at load point i for a fan that exactly meets the efficiency level being analyzed

– Assumed

• ηη ffff
, SSSSSS
, 110% 

## = 0.982 ηη ffff
, SS SSSS
, 100%



## • ηη ffff
, SS SSSS
, 115% 

## = 0.982 ηη ffff
, SS SSSS
, 100%



## – W here

• ηη ffff
, SS SSSS
, 100% 

## i s calculated as a function of flow and total pressure based on a
two

- variable polynomial of second order9 

# Metric Used in the NODA

• The calculation of the ηη ffff
, SSSSSS
, 100% 

## is based on the following equation for fan total efficiency at BEP and at 85 % maximum speed

ηη ffff ff , SSSSSS
, 100% 

## = CC + 10

. 2205 ∗ ln QQ + 2. 8085 ∗ ln PP − 0. 3932 ∗ ln QQ 2


## +0. 8530 ∗ ln QQ ∗ ln PP − 2. 1379 ∗ ln PP 2 

## / 100

• Where

– Q = flow at BEP at 85 percent maximum recommended speed in cubic feet per minute at
60Hz

– P = total pressure at BEP at 85 percent maximum recommended speed in inches of water

g auge at 60 Hz

– C = an intercept that is set for the surface, which is set based on the equipment type of the

a pplicable fan model. The C

- values are used to determine fan total efficiency corresponding to different market model cut

- off levels

• In order to use a single 3D surface equation, fan laws are used to convert the flow and pressure information from the FEI calculation speed to 85 % of the fan’s maximum speed

• This “3

- D surface” can be compared with AMCA’s PBER proposal and provides a relationship between efficiency as a function of flow and pressure10 

## PBER Two

- variable Polynomial “3D”

Calculated at BEP. The fan’s maximum speed is then set such as the fan meets the PBER and not as a function of the fan’s structural rigidity Calculated at 100%, 110%, 115% of BEP flow and at the maximum speed corresponding to a motor pole configuration and included in the fan’s operating speed range (850, 1150, 1750, or 3550 RPM) Calculated at design conditions. T he fan’s operating region is set such as the fan meets the PBER 

# Comparison with PBER

PBER “3D” ηη ffff = αα × QQ QQ + ββ × PP
PP + γγ ηη ffff ff , SSSSSS
, 100% = CC + aa ∗ ln QQ + bb ∗ ln PP + cc ∗ ln QQ 2

+ dd ∗ ln QQ ∗ ln PP + ee ∗ ln PP 2 / 10011 

# Topics

1. Introduction and Ru lemaking Background

2. Scope of the NODA

3. Metric Used in the NODA

4. Engineering Analy sis

5. Manufacturer Impact Analysis

6. Life C ycle Cost and Payback Period Analysis

7. National I mpact Analysis

8. Requests f or Comments12 

# Engineering Analysis Overview

Designate energy use

levels for

analysis

• Baseline

• Set not to cut off any models

from the market

• Max Tech

• Fans are a mature technology

with all available efficiency improvements already existing in the marketplace

• Intermediate energy use levels 

# Evaluate MPCs and manufacturer markups

• Identify subgroups in each

equipment group

• Calculated individually for each

subgroup

• Weighted based on

distribution of models in current market at each energy use level 

# Estimate aerodynamic redesign costs

• Evaluated for each subgroup,

then aggregated by equipment group and energy use level

• Resulting conversion cost

recovery markup included in standards

- case MSP in downstream analysis 

## • Evaluate costs associated with increased efficiency13 

# Energy Use Levels in PTE

• C- v alue (vertical offset) of PTE surface equation varies

– Determined separately for each
p otential energy level and equipment
group

– Based on cutting off fixed percentage of

m odels using resulting FER

• Database of 2800 fans

• Cut- of f percentages: 5, 10, 15, 20, 50 70



### – FEI 5 = 5% of that group’s models cut off

u sing that C

- value

– Example this slide: Axial Housed group

FEI (Cutoff %): Baseline* 5 10 15 20 50 70

Axial Housed C

- Value - - 18.6675

- 15.3981

- 13.562

- 11.7859

- 2.3139 3.6529

*Baseline is the C

- value that removes 0 percent of the market. As such, there are no C

- values associated with the baseline level

. 

## Axial Housed Peak Total EfficiencyPeak Total Efficiency14 

# Manufacturer Production Cost Assessment Methodology

• Subgroups

– Equipment groups divided into subgroups based

o n impeller type or presence of guide vanes



## • Teardowns

– Physical Teardowns conducted on 5 units from 4/ 26 subgroups

– Virtual Teardowns conducted on remaining

s ubgroups



## • MPC as a function of impeller diameter

– Estimated for one subgroup

– MPC multipliers calculated to adjust MPC func tion for other subgroups 

### Fan Group Subgroup Centrifugal Housed Airfoil Backward Curved Backward Inclined Forward Curved Centrifugal Unhoused Airfoil Backward Curved Backward Inclined Inline and Mixed Flow Mixed Flow - Airfoil Mixed Flow - Single Thickness Centrifugal Inline - Airfoil Centrifugal Inline - Backward Curved Centrifugal Inline - Backward Inclined Centrifugal Inline - Forward Curved Radial Open Radial Radial Tip Shrouded Radial Backplate Radial Power Roof Ventilator Centrifugal PRV - Airfoil Centrifugal PRV - Backward Curved Centrifugal PRV - Backward Inclined Centrifugal PRV - Forward Curved Axial PRV - Panel/Proppeller Axial PRV - Tubeaxial Axial Housed Vane Axial Tube Axial Axial Unhoused Panel/Propeller Physical &

Virtual Teardowns Bills of Materials (BOMs) Cost Model Cost

Efficiency Relationship15 

# Manufacturer Production Cost Assessment Methodology

Teardown results example

Raw Material Costs $222.34 Direct cost of raw materials

Purchased Parts Material Costs $139.87 Direct cost of purchased parts
Assembly Labor Cost $109.54 Component and unit assembly on manufacturing line

Fabrication Labor Cost $299.14 Conversion of raw material into parts ready for assembly
Supervision Cost $21.25 Fraction of indirect labor that is paid a higher wage

Indirect Labor Cost $141.88 Fraction of overall labor not associated directly with product manufacturing (e.g. forklift drivers, quality control)

Equipment Depreciation Cost $38.55 Straight line depreciation over expected equipment life
Tooling Depreciation Cost $3.56 Cost is allocated on a per

- use basis or obsolescence, whichever is shorter
Building Depreciation Cost $25.40 Straight line depreciation over expected building life

Indirect Process Costs $35.24 Consumables including welding rods, lubrication on dies, etc., as well as paint and related processes

Maintenance Costs $21.48 Based on installed equipment and tooling investment

Utility Costs $8.35 A fixed fraction of all material costs meant to cover electricity and other utility
costs

Property Tax $9.60 A fixed fraction based on total unit costs

Insurance $8.61 A fixed fraction based on total unit costs

Total $1,084.8016 

# Manufacturer Production Cost Calculations

• Established relationship:

MPC = Multiplier * (A * Diameter + Diameter ^ B)

– A = 18.92

– B = 2.10



## • Multiplier calculation:
Adjusts MPC curve for each subgroup

– Calculation example, Centrifugal Unhoused – Backward Inclined:

• Diameter of Virtual Teardown: 20.5”

• Virtual teardown MPC: $581.60

• MPC from equation, at teardown diameter: $964.09

• Resulting multiplier: $581.60/$964.09 =

0.603 $0 $500 $1,000 $1,500 $2,000 $2,500 $3,000 $3,500

0 10 20 30 40 50MPC [$]

Diameter [in] 

### MPC Scaling as a Function of Diameter

MPC Fit, Centrifugal Housed Airfoil
MPC Fit Adjusted for Centrifugal Unhoused Backward Inclined
Teardown MPC, Centrifugal Housed Airfoil
Teardown MPC, Centrifugal Unhoused Backward Inclined MPC = 1.00 * (18.92*D + D ^ 2.10)

MPC = 0.60 * (18.92*D + D ^ 2.10)17 

# Manufacturer Production Cost Results

FEI 0 5 10 15 20 50 70 Centrifugal Housed M WEIGHTED 0.77 0.80 0.83 0.86 0.88 0.97 0.98 Diameter [in] 10 20 30 10 20 30 10 20 30 10 20 30 10 20 30 10 20 30 10 20 30 Example MPC [$] 244 714 1,429 254 742 1,485 263 769 1,538 271 793 1,587 279 815 1,631 305 893 1,787 309 905 1,810 Centrifugal Unhoused M WEIGHTED 0.60 0.62 0.63 0.64 0.64 0.63 0.63 Diameter [in] 10 20 30 10 20 30 10 20 30 10 20 30 10 20 30 10 20 30 10 20 30 Example MPC [$] 191 560 1,120 196 573 1,146 199 582 1,165 201 588 1,177 202 590 1,181 200 584 1,168 200 584 1,168 Inline and Mixed Flow M WEIGHTED 0.90 0.90 0.90 0.90 0.90 0.95 0.96 Diameter [in] 10 20 30 10 20 30 10 20 30 10 20 30 10 20 30 10 20 30 10 20 30 Example MPC [$] 283 829 1,658 284 829 1,659 284 831 1,663 284 832 1,664 286 837 1,674 299 875 1,751 305 892 1,786 Radial M WEIGHTED 0.88 0.88 0.88 0.88 0.88 0.90 0.91 Diameter [in] 10 20 30 10 20 30 10 20 30 10 20 30 10 20 30 10 20 30 10 20 30 Example MPC [$] 280 819 1,639 280 819 1,639 280 819 1,639 280 819 1,639 280 819 1,639 285 833 1,666 289 846 1,693 Power Roof Ventilator M WEIGHTED 0.54 0.54 0.54 0.54 0.54 0.54 0.54 Diameter [in] 10 20 30 10 20 30 10 20 30 10 20 30 10 20 30 10 20 30 10 20 30 Example MPC [$] 171 501 1,002 171 501 1,002 171 501 1,002 171 501 1,002 171 501 1,002 171 501 1,002 171 501 1,002 Axial Housed M WEIGHTED 1.02 1.02 1.03 1.03 1.03 1.06 1.08 Diameter [in] 10 20 30 10 20 30 10 20 30 10 20 30 10 20 30 10 20 30 10 20 30 Example MPC [$] 323 946 1,893 324 948 1,897 325 950 1,902 326 954 1,908 327 957 1,915 336 984 1,969 343 1,003 2,007 Axial Unhoused M WEIGHTED 0.2 0.2 0.2 0.2 0.2 0.2 0.2 Diameter [in] 10 20 30 10 20 30 10 20 30 10 20 30 10 20 30 10 20 30 10 20 30 Example MPC [$] 62 181 361 62 181 361 62 181 361 62 181 361 62 181 361 62 181 361 62 181 36118 

# Manufacturer Selling Price

• MSP = Manufacturer Markup * Conversion Cost Recovery Markup * MPC

– Conversion Cost Recovery Markup

• Product conversion costs

– Modeled as being the same for all models regardless of size, performance, e quipment

group, or efficiency

– Calculated with the following assu mptions

» 6 mon th total redesign time

» 4 month testing time

» Additional costs for non

- D OE certifications and marketing

» Labor rates based on information from the Bureau of Labor and Statistics

• Capital conversion costs

– Modeled as different for each subgroup, but not varying with size, performance, or

e fficiency

– Assumptions made regarding manufacturing investments in tooling and fabrication

e quipment19 

# Industry Conversion Costs

• Total industry conversion c osts by equipment class

– Determined at each efficiency level by t he number of individual models (from the database of 2800 fans) that would be cut off in that equipment group at that level, with the following assumptions:

• All fans that did not meet the level would be redesigned to the efficiency level being analyzed

• The conversion costs varied only by the s ubgroup of the resulting model

• The r edesigned models would be distributed in the subgroups within each class in the proportions of
the subgroups between that efficiency level and the next in the base case (the database of 2800 fans)

– Example: If 100 models were cut off at housed axial FEI 5, all of them were assumed to be redesigned to meet

F EI 5. If, in the base case, 30% of the housed axial fans between FEI 5 and FEI 10 were vane axial and 70% were tube axial, then the assumption is that 30 fans would be aerodynamically redesigned to be vane axial and 70 to be tube axial regardless of the subgroups of the fans that were cut off20 

# Conversion Cost Results

• The resulting total industry conversion costs are presented in the table below

– Assumption: the database of 2800 fans represents all models on the market in the scope of the rulemaking

Equipment Class Total Conversion Cost for Each Equipment Class at Each Efficiency Level

FEI 0 FEI 5 FEI 10 FEI 15 FEI 20 FEI 50 FEI 70

Axial Housed $0 $2,608,515 $5,243,409 $7,898,257 $10,567,382 $26,638,238 $37,330,712

Axial Unhoused $0 $246,023 $492,045 $861,079 $1,107,102 $2,829,261 $3,936,363
Centrifugal Housed $0 $5,180,826 $10,305,247 $15,404,738 $20,504,842 $51,226,800 $72,511,767
Centrifugal Unhoused $0 $896,348 $1,808,992 $2,726,521 $3,639,041 $9,648,905 $13,421,612

Inline and Mixed Flow $0 $2,057,357 $4,123,137 $6,179,841 $8,457,972 $20,913,841 $29,002,399

Radial $0 $2,041,988 $4,083,976 $6,125,964 $8,167,953 $20,419,881 $28,448,452
Power Roof/Wall Ventilators $0 $1,291,619 $2,583,238 $3,874,857 $5,166,476 $12,916,190 $18,082,66621 

# Engineering Analysis Outputs

• The following three results were passed on to the downstream analyses:

– Database of 2800 fans each with an FER, diameter (and thus base

- c ase MSP), and equipment group

– Base case MSP (MSP = MPC * MM) by equipment group and efficiency level

– Total industry conversion costs by equipment group and efficiency level



## • The conversion cost recovery markup was c alculated as part of the LCC

– Same approach as used in pumps22 

# Topics

1. Introduction and Ru lemaking Background

2. Scope of the NODA

3. Metric Used in the NODA

4. Engineering A nalysis

5. Manufacturer Impact Analysis

6. Life C ycle Cost and Payback Period Analysis

7. National I mpact Analysis

8. Requests f or Comments23 

# Manufacturer Impact Analysis: Overview

• An MIA was performed on all manufacturers of covered CIFBs.

• Two markup scenarios were modeled to capture the range of potential outcomes

man ufacturers may experience following the implementation of energy conservation standards on CIFBs.

• Conversion Cost Pass Through Markup Scenario (Upper Bound)

- In t his scenario, manufacturers are able to increase their prices of remodeled CIFBs to fully recover the conversion costs associated with remodeling, testing, and certifying those CIFBs.

- This mark up scenario represents the upper bound of profitability for manufacturers since they are able to fully recover all of their conversion costs.

• Flat Markup Scenario (Lower Bound)

- In this scenario, manufacturers are not able to increase their prices at all following

e nergy conservation standards on CIFBs.

- This markup scenario represents the lower bound of profitability for manufacturers

s ince they are not able to recover any of their conversion costs.24 

# Manufacturer Impact Analysis: Results (Table)

• INPV Results for the Conversion Cost Pass Through Markup Scenario (Upper Bound)

* Numbers in parentheses represent negative values.



## • INPV Results for the Flat Markup Scenario (Lower Bound) FEI 0 FEI 5 FEI 10 FEI 15 FEI 20 FEI 50 FEI 70 INPV (2013$ MM) 499.2 480.8 465.4 447.3 429.9 340.3 278.0 Change in INPV (2013$ MM) - (18.4) (33.7) (51.9) (69.2) (158.9) (221.2)

Change in INPV (%) - (3.7) (6.8) (10.4) (13.9) (31.8) (44.3)

FEI 0 FEI 5 FEI 10 FEI 15 FEI 20 FEI 50 FEI 70 INPV (2013$ MM) 499.2 460.5 421.1 381.2 340.3 94.5 (79.5) Change in INPV (2013$ MM) - (38.7) (78.0) (118.0) (158.8) (404.7) (578.6)

Change in INPV (%) - (7.8) (15.6) (23.6) (31.8) (81.1) (115.9)25 

# Manufacturer Impact Analysis: Results (Graph)

• Potential INPV impacts of standards on CIFB manufacturers

- 7.8%

- 15.6%

- 23.6%

- 31.8%

- 81.1%

- 115.9%

- 3.7% - 6.8%

- 10.4%

- 13.9%

- 31.8%

- 44.3%

-140% -120% -100%

-80% -60% -40% -20%

0% 20%



### Base Case FEI 5 FEI 10 FEI 15 FEI 20 FEI 50 FEI 70% Change in INPV

Flat Markup Conversion Cost Pass Through Markup26 

# Manufacturer Impact Analysis: Small Business

• There are approximately 9 3 small businesses that could be affected by potential CIFB energy conservation standards. 35 of these small businesses are AMCA members.

• Based on preliminary market research, DOE has determined that the average small

man ufacturer typically offers fewer CIFB models, ships fewer units, and generates less revenue per model than an average large CIFB manufacturer. This could put small businesses at a disadvantage because any conversion costs they may incur would have to be spread over fewer units and smaller annual revenues.

• S mall man ufacturers may also be at a disadvantage regarding potential CIFB energy conservation standards due to a lack of engineering resources and a lack of experience in designing higher efficiency equipment

.

• DOE found in an analysis of its CIFB product database that on average, a smaller
p ercentage of small manufacturers’ product offerings meet each efficiency level compared to larger manufacturers.27 

# Topics

1. Introduction and Ru lemaking Background

2. Scope of the NODA

3. Metric Used in the NODA

4. Engineering A nalysis

5. Manufacturer Impact Analysis

6. Life Cycle Cost and Payback Period Analysis

7. National I mpact Analysis

8. Requests f or Comments28 

# Life

- Cycle Cost Calculation Overview

Baseline Manufacturer Cost Engineering Analysis Std

- Level Manufacturer Cost

Manufacturer Markup

Markups Analysis Distributor & Contractor Markups

Sales Tax

Energy Use Analysis Energy Consumption

Energy Prices Consumer Price

Installation Cost Total Installed Cost

Annual Energy Cost

Repair Cost

Maintenance Cost Annual Operating Costs

Lifetime

Discount

Rate

Energy Price Trend Lifetime Operating Costs Payback

Period Life

- Cycle Cost29 

# Operating Cost Calculation - Energy Use

• Energy Use Calculation and Inputs

– The annual unit e n ergy c onsumption ( kWh/ yr ) is calculated based on the following equation

UEC = ∆ PPPP 

### η fan × 

### η + L M 

### × OOOOOOOOOOOOOO



## – Op erating hours

• In dustrial sector: Data from 123 plant assessments

• C ommercial sector: Based on Energy Plus building simulation results

– L oad and Load profile

• Load is defined as the operating flow divided by the flow at BEP at a given

o perating speed

• Used a single average annual load point

– S peed: used four representative speeds (850, 1150, 1750, and 3550 RPM) to model the operating speeds in the field30 

# Operating Cost Calculation - Energy Use

• Set of representative units at 850 RPM for a given fan group (example)Pressure @ BEP



## Flow @ BEP 

# Fan Group #1 @ 850 RPM 

# Representative Unit Represents the “average” of all catalog models ( ) in each Power x Flow bin in terms of diameter, flow and pressure at BEP, fan curve and efficiency curve. Weighted by shipments based on the AMCA sales data31 

# Operating Cost Calculation - Energy Use

• Average a nnual e nergy u se by fan group for each considered standards case ( kWh )

Fan Group EL 0 EL 1 EL 2 EL 3 EL 4 EL 5 EL 6

Axial Housed 45,008 44,923 44,814 44,704 44,501 42,828 41,031

Axial Unhoused 15,598 15,597 15,597 15,594 15,592 15,438 15,050
Centrifugal Housed 68,839 68,802 68,713 68,554 68,406 66,945 65,754
Centrifugal Unhoused 33,256 33,219 33,156 33,126 33,064 32,305 31,864

Inline and Mixed Flow 23,312 23,300 23,259 23,227 23,197 22,807 22,402

Radial 49,346 49,182 48,892 48,555 48,232 46,369 43,936
Power Roof Ventilator 10,860 10,852 10,833 10,796 10,755 10,477 10,00732 

# Additional inputs to the Operating Cost Calculation

• Lifetimes

• Discount Rates

• Electricity Price and Electricity Price trend

– Derived from AEO 2014 (commercial and industrial prices) Fan Group Lifetime Mechanical Lifetime Hours of Operation
Axial Housed 28.8 163,281 6,428
Axial Unhoused 28.3 171,073 6,513 Centrifugal Housed 27.3 176,243 6,721 Centrifugal Unhoused 27.3 175,895 6,722

Inline and Mixed Flow 27.3 176,160 6,720
Radial 30.4 159,782 6,016
PRV 29.7 162,231 6,221

Sector Mean Standard Deviation

Commercial 5.1 % 1.3 %

Industrial 5.2 % 1.2 %33 

# Total Installed Costs Calculation

• The equipment prices are calculated both for baseline and higher efficiency equipment by

a pplying markups to manufacturer selling price

.

• Three main distribution channels (percentage units sold) :

• Distribution Channel markups:

– Overall baseline markup: MMMM OOOOOOOOOOOOOO

_ BB 

## = 1.73

– Overall incremental markup: MMMM OOOOOOOOOOOOOO

_ IIIIII 

## = 1.51 Equipment Classes Manufacturer - > OEM -> Distributor -> User Manufacturer - > Distributor

- > Contractor -> User Manufacturer - > Distributor

- > User
Axial Housed 47% 27% 26%

Axial Unhoused 34% 57% 9% Centrifugal Housed 32% 23% 45% Centrifugal Unhoused 40% 6% 54%

Inline and Mixed Flow 8% 85% 7%

Radial 5% 3% 92%

Power Roof Ventilator 5% 89% 6%
Total 28% 43% 29%34 

# Total Installed Costs Calculation

• B ase

- case equipment price calculation

BB 

## = MMMM BB 

## × MMMM OOOOOOOOOOOOOO

_ BB



## • Standards

- case equipment price calculation without inclusion of conversion costs

SSSSSS
, nn 

## = MMMM BB 

## × MMMM OOOOOOOOOOOOOO

_ BB 

## + ∆ MMMM BB 

## × MMMM OOOOOOOOOOOOOO

_ IIIIII



## • Adding the conversion costs:

– All consumers with a fan that would not meet the efficiency level considered would purchase a redesigned fan at a higher cost.

– Manufacturers recover the total conversion costs at each efficiency level

• Calculation of the conversion markup (across all bins within an fan group)



## MMMM

, 

## = TT TT EEEE 

### + TT TT RR RRRR RR RR FF FF

, EEEE 

### TT TT RR RRRR RR RR FF FF

, EEEE



### • Calculation of the s tandards

- case e quipment price (within one bin)

SSSSSS 

## = BBBBBB RR × 

## MMMM

, 

## − BBBBBB RR PP
, 

## BBBBBB UU FF
,35 

# Life Cycle Cost and Payback Period Analysis

• Average LCC and PBP Results for each Standards Case for Axial Housed Fans

TSL Efficiency Level Average Costs (2013$) Simple Payback
years Average Lifetime

years Installed Cost First Year’s Operating Cost Lifetime Operating Cost LCC

Base Case 4,766 3,258 46,954 51,721

-- 28.8

- 1 4,813 3,252 46,865 51,678 7.6 28.8

- 2 4,858 3,244 46,752 51,610 6.6 28.8

- 3 4,900 3,236 46,637 51,537 6.1 28.8

- 4 4,946 3,221 46,427 51,374 4.9 28.8

- 5 5,283 3,100 44,699 49,982 3.3 28.8

- 6 5,539 2,970 42,846 48,385 2.7 28.8
Note: The results for each TSL are calculated considering all customers. The PBP is measured relative to the base case

TSL Efficiency Level Life

- Cycle Cost Savings

% of Customers that Experience

Net Cost Average Savings* (2013$)

- 1 1.9 43

- 2 5.8 111

- 3 6.3 184

- 4 6.0 347

- 5 14.0 1,738

- 6 16.3 3,336 * The calculation includes customers with zero LCC savings (no impact) 

## • LCC Savings Relative to the Base Case Efficiency Distribution for A xial Housed Fans36 

# Life Cycle Cost and Payback Period Analysis

• Average LCC and PBP Results f or each Standards Case for Axial Unhoused Fans

TSL Efficiency Level Average Costs (2013$) Simple Payback
years Average Lifetime

years Installed Cost First Year’s Operating Cost Lifetime Operating Cost LCC

Base Case 1,207 1,676 23,770 24,976

-- 28.3

- 1 1,207 1,676 23,769 24,976 4.9 28.3

- 2 1,207 1,676 23,768 24,975 5.7 28.3

- 3 1,208 1,676 23,764 24,972 3.0 28.3

- 4 1,208 1,676 23,760 24,968 2.0 28.3

- 5 1,210 1,659 23,528 24,738 0.2 28.3

- 6 1,211 1,617 22,938 24,150 0.1 28.3
Note: The results for each TSL are calculated considering all customers. The PBP is measured relative to the base case

TSL Efficiency Level Life

- Cycle Cost Savings

% of Customers that Experience

Net Cost Average Savings* (2013$)

- 1 0.0 0.6

- 2 0.9 0.9

- 3 0.2 4

- 4 0.3 8

- 5 0.0 239

- 6 0.0 826 * The calculation includes customers with zero LCC savings (no impact) 

## • LCC Savings Relative to the Base Case Efficiency Distribution for A xial Unhoused Fans37 

# Life Cycle Cost and Payback Period Analysis

• Average LCC and PBP Results f or each Standards Case for Centrifugal Housed Fans

TSL Efficiency Level Average Costs (2013$) Simple Payback
years Average Lifetime

years Installed Cost First Year’s Operating Cost Lifetime Operating Cost LCC

Base Case 2,131 6,697 94,878 97,009

-- 27.3

- 1 2,172 6,693 94,820 96,992 10.1 27.3

- 2 2,226 6,685 94,694 96,920 7.4 27.3

- 3 2,273 6,669 94,467 96,740 4.9 27.3

- 4 2,324 6,654 94,257 96,581 4.4 27.3

- 5 2,654 6,512 92,228 94,882 2.8 27.3

- 6 2,870 6,396 90,596 93,467 2.5 27.3
Note: The results for each TSL are calculated considering all customers. The PBP is measured relative to the base case

TSL Efficiency Level Life

- Cycle Cost Savings

% of Customers that Experience

Net Cost Average Savings* (2013$)

- 1 3.6 17

- 2 3.1 89

- 3 5.0 269

- 4 7.2 428

- 5 17.4 2,127

- 6 19.9 3,543 * The calculation includes customers with zero LCC savings (no impact) 

## • LCC Savings Relative to the Base Case Efficiency Distribution for Ce ntrifugal Housed Fans38 

# Life Cycle Cost and Payback Period Analysis

• Average LCC and PBP Results f or each Standards Case for Centrifugal Unhoused Fans

TSL Efficiency Level Average Costs (2013$) Simple Payback
years Average Lifetime

years Installed Cost First Year’s Operating Cost Lifetime Operating Cost LCC

Base Case 1,678 3,495 49,652 51,330

-- 27.3

- 1 1,684 3,491 49,596 51,281 1.6 27.3

- 2 1,693 3,484 49,500 51,193 1.4 27.3

- 3 1,703 3,481 49,453 51,156 1.8 27.3

- 4 1,710 3,474 49,358 51,068 1.6 27.3

- 5 1,740 3,395 48,229 49,969 0.6 27.3

- 6 1,765 3,349 47,574 49,338 0.6 27.3
Note: The results for each TSL are calculated considering all customers. The PBP is measured relative to the base case

TSL Efficiency Level Life

- Cycle Cost Savings

% of Customers that Experience

Net Cost Average Savings* (2013$)

- 1 0.1 49

- 2 0.7 137

- 3 0.7 174

- 4 0.4 262

- 5 0.4 1,361

- 6 5.7 1,992 * The calculation includes customers with zero LCC savings (no impact) 

## • LCC Savings Relative to the Base Case Efficiency Distribution for Centrifugal Unhoused Fans39 

# Life Cycle Cost and Payback Period Analysis

• Average LCC and PBP Results f or each Standards Case for Inline and Mixed Flow Fans

TSL Efficiency Level Average Costs (2013$) Simple Payback
years Average Lifetime

years Installed Cost First Year’s Operating Cost Lifetime Operating Cost LCC

Base Case 2,206 2,436 34,710 36,915

-- 27.3

- 1 2,231 2,435 34,693 36,924 21.6 27.3

- 2 2,261 2,430 34,632 36,894 9.9 27.3

- 3 2,288 2,427 34,585 36,872 9.0 27.3

- 4 2,321 2,424 34,541 36,861 9.4 27.3

- 5 2,542 2,383 33,965 36,507 6.4 27.3

- 6 2,709 2,341 33,362 36,071 5.3 27.3
Note: The results for each TSL are calculated considering all customers. The PBP is measured relative to the base case

TSL Efficiency Level Life

- Cycle Cost Savings

% of Customers that Experience

Net Cost Average Savings* (2013$)

- 1 3.9 (8.7)

- 2 5.2 22

- 3 6.4 43

- 4 8.5 54

- 5 25.3 409

- 6 29.8 845 * The calculation includes customers with zero LCC savings (no impact) 

## • LCC Savings Relative to the Base Case Efficiency Distribution for Inline and Mixed Flow Fans40 

# Life Cycle Cost and Payback Period Analysis

• Average LCC and PBP Results f or each Standards Case for Radial Fans

TSL Efficiency Level Average Costs (2013$) Simple Payback
years Average Lifetime

years Installed Cost First Year’s Operating Cost Lifetime Operating Cost LCC

Base Case 1,550 3,581 52,081 53,631

-- 30.4

- 1 1,581 3,569 51,899 53,480 2.6 30.4

- 2 1,610 3,548 51,574 53,184 1.8 30.4

- 3 1,640 3,523 51,213 52,853 1.6 30.4

- 4 1,670 3,500 50,873 52,544 1.5 30.4

- 5 1,856 3,365 48,921 50,777 1.4 30.4

- 6 1,999 3,189 46,368 48,367 1.2 30.4
Note: The results for each TSL are calculated considering all customers. The PBP is measured relative to the base case

TSL Efficiency Level Life

- Cycle Cost Savings

% of Customers that Experience

Net Cost Average Savings* (2013$)

- 1 0.6 151

- 2 2.4 447

- 3 5.3 778

- 4 3.1 1,087

- 5 7.5 2,854

- 6 10.8 5,264 * The calculation includes customers with zero LCC savings (no impact) 

## • LCC Savings Relative to the Base Case Efficiency Distribution for R adial Fans41 

# Life Cycle Cost and Payback Period Analysis

• Average LCC and PBP Results f or each Standards Case for Power Roof Ventilator Fans

TSL Efficiency Level Average Costs (2013$) Simple Payback
years Average Lifetime

years Installed Cost First Year’s Operating Cost Lifetime Operating Cost LCC

Base Case 1,523 1,166 16,382 17,904

-- 29.7

- 1 1,529 1,165 16,370 17,900 8.4 29.7

- 2 1,537 1,163 16,340 17,877 4.8 29.7

- 3 1,543 1,159 16,285 17,828 3.0 29.7

- 4 1,551 1,155 16,223 17,773 2.5 29.7

- 5 1,593 1,125 15,805 17,398 1.7 29.7

- 6 1,621 1,074 15,098 16,719 1.1 29.7
Note: The results for each TSL are calculated considering all customers. The PBP is measured relative to the base case

TSL Efficiency Level Life

- Cycle Cost Savings

% of Customers that Experience

Net Cost Average Savings* (2013$)

- 1 0.6 4.7

- 2 2.3 28

- 3 1.8 77

- 4 2.1 131

- 5 6.3 506

- 6 2.7 1,185 * The calculation includes customers with zero LCC savings (no impact) 

## • LCC Savings Relative to the Base Case Efficiency Distribution for P ower Roof Ventilator Fans42 

# Topics

1. Introduction and Ru lemaking Background

2. Scope of the NODA

3. Metric Used in the NODA

4. Engineering A nalysis

5. Manufacturer Impact Analysis

6. Life C ycle Cost and Payback Period Analysis

7. National I mpact Analysis

8. Requests f or Comments43 

# Shipments and National Impact Analysis

• Shipments

– Projections based on the following indicators, depending on the market segment:

• Industrial sector: Fixed investments in equipment and structures including
f ans (0.32 percent compound annual growth rate)*

• Commercial s ector, new buildings: AEO new commercial floor space index (1.81 percent compound annual growth rate)*

• Commercial sector, existing buildings: Fix ed investments in existing structures including fans (2.14 percent compound annual growth rate)*

– This resulted in an ag gregate compound annual growth rate of 1.64 percent *

*Compound a nnual growth r ate over 2013

- 204844 

### National Full Fuel

- Cycle Energy Savings (quads)

Fan Group EL 1 EL 2 EL 3 EL 4 EL 5 EL 6*

Axial Housed 0.02 0.1 0.1 0.1 0.6 1.1

Axial Unhoused 0.00 0.00 0.00 0.01 0.2 0.8

Centrifugal Housed 0.03 0.1 0.2 0.3 1.5 2.5

Centrifugal Unhoused 0.02 0.1 0.1 0.1 0.5 0.8

Inline and Mixed Flow 0.00 0.01 0.02 0.03 0.1 0.2

Radial 0.1 0.2 0.3 0.5 1.3 2.4

Power Roof Ventilator 0.01 0.0 0.1 0.1 0.3 0.7

Total 0.2 0.4 0.8 1.2 4.6 8.4 

# Shipments and National Impact Analysis

• National Full Fuel

- Cycle Energy Savings (quads)

** EL 1, 2, 3, 4, 5, and 6 correspond to cutting off 5, 10, 15, 20, 50, and 70 % of models, respectively45 

# Shipments and National Impact Analysis

Fan Group Discount Rate (%) EL 1 EL 2 EL 3 EL 4 EL 5 EL 6**

Axial Housed 

### 3 0.07 0.17 0.28 0.49 2.27 4.24
7 0.02 0.05 0.08 0.15 0.72 1.36

Axial Unhoused 

### 3 0.003 0.004 0.02 0.04 0.97 3.33
7 0.001 0.001 0.01 0.01 0.33 1.14
Centrifugal Housed 

### 3 0.06 0.27 0.75 1.18 5.77 9.60
7 0.01 0.06 0.22 0.35 1.83 3.10
Centrifugal Unhoused 

### 3 0.09 0.23 0.29 0.44 2.29 3.36
7 0.03 0.08 0.10 0.15 0.79 1.15

Inline and Mixed Flow 

### 3 (0.003) 0.03 0.05 0.06 0.38 0.74
7 (0.004) 0.00 0.01 0.01 0.10 0.20

Radial 

### 3 0.28 0.79 1.39 1.96 5.23 9.61
7 0.09 0.25 0.45 0.64 1.71 3.16

Power Roof Ventilator 

### 3 0.01 0.07 0.18 0.30 1.16 2.68
7 0.003 0.02 0.05 0.09 0.37 0.88

Total 

### 3 0.5 1.6 3.0 4.5 18.1 33.6
7 0.1 0.5 0.9 1.4 5.8 11.0
* Note : Parentheses indicate negative values 

## • NPV of Consumer Benefits by Equipment Class (billion 2013 $)*

** EL 1, 2, 3, 4, 5, and 6 correspond to cutting off 5, 10, 15, 20, 50, and 70 % of models, respectively46 

# Topics

1. Introduction and Ru lemaking Background

2. Scope of the NODA

3. Metric Used in the NODA

4. Engineering A nalysis

5. Manufacturer Impact Analysis

6. Life C ycle Cost and Payback Period Analysis

7. National I mpact Analysis

8. Requests f or Comments47 

# Requests for Comment - 1

1. DOE g enerated formulae for manufacturer production cost (MPC) as a function of subgroup and diameter (which DOE believes can be used as a general proxy for airflow). DOE requests comments on whether there are any other parameters, such as pressure, construction class, rating RPM, etc., which DOE should use as inputs in calculating the MPC, in addition to or instead of diameter. If so, DOE encourages stakeholders to submit data illustrating the relationship of MPC with these parameters.

2. DOE a ssumed that the cost to redesign multiple fan models was equal to the number of models times an estimated cost to redesign one fan model. DOE recognizes that manufacturers may be able to share resources between redesigns in the same company, or in the same product line (i.e. different diameters). If this is current practice or possible, DOE requests comments on the scenarios in which resource sharing can occur and to
what extent.

3. DOE e stimated the cost to redesign a fan as a function of the subgroup of fan resulting from the redesign. There may be other parameters, such as the fan’s diameter, RPM properties, FEI or efficiency, or construction class, or the properties of the fan before it was redesigned, that DOE should take into consideration. If so, DOE requests information on which parameters should be taken into consideration and how each affects the cost to redesign a fan.

4. DOE u sed a redesign time of 6 months per fan model in its calculation of redesign costs. DOE requests comment on this assumption and whether this time period is sufficient for prototyping and the revision of marketing materials.48 

# Requests for Comment - 2

5. DOE did not explicitly consider fan noise performance in its analyses. DOE requests comment on whether

n oise considerations provide barriers to increased fan efficiencyas testedor as analyzed.

6. DOE requests information on the number of models and number of shipments of forward curved fans..

7. DOE requests comment on its use of a database of over 2500 fan models as approximately representing all fan

m odels in the scope of this rulemaking currently available in the United States today.

8. DOE used current subgroup distributions of fan models within each fan group at each efficiency level analyzed

t o weight the total conversion cost per model regardless of the efficiency level or the subclass of the fan model before redesign. In other words, DOE assumed that fan model impeller distributions at a given efficiency level would not change as a result of standards. DOE requests comment on this assumption.

9. DOE requests comment on the inclusion of t ubeaxial and vaneaxial fans into a single fan group separate from centrifugal inline and mixed flow fans. DOE requests information regarding whether these two groups of fans provide distinct utility that justifies the separation and resulting different FEIs for the same rated flow and

pressure.

10. DOE requests comment on the cost drivers included in the engineering analysis (i.e. aerodynamic redesign,

im peller type, and presence of guidevanes ).49 

# Requests for Comment - 3

11. DOE r equests information on the design and manufacturing differences between commercial and industrial
fans.

12. DOE r equests information on how forward curved impeller manufacturing differs from the manufacturing of other impeller types. DOE also requests comment on how other fan components differ between forward
curved models and non

- forward curved models, such as component materials and material gauges.

13. DOE r equests comment on its MPC as a function of diameter equation and multipliers.

14. DOE d id not consider variable pitch blades in its analysis. DOE requests information on the effect variable

- pitch blades have on efficiency in the field, the mechanism of that effect, and how testing can be conducted to capture any benefit from variable

- pitch blades.

15. DOE requests comment on any of the industry financials (working capital rate; net property, plant, and equipment rate; selling, general, and administrative expense rate; research and development rate; depreciation rate; capital expenditure rate, and tax rate) used in the GRIM (located in the “Financials” tab of the GRIM spreadsheet).50 

# Requests for Comment - 4

16. DOE r equests comment on the use of 11.4 percent as the real industry manufacturer discount rate (also referred to as the weighted average cost of capital) for commercial and industrial fan manufacturers (located in the “Financials” tab of the GRIM spreadsheet).

17. DOE r equests comment on the use of 1.45 as a manufacturer markup (this corresponds to a 31 percent gross margin) for all fan groups and efficiency levels in the base

- case (located in the “Markups” tab of the GRIM spreadsheet). DOE requests information regarding manufacturer markups and whether they vary by fan efficiency, fan group, fan subgroup, or any other attribute.

18. DOE r equests comment on both its methodology of calculating total industry capital and product conversion costs and the specific industry average per model capital and product conversion cost estimates for each fan subgroup (located in the Conversion Cost spreadsheet).

19. DOE a ssumed that every fan model that did not meet a candidate standard level being analyzed would be redesigned to meet that level. DOE requests comment on this assumption and on what portion of fan models that do not meet a standard level would be redesigned to meet the level versus dropped from the American
market.

20. DOE seeks inputs on its characterization of market channels for the considered fan groups, particularly related to whether the channels include all intermediate steps, and estimated market shares of each channel.51 

# Requests for Comment - 5

21. DOE seek s inputs and comments on the estimates of flow operating points used in the energy use analysis (expressed as a function of the flow at best efficiency point).

22. DOE s eeks inputs and comments on the estimates of annual operating hours by sector and application and on the estimated distributions of fans across sectors and applications.

23. DOE s eeks comments on its proposal to use a constant price trend for projecting future commercial and industrial fan prices.

24. DOE r equests comment on whether any of the efficiency levels considered in this analysis might lead to an increase in installation, repair, and maintenance costs, and if so, data regarding the magnitude of the increased cost for each relevant efficiency level.

25. DOE seek s comments on the proposal to use a compliance year of three years after the publication of the final
rule.

26. DOE seeks comments on the use of constant efficiency trends in the base

- case and in the standards

- cases.