ES-i 

EXECUTIVE SUMMARY

TABLE OF CONTENTS

ES.1 OVERVIEW OF PRELIMINARY ANALYSIS ACTIVITIES .......................................... 1

ES.2 OVERVIEW OF THE PRELIMINARY ANALYSIS AND THE TECHNICAL 

SUPPORT DOCUMENT ..................................................................................................... 3

ES.3 KEY RESULTS OF THE ANALYSIS ................................................................................ 4

ES.3.1 Market and Technology Assessment ...................................................................... 4

ES.3.2 Screening Analysis.................................................................................................. 6

ES.3.3 Engineering Analysis .............................................................................................. 7

ES.3.3.1 Equipment Classes Analyzed ................................................................... 7

ES.3.3.2 Manufacturing Cost Assessment.............................................................. 9

ES.3.3.3 Energy Consumption Model .................................................................... 9

ES.3.4 Markups to Determine Equipment Price ............................................................... 10

ES.3.5 Energy Use Analysis ............................................................................................. 12

ES.3.6 Life-Cycle Cost and Payback Period Analysis ..................................................... 12

ES.3.7 Shipments Analysis ............................................................................................... 18

ES.3.8 National Impact Analysis ...................................................................................... 20

ES.3.9 Preliminary Manufacturer Impact Analysis .......................................................... 24

ES.4 ISSUES ON WHICH DOE SEEKS PUBLIC COMMENT .............................................. 25

ES.4.1 Equipment Classes ................................................................................................ 25

ES.4.2 Test Procedure Issues ............................................................................................ 25

ES.4.3 Normalization Metrics .......................................................................................... 25

ES.4.4 Pull-Down Equipment .......................................................................................... 26

ES.4.5 Manufacturer Impact ............................................................................................. 26

ES.4.6 Share of Distribution Channels ............................................................................. 26

ES.4.7 Equipment Lifetimes ............................................................................................. 26

ES.4.8 Installation, Maintenance, and Repair Costs ......................................................... 27

ES.4.9 General Analytical Assumptions .......................................................................... 27

LIST OF TABLES

Table ES.3.1 Commercial Refrigeration Equipment Classes Established in the 2009 Final Rule . 5

Table ES.3.2 Proposed Classes for Commercial Refrigeration Equipment for which Standards 

Were Prescribed by the EPCA ........................................................................................................ 6

Table ES.3.3 Equipment Classes Analyzed and Representative Unit Sizes of Classes for which 

Standards Were Prescribed by EPCA ............................................................................................. 8

Table ES.3.4 Equipment Classes Analyzed and Representative Unit Sizes of Classes for which 

Standards were Established by the 2009 Final Rule ....................................................................... 8

Table ES.3.5 Manufacturing Cost and Energy Consumption Data for the VCT.SC.L Equipment 

Class .............................................................................................................................................. 10

Table ES.3.6 Distribution Channel Shares ................................................................................... 11

Table ES.3.7 Baseline Markups by Distribution Channel and Overall Weighted Average Markup, 

Including the Weighted Average Sales Tax Multiplier ................................................................ 11
ES-ii

Table ES.3.8 Incremental Markups by Distribution Channel and Overall Weighted Average 

Markup, Including the Weighted Average Sales Tax Multiplier .................................................. 11

Table ES.3.9 Inputs for LCC and PBP Analysis .......................................................................... 13

Table ES.3.10 Summary of Results of LCC and PBP Analysis for VCT.SC.L Equipment Class 16

Table ES.3.11 Mean LCC Savings for All Product Classes and Efficiency Levels ..................... 16

Table ES.3.12 Median Payback Period for All Product Classes and Efficiency Levels .............. 17

Table ES.3.13 Rebuttable Presumption Payback Periods by Efficiency Level and Equipment 

Class .............................................................................................................................................. 18

Table ES.3.14 Equipment Linear Dimensions Assumed for Shipments Analysis ....................... 19

Table ES.3.15 Percentage of Shipped Linear Feet of Commercial Refrigeration Equipment in the 

Year 2009 ...................................................................................................................................... 19

Table ES.3.16 Forecasted Shipments of New and Replacement Commercial Refrigeration 

Equipment by Building Type, 2016–2045 .................................................................................... 20

Table ES.3.17 Forecasted Shipment for Commercial Refrigeration Equipment by Equipment 

Class, 2016–2045 .......................................................................................................................... 20

Table ES.3.18 NES and NPV Inputs ............................................................................................ 21

Table ES.3.19 Cumulative National Energy Savings (quads) for All Efficiency Levels in All 

Equipment Classes Analyzed for Preliminary Analysis (2016−2045) ......................................... 22

Table ES.3.20 Cumulative NPV Results Based on a 7-Percent Discount Rate. ........................... 23

Table ES.3.21 Cumulative NPV Results Based on a 3-Percent Discount Rate (Billion 2010$) .. 24

LIST OF FIGURES

Figure ES.1.1 Flow Diagram of Analyses for the Commercial Refrigeration Equipment 

Rulemaking Process ........................................................................................................................ 2

Figure ES.3.1 LCC Savings Results for All the Efficiency Levels for the Equipment Class 

VCT.SC.L ..................................................................................................................................... 14

Figure ES.3.2 Payback Period Results for All Efficiency Levels for the Equipment Class 

VCT.SC.L ..................................................................................................................................... 15
ES-1 

EXECUTIVE SUMMARY

ES.1 OVERVIEW OF PRELIMINARY ANALYSIS ACTIVITIES

 The Energy Policy and Conservation Act of 1975, as amended (EPCA), requires the U.S.

Department of Energy (DOE) to establish energy conservation standards that achieve the 

maximum improvement in energy efficiency that is technologically feasible and economically 

justified. See 42 U.S.C. 6295(o)(3)(B). This executive summary provides an overview of the 

activities associated with the preliminary analysis that DOE conducted as part of the current

rulemaking to set energy conservation standards for commercial refrigeration equipment. The 

executive summary describes the preliminary analysis activities and summarizes key results from 

DOE’s analyses. Detailed analysis methodologies and results are presented in the preliminary 

analysis technical support document (TSD). Additionally, the executive summary identifies and 

lists the issues on which DOE requests comment from interested parties. These issues are 

highlighted in the public meeting presentation and discussed in detail in chapter 2 of the 

preliminary TSD.

 

Figure ES.1.1 presents a summary of the DOE rulemaking phases and the key analyses 

that constitute each phase. The rulemaking process typically begins with a framework document, 

which is followed by a preliminary analysis. DOE then publishes and seeks comment on a notice 

of proposed rulemaking (NOPR). After considering these comments and other relevant data and 

information, DOE publishes a final rule establishing any amended standards. The figure presents 

the major analyses in each phase in rectangular boxes. Core analyses for the rulemaking are lined 

in the center column of the figure, and they provide a logical sequence that DOE follows in 

carrying out the rulemaking process. Inputs to the analyses are shown with arrows pointing 

toward their respective analysis boxes, and outputs are shown with arrows directed away from 

their respective analysis boxes. Many outputs also form inputs for the downstream analyses. 

DOE obtains data for the inputs from various sources including, but not limited to, technical 

publications, market-survey reports, trade publications, interested parties’ comments, industry 

experts and consultants, interagency guidance, and interactions with end-users and the 

manufacturers. Key outputs from the analyses form the basis for setting the new energy 

conservation standards. 
ES-2 

Figure ES.1.1 Flow Diagram of Analyses for the Commercial Refrigeration Equipment 

Rulemaking Process

Utility Impact Analysis 

Notice of Proposed Rulemaking (NOPR)

Market and Technology

Assessment

Screening Analysis

Engineering Analysis

Markups for

Product Price

Determination Life-Cycle Cost and 

Payback Period 

Analysis

National Impact

Analysis

Energy Use

Revise Preliminary

Analysis

Life-Cycle Cost 

Sub-Group Analysis

Manufacturer Impact 

Analysis

Shipments

Analysis

Employment Impact

Analysis 

Revise Analyses

• Product Classes

• Technology Options

• Industry Cash Flow

• Sub-Group Cash-Flow

• Direct Employment Impacts

• Competitive Impacts

• Cumulative Regulatory Burden

• Cost-Efficiency Relationship

• Life-Cycle Costs and Savings

• Payback Periods

• National Energy Savings

• Net Present Values

• National Employment Impacts

• Revised Results

• Market Segmentation

• Non-Regulatory Programs

Framework Document

• Energy Prices

• Installation Costs

• Maintenance & Repair Costs

• Historic shipments

• New construction forecast

• Stakeholder Comments

• Demographics

• Emission Rates

• National Energy Savings

• Stakeholder Comments

• Identify Firms/Products 

• Historical Shipments

• Manufacturer Prices

• Average Costs

• Manufacturer Financial Data

Design Options

Product Classes

Retail Prices

Design Energy

Preliminary Analysis

• Efficiency/Performance

• Manufacturing Cost

Candidate

Standard 

Levels

Environmental

Assessment

Regulatory Impact

Analysis

Technology Options

• Emission Estimates

• Utility Load Factors

• National Energy Savings

• Non-Regulatory

Alternatives

• Design Options

• Energy Price Forecasts

• Site-to-Source Factors

• Energy-Efficiency Levels

Direct Employment 

Impacts

• National Energy Savings

• National Product Costs

• National Operating Costs

• Utility Impacts

• Life-Cycle Costs

• Payback Periods

• Installation

Costs

• Maint Costs • Repair Costs

• UEC

• Energy 

Prices

• Unit Energy Consumption 

(UEC)

Preliminary 

Manufacturer Impact 

Analysis

• Manufacturer Prices

• Average Costs

• Conversion Capital Expenditures

• Direct Employment Impacts

• National Energy Savings

• Net Present Values

• Trial Standard Levels (TSLs)

TSLs

• Product Prototypes

Energy-Efficiency 

Levels

• Department of Justice Review

Final Rule 

• Industry profit data

• Distribution channel shares
ES-3 

ES.2 OVERVIEW OF THE PRELIMINARY ANALYSIS AND THE TECHNICAL 

SUPPORT DOCUMENT

 For the preliminary analysis, DOE publishes a notice of public meeting (NOPM) in the 

Federal Register, which announces the availability of the preliminary TSD, the date and place of 

the public meeting, and presentation materials interested parties may review before the public 

meeting. In addition, the NOPM highlights the major analyses DOE developed in the preliminary 

analysis. 

 The preliminary TSD describes each preliminary analysis in detail, providing thorough 

descriptions of inputs, sources, methodologies, and results. Chapter 2 of the preliminary TSD 

provides an overview of each preliminary analysis, the comments received in response to the 

analytical approaches DOE described in the framework document, and DOE’s responses to those 

comments. The following chapters of the preliminary TSD address the preliminary analysis 

performed by DOE.

• A market and technology assessment (MTA) characterizes the relevant equipment 

markets and technology options, including prototype designs (chapter 3 of the 

preliminary TSD).

• A screening analysis reviews each technology option to determine whether it is 

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

adversely affect equipment utility or equipment availability; or would have adverse 

impacts on health and safety (chapter 4 of the preliminary TSD). 

• An engineering analysis develops cost-efficiency relationships that show a 

manufacturer’s cost of achieving increased efficiency. DOE uses manufacturer markups 

to convert manufacturer production cost (MPC) to manufacturer selling price (MSP) 

(chapter 5 of the preliminary TSD). 

• A markups analysis converts the manufacturer costs derived from the engineering 

analysis to consumer equipment prices (chapter 6 of the preliminary TSD).

• An energy use analysis determines the annual energy use in the field of the considered 

equipment (chapter 7 of the preliminary TSD). 

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

level, the discounted savings in operating costs throughout the estimated average life of 

the covered equipment, compared to any increase in the equipment’s installed cost likely 

to result directly from the imposition of a given standard (chapter 8 of the preliminary 

TSD).

• A shipments analysis forecasts shipments of equipment, which then are used to calculate 

the national impacts of standards on energy consumption, the net present value (NPV) of 

consumer costs and savings, and future manufacturer cash flows (chapter 9 of the 

preliminary TSD).
ES-4 

• A national impact analysis (NIA) assesses the cumulative national energy savings (NES) 

from standards and the NPV of consumer costs and savings associated with standards at 

different efficiency levels (chapter 10 of the preliminary TSD).

• A preliminary manufacturer impact analysis (MIA) assesses the potential impacts of 

energy conservation standards on manufacturers, such as effects on expenditures for 

capital conversion, marketing costs, shipments, and research and development costs 

(chapter 12 of the preliminary TSD). 

The remaining chapters of the preliminary TSD address the analyses to be performed for 

the NOPR stage:

• A life-cycle cost analysis for subgroups evaluates the effects of energy conservation 

standards on various national subgroups of the population (chapter 11 of the preliminary 

TSD).

• A utility impact analysis examines impacts of energy conservation standards on the 

generation capacity of electric utilities (chapter 13 of the preliminary TSD).

• An employment impact analysis examines the effects of energy conservation standards 

on national employment (chapter 14 of the preliminary TSD). 

• An environmental assessment examines the effects of energy conservation standards on 

various airborne emissions (chapter 15 of the preliminary TSD).

• A regulatory impact analysis examines the national impacts of non-regulatory alternatives 

to mandatory energy conservation standards (chapter 16 of the preliminary TSD). 

ES.3 KEY RESULTS OF THE ANALYSIS 

 The following sections describe in detail the key analyses DOE performed in support of 

the preliminary TSD.

ES.3.1 Market and Technology Assessment 

When initiating an analysis of potential energy efficiency standards for commercial 

equipment, DOE develops information for that equipment based on the present and past industry 

structure and market characteristics. This activity assesses industries and equipment both 

quantitatively and qualitatively, based on publicly available information. 

 When evaluating and establishing energy conservation standards, DOE divides covered 

equipment into classes by the type of energy used or by capacity or other performance-related 

feature that affects efficiency, when DOE determines that such feature justifies a different 

standard after considering such factors as utility to the consumer. (42 U.S.C. 6295(q)) Table 

ES.3.1 and Table ES.3.2 list the equipment classes being considered in this rulemaking. These 

consist of two subsets of equipment: (1) commercial refrigeration equipment for which standards 
ES-5 

were set by DOE in the 2009 final rule for commercial refrigeration equipment (74 FR 1092) 

and (2) equipment for which standards were prescribed by EPCA. 

Table ES.3.1 Commercial Refrigeration Equipment Classes Established in the 2009 Final 

Rule

Equipment Category Condensing 

Unit 

Configuration

Equipment Family Operating 

Temperature 

°F

Equipment 

Class 

Designation

Remote Condensing 

Commercial Refrigerators, 

Commercial Freezers, and 

Commercial RefrigeratorFreezers*

Remote Vertical Open ≥ 32 VOP.RC.M

< 32 VOP.RC.L

Semivertical Open ≥ 32 SVO.RC.M

< 32 SVO.RC.L

Horizontal Open ≥ 32 HZO.RC.M

< 32 HZO.RC.L

Vertical Closed Transparent ≥ 32 VCT.RC.M

< 32 VCT.RC.L

Horizontal Closed Transparent ≥ 32 HCT.RC.M

< 32 HCT.RC.L

Vertical Closed Solid ≥ 32 VCS.RC.M

< 32 VCS.RC.L

Horizontal Closed Solid ≥ 32 HCS.RC.M

< 32 HCS.RC.L

Service Over Counter ≥ 32 SOC.RC.M

< 32 SOC.RC.L

Self-Contained Commercial 

Refrigerators, Commercial 

Freezers, and Commercial 

Refrigerator-Freezers* without 

Doors

Self-Contained Vertical Open ≥ 32 VOP.SC.M

< 32 VOP.SC.L

Semivertical Open ≥ 32 SVO.SC.M

< 32 SVO.SC.L

Horizontal Open ≥ 32 HZO.SC.M

< 32 HZO.SC.L

Commercial Ice-Cream 

Freezers

Remote Vertical Open ≤ -5 VOP.RC.I

Semivertical Open SVO.RC.I

Horizontal Open HZO.RC.I

Vertical Closed Transparent VCT.RC.I

Horizontal Closed Transparent HCT.RC.I

Vertical Closed Solid VCS.RC.I

Horizontal Closed Solid HCS.RC.I

Service Over Counter SOC.RC.I

Self-Contained Vertical Open VOP.SC.I

Semivertical Open SVO.SC.I

Horizontal Open HZO.SC.I

Vertical Closed Transparent VCT.SC.I

Horizontal Closed Transparent HCT.SC.I

Vertical Closed Solid VCS.SC.I

Horizontal Closed Solid HCS.SC.I

Service Over Counter SOC.SC.I * While DOE did not establish separate equipment classes for refrigerator-freezers in the 2009 final rule, DOE did provide a 

methodology for applying standards to commercial refrigerator-freezers in the rule. Please see 10 CFR 431.66.

 
ES-6 

Table ES.3.2 Proposed Classes for Commercial Refrigeration Equipment for which 

Standards Were Prescribed by the EPCA 

Equipment Category Condensing 

Unit 

Configuration

Equipment Family Operating 

Temperature 

°F

Equipment 

Class 

Designation

Commercial Refrigerators, 

Commercial Freezers, and 

Commercial RefrigeratorFreezers With Doors

Self-Contained Vertical Closed Transparent ≥ 32 VCT.SC.M

< 32 VCT.SC.L

Horizontal Closed Transparent ≥ 32 HCT.SC.M

< 32 HCT.SC.L

Vertical Closed Solid ≥ 32 VCS.SC.M

< 32 VCS.SC.L

Horizontal Closed Solid ≥ 32 HCS.SC.M

< 32 HCS.SC.L

Service Over Counter ≥ 32 SOC.SC.M

< 32 SOC.SC.L

Commercial Refrigerators with 

Transparent Doors for 

Pull-Down Temperature 

Applications

Self-Contained Pull-Down ≥ 32 PD.SC.M

 For the commercial refrigeration equipment addressed by this rulemaking, DOE 

examined (1) manufacturer market share and characteristics; (2) existing regulatory and nonregulatory initiatives for improving equipment efficiency; and (3) trends in equipment 

characteristics and retail markets. This information provided data and resource material 

throughout the analysis. 

DOE reviewed literature and interviewed manufacturers to develop an overall 

understanding of the commercial refrigeration equipment industry in the United States. Chapter 3 

of the preliminary TSD describes the market analysis and resulting information.

 DOE typically uses information about existing and past technology options and prototype 

designs to determine which technologies and combinations of technologies manufacturers use to 

attain higher energy-efficiency levels. In consultation with interested parties, DOE develops a list 

of technologies to be considered. 

DOE developed its list of technologies for commercial refrigeration equipment after 

examining various documents (e.g., trade publications, technical papers, and manufacturer 

literature) and consulting with manufacturers. Because existing equipment contains many 

technologies for improving equipment efficiency, equipment literature and direct examination 

provided additional information. 

ES.3.2 Screening Analysis

 In the screening analysis, DOE, in consultation with interested parties, examined the 

technologies identified in the MTA. DOE first examined whether it was possible to test the 

energy efficiency of these technologies. DOE is conducting a separate rulemaking to consider 

amending the current test procedure for commercial refrigeration equipment (EERE-2010-BTTP-0034). DOE expects that any amended test procedure would be used to determine compliance 

with any revised energy conservation standards. DOE published a NOPR proposing to amend the 
ES-7 

current DOE test procedure. 75 FR 51596 (Nov. 24, 2010). The screening analysis for the energy 

conservation standard used the proposed test procedure to assess which technologies could be 

quantified by the test procedure. At this time, DOE is not further considering those technologies 

whose impact on energy efficiency cannot be measured using the proposed test procedure. 

 Second, DOE evaluated the technologies using four screening criteria. Technologies are 

removed from further consideration if they (1) are not technologically feasible; (2) are not 

practicable to manufacture, install, and service; (3) have an adverse impact on equipment utility 

or availability; and/or (4) have adverse impacts on health and safety. In the subsequent 

engineering analysis, DOE further examines the technology options that are not removed from 

consideration in the screening analysis. 

ES.3.3 Engineering Analysis 

In the engineering analysis (chapter 5 of the preliminary analysis TSD), DOE establishes 

the relationship between the cost of manufacturing commercial refrigeration equipment and the 

energy consumption of this equipment. This relationship serves as the basis for calculating costs 

and benefits of modified equipment designs for consumers, manufacturers, and the nation. 

Chapter 5 of the preliminary analysis TSD describes the equipment classes that DOE analyzed, 

the representative baseline units, the efficiency levels DOE considered, the methodology that 

DOE used to develop the manufacturing production cost and energy consumption models, and 

the cost-efficiency results.

ES.3.3.1 Equipment Classes Analyzed

 There are 49 proposed equipment classes for commercial refrigeration equipment. The 

engineering analysis is based on the direct analysis of 24 primary equipment classes. These 

classes comprise the primary classes included in the analysis for DOE’s 2009 final rule, as well 

as new classes covering selected equipment for which standards were prescribed in EPCA. For 

the remaining 25 equipment classes (secondary classes), standard levels will be developed 

through extension of the standard levels set for the primary classes. 

For each of the primary equipment classes selected for analysis, DOE also selected a 

representative unit size to constitute the analysis point for that class. Table ES.3.3 and Table 

ES.3.4 show the primary classes selected for analysis, as well as the representative sizes selected 

for each class. Chapter 5 of the preliminary TSD includes additional details on the representative 

equipment classes and the cost-efficiency curves developed as part of the engineering analysis.
ES-8 

Table ES.3.3 Equipment Classes Analyzed and Representative Unit Sizes of Classes for 

which Standards Were Prescribed by EPCA

Equipment 

Family

Condensing 

Unit Type

Rating 

Temperature

Equipment 

Class 

Designation

Representative 

Case Length

ft

Representative 

Gross 

Refrigerated 

Case Volume 

ft3

Representative 

Case Total 

Display Area 

ft2

Vertical 

Closed 

Transparent

SelfContainedM (38 °F) VCT.SC.M 4.5 49.0 20.7

L (0 °F) VCT.SC.L 4.5 49.0 20.7

Vertical 

Closed Solid

SelfContainedM (38 °F) VCS.SC.M 4.5 49.0 0.0

L (0 °F) VCS.SC.L 4.5 49.0 0.0

Horizontal 

Closed 

Transparent

SelfContainedM (38 °F) HCT.SC.M 3.8 8.83 7.7

L (0 °F) HCT.SC.L 3.8 8.83 7.7

Horizontal 

Closed Solid

SelfContainedM (38 °F) HCS.SC.M 4.2 7.03 0.0

L (0 °F) HCS.SC.L 4.2 7.03 0.0

Pull-Down SelfContained M (38 °F) PD.SC.M 2.5 27.0 11.6

Table ES.3.4 Equipment Classes Analyzed and Representative Unit Sizes of Classes for 

which Standards were Established by the 2009 Final Rule 

Equipment 

Family

Condensing 

Unit Type

Rating 

Temperature

Equipment 

Class 

Designation

Representative 

Case Length 

ft

Representative 

Gross 

Refrigerated 

Case Volume 

ft3

Representative 

Case Total 

Display Area 

ft2

Vertical 

Open

Remote 

Condensing

M (38 °F) VOP.RC.M 12.0 130.2 53.3

L (0 °F) VOP.RC.L 12.0 109.8 44.7

SelfContained M (38 °F) VOP.SC.M 4.0 32.0 14.9

SemiVertical 

Open

Remote 

Condensing M (38 °F) SVO.RC.M 12.0 46.6 40.0

SelfContained M (38 °F) SVO.SC.M 4.0 9.4 12.8

Horizontal 

Open

Remote 

Condensing

M (38 °F) HZO.RC.M 12.0 33.0 33.0

L (0 °F) HZO.RC.L 12.0 55.0 46.0

SelfContained

M (38 °F) HZO.SC.M 4.0 7.5 12.0

L (0 °F) HZO.SC.L 4.0 7.4 12.0

Vertical 

Closed 

Transparent

Remote 

Condensing

M (38 °F) VCT.RC.M 12.7 142.0 65.0

L (0 °F) VCT.RC.L 12.7 133.5 65.0

SelfContained I (-15 °F) VCT.SC.I 4.3 48.0 26.0

Vertical 

Closed 

Solid

SelfContained I (-15 °F) VCS.SC.I 4.3 48.0 0.0

Horizontal 

Closed 

Transparent

SelfContained I (-15 °F) HCT.SC.I 3.4 10.2 5.1

Service 

Over 

Counter

Remote 

Condensing M (38 °F) SOC.RC.M 12.0 66.0 51.0
ES-9 

ES.3.3.2 Manufacturing Cost Assessment

DOE estimated the manufacturing costs associated with each engineering design option 

level for all of the equipment classes analyzed, including primary and secondary equipment 

classes. The assessment method used information gained during manufacturer site visits and 

manufacturer interviews; information gathered by DOE in previous energy conservation 

standards rulemakings covering equipment manufactured using similar manufacturing methods; 

and a detailed cost model. Using aggregated manufacturer data, DOE developed the 

manufacturing cost model to estimate the MPC for various design option configurations. DOE 

obtained additional input from interested parties on the manufacturing cost model inputs. DOE 

also estimated the manufacturer markup and the MSP, which includes the shipping cost (the cost 

of shipping the equipment from the manufacturer to the distributor or customer). DOE calculated 

the MSP as the product of the MPC and the manufacturer markup, plus the shipping cost. 

Chapter 5 of the preliminary TSD includes information on the inputs used to determine the 

manufacturing cost, including material, labor, and overhead costs. Chapter 5 also includes 

information on the various components and features incorporated into designs for commercial 

refrigeration equipment. 

ES.3.3.3 Energy Consumption Model

The complementary analysis to the manufacturing cost model is the energy consumption 

model. This model calculates energy consumption in two major subsections: compressor and 

component energy consumption. Component energy consumption is the sum of all electrical 

energy used directly by each fan motor, lamp, defrost or drain heater, anti-sweat heater, or other 

energy-consuming system component. Compressor energy consumption is calculated from the 

total heat load to be removed from the refrigerated space, and scaled to characterize 

representative compressor performance using one of two compressor models, either for remote 

condensing equipment or for self-contained equipment. The total heat load is the sum of the heat 

emitted by electrical-energy-consuming components inside the refrigerated space and the heat 

contributed by radiation through glass and openings, conduction through walls and doors, and 

warm air infiltration through openings. The energy consumption model calculates daily energy 

use for a unit based on a given design option configuration and numerical specifications designed 

to model the conditions at which a unit would be physically tested. 

 

DOE’s engineering analysis produced cost-efficiency curves for the 24 primary 

commercial refrigeration equipment classes. The cost-efficiency curves are described by (1) the 

energy consumption values that were calculated based on modeling the corresponding equipment 

configuration and (2) the increase in MPC and MSP associated with each of the calculated levels. 

An example of a cost-efficiency curve is illustrated in Table ES.3.5 for the equipment class 

VCT.SC.L. Table ES.3.5 presents the energy consumption, MPC, and MSP results as well as the 

ordering of design options for the VCT.SC.L equipment class, a high-shipment equipment class 

used in many applications. Cost-efficiency curves for all 24 equipment classes analyzed can be 

found in chapter 5 of the preliminary TSD. 
ES-10

Table ES.3.5 Manufacturing Cost and Energy Consumption Data for the VCT.SC.L 

Equipment Class

Design 

Option

Level

Calculated Daily

Energy 

Consumption 

kWh/day*

Manufacturer

Production Cost 

$

Manufacturer

Selling Price 

$

Design Option Added 

Above the Baseline

AD1 32.70 2,420.52 3,425.52 Baseline

AD2 31.35 2,428.52 3,436.64 AD1 + Permanent Split Capacitor 

Evaporator Fan Motor

AD3 29.90 2,437.67 3,449.36 AD2 + High-Efficiency 

Reciprocating Compressor

AD4 28.32 2,454.67 3,472.99 AD3 + Brushless DC Evaporator 

Fan Motor

AD5 20.95 2,566.33 3,628.20 AD4 + High-Performance Door

AD6 20.04 2,594.91 3,667.92 AD5 + Enhanced Evaporator Coil

AD7 15.47 2,767.41 3,907.70 AD6 + Light-Emitting Diode 

(LED) Lighting

AD8 15.18 2,782.87 3,929.19 AD7 + Additional 1/2” Insulation 

Thickness

AD9 13.91 2,876.11 4,058.79 AD8 + Enhanced Condenser Coil

AD10 13.81 2,885.11 4,071.30 AD9 + Permanent Split Capacitor 

Condenser Fan Motor

AD11 13.70 2,899.61 4,091.46 AD10 + Brushless DC Condenser 

Fan Motor

AD12 13.08 2,987.11 4,213.08 AD 11 + LED Lighting with 

Occupancy Sensors

AD13 12.47 3,414.01 4,806.47 AD 12+ Vacuum Insulated Panels

* kWh = kilowatt-hours 

ES.3.4 Markups to Determine Equipment Price

 Markups are multipliers that convert the MPC into customer purchase price. 

Manufacturer markups convert the MPC into MSP. Additional markups are applied to the MSP 

based on the distribution channel through which customers purchase the equipment. DOE 

identified that commercial refrigeration equipment is purchased by the customers (end-users) 

through three major distribution channels: 

Manufacturer  Wholesaler  Mechanical Contractor  Customer (Contractor Channel) 

Manufacturer  Wholesaler  Customer (Wholesaler Channel) 

Manufacturer  Customer (National Account Channel) 

Table ES.3.6 shows the share of each distribution channel used by DOE. 
ES-11

Table ES.3.6 Distribution Channel Shares

National 

Account 

Channel

Wholesaler 

Channel

Contractor 

Channel

Remote 

Condensing 

Equipment

70% 15% 15%

Self-Contained 

Equipment 30% 60% 10%

 There is one markup value associated with each level in a distribution channel. The 

product of all the markups in one distribution channel gives the overall markup of that channel. 

For example, the wholesaler channel markup is a product of national account markup and 

wholesaler markup. DOE obtained one average markup value for each level of a distribution 

channel to calculate the overall markup. These values were then weighted by the respective 

distribution channel shares to obtain an overall markup. DOE calculated separate markups called 

“baseline markups” that are applied to the baseline equipment price and “incremental markups” 

that are applied to cost increments in the manufacturer selling price for higher efficiency 

equipment. 

Sales tax is one additional markup that is applicable to all the distribution channels. DOE 

calculated a weighted national average sales tax rate of 7.25 percent by applying the population 

of a state as the weight to its combined state and local tax rate. Table ES.3.7 and Table ES.3.8

present calculated overall weighted markups as well as individual markups for each level in a 

distribution channel. 

 Chapter 6 and appendix 6A of the preliminary analysis TSD provide additional details for 

the markups analysis. 

Table ES.3.7 Baseline Markups by Distribution Channel and Overall Weighted Average 

Markup, Including the Weighted Average Sales Tax Multiplier

Wholesaler Contractor National 

Account

Overall Markup

Remote 

Condensing

SelfContained

Markup 1.362 2.004 1.181 1.332 1.372

Sales Tax 1.073 1.073 1.073 1.073 1.073

Overall 

Markup 1.461 2.150 1.267 1.429 1.472

Table ES.3.8 Incremental Markups by Distribution Channel and Overall Weighted 

Average Markup, Including the Weighted Average Sales Tax Multiplier

Wholesaler Contractor National 

Account

Overall Markup

Remote

Condensing

SelfContained

Markup 1.091 1.300 1.046 1.091 1.098

Sales Tax 1.073 1.073 1.073 1.073 1.073

Overall 

Markup 1.171 1.395 1.122 1.170 1.179
ES-12

ES.3.5 Energy Use Analysis 

Energy use analysis is generally carried out for appliance standards rulemakings to calculate the 

energy consumption or efficiency of the equipment being analyzed. For commercial refrigeration

equipment, DOE calculated the energy consumption of the equipment as part of the engineering 

analysis using an energy consumption model. During the 2009 final rule analysis, DOE 

conducted an energy use analysis and concluded that the analysis results agreed reasonably well 

with those calculated by the energy consumption model used in the engineering analysis. For the 

current rulemaking, DOE retained the 2009 final rule analysis conclusions and used the energy 

consumption model results from the engineering analysis as inputs into the LCC and PBP 

analysis and NIA. 

 Interested parties commented during the Framework public meeting that self-contained 

equipment may have a significant impact on the building’s heating, ventilation, and airconditioning (HVAC) loads because, unlike the display cases connected to a remote condensing 

unit, this equipment rejects heat inside the building. DOE evaluated the effect of efficiency 

improvements in self-contained equipment on building HVAC loads by simulating a selfcontained freezer in restaurant buildings. Typically, the energy consumption of a self-contained 

freezer was found to be less than 3 percent of the total restaurant building energy consumption. 

By comparing the evaluations with baseline and with higher efficiency level equipment, DOE 

found the effect on building heating and cooling loads to be negligible. Based on these 

evaluations, DOE believes that the effect of efficiency improvements in self-contained 

commercial refrigeration equipment on building heating and cooling load is insignificant, 

consistent with its findings in the 2009 rulemaking. 

 

ES.3.6 Life-Cycle Cost and Payback Period Analysis 

LCC and PBP analysis is carried out by DOE to estimate the impact of standards on the 

customers (end-users) of commercial refrigeration equipment. The effect of standards on 

individual customers includes a change in operating cost (usually decreased) and a change in 

purchase cost (usually increased). LCC is the total customer cost of the equipment over the entire 

lifetime of the equipment. It includes installed cost (purchase price and installation costs) and 

operating cost (maintenance, repair, and energy costs). Typically, the initial cost of more 

efficient equipment is higher than the baseline equipment, but the annual operating costs are 

lower, mainly due to lower energy consumption. PBP for higher-efficiency equipment 

(compared to baseline equipment) can be calculated by dividing the installed cost increment by 

the annual operating cost savings. In other words, PBP is the amount of time (in years) required 

to offset the initial increase in installed costs through annual savings in operating costs.

 In conducting the LCC and PBP analysis, DOE analyzed up to eight efficiency levels 

from among the engineering design option levels. The MSP and equipment energy consumption 

values, in kilowatt-hours per day, were obtained from the engineering analysis. Inputs for the 

LCC and PBP analysis are summarized in Table ES.3.9. To account for the uncertainty 

associated with many of the inputs in the LCC and PBP analysis, DOE carried out the analysis in 

the form of Monte Carlo simulations that use a distribution of values for certain inputs, instead of 

assuming one average value. Equipment lifetime is assumed to be represented by Weibull 
ES-13

distributions with average values of 10 or 15 years. Building type and the state where the 

equipment is installed is another variable in the simulations.

Table ES.3.9 Inputs for LCC and PBP Analysis 

Input Description

Building Type Discount rates and electricity prices will vary by building type in which the 

equipment is installed. Seven building types are assumed for commercial 

refrigeration equipment: (1) supermarkets; (2) wholesaler/retailer multi-line stores, 

such as “big-box,” “warehouse,” and “supercenters;” (3) convenience and small 

specialty stores, such as meat markets, wine, beer, and liquor stores; (4) convenience 

stores associated with gasoline stations; (5) full service restaurants; (6) limited 

service restaurants; and (7) other. 

Inputs for Installed Cost Calculations

Baseline MSP MSP of baseline equipment (obtained from engineering analysis).

Efficiency Level MSP 

Increases

Difference between baseline MSP and MSP of higher efficiency level (obtained 

from engineering analysis).

Markups and Sales Tax Converts MSP to customer purchase price (obtained from markups analysis).

Installation Price Material and labor cost to install the equipment. Assumed constant for all efficiency 

levels within an equipment class. Varies by state.

Inputs for Operating Cost Calculations

Equipment Energy 

Consumption

Energy used by equipment in kilowatt-hours per day (obtained from engineering 

analysis).

Electricity Prices Vary by state and building type associated with the equipment.

Maintenance Costs Material and labor costs for preventative maintenance (assumed constant for all 

efficiency levels within an equipment class) and lighting maintenance (varies by the 

original equipment manufacturer [OEM] cost of lighting). 

Repair Costs Material and labor cost to repair and replace failed components in the equipment. 

Varies with the OEM cost of the failed components.

Equipment Lifetime Assumed average lifetime of the equipment: 10 years for all foodservice installations 

and large retail stores, and 15 years for small retail stores. Actual lifetimes used in 

the LCC analysis represented by Weibull distributions.

Discount Rate Rate at which future costs are discounted to establish their present value. This varies 

with building type.

 DOE notes that manufacturers will need to comply with the efficiency levels set by the 

2009 final rule on January 1, 2012. The market technology level will be altered in 2012 when 

compliance with the 2009 final rule standards is required. Therefore, the current market baseline 

obtained from the engineering analysis does not represent the market baseline in 2016, when any 

amended standards prescribed by the current rulemaking could go into effect. (DOE notes that 

EPCA provides for a 3-year transition period between publication of any amended standards and 

the compliance date and permits an extension of 2 years if the 3-year period is determined by 

DOE to be inadequate. (42 U.S.C. 6313(c)(5)(C)) To estimate the market technology level in 

2016, DOE introduced a baseline level termed the “standards baseline.” The energy consumption 

of the standards baseline level of an equipment class is equal to the standard prescribed by the 

2009 final rule for that equipment class. DOE inserted the standards baseline into the engineering 

design option levels by placing it at the appropriate level based on the energy consumption of the 

standards baseline. The design option levels that are less efficient than the standards baseline are 

disregarded and the more efficient design option levels are carried forward for downstream 

analyses. A detailed description of this procedure is presented in chapter 8 of the preliminary 

analysis TSD.
ES-14

 The output of the Monte Carlo simulations for the LCC and PBP analysis are in the form 

of distributions. The LCC savings and PBP results for all the efficiency levels in each equipment 

class are presented in the preliminary analysis TSD (appendix 8B) and shown here, as an 

example for equipment class VCT.SC.L, in Figure ES.3.1 and Figure ES.3.2, respectively. The 

plots in both figures present the mean (red marker) and median (blue marker) LCC savings or 

PBP, the 25th and 75th percentile LCC savings or PBP (lower and upper edges of the elongated 

rectangular box, respectively), and 5th and 95th percentile LCC savings or PBP (lower and upper 

ends of the vertical black line, respectively). 

Figure ES.3.1 LCC Savings Results for All the Efficiency Levels for the Equipment Class 

VCT.SC.L

-1000

0

1000

2000

3000

4000

5000

6000

7000

8000

9000

1 2 3 4 5 6 7 8

Life-cycle Cost Savings ($)

Efficiency Level

Mean

Median

`
ES-15

Figure ES.3.2 Payback Period Results for All Efficiency Levels for the Equipment Class 

VCT.SC.L

Appendix 8B also contains summary tables for each equipment class, similar to Table ES.3.10

for equipment class VCT.SC.L (presented here as an example). This table presents the mean 

values of installed costs, annual operating costs, LCC, LCC savings, and median PBP values for 

all the efficiency levels. It also presents the percentage of customers who experience net cost, no 

impact, and net benefit. The average LCC savings and the percentage of customers experiencing 

a net benefit or cost are based on a distribution of efficiency choices. In the base case, not all 

customers are assumed to be buying equipment at the baseline efficiency (level 1). Some are 

assumed to be buying at higher efficiency levels. The LCC savings is an average of the savings 

achieved by customers who, in the base case, were buying less efficient equipment than the 

efficiency level examined. Customers with no impact were assumed in the base case to be 

already buying more efficient equipment, so the efficiency level in question would not affect 

them.

Table ES.3.11, Table ES.3.12, and Table ES.3.13 present the mean values of LCC 

savings, median PBP, and median “rebuttable presumption payback period” (RPBP) results for 

each efficiency level in each equipment class. RPBP is a special PBP case calculated to 

determine whether the rebuttable presumption set forth in EPCA is satisfied. RPBP values are

calculated by dividing the installed cost increment of higher efficiency equipment by only the 

first-year energy savings (unlike total operating cost savings for PBP). EPCA provides that if the 

additional cost to the consumer of purchasing a product compliant with any amended standard is 

less than three times the value of the energy savings during the first year, there shall be a 

rebuttable presumption that such standard is economically justified. (42 U.S.C. 6295(o)(2)(B)(iii) 

and 42 U.S.C. 6316(e)(1)) However, in addition to presenting the RPBP values, DOE routinely 

conducts a full economic analysis that considers the full range of impacts, including those 

0.0

1.0

2.0

3.0

4.0

1 2 3 4 5 6 7 8

Payback Period (Years)

Efficiency Level

Mean

Median
ES-16

affecting the customer, manufacturer, nation, and environment, as required under 42 U.S.C 

6295(o)(2)(B)(i) and 42 U.S.C. 6316(e)(1).

Table ES.3.10 Summary of Results of LCC and PBP Analysis for VCT.SC.L Equipment 

Class

Efficiency 

Level

Energy 

Consumption 

kWh/yr

2010$ Life-Cycle Cost Savings Payback 

Period years

Installed 

Cost

Total 

Discounted 

Operating 

Cost

LCC Affected 

Customers’ 

Average 

Savings

2010$

% of Customers that 

Experience

Median

Net

Cost

No 

Impact

Net 

Benefit

1 11,936 5,922 13,685 19,607 NA NA NA NA NA 

2 11,441 5,935 13,229 19,163 445 0 87 13 0.28 

3 10,335 5,977 12,213 18,190 1,195 0 74 26 0.38 

4 7,314 6,207 9,390 15,598 3,369 0 60 40 0.66 

5 5,645 6,490 7,735 14,225 3,802 0 45 55 0.94 

6 5,042 6,682 7,184 13,866 3,357 0 30 70 1.15 

7 4,773 6,849 6,938 13,788 2,904 2 17 81 1.35 

8 4,550 7,548 6,729 14,277 2,064 34 5 61 2.30 

 

Table ES.3.11 Mean LCC Savings for All Product Classes and Efficiency Levels

Product 

Class

Mean LCC Savings 

2010$

Level 2 Level 3 Level 4 Level 5 Level 6 Level 7 Level 8

VOP.RC.M $201.55 $145.93 $379.23 ($3,438.55) ($4,529.45) NA NA

VOP.RC.L $411.97 $24.63 ($1,610.83) NA NA NA NA

VOP.SC.M $232.60 $131.23 ($1,102.01) ($1,421.46) NA NA NA

VCT.RC.M $341.55 $218.67 $1,297.73 $998.48 ($502.38) NA NA

VCT.RC.L $847.39 $455.81 ($1,221.18) NA NA NA NA

VCT.SC.M $146.81 $1,315.37 $966.02 $812.52 $672.79 $570.17 $88.99 

VCT.SC.L $444.81 $1,195.16 $3,368.86 $3,801.92 $3,357.46 $2,904.46 $2,064.28 

VCT.SC.I $332.51 $558.63 $442.49 $351.23 $369.80 $322.39 ($381.56)

VCS.SC.M $209.90 $349.85 $280.18 $243.57 $257.95 $263.57 ($159.66)

VCS.SC.L $358.85 $589.99 $523.52 $492.46 $489.30 $531.32 $38.28 

VCS.SC.I $193.02 $167.14 $127.07 $107.06 ($530.57) NA NA

SVO.RC.M $126.46 $298.65 $229.46 ($2,635.87) ($3,299.76) NA NA

SVO.SC.M $132.65 $64.99 ($935.87) ($1,125.34) NA NA NA

SOC.RC.M $8.55 $83.82 $63.29 ($1,471.64) ($1,521.85) ($1,964.42) NA

HZO.RC.M ($372.75) NA NA NA NA NA NA

HZO.RC.L $25.97 ($1,005.84) NA NA NA NA NA

HZO.SC.M ($273.99) NA NA NA NA NA NA

HZO.SC.L ($317.24) NA NA NA NA NA NA

HCT.SC.M $65.58 $57.32 $348.69 $287.76 $237.02 $46.71 NA

HCT.SC.L $194.09 $154.85 $1,145.59 $892.04 $726.62 $479.49 NA

HCT.SC.I $26.39 $31.82 $51.55 ($198.91) NA NA NA

HCS.SC.M $7.99 $11.74 $6.52 ($4.28) ($126.60) NA NA

HCS.SC.L $39.23 $69.44 $87.73 $118.12 $58.83 NA NA

PD.SC.M $614.02 $752.94 $526.82 $433.74 $368.06 $271.13 ($83.73)

* NA means no LCC savings were calculated for this efficiency level because no design options were available to constitute an 

efficiency level.
ES-17

Table ES.3.12 Median Payback Period for All Product Classes and Efficiency Levels

Product 

Class

Median Payback Period* 

years

Level 2 Level 3 Level 4 Level 5 Level 6 Level 7 Level 8

VOP.RC.M 1.68 1.98 3.70 40.90 46.77 NA NA

VOP.RC.L 2.86 7.48 14.68 NA NA NA NA

VOP.SC.M 4.50 4.80 29.54 33.97 NA NA NA

VCT.RC.M 2.56 2.62 3.43 3.62 8.05 NA NA

VCT.RC.L 4.31 4.69 11.83 NA NA NA NA

VCT.SC.M 

1.94 

 

1.83 

 

1.96 

 

2.55 

 

2.87 

 

2.99 

 

5.17 

VCT.SC.L 0.28 0.38 0.66 0.94 1.15 1.35 2.30 

VCT.SC.I 2.01 2.64 2.68 2.76 3.37 3.48 8.69 

VCS.SC.M 0.53 0.63 0.69 0.79 0.98 1.39 5.81 

VCS.SC.L 0.29 0.41 0.44 0.54 0.65 1.02 4.19 

VCS.SC.I 2.02 2.07 2.23 2.51 11.81 NA NA

SVO.RC.M 2.26 3.69 3.76 45.08 49.73 NA NA

SVO.SC.M 4.47 4.93 31.14 34.50 NA NA NA

SOC.RC.M 1.24 4.06 4.48 29.08 31.22 35.89 NA

HZO.RC.M 71.06 NA NA NA NA NA NA

HZO.RC.L 2.26 31.64 NA NA NA NA NA

HZO.SC.M 44.20 NA NA NA NA NA NA

HZO.SC.L 30.84 NA NA NA NA NA NA

HCT.SC.M 1.18 1.47 2.15 2.46 2.66 6.10 NA

HCT.SC.L 0.52 0.64 1.06 1.18 1.25 3.00 NA

HCT.SC.I 1.17 2.26 2.83 11.63 NA NA NA

HCS.SC.M 4.26 5.56 6.05 7.56 16.18 NA NA

HCS.SC.L 1.16 1.17 1.48 1.86 5.49 NA NA

PD.SC.M 1.43 1.67 1.71 1.89 2.17 2.95 5.31 

* NA means that no payback period was calculated for this efficiency level because no design options were available to constitute 

an efficiency level.
ES-18

Table ES.3.13 Rebuttable Presumption Payback Periods by Efficiency Level and

Equipment Class

Product 

Class

Median Rebuttable Presumption Payback Period* 

years

Level 2 Level 3 Level 4 Level 5 Level 6 Level 7 Level 8

VOP.RC.M 1.57 1.85 3.37 12.42 15.40 NA NA 

VOP.RC.L 2.60 5.79 11.79 NA NA NA NA 

VOP.SC.M 4.14 4.43 12.46 15.11 NA NA NA 

VCT.RC.M 2.33 2.40 3.24 3.42 7.61 NA NA 

VCT.RC.L 2.99 3.28 8.69 NA NA NA NA 

VCT.SC.M

 

1.83 

 

1.85 

 

1.97 

 

2.53 

 

2.84 

 

2.95 

 

5.10 

VCT.SC.L 0.26 0.35 0.62 0.90 1.10 1.30 2.20 

VCT.SC.I 1.61 2.30 2.35 2.41 2.99 3.07 7.77 

VCS.SC.M 0.48 0.56 0.61 0.71 0.88 1.25 5.21 

VCS.SC.L 0.26 0.37 0.40 0.49 0.59 0.93 3.82 

VCS.SC.I 1.86 1.91 2.04 2.26 10.81 NA NA 

SVO.RC.M 2.11 3.36 3.42 12.84 15.44 NA NA 

SVO.SC.M 4.01 4.43 12.64 14.80 NA NA NA 

SOC.RC.M 0.84 3.59 3.99 11.93 12.73 15.39 NA 

HZO.RC.M 66.19 NA NA NA NA NA NA 

HZO.RC.L 2.07 29.42 NA NA NA NA NA 

HZO.SC.M 41.72 NA NA NA NA NA NA 

HZO.SC.L 29.11 NA NA NA NA NA NA 

HCT.SC.M 1.04 1.28 1.94 2.22 2.38 5.47 NA 

HCT.SC.L 0.47 0.58 0.97 1.08 1.14 2.74 NA 

HCT.SC.I 1.08 1.97 2.55 10.69 NA NA NA 

HCS.SC.M 3.42 4.93 5.21 6.12 14.07 NA NA 

HCS.SC.L 1.04 1.05 1.31 1.68 5.04 NA NA 

PD.SC.M 1.19 1.46 1.50 1.65 1.90 2.59 4.68 

* NA means no RPBP value was calculated for this efficiency level because no design options were available to constitute an 

efficiency level.

ES.3.7 Shipments Analysis

 DOE carries out the shipments analysis to estimate the equipment stock and annual 

shipments of commercial refrigeration equipment in the years following the compliance date of 

the standard. These data are then used as inputs into the NIA, to calculate the NES and NPV of 

future savings, and the MIA, to calculate the industry NPV. 

Shipments of commercial refrigeration equipment are split into two categories: (1) 

equipment for new construction and (2) equipment for replacements. In the first scenario, 

equipment for new construction is the equipment that is being purchased for newly constructed 

commercial space during a year. DOE calculated new shipments based on the DOE Energy 

Information Administration (EIA) Annual Energy Outlook (AEO) forecast of new construction of 

food retail and foodservice space. Equipment for replacements is the equipment that is purchased 

to replace existing equipment that either has failed or is replaced for other reasons. DOE 

calculates the probability of an equipment of age a (in years) failing in a year by using a 

Weibull-distribution based survival function, with mean values of 10 years for foodservice 

installations and large food retail stores and 15 years for small food-retail stores. 
ES-19

 DOE uses historical shipments data to estimate the share of each equipment class in the 

total shipments in a year. Shipments based on number of units shipped are converted into 

shipments in linear feet by assigning a representative unit length to each equipment class. Table 

ES.3.14 shows the assumed linear dimension assigned to each equipment class. Table ES.3.15

shows the percentage of linear feet shipped by equipment class based on 2009 shipment data, 

which was calculated using data from various sources and described in more detail in chapter 9 

of the preliminary analysis TSD. Future market share of each equipment class is assumed to 

remain the same as shown in Table ES.3.15. Forecasted new and replacement shipments, in 

linear feet, are presented in Table ES.3.16 from 2016 to 2045. Table ES.3.17 presents the 

forecasted shipments for each equipment class in linear feet from 2016 to 2045. 

Table ES.3.14 Equipment Linear Dimensions Assumed for Shipments Analysis 

Equipment 

Class

Assumed Length 

feet

Equipment 

Class

Assumed Length 

feet

VOP.RC.M 10 SOC.RC.M 8

VOP.RC.L 10 HZO.RC.M 10

VOP.SC.M 4 HZO.RC.L 10

VCT.RC.M 10 HZO.SC.M 4

VCT.RC.L 10 HZO.SC.L 4

VCT.SC.M 4 HZO.SC.I 4

VCT.SC.L 3.5 HCT.SC.M 3

VCT.SC.I 5 HCT.SC.I 3.4

VCS.SC.M 4 HCS.SC.M 4

VCS.SC.L 3.5 HCS.SC.L 5

VCS.SC.I 5 HCS.SC.I 5

SVO.RC.M 10 PD.SC.M 2.5

SVO.SC.M 4 -- --

Table ES.3.15 Percentage of Shipped Linear Feet of Commercial Refrigeration Equipment 

in the Year 2009 

Equipment 

Class

Percentage of 

Linear Feet 

Shipped

%

Equipment 

Class

Percentage of 

Linear Feet 

Shipped

%

VOP.RC.M 10.81 SOC.RC.M 2.45

VOP.RC.L 1.91 HZO.RC.M 1.49

VOP.SC.M 0.86 HZO.RC.L 4.69

VCT.RC.M 0.91 HZO.SC.M 0.11

VCT.RC.L 12.64 HZO.SC.L 0.23

VCT.SC.M 5.77 HZO.SC.I 0.64

VCT.SC.L 2.93 HCT.SC.M 0.07

VCT.SC.I 2.27 HCT.SC.I 1.01

VCS.SC.M 17.30 HCS.SC.M 5.22

VCS.SC.L 8.80 HCS.SC.L 0.67

VCS.SC.I 0.08 HCS.SC.I 0.80

SVO.RC.M 9.70 PD.SC.M 7.16

SVO.SC.M 1.28 -- --
ES-20

Table ES.3.16 Forecasted Shipments of New and Replacement Commercial Refrigeration 

Equipment by Building Type, 2016–2045 

Division Thousands of Linear Feet Shipped by Year and Equipment Class

2016 2020 2025 2030 2035 2040 2045 Total

Large Grocery

– New 291 338 360 384 406 435 467 11,564 

– Replacement * 1,042 1,169 1,224 1,395 1,502 1,685 1,833 42,279 

Small Grocery

– New 86 100 106 113 120 128 138 3,414 

– Replacement* 301 294 323 338 352 385 411 10,276 

Food Service

– New 303 351 373 399 423 452 485 12,026 

– Replacement * 699 848 920 1,114 1,240 1,444 1,613 33,869 

Total 2,722 3,099 3,307 3,742 4,043 4,530 4,947 113,429 

* Replacement includes equipment replaced from original stock (installed before standards) and 

the standards level equipment replaced in subsequent years.

Table ES.3.17 Forecasted Shipment for Commercial Refrigeration Equipment by 

Equipment Class, 2016–2045 

Equipment

Thousands of Linear Feet Shipped by Year and Equipment Class

2016 2020 2025 2030 2035 2040 2045 Cumulative

VOP.RC.M 294 335 358 405 437 490 535 12,265

VOP.RC.L 52 59 63 71 77 86 94 2,164

VOP.SC.M 23 27 28 32 35 39 42 970

VCT.RC.M 25 28 30 34 37 41 45 1,031

VCT.RC.L 344 392 418 473 511 572 625 14,333

VCT.SC.M 157 179 191 216 233 261 285 6,539

VCT.SC.L 80 91 97 110 119 133 145 3,329

VCT.SC.I 62 70 75 85 92 103 112 2,573

VCS.SC.M 471 536 572 647 699 783 856 19,618

VCS.SC.L 240 273 291 329 356 399 436 9,986

VCS.SC.I 2 2 3 3 3 3 4 88

SVO.RC.M 264 301 321 363 392 440 480 11,007

SVO.SC.M 35 40 42 48 52 58 63 1,453

SOC.RC.M 67 76 81 92 99 111 121 2,775

HZO.RC.M 41 46 49 56 60 68 74 1,691

HZO.RC.L 128 145 155 175 190 212 232 5,318

HZO.SC.M 3 3 4 4 4 5 5 125

HZO.SC.L 6 7 8 9 9 10 11 259

HCT.SC.M 2 2 2 3 3 3 4 81

HCT.SC.L§ - - - - - - - -

HCT.SC.I 28 31 33 38 41 46 50 1,147

HCS.SC.M 142 162 173 195 211 237 258 5,924

HCS.SC.L 18 21 22 25 27 31 33 765

PD.SC.M 195 222 237 268 290 324 354 8,123

Total 2,682 3,053 3,259 3,687 3,984 4,464 4,874 111,768

§ The HCT.SC.L equipment class had no projected shipments. 

ES.3.8 National Impact Analysis 

DOE estimates the national impacts of the future energy conservation standards by 

calculating NES and NPV of future energy savings. Both NES and NPV are estimated by 
ES-21

calculating the difference in energy consumption between the standards-case scenario and the 

base-case scenario that would exist if the current proposed standards were not promulgated. For 

the preliminary analysis, DOE analyzed up to eight efficiency levels from among the engineering 

design option levels. As part of the calculation of NPV, DOE also calculated the total national 

installed cost increases and total national operating cost savings at each efficiency level.

 A key component of DOE’s estimates of NES and NPV is the trend in energy efficiency 

forecasted for the base case and each of the standards cases represented by the efficiency levels. 

To forecast the base-case efficiency for each equipment class, DOE assumed that the least

efficient level analyzed in the engineering analysis currently prevails in the marketplace. To 

determine the standards-case efficiency distributions, DOE assumed that product efficiencies in 

the base case that are below the standard level under consideration would “roll up” to meet the 

new standard level in 2016. The market share of the product efficiencies higher than the standard 

level under consideration would remain the same as the base case. Chapter 10 of the preliminary 

analysis TSD has detailed description and results for NIA. 

 The inputs for NES and NPV calculations are summarized in Table ES.3.18. The 

cumulative national energy savings are presented in Table ES.3.19 for each efficiency level in 

each equipment class for the equipment shipped from 2016 to 2045. Table ES.3.20 and Table 

ES.3.21 present the cumulative NPV results with discount rates of 7 percent and 3 percent, 

respectively.

Table ES.3.18 NES and NPV Inputs

Input Description

Forecasted Shipments Forecasted annual shipments from shipments analysis.

Potential Compliance Date of 

Standard

2016

Base-Case Efficiencies Distribution of base-case shipments by efficiency level.

Annual Energy Consumption per 

Linear Foot

Unit energy consumption for each efficiency level in each equipment class 

is obtained from engineering analysis. This is converted into annual 

weighted-average values for each efficiency level converted to a per linear 

foot basis.

Total Installed Cost per Linear Foot Annual weighted-average values are a function of efficiency level, 

expressed per linear foot basis.

Repair Cost per Linear Foot Annual weighted-average values are constant with efficiency level, 

expressed per linear foot basis.

Maintenance Cost per Linear Foot Annual weighted-average maintenance cost, expressed per linear foot basis.

Escalation of Electricity Prices 2010 EIA AEO forecasts (to 2035) and extrapolation for 2036 and beyond.

Electricity Site-to-Source Conversion Conversion varies yearly and is generated by DOE’s version of the EIA 

National Energy Modeling System (NEMS) program (a time series 

conversion factor; includes electric generation, transmission, and 

distribution losses).

Discount Rate 3 and 7 percent real, per U.S. Office of Management and Budget guidance.

Present Year 2010. Future costs are discounted to the present year.
ES-22

Table ES.3.19 Cumulative National Energy Savings (quads) for All Efficiency Levels in All 

Equipment Classes Analyzed for Preliminary Analysis (2016−2045) 

Equipment 

Class

National Energy Savings by Standard Level*,**

quads

Level 2 Level 3 Level 4 Level 5 Level 6 Level 7 Level 8

VOP.RC.M 0.008 0.012 0.067 0.271 0.285 NA NA 

VOP.RC.L 0.005 0.023 0.031 NA NA NA NA 

VOP.SC.M 0.003 0.003 0.019 0.020 NA NA NA 

VCT.RC.M 0.001 0.001 0.013 0.013 0.014 NA NA 

VCT.RC.L 0.101 0.108 0.153 NA NA NA NA 

VCT.SC.M 0.004 0.067 0.072 0.092 0.100 0.101 0.113

VCT.SC.L 0.004 0.022 0.096 0.152 0.178 0.192 0.205

VCT.SC.I 0.004 0.014 0.016 0.017 0.025 0.027 0.040

VCS.SC.M 0.014 0.049 0.061 0.074 0.103 0.145 0.218

VCS.SC.L 0.011 0.038 0.054 0.071 0.092 0.135 0.207

VCS.SC.I 0.000 0.000 0.000 0.000 0.001 NA NA 

SVO.RC.M 0.005 0.030 0.034 0.161 0.170 NA NA 

SVO.SC.M 0.004 0.004 0.021 0.022 NA NA NA 

SOC.RC.M 0.000 0.002 0.002 0.029 0.029 0.031 NA 

HZO.RC.M 0.000 NA NA NA NA NA NA 

HZO.RC.L 0.001 0.015 NA NA NA NA NA 

HZO.SC.M 0.000 NA NA NA NA NA NA 

HZO.SC.L 0.001 NA NA NA NA NA NA 

HCT.SC.M 0.000 0.000 0.000 0.000 0.000 0.001 NA 

HCT.SC.L§ 0.000 0.000 0.000 0.000 0.000 0.000 NA 

HCT.SC.I 0.000 0.001 0.002 0.009 NA NA NA 

HCS.SC.M 0.001 0.003 0.003 0.004 0.013 NA NA 

HCS.SC.L 0.000 0.001 0.001 0.002 0.006 NA NA 

PD.SC.M 0.041 0.096 0.098 0.111 0.127 0.152 0.180

* NA means no energy savings were calculated for this efficiency level because no design options were available to constitute an 

efficiency level. 

** 0.000 indicates savings are less than 0.001 quadrillion Btu.

§ The HCT.SC.L equipment class had no projected shipments.
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Table ES.3.20 Cumulative NPV Results Based on a 7-Percent Discount Rate. 

Equipment 

Class

Standard Level*,**

Billion 2010$

Level 2 Level 3 Level 4 Level 5 Level 6 Level 7 Level 8

VOP.RC.M 0.018 0.026 0.107 (0.891) (1.220) NA NA 

VOP.RC.L 0.009 0.008 (0.066) NA NA NA NA 

VOP.SC.M 0.004 0.004 (0.074) (0.100) NA NA NA 

VCT.RC.M 0.002 0.003 0.024 0.023 (0.006) NA NA 

VCT.RC.L 0.135 0.130 (0.306) NA NA NA NA 

VCT.SC.M 0.009 0.159 0.166 0.176 0.169 0.162 (0.009)

VCT.SC.L 0.011 0.058 0.249 0.386 0.430 0.438 0.335 

VCT.SC.I 0.008 0.025 0.029 0.029 0.036 0.037 (0.078)

VCS.SC.M 0.037 0.125 0.154 0.182 0.243 0.302 (0.147)

VCS.SC.L 0.030 0.101 0.141 0.182 0.231 0.308 0.066 

VCS.SC.I 0.000 0.000 0.000 0.001 (0.003) NA NA 

SVO.RC.M 0.010 0.051 0.056 (0.612) (0.798) NA NA 

SVO.SC.M 0.006 0.005 (0.085) (0.109) NA NA NA 

SOC.RC.M 0.000 0.003 0.003 (0.071) (0.081) (0.114) NA 

HZO.RC.M (0.009) NA NA NA NA NA NA 

HZO.RC.L 0.002 (0.104) NA NA NA NA NA 

HZO.SC.M (0.002) NA NA NA NA NA NA 

HZO.SC.L (0.004) NA NA NA NA NA NA 

HCT.SC.M 0.000 0.000 0.001 0.001 0.001 (0.000) NA 

HCT.SC.L§ - - - - - - NA 

HCT.SC.I 0.001 0.002 0.004 (0.015) NA NA NA 

HCS.SC.M 0.001 0.003 0.002 (0.001) (0.044) NA NA 

HCS.SC.L 0.000 0.002 0.003 0.005 0.004 NA NA 

PD.SC.M 0.088 0.208 0.210 0.224 0.229 0.186 (0.116)

* A value of NA means that no NPV was calculated for this efficiency level because no design options were available to 

constitute an efficiency level. 

** 0.000 indicates savings are less than $ 0.001 billion. Negative savings mean a net cost to the nation. § The HCT.SC.L equipment class had no projected shipments. No NPV values were reported for this equipment class.
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Table ES.3.21 Cumulative NPV Results Based on a 3-Percent Discount Rate (Billion 2010$) 

Equipment 

Class

Standard Level*,** 

Billion 2010$

Level 2 Level 3 Level 4 Level 5 Level 6 Level 7 Level 8

VOP.RC.M 0.044 0.065 0.291 (1.561) (2.183) NA NA 

VOP.RC.L 0.024 0.041 (0.093) NA NA NA NA 

VOP.SC.M 0.012 0.012 (0.133) (0.182) NA NA NA 

VCT.RC.M 0.005 0.007 0.062 0.061 0.006 NA NA 

VCT.RC.L 0.369 0.368 (0.422) NA NA NA NA 

VCT.SC.M 0.022 0.396 0.418 0.461 0.457 0.444 0.127 

VCT.SC.L 0.025 0.139 0.603 0.945 1.062 1.096 0.912 

VCT.SC.I 0.020 0.066 0.075 0.077 0.102 0.104 (0.101)

VCS.SC.M 0.088 0.302 0.374 0.443 0.600 0.766 (0.016)

VCS.SC.L 0.071 0.244 0.340 0.442 0.563 0.765 0.386 

VCS.SC.I 0.001 0.001 0.001 0.001 (0.004) NA NA 

SVO.RC.M 0.026 0.136 0.150 (1.098) (1.447) NA NA 

SVO.SC.M 0.016 0.015 (0.152) (0.197) NA NA NA 

SOC.RC.M 0.000 0.008 0.010 (0.116) (0.134) (0.197) NA 

HZO.RC.M (0.016) NA NA NA NA NA NA 

HZO.RC.L 0.004 (0.182) NA NA NA NA NA 

HZO.SC.M (0.003) NA NA NA NA NA NA 

HZO.SC.L (0.007) NA NA NA NA NA NA 

HCT.SC.M 0.000 0.000 0.002 0.002 0.002 0.001 NA 

HCT.SC.L§ - - - - - - NA 

HCT.SC.I 0.002 0.005 0.012 (0.016) NA NA NA 

HCS.SC.M 0.002 0.008 0.008 0.004 (0.071) NA NA 

HCS.SC.L 0.001 0.004 0.007 0.013 0.016 NA NA 

PD.SC.M 0.218 0.520 0.526 0.569 0.598 0.547 (0.005)

* A value of NA means that no NPV was calculated for this efficiency level because no equipment options were available to 

constitute an efficiency level. 

** 0.000 indicates savings are less than $ 0.001 billion. Negative savings mean a net cost to the nation.

§ The HCT.SC.L equipment class had no projected shipments. No NPV values were reported for this equipment class.

ES.3.9 Preliminary Manufacturer Impact Analysis

The preliminary MIA addresses the impacts on manufacturers of commercial 

refrigeration equipment that result from setting standards. Potential impacts include financial 

effects, both quantitative and qualitative, that might result from new energy conservation 

standards and consequently lead to changes in manufacturing practices for commercial 

refrigeration equipment. DOE identified potential impacts through interviews with manufacturers 

and other interested parties. Chapter 12 of the preliminary TSD includes details on the key issues 

DOE identified during the preliminary MIA.

Key issues relevant to the MIA for commercial refrigeration equipment include the 

following: 

• Certification, compliance, and enforcement 
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• Testing burden 

• Customer impact

• Refrigerant issues

• Conflicts with other certifications

• Impacts on small manufacturers 

 DOE conducted the preliminary MIA by first identifying equipment, methods, and 

practices used in the commercial refrigeration equipment industry. Next, DOE determined how 

energy efficiency improvements affect cost, production, and various other manufacturing 

metrics. Finally, DOE interviewed manufacturers for feedback on these issues. 

 At the beginning of the interview process, DOE interviewed manufacturers and adjusted 

the analysis, as appropriate, based on the feedback. In the interviews, DOE also examined any 

additional effects on competition, manufacturing capacity, direct employment, and the 

cumulative burden of other regulations affecting manufacturers, as well as several issues raised 

by individual manufacturers. Chapter 12 of the preliminary TSD provides additional details on 

this and other aspects of the preliminary MIA. 

ES.4 ISSUES ON WHICH DOE SEEKS PUBLIC COMMENT 

DOE is particularly interested in receiving comments and views of interested parties 

concerning the following issues. 

ES.4.1 Equipment Classes

DOE seeks comment regarding the proposed equipment classes as outlined in this 

executive summary as well as in chapter 3 of the preliminary TSD. 

ES.4.2 Test Procedure Issues

Concurrent with this energy conservation standards rulemaking, DOE is undertaking a 

rulemaking to address amendments to its test procedures for commercial refrigeration equipment. 

In November 2010, DOE published a NOPR announcing proposed amendments to the DOE 

commercial refrigeration equipment test procedure. 75 FR 71596 (Nov. 24, 2010). These

amendments included updating the references to industry test procedures to refer to the most 

current versions, adding a method for determining energy savings due to the use of night curtains 

on open cases, including a calculation for determining energy savings due to use of lighting 

occupancy sensors or controls, and adding a provision for testing at the lowest application 

product temperature. DOE welcomes comments regarding the effects that the proposed test 

procedure changes could have on the energy conservation standards rulemaking currently in 

process. 

ES.4.3 Normalization Metrics

In the engineering analysis, results are developed in the form of MPC values versus 

calculated daily energy consumption. To develop these results into standards that are applicable 

to a wide range of equipment, DOE then normalizes these costs and energy consumption values 
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using a measure of commercial refrigeration equipment unit size, termed “normalization metric.” 

In the 2009 rulemaking, DOE chose total display area as the normalization metric for equipment 

with display areas and refrigerated volume as the normalization metric for storage equipment 

without a feature display area for merchandising. The EPCA standards use refrigerated volume 

as the normalization metric for all covered equipment. For this rulemaking, which covers both 

the 2009 final rule equipment and the EPCA equipment, DOE is considering retaining the

metrics used in EPCA and the 2009 final rule. DOE welcomes comments on the proposed 

approach for normalization metrics. See chapter 2, section 2.4.2 of the preliminary TSD for more 

details. 

ES.4.4 Pull-Down Equipment

In the engineering analytical models, DOE analyzed commercial refrigerators with 

transparent doors for pull-down temperature applications as a separate, primary equipment class. 

DOE did not receive many specific comments regarding these units during the Framework public 

meeting and ensuing comment period. DOE understands that pull-down merchandiser units 

feature oversized compressors to aid in pulling warm product down to temperature quickly, as 

well as additional lighting for product illumination purposes. However, DOE requests comment 

regarding additional design features that may differentiate these units from other self-contained 

refrigerators with vertical transparent doors. Additionally, DOE seeks specific data regarding the 

use of these units so that they may be specifically modeled in the energy use analysis and other 

downstream analyses.

ES.4.5 Manufacturer Impact

As part of the NOPR, DOE will seek further comments from manufacturers about their 

potential loss of market share, changes in the efficiency distribution of covered equipment within 

each industry, and the total change in equipment shipments at each energy conservation standard 

level. DOE will then estimate the impacts on the industry quantitatively and qualitatively. DOE 

seeks further comment about the impact of standards on domestic manufacturers. See chapter 2, 

section 2.10 of the preliminary TSD for more details. 

ES.4.6 Share of Distribution Channels

DOE has retained the distribution channel shares for remote condensing equipment from 

the 2009 final rule. However, the distribution channel shares for self-contained equipment have 

been altered based on new data. DOE requests interested parties’ comments on the new 

distribution channel share values.

ES.4.7 Equipment Lifetimes

Based on the data from available sources, DOE assumed an average lifetime value of 10 

years for all self-contained equipment and large retail stores and 15 years for small retail stores. 

DOE used Weibull survival functions to represent the equipment lifetime values in the LCC and 

PBP analysis and shipments analysis. DOE welcomes input from interested parties on these 

assumptions. 
ES-27

ES.4.8 Installation, Maintenance, and Repair Costs 

DOE assumes flat installation and preventative-maintenance costs over all efficiency 

levels in each equipment class. The lighting maintenance cost and other components’ repair costs 

vary with original equipment manufacturer cost of the replaced components, which results in an 

increasing lighting maintenance and other components’ repair costs with higher efficiency levels. 

The technology options under consideration for the rulemaking are presented in chapter 5 of this

TSD. DOE requests input from interested parties concerning the effect that these technology 

options have on the installation, maintenance, and repair costs. 

ES.4.9 General Analytical Assumptions 

During each stage of the preliminary analysis, DOE made assumptions related to key 

parameters of the analytical process on the premises that the assumed parameters reflect the 

actual conditions that commercial refrigeration equipment experiences. These assumptions are 

described in the respective TSD chapters. DOE welcomes comments on these assumptions.