RI A-i

REGULATORY IMPACT ANALYSIS FOR PROPOSED ENERGY CONSERVATION

STANDARDS FOR BATTERY CHARGERS AND EXTERNAL POWER SUPPLIES

TABLE OF CONTENTS

RIA.1 INTRODUCTION ...................................................................................................... RIA-1

RIA.2 METHODOLOGY ..................................................................................................... RIA-1RI A-1

REGULATORY IMPACT ANALYSIS FOR PROPOSED ENERGY CONSERVATION

STANDARDS FOR BATTERY CHARGERS AND EXTERNAL POWER SUPPLIES

RIA.1 INTRODUCTION

Under the Process Rule ( Procedures for Consideration of New or Revised Energy Conservation Standards for Consumer Products , 61 FR 36974 (July 15, 1996)), the U.S. Department of Energy (DOE) is committed to continually explore non-regulatory alternatives to standards. DOE will prepare a draft regulatory impact analysis pursuant to E.O. 12866, “Regulatory Planning and Review,” which will be subject to review under the Executive Order by the Office of Ma nagement and Budget’s Office of Information and Regulatory Affairs. 58 FR 51735. DOE has identified seven major alternatives to standards as representing feasible policy options to reduce consumer product energy consumption. It will evaluate each alternative in terms of its ability to achieve significant energy savings at a reasonable cost, and will compare the effectiveness of each one to the effectiveness of the proposed standards rule.

DOE proposes to analyze the following non-regulatory means of achieving energy savings: No new regulatory action

Consumer tax credits

Manufacturer tax credits

Performance standards

Rebates Voluntary energy efficiency targets Early replacement Bulk government purchases

The technical support document (TSD) in support of DOE’s notice of proposed rulemaking will include a complete quantitative analysis of each alternative, the methodology for which is discussed briefly below.

RIA.2 METHODOLOGY

DOE will use the national impact analysis (NIA) spreadsheet models for each of the two products to calculate the national energy savings and the net present value (NPV) corresponding to each alternative to the proposed standards. The NIA model for battery chargers (BCs) and external power supplies (EPSs) is discussed in chapter 10 of the TSD. To compare each alternative quantitatively to the proposed energy conservation standards, DOE will need to quantify the effect of each alternative on the purchase and use of energy-efficient BCs and EPSs. Once it has quantified each alternative, DOE will make the appropriate revisions to the inputs in the NIA models. Key inputs that DOE may revise in these models are:

• Energy prices and escalation factors;

• Implicit market discount rates for trading off purchase price against operating expense when choosing equipment efficiency;

• Consumer purchase price, operating cost, and income elasticities;

• Consumer price-versus-efficiency relationships; and

• Product stock data (purchase of new product or turnover rates for inventories).RI A-2

The key measures of the impact of each alternative will be:

• Energy use (in quadrillion Btu): Cumulative energy use of the products sold from the effective date of the new standard, 2013, until products sold in 2042 are retired from use. DOE will report electricity consumption as primary (source) energy.

• National energy savings: Cumulative national energy use from the base case projection minus the alternative policy case projection.

• Net present value: The value of future operating cost savings from products bought in the period from 2013 to 2042. DOE will calculate the NPV as the difference between the present value of product and operating expenditures (including energy) in the base case, and the present value of expenditures in each alternative policy case. DOE will

discount future operating and product expenditures to 2010 using a seven-percent and three-percent real discount rate. It will calculate operating expenses (including energy costs) for the life of the products.