```

[Federal Register Volume 80, Number 18 (Wednesday, January 28, 2015)]
[Rules and Regulations]
[Pages 4645-4756]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2015-00326]

[[Page 4645]]

Vol. 80

Wednesday,

No. 18

January 28, 2015

Part II

Department of Energy

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10 CFR Part 431

 Energy Conservation Program: Energy Conservation Standards for 
Automatic Commercial Ice Makers; Final Rule

Federal Register / Vol. 80 , No. 18 / Wednesday, January 28, 2015 / 
Rules and Regulations

[[Page 4646]]

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DEPARTMENT OF ENERGY

10 CFR Part 431

[Docket Number EERE-2010-BT-STD-0037]
RIN 1904-AC39

Energy Conservation Program: Energy Conservation Standards for 
Automatic Commercial Ice Makers

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

ACTION: Final rule.

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

SUMMARY: The Energy Policy and Conservation Act of 1975 (EPCA), as 
amended, prescribes energy conservation standards for various consumer 
products and certain commercial and industrial equipment, including 
automatic commercial icemakers (ACIM). EPCA also requires the U.S. 
Department of Energy (DOE) to determine whether more-stringent 
standards would be technologically feasible and economically justified, 
and would save a significant amount of energy. In this final rule, DOE 
is adopting more-stringent energy conservation standards for some 
classes of automatic commercial ice makers as well as establishing 
energy conservation standards for other classes of automatic commercial 
ice makers. It has determined that the amended energy conservation 
standards for these products would result in significant conservation 
of energy, and are technologically feasible and economically justified.

DATES: The effective date of this rule is March 30, 2015. Compliance 
with the amended standards established for automatic commercial ice 
makers in this final rule is required on January 28, 2018.

ADDRESSES: The docket, which includes Federal Register notices, public 
meeting attendee lists and transcripts, comments, and other supporting 
documents/materials, is available for review at www.regulations.gov. 
All documents in the docket are listed in the regulations.gov index. 
However, some documents listed in the index, such as those containing 
information that is exempt from public disclosure, may not be publicly 
available.
    A link to the docket Web page can be found at: http://www.regulations.gov/#!docketDetail;D=EERE-2010-BT-STD-0037.
    The regulations.gov Web page will contain simple instructions on 
how to access all documents, including public comments, in the docket.
    For further information on how to review the docket, contact Ms. 
Brenda Edwards at (202) 586-2945 or by email: 
Brenda.Edwards@ee.doe.gov.

FOR FURTHER INFORMATION CONTACT:
    John Cymbalsky, U.S. Department of Energy, Office of Energy 
Efficiency and Renewable Energy, Building Technologies Program, EE-2J, 
1000 Independence Avenue SW., Washington, DC 20585-0121. Telephone: 
(202) 287-1692. Email: commercial_ice_makers@EE.Doe.Gov.
    Ms. Sarah Butler, U.S. Department of Energy, Office of the General 
Counsel, Mailstop GC-71, 1000 Independence Avenue SW., Washington, DC 
20585-0121. Telephone: (202) 586-1777. Email: Sarah.Butler@hq.doe.gov.

SUPPLEMENTARY INFORMATION:

Table of Contents

I. Discussion of the Final Rule and Its Benefits
    A. Benefits and Costs to Customers
    B. Impact on Manufacturers
    C. National Benefits and Costs
    D. Conclusion
II. Introduction
    A. Authority
    B. Background
    1. Current Standards
    2. History of Standards Rulemaking for Automatic Commercial Ice 
Makers
III. General Discussion
    A. Equipment Classes and Scope of Coverage
    B. Test Procedure
    C. Technological Feasibility
    1. General
    2. Maximum Technologically Feasible Levels
    D. Energy Savings
    1. Determination of Savings
    2. Significance of Savings
    E. Economic Justification
    1. Specific Criteria
    a. Economic Impact on Manufacturers and Commercial Customers
    b. Savings in Operating Costs Compared to Increase in Price 
(Life Cycle Costs)
    c. Energy Savings
    d. Lessening of Utility or Performance of Equipment
    e. Impact of Any Lessening of Competition
    f. Need of the Nation To Conserve Energy
    g. Other Factors
    2. Rebuttable Presumption
IV. Methodology and Discussion of Comments
    A. General Rulemaking Issues
    1. Proposed Standard Levels
    2. Compliance Date
    3. Negotiated Rulemaking
    4. Refrigerant Regulation
    5. Data Availability
    6. Supplemental Notice of Proposed Rulemaking.
    7. Rulemaking Structure Comments
    B. Market and Technology Assessment
    1. Equipment Classes
    a. Cabinet Size
    b. Large-Capacity Batch Ice Makers
    c. Regulation of Potable Water Use
    d. Regulation of Condenser Water Use
    e. Continuous Models
    f. Gourmet Ice Machines
    2. Technology Assessment
    a. Alternative Refrigerants
    C. Screening Analysis
    a. General Comments
    b. Drain Water Heat Exchanger
    c. Tube Evaporator Design
    d. Low Thermal Mass Evaporator Design
    e. Microchannel Heat Exchangers
    f. Smart Technologies
    g. Motors
    D. Engineering Analysis
    1. Representative Equipment for Analysis
    2. Efficiency Levels
    a. Baseline Efficiency Levels
    b. Incremental Efficiency Levels
    c. IMH-A-Large-B Treatment
    d. Maximum Available Efficiency Equipment
    e. Maximum Technologically Feasible Efficiency Levels
    3. Design Options
    a. Design Options that Need Cabinet Growth
    b. Improved Condenser Performance
    c. Compressors
    d. Evaporator
    e. Interconnectedness of Automatic Commercial Ice Maker System
    4. Cost Assessment Methodology
    a. Manufacturing Cost
    b. Energy Consumption Model
    c. Revision of NOPR and NODA Engineering Analysis
    E. Markups Analysis
    F. Energy Use Analysis
    G. Life-Cycle Cost and Payback Period Analysis
    1. Equipment Cost
    2. Installation, Maintenance, and Repair Costs
    a. Installation Costs
    b. Repair and Maintenance Costs
    3. Annual Energy and Water Consumption
    4. Energy Prices
    5. Energy Price Projections
    6. Water Prices
    7. Discount Rates
    8. Lifetime
    9. Compliance Date of Standards
    10. Base-Case and Standards-Case Efficiency Distributions
    11. Inputs to Payback Period Analysis
    12. Rebuttable Presumption Payback Period
    H. National Impact Analysis--National Energy Savings and Net 
Present Value
    1. Shipments
    2. Forecasted Efficiency in the Base Case and Standards Cases
    3. National Energy Savings
    4. Net Present Value of Customer Benefit
    I. Customer Subgroup Analysis
    J. Manufacturer Impact Analysis
    1. Overview
    2. Government Regulatory Impact Model
    a. Government Regulatory Impact Model Key Inputs
    b. Government Regulatory Impact Model Scenarios
    3. Discussion of Comments
    a. Conversion Costs
    b. Cumulative Regulatory Burden

[[Page 4647]]

    c. SNAP and Compliance Date Considerations
    d. ENERGY STAR
    e. Request for DOE and EPA Collaboration
    f. Compliance With Refrigerant Changes Could Be Difficult
    g. Small Manufacturers
    h. Large Manufacturers
    i. Negative Impact on Market Growth
    j. Negative Impact on Non-U.S. Sales
    k. Employment
    l. Compliance With 12866 and 13563
    m. Warranty Claims
    n. Impact to Suppliers, Distributors, Dealers, and Contractors
    K. Emissions Analysis
    L. Monetizing Carbon Dioxide and Other Emissions Impacts
    1. Social Cost of Carbon
    a. Monetizing Carbon Dioxide Emissions
    b. Development of Social Cost of Carbon Values
    c. Current Approach and Key Assumptions
    2. Valuation of Other Emissions Reductions
    M. Utility Impact Analysis
    N. Employment Impact Analysis
    O. Regulatory Impact Analysis
V. Analytical Results
    A. Trial Standard Levels
    1. Trial Standard Level Formulation Process and Criteria
    2. Trial Standard Level Equations
    B. Economic Justification and Energy Savings
    1. Economic Impacts on Commercial Customers
    a. Life-Cycle Cost and Payback Period
    b. Life-Cycle Cost Subgroup Analysis
    2. Economic Impacts on Manufacturers
    a. Industry Cash Flow Analysis Results
    b. Impacts on Direct Employment
    c. Impacts on Manufacturing Capacity
    d. Impacts on Subgroups of Manufacturers
    e. Cumulative Regulatory Burden
    3. National Impact Analysis
    a. Amount and Significance of Energy Savings
    b. Net Present Value of Customer Costs and Benefits
    c. Water Savings
    d. Indirect Employment Impacts
    4. Impact on Utility or Performance of Equipment
    5. Impact of Any Lessening of Competition
    6. Need of the Nation To Conserve Energy
    7. Other Factors
    C. Conclusions/Proposed Standard
VI. Procedural Issues and Regulatory Review
    A. Review Under Executive Orders 12866 and 13563
    B. Review Under the Regulatory Flexibility Act
    1. Description and Estimated Number of Small Entities Regulated
    2. Description and Estimate of Compliance Requirements
    3. Duplication, Overlap, and Conflict With Other Rules and 
Regulations
    4. Significant Alternatives to the Rule
    C. Review Under the Paperwork Reduction Act
    D. Review Under the National Environmental Policy Act of 1969
    E. Review Under Executive Order 13132
    F. Review Under Executive Order 12988
    G. Review Under the Unfunded Mandates Reform Act of 1995
    H. Review Under the Treasury and General Government 
Appropriations Act, 1999
    I. Review Under Executive Order 12630
    J. Review Under the Treasury and General Government 
Appropriations Act, 2001
    K. Review Under Executive Order 13211
    L. Review Under the Information Quality Bulletin for Peer Review
    M. Congressional Notification
VII. Approval of the Office of the Secretary

I. Discussion of the Final Rule and Its Benefits

    Title III, Part C \1\ of the Energy Policy and Conservation Act of 
1975 (EPCA or the Act), Public Law 94-163 (42 U.S.C. 6311-6317, as 
codified), established the Energy Conservation Program for Certain 
Industrial Equipment, a program covering certain industrial 
equipment,\2\ which includes the focus of this final rule: Automatic 
commercial ice makers (ACIM).
---------------------------------------------------------------------------

    \1\ For editorial reasons, upon codification in the U.S. Code, 
Part C was re-designated Part A-1.
    \2\ All references to EPCA in this document refer to the statute 
as amended through the American Energy Manufacturing Technical 
Corrections Act (AEMTCA), Public Law 112-210 (Dec. 18, 2012).
---------------------------------------------------------------------------

    Pursuant to EPCA, any new or amended energy conservation standard 
that DOE prescribes for certain products, such as automatic commercial 
ice makers, shall be designed to achieve the maximum improvement in 
energy efficiency that DOE determines is both technologically feasible 
and economically justified. (42 U.S.C. 6295(o)(2)(A)) Furthermore, the 
new or amended standard must result in significant conservation of 
energy. (42 U.S.C. 6295(o)(3)(B) and 6313(d)(4))
    In accordance with these and other statutory criteria discussed in 
this final rule, DOE is amending energy conservation standards for 
automatic commercial ice makers,\3\ and new standards for covered 
equipment not yet subject to energy conservation standards. The amended 
standards, which consist of maximum allowable energy use per 100 lb of 
ice production, are shown in Table I.1 and Table I.2. Standards shown 
on Table I.1 for batch type ice makers represent the amendments to 
existing standards set for cube type ice makers at 42 U.S.C. 
6313(d)(1), and new standards for cube type ice makers with expanded 
harvest capacities up to 4,000 pounds of ice per 24 hour period (lb 
ice/24 hours) and an explicit coverage of other types of batch 
machines, such as tube type ice makers. Table I.2 provides new 
standards for continuous type ice-making machines, which were not 
previously currently covered by DOE's existing standards. The amended 
standards include, for applicable equipment classes, maximum condenser 
water usage values in gallons per 100 lb of ice production. These new 
and amended standards apply to all equipment manufactured in, or 
imported into, the United States, on or after January 28, 2018. (42 
U.S.C. 6313(d)(2)(B)(i) and (3)(C)(i))
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    \3\ EPCA as amended by EPACT 2005 established maximum energy use 
and maximum condenser water use standards for cube type automatic 
commercial ice makers with harvest capacities between 50 and 2,500 
lb ice/24 hours. In this rulemaking, DOE is amending the legislated 
energy use standards for these automatic commercial ice maker types. 
DOE is not, however, amending the existing condenser water use 
standards for equipment with existing condenser water standards.

                                 Table I.1--Energy Conservation Standards for Batch Type Automatic Commercial Icemakers
                                                     [Compliance required starting January 28, 2018]
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                                                                                             Maximum energy use kilowatt-   Maximum condenser water use
         Equipment type                Type of cooling       Harvest rate lb ice/24 hours      hours (kWh)/100 lb ice *          gal/100 lb ice **
--------------------------------------------------------------------------------------------------------------------------------------------------------
Ice-Making Head.................  Water...................  =300 and =850 and =1,500 and =2,500 and =300 and =800 and =1500 and =50 and =1,000 and =942 and =200 and =2,500 and =110 and =200 and 100 lb   Maximum condenser water use
         Equipment type                Type of cooling       Harvest rate lb ice/24 hours               ice *                    gal/100 lb ice **
--------------------------------------------------------------------------------------------------------------------------------------------------------
Ice-Making Head.................  Water...................  =801 and =2,500 and =310 and =820 and =800 and =800 and =900 and =2,500 and =200 and =700 and 2), 16.2 thousand 
tons of nitrogen oxides (NOX), 0.1 thousand tons of nitrous 
oxide (N2O), 47.4 thousand tons of methane (CH4), 
0.03 tons of mercury (Hg),\10\ and 9.3 thousand tons of sulfur dioxide 
(SO2) based on energy savings from equipment purchased over 
the period from 2018-2047.\11\ The cumulative reduction in 
CO2 emissions through 2030 amounts to 4 MMt, which is 
equivalent to the emissions resulting from the annual electricity use 
of over half a million homes.
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    \9\ A metric ton is equivalent to 1.1 U.S. short tons. Results 
for NOX, Hg, and SO2 are presented in short 
tons.
    \10\ DOE calculates emissions reductions relative to the Annual 
Energy Outlook 2014 (AEO2014) Reference Case, which generally 
represents current legislation and environmental regulations for 
which implementing regulations were available as of October 31, 
2013.
    \11\ DOE also estimated CO2 and CO2 
equivalent (CO2eq) emissions that occur through 2030 
(CO2eq includes greenhouse gases such as CH4 
and N2O). The estimated emissions reductions through 2030 
are 3.9 million metric tons CO2, 395 thousand tons 
CO2eq for CH4, and 12 thousand tons 
CO2eq for N2O.
---------------------------------------------------------------------------

    The value of the CO2 reductions is calculated using a 
range of values per metric ton of CO2 (otherwise known as 
the social cost of carbon, or SCC) developed by a recent Federal 
interagency process.\12\ The derivation of the SCC value is discussed 
in section IV.L. Using discount rates appropriate for each set of SCC 
values, DOE estimates the net present monetary value of the 
CO2 emissions reduction is between $0.08 and $1.11 billion, 
expressed in 2013$ and discounted to 2014, with a value of $0.36 
billion using the central SCC case represented by $40.5/t in 2015. DOE 
also estimates the net present monetary value of the NOX 
emissions reduction, expressed in 2013$ and discounted to 2014, is 
between $2.1 and $22.0 million at a 7-percent discount rate, and 
between $4.2 and $43.4 million at a 3-percent discount rate.\13\
---------------------------------------------------------------------------

    \12\ http://www.whitehouse.gov/sites/default/files/omb/assets/inforeg/technical-update-social-cost-of-carbon-for-regulator-impact-analysis.pdf.
    \13\ DOE has decided to await further guidance regarding 
consistent valuation and reporting of Hg emissions before it 
monetizes Hg in its rulemakings.
---------------------------------------------------------------------------

    Table I.4 summarizes the national economic costs and benefits 
expected to result from these new and amended standards for automatic 
commercial ice makers.

[[Page 4650]]

  Table I.4--Summary of National Economic Benefits and Costs of Amended Automatic Commercial Ice Makers Energy
                                            Conservation Standards *
----------------------------------------------------------------------------------------------------------------
                                                                                Present value     Discount rate
                                  Category                                      million 2013$          (%)
----------------------------------------------------------------------------------------------------------------
                                                    Benefits
----------------------------------------------------------------------------------------------------------------
Operating Cost Savings......................................................               654                 7
                                                                                         1,353                 3
CO2 at 5% dr, average.......................................................                80                 5
CO2 at 3% dr, average.......................................................               361                 3
CO2 at 2.5% dr, average.....................................................               570               2.5
CO2 at 3% dr, 95th perc.....................................................             1,113                 3
NOX Reduction Monetized Value (at $2,684/Ton) **............................                12                 7
                                                                                            24                 3
Total Benefits [dagger].....................................................             1,027                 7
                                                                                         1,738                 3
----------------------------------------------------------------------------------------------------------------
                                                      Costs
----------------------------------------------------------------------------------------------------------------
Incremental Installed Costs.................................................               224                 7
                                                                                           411                 3
----------------------------------------------------------------------------------------------------------------
                                                  Net Benefits
----------------------------------------------------------------------------------------------------------------
Including CO2 and NOX Reduction Monetized Value.............................               803                 7
                                                                                         1,326                 3
----------------------------------------------------------------------------------------------------------------
* The CO2 values represent global monetized values of the SCC in 2013$ in year 2015 under several scenarios. The
  values of $12, $40.5, and $62.4 per metric ton (t) are the averages of SCC distributions calculated using 5-
  percent, 3-percent, and 2.5-percent discount rates, respectively. The value of $119.0/t represents the 95th
  percentile of the SCC distribution calculated using a 3-percent discount rate. The SCC time series used by DOE
  incorporate an escalation factor.
** The value represents the average of the low and high NOX values used in DOE's analysis.
[dagger] Total Benefits for both the 3-percent and the 7-percent cases are derived using the series
  corresponding to SCC value of $40.5/t.

    The benefits and costs of these new and amended standards, for 
automatic commercial ice makers sold in 2018-2047, can also be 
expressed in terms of annualized values. The annualized monetary values 
are the sum of (1) the annualized national economic value of the 
benefits from the operation of equipment that meets the amended 
standards (consisting primarily of operating cost savings from using 
less energy and water, minus increases in equipment installed cost, 
which is another way of representing customer NPV); and (2) the 
annualized monetary value of the benefits of emission reductions, 
including CO2 emission reductions.\14\
---------------------------------------------------------------------------

    \14\ DOE used a two-step calculation process to convert the 
time-series of costs and benefits into annualized values. First, DOE 
calculated a present value in 2014, the year used for discounting 
the NPV of total consumer costs and savings, for the time-series of 
costs and benefits using discount rates of 3 and 7 percent for all 
costs and benefits except for the value of CO2 
reductions. For the latter, DOE used a range of discount rates, as 
shown in Table I.4. From the present value, DOE then calculated the 
fixed annual payment over a 30-year period (2018 through 2047) that 
yields the same present value. The fixed annual payment is the 
annualized value. Although DOE calculated annualized values, this 
does not imply that the time-series of cost and benefits from which 
the annualized values were determined is a steady stream of 
payments.
---------------------------------------------------------------------------

    Although adding the values of operating savings to the values of 
emission reductions provides an important perspective, two issues 
should be considered. First, the national operating savings are 
domestic U.S. customer monetary savings that occur as a result of 
market transactions, whereas the value of CO2 reductions is 
based on a global value. Second, the assessments of operating cost 
savings and CO2 savings are performed with different methods 
that use different time frames for analysis. The national operating 
cost savings is measured over the lifetimes of automatic commercial ice 
makers shipped from 2018 to 2047. The SCC values, on the other hand, 
reflect the present value of some future climate-related impacts 
resulting from the emission of 1 ton of CO2 in each year. 
These impacts continue well beyond 2100.
    Estimates of annualized benefits and costs of the amended standards 
are shown in Table I.5. (All monetary values below are expressed in 
2013$.) Table I.5 shows the primary, low net benefits, and high net 
benefits scenarios. The primary estimate is the estimate in which the 
operating cost savings were calculated using the Annual Energy Outlook 
2014 (AEO2014) Reference Case forecast of future electricity prices. 
The low net benefits estimate and the high net benefits estimate are 
based on the low and high electricity price scenarios from the AEO2014 
forecast, respectively.\15\ Using a 7-percent discount rate for 
benefits and costs, the cost in the primary estimate of the standards 
amended in this rule is $22 million per year in increased equipment 
costs. (Note that DOE used a 3-percent discount rate along with the 
corresponding SCC series value of $40.5/ton in 2013$ to calculate the 
monetized value of CO2 emissions reductions.) The annualized 
benefits are $65 million per year in reduced equipment operating costs, 
$20 million in CO2 reductions, and $1.19 million in reduced 
NOX emissions. In this case, the annualized net benefit 
amounts to $64 million. At a 3-percent discount rate for all benefits 
and costs, the cost in the primary estimate of the amended standards 
presented in this rule is $23 million per year in increased equipment 
costs. The benefits are $75 million per year in reduced operating 
costs, $20 million in CO2 reductions, and $1.33 million in 
reduced NOX emissions. In this case, the net benefit amounts 
to $74 million per year.
---------------------------------------------------------------------------

    \15\ The AEO2014 scenarios used are the ``High Economics'' and 
``Low Economics'' scenarios.
---------------------------------------------------------------------------

    DOE also calculated the low net benefits and high net benefits 
estimates

[[Page 4651]]

by calculating the operating cost savings and shipments at the AEO2014 
low economic growth case and high economic growth case scenarios, 
respectively. The low and high benefits for incremental installed costs 
were derived using the low and high price learning scenarios. The net 
benefits and costs for low and high net benefits estimates were 
calculated in the same manner as the primary estimate by using the 
corresponding values of operating cost savings and incremental 
installed costs.

      Table I.5--Annualized Benefits and Costs of Proposed Standards for Automatic Commercial Ice Makers *
----------------------------------------------------------------------------------------------------------------
                                                                                   Low net          High net
                                            Discount rate        Primary          benefits          benefits
                                                 (%)            estimate*        estimate *        estimate *
                                                              million 2013$     million 2013$     million 2013$
----------------------------------------------------------------------------------------------------------------
                                                    Benefits
----------------------------------------------------------------------------------------------------------------
Operating Cost Savings..................                 7                65                62                68
                                                         3                75                71                80
CO2 at 5% dr, average **................                 5                 6                 6                 6
CO2 at 3% dr, average **................                 3                20                20                21
CO2 at 2.5% dr, average **..............               2.5                29                28                30
CO2 at 3% dr, 95th perc **..............                 3                62                60                64
NOX Reduction Monetized Value (at $2,684/                7              1.19              1.16              1.22
 Ton) **................................                 3              1.33              1.29              1.36
Total Benefits (Operating Cost Savings,                  7                86                82                90
 CO2 Reduction and NOX Reduction)                        3                97                92               102
 [dagger]...............................
----------------------------------------------------------------------------------------------------------------
                                                      Costs
----------------------------------------------------------------------------------------------------------------
Total Incremental Installed Costs.......                 7                22                23                21
                                                         3                23                24                22
----------------------------------------------------------------------------------------------------------------
                                             Net Benefits Less Costs
----------------------------------------------------------------------------------------------------------------
Total Benefits Less Incremental Costs...                 7                64                60                69
                                                         3                74                68                80
----------------------------------------------------------------------------------------------------------------
* The primary, low, and high estimates utilize forecasts of energy prices from the AEO2014 Reference Case, Low
  Economic Growth Case, and High Economic Growth Case, respectively.
** These values represent global values (in 2013$) of the social cost of CO2 emissions in 2015 under several
  scenarios. The values of $12, $40.5, and $62.4 per ton are the averages of SCC distributions calculated using
  5-percent, 3-percent, and 2.5-percent discount rates, respectively. The value of $119.0 per ton represents the
  95th percentile of the SCC distribution calculated using a 3-percent discount rate. See section IV.L for
  details. For NOX, an average value ($2,684) of the low ($476) and high ($4,893) values was used.
[dagger] Total monetary benefits for both the 3-percent and 7-percent cases utilize the central estimate of
  social cost of NOX and CO2 emissions calculated at a 3-percent discount rate (averaged across three integrated
  assessment models), which is equal to $40.5/ton (in 2013$).

D. Conclusion

    Based on the analyses culminating in this final rule, DOE found the 
benefits to the nation of the amended standards (energy savings, 
consumer LCC savings, positive NPV of consumer benefit, and emission 
reductions) outweigh the burdens (loss of INPV and LCC increases for 
some users of this equipment). DOE has concluded that the standards in 
this final rule represent the maximum improvement in energy efficiency 
that is both technologically feasible and economically justified, and 
would result in significant conservation of energy. (42 U.S.C. 6295(o), 
6313(d)(4))

II. Introduction

    The following section briefly discusses the statutory authority 
underlying this final rule, as well as some of the relevant historical 
background related to the establishment of amended standards for 
automatic commercial ice makers.

A. Authority

    Title III, Part C \16\ of EPCA, Public Law 94-163 (42 U.S.C. 6311-
6317, as codified), added by Public Law 95-619, Title IV, section 
441(a), established the Energy Conservation Program for Certain 
Industrial Equipment, a program covering certain industrial equipment, 
which includes automatic commercial ice makers, the focus of this 
rule.\17\
---------------------------------------------------------------------------

    \16\ For editorial reasons, upon codification in the U.S. Code, 
Part C was re-designated Part A-1.
    \17\ All references to EPCA in this document refer to the 
statute as amended through the American Energy Manufacturing 
Technical Corrections Act (AEMTCA), Public Law 112-210 (Dec. 18, 
2012).
---------------------------------------------------------------------------

    EPCA prescribed energy conservation standards for automatic 
commercial ice makers that produce cube type ice with capacities 
between 50 and 2,500 lb ice/24 hours. (42 U.S.C. 6313(d)(1)) EPCA 
requires DOE to review these standards and determine, by January 1, 
2015, whether amending the applicable standards is technically feasible 
and economically justified. (42 U.S.C. 6313(d)(3)(A)) If amended 
standards are technically feasible and economically justified, DOE must 
issue a final rule by the same date. (42 U.S.C. 6313(d)(3)(B)) 
Additionally, EPCA granted DOE the authority to conduct rulemakings to 
establish new standards for automatic commercial ice makers not covered 
by 42 U.S.C. 6313(d)(1)), and DOE is using that authority in this 
rulemaking. (42 U.S.C. 6313(d)(2)(A))
    Pursuant to EPCA, DOE's energy conservation program for covered 
equipment generally consists of four parts: (1) Testing; (2) labeling; 
(3) the establishment of Federal energy conservation standards; and (4) 
certification and enforcement procedures. For automatic commercial ice 
makers, DOE is responsible for the entirety of this program. Subject to 
certain criteria and conditions, DOE is required to develop test 
procedures to measure the energy efficiency, energy use, or estimated 
annual operating cost of each type or class of covered equipment. (42 
U.S.C. 6314) Manufacturers of covered equipment

[[Page 4652]]

must use the prescribed DOE test procedure as the basis for certifying 
to DOE that their equipment complies with the applicable energy 
conservation standards adopted under EPCA and when making 
representations to the public regarding the energy use or efficiency of 
that equipment. (42 U.S.C. 6315(b), 6295(s)) Similarly, DOE must use 
these test procedures to determine whether that equipment complies with 
standards adopted pursuant to EPCA. The DOE test procedure for 
automatic commercial ice makers currently appears at title 10 of the 
Code of Federal Regulations (CFR) part 431, subpart H.
    DOE must follow specific statutory criteria for prescribing amended 
standards for covered equipment. As indicated above, any amended 
standard for covered equipment must be designed to achieve the maximum 
improvement in energy efficiency that is technologically feasible and 
economically justified. (42 U.S.C. 6295(o)(2)(A) and 6313(d)(4)) 
Furthermore, DOE may not adopt any standard that would not result in 
the significant conservation of energy. (42 U.S.C. 6295(o)(3) and 
6313(d)(4)) DOE also may not prescribe a standard: (1) For certain 
equipment, including automatic commercial ice makers, if no test 
procedure has been established for the product; or (2) if DOE 
determines, by rule that such standard is not technologically feasible 
or economically justified. (42 U.S.C. 6295(o)(3)(A)-(B) and 6313(d)(4)) 
In deciding whether a proposed standard is economically justified, DOE 
must determine whether the benefits of the standard exceed its burdens. 
(42 U.S.C. 6295(o)(2)(B)(i) and 6313(d)(4)) DOE must make this 
determination after receiving comments on the proposed standard, and by 
considering, to the greatest extent practicable, the following seven 
factors:

    1. The economic impact of the standard on manufacturers and 
consumers of the equipment subject to the standard;
    2. The savings in operating costs throughout the estimated 
average life of the covered equipment in the type (or class) 
compared to any increase in the price, initial charges, or 
maintenance expenses for the covered equipment that are likely to 
result from the imposition of the standard;
    3. The total projected amount of energy, or as applicable, 
water, savings likely to result directly from the imposition of the 
standard;
    4. Any lessening of the utility or the performance of the 
covered equipment likely to result from the imposition of the 
standard;
    5. The impact of any lessening of competition, as determined in 
writing by the U.S. Attorney General (Attorney General), that is 
likely to result from the imposition of the standard;
    6. The need for national energy and water conservation; and
    7. Other factors the Secretary considers relevant.

(42 U.S.C. 6295(o)(2)(B)(i)(I)-(VII) and 6313(d)(4))
    EPCA, as codified, also contains what is known as an ``anti-
backsliding'' provision, which prevents the Secretary from prescribing 
any amended standard that either increases the maximum allowable energy 
use or decreases the minimum required energy efficiency of covered 
equipment. (42 U.S.C. 6295(o)(1) and 6313(d)(4)) Also, the Secretary 
may not prescribe an amended or new standard if interested persons have 
established by a preponderance of the evidence that the standard is 
likely to result in the unavailability in the United States of any 
covered product type (or class) of performance characteristics 
(including reliability), features, sizes, capacities, and volumes that 
are substantially the same as those generally available in the United 
States. (42 U.S.C. 6295(o)(4) and 6313(d)(4))
    Further, EPCA, as codified, establishes a rebuttable presumption 
that a standard is economically justified if the Secretary finds that 
the additional cost to the consumer of purchasing a product complying 
with an energy conservation standard level will be less than three 
times the value of the energy savings during the first year that the 
consumer will receive as a result of the standard, as calculated under 
the applicable test procedure. 42 U.S.C. 6295(o)(2)(B)(iii) and 
6313(d)(4) Section III.E.2 presents additional discussion about the 
rebuttable presumption payback period.
    Additionally, 42 U.S.C. 6295(q)(1) and 6316(a) specifies 
requirements when promulgating a standard for a type or class of 
covered equipment that has two or more subcategories that may justify 
different standard levels. DOE must specify a different standard level 
than that which applies generally to such type or class of equipment 
for any group of covered products that has the same function or 
intended use if DOE determines that products within such group (A) 
consume a different kind of energy from that consumed by other covered 
equipment within such type (or class); or (B) have a capacity or other 
performance-related feature that other equipment within such type (or 
class) do not have and such feature justifies a higher or lower 
standard. (42 U.S.C. 6295(q)(1)) and 6316(a)) In determining whether a 
performance-related feature justifies a different standard for a group 
of equipment, DOE must consider such factors as the utility to the 
consumer of the feature and other factors DOE deems appropriate. Id. 
Any rule prescribing such a standard must include an explanation of the 
basis on which such higher or lower level was established. (42 U.S.C. 
6295(q)(2)) and 6316(a))
    Federal energy conservation requirements generally supersede State 
laws or regulations concerning energy conservation testing, labeling, 
and standards. (42 U.S.C. 6297(a)-(c) and 6316(f)) DOE may, however, 
grant waivers of Federal preemption for particular State laws or 
regulations in accordance with the test procedures and other provisions 
set forth under 42 U.S.C. 6297(d) and 6316(f).

B. Background

1. Current Standards
    In a final rule published on October 18, 2005, DOE adopted the 
energy conservation standards and water conservation standards 
prescribed by EPCA in 42 U.S.C. 6313(d)(1) for certain automatic 
commercial ice makers manufactured on or after January 1, 2010. 70 FR 
60407, 60415-16. These standards consist of maximum energy use and 
maximum condenser water use to produce 100 pounds of ice for automatic 
commercial ice makers with harvest rates between 50 and 2,500 lb ice/24 
hours. These standards appear at 10 CFR part 431, subpart H, Automatic 
Commercial Ice Makers. Table II.1 presents DOE's current energy 
conservation standards for automatic commercial ice makers.

               Table II.1--Automatic Commercial Ice Makers Standards Prescribed by EPCA--Compliance Required Beginning on January 1, 2010
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                             Maximum energy use  kWh/100    Maximum condenser  water use
         Equipment type                Type of cooling       Harvest rate  lb ice/24 hours              lb ice                   *  gal/100 lb ice
--------------------------------------------------------------------------------------------------------------------------------------------------------
Ice-Making Head.................  Water...................  =500 and =1,436                         4.0                            200-0.022H.
                                  Air.....................  =450                           6.89-0.0011H                   Not Applicable.
Remote Condensing (but not        Air.....................  =1,000                         5.10                           Not Applicable.
Remote Condensing and Remote      Air.....................  =934                           5.30                           Not Applicable.
Self-Contained..................  Water...................  =200                           7.60                           191-0.0315H.
                                  Air.....................  =175                           9.80                           Not Applicable.
--------------------------------------------------------------------------------------------------------------------------------------------------------
Source: 42 U.S.C. 6313(d).
* Water use is for the condenser only and does not include potable water used to make ice.
** H = harvest rate in pounds per 24 hours, indicating the water or energy use for a given harvest rate.

2. History of Standards Rulemaking for Automatic Commercial Ice Makers
    As stated above, EPCA prescribes energy conservation standards and 
water conservation standards for certain cube type automatic commercial 
ice makers with harvest rates between 50 and 2,500 lb ice/24 hours: 
Self-contained ice makers and ice-making heads (IMHs) using air or 
water for cooling and ice makers with remote condensing with or without 
a remote compressor. Compliance with these standards was required as of 
January 1, 2010. (42 U.S.C. 6313(d)(1)) DOE adopted these standards and 
placed them under 10 CFR part 431, subpart H, Automatic Commercial Ice 
Makers.
    In addition, EPCA requires DOE to conduct a rulemaking to determine 
whether to amend the standards established under 42 U.S.C. 6313(d)(1), 
and if DOE determines that amendment is warranted, DOE must also issue 
a final rule establishing such amended standards by January 1, 2015. 
(42 U.S.C. 6313(d)(3)(A))
    Furthermore, EPCA granted DOE authority to set standards for 
additional types of automatic commercial ice makers that are not 
covered in 42 U.S.C. 6313(d)(1). (42 U.S.C. 6313(d)(2)(A)) Additional 
types of automatic commercial ice makers DOE identified as candidates 
for standards to be established in this rulemaking include flake and 
nugget, as well as batch type ice makers that are not included in the 
EPCA definition of cube type ice makers.
    To satisfy its requirement to conduct a rulemaking, DOE initiated 
the current rulemaking on November 4, 2010 by publishing on its Web 
site its ``Rulemaking Framework for Automatic Commercial Ice Makers.'' 
The Framework document is available at: http://www.regulations.gov/#!documentDetail;D=EERE-2010-BT-STD-0037-0024.
    DOE also published a notice in the Federal Register announcing the 
availability of the Framework document, as well as a public meeting to 
discuss the document. The notice also solicited comment on the matters 
raised in the document. 75 FR 70852 (Nov. 19, 2010). The Framework 
document described the procedural and analytical approaches that DOE 
anticipated using to evaluate amended standards for automatic 
commercial ice makers, and identified various issues to be resolved in 
the rulemaking.
    DOE held the Framework public meeting on December 16, 2010, at 
which it: (1) Presented the contents of the Framework document; (2) 
described the analyses it planned to conduct during the rulemaking; (3) 
sought comments from interested parties on these subjects; and (4) in 
general, sought to inform interested parties about, and facilitate 
their involvement in, the rulemaking. Major issues discussed at the 
public meeting included: (1) The scope of coverage for the rulemaking; 
(2) equipment classes; (3) analytical approaches and methods used in 
the rulemaking; (4) impacts of standards and burden on manufacturers; 
(5) technology options; (6) distribution channels, shipments, and end 
users; (7) impacts of outside regulations; and (8) environmental 
issues. At the meeting and during the comment period on the Framework 
document, DOE received many comments that helped it identify and 
resolve issues pertaining to automatic commercial ice makers relevant 
to this rulemaking.
    DOE then gathered additional information and performed preliminary 
analyses to help review standards for this equipment. This process 
culminated in DOE publishing a notice of another public meeting (the 
January 2012 notice) to discuss and receive comments regarding the 
tools and methods DOE used in performing its preliminary analysis, as 
well as the analyses results. 77 FR 3404 (Jan. 24, 2012) DOE also 
invited written comments on these subjects and announced the 
availability on its Web site of a preliminary analysis technical 
support document (preliminary analysis TSD). Id. The preliminary 
analysis TSD is available at: www.regulations.gov/#!documentDetail;D=EERE-2010-BT-STD-0037-0026. DOE sought comments 
concerning other relevant issues that could affect amended standards 
for automatic commercial ice makers. Id.
    The preliminary analysis TSD provided an overview of DOE's review 
of the standards for automatic commercial ice makers, discussed the 
comments DOE received in response to the Framework document, and 
addressed issues including the scope of coverage of the rulemaking. The 
document also described the analytical framework that DOE used (and 
continues to use) in considering amended standards for automatic 
commercial ice makers, including a description of the methodology, the 
analytical tools, and the relationships between the various analyses 
that are part of this rulemaking. Additionally, the preliminary 
analysis TSD presented in detail each analysis that DOE had performed 
for this equipment up to that point, including descriptions of inputs, 
sources, methodologies, and results. These analyses were as follows: 
(1) A market and technology assessment, (2) a screening analysis, (3) 
an engineering analysis, (4) an energy and water use analysis, (5) a 
markups analysis, (6) a

[[Page 4654]]

life-cycle cost analysis, (7) a payback period analysis, (8) a 
shipments analysis, (9) a national impact analysis (NIA) and (10) a 
preliminary manufacturer impact analysis (MIA).
    The public meeting announced in the January 2012 notice took place 
on February 16, 2012 (February 2012 preliminary analysis public 
meeting). At the February 2012 preliminary analysis public meeting, DOE 
presented the methodologies and results of the analyses set forth in 
the preliminary analysis TSD. Interested parties provided comments on 
the following issues: (1) Equipment classes; (2) technology options; 
(3) energy modeling and validation of engineering models; (4) cost 
modeling; (5) market information, including distribution channels and 
distribution markups; (6) efficiency levels; (7) life-cycle costs to 
customers, including installation, repair and maintenance costs, and 
water and wastewater prices; and (8) historical shipments.
    On March 17, 2014, DOE published a notice of proposed rulemaking 
(NOPR) in the Federal Register (March 2014 NOPR). 79 FR 14846. In the 
March 2014 NOPR, DOE addressed, in detail, the comments received in 
earlier stages of rulemaking, and proposed amended energy conservation 
standards for automatic commercial ice makers. In conjunction with the 
March 2014 NOPR, DOE also published on its Web site the complete 
technical support document (TSD) for the proposed rule, which 
incorporated the analyses DOE conducted and technical documentation for 
each analysis. Also published on DOE's Web site were the engineering 
analysis spreadsheets, the LCC spreadsheet, and the national impact 
analysis standard spreadsheet. These materials are available at: http://www1.eere.energy.gov/buildings/appliance_standards/rulemaking.aspx/ruleid/29.
    The standards which DOE proposed for automatic commercial ice 
makers at the NOPR stage of this rulemaking are shown in Table II.2 and 
Table II.3. They are provided solely for background informational 
purposes and differ from the amended standards set forth in this final 
rule.

                            Table II.2--Proposed Energy Conservation Standards for Batch Type Automatic Commercial Ice Makers
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                            Maximum energy use  kilowatt-   Maximum condenser  water use
         Equipment type                Type of cooling       Harvest rate  lb ice/24 hours     hours (kWh)/100 lb ice *          gal/100 lb ice **
--------------------------------------------------------------------------------------------------------------------------------------------------------
Ice-Making Head.................  Water...................  =500 and =1,436 and =2,500 and =450 and =875 and =2,210 and =2,500 and =1,000 and =934 and =200 and =2,500 and =175 and 100    Maximum condenser  water use
         Equipment type                Type of cooling       Harvest rate  lb ice/24 hours             lb ice *                  gal/100 lb ice **
--------------------------------------------------------------------------------------------------------------------------------------------------------
Ice-Making Head.................  Water...................  =900 and =2,500 and =700 and =850 and =850 and =900 and =2,500 and =700 and hour. 79 FR 14846 at 14947-
49. After the publication of the March 2014 NOPR, DOE received written 
comments on these and other issues. DOE also held a public meeting in 
Washington, DC, on April 14, 2014, to discuss and receive comments 
regarding the tools and methods DOE used in the NOPR analysis, as well 
as the results of the analysis. DOE also invited written comments and 
announced the availability of a NOPR analysis technical support 
document (NOPR TSD). The NOPR TSD is available at: http://www.regulations.gov/#!documentDetail;D=EERE-2010-BT-STD-0037-0061.
    The NOPR TSD described in detail DOE's analysis of potential 
standard levels for automatic commercial ice makers. The document also 
described the analytical framework used in considering standard levels, 
including a description of the methodology, the analytical tools, and 
the relationships between the various analyses. In addition, the NOPR 
TSD presented each analysis that DOE performed to evaluate automatic 
commercial ice makers, including descriptions of inputs, sources, 
methodologies, and results. DOE included the same analyses that were 
conducted at the preliminary analysis stage, with revisions based on 
comments received and additional research.
    At the public meeting held on April 14, 2014, DOE presented the 
methodologies and results of the analyses set for in the NOPR TSD. 
Interested parties provided comments. Key issues raised by stakeholders 
included: (1) Whether the energy model accurately predicts efficiency 
improvements; (2) the size restrictions and applications of 22-inch 
wide ice makers; (3) the efficiency distributions assumed for shipments 
of icemakers; and (4) the impact on manufacturers relating to design of 
icemaker models, in light of the proposed compliance date of 3 years 
after publication of the final rule.
    In response to comments regarding the energy model used in the 
analysis, DOE held a public meeting on June 19, 2014 in order to 
facilitate an additional review of the energy model, gather additional 
feedback and data on the energy model, and to allow for a more thorough 
explanation of DOE's use of the model in the engineering analysis. 79 
FR 33877 (June 13, 2014). At that meeting, DOE presented the energy 
model, demonstrated its operations, and described how it was used in 
the rulemaking's engineering analysis. DOE indicated in this meeting 
that it was considering modifications to its NOPR analyses based on the 
NOPR comments and additional research and information gathering.
    On September 11, 2014, DOE published a notice of data availability 
(NODA) in the Federal Register (September 2014 NODA). 79 FR 54215. The 
purpose of the September 2014 NODA was to notify industry, 
manufacturers, customer groups, efficiency advocates, government 
agencies, and other stakeholders of the publication of the updated 
rulemaking analysis for new and/or amended energy conservation 
standards for automatic ice makers. The comments received since the 
publication of the March 2014 NOPR, including those received at the 
April 2014 and the June 2014 public meetings, provided inputs which led 
DOE to revise its analysis. Stakeholders also submitted additional 
information to DOE's consultant pursuant to non-disclosure agreements 
regarding efficiency gains and costs of potential design options. DOE 
reviewed additional market data, including published ratings of 
available ice makers, to recalibrate its engineering analysis. 
Generally, the revisions to the NOPR analysis as specified in the NODA 
include modifications of inputs for its engineering, LCC, and NIA 
analyses, adjustments of its energy model calculations, and more 
thorough considerations of size-constrained ice maker applications. The 
analysis revisions addressing size-constrained applications include 
development of engineering analyses for three size-constrained 
equipment categories and restructuring of the LCC and NIA analyses to 
consider size constraints for applicable equipment classes. DOE 
encouraged stakeholders to provide comments and additional information 
in response to the September NODA publication.
    This final rule responds to the issues raised by commenters for the 
March 2014 NOPR and the September 2014 NODA.\18\
---------------------------------------------------------------------------

    \18\ A parenthetical reference at the end of a quotation or 
paraphrase provides the location of the item in the public record.
---------------------------------------------------------------------------

III. General Discussion

A. Equipment Classes and Scope of Coverage

    When evaluating and establishing energy conservation standards, DOE 
divides covered equipment into equipment classes by the type of energy 
use or by capacity or other performance-related features that justifies 
a different standard. In making a determination whether a performance-
related feature justifies a different standard, DOE must consider such 
factors as the utility to the consumer of the feature and other factors 
DOE determines are appropriate. (42 U.S.C. 6295(q)) and 6316(a))
    Throughout this rulemaking, DOE's analysis has been based on a set 
of equipment classes derived from the existing DOE batch commercial ice 
maker standards, effective as of January 1, 2010 (42 U.S.C. 6313(d)(1)) 
and review of the existing ice maker market. These equipment classes 
form the basis of analysis and public comments. In this final rule, 
equipment class names are frequently abbreviated. These abbreviations 
are shown on Table III.1.

                               Table III.1--List of Equipment Class Abbreviations
----------------------------------------------------------------------------------------------------------------
                                                                       Harvest rate  lb ice/24
        Abbreviation             Equipment type      Condenser type             hours                Ice type
----------------------------------------------------------------------------------------------------------------
IMH-W-Small-B...............  Ice-Making Head.....  Water..........  =500 and =1,436 and =450 and =875 and =1,000 and =934 and =200 and =175 and =900 and =700 and =850 and =850 and =900 and =700 and 24 hours. In this rule,
  DOE analyzed this class as two ranges, which could either be considered ``Large'' and ``Very Large'' or
  ``Medium'' and ``Large.'' In the LCC and NIA modeling, this was denoted as B-1 and B-2.

B. Test Procedure

    On December 8, 2006, DOE published a final rule in which it 
incorporated by reference Air-Conditioning and Refrigeration Institute 
(ARI) Standard 810-2003, ``Performance Rating of Automatic Commercial 
Ice Makers,'' with a revised method for calculating energy use, as the 
DOE test procedure for this equipment. 71 FR 71340. The DOE rule 
included a clarification to the energy use rate equation to specify 
that the energy use be calculated using the entire mass of ice produced 
during the testing period, normalized to 100 lb ice produced. Id. at 
71350. ARI Standard 810-2003 requires performance tests to be conducted 
according to the American National Standards Institute (ANSI)/American 
Society of Heating, Refrigerating, and Air-Conditioning Engineers 
(ASHRAE) Standard 29-1988 (reaffirmed 2005), ``Method of Testing 
Automatic Ice Makers.'' The DOE test procedure also incorporated by 
reference the ANSI/ASHRAE Standard 29-1988 (Reaffirmed 2005) as the 
method of test.
    On January 11, 2012, DOE published a test procedure final rule 
(2012 test procedure final rule) in which it adopted several amendments 
to the DOE test procedure. 77 FR 1591. The 2012 test procedure final 
rule included an amendment to incorporate by reference Air-
Conditioning, Heating, and Refrigeration Institute (AHRI) Standard 810-
2007 with Addendum 1 \19\ as the DOE test procedure for this equipment. 
AHRI Standard 810-2007 with Addendum 1 amends ARI Standard 810-2003 to 
expand the capacity range of covered equipment, provide definitions and 
specific test procedures for batch and continuous type ice makers, 
provide a definition for ice hardness factor, and incorporate several 
new or amended definitions regarding how water consumption and capacity 
are measured, particularly for continuous type machines. 77 FR at 1592-
93. The 2012 test procedure final rule also included an amendment to 
incorporate by reference the updated ANSI/ASHRAE Standard 29-2009. Id. 
at 1613.
---------------------------------------------------------------------------

    \19\ In March 2011, AHRI published Addendum 1 to Standard 810-
2007, which revised the definition of ``potable water use rate'' and 
added new definitions for ``purge or dump water'' and ``harvest 
water.''
---------------------------------------------------------------------------

    In addition, the 2012 test procedure final rule included several 
amendments designed to address issues that were not accounted for by 
the previous DOE test procedure. 77 FR at 1593 (Jan. 11, 2012). First, 
DOE expanded the scope of the test procedure to include equipment with 
capacities from 50 to 4,000 lb ice/24 hours.\20\ DOE also adopted

[[Page 4657]]

amendments to provide test methods for continuous type ice makers and 
to standardize the measurement of energy and water use for continuous 
type ice makers with respect to ice hardness. In the 2012 test 
procedure final rule, DOE also clarified the test method and reporting 
requirements for remote condensing automatic commercial ice makers 
designed for connection to remote compressor racks. Finally, the 2012 
test procedure final rule discontinued the use of the clarified energy 
use rate calculation and instead required energy-use to be calculated 
per 100 lb ice as specified in ANSI/ASHRAE Standard 29-2009. The 2012 
test procedure final rule became effective on February 10, 2012, and 
the changes set forth in the final rule became mandatory for equipment 
testing starting January 7, 2013. 77 FR 1591.
---------------------------------------------------------------------------

    \20\ EPCA defines automatic commercial ice maker under 42 U.S.C. 
6311(19) as ``a factory-made assembly (not necessarily shipped in 1 
package) that--(A) Consists of a condensing unit and ice-making 
section operating as an integrated unit, with means for making and 
harvesting ice; and (B) May include means for storing ice, 
dispensing ice, or storing and dispensing ice.'' 42 U.S.C. 
6313(d)(1) explicitly sets standards for cube type ice makers up to 
2,500 lb ice/24 hours, however, 6313(d)(2) establishes authority to 
set standards for other equipment types, such as those with 
capacities greater than 2,500 lb ice/24 hours, provided the 
equipment types meet the EPCA definition of an automatic commercial 
ice maker.
---------------------------------------------------------------------------

    The test procedure amendments established in the 2012 test 
procedure final rule are required to be used in conjunction with new 
and amended standards promulgated as a result of this standards 
rulemaking. Thus, manufacturers must use the amended test procedure to 
demonstrate compliance with the new and amended energy conservation 
standards on the compliance date of any energy conservation standards 
established as part of this rulemaking. 77 FR at 1593 (Jan. 11, 2012).

C. Technological Feasibility

1. General
    In each energy conservation standards rulemaking, DOE conducts a 
screening analysis, which is based on information that the Department 
has gathered on all current technology options and prototype designs 
that could improve the efficiency of the products or equipment that are 
the subject of the rulemaking. As the first step in such analysis, DOE 
develops a list of design options for consideration, in consultation 
with manufacturers, design engineers, and other interested parties. DOE 
then determines which of these options for improving efficiency are 
technologically feasible. DOE considers a design option to be 
technologically feasible if it is used by the relevant industry or if a 
working prototype has been developed. Technologies incorporated in 
commercially available equipment or in working prototypes were 
considered technologically feasible. 10 CFR part 430, subpart C, 
appendix A, section 4(a)(4)(i) Although DOE considers technologies that 
are proprietary, it will not consider efficiency levels that can only 
be reached through the use of proprietary technologies (i.e., a unique 
pathway), which could allow a single manufacturer to monopolize the 
market.
    Once DOE has determined that particular design options are 
technologically feasible, DOE further evaluates each of these design 
options in light of the following additional screening criteria: (1) 
Practicability to manufacture, install, or service; (2) adverse impacts 
on equipment utility or availability; and (3) adverse impacts on health 
or safety. 10 CFR part 430, subpart C, appendix A, section 4(a)(4)(ii)-
(iv) Chapter 4 of the final rule TSD discusses the results of the 
screening analyses for automatic commercial ice makers. Specifically, 
it presents the designs DOE considered, those it screened out, and 
those that are the bases for the TSLs considered in this rulemaking.
2. Maximum Technologically Feasible Levels
    When DOE adopts (or does not adopt) an amended or new energy 
conservation standard for a type or class of covered equipment such as 
automatic commercial ice makers, it determines the maximum improvement 
in energy efficiency that is technologically feasible for such 
equipment. (See 42 U.S.C. 6295(p)(1) and 6313(d)(4)) Accordingly, DOE 
determined the maximum technologically feasible (``max-tech'') 
improvements in energy efficiency for automatic commercial ice makers 
in the engineering analysis using the design options that passed the 
screening analysis.
    As indicated previously, whether efficiency levels exist or can be 
achieved in commonly used equipment is not relevant to whether they are 
considered max-tech levels. DOE considers technologies to be 
technologically feasible if they are incorporated in any currently 
available equipment or working prototypes. Hence, a max-tech level 
results from the combination of design options predicted to result in 
the highest efficiency level possible for an equipment class, with such 
design options consisting of technologies already incorporated in 
automatic commercial ice makers or working prototypes. DOE notes that 
it reevaluated the efficiency levels, including the max-tech levels, 
when it updated its results for the NODA and final rule. See chapter 5 
of the final rule TSD for the results of the analyses and a list of 
technologies included in max-tech equipment. Table III.2 and Table 
III.3 shows the max-tech levels determined in the engineering analysis 
for batch and continuous type automatic commercial ice makers, 
respectively.

     Table III.2--Final Rule ``Max-Tech'' Levels for Batch Automatic
                          Commercial Ice Makers
------------------------------------------------------------------------
           Equipment type *              Energy use lower than baseline
------------------------------------------------------------------------
IMH-W-Small-B........................  23.9%, 21.5% (22-inch wide).
IMH-W-Med-B..........................  18.1%.
IMH-W-Large-B........................  8.3% (at 1,500 lb ice/24 hours),
                                        7.4% (at 2,600 lb ice/24 hours).
IMH-A-Small-B........................  25.5%, 18.1% (22-inch wide).
IMH-A-Large-B........................  23.4% (at 800 lb ice/24 hours),
                                        15.8% (at 590 lb ice/24 hours,
                                        22-inch wide), 11.8% (at 1,500
                                        lb ice/24 hours).
RCU-Small-B..........................  Not directly analyzed.
RCU-Large-B..........................  17.3% (at 1,500 lb ice/24 hours),
                                        13.9% (at 2,400 lb ice/24
                                        hours).
SCU-W-Small-B........................  Not directly analyzed.
SCU-W-Large-B........................  29.8%.
SCU-A-Small-B........................  32.7%.
SCU-A-Large-B........................  29.1%.
------------------------------------------------------------------------
* IMH is ice-making head; RCU is remote condensing unit; SCU is self-
  contained unit; W is water-cooled; A is air-cooled; Small refers to
  the lowest harvest category; Med refers to the Medium category (water-
  cooled IMH only); Large refers to the large size category; RCU units
  were modeled as one with line losses used to distinguish standards.
Note: For equipment classes that were not analyzed, DOE did not develop
  specific cost-efficiency curves but attributed the curve (and maximum
  technology point) from one of the analyzed equipment classes.

[[Page 4658]]

  Table III.3--Final Rule ``Max-Tech'' Levels for Continuous Automatic
                          Commercial Ice Makers
------------------------------------------------------------------------
            Equipment type *              Energy use lower than baseline
------------------------------------------------------------------------
IMH-W-Small-C..........................  Not directly analyzed.
IMH-W-Large-C..........................  Not directly analyzed.
IMH-A-Small-C..........................  25.7%.
IMH-A-Large-C..........................  23.3% lb ice.
RCU-Small-C............................  26.6%.
RCU-Large-C............................  Not directly analyzed.
SCU-W-Small-C..........................  Not directly analyzed.
SCU-W-Large-C *........................  No units available.
SCU-A-Small-C..........................  26.6%.
SCU-A-Large-C *........................  No units available.
------------------------------------------------------------------------
* DOE's investigation of equipment on the market revealed that there are
  no existing products in either of these two equipment classes (as
  defined in this final rule).
Note: For equipment classes that were not analyzed, DOE did not develop
  specific cost-efficiency curves but attributed the curve (and maximum
  technology point) from one of the analyzed equipment classes.

D. Energy Savings

1. Determination of Savings
    For each TSL, DOE projected energy savings from automatic 
commercial ice makers purchased during a 30-year period that begins in 
the year of compliance with amended standards (2018-2047). The savings 
are measured over the entire lifetime of products purchased in the 30-
year period. DOE used the NIA model to estimate the national energy 
savings (NES) for equipment purchased over the period 2018-2047. The 
model forecasts total energy use over the analysis period for each 
representative equipment class at efficiency levels set by each of the 
considered TSLs. DOE then compares the energy use at each TSL to the 
base-case energy use to obtain the NES. The NIA model is described in 
section IV.H of this rule and in chapter 10 of the final rule TSD.
    DOE used its NIA spreadsheet model to estimate energy savings from 
amended standards for automatic commercial ice makers. The NIA 
spreadsheet model (described in section IV.H of this preamble) 
calculates energy savings in site energy, which is the energy directly 
consumed by products at the locations where they are used.
    Because automatic commercial ice makers use water, water savings 
were quantified in the same way as energy savings.
    For electricity, DOE reports national energy savings in terms of 
the savings in the energy that is used to generate and transmit the 
site electricity. To calculate this quantity, DOE derives annual 
conversion factors from the model used to prepare the Energy 
Information Administration's (EIA) AEO.
    DOE also has begun to estimate full-fuel-cycle energy savings. 76 
FR 51282 (August 18, 2011), as amended by 77 FR 49701 (August 17, 
2012). The full-fuel-cycle (FFC) metric includes the energy consumed in 
extracting, processing, and transporting primary fuels, and thus 
presents a more complete picture of the impacts of energy efficiency 
standards. DOE's approach is based on calculations of an FFC multiplier 
for each of the fuels used by automatic commercial ice makers.
2. Significance of Savings
    EPCA prohibits DOE from adopting a standard that would not result 
in significant additional energy savings. (42 U.S.C. 6295(o)(3)(B) and 
6313(d)(4)While the term ``significant'' is not defined in EPCA, the 
U.S. Court of Appeals for the District of Columbia in Natural Resources 
Defense Council v. Herrington, 768 F.2d 1355, 1373 (D.C. Cir. 1985), 
indicated that Congress intended significant energy savings to be 
savings that were not ``genuinely trivial.'' The energy savings for all 
of the TSLs considered in this rulemaking (presented in section 
V.B.3.a) are nontrivial, and, therefore, DOE considers them 
``significant'' within the meaning of section 325 of EPCA.

E. Economic Justification

1. Specific Criteria
    As discussed in section III.E.1, EPCA provides seven factors to be 
evaluated in determining whether a potential energy conservation 
standard is economically justified. (42 U.S.C. 6295(o)(2)(B)(i) and 
6313(d)(4) The following sections generally discuss how DOE is 
addressing each of those seven factors in this rulemaking. For further 
details and the results of DOE's analyses pertaining to economic 
justification, see sections IV and V of this rule.
a. Economic Impact on Manufacturers and Commercial Customers
    In determining the impacts of a potential new or amended energy 
conservation standard on manufacturers, DOE first determines its 
quantitative impacts using an annual cash flow approach. This includes 
both a short-term assessment (based on the cost and capital 
requirements associated with new or amended standards during the period 
between the announcement of a regulation and the compliance date of the 
regulation) and a long-term assessment (based on the costs and marginal 
impacts over the 30-year analysis period). The impacts analyzed include 
INPV (which values the industry based on expected future cash flows), 
cash flows by year, changes in revenue and income, and other measures 
of impact, as appropriate. Second, DOE analyzes and reports the 
potential impacts on different types of manufacturers, paying 
particular attention to impacts on small manufacturers. Third, DOE 
considers the impact of new or amended standards on domestic 
manufacturer employment and manufacturing capacity, as well as the 
potential for new or amended standards to result in plant closures and 
loss of capital investment. Finally, DOE takes into account cumulative 
impacts of other DOE regulations and non-DOE regulatory requirements on 
manufacturers.
    For individual customers, measures of economic impact include the 
changes in LCC and the PBP associated with new or amended standards. 
These measures are discussed further in the following section. For 
consumers in the aggregate, DOE also calculates the national net 
present value of the economic impacts applicable to a particular 
rulemaking.

[[Page 4659]]

DOE also evaluates the LCC impacts of potential standards on 
identifiable subgroups of consumers that may be affected 
disproportionately by a national standard.
b. Savings in Operating Costs Compared To Increase in Price (Life Cycle 
Costs)
    EPCA requires DOE to consider the savings in operating costs 
throughout the estimated average life of the covered product compared 
to any increase in the price of the covered product that are likely to 
result from the imposition of the standard. (42 U.S.C. 
6295(o)(2)(B)(i)(II) and 6313(d)(4) DOE conducts this comparison in its 
LCC and PBP analysis.
    The LCC is the sum of the purchase price of equipment (including 
the cost of its installation) and the operating costs (including energy 
and maintenance and repair costs) discounted over the lifetime of the 
equipment. To account for uncertainty and variability in specific 
inputs, such as product lifetime and discount rate, DOE uses a 
distribution of values, with probabilities attached to each value. For 
its analysis, DOE assumes that consumers will purchase the covered 
products in the first year of compliance with amended standards.
    The LCC savings and the PBP for the considered efficiency levels 
are calculated relative to a base-case scenario, which reflects likely 
trends in the absence of new or amended standards. DOE identifies the 
percentage of consumers estimated to receive LCC savings or experience 
an LCC increase, in addition to the average LCC savings associated with 
a particular standard level. DOE's LCC and PBP analysis is discussed in 
further detail in section IV.G.
c. Energy Savings
    While significant conservation of energy is a statutory requirement 
for imposing an energy conservation standard, EPCA also requires DOE, 
in determining the economic justification of a standard, to consider 
the total projected energy savings that are expected to result directly 
from the standard. (42 U.S.C. 6295(o)(2)(B)(i)(III) and 6313(d)(4)) DOE 
uses NIA spreadsheet results in its consideration of total projected 
savings. For the results of DOE's analyses related to the potential 
energy savings, see section IV.H of this preamble and chapter 10 of the 
final rule TSD.
d. Lessening of Utility or Performance of Equipment
    In establishing classes of equipment, and in evaluating design 
options and the impact of potential standard levels, DOE seeks to 
develop standards that would not lessen the utility or performance of 
the equipment under consideration. DOE has determined that none of the 
TSLs presented in today's final rule would reduce the utility or 
performance of the equipment considered in the rulemaking. (42 U.S.C. 
6295(o)(2)(B)(i)(IV) and 6313(d)(4)) During the screening analysis, DOE 
eliminated from consideration any technology that would adversely 
impact customer utility. For the results of DOE's analyses related to 
the potential impact of amended standards on equipment utility and 
performance, see section IV.C of this preamble and chapter 4 of the 
final rule TSD.
e. Impact of Any Lessening of Competition
    EPCA requires DOE to consider any lessening of competition that is 
likely to result from setting new or amended standards for covered 
equipment. Consistent with its obligations under EPCA, DOE sought the 
views of the United States Department of Justice (DOJ). DOE asked DOJ 
to provide a written determination of the impact, if any, of any 
lessening of competition likely to result from the amended standards, 
together with an analysis of the nature and extent of such impact. 42 
U.S.C. 6295(o)(2)(B)(i)(V) and (B)(ii). DOE transmitted a copy of its 
proposed rule to the Attorney General with a request that the 
Department of Justice (DOJ) provide its determination on this issue. 
DOJ's response, that the proposed energy conservation standards are 
unlikely to have a significant adverse impact on competition, is 
reprinted at the end of this rule.
f. Need of the Nation To Conserve Energy
    Another factor that DOE must consider in determining whether a new 
or amended standard is economically justified is the need for national 
energy and water conservation. (42 U.S.C. 6295(o)(2)(B)(i)(VI) and 
6313(d)(4))) The energy savings from new or amended standards are 
likely to provide improvements to the security and reliability of the 
Nation's energy system. Reductions in the demand for electricity may 
also result in reduced costs for maintaining the reliability of the 
Nation's electricity system. DOE conducts a utility impact analysis to 
estimate how new or amended standards may affect the Nation's needed 
power generation capacity, as discussed in section IV.M.
    Amended standards also are likely to result in environmental 
benefits in the form of reduced emissions of air pollutants and 
greenhouse gases associated with energy production and use. DOE 
conducts an emissions analysis to estimate how standards may affect 
these emissions, as discussed in section IV.K. DOE reports the 
emissions impacts from each TSL it considered, in section V.B.6 of this 
rule. DOE also estimates the economic value of emissions reductions 
resulting from the considered TSLs, as discussed in section IV.L.
g. Other Factors
    EPCA allows the Secretary, in determining whether a new or amended 
standard is economically justified, to consider any other factors that 
the Secretary deems to be relevant. (42 U.S.C. 6295(o)(2)(B)(i)(VII) 
and 6313(d)(4)) There were no other factors considered for this final 
rule.
2. Rebuttable Presumption
    As set forth in 42 U.S.C. 6295(o)(2)(B)(iii) and 6313(d)(4), EPCA 
provides for a rebuttable presumption that an energy conservation 
standard is economically justified if the additional cost to the 
customer of equipment that meets the new or amended standard level is 
less than three times the value of the first-year energy (and, as 
applicable, water) savings resulting from the standard, as calculated 
under the applicable DOE test procedure. DOE's LCC and PBP analyses 
generate values that calculate the PBP for customers of potential new 
and amended energy conservation standards. These analyses include, but 
are not limited to, the 3-year PBP contemplated under the rebuttable 
presumption test. However, DOE routinely conducts a full economic 
analysis that considers the full range of impacts to the customer, 
manufacturer, Nation, and environment, as required under 42 U.S.C. 
6295(o)(2)(B)(i) and 6313(d)(4). The results of these analyses serve as 
the basis for DOE to evaluate the economic justification for a 
potential standard level (thereby supporting or rebutting the results 
of any preliminary determination of economic justification). The 
rebuttable presumption payback calculation is discussed in section 
IV.G.12 of this rule and chapter 8 of the final rule TSD.

IV. Methodology and Discussion of Comments

A. General Rulemaking Issues

    During the April 2014 and June 2014 public meetings, and in 
subsequent written comments in response to the NOPR and NODA, 
stakeholders provided input regarding general issues

[[Page 4660]]

pertinent to the rulemaking, such as issues regarding proposed standard 
levels and the compliance date. These issues are discussed in this 
section.
1. Proposed Standard Levels
    In response to the level proposed in the NOPR (TSL 3), Manitowoc 
commented that there are significant deficiencies in the models and 
cost assumptions that were used to arrive at the proposed efficiency 
levels and that, consequently, the selected levels are not optimal from 
a life-cycle cost standpoint. (Manitowoc, Public Meeting Transcript, 
No. 70 at p. 24-26) Follett commented that DOE is recommending 
efficiency levels that are neither technologically nor economically 
justified. (Follett, No. 84 at p. 8)
    Hoshizaki and Scotsman both recommended DOE select NOPR TSL 1 
(Hoshizaki, No. 86 at p. 5-6; Scotsman, Public Meeting Transcript, No. 
70 Public Meeting Transcript, at p. 44-46) Scotsman stated that doing 
so effective 2020 is technologically feasible, economically justified, 
consistent with past regulations, and will save a significant amount of 
energy. (Scotsman, Public Meeting Transcript, Public Meeting 
Transcript, No. 70 at p. 44-46) Although the following comment 
regarding choosing a standard level mentioned ``ELs,'' efficiency 
levels, DOE believes Hoshizaki intended that this comment refer to 
``TSLs,'' trial standard levels levels and DOE has interpreted the 
comment accordingly. Hoshizaki stated that NOPR EL1 (interpreted as 
TSL1) would garner similar savings as NOPR EL3 (interpreted as TSL3) 
while reducing the burden on the industry to meet such stringent 
standards in such a short amount of time. (Hoshizaki, No. 86 at p. 5-6)
    Scotsman stated that they have not identified technology 
combinations that are suitable for achieving any efficiency level 
beyond NOPR TSL 1. (Scotsman, No. 85 at p. 8b) Scotsman added that they 
do not have data indicating that their machines will be able to meet 
NOPR TSL 3 using the design options under consideration. (Scotsman, No. 
85 at p. 7b)
    Pacific Gas and Electric Company (PG&E) and San Diego Gas and 
Electric Company (SDG&E), commenting jointly, and a group including the 
Appliance Standards Awareness Project (ASAP), the American Council for 
an Energy-Efficient Economy (ACEEE), the Alliance to Save Energy, 
Natural Resources Defense Council (NRDC), and the Northwest Power and 
Conservation Council (NPCC) (Joint Commenters) both recommended that 
DOE adopt a higher TSL for ACIMs. (Joint Commenters, No. 87 at p. 1-2; 
PG&E and SDG&E, No. 89 at p. 1-2) ASAP noted that based on their review 
of the certification database, there are products existing on the 
market today that meet the proposed standard levels. (ASAP, Public 
Meeting Transcript, No. 70 at p. 50-52) Joint Commenters urged DOE to 
adopt TSL 5 for batch type equipment and TSL 4 for continuous type 
equipment. (Joint Commenters, No. 87 at p. 1-2) PG&E and SDG&E 
recommended that DOE adopt the maximum cost-effective TSL for each 
equipment class noting that DOE could adopt TSLs higher than TSL 3 
while maintaining a net benefit to U.S. consumers. (PG&E and SDG&E, No. 
89 at p. 1-2)
    Although the NODA only provided data regarding the updated analysis 
and did not propose a standard level, several interested parties 
provided comment regarding the appropriateness of setting the ACIM 
energy conservation standard at a given NODA TSL.
    In their written comment, Manitowoc stated that the NODA analysis 
was an improvement over the original NOPR analysis. Manitowoc stated 
that they did not believe the standard should be set at a single TSL 
level for all equipment classes and suggested a different TSL level for 
each equipment class. Although the following comments regarding 
specific classes mention ``ELs,'' efficiency levels, DOE believes 
Manitowoc intended that these comments apply to ``TSLs,'' trial 
standard levels and DOE has interpreted the comment accordingly. For 
IMH-A batch equipment with package widths less than 48 inches (the 48-
inch corresponds to the 1,500 lb ice/24 hour representative capacity), 
Manitowoc supported an efficiency level no higher than EL 3 
(interpreted as TSL3). Manitowoc suggested that DOE adopt a standard 
that would be limited to 5% improvement in efficiency over baseline for 
the IMH-A-B2 (48-inch wide) equipment. DOE believes Manitowoc's third 
point in the comments, citing the ``IMH-small'' class refers to IMH-W-
Small-B, for which Manitowoc indicated that the standard level should 
be set no higher than EL 3 (interpreted as TSL3). Manitowoc also 
suggested DOE adopt standards with efficiency gains no greater than 
4.7% and 3.7% efficiency gains, respectfully, for the MH-W-Large-B1 
(1,500 lb ice/24 hours representative capacity) and IMH-W-Large-B2 
(2,600 lb ice/24 hours representative capacity) equipment. Manitowoc 
suggested that DOE adopt EL 2 (interpreted as TSL2) for the RCU-NRC-B1 
(1,500 lb ice/24 hours representative capacity) and RCU-NRC-B2 (2,400 
lb ice/24 hours representative capacity) equipment, as well as the SCU-
A-Small and SCU-A-Large equipment classes and for 22-inch IMH 
equipment. For the RCU-NRC-Large-B1, Manitowoc indicated that the 20 
percent improvement in compressor energy efficiency ratio (EER) used in 
DOE's analysis for this equipment is unrealistic. For the RCU-NRC-
Large-B2, Manitowoc mentioned that the increase in condenser size 
considered in the DOE analysis would present significant issues with 
refrigerant charge management. For the SCU-A-Small-B class, Manitowoc 
indicated that the 40% improvement in compressor EER considered in 
DOE's analysis is not likely to be achieved and adding a tube row to 
the condenser may not be possible. For the SCU-A-Large-B class, 
Manitowoc similarly commented that the compressor EER improvement and 
condenser size increases considered in DOE's analyses are unrealistic. 
For the 22-inch IMH equipment, Manitowoc indicated that some of the 
considered design options (increase in evaporator size and/or a drain 
water heat exchanger) would not be feasible due to the compact nature 
of these units. Manitowoc suggested that DOE select EL 3 (interpreted 
as TSL3) for IMH-A-B small and large-1 batch equipment classes (not 
including 48'' models), as well as the IMH-Small equipment class and 
all other equipment classes not specifically mentioned. (Manitowoc, No. 
126 at p. 1-2)
    Ice-O-Matic requested that DOE select NODA TSL 3. (Ice-O-Matic, No. 
121 at p. 1) Scotsman suggested that DOE select NODA TSL 2. (Scotsman, 
No. 125 at p. 3) Hoshizaki suggested that DOE select NODA TSL 2 for 
batch units. (Hoshizaki, No. 124 at p. 3)
    ASAP encouraged DOE to adopt NODA TSL 5 for batch type remote 
condensing equipment and NODA TSL 4 for all other equipment classes, 
noting that these choices would be cost effective. (ASAP, No. 127 at p. 
1) CA IOU suggested that DOE adopt the NODA TSL for each equipment 
class that saves the most energy and has a positive NPV. CA IOU noted 
that DOE could adopt a level more stringent than NODA TSL 3 for all 
equipment classes while maintaining a net benefit to US consumers. (CA 
IOU, No. 129 at p. 1)
    DOE understands the concerns voiced by stakeholders regarding their 
future ability to meet standard levels as proposed in the NOPR. DOE 
must adhere to the EPCA guidelines for determining the appropriate 
level of standards that were outlined in sections III.E.1. In this 
Final Rule, DOE selected the TSL that best meets the EPCA

[[Page 4661]]

requirements for establishing that a standard is economically 
justified. (42 U.S.C. 6295(o)(2)(B)(i) and 6313(d)(4)). Since the 
publication of the NOPR, DOE has revised and updated its analysis based 
on stakeholders comments received at the NOPR public meeting, comments 
made during the June 19 meeting, and in written comments received in 
response to the NOPR and NODA. These updates included changes in its 
approach to calculating the energy use associated with groups of design 
options, changes in inputs for calculations of energy use and equipment 
manufacturing cost, and consideration of space-constrained 
applications. After applying these changes to the analyses, the 
efficiency levels that DOE determined to be cost effective changed 
considerably. The NODA comments described above reveal partial industry 
support for the standard levels chosen by DOE in the final rule.
    DOE notes that much of the commentary regarding the selection of 
efficiency levels for the standard are based on more detailed comments 
regarding the feasibility of design options, the savings that these 
design options can achieve, and their costs. DOE response regarding 
many of these comments is provided in section IV.D.3.
2. Compliance Date
    In the March 2014 NOPR analysis, DOE assumed a 3-year period for 
manufacturers to prepare for compliance. DOE requested comments as to 
whether a January 1, 2018 effective date provides an inadequate period 
for compliance and what economic impacts would be mitigated by a later 
effective date.
    Following the publication of the NOPR, several manufacturers and 
NAFEM expressed an expected inability to meet the proposed standard 
levels within the three year compliance period. (Manitowoc, No. 92 at 
p. 2-3, Scotsman, No. 85 at p. 2b, Hoshizaki, No. 86 at p. 2, NAFEM, 
No. 82 at pg. 2-3) Manitowoc and Hoshizaki both commented that a 5-year 
compliance period would be necessary for this rulemaking. (Manitowoc, 
No. 92 at p. 2-3; Hoshizaki, No. 86 at p. 2) Scotsman commented that an 
8-year compliance period would be more feasible for the technology 
specification, R&D investment, performance evaluation, reliability 
evaluation, and manufacturing required for product redesign. Scotsman 
added that the negative economic impacts of the rule would be mitigated 
by a later effective date. (Scotsman, No. 85 at p. 2b-3)
    AHRI, Manitowoc, and NAFEM commented that a three year compliance 
period is not adequate for this rulemaking and that DOE should extend 
the compliance period to allow time for manufacturers to obtain new 
components. (AHRI, Public Meeting Transcript, No. 70 at p. 18; NAFEM, 
No. 82 at pg. 2-3; Manitowoc, No. 92 at p. 2 -3) NAFEM and AHRI 
commented that DOE should extend the compliance period by two years. 
(AHRI, No. 93 at p. 2; NAFEM, No. 82 at pg. 2-3) AHRI and Manitowoc 
noted that there is a potential for Environmental Protection Agency 
(EPA) Significant New Alternatives Policy (SNAP) regulations to force 
further product redesign and extending the compliance period would 
provide relief should refrigerant regulatory issues not be finalized in 
time.\21\ (AHRI, No. 93 at p. 2; Manitowoc, No. 126 at p. 3) Emerson 
urged DOE to wait until after EPA finalizes its decision on 
refrigerants before starting the 3-year period given to manufacturers 
to meet the new standards so manufacturers can re-design for both 
energy efficiency and low global warming potential (GWP) refrigerants 
in one design cycle. (Emerson, No. 122, p. 1)
---------------------------------------------------------------------------

    \21\ Details regarding EPA SNAP regulations are discussed in 
section IV.A.4.
---------------------------------------------------------------------------

    NAFEM stated that manufacturers will only be able to achieve energy 
efficiency gains up to the level of NOPR TSL 1 within the five-year 
compliance timeline and that the current proposal will result in the 
unavailability of ice makers with the characteristics, sizes, 
capacities, and volumes that are generally available in the U.S. 
(NAFEM, No. 82 at p. 2) NAFEM's comment mentions a five-year compliance 
timeline, although DOE proposed a three-year timeline in the NOPR. 79 
FR at 14949 (March 17, 2014).
    Another concern amongst manufacturers was the belief that the 
proposed standard levels were based on technology that was currently 
not available. At the April 2014 NOPR public meeting, Ice-O-Matic 
commented that they did not believe that the technology exists to 
achieve the proposed standards in the allotted time frame. (Ice-O-
Matic, Public Meeting Transcript, No. 70 at p. 33)
    Joint Commenters noted that, in balancing the stringency of the 
standards with the compliance dates and manufacturer impacts, they 
believe that the stringency of the standard is more important for 
national energy savings than the compliance dates. (Joint Commenters, 
No. 87 at p. 4)
    In response to the assertion that DOE's standard levels were not 
based upon currently available technologies, DOE maintains that all 
technology options and equipment configurations included in its NOPR 
reflect technologies currently in use in automatic commercial ice 
makers. For example, DOE considered use only of compressors that are 
currently commercially available and which manufacturers have indicated 
are acceptable for use in ice makers in confidential discussions with 
DOE's contractor. Moreover, the proposed standard levels are exceeded 
by the ratings of some products that are currently commercially 
available. However, the standard levels established in this final rule 
are significantly less stringent than the standard levels proposed in 
the NOPR, and a greater percentage of currently-available products 
already meet these efficiency levels. DOE expects that this reduction 
in stringency and the reduced number of products requiring redesign 
means that the time required for manufacturers to achieve compliance 
would be reduced.
    In response to the NODA, Scotsman, Manitowoc, NAFEM, and Ice-O-
Matic all requested that the effective date for the new efficiency 
standard for ACIMs be extended to 5 years after the publication of the 
final rule. (Scotsman, No. 125 at p. 3; Manitowoc, No. 126 at p. 3; 
NAFEM, No. 123 at p. 2; Ice-O-Matic, No. 121 at p. 1) NAFEM stated that 
even with the more realistic assumptions presented in the NODA, 
manufactures still require an extended timeline to obtain new 
components needed to meet higher efficiency levels.
    In response to the request that DOE extend the compliance date 
period for automatic commercial ice makers beyond the 3 years specified 
by the NOPR, DOE notes that EPCA requires that the amended standards 
established in this rulemaking must apply to equipment that is 
manufactured on or after 3 years after the final rule is published in 
the Federal Register unless DOE determines, by rule, that a 3-year 
period is inadequate, in which case DOE may extend the compliance date 
for that standard by an additional 2 years. (42 U.S.C. 6313(d)(3)(C)) 
DOE believes that the modifications to the analysis, relative to the 
NOPR, it announced in the NODA and made to the final rule will reduce 
the burden on manufacturers to meet requirements established by this 
rule, because the standard levels are less stringent and fewer ice 
maker models will require redesign to meet the new standard. Therefore, 
DOE has determined that the

[[Page 4662]]

3-year period is adequate and is not extending the compliance date for 
ACIMs.
3. Negotiated Rulemaking
    Stakeholders AHRI, Hoshizaki, Manitowoc, and the North American 
Association of Food Equipment Manufactures (NAFEM) both suggested that 
DOE use a negotiated rulemaking to develop ACIM standards. (AHRI, 
Public Meeting Transcript, No. 70 at p. 15-16; AHRI, Public Meeting 
Transcript, No. 128 at p. 1; Hoshizaki, Public Meeting Transcript, No. 
70 at p. 38-39; Hoshizaki, Public Meeting Transcript, No. 124 at p. 3; 
Manitowoc, Public Meeting Transcript, No. 70 at p. 344-345; NAFEM, No. 
82 at p. 2; NAFEM, No. 123 at p. 1) NAFEM stated that a negotiated 
rulemaking would ensure the level of enhanced dialogue needed for DOE 
to effectively assess the rule's impact on end-users. (NAFEM, No. 82 at 
p. 2) AHRI stated that there are significant issues in the analysis, 
that the current direction of this rulemaking will place significant 
burden on the industry, and that the completion of this rulemaking 
under the current process will be difficult, expensive, and not timely. 
(AHRI, Public Meeting Transcript, No. 70 at p. 15-16)
    In response to the manufacturers' suggestion to use a negotiated 
rulemaking to develop ACIM standards, DOE notes that this issue was 
raised before the Appliance Standards and Rulemaking Federal Advisory 
Committee (ASRAC) on June 6, 2014 and the ASRAC membership declined to 
establish a working group to negotiate a final rule for ACIM energy 
conservation standards. Several ASRAC members voiced concern of using 
ASRAC at such a late stage in the rulemaking when it would be more 
appropriate to raise these concerns in the normal public comment 
process. (See public transcript at: http://www.regulations.gov/#!documentDetail;D=EERE-013-BT-NOC-0005-0025)
4. Refrigerant Regulation
    Manitowoc noted that the EPA has proposed delisting R-404A, the 
refrigerant used in nearly all currently available ice makers, for 
commercial refrigeration applications. Manitowoc stated that while 
commercial ice makers are not within the current scope for the SNAP 
NOPR, it seems likely that ice makers could be affected by a subsequent 
rulemaking. (Manitowoc, No. 126 at p. 3) Several interested parties, 
including AHRI, NAFEM, Hoshizaki, Manitowoc, and Howe requested that 
DOE consider the hardships associated with refrigerant choice 
uncertainty caused by potential future EPA SNAP regulations in the 
analysis (AHRI, Public Meeting Transcript, No. 70 at p. 16-18; NAFEM, 
No. 82 at p. 7; Hoshizaki, No. 86 at p. 6-7; Howe, No. 88 at p. 2-3; 
Manitowoc, Public Meeting Transcript, No. 70 at p. 286-287; Manitowoc, 
No. 126 at p. 3) Manitowoc suggested that DOE do a sensitivity analysis 
that examines what would happen to life-cycle costs, etc. if 
manufacturers had to re-engineer twice. (Manitowoc, Public Meeting 
Transcript, No. 70 at p. 286-287)
    AHRI commented that the potential for SNAP rulemakings to require a 
refrigerant change will necessitate major redesigns just to maintain 
current efficiency levels. (AHRI, Public Meeting Transcript, No. 70 at 
p. 16-18) Manitowoc and Hoshizaki also expressed concern regarding the 
redesign work that would be needed if the EPA were to ban R-404A. 
(Manitowoc, Public Meeting Transcript, No. 70 at p. 286-287; Hoshizaki, 
No. 86 at p. 6-7) AHRI added that the burden of the potential EPA SNAP 
rulemaking must be taken into account in the engineering and life-cycle 
cost analyses. AHRI requested that DOE put a hold on the ACIM 
rulemaking until after the next SNAP rollout is completed. (AHRI, 
Public Meeting Transcript, No. 70 at p. 16-18)
    AHRI also commented that the DOE should make an effort to look at 
refrigerants because its cost-benefit analysis is based solely on a 
refrigerant that may not exist three years from now. (AHRI, Public 
Meeting Transcript, No. 70 at p. 284-285) AHRI noted that, because low-
GWP refrigerants also have lower heat transfer capability than R-404A, 
coil sizes may need to further increase in order to maintain the 
performance with other refrigerants, which could be infeasible if the 
proposed standards are already calling for an increased coil size for 
units using R-404A. (AHRI, Public Meeting Transcript, No. 70 at p. 293-
294)
    Scotsman and Hoshizaki suggested that DOE and EPA collaborate so 
that both the energy conservation rulemaking and the SNAP rulemaking 
don't promulgate standards that are unduly burdensome. (Scotsman, No. 
125 at p. 2; Hoshizaki, No. 86 at p. 6-7)
    Manitowoc stated that even if the EPA takes no action on ice makers 
in the next 3 years, the component supplier industry (compressors, 
expansion valves, heat exchangers, etc.) will focus its efforts on 
supporting the transition to hydrocarbons, HFO blends, and other 
acceptable refrigerants for the refrigeration industry as the volume of 
display case, reach-in, walk-in, and vending is significantly larger 
than that for commercial ice machines. (Manitowoc, No. 126 at p. 3)
    ASAP commented that the way that DOE is dealing with the 
refrigerants issue is consistent with how it has dealt with it in all 
other rulemakings. (ASAP, Public Meeting Transcript, No. 70 at p. 52-
53) Joint Commenters commented that DOE's approach of conducting their 
analysis based on the most commonly-used refrigerants today is 
appropriate and that it does not appear that a phase-out of R-404A 
would negatively impact ice maker efficiency, given the fact that 
propane, DR-33, and N-40 all have lower GWP and similar efficiency 
compared to R-404A. (Joint Commenters, No. 87 at p. 4) NEEA expressed 
their support for DOE's current refrigerant-neutral position. (NEEA, 
No. 91 at p. 2)
    In response to these comments, DOE notes that the EPA SNAP NOPR 
mentioned by Manitowoc (see 79 FR 46149 (Aug. 6, 2014)) did not propose 
to delist the use of R-404A for ACIMs. EPA proposed to delist R-404A 
for certain retail food refrigeration applications including condensing 
units. However, ACIMs do not qualify as retail food refrigeration 
equipment and therefore will not be subject to SNAP regulations that 
pertain to retail refrigeration applications. Further, alternate 
refrigerants have not been proposed by the SNAP program for use in 
ACIMs.\22\ DOE recognizes that the engineering analysis is based on the 
use of R-404A, the most commonly used refrigerant in ACIMs, and that a 
restriction of R-404A in ACIMs would have impacts on the design options 
selected in the engineering analysis. However, DOE cannot speculate on 
the outcome of a rulemaking in progress and can only consider in its 
rulemakings rules that are currently in effect. Therefore, DOE has not 
included possible outcomes of a potential EPA SNAP rulemaking in the 
engineering or LCC analysis. This position is consistent with past DOE 
rulings, such as in the 2011 direct final rule for room air 
conditioners. 76 FR 22454 (April 21, 2011). DOE is aware of stakeholder 
concerns that EPA may broaden the uses for which R-404A is phased out 
at some point in the future. DOE is confident

[[Page 4663]]

that there will be an adequate supply of R-404A for compliance with the 
standards being finalized in today's rule, however, consistent with EO 
13563, Improving Regulation and Regulatory Review, DOE will prioritize 
its review of the potential effects of any future phase-out of the 
refrigerant R-404A (should there be one) on the efficiency standards 
set by this rulemaking.
---------------------------------------------------------------------------

    \22\ EPA on July 9, 2014 proposed new alternative refrigerants 
for several applications, but not ACIMs. 79 FR 38811. EPA also, on 
August 6, 2014, proposed delisting of refrigerants for several 
applications, but not ACIMs. 79 FR 46126 (Aug. 6, 2014). The notice 
did indicate that EPA is considering whether to delist use of R-404A 
for ACIMs, but did not propose such action. 79 FR at 46149.
---------------------------------------------------------------------------

    DOE does not have reason to believe that EPA's SNAP proposal to 
delist R-404A for commercial refrigeration applications will have a 
deleterious impact on the availability of components for ACIMs. 
Although the component supplier industry may focus efforts on 
supporting the transition to alternative refrigerants for the 
commercial refrigeration industry as suggested by Manitowoc, the design 
options included in this final rule are based on existing component 
technology and do not assume an advancement in such components. 
Therefore, DOE believes that those components currently on the market 
will remain available for use by ACIM manufactures. DOE wishes to 
clarify that it will continue to consider ACIM models meeting the 
definition of automatic commercial ice makers to be part of their 
applicable covered equipment class, regardless of the refrigerant that 
the equipment uses. If a manufacturer believes that its design is 
subjected to undue hardship by regulations, the manufacturer may 
petition DOE's Office of Hearing and Appeals (OHA) for exception relief 
or exemption from the standard pursuant to OHA's authority under 
section 504 of the DOE Organization Act (42 U.S.C. 7194), as 
implemented at subpart B of 10 CFR part 1003. OHA has the authority to 
grant such relief on a case-by-case basis if it determines that a 
manufacturer has demonstrated that meeting the standard would cause 
hardship, inequity, or unfair distribution of burdens.
    DOE investigated ice makers which it believes use refrigerants 
other than R-404A, specifically refrigerants HFC-134a and R-410A. While 
these refrigerants are also HFCs, their GWP is significantly lower than 
that of R-404A,\23\ and for this reason may be less likely to be 
delisted for use in ice makers under future SNAP rule revisions. Based 
on the available information, DOE concludes that compliance challenges 
for these alternative refrigerants are not greater than for R-404A. 
Table IV.1 below presents performance data of alternative-refrigerant 
ice makers and compares their energy use to the energy use associated 
with TSL3 for their equipment class and capacity. Thirteen of these 31 
ice makers meet the TSL3 level.
---------------------------------------------------------------------------

    \23\ See http://www.epa.gov/ozone/snap/subsgwps.html.

                                                  Table IV.1--Ice Makers Using Alternative Refrigerants
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                              Harvest                       Energy use      TSL3 Energy
                  Refrigerant                                Equipment class               capacity rate    Energy use     percent below   use (kWh/100
                                                                                          (lb ice/24 hr)   (kWh/100 lb)      baseline           lb)
--------------------------------------------------------------------------------------------------------------------------------------------------------
HFC-134a.......................................  SCU-A-Small-B..........................             121             8.4            31.8             9.4
R-410A.........................................  IMH-W-Small-B *........................             302             6.1             0.6             5.2
R-410A.........................................  IMH-W-Small-B..........................             305             5.2            15.1             5.2
R-410A.........................................  IMH-W-Small-B..........................             310             5.2            14.7             5.2
R-410A.........................................  IMH-W-Small-B..........................             428             4.7            13.7             5.0
R-410A.........................................  IMH-W-Small-B..........................             430             4.7            13.5             5.0
R-410A.........................................  IMH-W-Small-B..........................             494               5             1.6             4.9
R-410A.........................................  IMH-W-Med-B............................             510               5             0.4             4.8
R-410A.........................................  IMH-W-Med-B *..........................             730            4.75             0.6             4.4
R-410A.........................................  IMH-W-Med-B *..........................           1,200             4.1             3.8             4.1
R-410A.........................................  IMH-A-Small-B..........................             222             7.5            10.2             7.3
R-410A.........................................  IMH-A-Small-B..........................             300             6.2            19.3             6.3
R-410A.........................................  IMH-A-Small-B..........................             305             6.8            11.0             6.3
R-410A.........................................  IMH-A-Small-B..........................             388               6            13.3             6.1
R-410A.........................................  IMH-A-Large-B..........................             485               6             5.6             5.8
R-410A.........................................  IMH-A-Large-B..........................             714             6.1             0.1             5.3
R-410A.........................................  IMH-A-Large-B..........................             230             7.5             9.4             6.5
R-410A.........................................  IMH-A-Large-B..........................             320             6.2            17.4             6.3
R-410A.........................................  IMH-A-Large-B..........................             310             6.8            10.5             6.3
R-410A.........................................  IMH-A-Large-B..........................             405             5.8            14.4             6.0
R-410A.........................................  IMH-A-Large-B..........................             538               6             4.7             5.7
R-410A.........................................  IMH-A-Large-B..........................             714             6.1             0.1             5.3
R-410A.........................................  IMH-A-Large-B *........................           1,100             5.3             6.7             4.9
R-410A.........................................  RCU-NRC-Small-B........................             724             5.4            11.5             5.5
R-410A.........................................  RCU-NRC-Small-B........................             720             5.4             8.8             5.5
R-410A.........................................  RCU-NRC-Small-B *......................           1,200               5             2.0             4.6
--------------------------------------------------------------------------------------------------------------------------------------------------------
* Two ice makers with these ratings, one each for full-cube and half-cube ice.

5. Data Availability
    AHRI, PGE/SDG&E, and NAFEM requested that DOE make data available 
for stakeholder review. (AHRI, Public Meeting Transcript, No. 70 at p. 
349; PG&E and SDG&E, No. 89 at p. 3; NAFEM, No. 82 at p. 2) 
Specifically, AHRI requested that DOE's test results be made available 
to manufacturers for review. (AHRI, Public Meeting Transcript, No. 70 
at p. 349) NAFEM suggested that DOE identify the model and serial 
number of components used in the engineering analysis in order to 
enhance transparency. (NAFEM, No. 82 at p. 2)
    AHRI and Danfoss both suggested that DOE facilitate more informal 
dialog to discuss data and assumptions for the department to receive 
feedback. (AHRI, Public Meeting Transcript, No. 70 at p. 342-343; 
Danfoss, No. 72 at p. 1-2)

[[Page 4664]]

Danfoss recommended that DOE publish the list of all persons, companies 
and organizations they have contacted in regards to this rulemaking. 
(Danfoss, No. 72 at p. 1-2)
    In response to stakeholders, DOE held a public meeting on June 19 
to provide stakeholders with more information about the energy modeling 
used in developing the NOPR analysis. 79 FR 33877 (June 13, 2014). In 
addition, DOE published a NODA presenting analyses revised based on 
stakeholder comments and additional research conducted after the NOPR. 
79 FR 54215 (Sept. 11, 2014). DOE's contractor also engaged in 
additional discussions with manufacturers under non-disclosure 
agreements after publication of the NOPR in order to collect additional 
information relevant to the analyses. DOE generally does not publish 
test data to avoid revealing information about product performance that 
may be considered trade secrets. Also for this reason, DOE does not 
intend to publish the model and serial number of equipment or 
components obtained, tested, and reverse-engineered during the 
analysis. DOE also does not reveal the identity of companies and 
organizations from which its contractor has collected information under 
non-disclosure agreement.
    In their written response to the NODA, AHRI expressed their belief 
that DOE's current process in this rulemaking is not compliant with the 
objective of using transparent and robust analytical methods producing 
results that can be explained and reproduced, as required by DOE's 
process rule and guidelines. AHRI expressed their belief that it has 
been difficult to analyze and provide feedback on this rulemaking as 
important portions such as the energy model have not been disclosed to 
the public. (AHRI, No. 128 at p. 6-8)
    AHRI and NAFEM requested that DOE publically release the FREEZE 
model for stakeholder review. NAFEM and AHRI stated that DOE was unable 
to show that the FREEZE model functioned and was unable to produce 
accurate results at the June 2014 public meeting. (AHRI, No. 128 at p. 
2-3; NAFEM, No. 123 at p. 1-2) AHRI stated that given the results of 
the limited runs model at the June 19th meeting, they believe that 
there are serious concerns about the quality and reproducibility of the 
information that is not in accordance with the applicable guidelines 
for ensuring and maximizing the quality, objectivity, utility and 
integrity of information disseminated to the public by the Department 
of Energy. AHRI added that without public release of the model, DOE 
cannot demonstrate sufficient transparency about the data and methods 
such that an independent reanalysis can be undertaken by a qualified 
member of the public. AHRI noted that if DOE had compelling interests 
that prohibit public access to the model, DOE must identify those 
interests and describe and document the rigorous checks it has 
undertaken to ensure reproducibility. (AHRI, No. 128 at p. 6-8)
    DOE notes that stakeholders have placed great emphasis on the 
FREEZE model in their responses, but this model is only part of the 
analysis. Moreover, DOE has published output of the engineering 
analysis on which stakeholders have had the opportunity to comment, for 
both the NOPR and NODA phases. As part of the final rule documentation, 
DOE presents the revised engineering analysis output.
    Over the course of the rulemaking, DOE has attained additional 
information regarding the efficiency improvements associated with 
different design options, through public comments as well as through 
confidential information exchange between DOE's contractor and 
manufacturers. As a result the efforts made by all parties in preparing 
and providing this additional information, the projections of 
efficiency improvements associated with the design options considered 
in the analysis are based more on test data than theoretical analysis. 
For example, in the NODA and final rule analysis, the energy use 
reduction in a batch ice maker as a result of compressor EER 
improvement is based on test data provided both in written comments and 
through confidential information exchange.
    In the NOPR and the NODA phases, DOE has published engineering 
spreadsheets that show projected energy savings associated with 
specific design options for the analyses of energy use for the ice 
maker models representing most of the ice maker equipment classes. 
These results document the analysis and have allowed stakeholders to 
review details of the analysis as a check on accuracy. DOE's 
calibration of the energy use analysis results at the highest 
commercially-available efficiency levels, described in section 
IV.D.4.b, provides a check of the analysis, specifically ensuring that 
the group of design options required to attain these highest available 
efficiency levels (as predicted by the analysis) is consistent with 
actual equipment. The section presents examples of maximum available 
commercial units against which the energy use calculations are 
calibrated for the highest analyzed efficiency levels not using 
permanent magnet motors and drain water heat exchangers. DOE conducted 
calibration at this efficiency level because these design options are 
not generally used in commercially available units, thus preventing 
calibration with commercialized units at higher efficiency levels. 
These calibration comparisons, which are discussed in section IV.D.4.b 
and in Chapter 5 of the TSD, show (a) that the efficiency levels 
attainable without use of permanent magnet motors and drain water heat 
exchangers have not been overestimated by the analysis, and (b) the 
design options that are projected to be required to attain these 
maximum available efficiency levels are consistent with or conservative 
(more costly) as compared with the design options used in maximum-
available ice makers that are available for purchase.
    DOE is not at liberty to release the FREEZE energy model to the 
public because it does not own the modeling tool.
    AHRI stated that DOE did not publically provide the information 
necessary for affected parties to have adequate notice and ability to 
comment on the results of the public meeting. AHRI stated that DOE 
failed to publically state a timeframe for collecting the data it has 
requested. AHRI added that the public statement issued after the public 
meeting did not indicate to whom the data should be sent. AHRI stated 
their belief that without the clarity of a defined comment period, or 
the knowledge of the next steps in the process DOE is not following its 
own process rule and the notice and comment requirements for federal 
agency rulemaking. (AHRI, No. 128 at p. 6-8)
    In response to AHRI's comment, DOE expressed willingness during the 
NOPR public meeting, subject to potential legal restrictions, to allow 
additional information exchange by stakeholders with DOE's contractor 
under non-disclosure agreement. DOE also expressed willingness to 
possibly publish a NODA which would allow stakeholders additional 
opportunity to comment. (DOE, NOPR Public Meeting Transcript, No. 70 at 
pp. 341-344) In general, any information exchange regarding a 
rulemaking is strictly limited after publication of a NOPR, in order to 
limit the potential for undue influence on the process from any 
particular interested party. DOE allowed additional information 
exchange with stakeholders and published a NODA to allow additional 
opportunity for input. 79 FR 54215 (Sept. 11, 2014). Thus, contrary to 
AHRI's comment, with the

[[Page 4665]]

additional public meeting and with the issuance of the NODA, 
stakeholders have had several opportunities to provide input beyond the 
opportunities normally provided for an energy conservation standard 
rulemaking.
6. Supplemental Notice of Proposed Rulemaking
    NAFEM stated that DOE should not issue a final rule because the 
revisions in the NODA did not address each issue raised in response to 
the NOPR analysis. (NAFEM, No. 123 at p. 1) NAFEM and AHRI both 
requested that the department issue a supplemental notice of proposed 
rulemaking (SNOPR) to allow manufacturers and end users enough time to 
address the substantial changes in the analysis made between the NOPR 
and NODA phases. (NAFEM, No. 123 at p. 1; AHRI, No. 128 at p. 2) NAFEM 
stated that there are many unknowns regarding the changes made in the 
NODA analysis and noted that DOE did not identify a technologically 
feasible and economically justified standard level. NAFEM also 
requested that DOE release the model used to determine TSL standards. 
(NAFEM, No. 123 at p. 1)
    In response to AHRI and NAFEM, DOE notes that the modifications 
made to the analyses in the NODA were based on stakeholder 
participation, and each issue raised in response to the NOPR and NODA 
have been addressed in this final rule. The objective of the NODA was 
to enable stakeholders to understand the changes made in the basic 
analyses as a result of input received during the NOPR phase, and DOE 
believes that was accomplished. Therefore, DOE does not believe that an 
SNOPR is necessary for this rulemaking. In response to NAFEM's request 
for DOE to release the model used to determine the TSL standard, DOE 
assumes that this refers to the FREEZE model, which is discussed in 
section IV.A.5. DOE is not at liberty to release the FREEZE energy 
model to the public because it does not own the modeling tool. 
Regarding NAFEM's comment concerning identification of a 
technologically feasible and economically justified standard level, DOE 
notes that the NODA did not propose a standard level. Rather the NODA's 
purpose was to provide stakeholders the opportunity to comment on 
revisions in DOE's analysis.
7. Rulemaking Structure Comments
    A Policy Analyst at the George Washington University Regulatory 
Studies Center commented on basic underpinnings of the DOE energy 
conservation standards rulemaking process. Policy Analyst commented 
that DOE does not explain why sophisticated, profit-motivated 
purchasers of ACIMs would suffer from informational deficits or 
cognitive biases that would cause them to purchase products with high 
lifetime costs without demanding higher-price, higher-efficiency 
products. (Policy Analyst, No. 75 at p. 5)
    Policy Analyst indicated that two of the three problems identified 
by DOE, lack of access to information and information asymmetry, are 
not addressed by the rule, indicating that DOE's rule is flawed. 
(Policy Analyst, No. 75 at p. 6) Policy Analyst added that only one of 
the problems identified by DOE is addressed by any of the metrics 
stated in the proposed rule: Internalizing the externality of 
greenhouse gas emissions. (Policy Analyst, No. 75 at p. 7)
    Policy Analyst suggested that the proposed rule should include 
DOE's plans for how it will gather information to assess the success of 
the rule and whether its assumptions were accurate. (Policy Analyst, 
No. 75 at p. 8) Policy Analyst added that DOE should include a 
timeframe for retrospective review in its final rule. (Policy Analyst, 
No. 75 at p. 8)
    Policy Analyst stated that DOE should pay attention to the linkages 
between the rule and the measured outcomes in order to increase its 
awareness of mediating factors that may have accomplished or undermined 
the stated metrics absent the rule. (Policy Analyst, No. 75 at p. 8)
    In response, DOE believes there are two main reasons that 
purchasers of ACIM equipment would lack complete information, causing 
them to, in Policy Analyst's words, ``purchase products with high 
lifetime costs without demanding higher-price, higher-efficiency 
products.'' The first reason is the time involved in collection and 
processing of information and the second is that the available 
information is incomplete. ACIM purchasers have access only to 
information that is readily available, and would not have ready access 
to information about additional efficiency options that could be made 
available to the market. The information that is available is dispersed 
in many sources, and the cost of querying all information sources takes 
the form of time taken away from the primary business of the purchaser, 
whether running a hotel or provision of medical care. By virtue of 
simply undertaking the energy conservation standard rulemaking, DOE 
provides significant information to all who are interested via the 
analyses undertaken by the rulemaking.
    As the energy conservation standard rulemaking has proceeded from 
the initial framework phase through to the final rule phase, DOE has 
solicited information, purchased, examined and tested actual ACIM 
products, and performed numerous analyses to ensure assumptions are as 
accurate as possible. Once a rule is finalized, DOE continues 
collecting information as well as interacting with the industry, and 
such activities will enable DOE to measure whether the rule is 
achieving its intended results--namely increasing the efficiency of 
automatic commercial ice makers.
    DOE will undertake subsequent analyses of ACIM equipment in order 
to meet legislative requirements for reviewing the standard by a date 
no later than 5 years after the effective date of new and amended 
standards established by this rulemaking. DOE follows a standard 
process in energy conservation standards rulemakings, and believes as 
such, that establishing plans within this final rule for gathering 
information for the next proceeding is unnecessary.

B. Market and Technology Assessment

    When beginning an energy conservation standards rulemaking, DOE 
develops information that provides an overall picture of the market for 
the equipment concerned, including the purpose of the equipment, the 
industry structure, and market characteristics. This activity includes 
both quantitative and qualitative assessments based primarily on 
publicly available information (e.g., manufacturer specification 
sheets, industry publications) and data submitted by manufacturers, 
trade associations, and other stakeholders. The subjects addressed in 
the market and technology assessment for this rulemaking include: (1) 
Quantities and types of equipment sold and offered for sale; (2) retail 
market trends; (3) equipment covered by the rulemaking; (4) equipment 
classes; (5) manufacturers; (6) regulatory requirements and non-
regulatory programs (such as rebate programs and tax credits); and (7) 
technologies that could improve the energy efficiency of the equipment 
under examination. DOE researched manufacturers of automatic commercial 
ice makers and made a particular effort to identify and characterize 
small business manufacturers. See chapter 3 of the final rule TSD for 
further discussion of the market and technology assessment.

[[Page 4666]]

1. Equipment Classes
    In evaluating and establishing energy conservation standards, DOE 
generally divides covered equipment into classes by the type of energy 
used, or by capacity or other performance-related feature that 
justifies a different standard for equipment having such a feature. (42 
U.S.C. 6295(q) and 6316(a)) In deciding whether a feature justifies a 
different standard, DOE considers factors such as the utility of the 
feature to users. DOE normally establishes different energy 
conservation standards for different equipment classes based on these 
criteria.
    Automatic commercial ice makers are divided into equipment classes 
based on physical characteristics that affect commercial application, 
equipment utility, and equipment efficiency. These equipment classes 
are based on the following criteria:

 Ice-making process
    [cir] ``Batch'' icemakers that operate on a cyclical basis, 
alternating between periods of ice production and ice harvesting
    [cir] ``Continuous'' icemakers that can produce and harvest ice 
simultaneously
 Equipment configuration
    [cir] Ice-making head (a single-package ice-making assembly that 
does not include an ice storage bin)
    [cir] Remote condensing (an ice maker consisting of an ice-making 
head in which the ice is produced--but also without an ice storage 
bin--and a separate condenser assembly that can be remotely installed,)
     With remote compressor (compressor packaged with the 
condenser)
     Without remote compressor (compressor packaged with the 
evaporator in the ice-making head)
    [cir] Self-contained (with storage bin included)
 Condenser cooling
    [cir] Air-cooled
    [cir] Water-cooled
 Capacity range

    Table IV.2 shows the 25 automatic commercial ice maker equipment 
classes that DOE used for its analysis in this rulemaking. These 
equipment classes were derived from existing DOE standards and 
commercially available products. The final rule adjusts these capacity 
ranges, based on this analysis, as a result of setting appropriate 
energy use standards across the overall capacity range (50 to 4,000 lb 
ice/24 hours) for a given type of equipment, such as all batch air-
cooled ice-making head units.

            Table IV.2--Final Rule Automatic Commercial Ice Maker Equipment Classes Used for Analysis
----------------------------------------------------------------------------------------------------------------
                                                             Type of  condenser  Harvest capacity rate lb ice/24
        Type of ice maker              Equipment type             cooling                     hours
----------------------------------------------------------------------------------------------------------------
Batch...........................  Ice-Making Head.........  Water..............  >=50 and =500 and =1,436 and =50 and =450 and =50 and =1,000 and =50 and =934 and =50 and =200 and =50 and =175 and =50 and =900 and =50 and =700 and =50 and =850 and =50 and =850 and =50 and =900 and =50 and =700 and 24 hours. This includes tube ice 
machines and other batch type ice machines (if any) that produce ice 
that does not fit the definition of cube type ice. To help clarify this 
issue, DOE now refers to all batch automatic commercial ice makers as 
``batch type ice makers,'' regardless of the shape of the ice pieces 
that they produce. 77 FR 1591 (Jan. 11, 2012).
    During the April 2014 NOPR public meeting and in subsequent written 
comments, a number of stakeholders addressed issues related to proposed 
equipment classes and the inclusion of certain types of equipment in 
the analysis. These topics are discussed in this section.
a. Cabinet Size
    In the March 2014 NOPR, DOE indicated that it was not proposing to 
create separate equipment classes for space-constrained units. DOE 
requested comment on this issue in the preliminary analysis phase. Few 
stakeholders commented on whether DOE should consider establishing 
equipment classes based on cabinet size. Earthjustice supported such an 
approach, while Manitowoc suggested that such an approach would be 
complicated. (Earthjustice, Preliminary Analysis Public Meeting 
Transcript, No. 42 at pp. 90-91; Manitowoc, (Manitowoc, Preliminary 
Analysis Public Meeting Transcript, No. 42 at p. 91)) DOE also reviewed 
size/efficiency trends of commercially available ice makers and 
concluded that the data do not show a definitive trend suggesting 
specific size limits for space-constrained classes. 79 FR 14846, at 
14862 (March 17, 2014).
    In response to the March 2014 NOPR, AHRI and NAFEM commented that 
DOE did not conduct analysis for the full range of product offerings in 
the market. (AHRI, No. 93 at p. 12-13; NAFEM, No. 82 at p. 4) AHRI, 
NAFEM, and Manitowoc commented that DOE's analysis did not take into 
account the difficulty associated with increasing cabinet volume for 
22-inch models (i.e. ice makers that are 22 inches wide). (AHRI, No. 93 
at p. 12-13; Manitowoc, No. 92 at p. 2; NAFEM, No. 82 at p. 4) 
Manitowoc added that the engineering analysis focused on 30-inch 
cabinets and that the design options may not all fit within the 22-inch 
cabinet models. (Manitowoc, No. 92 at p. 2 and p. 26-27) AHRI stated 
that they had data showing that 22-inch units cannot accommodate 
evaporator or condenser growth without chassis growth which is not 
possible for these size-restricted units. AHRI noted that DOE included 
chassis size increases for some equipment classes without taking into 
account in the engineering analysis the special case of 22-inch ice 
makers. (AHRI, No. 93 at p. 12-13) NAFEM specifically requested that 
DOE differentiate between 22-inch and 30-inch IMH-A-Small-B machines, 
since 22-inch models cannot achieve increases in cabinet volume and 30-
inch models cannot be substituted for 22-inch models. (NAFEM, No. 82 at 
p. 4) Hoshizaki also urged DOE to take 22-inch units into special 
consideration in the analysis. (Hoshizaki, No. 86 at p. 8)
    Manitowoc commented that 22-inch air-cooled ice-making heads are 
growing in importance due to the shrinking size of restaurant kitchens 
and that such machines cannot grow in height because they are already 
very tall. Manitowoc asserted that this product category may disappear 
if efficiency standards require significant chassis size growth. 
(Manitowoc, Public Meeting Transcript, No. 70 at p. 162-164)
    However, the Northwest Energy Efficiency Alliance (NEEA) stated 
that they believe that DOE appropriately considered the issues 
concerning increased chassis size, citing DOE's consideration of 
chassis size increase only for three of the twenty-two classes 
analyzed, and the fact that DOE considered only increases in height, 
not increases in footprint. (NEEA, No. 91 at p. 1-2)
    DOE has maintained its position from the NOPR and has not created a 
new equipment class for 22-inch ACIMs. However, in response to 
commenters DOE revised the NOPR analysis to consider the size 
restrictions and applications of 22-inch wide ice makers in its revised 
analysis. Specifically, DOE has developed cost-efficiency curves for 
22-inch width units in the IMH-A-Small-B, IMH-A-Large-B, and IMH-W-
Small-B equipment classes. These curves were used in the LCC and NIA 
analyses in the evaluation of efficiency levels for classes for which 
22-inch ACIMs are an important category. The LCC and NIA analyses were 
also revised to more carefully consider the impact of size restrictions 
in applications for 30-inch units--this is discussed in greater detail 
in section IV.G.2. Ultimately these revisions in the analyses led to 
selection of less stringent efficiency levels for some of the affected 
classes.
b. Large-Capacity Batch Ice Makers
    In the November 2010 Framework document for this rulemaking, DOE 
requested comments on whether coverage should be expanded from the 
current covered capacity range of 50 to 2,500 lb ice/24 hours to 
include ice makers producing up to 10,000 lb ice/24 hours. All 
commenters agreed with expanding the harvest capacity coverage, and all 
but one of the commenters supported or accepted an upper harvest 
capacity cap of 4,000 lb ice/24 hours, which would be consistent with 
the current test procedure, AHRI Standard 810-2007. Most commenters 
categorized ice makers with harvest capacities above 4,000 lb ice/24 
hours as industrial rather than commercial. Since the publication of 
the framework analysis, DOE revised the test procedure, with the final 
rule published in January 2012, to include all batch and continuous 
type ice makers with capacities between 50 and 4,000 lb ice/24 hours. 
77 FR 1591, 1613-14. In the 2012 test procedure final rule, DOE noted 
that 4,000 lb ice/24 hours represented a reasonable limit for 
commercial ice makers, as larger-sized ice makers were generally used 
for industrial applications and testing machines up to 4,000 lb was 
consistent with AHRI 810-2007. 77 FR 1591 (Jan. 11, 2012). To be 
consistent with the majority of the framework comments, during the 
preliminary analysis DOE discussed setting the upper harvest capacity 
limit to 4,000 lb ice/24 hours, even though there are few ice makers 
currently produced with capacities ranging from 2,500 to 4,000 lb ice/
24 hours. 77 FR 3404 (Jan. 24, 2012) DOE proposed in the March 2014 
NOPR to set efficiency standards that include all ice makers in this 
extended capacity range and has maintained this position in this final 
rule.
    PG&E and SDG&E commented that they support the inclusion of 
previously unregulated equipment classes into the scope of this 
rulemaking, including equipment with a capacity range up to 4,000 lb/24 
hour. (PG&E and SDG&E,

[[Page 4668]]

No. 89 at p. 1) However, Hoshizaki, NAFEM, and AHRI commented that DOE 
should refrain from regulating products with capacities above 2,500 lb 
ice/24 hours, if there are not enough models in this category for DOE 
to directly evaluate. (Hoshizaki, No. 86 at p. 9; Hoshizaki, No. 124 at 
p. 2; AHRI, No. 93 at p. 16; NAFEM, No. 123 at p. 2) Hoshizaki 
commented that large units perform differently than small units in the 
ways that their compressors and condensers interact. Hoshizaki 
requested that DOE not add higher levels to the standard extended 
beyond 2,000 lb ice/24 hours, but have a flat level no more stringent 
than the standard at 2,000 lb ice/24 hours for higher capacity 
equipment. (Hoshizaki, No. 124 at p. 2)
    DOE acknowledges that there are currently few automatic commercial 
ice makers with harvest capacities above 2,500 lb ice/24 hours. 
However, AHRI has extended the applicability of its test standard, AHRI 
Standard 810-2007 with Addendum 1, ``Performance Rating of Automatic 
Commercial Ice Makers,'' to ice makers up to 4,000 lb ice/24 hours. 
Likewise, DOE extended the applicability of its test procedure to the 
same range. 77 FR 1591 (January 11, 2012). Stakeholders have not cited 
reasons that ice makers with capacities greater than 2,000 lb ice/24 
hours would not be able to achieve the same efficiency levels as those 
producing 2,000 lb ice/24 hours. Because it is possible that batch-type 
ice makers with harvest capacities from 2,500 to 4,000 lb ice/24 hours 
will be manufactured in the future, DOE does not find it unreasonable 
to set standards in this rulemaking for batch type ice makers with 
harvest capacities in the range up to 4,000 lb ice/24 hours. Therefore, 
DOE maintains its position to include large-capacity batch type ice 
makers in the scope of this rulemaking. In response to Hoshizaki's 
comment, DOE notes that each product class has flat levels, i.e. 
efficiency levels that do not vary with harvest capacity, beyond 2,000 
lb ice/24 hours.
c. Regulation of Potable Water Use
    Under EPACT 2005, water used for ice--referred to as potable 
water--was not regulated for automatic commercial ice makers.
    The amount of potable water used varies significantly among batch 
type automatic commercial ice makers (i.e., cube, tube, or cracked ice 
machines). Continuous type ice makers (i.e., flake and nugget machines) 
convert essentially all of the potable water to ice, using roughly 12 
gallons of water to make 100 lb ice. Batch type ice makers use an 
additional 3 to 38 gallons of water in the process of making 100 lb 
ice. This additional water is referred to as ``dump or purge water'' 
and is used to cleanse the evaporator of impurities that could 
interfere with the ice-making process.
    As indicated in the preliminary analysis and NOPR, DOE is not 
setting potable water limits for automatic commercial ice makers.
    The Natural Resource Defense Council (NRDC) commented that they 
previously urged the Department to propose standards for potable water 
use in batch type ice makers and that failure to do so is short-
sighted, given the increasing severity of drought conditions in many 
states, and may cause states to consider their own water use standards 
for ice makers. (NRDC, No. 90 at p. 54-1) NRDC urged DOE to reconsider 
its decision not to evaluate and set standards for potable water use. 
NRDC noted that EPCA was amended in 1992 explicitly to include water 
conservation as one of its purposes. (NRDC, No. 90 at p. 1)
    PG&E and SDG&E also recommended that DOE establish a maximum 
potable water use requirement. PG&E and SDG&E also added that in the 
event that DOE maintains that there is ambiguity in EPACT 2005 on 
whether DOE is required to regulate water usage and uses its discretion 
not to mandate a potable water standard PG&E and SDG&E request that DOE 
comment whether states are preempted from establishing such a standard. 
(PG&E and SDG&E, No. 89 at p. 4)
    In response to comments from NRDC, and PG&E and SDG&E, DOE was not 
given a specific mandate by Congress to regulate potable water. EPCA, 
as amended, explicitly gives DOE the authority to regulate water use in 
showerheads, faucets, water closets, and urinals (42 U.S.C. 6291(6), 
6295(j) and (k)), clothes washers (42 U.S.C. 6295(g)(9)), dishwashers 
(42 U.S.C. 6295(g)(10)), commercial clothes washers (42 U.S.C. 
6313(e)), and batch (cube) commercial ice makers. (42 U.S.C. 6313(d)) 
With respect to batch commercial ice makers (cube type machines), 
however, Congress explicitly set standards in EPACT 2005 at 42 U.S.C. 
6313(d)(1) only for condenser water and noted in a footnote to the 
table setting the standards that potable water use was not 
included.\24\ Congress thereby recognized both types of water, and did 
not provide direction to DOE with respect to potable water standards. 
This ambiguity gives the DOE considerable discretion to regulate or not 
regulate potable water. The U.S. Supreme Court has determined that, 
when legislative intent is ambiguous, a government agency may use its 
discretion in interpreting the meaning of a statute, so long as the 
interpretation is reasonable.\25\ In the case of ice makers, EPACT 2005 
is ambiguous on the subject of whether DOE must regulate water usage 
for purposes other than condenser water usage in cube-making machines, 
and DOE has chosen to use its discretion not to mandate a standard in 
this case. Pursuant to 42 U.S.C. 6297(b) and (c), preemption applies 
with respect to covered products and no State regulation concerning 
energy efficiency, energy use, or water use of such covered product 
shall be effective with respect to such product unless the State 
regulation meets the specified criteria under these provisions.
---------------------------------------------------------------------------

    \24\ Footnote to table at 42 U.S.C. 6313(d)(1).
    \25\ Nat'l Cable & Telecomms. Ass'n v. Brand X Internet Servs., 
545 U.S. 967, 986 (2005) (quoting Chevron U.S.A. Inc. v. Natural 
Res. Def. Council, Inc., 467 U.S. 837, 845 (1984)).
---------------------------------------------------------------------------

    DOE elected to not set potable water limits for automatic 
commercial ice makers in order to allow manufacturers to retain 
flexibility in this aspect of ice maker design. The regulation of ice 
maker energy use does in itself make high levels of potable water use 
untenable because energy use does increase as potable water use 
increases, since the additional water must be cooled down, diverting 
refrigeration capacity from the primary objective of cooling and 
freezing the water that will be delivered from the machine as ice.
    DOE notes that ENERGY STAR has adopted potable water limits for 
ENERGY STAR-compliant ice makers at 15 gal/100 lb ice for continuous 
equipment classes, 20 gal/100 lb ice for IMH and RCU batch classes, and 
25 gal/100 lb ice for SCU batch classes.\26\
---------------------------------------------------------------------------

    \26\ http://www.energystar.gov/index.cfm?c=comm_ice_machines.pr_crit_comm_ice_machines.
---------------------------------------------------------------------------

d. Regulation of Condenser Water Use
    As previously noted in section II.B.1, EPACT 2005 prescribes 
maximum condenser water use levels for water-cooled cube type automatic 
commercial ice makers. (42 U.S.C. 6313(d)) \27\ For units not currently 
covered by the standard (continuous machines of all harvest rates and 
batch machines with harvest rates exceeding 2,500 lb ice/24 hours), 
there currently are no limits on condenser water use.
---------------------------------------------------------------------------

    \27\ The table in 42 U.S.C. 6313(d)(1) states maximum energy and 
condenser water usage limits for cube type ice machines producing 
between 50 and 2,500 lb of ice per 24 hour period (lb ice/24 hours). 
A footnote to the table states explicitly the water limits are for 
water used in the condenser and not potable water used to make ice.

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

[[Page 4669]]

    In the preliminary analysis and the NOPR, DOE indicated its intent 
to primarily focus the automatic commercial ice maker rulemaking on 
energy use. DOE also noted that DOE is not bound by EPCA to 
comprehensively evaluate and propose reductions in the maximum 
condenser water consumption levels, and likewise has the option to 
allow increases in condenser water use, if this is a cost-effective way 
to improve energy efficiency.
    In the preliminary analysis, DOE stated that EPCA's 
anti[hyphen]backsliding provision in section 325(o)(1), which lists 
specific products for which DOE is forbidden from prescribing amended 
standards that increase the maximum allowable water use, does not 
include ice makers. However in response to the preliminary analysis, 
Earthjustice asserted that DOE lacks the authority to relax condenser 
water limits for water-cooled ice makers. Earthjustice argued that the 
failure of section 325(o)(1) to specifically call out ice maker 
condenser water use as a metric that is subject to the statute's 
prohibition against the relaxation of a standard is not determinative. 
On the contrary, Earthjustice maintained that the plain language of 
EPCA shows that Congress intended to apply the anti[hyphen]backsliding 
provision to ice makers. Earthjustice commented that section 342(d)(4) 
requires DOE to adopt standards for ice[hyphen]makers ``at the maximum 
level that is technically (DOE interprets the comment to mean 
technologically) feasible and economically justified, as provided in 
[section 325(o) and (p)].'' (42 U.S.C. 6313(d)(4)) Earthjustice stated 
that, by referencing all of section 325(o), the statute pulls in each 
of the distinct provisions of that subsection, including, among other 
things, the anti[hyphen]backsliding provision, the statutory factors 
governing economic justification, and the prohibition on adopting a 
standard that eliminates certain performance characteristics. By 
applying all of section 325(o) to ice[hyphen]makers, section 342(d)(4) 
had already made the anti[hyphen]backsliding provision applicable to 
condenser water use, according to Earthjustice. Finally, Earthjustice 
stated that even if DOE concludes that the plain language of EPCA is 
not clear on this point, the only reasonable interpretation is that 
Congress did not intend to grant DOE the authority to relax the 
condenser water use standards for ice makers. Earthjustice added that 
the anti-backsliding provision is one of EPCA's most powerful tools to 
improve the energy and water efficiency of appliances and commercial 
equipment, and Congress would presumably speak clearly if it intended 
to withhold its application to a specific product. (Earthjustice, No. 
47 at pp. 4-5)
    In the NOPR DOE maintained that the 42 U.S.C. Sec. 6295(o)(1) anti-
backsliding provisions apply to water in only a limited set of 
residential appliances and fixtures. Therefore, an increase in 
condenser water use would not be considered backsliding under the 
statute. Nevertheless, the DOE did not include increases in condenser 
water use as a technology option for the NOPR, NODA, and final rule.
    In response to the NOPR, NRDC stated that they disagree that DOE 
may lawfully relax water use standards. NRDC added that even if DOE 
were correct in stating that EPCA's anti-backsliding provision does not 
apply, as explored in EarthJustice's comment, DOE cannot relax the 
water efficiency levels set by Congress itself. (NRDC, No. 90 at p. 1)
    In this rule, DOE is not revising its NOPR position regarding the 
application of anti-backsliding to ACIM condenser water use. 
Nevertheless, DOE did not consider design options that would represent 
increase in condenser water use in its final rule analysis.
e. Continuous Models
    The EPACT 2005 amendments to EPCA did not set standards for 
continuous type ice makers. Pursuant to EPCA, DOE is required to set 
new or amended energy conservation standards for automatic commercial 
ice makers to: (1) Achieve the maximum improvement in energy efficiency 
that is technologically feasible and economically justified; and (2) 
result in significant conservation of energy. (42 U.S.C. 6295(o)(2)(A) 
and (o)(3)(B); 6313(d)(4))
    Hoshizaki stated that due to their small market share, continuous 
models should be considered separately from batch machines. (Hoshizaki, 
No, 124 at p. 1)
    DOE notes that it has conducted analysis for continuous models as 
part of separate equipment classes than batch type models and has set 
different energy standards for them.
f. Gourmet Ice Machines
    AHRI stated that this rulemaking has ignored the niche market of 
gourmet ice cubes. AHRI stated that gourmet ice cubes are two to three 
times larger than standard ice cubes. They are also harder and denser 
than conventional machine-made ice and require more energy to produce. 
AHRI noted that this issue impacts small business manufacturers. (AHRI, 
No. 128 at p. 5)
    In response to AHRI's comment regarding gourmet ice makers, DOE has 
not conducted separate analysis for such equipment. DOE has, however, 
considered small business impacts, as discussed in section IV.J.3.f. 
DOE notes that the ACIM rulemaking has provided stakeholders many 
opportunities to provide comment on the issues that would be important 
to consider in the analysis, including potential equipment classes 
associated with different types of ice, whether different types of ice 
provide specific utility that would be the basis of considering 
separate equipment classes, and any other issues associated with such 
ice that might affect the analysis. DOE does not have nor did it 
receive in response to requests for comments sufficient specific 
information to evaluate whether larger ice has specific consumer 
utility, nor to allow separate evaluation for such equipment of costs 
and benefits associated with achieving the efficiency levels considered 
in the rulemaking. In the absence of information, DOE cannot conclude 
that this type of ice has unique consumer utility justifying 
consideration of separate equipment classes. DOE notes that 
manufacturers of this equipment have the option seeking exception 
relief pursuant to 41 U.S.C. 7194 from DOE's Office of Hearings and 
Appeals.
2. Technology Assessment
    As part of the market and technology assessment, DOE developed a 
comprehensive list of technologies to improve the energy efficiency of 
automatic commercial ice makers, shown in Table IV.3. Chapter 3 of the 
final rule TSD contains a detailed description of each technology that 
DOE identified. DOE only considered in its analysis technologies that 
would impact the efficiency rating of equipment as tested under the DOE 
test procedure. The technologies identified by DOE were carried through 
to the screening analysis, which is discussed in section IV.C.
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BILLING CODE 6450-01-C
    The section below addresses the potential consideration of another 
technology option.
a. Alternative Refrigerants
    The Environmental Investigation Agency (EIA Global) urged DOE to 
include hydrocarbon refrigerants as an ACIM technology option. EIA 
Global expressed their concern that DOE's analysis will be incomplete 
without the inclusion of hydrocarbon refrigerants and that the high 
global warming potential (GWP) of current ACIM refrigerants will 
further damage the stability of the climate, thus offsetting the 
efficiency gains associated with standards. (EIA Global, No. 80 at p. 
1)
    EIA Global commented that it is likely that EPA will include 
hydrocarbons as acceptable ACIM refrigerants in the near future and 
urged DOE to bring a SNAP petition to do so. EIA Global added that 
accepting hydrocarbons for use in ACIMs with charge sizes of 150g or 
less is highly likely and that according to a United Nations 
Environment Programme (UNEP) report, such refrigerants have lower 
viscosity, resulting in improved cooling efficiency and reducing energy 
consumption by 18 percent. (EIA Global, No. 80 at p. 2) EIA Global 
noted that DOE should set standards that anticipate future 
alternatives, rather than being limited to what is available today. 
(EIA Global, No. 80 at p. 4-5)
    EIA Global stated that including hydrocarbon refrigerants in the 
analysis will be of little burden to DOE because Scotsman, Hoshizaki, 
and Manitowoc already sell hydrocarbon machines throughout Europe and 
other international markets and noted that these three manufacturers 
have observed energy savings associated with use of these refrigerants. 
(EIA Global, No. 80 at p. 1-4)
    In response to EIA Global's comments, DOE notes that hydrocarbon 
refrigerants have not yet been approved by the EPA SNAP program and 
hence cannot be considered as a technology option in DOE's analysis. 
DOE also notes that, while it is possible that HFC refrigerants 
currently used in automatic commercial ice makers may be restricted by 
future rules, DOE cannot speculate on the outcome of a rulemaking in 
progress and can only consider in its rulemakings rules that are 
currently in effect. Therefore, DOE has not included possible outcomes 
of a potential EPA SNAP rulemaking. This position is consistent with 
past DOE rulings, such as in the 2014 final rule for commercial 
refrigeration equipment. 79 FR 17725 (March 28, 2014) DOE notes that 
recent proposals by the EPA to allow use of hydrocarbon refrigerants or 
to impose new restrictions on the use of HFC refrigerants do not 
address automatic commercial ice maker applications. 79 FR 46126 
(August 6, 2014) DOE acknowledges that there are government-wide 
efforts to reduce emissions of HFCs, and such actions are being pursued 
both through international diplomacy as well as domestic actions. DOE, 
in concert with other relevant agencies, will continue to work with 
industry and other stakeholders to identify safer and more sustainable 
alternatives to HFCs while

[[Page 4671]]

evaluating energy efficiency standards for this equipment. As mentioned 
in section IV.A.4, if a manufacturer believes that its design is 
subjected to undue hardship by regulations, the manufacturer may 
petition DOE's Office of Hearing and Appeals (OHA) for exception relief 
or exemption from the standard pursuant to OHA's authority under 
section 504 of the DOE Organization Act (42 U.S.C. 7194), as 
implemented at subpart B of 10 CFR part 1003. OHA has the authority to 
grant such relief on a case-by-case basis if it determines that a 
manufacturer has demonstrated that meeting the standard would cause 
hardship, inequity, or unfair distribution of burdens.

C. Screening Analysis

    In the technology assessment section of this final rule, DOE 
presents an initial list of technologies that can improve the energy 
efficiency of automatic commercial ice makers. The purpose of the 
screening analysis is to evaluate the technologies that improve 
equipment efficiency to determine which of these technologies is 
suitable for further consideration in its analyses. To do this, DOE 
uses four screening criteria--design options will be removed from 
consideration if they are not technologically feasible; are not 
practicable to manufacture, install, or service; have adverse impacts 
on product utility or product availability; or have adverse impacts on 
health or safety. 10 CFR part 430, subpart C, appendix A, section 
(4)(a)(4). See chapter 4 of the final rule TSD for further discussion 
of the screening analysis. Another consideration is whether a design 
option provides a unique pathway towards increasing energy efficiency 
and that pathway is a proprietary design that a manufacturer can only 
get from one source. In this instance, such design option would be 
eliminated from consideration because it would require manufacturers to 
procure it from a sole source. Table IV.4 shows the EPCA criteria and 
additional criteria used in this screening analysis, and the design 
options evaluated using the screening criteria.
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[[Page 4672]]

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[[Page 4673]]

[GRAPHIC] [TIFF OMITTED] TR28JA15.002

BILLING CODE 6450-01-C
a. General Comments
    Manitowoc expressed its agreement with the screening analysis. 
(Manitowoc, No. 92 at p. 3) However, Scotsman requested that the 
following additional criteria be used in the screening analysis: Impact 
on end-user facility and operations, impact on end-user profit-
generating beverage sales, impact on machine footprint, impact on end-
user ``repair existing'' or ``purchase new'' decision hierarchy, impact 
on ACIM service and installation network support capability, and impact 
on manufacturer component tooling/fixture obsolescence prior to 
depreciation. (Scotsman, No. 85 at p. 3b-4b)
    In response to Scotsman comment, DOE notes that while DOE's 
screening analysis specifically focuses on the four criteria identified 
in the process rule (see 10 CFR part 430, subpart C, appendix A, 
section (4)(a)(4)), some of the suggested screening criteria outlined 
in Scotsman's comment are taken into account in other parts of the 
analysis. Specifically, impacts to end user facility and operations, 
including installations costs, are considered in the life cycle cost 
analysis described in section IV.G. Impacts regarding manufacturing 
tooling are examined in the manufacturing impact analysis described in 
section IV.J.
b. Drain Water Heat Exchanger
    Batch ice makers can benefit from drain water thermal exchange that 
cools the potable water supply entering the sump, thereby reducing the 
energy required to cool down and freeze the water. Technological 
feasibility is demonstrated by one commercially available drain water 
thermal heat exchanger that is currently sold only for aftermarket 
installation. This product is designed to be installed externally to 
the ice maker, and both drain water and supply water are piped through 
the device.
    Drain water heat exchangers, both internally mounted and externally 
mounted, are design options that can increase the energy efficiency of 
automatic commercial ice makers. The current test procedures would give 
manufacturers credit for efficiency improvement of drain water heat 
exchangers, including externally mounted drain water heat exchangers as 
long as they are provided with the machine and the installation 
instructions for the machine indicate that the heat exchangers are part 
of the machine and must be installed as part of the overall 
installation.
    In response to the NODA, Manitowoc stated that drain water heat 
exchangers have not been proven in the industry (DOE assumes that this 
comment addresses issues such as their reliability rather than their 
potential for energy savings) and their use is likely to result in 
lower reliability due to issues with fouling and clogging associated 
with mineral particles that naturally accumulate in the dump water for 
batch cycle machines. Manitowoc also added that the high costs for 
drain water heat exchangers are not justified by their efficiency 
gains. (Manitowoc, No. 126 at p. 2) AHRI stated that a drain water heat 
exchanger cannot reasonably be implemented in a 22-inch IMH-A-Small-B 
unit. (AHRI, No. 128 at p. 2)
    DOE notes that drain water heat exchangers have been discussed as a 
possible technology option from the framework stage of this rulemaking. 
DOE has investigated the feasibility of drain water heat exchangers 
through review of product literature, patents, reports on 
installations, and product teardowns, and has also conducted testing to 
evaluate the claims of efficiency improvement for the technology. While 
fouling of the heat exchanger is a potential concern based on the 
higher mineral concentration in dump water, heat exchangers designed 
for use with ice makers have been designed with electrically insulated 
gaskets to substantially reduce deposition of particulates on heat 
exchanger surfaces.\28\ Moreover, drain water heat exchangers would 
also benefit from typical maintenance of ice machines that includes 
dissolution of such mineral deposits on all components that come into 
contact with potable water. DOE is not aware of data showing that the 
units sold have substantial reliability issues as a consequence of 
fouling in retrofit applications. Further, Manitowoc has not provided 
information or test data showing that they would reduce reliability. 
DOE also notes that answering the question of whether the inclusion of 
a drain water heat exchanger is cost-effective is a goal of the DOE 
analyses and is not considered during the screening analysis. DOE has 
examined the added cost of a drain water heater along with the energy 
savings resulting from its use and has found drain water heat 
exchangers to be cost justified for certain equipment classes.
---------------------------------------------------------------------------

    \28\ Welch, D.L., et al., U.S. Patent No. 5,555,734, Sep. 17, 
1996.
---------------------------------------------------------------------------

    In response to AHRI's comment suggesting that drain water heat 
exchangers may not fit in a 22-inch IMH-A-Small-B cabinet, DOE notes 
that the heat exchanger would be mounted outside the unit, rather than 
enclosed within the cabinet. If AHRI's comment did not mean to indicate 
that the objection was to placement of the heat exchanger within the 
unit, the comment also did not make clear why such a component could 
not be implemented specifically for a 22-inch wide unit.
    In response to AHRI's comment suggesting that drain water heat 
exchangers may not fit in a 22-inch IMH-A-Small-B cabinet, DOE notes 
that the heat exchanger would be mounted outside the unit, rather than 
enclosed within the cabinet. If AHRI's comment did not mean to indicate 
that the objection was placement of the heat exchanger within the unit, 
the comment also did not make clear why such a component could not be 
implemented

[[Page 4674]]

specifically for a 22-inch wide unit. DOE did screen in this 
technology.
c. Tube Evaporator Design
    Among the technologies that DOE considered were tube evaporators 
that use a vertical shell and tube configuration in which refrigerant 
evaporates on the outer surfaces of the tubes inside the shell, and the 
freezing water flows vertically inside the tubes to create long ice 
tubes that are cut into smaller pieces during the harvest process. Some 
of the largest automatic commercial ice makers in the RCU-NRC-Large-B 
and the IMH-W-Large-B equipment classes use this technology. However, 
DOE concluded that implementation of this technology for smaller 
capacity ice makers would significantly impact equipment utility, due 
to the greater weight and size of these designs, and to the altered ice 
shape. DOE noted that available tube ice makers (for capacities around 
1,500 lb ice/24 hours and 2,200 lb ice/24 hours) were 150 to 200 
percent heavier than comparable cube ice makers. Based on the impacts 
to utility of this technology, DOE screened out tube evaporators from 
consideration in this analysis.
d. Low Thermal Mass Evaporator Design
    DOE's analysis did not consider low thermal mass evaporator 
designs. Reducing evaporator thermal mass of batch type ice makers 
reduces the heat that must be removed from the evaporator after the 
harvest cycle, and thus decreases refrigeration system energy use. DOE 
indicated during the preliminary analysis that it was concerned about 
the potential proprietary status of such evaporator designs, since DOE 
is aware of only one manufacturer that produces equipment with such 
evaporators. DOE has not altered its decision to screen out this 
technology in its analysis.
e. Microchannel Heat Exchangers
    Through discussions with manufacturers, DOE has determined that 
there are no instances of energy savings associated with the use of 
microchannel heat exchangers in ice makers. Manufacturers also noted 
that the reduced refrigerant charge associated with microchannel heat 
exchangers can be detrimental to the harvest performance of batch type 
ice makers, as there is not enough charge to transfer heat to the 
evaporator from the condenser.
    DOE contacted microchannel manufacturers to determine whether there 
were energy savings associated with use of microchannel heat exchangers 
in automatic commercial ice makers. These microchannel manufacturers 
noted that investigation of microchannel was driven by space 
constraints rather than efficiency.
    Because the potential for energy savings is inconclusive, based on 
DOE analysis as well as feedback from manufacturers and heat exchanger 
suppliers, and based on the potential utility considerations associated 
with compromised harvest performance in batch type ice makers 
associated with this heat exchanger technology's reduced refrigerant 
charge, DOE screened out microchannel heat exchangers as a design 
option in this rulemaking.
f. Smart Technologies
    While there may be energy demand benefits associated with use of 
``smart technologies'' in ice makers in that they reduce energy demand 
(e.g., shift the refrigeration system operation to a time of utility 
lower demand), DOE is not aware of any commercialized products or 
prototypes that also demonstrate improved energy efficiency in 
automatic commercial ice makers. Demand savings alone do not impact 
energy efficiency, and DOE cannot consider technologies that do not 
offer energy savings as measured by the DOE test procedure. Since the 
scope of this rulemaking is to consider energy conservation standards 
that increase the energy efficiency of automatic commercial ice makers 
this technology option has been screened out because it does not save 
energy as measured by the test procedure.
g. Motors
    Manufacturers Follett and Manitowoc provided comment regarding the 
use of higher efficiency motors in ACIMs. Follett stated that they are 
not aware of gear motors more efficient than the hypoid motors they 
use. (Follett, No. 84 at p. 5) Manitowoc stated that they do not 
consider brushless direct-current (DC) fan motors to be cost effective. 
(Manitowoc, Public Meeting Transcript, No. 70 at p. 157-159)
    In response to Follett's comment, DOE notes that its consideration 
of motor efficiency applies to the prime mover portion of the motor, 
not the gear drive. Gear motor assemblies include both a motor which 
converts electricity to shaft power and a gear drive, which converts 
the high rotational speed of the motor shaft to the rotational speed 
required by the auger. DOE screened in higher efficiency options for 
the motor, but did not consider higher-efficiency gear drives. In 
response to Manitowoc, the cost-effectiveness of a given technology, 
such as DC fan motors, is not a factor that is considered when 
screening technologies.

D. Engineering Analysis

    The engineering analysis determines the manufacturing costs of 
achieving increased efficiency or decreased energy consumption. DOE 
historically has used the following three methodologies to generate the 
manufacturing costs needed for its engineering analyses: (1) The 
design-option approach, which provides the incremental costs of adding 
to a baseline model design options that will improve its efficiency; 
(2) the efficiency-level approach, which provides the relative costs of 
achieving increases in energy efficiency levels, without regard to the 
particular design options used to achieve such increases; and (3) the 
cost-assessment (or reverse engineering) approach, which provides 
``bottom-up'' manufacturing cost assessments for achieving various 
levels of increased efficiency, based on detailed data as to costs for 
parts and material, labor, shipping/packaging, and investment for 
models that operate at particular efficiency levels.
    As discussed in the Framework document, preliminary analysis, and 
NOPR analysis, DOE conducted the engineering analyses for this 
rulemaking using an approach that combines the efficiency level, design 
option, and reverse engineering approaches to develop cost-efficiency 
curves for automatic commercial ice makers. DOE established efficiency 
levels defined as percent energy use lower than that of baseline 
efficiency products. DOE's engineering analysis is based on 
illustrating a typical design path to achieving the specified 
percentage efficiency improvements at each level through the 
incorporation of a group of design options. Finally, DOE developed 
manufacturing cost models based on reverse engineering of products to 
develop baseline manufacturer production costs (MPCs) and to supplement 
incremental cost estimate associated with efficiency improvements.
    DOE directly analyzed 19 ice maker configurations representing 
different classes, capacities, and physical sizes. To develop cost-
efficiency curves, DOE collected information from multiple sources to 
characterize the manufacturing cost and energy use reduction of each of 
the design options or grouping of design options. DOE conducted an 
extensive review of product literature on hundreds of ice makers and 
selected 50 of them for testing and reverse engineering.
    To gather cost and performance information of different ice maker

[[Page 4675]]

design strategies, DOE conducted interviews with ice maker 
manufacturers and component vendors of compressors and fan motors 
during the preliminary, NOPR, NODA, and final phases of the rulemaking 
Cost information from the vendor interviews and discussions with 
manufacturers provided input to the manufacturing cost model. DOE 
determined incremental costs associated with specific design options 
from vendor information, discussion with manufacturers, and the cost 
model. DOE calculated energy use reduction based on test data, data 
provided in comments, data provided in manufacturer interviews, and 
using the FREEZE program, The reverse engineering, equipment testing, 
vendor interviews, and manufacturer interviews provided input for the 
energy analysis. Information about specific ice makers also provided 
equipment examples against which the modeling results could be 
calibrated. The final incremental cost estimates and the energy 
modeling results together constitute the energy efficiency curves 
presented in the final rule TSD chapter 5.
    The cost-efficiency relationships were derived from current market 
designs so that efficiency calculations could be verified by ratings or 
testing. Another benefit of using market designs is that the efficiency 
performance can be associated with the use of particular design options 
or design option groupings. The cost of these design option changes can 
then be isolated and also verified. In earlier stages of the rule DOE 
had limited information on current market designs and relied on the 
FREEZE model to supplement and extend its design-option energy modeling 
analysis. For the NODA and Final Rule, DOE has expanded its knowledge 
base of market designs through its own program of testing and reverse 
engineering, but also received test and design information from ice 
maker manufacturers. The cost-efficiency curves are now based on these 
market designs, test data obtained both through DOE testing and from 
manufacturers, specific information about component performance (e.g. 
motor efficiency) on which stakeholders have been able to comment, and 
in some instances use of the FREEZE model. DOE limited the projected 
efficiency levels for groups of design options found in available 
equipment to the maximum available efficiency levels associated with 
the specific classes. The groups of design options that DOE's analysis 
predicted would be required to attain these maximum efficiency levels 
were consistent with those of the maximum available ice makers or were 
found to provide a conservative estimate of cost compared to the market 
designs of equal efficiency employing different design option groups to 
attain the level.
    Additional details of the engineering analysis are available in 
chapter 5 of the final rule TSD.
1. Representative Equipment for Analysis
    In performing its engineering analysis, DOE selected representative 
units within specific equipment types to serve as analysis points in 
the development of cost-efficiency curves. DOE selected models that 
were representative of the typical offerings within a given equipment 
class. DOE sought to select models having features and technologies 
typically found in both the minimum and maximum efficiency equipment 
currently available on the market.
    DOE received several comments from interested parties regarding 
those equipment classes not directly analyzed in the NOPR. Follett 
commented that they object to the fact that only one RCU-Large-C was 
purchased for testing, given that it represents nearly half of 
Follett's sales. Follett added that they also object to the fact that 
DOE did not analyze IMH-W-Small-C, IMH-W-Large-C, RCU-Small-C, and RCU-
Large-C, which comprise a significant portion of Follett's revenue. 
Follett expressed its fear that DOE's approach could require Follett to 
enact design changes that are neither technologically feasible nor 
economically justified. (Follett, No. 84 at p. 7-8) Follett added that 
all manufacturers have unique designs that should be noted during 
reverse engineering analyses. (Follett, No. 84 at p. 8) Similarly, 
Hoshizaki commented that DOE only analyzed less than 1% of available 
units and that analysis did not include testing to validate proposed 
design changes. (Hoshizaki, No. 86 at p. 1)
    Ice-O-Matic noted that half cube machines represent a significant 
portion of the industry and expressed concern that DOE did not attempt 
to analyze half cube machines. (Ice-O-Matic, No. 121 at p. 3)
    In response to Ice-o-Matic, DOE notes that it focused its analysis 
on full cube machines based on the observation that half cube machines 
may have an efficiency advantage over full cube machines. For some 
models that are available in both versions, the energy use ratings are 
different, and generally the half-dice version has lower energy. This 
is consistent with the fact that the additional copper strips that 
divide the full-cube cells into two half-cube cells also provide 
additional heat transfer surface area that can enhance ice maker 
performance.
    In response to Follett and Hoshizaki's comments, DOE is limited in 
time and resources, and as such, cannot directly analyze all models. 
DOE responded to NOPR comments regarding lack of analysis of continuous 
RCU units by adding direct analysis of a continuous RCU configuration 
with capacity of 800 lb ice/24 hours. This capacity is near the border 
between the small and large RCU continuous classes, hence it provides 
representation for both capacity ranges. DOE reviewed Follett's 
available continuous RCU ice maker data, as listed in the ENERGY 
STAR(copyright) database, and found that nearly all of the models meet 
the standard set in this rule. Of the two that don't, one has adjusted 
energy use within 1 percent of the standard, and one has energy use 
within 6 percent.
    DOE disagrees with Hoshizaki's statement that DOE analyzed less 
than one percent of available units and believes it mischaracterizes 
DOE's analysis. DOE identified 656 current ice maker models in its 
research of available databases and Web sites. DOE did not analyze 
Hoshizaki batch ice makers, due to their proprietary evaporator 
design--hence the 91 Hoshizaki batch models would not have been 
considered in DOE's analysis for this reason. DOE developed 19 
analyses, 3.4 percent of the remaining 565 models. Moreover, DOE 
asserts that the range of models analyzed provides a good 
representation of ice maker efficiency trends. DOE carefully selected 
the analyzed units to represent 13 of the 25 ice maker equipment 
classes listed in Table IV.2 representing roughly 93 percent of ice 
maker shipments.
    DOE does not generally conduct prototype testing to verify the 
energy savings projections associated with specific design changes. For 
this, DOE has requested data from stakeholders who have done such work. 
DOE received such test data, some of it through confidential 
information exchange with its contractor, and considered this data in 
the analysis. Further, DOE also considered test data and design details 
of commercially available ice makers, which it used to calibrate its 
projections of energy reductions associated with groups of design 
options.
    In many cases, DOE leveraged information found by directly 
analyzing similar product classes to supplement the analysis of those 
secondary equipment classes which were not

[[Page 4676]]

directly analyzed. These similar equipment classes are listed in Table 
IV.6. The details of why these equipment classes were chosen can be 
found in chapter 5 of the final rule TSD.

     Table IV.6--Directly Analyzed Equipment Classes Used To Develop
                     Standards for Secondary Classes
------------------------------------------------------------------------
                                           Analyzed equipment class
      Secondary equipment class        associated with efficiency level
                                         for secondary equipment class
------------------------------------------------------------------------
RCU-NRC-Small-B.....................  RCU-NRC-Large-B.
RCU-RC-Small-B......................  RCU-NRC-Large-B.
RCU-RC-Large-B......................  RCU-NRC-Large-B.
SCU-W-Small-B.......................  SCU-W-Large-B.
IMH-W-Small-C.......................  IMH-A-Small-C.
IMH-W-Large-C.......................  IMH-A-Large-C.
RCU-NRC-Large-C.....................  RCU-NRC-Small-C.
RCU-RC-Small-C......................  RCU-NRC-Small-C.
RCU-RC-Large-C......................  RCU-NRC-Small-C.
SCU-W-Small-C.......................  SCU-A-Small-C.
SCU-W-Large-C.......................  SCU-A-Small-C.
SCU-A-Large-C.......................  SCU-A-Small-C.
------------------------------------------------------------------------

2. Efficiency Levels
a. Baseline Efficiency Levels
    EPCA, as amended by the EPACT 2005, prescribed the following 
standards for batch type ice makers, shown in Table IV.7, effective 
January 1, 2010. (42 U.S.C. 6313(d)(1)) For the engineering analysis, 
DOE used the existing batch type equipment standards as the baseline 
efficiency level for the equipment types under consideration in this 
rulemaking. Also, DOE applied the standards for equipment with harvest 
capacities up to 2,500 lb ice/24 hours as baseline efficiency levels 
for the larger batch type equipment with harvest capacities between 
2,500 and 4,000 lb ice/24 hours, which are currently not regulated. DOE 
applied two exceptions to this approach, as discussed below.
    For the IMH-W-Small-B equipment class, DOE slightly adjusted the 
baseline energy use level to close a gap between the IMH-W-Small-B and 
the IMH-W-Medium-B equipment classes. For equipment in the IMH-A-Large-
B equipment class with harvest capacity above 2,500 lb ice per 24 
hours, DOE chose a baseline efficiency level equal to the current 
standard level at the 2,500 lb ice per 24 hours capacity. In its 
analysis, DOE is treating the constant portion of the IMH-A-Large-B 
equipment class as a separate equipment class, IMH-A-Extended-B.
    As noted in section IV.B.1.d DOE is not proposing adjustment of 
maximum condenser water use standards for batch type ice makers. The 
section also generally discusses DOE regulation of condenser water. 
First, DOE's authority does not extend to regulation of water use, 
except as explicitly provided by EPCA. Second, DOE determined that 
increasing condenser water use standards to allow for more water flow 
in order to reduce energy use is not cost-effective. The details of 
this analysis are available in chapter 5 of the final rule TSD.
    For water-cooled batch equipment with harvest capacity less than 
2,500 lb ice per 24 hours, the baseline condenser water use is equal to 
the current condenser water use standards for this equipment.
    For water-cooled equipment with harvest capacity greater than 2,500 
lb ice per 24 hours, DOE set maximum condenser water standards equal to 
the current standard level for the same type of equipment with a 
harvest capacity of 2,500 lb ice per 24 hours--the proposed standard 
level would not continue to drop as harvest capacity increases, as it 
does for equipment with harvest capacity less than 2,500 lb ice per 24 
hours.

                                               Table IV.7--Baseline Efficiency Levels for Batch Ice Makers
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                            Maximum energy use kWh/100 lb  Maximum  condenser  water use
         Equipment type                Type of cooling       Harvest rate lb ice/24 hours                ice                      * gal/100 lb ice
--------------------------------------------------------------------------------------------------------------------------------------------------------
Ice--Making Head................  Water...................  =500 and =1,436                         4.0                            145.
                                  Air.....................  =450 and =2,500                         4.1                            Not Applicable.
Remote Condensing (but not        Air.....................  =1,000                         5.10                           Not Applicable.
Remote Condensing and Remote      Air.....................  =934                           5.30                           Not Applicable.
Self--Contained.................  Water...................  =200                           7.60                           For =2,500: 112.
                                  Air.....................  =175                           9.80                           Not Applicable.
--------------------------------------------------------------------------------------------------------------------------------------------------------
* Water use is for the condenser only and does not include potable water used to make ice.
** H = harvest rate in pounds per 24 hours, indicating the water or energy use for a given harvest rate.
Source: 42 U.S.C. 6313(d).

    Currently there are no DOE energy standards for continuous type ice 
makers. During the preliminary analysis, DOE developed baseline 
efficiency levels using energy use data available from several sources, 
as discussed in chapter 3 of the preliminary TSD. DOE chose baseline 
efficiency levels that would be met by nearly all ice makers 
represented in the databases, using ice hardness assumptions of 70 for 
flake ice makers and 85 for nugget ice makers, since ice hardness data 
was not available at the time. For the NOPR analysis, DOE used 
available information published in the AHRI Directory of Certified 
Product Performance, the California Energy Commission, the ENERGY STAR 
program, and vendor Web sites, to update its icemaker ratings database 
(``DOE icemaker ratings database''). The AHRI published equipment 
ratings including ice hardness data, measured as prescribed by ASHRAE 
29-2009, which is incorporated by reference in the DOE test procedure. 
DOE recreated

[[Page 4677]]

its baseline efficiency levels for continuous type ice makers based on 
the available AHRI data, considering primarily the ice makers for which 
ice hardness data were available. DOE also adjusted the harvest 
capacity break points for the continuous equipment classes based on the 
new data.
    The baseline efficiency levels used in the NOPR analysis for 
continuous type ice makers are presented in Table IV.8. For the remote 
condensing equipment, the large-capacity remote compressor and large-
capacity non-remote compressor classes have been separated and are 
different by 0.2 kWh/100 lb, identical to the batch equipment 
differential for the large batch classes.

                                 Table IV.8--NOPR Baseline Efficiency Levels for Continuous Ice Maker Equipment Classes
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                            Maximum energy use kWh/100 lb  Maximum condenser water use *
         Equipment type                Type of cooling       Harvest rate lb ice/24 hours               ice *                      gal/100 lb ice
--------------------------------------------------------------------------------------------------------------------------------------------------------
Ice-Making Head.................  Water...................  Small (=900)                   5.1                            2,500: 116.
                                  Air.....................  Small (=700)                   6.6                            Not Applicable.
Remote Condensing (Remote         Air.....................  Small (=850)                   6.3                            Not Applicable.
Remote Condensing (Non-remote     Air.....................  Small (=850)                   6.1                            Not Applicable.
Self-Contained..................  Water...................  Small (=900)                   6.1                            2,500: 90.
                                  Air.....................  Small (=700)                   7.1
--------------------------------------------------------------------------------------------------------------------------------------------------------
* H = harvest capacity in lb ice/24 hours

    After the publication of the NOPR and the NOPR public meeting, DOE 
received two comments from interested parties regarding its 
establishment of baseline models.
    In response to the NOPR, Scotsman commented that there is not 
sufficient historical data (greater than 1 year) to establish 
continuous type baselines with statistical confidence. Scotsman added 
that the current ASHRAE standard is biased against low-capacity 
machines, and therefore does not accurately represent the energy usage 
of the machine when corrected for hardness factor. (Scotsman, No. 85 at 
p. 3b)
    DOE has found multiple sources of information regarding the energy 
efficiency of continuous ice machines on the market. As noted 
previously, DOE investigated information published in the AHRI 
Directory of Certified Product Performance, the California Energy 
Commission, the ENERGY STAR program, and vendor Web sites to inform the 
establishment of a baseline for continuous models. In regards to 
Scottsman's comment that the standard is biased against low capacity 
machines, DOE has set its baseline levels while considering continuous 
model energy use that has been adjusted using the current ASHRAE test 
standard. If the test is biased against low-capacity machines, this 
bias should be reflected in the data and already be accounted for in 
the selected baseline levels.
    Hoshizaki stated that they believe the baseline levels presented in 
the NOPR are too harsh for continuous equipment as it leaves many 
ENERGY STAR units unable to meet the minimum energy efficiency 
baseline. Hoshizaki noted that DOE based its analysis on the 2012 AHRI 
listing. Hoshizaki requested that DOE reassess the baseline data for 
all current continuous models as many more units have since been listed 
on AHRI's Web site. (Hoshizaki, No. 86 at p. 2-3) Similarly, Follett 
commented that some of the data on continuous type ice makers were not 
available in 2012, since they were not a part of the ENERGY STAR 
program until 2013, and that the baseline line might move up if recent 
data was added to the plot. (Follet, Public Meeting Transcript, No. 70 
at p. 76-78) PGE/SDG&E commented that they support DOE's updating their 
database with new data from all sources, including the CEC, AHRI, and 
NRCan databases. (PG&E and SDG&E, No. 89 at p. 3)
    In response to Hoshizaki's comment about ENERGY STAR-rated 
continuous models, for which there are currently no federal standard 
levels that would clearly represent the baseline efficiency levels, DOE 
revised its continuous class baselines so that no ENERGY STAR-rated 
continuous models have energy use higher than the baseline. The revised 
baseline efficiency levels for the continuous SCU classes are shown in 
Table IV.9 below. However, DOE notes that baseline efficiency levels 
are not required to be set at a level with which all commercially 
available equipment would be compliant. There are some IMH-W models and 
some IMH-A models that have energy use higher than the selected 
baseline levels--this is illustrated in the comparison of equipment 
data and efficiency levels in Chapter 3 of the TSD. DOE selected 
baseline efficiency levels that provide a good representation of the 
highest energy use exhibited by models available on the market with the 
exclusion of a few outliers (i.e. models exhibiting very different 
energy use than the majority of models).

[[Page 4678]]

                             Table IV.9--Modified Baseline Efficiency Levels for SCU Continuous Ice Maker Equipment Classes
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                             Maximum  energy use  kWh/100  Maximum  condenser  water use
         Equipment type                Type of cooling       Harvest rate  lb ice/24 hours             lb ice *                   * gal/100 lb ice
--------------------------------------------------------------------------------------------------------------------------------------------------------
Self-Contained..................  Water...................  Small (=900)                   6.1                            2,500: 90.
                                  Air.....................  Small (=200 and                11.84--0.0078H                 Not Applicable.
                                                            = 700)               6.38                           Not Applicable.
--------------------------------------------------------------------------------------------------------------------------------------------------------
* H = harvest capacity in lb ice/24 hours.

    In response to the comments related to data sources DOE notes that 
it has continued to update the analysis with new data as it becomes 
available. This includes new information published in the AHRI 
Directory of Certified Product Performance, the California Energy 
Commission and the ENERGY STAR program.
    In response to the NODA analysis, Hoshizaki again stated that DOE 
has not conducted enough analysis to accurately portray the baseline 
efficiency levels of continuous models (Hoshizaki, No. 124 at p. 1) 
NAFEM also stated that the NODA continuous unit baselines do not 
reflect the current models in the marketplace. (NAFEM, No. 123 at p. 2)
    DOE has evaluated all available data sources in its determination 
of the baseline efficiency levels for continuous units. However, as 
stated above, DOE notes that the baseline level selected is not 
necessarily the least efficient equipment on the market. As part of 
this review of data sources, DOE has modified the baseline condenser 
water use levels for IMH-W continuous classes such that they are 10 
percent below the IMH-W batch baseline water use levels.
b. Incremental Efficiency Levels
    For each of the 11 analyzed batch type ice-maker equipment classes 
and the four analyzed continuous ice maker equipment classes, DOE 
established a series of incremental efficiency levels for which it has 
calculated incremental costs. DOE chose these classes to be 
representative of all ice-making equipment classes, and grouped non-
analyzed equipment classes with similar analyzed equipment classes 
accordingly in the downstream analysis. Table IV.10 shows the selected 
incremental efficiency levels considered in the final rule analysis for 
batch ice makers, and Table IV.11 shows the incremental efficiency 
levels considered for continuous ice makers.

                 Table IV.10--Incremental Efficiency Levels for Batch Ice Maker Equipment Classes Considered in the Final Rule Analysis
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                Harvest capacity rate lb ice/24
                                                             hours
              Equipment type *               ------------------------------------   EL 2 **   EL 3 EL 3A  EL 4 EL 4A   EL 5 (%)    EL 6 (%)    EL 7 (%)
                                                                  Representative      (%)       *** (%)     *** (%)
                                                     Range           capacity
--------------------------------------------------------------------------------------------------------------------------------------------------------
IMH-W-Small-B...............................                =500 and =1,436           1,500           8  ..........  ..........  ..........  ..........  ..........
IMH-W-Large-B...............................             >=1,436           2,600           7  ..........  ..........  ..........  ..........  ..........
IMH-A-Small-B...............................                =450             800          10          15          20          23  ..........  ..........
                                                                                                      16
IMH-A-Large-B...............................               >=450           1,500          10          12  ..........  ..........  ..........  ..........
--------------------------------------------------------------------------------------------------------------------------------------------------------
RCU-NRC-Small-B.............................  ..................                                   Not Directly Analyzed
--------------------------------------------------------------------------------------------------------------------------------------------------------
RCU-NRC-Large-B.............................             >=1,000           1,500          10          15          17  ..........  ..........  ..........
RCU-NRC-Large-B.............................             >=1,000           2,400          10          14  ..........  ..........  ..........  ..........
--------------------------------------------------------------------------------------------------------------------------------------------------------
RCU-RC-Small-B..............................                =934                                   Not Directly Analyzed
--------------------------------------------------------------------------------------------------------------------------------------------------------
SCU-W-Small-B...............................                >200                                   Not Directly Analyzed
--------------------------------------------------------------------------------------------------------------------------------------------------------
SCU-W-Small-B...............................               >=200             300          10          15          20          25          30  ..........
SCU-A-Small-B...............................                =175             200          10          15          20          25          29  ..........
--------------------------------------------------------------------------------------------------------------------------------------------------------
* See Table III.1 for a description of these abbreviations.
** EL = efficiency level; EL 1 is the baseline efficiency level, while EL 2 through EL 7 represent increased efficiency levels.
*** DOE considered intermediate efficiency levels 3A and 4A for some equipment classes.

            Table IV.11--Incremental Efficiency Levels for Continuous Type Ice Maker Equipment Classes Considered in the Final Rule Analysis
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                           Harvest capacity lb ice/24 hours
                                                         ------------------------------------   EL 2 **
                    Equipment Type *                                          Representative      (%)      EL 3 (%)    EL 4 (%)    EL 5 (%)    EL 6 (%)
                                                                 Range           capacity
--------------------------------------------------------------------------------------------------------------------------------------------------------
IMH-W-Small-C...........................................                =900                             Not Directly Analyzed
--------------------------------------------------------------------------------------------------------------------------------------------------------
IMH-A-Small-C...........................................                =700             820          10          15          20          23  ..........
RCU-Small-C.............................................                =850                             Not Directly Analyzed
--------------------------------------------------------------------------------------------------------------------------------------------------------
SCU-W-Small-C...........................................                =900                      No existing products on the market
--------------------------------------------------------------------------------------------------------------------------------------------------------
SCU-A-Small-C...........................................                =700                      No existing products on the market
--------------------------------------------------------------------------------------------------------------------------------------------------------
* See Table III.1 for a description of these abbreviations.
** EL 1 is the baseline efficiency level, while EL 2 through EL 6 represent increased efficiency levels.

    In response to the NODA, Hoshizaki stated that ``there are no 
models that achieve the NODA levels in SCU-A, IMH-W large, or RCU-A 
large'' equipment classes. Hoshizaki added that these same levels were 
not analyzed for cost curves. (Hoshizaki, No. 124 at p. 1)
    As discussed above in section IV.D.1, DOE's analysis for the RCU 
class was at a representative capacity of 800 lb ice/24 hours, intended 
to provide representation for both small and large classes, by being at 
a capacity level in the large range but within 100 lb ice/24 hours of 
the small range. Continuous ice maker data that DOE collected from 
publicly available sources does show that nearly all ice makers meet 
the baseline efficiency levels considered in the analysis. Not all meet 
the efficiency levels eventually designated as TSL 3 for the final 
rule, but some ice makers over a broad capacity range in each of the 
cited classes (SCU-A-C, IMH-W-C, RCU-RC-C, and RCU-NRC-C) do meet this 
level, shown in Table IV.12 through Table IV.15. A comparison of the 
levels achieved by commercially available ice makers with the 
considered TSL levels is shown graphically in Chapter 3 of the TSD.

                                Table IV.12--Air-Cooled, Self-Contained, Continuous Units Meeting the Final Rule Standard
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                Adjusted energy
               Manufacturer                             Model              Harvest capacity    use  (kWh/100 lb   Standard  (kWh/100    Hardness factor
                                                                           (lb ice/24 hours)         ice)               lb ice)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Hoshizaki.................................  F-330BAH-C..................                 222                7.99                8.08                84.5
Hoshizaki.................................  F-330BAH....................                 238                7.56                7.98                69.8
Manitowoc.................................  RNS0385A-161................                 248                7.75                7.92                  86
Scotsman..................................  MDT5N25WS-1#................                 455                4.99                6.63                  75
Hoshizaki.................................  DCM-751BWH..................                 631                5.21                5.53                88.9
--------------------------------------------------------------------------------------------------------------------------------------------------------

[[Page 4680]]

                              Table IV.13--Water-Cooled, Ice Making Head, Continuous Units Meeting the Final Rule Standard
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                Adjusted energy
               Manufacturer                             Model              Harvest capacity    use  (kWh/100 lb   Standard  (kWh/100    Hardness factor
                                                                           (lb ice/24 hours)         ice)               lb ice)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Ice-O-Matic...............................  GEM0450W....................                 429                4.66                5.33                 (*)
Follet....................................  HC *700W **.................                 535                4.43                5.05                 (*)
Ice-O-Matic...............................  GEM0655W....................                 578                 4.2                4.94                 (*)
Ice-O-Matic...............................  MFI0805W....................                 604                4.26                4.87                 (*)
Hoshizaki.................................  F-801MWH....................                 635                4.48                4.78                75.1
Ice-O-Matic...............................  GEM0650W....................                 633                3.86                4.79                 (*)
Ice-O-Matic...............................  MFI0800W....................                 740                3.93                4.50                 (*)
Ice-O-Matic...............................  GEM0956W....................                 877                3.54                4.34                 (*)
Ice-O-Matic...............................  GEM0955W....................                 927                3.71                4.34                 (*)
Ice-O-Matic...............................  MFI1256W....................                 959                3.54                4.34                 (*)
Ice-O-Matic...............................  MFI1255W....................                1000                3.41                4.34                 (*)
Follet....................................  HCE1400W**..................                1150                4.31                4.34                 (*)
Ice-O-Matic...............................  RN-1409W....................                1318                4.27                4.34                 (*)
Ice-O-Matic...............................  RN1409W-261.................                1318                4.15                4.34                  88
Follet....................................  HCC1400W ***................                1374                4.28                4.34                 (*)
--------------------------------------------------------------------------------------------------------------------------------------------------------
* Ice hardness factor assumed to be 70 for flake ice makers and 85 for nugget ice makers.

                         Table IV.14--Remote Condensing, Not Remote Compressor, Continuous Units Meeting the Final Rule Standard
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                Adjusted energy
               Manufacturer                             Model              Harvest capacity    use  (kWh/100 lb    Proposed standard    Hardness factor
                                                                           (lb ice/24 hours)         ice)          (kWh/100 lb ice)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Ice-O-Matic...............................  GEM0650R....................                 550                6.41                6.51                 (*)
Ice-O-Matic...............................  GEM0956R....................                 825                4.77               4.915                 (*)
Ice-O-Matic...............................  MFI1256R....................                 950                4.79                5.06                 (*)
Scotsman..................................  N1322R-32#..................                1030                5.04                5.06                  74
Scotsman..................................  F1222R-32#..................                1050                4.97                5.06                  60
--------------------------------------------------------------------------------------------------------------------------------------------------------
* Ice hardness factor assumed to be 70 for flake ice makers and 85 for nugget ice makers.

                           Table IV.15--Remote Condensing, Remote Compressor, Continuous Units Meeting the Final Rule Standard
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                Adjusted energy
               Manufacturer                             Model              Harvest capacity    use  (kWh/100 lb   Standard  (kWh/100    Hardness factor
                                                                           (lb ice/24 hours)         ice)               lb ice)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Follet....................................  HCD700RBT...................                 566                5.44                6.62                  88
Manitowoc.................................  RFS1278C-261................                 958                5.11                5.26                  72
Follet....................................  HCD1400R ***................                1184                4.87                5.26                 (*)
Follet....................................  HCF1400RBT..................                1195                4.59                5.26                89.4
Follet....................................  HCD1650R ***................                1284                5.24                5.26                 (*)
Follet....................................  HCF1650RBT..................                1441                4.14                5.26                89.9
Manitowoc.................................  RFS2378C-261................                1702                5.18                5.26                  68
Ice-O-Matic...............................  MFI2406LS...................                2000                4.27                5.26                 (*)
Scotsman..................................  FME2404RLS..................                2000                3.54                5.26                 (*)
--------------------------------------------------------------------------------------------------------------------------------------------------------
* Ice hardness factor assumed to be 70 for flake ice makers and 85 for nugget ice makers.

c. IMH-A-Large-B Treatment
    The existing DOE energy conservation standard for large air-cooled 
IMH cube type ice makers is represented by an equation for which 
maximum allowable energy usage decreases linearly as harvest rate 
increases from 450 to 2,500 lb ice/24 hours. In the NOPR, DOE proposed 
efficiency levels for this class that maintain a constant energy use in 
kwh per 100 pounds of ice at large capacities to the extent that this 
approach does not violate EPCA's anti-backsliding provision. 79 FR at 
14877 (March 17, 2014).
    DOE did not receive any comments on the approach described in the 
NOPR. Therefore, DOE maintained this approach for the final rule.
d. Maximum Available Efficiency Equipment
    DOE considered the most-efficient equipment available on the 
market, known as maximum available equipment. For many batch equipment 
classes, the maximum available equipment uses proprietary or screened-
out technology options that DOE did not consider in its engineering 
analysis, such as low thermal-mass evaporators and tube evaporators for 
batch type ice makers. Hence, DOE considered only batch maximum 
available equipment that does not include these technologies. These 
maximum available efficiency levels are shown in Table IV.16. This 
information is based on DOE's icemaker ratings database (see data in 
chapter 3 of the final rule TSD). The efficiency levels are represented 
as an energy use percentage reduction compared to the energy use of 
baseline-efficiency equipment. For some batch equipment classes, DOE 
has presented maximum available efficiency levels at different capacity 
levels or for 22-inch wide ice makers.

[[Page 4681]]

 Table IV.16--Efficiency Levels for Maximum Available Equipment Without
       Screened Technologies in Batch Ice Maker Equipment Classes
------------------------------------------------------------------------
            Equipment class               Energy use lower than baseline
------------------------------------------------------------------------
IMH-W-Small-B..........................  19.2%, 16.9% (22-inch wide).
IMH-W-Med-B............................  14.3%.
IMH-W-Large-B..........................  5% (at 1,500 lb ice/24 hours),
                                          2.5% (at 2,600 lb ice/24
                                          hours).
IMH-A-Small-B..........................  19.3%, 16.6% (22-inch wide).
IMH-A-Large-B..........................  16.1% (at 800 lb ice/24 hours)
                                          5.5% (at 590 lb ice/24 hours,
                                          22-inch wide) 6.0% (at 1,500
                                          lb ice/24 hours).
RCU-Small-B............................  25.8%.
RCU-Large-B............................  15.7% (at 1,500 lb ice/24
                                          hours), 14.9% (at 2,400 lb ice/
                                          24 hours).
SCU-W-Small-B..........................  26.2%.
SCU-W-Large-B..........................  27.6%.
SCU-A-Small-B..........................  24.9%.
SCU-A-Large-B..........................  26.4%.
------------------------------------------------------------------------

    Efficiency levels for maximum available equipment in the continuous 
type ice-making equipment classes are shown in Table IV.17. This 
information is based on a survey of product databases and manufacturer 
Web sites (see data in chapter 3 of the final rule TSD). The efficiency 
levels are represented as an energy use percentage reduction compared 
to the energy use of baseline-efficiency equipment.

   Table IV.17--Efficiency Levels for Maximum Available Equipment for
               Continuous Type Ice Maker Equipment Classes
------------------------------------------------------------------------
            Equipment class               Energy use lower than baseline
------------------------------------------------------------------------
IMH-W-Small-C..........................  16.5%.
IMH-W-Large-C..........................  12.2% (at 1,000 lb ice/24
                                          hours), 8.6% (at 1,800 lb ice/
                                          24 hours).
IMH-A-Small-C..........................  28.0%.
IMH-A-Large-C..........................  35.7% (at 820 lb ice/24 hours),
                                          lb ice.
RCU-Small-C............................  18.4%.
RCU-Large-C............................  18.5%.
SCU-W-Small-C..........................  18.7% *.
SCU-W-Large-C..........................  No equipment on the market *.
SCU-A-Small-C..........................  29.3%.
SCU-A-Large-C..........................  No equipment on the market *.
------------------------------------------------------------------------
* DOE's inspection of currently available equipment revealed that there
  are no available products in the defined SCU-W-Large-C and SCU-A-Large-
  C equipment classes at this time.

    In response to the maximum available efficiency levels presented in 
the NODA AHRI suggested that DOE review the max available unit for the 
22-inch IMH-A-Small-B equipment class which is cited at 17% as they 
believe the unit may contain proprietary design options. (AHRI, No. 128 
at p. 3)
    DOE maintains that the representative 22-inch unit for the IMH-A-
Small-B equipment class did not contain any proprietary designs--
specifically, the model analyzed does not include any proprietary or 
screened options such as low-thermal-mass evaporators or tube-ice 
evaporators. Table IV.18 lists 22-inch ice makers of this class that 
are in DOE's ice maker database. DOE calculated an efficiency level 
equal to 12.3% for such a unit with design options included in maximum 
available equipment. There are three available units with higher 
efficiency level. Therefore, DOE has maintained the maximum available 
level for this equipment class in the final rule engineering analysis.

                                    Table IV.18--22-Inch IMH-A-Small-B Models
----------------------------------------------------------------------------------------------------------------
                                                                                           Contains  proprietary
                                                                                                or  screened
  Harvest capacity rate  (lb ice/24 hours)      Rated energy use      Percent efficiency     technology  (e.g.,
                                                (kWh/100 lb ice)            level           low-thermal-mass or
                                                                                            tube  evaporators)?
----------------------------------------------------------------------------------------------------------------
249........................................                   8.10                    0.2                    No.
290........................................                   7.23                    6.9                    No.
225........................................                   7.49                   10.0                    No.
335........................................                   6.64                   10.0                    No.
360........................................                   6.45                   10.0                    No.
310........................................                   6.80                   10.5                    No.
305........................................                   6.80                   11.0                    No.
230........................................                   7.32                   11.6                    No.
278........................................                   6.90                   12.3                   Yes.
214........................................                   7.20                   14.5                    No.
370........................................                   5.90                   16.6                    No.
255........................................                   6.60                   18.2                    No.
324........................................                   5.80                   22.4                   Yes.
----------------------------------------------------------------------------------------------------------------

e. Maximum Technologically Feasible Efficiency Levels
    When DOE adopts an amended or new energy conservation standard for 
a type or class of covered equipment such as automatic commercial ice 
makers, it determines the maximum improvement in energy efficiency that 
is technologically feasible for such equipment. (See 42 U.S.C. 
6295(p)(1) and 6313(d)(4)) DOE determined maximum technologically 
feasible (``max-tech'') efficiency levels for automatic commercial ice 
makers in the engineering analysis by considering efficiency 
improvement beyond the maximum available levels associated with two 
design options that are generally not used in commercially available 
equipment, brushless DC motors and drain water heat exchangers. DOE has 
not screened out these design options--cost-effectiveness is not one of 
the screening criteria (see section IV.C). Table IV.19 and Table IV.20 
show the max-tech levels determined in the NOPR engineering analysis 
for batch and continuous type automatic commercial ice makers, 
respectively. These max-tech levels do not consider use of screened 
technology, specifically low-thermal-mass evaporators and tube ice 
evaporators.

[[Page 4682]]

 Table IV.19--Final Rule Max-Tech Levels for Batch Automatic Commercial
                               Ice Makers
------------------------------------------------------------------------
                                          Percent energy use lower than
            Equipment type *                         baseline
------------------------------------------------------------------------
IMH-W-Small-B..........................  23.9%, 21.5% (22 inch wide).
IMH-W-Med-B............................  18.1%.
IMH-W-Large-B..........................  8.3% (at 1,500 lb ice/24
                                          hours), 7.4% (at 2,600 lb ice/
                                          24 hours).
IMH-A-Small-B..........................  25.5%, 18.1% (22 inch wide).
IMH-A-Large-B..........................  23.4% (at 800 lb ice/24 hours),
                                          15.8% (at 590 lb ice/24 hours,
                                          22 inch wide), 11.8% (at 1,500
                                          lb ice/24 hours).
RCU-Small-B............................  Not directly analyzed.
RCU-Large-B............................  17.3% (at 1,500 lb ice/24
                                          hours), 13.9% (at 2,400 lb ice/
                                          24 hours).
SCU-W-Small-B..........................  Not directly analyzed.
SCU-W-Large-B..........................  29.8%.
SCU-A-Small-B..........................  32.7%.
SCU-A-Large-B..........................  29.1%.
------------------------------------------------------------------------
* IMH is ice-making head; RCU is remote condensing unit; SCU is self-
  contained unit; W is water-cooled; A is air-cooled; Small refers to
  the lowest harvest category; Med refers to the Medium category (water-
  cooled IMH only); Large refers to the large size category; RCU units
  were modeled as one with line losses used to distinguish standards.
Note: For equipment classes that were not analyzed, DOE did not develop
  specific cost-efficiency curves but attributed the curve (and maximum
  technology point) from one of the analyzed equipment classes.

    Table IV.20--Final Rule Max-Tech Levels for Continuous Automatic
                          Commercial Ice Makers
------------------------------------------------------------------------
                                          Percent energy use lower than
             Equipment type                          baseline
------------------------------------------------------------------------
IMH-W-Small-C..........................  Not directly analyzed.
IMH-W-Large-C..........................  Not directly analyzed.
IMH-A-Small-C..........................  25.7% [dagger].
IMH-A-Large-C..........................  23.3% (at 820 lb ice/24 hours).
RCU-Small-C............................  26.6% [dagger].
RCU-Large-C............................  Not directly analyzed.
SCU-W-Small-C..........................  Not directly analyzed.
SCU-W-Large-C *........................  No units available.
SCU-A-Small-C..........................  26.6% [dagger].
SCU-A-Large-C *........................  No units available.
------------------------------------------------------------------------
* DOE's investigation of equipment on the market revealed that there are
  no existing products in either of these two equipment classes (as
  defined in this NOPR).
** For equipment classes that were not analyzed, DOE did not develop
  specific cost-efficiency curves but attributed the curve (and maximum
  technology point) from one of the analyzed equipment classes
[dagger] Percent energy use lower than baseline.

    Several stakeholders provided comment regarding the maximum 
technological efficiency levels presented in the NOPR.
    PG&E recommended that DOE continue to update its product database 
to ensure that max-tech levels are set appropriately. (PG&E and SDG&E, 
No. 89 at p. 3-4) Manitowoc stated that examples of currently available 
models that are near the max-tech levels are not generally 
representative of the full range of models in each equipment class, 
explaining that small-capacity ice makers can attain higher efficiency 
levels than large-capacity ice makers built using the same package 
size. (Manitowoc, No. 92 at p. 3) AHRI commented that the maximum 
technologically feasible efficiency levels presented in the NOPR 
analysis were overestimated by up to 13% for at least 10 equipment 
classes. AHRI added that the FREEZE energy model has been proven 
invalid through testing, citing two examples of testing to evaluate the 
efficiency improvement associated with switching to a higher-EER 
compressor in which the observed efficiency improvement was 
significantly less than the NOPR projections of efficiency improvement 
associated with compressor switching. (AHRI, No. 93 at p. 5-6)
    In response to the comment provided by PGE DOE notes that it has 
continued to update the product database with new data as it becomes 
available.
    In response to Manitowoc, DOE notes that its analysis has 
considered multiple capacity levels for key classes. Also, although DOE 
agrees that higher efficiency levels may be more difficult to attain by 
higher-capacity ice makers, DOE has investigated the trend of 
efficiency level as a function of harvest capacity and package size and 
concluded that there are no consistent trends in the available data 
that would indicate which capacities should be analyzed for each 
specific package size. 79 FR at 14871-3 (March 17, 2014). DOE notes 
that while Manitowoc's comment indicates that higher efficiency levels 
may be easier to attain for a smaller-capacity unit in a given package 
size, the comment does not indicate which classes and capacities in 
DOE's analysis represent capacities for which attaining higher 
efficiency would be so much easier that equipment with these 
characteristics would not be representative of their classes. An 
example review of the relationship of harvest capacity rate, efficiency 
level, and package size in volume (cubic feet) is shown in Table IV.21 
for IMH air-cooled batch ice makers. The data shown does not include 
ice makers with proprietary evaporator technology, nor does it include 
ice makers that produce large-size (gourmet) ice cubes. The data show 
that higher efficiency levels do not necessarily correlate either with 
larger package sizes or the smallest harvest capacity rates--the 
maximum 20.7% efficiency level is associated with a relatively small 
8.3 cubic foot volume and a 530 lb ice/24 hour capacity rate.

 Table IV.21--Relationship Between Harvest Capacity Rate, Efficiency Level, and Volume for IMH Air-Cooled Batch
                                 Ice Makers Between 300 and 600 lb Ice/24 Hours
----------------------------------------------------------------------------------------------------------------
                                                                    Energy use        Percent
             Harvest capacity rate (lb ice/24 hours)                (kWh/100 lb     efficiency    Volume (cu ft)
                                                                       ice)         level * (%)
----------------------------------------------------------------------------------------------------------------
305.............................................................            6.80            11.0             6.7
310.............................................................            6.80            10.5             6.7
335.............................................................            6.64            10.0             6.7
360.............................................................            6.45            10.0             6.7
370.............................................................            5.90            16.6             7.0
380.............................................................            6.70             4.2             7.0
404.............................................................            6.10            10.1             7.3
357.............................................................            6.30            12.4             8.3
358.............................................................            5.95            17.1             8.3
368.............................................................            6.10            14.0             8.3

[[Page 4683]]

 
448.............................................................            6.10             4.8             8.3
448.............................................................            6.10             4.8             8.3
530.............................................................            5.00            20.7             8.3
530.............................................................            5.00            20.7             8.3
366.............................................................            6.00            15.6             8.5
459.............................................................            5.80             9.2             8.5
590.............................................................            5.90             5.5             8.9
300.............................................................            6.20            19.3             9.1
316.............................................................            6.36            15.7             9.1
320.............................................................            6.20            17.4             9.1
335.............................................................            5.97            19.1             9.1
370.............................................................            5.94            16.1             9.1
388.............................................................            6.00            13.3             9.1
390.............................................................            5.79            16.2             9.1
405.............................................................            5.80            14.4             9.1
410.............................................................            5.73            14.9             9.1
485.............................................................            6.00             5.6             9.1
490.............................................................            5.41            14.8             9.1
538.............................................................            6.00             4.7             9.1
555.............................................................            5.29            15.8             9.1
300.............................................................            6.50            15.4             9.6
380.............................................................            5.80            17.0             9.6
400.............................................................            6.40             6.2             9.6
528.............................................................            6.00             4.9             9.6
486.............................................................            5.30            16.6            17.6
----------------------------------------------------------------------------------------------------------------
* Percent energy use less than baseline energy use.

    In response to AHRI, DOE notes that modifications have been made to 
the engineering analysis to incorporate new data provided by interested 
parties regarding the expected energy savings resulting from the 
incorporation of design options. These modifications have resulted in a 
reevaluation of max-tech levels for several equipment classes. See 
chapter 5 of the final rule TSD for the results of the analyses and a 
list of technologies included in max-tech equipment. Table IV.22 below 
compares the max-tech levels of AHRI's NOPR comment to DOE's NOPR phase 
max-tech levels, the maximum available efficiency levels, and the max-
tech levels of DOE's final rule analysis. The final-rule max-tech 
levels are higher than the AHRI max-tech levels in only three classes, 
IMH-W-Small-B, IMH-A-Small-B, and RCU-NRC-Large-B1 (1,500 lb ice/24 
hour representative capacity). AHRI's comment mentions that certain 
design options were removed from consideration as part of AHRI's 
``correction'' of the DOE analysis. These design option changes are 
described in Exhibit 3 of the comment. (AHRI, No. 93 at p. 24).
    For IMH-A-Small-B, AHRI eliminated ``increase in evaporator area by 
51% (with chassis growth)''. Efficiency improvement of 12.8 percent is 
attributed to this design option in the final rule analysis, accounting 
for more than the 7 percent difference between the DOE and AHRI max-
tech projections. For IMH-W-Small-B, AHRI similarly eliminated design 
options involving increase in chassis size. AHRI indicated that design 
options that increase package size should not be considered for these 
classes because they include 22-inch units, which AHRI claimed to be 
space-constrained. DOE retained consideration of these design options 
for the final rule analysis, conducting additional analysis for 22-inch 
wide models, and considering the installation cost impacts of the 
larger chassis size for a representative population of units where some 
rebuilding of the surrounding space would be required to accommodate 
the larger size (see section IV.G.2) DOE considers package size 
increase a potential for added cost, rather than a reduction in utility 
that must be screened out of the analysis, since added cost is not one 
of the four screening criteria. (see 10 CFR 430, subpart C, appendix A, 
section (4)(a)(4)) For RCU-NRC-Large-B1, DOE's final rule max-tech 
efficiency level is only 1 percent higher than the AHRI max-tech level, 
and the maximum available efficiency levels is equal to the AHRI max-
tech level. For this class, AHRI modified the performance improvement 
associated with higher-EER compressors. DOE's analysis uses ice maker 
efficiency improvement attributable to compressor improvement slightly 
better than assumed by AHRI--DOE's estimate is based on a larger 
dataset of test data, evaluating the ice maker efficiency improvement 
possible by using improved compressors.

                              Table IV.22--Comparison of AHRI Max Tech Levels With DOE NOPR and Final Rule Max Tech Levels
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                             Representative                      DOE NOPR max tech                       DOE final rule
                     Equipment class                       capacity  (lb ice/ AHRI max tech  (%       (% below      Max available  (%     max tech  (%
                                                               24 hours)       below baseline)       baseline)       below baseline)    below  baseline)
--------------------------------------------------------------------------------------------------------------------------------------------------------
IMH-W-Small-B............................................                300                 18                 29                 19                 24

[[Page 4684]]

 
IMH-W-Med-B..............................................                850                 18                 21                 14                 18
IMH-W-Large-B-1..........................................               1500                 15                 17                  5                  8
IMH-W-Large-B-2..........................................               2600                 14                 15                2.5                  7
IMH-A-Small-B............................................                300                 19                 31                 19                 26
IMH-A-Large-B-1..........................................                800                 25                 29                 16                 16
IMH-A-Large-B-2..........................................               1500                 18                 20                  6                 12
RCU-NRC-Large-B-1........................................               1500                 16                 21                 16                 17
RCU-NRC-Large-B-2........................................               2400                 18                 21                 15                 14
SCU-W-Large-B............................................                300                 30                 30                 28                 30
SCU-A-Small-B............................................                110                 39                 39                 31                 33
SCU-A-Large-B............................................                200                 35                 35                 26                 29
IMH-A-Small-C............................................                310                 26                 31                 28                 26
IMH-A-Large-C............................................                820                 30                 30                 36                 23
SCU-A-Small-C............................................                110                 28                 28                 24                 27
--------------------------------------------------------------------------------------------------------------------------------------------------------

    In response to AHRI's comment that the FREEZE model has been proven 
to be invalid, DOE notes that this comment is based on tests 
illustrating the ice maker efficiency improvement associated with two 
examples of switch to higher-EER compressors. AHRI points to only one 
of the design options considered in the DOE's analysis, for which DOE 
updated its analysis. DOE has modified its treatment of compressors in 
the analysis, basing the calculation of ice maker efficiency 
improvement on test data provided both by the AHRI comment and other 
data provided confidentially by manufacturers to DOE's contractor. 
Based on the data DOE reviewed, the ice maker energy use reduction 
associated with improvement in compressor EER averages 57 percent of 
the compressor energy use reduction expected based on the EER 
improvement--DOE used this ratio for its analysis of batch ice makers 
for the final rule. Hence, this particular issue with the engineering 
analysis has been addressed through changes in DOE's approach in both 
the NODA and final rule analyses.
3. Design Options
    After conducting the screening analysis and removing from 
consideration the technologies described above, DOE considered the 
inclusion of the remaining technologies as design options in the final 
rule engineering analysis. The technologies that were considered in the 
engineering analysis are listed in Table IV.23, with indication of the 
equipment classes to which they apply.
[GRAPHIC] [TIFF OMITTED] TR28JA15.003

a. Design Options That Need Cabinet Growth
    Some of the design options considered by DOE in its technology 
assessment could require an increased cabinet size. Examples of such 
design options include increasing the surface area of the evaporator or 
condenser, or both. Larger heat exchangers would enable the refrigerant 
circuit to operate with an increased evaporating temperature and a 
decreased

[[Page 4685]]

condensing temperature, thus reducing the temperature lift imposed on 
the refrigeration system and hence the compressor power input. In some 
cases the added refrigerant charge associated with increasing heat 
exchanger size could also necessitate the installation of a refrigerant 
receiver to ensure proper refrigerant charge management in all 
operating conditions for which the unit is designed, thus increasing 
the need for larger cabinet size.
    In the preliminary analysis, DOE did not consider design options 
that increase cabinet size. However, in the NOPR DOE changed the 
approach and considered design options that increase cabinet size for 
certain equipment classes: IMH-W-Small-B, IMH-A-Small-B, IMH-A-Large-B 
(800 lb ice/24 hours representative capacity), and IMH-A-Small-C. DOE 
only applied these design options for those equipment classes where the 
representative baseline unit had space to grow relative to the largest 
units on the market. DOE also considered size increase for the remote 
condensers of RCU classes.
    In response to the March 2014 NOPR, several manufacturers noted 
that the size of icemakers is limited in certain applications. 
Manitowoc commented that not all end users can accept larger or taller 
ice-making cabinets. (Manitowoc, Public Meeting Transcript, No. 70 at 
p. 133) Ice-O-Matic commented that customers want ice machines that are 
able to produce more ice in a smaller physical space and that such ice 
makers will be difficult to make if standards necessitate design 
options that require cabinet growth. (Ice-O-Matic, Public Meeting 
Transcript, No. 70 at p. 29-31)
    Scotsman and AHRI both noted that cabinet size increases would 
require users to either enlarge the space in the kitchen to accommodate 
a larger unit or to repair older ice makers rather than buying new ones 
or to make due with a smaller capacity ice maker. (AHRI, No. 93 at p. 
7-8; Scotsman, Public Meeting Transcript, No. 70 at p. 126-127) 
Manitowoc, Ice-O-Matic, and AHRI each stated that incorporating design 
options that may increase the size of automatic commercial ice makers 
will increase the likelihood that consumers refurbish rather than 
replace their existing units. (Manitowoc, Public Meeting Transcript, 
No. 70 at p. 129-130; Ice-O-Matic, Public Meeting Transcript, No. 70 at 
p. 32-33; AHRI, No. 93 at p. 7-8) Scotsman, Manitowoc and Follett all 
agreed that large ice makers would have an impact in installation 
costs. (Scotsman, No. 85 at p. 5b-6b; Manitowoc, No. 92 at p. 3; 
Follett, No. 84 at p. 6) Follett commented that maintenance costs will 
increase because larger components will reduce serviceability and 
energy-efficient components, such as a lower horsepower auger motor, 
may not be as robust. (Follet, No. 70 at p. 132-133)
    AHRI commented that design options which increase chassis size 
should not be considered for IMH-A-Small-B, IMH-A-Large-B, IMH-W-Small-
B, and IMH-W-Med-B classes, as 22-inch units wide units account for 18% 
of all ice makers sold in the US. AHRI added that if design options 
which increase cabinet size are not screened out for these product 
classes, there will likely be an adverse impact on product 
availability. (AHRI, No. 93 at p. 4)
    In contrast, PGE/SDG&E commented that they support DOE's decision 
to include in the engineering analysis design options that increase 
chassis size. (PG&E and SDG&E, No. 89 at p. 3) The Joint Commenters 
expressed their belief that DOE has appropriately considered size 
increases in their engineering analysis and that those customers who 
have smaller units today could purchase a taller unit with the same 
capacity, a smaller-capacity unit, or two smaller-capacity units. 
(Joint Commenters, No. 87 at p. 3)
    In response to the NODA analysis, CA IOU stated their support of 
DOE including technically (DOE interprets this to mean technologically) 
feasible design options that may increase chassis sizes in certain 
cases. (CA IOU, No. 129 at p. 2)
    DOE recognizes that the size of ice makers is limited in certain 
applications. DOE notes that many of the equipment classes analyzed do 
not require any cabinet growth to reach higher efficiency levels. DOE 
considered design options involving package size increase for IMH-A-
Large-B, IMH-A-Small-B, and IMH-W-Med units. For the final rule 
analyses, DOE did not consider design options which necessitate a 
cabinet size increase for IMH-A-Small-C units. DOE adjusted the 
analysis of installation costs to consider the impact of added costs 
associated with renovation to accommodate size increase for the few 
equipment classes for which DOE did consider size increase. The life 
cycle cost analysis, described in section IV.G.2 details how these 
added installation costs were considered in the analysis.
    Table IV.24 lists the equipment classes for which DOE considered 
design options that involve increase in chassis size in the final rule 
analysis.

    Table IV.24--Analyzed Equipment Classes Where DOE Analyzed Size-
          Increasing Design Options in the Final Rule Analysis
------------------------------------------------------------------------
                                 Harvest capacity   Used design options
             Unit                lb ice/24 hours    that increased size?
------------------------------------------------------------------------
IMH-A-Small-B.................                300  Yes.
IMH-A-Large-B (med)...........                800  Yes.
IMH-A-Large-B (large).........              1,500  No.
IMH-W-Small-B.................                300  Yes.
IMH-W-Med-B...................                850  No.
IMH-W-Large-B.................              2,600  No.
RCU-XXX-Large-B (med).........              1,500  For the remote
                                                    condenser, but not
                                                    for the ice-making
                                                    head.
RCU-XXX-Large-B (large).......              2,400  For the remote
                                                    condenser, but not
                                                    for the ice-making
                                                    head.
SCU-A-Small-B.................                110  No.
SCU-A-Large-B.................                200  No.
SCU-W-Large-B.................                300  No.
IMH-A-Small-C.................                310  No.
IMH-A-Large-C (med)...........                820  No.
SCU-A-Small-C.................                110  No.
------------------------------------------------------------------------
Note: ``XXX'' refers to ``RC'' or ``NRC'' for each of the entries with
  ``XXX''.

[[Page 4686]]

b. Improved Condenser Performance
    During the NOPR analysis, DOE considered size increase for the 
condenser to reduce condensing temperature and compressor power input. 
DOE requested comment on use of this design option and on the 
difficulty of implementing it in ice makers with size constraints.
    Follet commented that 10[emsp14][deg]F is the practical limit for 
the temperature difference between the ambient air and the hot gas in 
the condenser. Follet added that it is possible to increase the surface 
area, but either no meaningful efficiency is gained, or the size of the 
condenser would have to increase to the point that it would not fit 
into tight spaces. (Follet, No. 84 at p. 5)
    DOE did not consider any condenser sizes that would result in 
condensing temperatures as close as 10[emsp14][deg]F to the ambient 
temperatures for air-cooled icemakers.
    Stakeholders AHRI, Hoshizaki, Follet, and Ice-O-Matic noted that 
improved condenser performance would likely require an increase in 
cabinet size. (AHRI, No. 93 at p. 4; Hoshizaki, Public Meeting 
Transcript, No. 70 at p. 128-129; Ice-O-Matic, Public Meeting 
Transcript, No. 70 at p. 32-33; Follet, No. 84 at p. 5)
    In response to concerns about the potential need to increase 
cabinet size to make space for larger condensers, DOE agrees that 
increasing condenser size may require also increasing cabinet size. DOE 
has limited cabinet size increases to just three equipment classes, 
IMH-A-Large-B, IMH-A-Small-B, and IMH-W-Small-B. Furthermore, the 
specific size increases considered for these ice makers do not involve 
size increase beyond the size of ice makers that are currently being 
sold. The specific size increases considered are presented in Chapter 5 
of the TSD. In addition, the life cycle cost analysis considers 
additional installation cost associated with a proportion of ice makers 
sold as replacements that, with the new larger sizes, will not fit in 
the existing spaces where the old ice makers are located (see section 
IV.G.2.a).
    Manitowoc commented regarding condenser size increase for water-
cooled ice makers that increasing water-cooled surface area can reduce 
the condensing temperature and cause the ice machine to be unable to 
harvest the ice at low inlet water temperature conditions, which 
affects the performance of models in northern regions. (Manitowoc, 
Public Meeting Transcript, No. 70 at p. 108-110)
    DOE is aware that increasing condenser surface area may have an 
impact on the ice machine's ability to harvest ice. As discussed in the 
NOPR, DOE generally avoided consideration of very low condensing 
temperatures in its analysis, using 101[emsp14][deg]F as a guideline 
lower limit. The analysis also considered the increase in harvest cycle 
energy use--Section IV.D.4 describes how the longer harvest times were 
addressed in the engineering analysis.
    Manitowoc noted that the NODA EL3 level for the RCU-NRC-B2 
equipment class assumes a 19-inch increase in condenser width with an 
additional condenser row. Manitowoc asserted that an increase this 
large could lead to significant refrigerant charge issues. Therefore, 
Manitowoc suggested that NODA EL2 be selected for this equipment class. 
(Manitowoc, No. 126 at p. 2)
    In the final rule DOE modified the engineering analysis for this 
class and has eliminated one of the two condenser size increase steps 
in the final rule engineering analysis. DOE notes that the final 
condenser size is still smaller on the basis of refrigerant volume per 
harvest capacity rate than the largest remote condenser for an RCU ice 
maker observed in DOE's review of units purchased for reverse 
engineering. Therefore, DOE has confidence that the refrigerant 
management challenges are manageable for the maximum condenser size 
considered in the analysis.
    Manitowoc also noted that adding a condenser row in the SCU-A-
Small-B class may not be possible due to the small volume available in 
the compact chassis required for these models. Similarly, a 9'' 
increase in condenser width for the SCU-A-Large-B may be unrealistic. 
(Manitowoc, No. 126 at p. 2) In selecting these design options, DOE 
reviewed the spatial constraints and condenser sizes within both 
reverse-engineered units used as the basis for energy use calculations 
for these classes. While the space underneath the ice storage bins of 
these units is limited in height, there is sufficient room for the 
width and depth increases that DOE considered. Based on data gathered 
from these teardowns, DOE concluded that these condenser size design 
options were feasible for these units.
c. Compressors
    Several interested parties provided comment regarding the 
feasibility of incorporating more efficient compressors in ACIMs. AHRI 
urged DOE to reevaluate the feasibility of implementing more efficient 
compressors into the IMH-A-Small-C product class, which Follett has 
found are too small to fit larger compressors. (AHRI, No. 93 at p. 4) 
Follett also individually commented that they independently evaluated a 
more efficient compressor for IMH-A-Small-C and that its size made it 
infeasible given the restrictions of the Follett chassis. (Follet, No. 
84 at p. 8)
    In response to AHRI and Follet's assertion that higher efficiency 
compressors may not fit within the chassis of IMH-A-Small-C, DOE's 
analysis of this class was based on use of a Copeland RST45C1E-CAV 
compressor, which is no larger than the compressor used in the model 
upon which DOE based the analysis. Hence, DOE concluded that use of 
this higher-efficiency compressor would not require an increase in the 
package size. DOE notes that it did avoid consideration of the highest-
efficiency compressors for 22-inch wide classes when these compressors 
clearly are physically larger than the available space allows. In 
particular, DOE did not consider use of high-efficiency Bristol 
compressor in these cases, because Bristol compressors are generally 
larger than other available compressors.
    Several commenters, including AHRI, NEEA, Danfoss, and Ice-O-Matic 
each noted that the harvest process of automatic commercial ice makers 
needs to be considered when evaluating increased compressor efficiency 
as a design option. (AHRI, No. 93 at p. 4; NEEA, No. 91 at p.1; 
Danfoss, Public Meeting Transcript, No. 70 at p. 152-153; Ice-O-Matic, 
Public Meeting Transcript, No. 70 at p. 160-161) Danfoss and Ice-O-
Matic commented that ice machines differ significantly from other 
compressor-based applications in that, when harvesting ice, it is 
desirable to have a less efficient compressor because the waste heat 
helps harvest the ice. (Danfoss, Public Meeting Transcript, No. 70 at 
p. 152-153; Ice-O-Matic, Public Meeting Transcript, No. 70 at p. 160-
161)
    In response, DOE has adjusted its calculation of energy savings 
associated with improved compressor efficiency in the NODA and final 
rule analyses. Specifically, DOE considered all available data for 
tests involving compressor replacement for batch ice makers. This 
included the two examples provided in AHRI's NOPR comment. (AHRI, No. 
93 at pp. 25-30) It also included information provided confidentially 
to DOE's contractor. DOE reviewed the data to determine if it could be 
used to robustly predict any trends of ice maker performance impacts 
compared with compressor EER improvements that might vary as a function 
of key parameters such as ice maker class, capacity, compressor 
manufacturer, but no such trends were

[[Page 4687]]

evident. DOE used the data to develop an estimate of ice maker energy 
use reduction as a fraction of compressor energy use reduction--this 
value averaged 0.57 for the data set. DOE used this factor to calculate 
ice maker energy use reduction for all of the batch analyses for the 
NODA and final rule. Applying this approach significantly reduced the 
energy savings associated with improved-EER compressors for batch ice 
makers in the NODA and final rule analyses.
    Howe commented that variable-speed compressors are most effective 
at saving energy under part-load conditions, which is not taken into 
account in the DOE test procedure. Therefore, such components would be 
operating at or near maximum capacity during DOE tests, thus canceling 
their positive measurable benefit. (Howe, No. 88 at p. 1)
    In response to Howe's comment regarding variable speed compressors, 
DOE did not consider the use of variable-speed compressors in the 
analysis.
    Several interested parties submitted additional concerns about the 
feasibility of implementing design options involving increases in 
compressor efficiency. NAFEM commented that high-efficiency compressor 
motors for automatic commercial ice makers will not be available for 
the foreseeable future and that the investment required was not 
available for products with shipments as low as automatic commercial 
ice makers (150,000/year) and that DOE must account for their 
unavailability in its analysis. (NAFEM, No. 82 at p. 10)
    In response, DOE considered only compressors that are currently 
offered for use by compressor manufacturers. All of the compressors 
considered in the analysis are currently commercially available and are 
acceptable for use in ice makers as indicated by manufacturers in 
confidential discussions with DOE's contractor. Hence, DOE does not 
need to consider the development of new compressors with higher-
efficiency motors. The compressors considered in the analysis are 
listed in the compressor database. (Compressor Database, No. 135)
    In response to the NODA, Manitowoc noted that the RCU-NRC-B1 
equipment class assumes an increase in compressor EER of 20% which 
Manitowoc stated could not be achieved without resorting to radical 
design changes and possibly the use of permanent magnet motor 
technology. (Manitowoc, No. 126 at p. 3) Additionally, Manitowoc stated 
that for SCU-A-Small-B and SCU-Large-B, increases in compressor EER of 
40% and 25%, respectively, are unlikely to be achieved. (Manitowoc, No. 
126 at p. 2)
    For the RCU-NRC-Large-B-1 class, DOE based the analysis on a unit 
with a compressor having a rated EER of 7.16 Btu/Wh. In order to 
represent baseline performance, a less-efficient available compressor 
was used in the analysis. For the final rule, DOE modified its analysis 
to reflect a lower efficiency level for the unit which is the basis of 
the analysis. Hence, DOE has reduced the compressor EER improvement 
considered for this class from 20 percent to 10.7 percent.
    For the SCU-A-Small-B class, DOE based the analysis on an ice maker 
having a compressor with a rated EER of 3.3 Btu/Wh. The analysis 
considered use of an available compressor having a rated EER of 4.6 
Btu/Wh, a 39 percent improvement. Compressors having both these levels 
of EER exist, and hence the 39 percent improvement in EER from 3.3 to 
4.6 can be achieved.
    For the SCU-A-Large-B class, DOE based the analysis on an ice maker 
model having a compressor with a rated EER of 4.68 Btu/Wh. DOE modeled 
the baseline by considering a lower EER of 4.23 Btu/Wh. Compressors 
within the appropriate capacity range at this EER level do exist. The 
highest-EER considered for this analysis is 5.2 Btu/Wh, which is 
achieved by an available compressor of appropriate capacity--this 
represents 23 percent improvement in EER, slightly less than the cited 
25 percent. Compressors having both these levels of EER considered in 
the analysis exist, and hence the 23 percent improvement in EER from 
4.23 to 5.2 can be achieved.
    In response to the NODA analysis for equipment class SCU-A-Small-C, 
AHRI noted that DOE increased the ``percent energy use reduction'' from 
8.5% in the NOPR to 10.91% in the NODA for the same design option, 
``Changed compressor EER from 4.7 to 5.5''. AHRI requested that DOE 
provide justification for this change. (AHRI, No. 128 at p.3) In the 
NODA, DOE had calculated continuous ice maker percentage savings as 75% 
of the compressor energy savings (0.75 x (1-4.7/5.5) = 0.109), rather 
than using the results of the FREEZE model to represent the compressor 
energy savings. However, the ice maker upon which the SCU-A-Small-C 
analysis was based has a greater proportion of auger and fan energy use 
than typical continuous units. Hence, DOE agrees that an increase in 
the savings projection to 10.9% is unrealistic, and has changed the 
projection.
    For the final rule analysis, DOE also did not use the FREEZE model, 
and instead assumed that the compressor energy use reduction would be 
5% less than would be expected, based on the EER increase. The 
compressor energy use for the unit started at 72% of unit energy use, 
and the design options considered prior to consideration of the 
improved-EER compressor already reduced energy use to 90.7% of baseline 
energy use. Hence, DOE recalculated the savings for this design option 
as 0.95 x (1-4.7/5.5) x 0.72 x 0.907 = 0.09 = 9%.
d. Evaporator
    Follett commented that increasing the length or width of continuous 
type evaporators would increase cabinet size. (Follet, Public Meeting 
Transcript, No. 70 at p. 90-91) Follett also commented that increasing 
the height of the continuous type evaporator is not feasible because, 
in 75% of Follett's automatic commercial ice makers, the evaporator is 
horizontal. Therefore, any evaporator growth would increase the 
icemaker footprint so that it could no longer fit on standard beverage 
dispensers. (Follett, No. 84 at p. 5-6)
    DOE notes that it did not consider evaporator size increase as a 
design option for continuous ice makers in the final rule engineering 
analysis.
    In response to the NODA, AHRI noted that IMH-W-Small-C units 
typically use the same chassis as their IMH-A-Small-B counterparts and 
should also be considered as space constrained units. Specifically, 
AHRI recommended screening out the increased evaporator size for this 
product class on the basis that the chassis could not withstand the 
corresponding 4-inch increase in width. AHRI added that if evaporator 
size increase option is kept for IMH-W-Small-C units, a more realistic 
cost must be associated with this design option. (AHRI, No. 128 at p. 
2)
    In response to AHRI's comment, DOE notes that the typical use of 
the same cabinet as IMH-A-Small-B does not mean there is no possible 
cabinet size increase. Nevertheless DOE has eliminated this design 
option step from the analysis for the IMH-A-Small-C. The evaporator 
size increase was considered in the NOPR analysis in conjunction with a 
condenser size increase. In the final rule analysis, this step in the 
analysis now considers only the condenser size increase.
    AHRI stated in its NODA comments that an 18 percent size increase 
in evaporator area cannot reasonably be implemented in 22-inch IMH-A-
Small-B units. (AHRI, No. 128 at p. 2). DOE developed its 22-inch IMH-
A-Small-B analysis by removing from the 30-inch

[[Page 4688]]

chassis analysis for IMH-A-Small-B those design options that would not 
fit in a 22-inch chassis. The baseline evaporator used in the model 
upon which DOE based this analysis has a plate area that is relatively 
small. Hence, the 18 percent size increase can fit within the chassis 
of a 22-inch unit. In fact, the maximum-available 22-inch unit of this 
class has an evaporator that is somewhat larger than the largest 
evaporator size considered for the analysis. Hence, DOE concludes that 
it did not consider excessive increase in evaporator size for the 22-
inch IMH-A-Small-B analysis.
    In response to the NODA, Manitowoc stated that for IMH-A-Small-B 
units, a 51% increase in evaporator surface area is not always possible 
in the chassis sizes used in the industry and concluded that the max 
efficiency level that should be considered is EL3. (Manitowoc, No. 126 
at p. 1)
    DOE agrees that the design option mentioned by Manitowoc, a 51% 
increase in evaporator surface area for IMH-A-Small-B units would 
require a growth in cabinet size. Consequently, DOE considered such a 
growth in the engineering analysis. DOE notes that the NODA TSL 3 
efficiency level for this class, 18% less energy than baseline, can be 
achieved with an evaporator growth less than 51%--DOE estimates that 
this would require evaporator size growth of 38%.
    Manitowoc stated that the IMH-small class would likely require 
chassis growth to add evaporator area. (Manitowoc, No. 126 at p. 2). 
DOE assumes that this refers to the IMH-W-Small-B class and agrees that 
some increase in chassis size may be required to support increases in 
evaporator size. DOE notes that IMH-W-Small-B is one of the classes for 
which DOE considered increase in chassis size.
e. Interconnectedness of Automatic Commercial Ice Maker System
    Several commenters noted that the addition of a certain design 
option may necessitate an alteration in the remaining automatic 
commercial ice maker components. AHRI stated their concern with DOE's 
component analysis, noting that a change in one component impacts other 
components and therefore the entire price and efficiency of the entire 
automatic commercial ice maker system. (AHRI, No. 128 at p. 2) 
Similarly, Scotsman stated that the manufacture product cost increase 
estimates do not account for system impacts when components are 
changed. In most cases it is inaccurate to estimate product cost 
changes by specific component as changing any component within the 
refrigeration system will require changes to other components in order 
to optimize performance efficiency. (Scotsman, No. 125 at p. 2) 
Similarly, Howe commented that component efficiency increases are not 
additive and not necessarily proportional when used in combination. 
(Howe, No. 88 at p. 2)
    As explained in the NOPR, DOE had attempted to conduct an 
efficiency-level analysis rather than a design-option approach. 
However, the efficiency-level analysis did not produce consistent 
results, in some cases indicating that higher-efficiency units are less 
expensive. Therefore, DOE went forward with the design option approach 
and solicited comments from interested parties regarding the impact a 
specific design option may have on the entire system. DOE's contractor 
received some information regarding the potentially higher costs 
associated with change of some components, for which it may have 
underestimated overall cost increase in the NOPR phase--this 
information has been incorporated into the final rule analysis. 
However, absent more specific information regarding these interactions, 
DOE cannot speculate on other changes that may have been appropriate to 
address this issue.
    Manitowoc commented that putting a larger evaporator in an ice 
machine would increase refrigerant charge, thus necessitating an 
accumulator, or rendering a compressor unreliable during harvest. Such 
a change would also increase the mass of the evaporator, thus requiring 
more energy to heat it up and cool it back down. (Manitowoc, Public 
Meeting Transcript, No. 70 at p. 142-143)
    DOE has not considered evaporator sizes (on the basis of evaporator 
size per ice maker capacity in lb ice/24 hours) larger than those of 
ice makers on the market. DOE has not observed use of accumulators and 
hence concludes that the evaporator sizes considered would not require 
one. While Manitowoc commented in the NOPR public meeting on the 
potential for added harvest time or harvest energy use for larger 
evaporators, they did not provide details in written comments showing 
how this effect might impact savings associated with larger 
evaporators. DOE notes that a larger evaporator would operate with 
warmer evaporating temperature during the freeze cycle, and this effect 
would reduce the heat required to warm the evaporator during the 
harvest cycle. Without data to quantify this effect, DOE's analysis 
assumed that harvest energy use would scale proportionally with 
evaporator area. Hence, the increase in mass of the evaporator has been 
accounted for in the estimation of the energy use reduction associated 
with the design option.
    Follett commented that the evaporator, auger motor, and compressor 
must all be sized to balance one another and that these components 
cannot easily be swapped out for other off-the-shelf components. 
(Follett, No. 84 at p. 5) Follett noted that increasing evaporator 
diameter is not feasible because it will increase the required torque, 
necessitating a larger motor that will draw more power and negate any 
efficiency gains. (Follet, No. 84 at p. 6)
    DOE is no longer considering evaporator size increase as a design 
option for continuous ice makers. However, DOE notes that the 
engineering analysis has attempted to consider the interconnectedness 
of the system components wherever possible. For example, for air cooled 
condenser growth, fan power was increased to maintain a constant 
airflow through a larger condenser.
    Hoshizaki commented that there is a lot of trial and error involved 
in pairing compressors with condensers while maintaining machine 
reliability. (Hoshizaki, Public Meeting Transcript, No. 70 at p. 159-
160)
    DOE realizes that there may be trial and error when pairing 
components. DOE solicited feedback from manufactures regarding the 
appropriateness of the use of specific compressors in the analysis. DOE 
did not identify any specific limitations in compressor/condenser 
pairings that it considered in its analysis in any comments or in 
interviews with manufacturers.
4. Cost Assessment Methodology
    In this rulemaking, DOE has adopted a combined efficiency level, 
design option, and reverse engineering approaches to develop cost-
efficiency curves. To support this effort, DOE developed manufacturing 
cost models based heavily on reverse engineering of products to create 
a baseline MPC. DOE estimated the energy use of different design 
configurations using an energy model with input data based on reverse 
engineering, automatic commercial ice maker performance ratings, and 
test data. DOE combined the manufacturing cost and energy modeling to 
develop cost-efficiency curves for automatic commercial ice maker 
equipment based to the extent possible on baseline-efficiency equipment 
selected to represent their equipment classes (in some cases, analyses 
were based on equipment with efficiency levels higher than baseline). 
Next, DOE derived

[[Page 4689]]

manufacturer markups using publicly available automatic commercial ice 
maker industry financial data, in conjunction with manufacturer 
feedback. The markups were used to convert the MPC-based cost-
efficiency curves into Manufacturer Selling Price (MSP)-based curves.
    The engineering analyses are summarized in an ``Engineering 
Results'' spreadsheet, developed initially for the NOPR phase (NOPR 
Engineering Results Spreadsheet, No. 59). This document was modified 
for the NODA (Engineering Analysis Spreadsheet--NODA, No. 112) and 
subsequently for the final rule (Final Rule Engineering Analysis 
Spreadsheet, No. 134)
    Stakeholder comments regarding DOE's NOPR and NODA engineering 
analyses addressed the following broad areas:
    1. Estimated costs in many cases were lower than manufacturers' 
actual costs.
    2. Estimated efficiency benefits of many modeled design options 
were greater than the actual benefits, according to manufacturers' 
experience with equipment development.
    3. DOE should validate its energy use model based on comparison 
with actual equipment test data.
    These topics are addressed in greater detail in the sections below.
a. Manufacturing Cost
    In response to the manufacturer costs presented in the NOPR, 
several stakeholders indicated that the incremental costs presented in 
the NOPR were optimistic. Specifically, AHRI, Follet, Manitowoc, and 
Danfoss stated the belief that DOE underestimated the incremental costs 
of its proposed design options. (AHRI, No. 93 at p. 4; Follet, No. 84 
at p. 5; Danfoss, No. 72 at p. 3; Manitowoc, No. 98 at p. 1-2)
    Scotsman commented that their data on the efficiency and costs 
associated with compressor upgrade, BLDC motors, larger heat 
exchangers, and drain water heat exchangers do not match the 
assumptions used by DOE in its analysis. (Scotsman, No. 85 at p. 4b)
    Manitowoc commented that DOE significantly underestimates the cost 
associated with heat exchanger growth, higher compressor EER, and high-
efficiency fan and pump motors. (Manitowoc, No. 98 at p. 1-2) Manitowoc 
also noted that their costs were not consistent with those found in the 
TSD, particularly in cases involving evaporator or cabinet growth 
(Manitowoc, Public Meeting Transcript, No. 70 at p. 116-117)
    DOE has revised and updated its analysis based on data provided in 
comments and made available through non-disclosure agreements. These 
updates included changes in its approach to calculating the energy use 
associated with groups of design options, changes in inputs for 
calculations of energy use, and changes in calculated equipment 
manufacturing cost. Comments related to the manufacturing costs of 
specific design options are described in the sections below.
    NAFEM and Hoshizaki stated that the cost curves were not analyzed 
to demonstrate what can be achieved in five years. (NAFEM, No. 123 at 
p. 2; Hoshizaki, No. 123 at p. 1)
    In response to NAFEM and Hoshizaki's comment, DOE notes that the 
costs in the cost curves are intended to be representative of today's 
technology and current market prices.
Compressor Costs
    AHRI, Danfoss, and Hoshizaki stated that DOE's assumption that a 
10% compressor efficiency increase could be achieved for a 5% price 
increase is flawed. (AHRI, Public Meeting Transcript, No. 70 at p. 20-
21; Danfoss, No. 72 at p. 3; Hoshizaki, No. 86 at p. 9) AHRI and 
Danfoss stated that a more realistic assumption would be a 1-2% 
efficiency improvement for a 5% price increase. (Danfoss, No. 72 at p. 
3; AHRI, Public Meeting Transcript, No. 70 at p. 20-21) AHRI and NAFEM 
both requested that the relationship between cost and compressor EER 
should be corrected to reflect the approach adopted by the final CRE 
rulemaking. (AHRI, No. 93 at p. 15; NAFEM, No. 82 at p. 4-5) Follet 
also asserted that it is unrealistic to assume that the full efficiency 
gain of a more efficient compressor will be realized at the costs 
assumed by DOE in the NOPR. (Follet, No. 84 at p. 5) In response to the 
NODA, AHRI stated that there was no explanation as to why the 
compressor costs changed as compared to the NOPR. AHRI noted that the 
NODA compressor costs were still not consistent with the approach used 
in the CRE rulemaking. (AHRI, No. 128 at p. 2)
    DOE maintains its position that the cost-EER relationship used in 
the CRE rulemaking was based on future improvements over existing EER 
levels. For example, the CRE final rule indicates that ``manufacturers 
and consumers expressed concern over DOE's assumptions regarding the 
advances in compressor technology anticipated before the compliance 
date.'' 79 FR 17726, 17760 (March 28, 2014). Compressor suppliers and 
OEMs commented that, ``if a 10% compressor efficiency improvement were 
possible for a 5% cost increase, then it is most likely that 
manufacturers would have already adopted this technology''. Id. The 
statement implies that manufacturers have not adopted the technology. 
In the automatic commercial ice maker NOPR public meeting, Danfoss, a 
compressor supplier, commented, ``these are mature technologies. 
They've been around 50 or 60 years. If that sort of efficiency 
improvement could be made available, it would have . . . we would have 
already done it.'' The comments insinuate that DOE was contemplating 
use of a technology that is not available and that the compressor 
manufacturers have not used. For the automatic commercial ice maker 
analysis, DOE did not consider future technologies. Rather, it 
considered only compressor options that are currently being offered by 
compressor suppliers. In some cases, baseline ice makers are using 
compressors with relatively low efficiencies compared to the levels 
that are available. It is for these cases that DOE has been projecting 
the possibility of large potential for compressor efficiency 
improvements. DOE has requested compressor cost data that would allow 
evaluation of the relationship between actual prices paid by automatic 
commercial ice maker manufacturers for the compressors and the EER 
levels of the compressors, indicating that this data might be provided 
confidentially to DOE's contractor. However, sufficient cost data to 
allow a regression analysis to determine the efficiency-cost 
relationship has not been made available. Based on limited data 
supplied confidentially to DOE's contractor during the NOPR phase, DOE 
initially concluded that cost does not vary significantly with EER. In 
addition, DOE received some feedback during interviews with 
manufacturers that the 10% improvement for 5% cost relationship is 
reasonable. DOE at that time adopted this relationship in order to 
avoid projecting zero cost increase associated with EER increase.
    Nevertheless, DOE has modified its approach to calculating 
improvement in compressor efficiency to consider the stakeholders' 
comments. The analysis calculates the cost associated with compressor 
EER improvement in two ways and uses the higher of these costs. The 
first approach is the 10% improvement for 5% cost used in the NOPR 
analysis. The second approach applies the 5% cost associated with the

[[Page 4690]]

2% improvement that the commenters cited, which DOE applied to the 
analysis as if the last 2% of compressor efficiency improvement is 
future efficiency improvement that would cost the cited 5%. For 
example, if the compressor efficiency improvement is 10%, this approach 
treated the first 8% of efficiency improvement to be associated with 
currently available compressors with no cost differences, and the last 
2% (from 8% to 10% improvement) as being associated with future 
compressor improvement with a 5% cost premium.
    Follett disputed the NOPR engineering result that showed a 20% 
decrease in energy use at a cost of $61 for the IMH-A-Large-C class. 
Follet noted that at an incremental cost of $60, they tested a unit 
utilizing an ECM motor and a compressor with a 5% increase in 
efficiency, but were only able to achieve a 9% decrease in energy use. 
(Follet, No. 84 at p. 8) AHRI also noted this work, indicating that 
Follett experienced less than half the efficiency gain predicted by DOE 
in the NOPR when switching from an SPM to an ECM motor and using a 
compressor with a 5% higher EER. AHRI further noted that, while DOE's 
analysis considered a 24% improvement in compressor EER, the best 
compressor that Follett was able to find improved the EER only 5%. 
(AHRI, No. 93 at p. 4)
    DOE notes that these comments do not indicate the initial energy 
use of the tested unit, only that the 9 percent efficiency improvement 
was insufficient to attain the NOPR-proposed efficiency level. Further, 
the comments do not indicate the initial EER of the compressor used in 
the Follett product. Since the NOPR phase, DOE has adjusted both its 
energy modeling as well as its cost estimates, so as to mitigate this 
issue. Based on new data collected through the NODA and final rule 
phases, DOE has completed new cost efficiency curves, such that the MSP 
increase for the final rule analysis associated with a 20% decrease in 
energy use for the IMH-A-Large-C class is $488. The increase is so 
large because, for the final rule analysis, use of design options other 
than a permanent magnet gear motor to power the auger increase 
efficiency less than 20% (roughly 18%), and the estimated cost of the 
higher-efficiency auger motor is very high. While it is difficult to 
determine whether the analysis is fully consistent with Follett's test 
data, DOE believes that its revised analysis sufficiently addresses 
this issue (the cost per percent improvement for the analysis is now 
$24/% ($488/20%), whereas the cost per percent improvement for 
Follett's cited experience is $7/% ($60/9%)). DOE does note that this 
Follett example does show that continuous ice machines experience 
energy use reductions at least consistent with the compressor 
efficiency improvements--Follett did not indicate the reduction in 
motor input wattage when switching from the shaded pole to the ECM 
motor, but if the ice maker energy use reduction for the motor change 
was 5%, one would conclude that the energy use reduction for the 
compressor change was 4%, or 80% of the 5% improvement in compressor 
EER--this contrasts markedly with some of the information provided in 
stakeholder comments about the relationship between batch ice maker 
energy use and compressor EER improvement. (see, e.g., AHRI, No. 93 at 
pp. 25-30)
Evaporator Costs
    Hoshizaki and Manitowoc stated the DOE underestimated the cost of 
increasing the evaporator size in the NOPR analysis, for both batch and 
continuous ice makers. Specifically, regarding the 50% evaporator size 
increase considered for the IMH-A-Small-B analysis, Hoshizaki commented 
that a 50% increase in evaporator height would result in a 50% MPC 
increase. (Hoshizaki, No. 86 at p. 9) For this design option, DOE 
calculated a $48 cost increase to the initial evaporator cost of $88 in 
the NOPR analysis. Manitowoc stated that the cost presented in the NOPR 
for a 50% larger evaporator is half of what they would see as a 
manufacturer. Manitowoc noted that this is partially because they only 
make 4000-5000 models per year of a particular cabinet size and thus do 
not have as much purchasing power as an appliance manufacturer. 
(Manitowoc, Public Meeting Transcript, No. 70 at p. 171-174)
    In the NODA and final rule analyses, DOE adjusted the costs related 
to increasing the size of the evaporator. DOE received information from 
manufacturers through non-disclosure agreements regarding the expected 
costs associated with increasing the size of the evaporator and has 
adjusted the analysis to reflect the new data. DOE's MPC increase 
projection for the same evaporator size increase for the IMH-A-Small-B 
class is now $101.
    As noted in section IV.D.3.d, AHRI commented that a more realistic 
cost estimate is required for the evaporator increase design option for 
IMH-W-Small-C units as they often use the same chassis as their IMH-A-
Small counterparts. Specifically, AHRI stated that manufacturers have 
conservatively estimated that a 17% increase in evaporator size should 
be 117% percent of the original evaporator's cost. (AHRI, No. 128 at p. 
2) DOE believes this comment may apply to the IMH-A-Small-C class 
rather than IMH-W-Small-C, since the 17% evaporator growth was 
considered in the NOPR analysis for the air-cooled class. In the NOPR 
phase, DOE calculated an MPC increase of $153 for the evaporator size 
increase and a condenser size increase considered in the same step of 
the analysis. Seventeen percent of the $1,252 contribution to MPC of 
the initial evaporator is $213.
    DOE acknowledges that the 17% evaporator growth would require 
chassis size increase for the specific model upon which the IMH-A-
Small-C analysis is based, if implemented by increasing the length of 
the auger/evaporator. As noted previously, DOE modified the analysis 
and is no longer considering evaporator size increases as a design 
option for any continuous units, including IMH-W-Small-C.
    In response to the NODA analysis, Hoshizaki, AHRI, Manitowoc, and 
NAFEM stated that increasing the evaporator by 18% with no chassis 
growth is not possible for 22-inch IMH-A-Small-B machines. (Hoshizaki, 
No. 124 at p. 2; AHRI, No. 128 at p. 2; Manitowoc, No. 126 at p. 2; 
NAFEM, No. 123 at p. 2) Hoshizaki added that such a change would 
require tooling, panel changes, and kits to fit on the machine. 
Hoshizaki and NAFEM noted that these changes would cost more than the 
$34 stated in the NODA. (Hoshizaki, No. 124 at p. 2; NAFEM, No. 123 at 
p. 2)
    DOE reviewed the cabinet size of the representative 22-inch IMH-A-
Small-B unit and found that it had space for an 18% evaporator 
increase. DOE notes that the final size of the 18% larger evaporator 
considered in the analysis is still smaller than evaporators found in 
some 22-inch units of the same equipment class. Hence, DOE believes 
that an 18% growth in evaporator size is possible and has maintained 
this design option in the final rule.
Condenser Costs
    Commenting on the NODA analysis for the IMH-W-Small-B, Hoshizaki 
and NAFEM stated that increasing the water-cooled condenser length by 
48% would require a larger cost increase than $40 stated in the NODA. 
(Hoshizaki, No. 124 at p. 2; NAFEM, No. 123 at p. 2) Hoshizaki noted 
that they currently are using the largest condenser offered by their 
supplier, and increasing its size would necessitate a special design. 
(Hoshizaki, No. 124 at p. 2)

[[Page 4691]]

    In the NODA phase, DOE evaluated a 48% condenser size increase for 
the representative IMH-W-Small-B unit of 22-inch width--based on a 
review of typical coaxial water-cooled condenser offerings from typical 
suppliers of these units, DOE has concluded that this might be a non-
standard size water-cooled condenser. In the final rule analysis for 
this unit, DOE has adjusted its water-cooled condenser options to be 
more consistent with standard condenser sizes, based on review of 
commercially available components. Therefore, for the IMH-W-Small-B, 22 
inch wide unit, DOE adjusted the analysis to instead utilize a 59% 
larger condenser. The estimated MPC increase for this design option in 
the final rule analysis is $58.
    Regarding the NODA analysis for the IMH-A-Small-C, Hoshizaki stated 
that cost of increasing the evaporator area by 17% and the condenser 
height by 4 inches would be much higher than the $150 presented in the 
NODA. Hoshizaki added that 22-inch wide machines could not accommodate 
4 inches of height growth and would require a change in chassis. 
Hoshizaki noted that condensers are standard parts from the catalogs of 
suppliers and there are no condensers that would match this change. 
(Hoshizaki, No. 124 at p. 2)
    DOE is no longer considering evaporator growth for continuous 
units. The representative unit for this equipment class has a condenser 
with core height of 10 inches, width of 12 inches and a depth of 3 
inches. The chassis height is 21\7/8\ inches and the chassis width is 
22 inches. The representative unit has space for the condenser size 
increases considered in the analysis. Based on discussions with 
manufacturers and heat exchanger suppliers, DOE has found that there is 
flexibility in the design of air-cooled condensers, as long as the 
design conforms to the use of standard tube pitch (distances between 
the tubes) patterns, fin style, and fin densities. The analysis 
considered no change in these design parameters that would make the 
condenser a non-standard design.
    In response to the NODA analysis for the SCU-W-Large-B class, AHRI 
commented on the changes in condenser size and the associated 
efficiency improvement as compared to the NOPR analysis. AHRI noted 
that in the NOPR analysis, DOE considered a size increase of 39%, which 
was estimated to reduce energy us use 11.2%, while in the NODA a 
condenser size increase of 112% led to estimated energy savings of 
16.7%. AHRI stated that such an increase in condenser size would cause 
issues with performance outside of rating conditions due to the large 
increase in refrigerant charge. AHRI recommended that DOE reconsider 
this design option. (AHRI, No. 128 at p. 3)
    In response, DOE modified the analysis for the SCU-W-Large-B for 
the final rule analysis, in which DOE considers a condenser size 
increase of 50%, with associated energy savings of 5.5%.
Purchasing Power and Component Costs
    Several commenters noted that the scale of the ice maker industry 
is too small to qualify for the price discounts seen by the appliance 
markets on specialized parts. (Hoshizaki, No. 86 at p. 7-8; Danfoss, 
Public Meeting Transcript, No. 70 at p. 175-176) Danfoss stated that 
the small scale of the industry is a barrier to implementing new 
technologies and that the investment necessary to produce high-
efficiency compressors in these volumes is not feasible in the 
foreseeable future. (Danfoss, No. 72 at p. 3-4)
    Scotsman commented that their vendors provide ECM motors at 200-
300% over the cost of baseline motors and high-efficiency compressors 
at up to 30% over the cost of baseline compressors. Scotsman added that 
they have not successfully proven the performance and reliability of 
such components in different applications. (Scotsman, No. 85 at p. 2)
    Joint Commenters urged DOE to determine whether fan, pump, and 
auger motors use ``off-the-shelf'' or custom motors if the former, this 
would suggest that permanent magnet motor availability should not be a 
concern. (Joint Commenters, No. 87 at p. 2-3)
    In response to these comments DOE notes that it considers the 
purchasing power of manufacturers in its estimation of component cost 
pricing. DOE has significantly revised its component cost estimates for 
the engineering analysis for the NODA and ultimately final rule phase 
based on additional information obtained in discussions with 
manufacturers as well as in stakeholder comments. DOE used the detailed 
feedback to update its cost estimates for all ice maker components.
b. Energy Consumption Model
    As part of the preliminary analysis, DOE worked with the developer 
of the FREEZE energy consumption model to adapt the model to updated 
correlations for refrigerant heat exchanger performance correlations 
and operation in a Windows computer environment. Analysis of ice maker 
performance during the preliminary analysis was primarily based on the 
model. During the course of the rulemaking, DOE has received numerous 
comments describing some of the shortcomings of the model. In response, 
DOE has modified its energy use analysis to rely less on the FREEZE 
model and more on direct calculation of energy use and energy 
reductions, based on test data and on assumptions about the efficiency 
of components such as motors. DOE requested that stakeholders provide 
information and data to guide the analysis, and also requested comments 
on the component efficiency assumptions. DOE received additional 
information through comments and confidential information exchange with 
DOE's contractor that helped guide adjustments to the analysis.
    After the NOPR and NODA publications, stakeholders continued to 
express concerns about the FREEZE model. AHRI questioned the accuracy 
of the FREEZE model. (AHRI, No. 93 at p. 5-6, 16) Scotsman noted that 
the FREEZE simulation program may not be able to model performance of 
automatic commercial ice makers upon revision of the EPA SNAP 
initiative, which may result in use of different refrigerants than are 
currently used in ice makers. (Scotsman, No. 125 at p. 2)
    Ice-O-Matic commented that the analysis is based on faulty 
assumptions from unrelated rulemakings such as commercial 
refrigeration, and that the cycles of ice machines do not resemble the 
cycles of commercial refrigeration products. (Ice-O-Matic, Public 
Meeting Transcript, No. 70 at p. 32) Scotsman and Manitowoc stated that 
the energy model may yield unrealistic efficiency gains for some of the 
design options. (Manitowoc, Public Meeting Transcript, No. 70 at p. 
154-156; Scotsman, No. 125 at p. 2). Specifically, Manitowoc noted that 
the energy use model significantly over-predicts the efficiency gains 
associated with design options, due to its inability to account for the 
harvest portion of the icemaking cycle. Manitowoc added that many 
design options that reduce freeze-cycle energy use increase harvest-
cycle energy use. (Manitowoc, No. 92 at p. 1; Manitowoc, No. 126 at p. 
1)
    Ice-O-Matic noted that that the FREEZE model was designed for full-
size ice cubes and does not work for half-size ice cube machines. (Ice-
O-Matic, No. 121 at p. 2) Full-size cubes of the ice maker models 
primarily considered in the analysis generally are cubes with 
dimensions \7/8\ x \7/8\ x \7/8\ inches. Half-size cubes have 
dimensions \7/8\ x \7/8\ x \3/8\ inches.
    Howe and Hoshizaki both stated that DOE should test its component 
design options in actual units in order to

[[Page 4692]]

validate the FREEZE model. (Howe, No. 88 at p. 2; Hoshizaki, No. 86 at 
p. 6) AHRI also expressed its concern that DOE has not conducted 
thorough testing to validate the efficiency gains associated with 
design options and requested that DOE prove the claims made in the 
engineering analysis. (AHRI, Public Meeting Transcript, No. 70 at p. 
20-21)
    DOE used the FREEZE energy model as a basis to estimate energy 
savings potential associated with design options in the early stages of 
the analysis when DOE had limited information. As more information was 
made available to DOE through public comments as well as non-disclosure 
agreements with manufacturers, DOE modified or replaced the results 
garnered from the FREEZE energy model to better reflect the new data 
collected.
    In response to Scotsman's comment regarding the FREEZE model's 
ability to model the performance of automatic commercial ice makers 
which use alternative refrigerants, DOE notes that, as described in 
section IV.A.4, it has not conducted analysis on the use of alternative 
refrigerants in this rule.
    In response to comments regarding the FREEZE model's ability to 
model the harvest cycle, DOE notes that while the FREEZE model does not 
simulate the harvest period analytically, the harvest energy is an 
input for the program that DOE adjusted consistent with test data. In 
short, the model's ability to accurately calculate the energy use 
associated with harvest is limited only by the availability of data 
showing the trends of harvest cycle energy use as different design 
options are considered. DOE requested information regarding this aspect 
of ice maker performance, received some information through comments 
and information exchange with manufacturers, and modified the energy 
use calculations accordingly.
    DOE notes that the harvest cycle energy use issue associated with 
the calculation of energy use for batch ice makers does not apply to 
continuous ice makers, which do not have a harvest cycle. DOE concludes 
that the inability to measure harvest cycle energy use cannot be a 
reason to question the energy use calculations made for continuous ice 
makers. DOE notes that stakeholders have not identified similar aspects 
of continuous ice maker operation that could potentially be cited as 
reasons for inaccuracies in the energy use calculations associated with 
these ice makers.
    In response to Ice-O-matic's comment regarding the FREEZE model's 
ability to model half cube ice machines, DOE notes that the FREEZE 
model is capable of modeling such units. However, as indicated in 
section IV.D.1 DOE has chosen to base the analysis on full-cube ice 
machines which, as explained in section IV.D.1, may have an efficiency 
disadvantage as compared to half- dice machines. Hence, focus on full-
cube ice makers makes the analysis more conservative.
Expected Savings for Specific Design Options
    Several commenters questioned the energy model's assumptions 
regarding the relationship between compressor EER improvement and ice 
maker efficiency improvement. AHRI stated that the assumed relationship 
should be verified with laboratory tests. (AHRI, No. 93 at p. 15)
    Manitowoc and Hoshizaki each stated that they tested a compressor 
with 12% higher EER compared to baseline and that it yielded a 3% 
efficiency improvement. (Manitowoc, Public Meeting Transcript, No. 70 
at p. 138-142; Hoshizaki, Public Meeting Transcript, No. 70 at p. 152) 
Ice-O-Matic commented that they tested a compressor with 10% higher EER 
and that it yielded only a 2% improvement in efficiency. Ice-O-Matic 
noted that this is due to the unique circumstances of the harvest 
cycle, which removes a lot of the improvements that are typically seen 
with compressor efficiency gains in other refrigeration equipment. 
(Ice-O-Matic, Public Meeting Transcript, No. 70 at p. 148-149) Follett 
noted that they observed a 9% efficiency gain with a compressor that 
was 5% more efficient and an ECM fan in an IMH-A-Large-C ice maker. 
Follett indicated that these design options would increase cost $60, a 
cost for which the DOE NOPR analysis predicted 20% improvement. 
(Follet, No. 84 at p. 8)
    AHRI stated that the FREEZE energy model results during the June 
19th public meeting did not support the findings DOE published in the 
NOPR when swapping an upgraded compressor. Rather the model simulation 
predicted that the unit with the upgraded compressor would produce more 
ice and consume more energy. AHRI stated that they submitted actual 
test data for this unit which showed modest efficiency savings for 
upgrading the compressor. AHRI noted that this finding is contradictory 
to the significant energy savings DOE claimed would be possible in the 
NOPR. (AHRI, No. 128 at p. 6-7) DOE responds that accurate modeling 
with any analysis requires careful validation of the input data and 
that no conclusions can be drawn regarding the results that emerged 
during the meeting because there was no time to ensure consistency of 
the input and to review the output to understand whether there was a 
valid reason for any unexpected results. One could argue, contrary to 
the AHRI position, that the results showed that the FREEZE model 
predicts higher energy use than would actually be consumed--DOE 
realizes that such a conclusion would be meaningless. The only real 
conclusion is that the program is not easy to operate and requires 
careful review of both input and output in order to ensure that results 
are meaningful.
    To address the stakeholder concerns that the FREEZE model cannot 
adequately model the effects of increased compressor efficiency on ACIM 
energy consumption, DOE modified the outputs of the energy model based 
on data received in the comments as well as from manufacturers under 
non-disclosure agreements. DOE also performed testing on several ice-
making units and used the test data to further inform the relationship 
between increased compressor efficiency and ACIM efficiency.
Operating Conditions
    NAFEM, Emerson, Manitowoc, Scotsman commented that DOE's 
engineering analysis is flawed because it only examines compressor 
ratings at AHRI conditions, rather than over the wide range of 
operating conditions experienced by ACIMs in the field. (NAFEM, No. 82 
at p. 10, Emerson, Public Meeting Transcript, No. 70 at p. 144; 
Manitowoc, Public Meeting Transcript, No. 70 at p. 144-146; Scotsman, 
No. 85 at p. 2) Emerson noted that the AHRI rating point for 
compressors is not typically where an ice machine operates which may 
contribute to the issues with DOE's modeling. (Emerson, Public Meeting 
Transcript, No. 70 at p. 144) Manitowoc stated that they typically use 
a 10-105 condition for compressors, whereas the cost curves used a 15/
95 condition,\29\ which does not match operating conditions that occur 
in ice machines. Manitowoc also noted that the

[[Page 4693]]

compressor maps cannot model what happens during the harvest event or 
the pre-chill time and that the coefficient models do not include these 
operating regions. (Manitowoc, Public Meeting Transcript, No. 70 at p. 
144-146) Danfloss also stated that compressor maps are not useful in 
developing assumptions about ice maker compressor performance. 
(Danfoss, Public Meeting Transcript, No. 70 at p. 152-153)
---------------------------------------------------------------------------

    \29\ Compressor performance depends on suction (inlet) and 
discharge (outlet) pressures. These pressures are often represented 
as the saturated refrigerant temperatures that correspond to the 
pressures. For the 15/95 conditions, the saturated evaporator 
temperature is 15[emsp14][deg]F and the saturated condensing 
temperature is 95[emsp14][deg]F (to be technically correct, these 
are represented as dew point temperatures for the refrigerant in 
question, R-404A--because there is a range of temperatures at a 
given pressure over which the refrigerant can coexist in equilibrium 
in both liquid and vapor phases, the temperature at the high end of 
this range often used).
---------------------------------------------------------------------------

    AHRI noted that DOE did not take operation changes into account, 
such as different batch times or energy use, when upgrading to a more 
efficient compressor. (AHRI, No. 128 at p. 2)
    In response to the comment that compressors operate under a wide 
range of conditions in the field, DOE requested information that could 
be used to guide the analysis with respect in regards to what 
compressors are not suitable for use in ice makers, and/or what other 
guidelines could be used to avoid consideration of ice maker designs 
that are not viable in the field. DOE did not receive from stakeholders 
specific guidelines that could be used to limit the degree to which a 
design option might be applied for a given ice maker model in its 
analysis. In response to Emerson's comment about compressor rating 
conditions not being the typical operating conditions during ice maker 
testing, DOE notes that the calculation of compressor performance 
during the test was done at more typical compressor operating 
conditions during ice maker testing, based on the full set of 
performance data for the compressor--not at the compressor rating 
conditions. In response to the comment regarding the 15/95 conditions 
associated with the cost curves, the performance calculations for the 
compressors had nothing to do with the 15/95 conditions--the 15/95 
conditions were simply an intermediate step in assigning a 
representative cost for a given compressor. This assignment of cost 
involved converting the rated AHRI 20/120 capacity for the compressor 
into a 15/95 condition by multiplying the capacity by 1.29. DOE then 
used this result as described in Chapter 5 of the TSD to determine an 
initial nominal cost using the relationship described in the TSD. DOE 
further increased the cost based on feedback obtained about compressor 
costs from manufacturers throughout the rulemaking.
    DOE received data showing the trends in ice maker energy use 
reduction with improved compressor EER, including data received as part 
of the AHRI NOPR comment, as well as additional data received by DOE's 
contractor under non-disclosure agreement. The data showed that for 
batch ice makers, the ice maker energy use reduction is a fraction of 
the expected energy use reduction when considering just the compressor 
EER improvement. DOE applied this reduction in efficiency improvement 
to its NODA and final rule analyses.
Analysis Calibration
    DOE calibrated the engineering analysis by comparing the energy use 
predictions associated with given sets of design options with energy 
usage and design data collected from existing ice maker models. DOE 
revisited these calibrations in the final rule phase. In general, DOE's 
analysis for a given ice maker class is based on an existing ice maker 
model with an efficiency level at or near baseline. Hence, the analysis 
is calibrated to this particular ice maker model at its efficiency 
level, which is based on either its rating or a combination of its 
rating and the results of DOE testing. The analysis considers the 
energy use impact of adding design options to improve efficiency. In 
order to represent the baseline, the analysis may consider removing a 
design option (or more than one if necessary) to allow representation 
of a design that is at the baseline efficiency level.
    DOE also calibrated its analysis using units at maximum available 
efficiency levels (or in some cases, efficiency levels less than the 
maximum available), specifically equipment without proprietary 
technologies, such as low-thermal-mass or tube-type evaporators for 
batch ice makers. DOE chose design options to reach the maximum 
available efficiency levels of existing equipment. Importantly design 
options involving electronically commutate motors and drain water heat 
exchangers were excluded from calibration, as these were not considered 
to be commonly used in current ice makers. In some cases, the set of 
design options chosen to represent the maximum efficiency level matched 
the designs of the maximum available efficiency level equipment. In 
other cases, the designs did not match exactly, and the design of the 
DOE analysis may have had more improvement in one component, while the 
maximum available ice maker had more improvement in another component. 
In order to ensure that DOE was not underestimating the costs 
associated with the overall design improvements, DOE estimated the cost 
differential between changing the major components of the analyzed max 
efficiency unit to match those of the maximum available equipment. 
Major components considered in this estimate were the compressor, 
evaporator, condenser, and condenser fan. Table IV.25 shows this 
calibration, listing: The maximum efficiency reached by each directly 
analyzed equipment class, without considering ECM or drain water heat 
exchanger (DWHX) design options; the efficiency of the maximum 
available unit; and the cost difference associated with modifying the 
major components of to match those in the maximum available. A negative 
cost differential indicates that the DOE analysis predicted a higher 
cost at that efficiency level compared with the maximum available unit. 
The computed cost differentials are zero or negative in all but one 
case, showing that the DOE analysis does not underestimate the cost of 
reaching these higher efficiency levels. For the one case in which the 
differential is positive, $4 for the IMH-A-Small-B 22-Inch ice maker, 
the maximum available efficiency level is 5% higher than the level 
predicted by DOE's energy use analysis for a comparable set of design 
options. The calibration is presented in more detail in Chapter 5 of 
the TSD.

                                   Table IV.25--Maximum Available Calibration
----------------------------------------------------------------------------------------------------------------
                                                                   DOE Analysis       Maximum          Cost
                                                                      maximum        available     differential
                                                  Representative    efficiency      efficiency      moving from
                 Equipment class                   capacity  (lb     level  (%       level  (%      analyzed to
                                                   ice/24 hours)       below           below          maximum
                                                                     baseline)       baseline)    available  ($)
----------------------------------------------------------------------------------------------------------------
IMH-W-Small-B...................................             300            19.2            19.2             -29
IMH-W-Small-B (22-inch wide)....................             300            16.9            16.9             -34
IMH-A-Small-B...................................             300            19.3            19.3             -27
IMH-A-Small-B (22-inch wide)....................             300            11.6            16.6              +4

[[Page 4694]]

 
IMH-A-Large-B-Medium............................             800            16.1            16.1             -74
IMH-A-Large-B (22-inch wide)....................             590             5.5             5.5             -13
IMH-A-Large-B-Large.............................            1500             6.2             6.0            -130
IMH-W-Med-B.....................................             850            10.4            14.3            -240
IMH-W-Large-B-2.................................            2600             2.5             2.5               0
RCU-NRC-Large-B-Med.............................            1500            15.7            15.7             -62
RCU-NRC-Large-B-Large...........................            2400            14.9            14.9            -329
SCU-A-Small-B...................................             110            26.6            24.9             -61
SCU-A-Large-B...................................             200            23.5            26.4             -28
SCU-W-Large-B...................................             300            27.6            27.6               0
IMH-A-Small-C...................................             310            19.8            28.0             -30
IMH-A-Large-C...................................             820            17.0            35.7             -11
SCU-A-Small-C...................................             220            21.8            30.1             -62
RCU-NRC-Small-C.................................             610            17.9            18.4             -40
----------------------------------------------------------------------------------------------------------------

c. Revision of NOPR and NODA Engineering Analysis
    DOE developed the final engineering analysis by updating the NOPR 
and NODA analyses. This included making adjustments to the 
manufacturing cost model as described in section IV.D.4.a. It also 
included adjustments to energy modeling as described in section IV.D.4.
    DOE made several changes to the engineering analysis throughout the 
course of this rulemaking. Specifically, in response to the concerns 
raised by stakeholders, DOE adjusted its analysis to rely more on test 
data based on input received in manufacturers' public and confidential 
comments than on theoretically analysis. These changes included:
     Based on new data, DOE made changes to the energy use 
reductions associated with individual design options;
     Based on new cost data, DOE made changes to the costs 
associated with individual design options. Design options were changed 
as a result of new data obtained through non-disclosure agreements with 
DOE's engineering contractor and comments made during the NOPR comment 
period developing an approach based on test data to determine the 
condensing temperature reductions associated with use of larger water-
cooled condensers;
     Based on comments made during the NOPR period, DOE added 
additional cost-efficiency curves for 22-inch width units in the IMH-A-
Small-B, IMH-A-Large-B, and IMH-W-Small-B equipment classes, and an 
additional cost-efficiency curve for the RCU-Small-C equipment class.
    DOE calibrated the results of its calculations with maximum 
available ice makers that are available in the market and which do not 
incorporate proprietary technologies. This calibration at the maximum 
available levels shows that the costs DOE assigned to the maximum 
available level is generally higher than suggested by the compared 
maximum available equipment.
    DOE believes that these changes help ensure that analysis 
accurately reflect technology behavior in the market. Further details 
on the analyses are available in chapter 5 of the final rule TSD.

E. Markups Analysis

    DOE applies multipliers called ``markups'' to the manufacturer 
selling price (MSP) to calculate the customer purchase price of the 
analyzed equipment. These markups are in addition to the manufacturer 
markup (discussed in section IV.J.2.b) and are intended to reflect the 
cost and profit margins associated with the distribution and sales of 
the equipment between the manufacturer and customer. DOE identified 
three major distribution channels for automatic commercial ice makers, 
and markup values were calculated for each distribution channel based 
on industry financial data. Table IV.26 shows the three distribution 
channels and the percentage of the shipments each is assumed to 
reflect. The overall markup values were then calculated by weighted-
averaging the individual markups with market share values of the 
distribution channels. See chapter 6 of the TSD for more details on 
DOE's methodology for markups analysis.

             Table IV.26--Distribution Channel Market Shares
------------------------------------------------------------------------
    National account       Wholesaler channel:      Contractor channel:
 channel: Manufacturer       Manufacturer to        Contractor purchase
 direct to customer (1-  distributor to customer   from distributor for
         party)                 (2-party)         installation (3-party)
------------------------------------------------------------------------
                0%                      38%                      62%
------------------------------------------------------------------------

    In general, DOE has found that markup values vary over a wide range 
based on general economic outlook, manufacturer brand value, inventory 
levels, manufacturer rebates to distributors based on sales volume, 
newer versions of the same equipment model introduced into the market 
by the manufacturers, and availability of cheaper or more 
technologically advanced alternatives. Based on market data, DOE 
divided distributor costs into

[[Page 4695]]

(1) direct cost of equipment sales; (2) labor expenses; (3) occupancy 
expenses; (4) other operating expenses (such as depreciation, 
advertising, and insurance); and (5) profit. DOE assumed that, for 
higher efficiency equipment only, the ``other operating costs'' and 
``profit'' scale with MSP, while the remaining costs stay constant 
irrespective of equipment efficiency level. Thus, DOE applied a 
baseline markup through which all estimated distribution costs are 
collected as part of the total baseline equipment cost, and the 
baseline markups were applied as multipliers only to the baseline MSP. 
Incremental markups were applied as multipliers only to the MSP 
increments (of higher efficiency equipment compared to baseline) and 
not to the entire MSP. Taken together the two markups are consistent 
with economic behavior in a competitive market--the participants are 
only able to recover costs and a reasonable profit level.
    DOE received a number of comments regarding markups after the 
publication of the NOPR.
    In written comments, Manitowoc, Hoshizaki, NAFEM, Follett and AHRI 
commented that baseline and incremental markups should be equal, set at 
the level of the baseline markups. (Manitowoc, No. 92 at p. 2; 
Hoshizaki, No. 86 at p. 3; NAFEM, No. 82 at p. 5; Follett, No. 84 at p. 
6; and AHRI, No. 93 at p. 6-7)
    Some stakeholders at the NOPR public meeting commented that DOE 
should not use incremental markups for incremental equipment costs 
arising from the imposition of new standards and that DOE should 
instead use one set of markups, that corresponds to the baseline 
markups. Danfoss commented that wholesalers did not ask which part of 
prices were baseline and which were incremental. (Danfoss, Public 
Meeting Transcript, No. 70 at p. 197-198) Manitowoc stated that if they 
change list prices, their channel partners simply add a markup, and 
Manitowoc was not sure they would adopt another approach because a 
regulatory change drove up costs. (Manitowoc, Public Meeting 
Transcript, No. 70 at p. 192-193)
    Danfoss suggested DOE go back and review the results of earlier 
rulemakings and identify how markups worked in those equipment markets. 
Doing so could add some credibility to the DOE markups methodology, 
maybe not in time for the ACIM rulemaking but in time for later 
rulemakings. (Danfoss, Public Meeting Transcript, No. 70 at p. 195) 
AHRI agreed that DOE should go back and try to verify the numbers at 
some point, maybe not for this rulemaking but for the next one. (AHRI, 
Public Meeting Transcript, No. 70 at p. 199-200) NAFEM and Manitowoc 
also suggested validation studies. (NAFEM, Public Meeting Transcript, 
No. 70 at p. 198; Manitowoc, Public Meeting Transcript, No. 70 at p. 
190)
    ASAP stated that DOE implemented markups where every dollar spent 
got the same markup in rulemakings before the year 2000. ASAP argued 
that the real world does not work that way because businesses cover 
fixed costs in a certain fashion, and variable costs in a certain 
fashion. ASAP has done some work examining the question of how good 
DOE's methods are at predicting prices. ASAP found that DOE's predicted 
prices tend to be higher than they should be, based on retrospective 
analysis. ASAP welcomes more retrospective analysis but notes that such 
analysis won't help this docket. (ASAP, Public Meeting Transcript, No. 
70 at p. 195-197)
    Scotsman provided suggestions for price estimation services, and 
commented that the cumulative impact on the supply chain of training, 
store design modifications, maintenance, costs associated with passing 
along manufacturer adjusted pricing, and retrofit of existing locations 
would add significantly to the costs of the standards. (Scotsman, No. 
95 at page 5)
    DOE acknowledges that a detailed review of results following 
compliance with prior rulemakings could provide information on 
wholesaler and contractor pricing practices, and agrees that such 
results would not be timely for this rulemaking. In the absence of such 
information, DOE has concluded that its approach, which is consistent 
with expected business behavior in competitive markets, is reasonable 
to apply. If the cost of goods sold increases due to efficiency 
standards, DOE continues to assume that markups would decline slightly, 
leaving profit unchanged, and, thus, it uses lower markups on the 
incremental costs of higher-efficiency products. This approach is 
consistent with behavior in competitive markets wherein market 
participants are expected to be able to recover costs and reasonable 
levels of profit. If the markup remains constant while the cost of 
goods sold increases, as Manitowoc, Hoshizaki, NAFEM, Follett, and AHRI 
suggest, the wholesalers' profits would also increase. While this might 
happen in the short run, DOE believes that the wholesale market is 
sufficiently competitive that there would be pressure on margins. DOE 
recognizes that attempting to capture the market response to changing 
cost conditions is difficult. However, DOE's approach is consistent 
with the mainstream understanding of firm behavior in a competitive 
market.
    With respect to Manitowoc and Danfoss comments related to 
differential pricing based on efficiency improvements, DOE's approach 
for wholesaler markups does not imply that wholesalers differentiate 
markups based on the technologies inherently present in the equipment. 
Rather, it assumes that the average markup declines as the wholesalers' 
cost of goods sold increases due to the higher cost of more-efficient 
equipment for the reasons explained in the previous paragraph.
    With respect to Scotsman's comments, DOE reviewed the suggested 
price quote services and, while appreciative of the information, found 
them to not provide the type of information needed for estimating 
markups on a national or state average basis. As for the costs 
mentioned, DOE believes costs such as passing along the manufacturer 
pricing and personnel training are already embodied in markups as such 
costs would be included in the data used to estimate markups and no 
evidence has been entered into the record to demonstrate that the costs 
caused by the proposed standards would be extraordinary. Other costs 
such as building renovation and retrofit costs were included in 
installation costs, as appropriate.

F. Energy Use Analysis

    DOE estimated energy usage for use in the LCC and NIA models based 
on the kWh/100 lb ice and gal/100 lb ice values developed in the 
engineering analysis in combination with other assumptions. For the 
NOPR, DOE assumed that ice makers on average are used to produce one-
half of the ice the machines could produce (i.e., a 50 percent capacity 
factor). DOE also assumed that when not making ice, on average ice 
makers would draw 5 watts of power. DOE modeled condenser water usage 
as ``open-loop'' installations, or installations where water is used in 
the condenser one time (single pass) and released into the wastewater 
system.
    Hoshizaki asked about the basis for the 50 percent usage factor. 
(Hoshizaki, Public Meeting Transcript, No. 70 at p. 204) NEEA referred 
to the usage factor as a best estimate, and noted that the 50 percent 
factor had not been improved upon in response to earlier rulemaking 
stages. (NEEA, Public Meeting Transcript, No. 70 at p. 204-205)
    With its written comments, AHRI supplied monitored results 
collected by two manufacturers and recommended that DOE revise the 
utilization factor to 38%, based on the average of the data collected 
from stores, cafeterias, and

[[Page 4696]]

restaurants in a variety of states. (AHRI, No. 93 at p. 2-3) Follett 
commented that its data shows that ice makers run an average of 38% of 
the time and that DOE should modify its analysis accordingly. (Follett, 
No. 84 at p. 3) Manitowoc commented that a more accurate average duty 
cycle for ACIMs is 40% based on data it had collected. (Manitowoc, No. 
92 at p. 3)
    NEEA recommended that DOE adjust the energy use on a weighted sales 
average to reflect a higher duty cycle for ice makers that are 
replacements as compared to new units, where ice demand may not be 
accurately known. (NEEA, No. 91 at p. 2)
    Based on the monitored results submitted by AHRI and similar 
monitored results found in a report posted online,\30\ DOE utilized a 
42 percent capacity factor to estimate energy usage for the LCC and NIA 
models. With respect to NEEA's comment, given that DOE has no 
information on new versus replacement units and that the sample of 
monitored results does not include all relevant business types, DOE 
used the factor based on monitored results for new and replacement 
shipments for all business types.
---------------------------------------------------------------------------

    \30\ Karas, A. and D. Fisher. A Field Study to Characterize 
Water and Energy Use of Commercial Ice-Cube Machines and Quantify 
Saving Potential. December 2007. Fisher-Nickel, Inc. San Ramon, CA.
---------------------------------------------------------------------------

G. Life-Cycle Cost and Payback Period Analysis

    In response to the requirements of EPCA in (42 U.S.C. 
6295(o)(2)(B)(i) and 6313(d)(4)), DOE conducts a LCC and PBP analysis 
to evaluate the economic impacts of potential amended energy 
conservation standards on individual commercial customers--that is, 
buyers of the equipment. This section describes the analyses and the 
spreadsheet model DOE used. TSD chapter 8 details the model and all the 
inputs to the LCC and PBP analyses.
    LCC is defined as the total customer cost over the lifetime of the 
equipment, and consists of installed cost (purchase and installation 
costs) and operating costs (maintenance, repair, water,\31\ and energy 
costs). DOE discounts future operating costs to the time of purchase 
and sums them over the expected lifetime of the unit of equipment. PBP 
is defined as the estimated amount of time it takes customers to 
recover the higher installed costs of more-efficient equipment through 
savings in operating costs. DOE calculates the PBP by dividing the 
increase in installed costs by the savings in annual operating costs. 
DOE measures the changes in LCC and in PBP associated with a given 
energy and water use standard level relative to a base-case forecast of 
equipment energy and water use (or the ``baseline energy and water 
use''). The base-case forecast reflects the market in the absence of 
new or amended energy conservation standards.
---------------------------------------------------------------------------

    \31\ Water costs are the total of water and wastewater costs. 
Wastewater utilities tend to not meter customer wastewater flows, 
and base billings on water commodity billings. For this reason, 
water usage is used as the basis for both water and wastewater 
costs, and the two are aggregated in the LCC and PBP analysis.
---------------------------------------------------------------------------

    The installed cost of equipment to a customer is the sum of the 
equipment purchase price and installation costs. The purchase price 
includes MPC, to which a manufacturer markup (which is assumed to 
include at least a first level of outbound freight cost) is applied to 
obtain the MSP. This value is calculated as part of the engineering 
analysis (chapter 5 of the TSD). DOE then applies additional markups to 
the equipment to account for the costs associated with the distribution 
channels for the particular type of equipment (chapter 6 of the TSD). 
Installation costs are varied by state depending on the prevailing 
labor rates.
    Operating costs for automatic commercial ice makers are the sum of 
maintenance costs, repair costs, water, and energy costs. These costs 
are incurred over the life of the equipment and therefore are 
discounted to the base year (2018, which is the proposed effective date 
of the amended standards that will be established as part of this 
rulemaking). The sum of the installed cost and the operating cost, 
discounted to reflect the present value, is termed the life-cycle cost 
or LCC.
    Generally, customers incur higher installed costs when they 
purchase higher-efficiency equipment, and these cost increments will be 
partially or wholly offset by savings in the operating costs over the 
lifetime of the equipment. Usually, the savings in operating costs are 
due to savings in energy costs because higher-efficiency equipment uses 
less energy over the lifetime of the equipment. Often, the LCC of 
higher-efficiency equipment is lower compared to lower-efficiency 
equipment.
    The PBP of higher-efficiency equipment is obtained by dividing the 
increase in the installed cost by the decrease in annual operating 
cost. For this calculation, DOE uses the first-year operating cost 
decreases as the estimate of the decrease in operating cost, noting 
that some of the repair and maintenance costs used in the analysis are 
annualized estimates of costs. DOE calculates a PBP for each efficiency 
level of each equipment class. In addition to the energy costs 
(calculated using the electricity price forecast for the first year), 
the first-year operating costs also include annualized maintenance and 
repair costs.
    Apart from MSP, installation costs, and maintenance and repair 
costs, other important inputs for the LCC analysis are markups and 
sales tax, equipment energy consumption, electricity prices and future 
price trends, expected equipment lifetime, and discount rates.
    As part of the engineering analysis, design option levels were 
ordered based on increasing efficiency (decreased energy and water 
consumption) and increasing MSP values. DOE developed two to seven 
energy use levels for each equipment class, henceforth referred to as 
``efficiency levels,'' through the analysis of engineering design 
options. For all equipment classes, efficiency levels were set at 
specific intervals--e.g., 10 percent improvement over base energy 
usage, 15 percent improvement, 20 percent improvement. The max-tech 
efficiency level is the only exception. At the max-tech level, the 
efficiency improvement matched the specific levels identified in the 
engineering analysis.
    The base efficiency level (level 1) in each equipment class is the 
least efficient and the least expensive equipment in that class. The 
higher efficiency levels (level 2 and higher) exhibit progressive 
increases in efficiency and cost with the highest efficiency level 
corresponding to the max-tech level. LCC savings and PBP are calculated 
for each selected efficiency level of each equipment class.
    Many inputs for the LCC analysis are estimated from the best 
available data in the market, and in some cases the inputs are 
generally accepted values within the industry. In general, each input 
value has a range of values associated with it. While single 
representative values for each input may yield an output that is the 
most probable value for that output, such an analysis does not give the 
general range of values that can be attributed to a particular output 
value. Therefore, DOE carried out the LCC analysis in the form of Monte 
Carlo simulations \32\ in which certain inputs were expressed as a 
range of values and probability distributions that account

[[Page 4697]]

for the ranges of values that may be typically associated with the 
respective input values. The results or outputs of the LCC analysis are 
presented in the form of mean LCC savings, percentages of customers 
experiencing net savings, net cost and no impact in LCC, and median 
PBP. For each equipment class, 10,000 Monte Carlo simulations were 
carried out. The simulations were conducted using Microsoft Excel and 
Crystal Ball, a commercially available Excel add-in used to carry out 
Monte Carlo simulations.
---------------------------------------------------------------------------

    \32\ Monte Carlo simulation is, generally, a computerized 
mathematical technique that allows for computation of the outputs 
from a mathematical model based on multiple simulations using 
different input values. The input values are varied based on the 
uncertainties inherent to those inputs. The combination of the input 
values of different inputs is carried out in a random fashion to 
simulate the different probable input combinations. The outputs of 
the Monte Carlo simulations reflect the various probable outputs 
that are possible due to the uncertainties in the inputs.
---------------------------------------------------------------------------

    LCC savings and PBP are calculated by comparing the installed costs 
and LCC values of standards-case scenarios against those of base-case 
scenarios. The base-case scenario is the scenario in which equipment is 
assumed to be purchased by customers in the absence of the proposed 
energy conservation standards. Standards-case scenarios are scenarios 
in which equipment is assumed to be purchased by customers after the 
amended energy conservation standards, determined as part of the 
current rulemaking, go into effect. The number of standards-case 
scenarios for an equipment class is equal to one less than the total 
number of efficiency levels in that equipment class because each 
efficiency level above efficiency level 1 represents a potential 
amended standard. Usually, the equipment available in the market will 
have a distribution of efficiencies. Therefore, for both base-case and 
standards-case scenarios, in the LCC analysis, DOE assumed a 
distribution of efficiencies in the market, and the distribution was 
assumed to be spread across all efficiency levels in the LCC analysis 
(see TSD chapter 10).
    Recognizing that different types of businesses and industries that 
use automatic commercial ice makers face different energy prices and 
apply different discount rates to purchase decisions, DOE analyzed 
variability and uncertainty in the LCC and PBP results by performing 
the LCC and PBP calculations for seven types of businesses: (1) Health 
care; (2) lodging; (3) foodservice; (4) retail; (5) education; (6) food 
sales; and (7) offices. Different types of businesses face different 
energy prices and also exhibit differing discount rates that they apply 
to purchase decisions.
    Expected equipment lifetime is another input for which it is 
inappropriate to use a single value for each equipment class. 
Therefore, DOE assumed a distribution of equipment lifetimes that are 
defined by Weibull survival functions.\33\
---------------------------------------------------------------------------

    \33\ A Weibull survival function is a continuous probability 
distribution function that is commonly used to approximate the 
distribution of equipment lifetimes.
---------------------------------------------------------------------------

    Equipment lifetime is a key input for the LCC and PBP analysis. For 
automatic commercial ice maker equipment, there is a general consensus 
among industry stakeholders that the typical equipment lifetime is 
approximately 7 to 10 years with an average of 8.5 years. There was no 
data or comment to suggest that lifetimes are unique to each equipment 
class. Therefore, DOE assumed a distribution of equipment lifetimes 
that is defined by Weibull survival functions, with an average value of 
8.5 years.
    Using monitored data on the percentage of potential ice-making 
capacity that is actually used in real world installations (referred 
herein as utilization factor, but also referred to as duty cycle), the 
electricity and water usage of ice makers were also varied in the LCC 
analysis.
    Another factor influencing the LCC analysis is the physical 
location in which the automatic commercial ice maker is installed. 
Location is captured by using state-level inputs, including 
installation costs, water and energy prices, and sales tax (plus the 
associated distribution chain markups). At the national level, the 
spreadsheets explicitly modeled variability in the model inputs for 
water price, electricity price, and markups using probability 
distributions based on the relative populations in all states.
    Detailed descriptions of the methodology used for the LCC analysis, 
along with a discussion of inputs and results, are presented in chapter 
8 and appendices 8A and 8B of the TSD.
1. Equipment Cost
    To calculate customer equipment costs, DOE multiplied the MSPs 
developed in the engineering analysis by the distribution channel 
markups, described in section IV.E. DOE applied baseline markups to 
baseline MSPs and incremental markups to the MSP increments associated 
with higher efficiency levels.
    In the NOPR analysis, DOE developed a projection of price trends 
for automatic commercial ice maker equipment, indicating that based on 
historical price trends the MSP would be projected to decline by 0.4 
percent from the 2012 estimation of MSP values through the 2018 assumed 
start date of new or amended standards. The NOPR analysis also 
indicated an approximately 1.7 percent decline from the MSP values 
estimated in 2012 to the end of the 30-year NIA analysis period used in 
the NOPR.
    AHRI questioned where the price trend data came from and asked how 
confident DOE was of the numbers. (AHRI, Public Meeting Transcript, No. 
70 at p. 216) In written comments, AHRI expressed concern with the 
experiential learning analysis and use of a producer price index and 
urged DOE to assume the MSP remain constant. (AHRI, No. 93 at p. 16-17)
    PG&E and SDG&E expressed their support of DOE's use of experiential 
price learning in life-cycle cost analysis. (PG&E and SDG&E, No. 89 at 
p. 4)
    DOE acknowledges the PG&E and SDG&G comment. In response to the 
AHRI comments that the data do not support the price trends, DOE agrees 
that it would be better to have data very specific to automatic 
commercial ice maker price trends. However, such is not available. The 
PPI used in the analysis of price trends embodies the price trends of 
automatic commercial ice makers as well as related technologies, 
including those used as inputs to the manufacturing process. DOE would 
also note that a sensitivity analysis was performed with price trends 
held constant, and doing such would not have impacted the selection of 
efficiency levels for TSLs. (See appendix 10B of the final rule TSD.) 
Because DOE believes there is evidence that price learning exists, DOE 
continued to use price learning for the final rule.
    As is customary between phases of a rulemaking, DOE re-examined the 
data available and updated the price trend analysis. DOE continued to 
use a subset of the air-conditioning, refrigeration, and forced air 
heating equipment Producer Price Index (PPI) that includes only 
commercial refrigeration and related equipment, and excludes unrelated 
equipment. Using this PPI for the automatic commercial ice maker price 
trends analysis yields a price decline of roughly 2.4 percent over the 
period of 2013 (the year for which MSP was estimated) through 2047. For 
the LCC model, between 2013 and 2018, the price decline is 0.5 percent.
2. Installation, Maintenance, and Repair Costs
a. Installation Costs
    Installation cost includes labor, overhead, and any miscellaneous 
materials and parts needed to install the equipment. Most automatic 
commercial ice makers are installed in fairly standard configurations. 
For the NOPR,

[[Page 4698]]

DOE assumed that the installation costs vary from one equipment class 
to another, but not by efficiency level within an equipment class. For 
the NOPR, DOE tentatively concluded that the engineering design options 
did not impact the installation cost within an equipment class. DOE 
therefore assumed that the installation cost for automatic commercial 
ice makers did not vary among efficiency levels within an equipment 
class. Costs that do not vary with efficiency levels do not impact the 
LCC, PBP, or NIA results.
    During the public meeting manufacturers commented that not all 
customers can accommodate increased unit sizes, and that DOE must 
consider additional costs incurred from modifying facilities to 
accommodate ice makers with potential changes including plumbing and/or 
electrical work, relocating existing equipment, and/or building 
renovations. (Scotsman, Public Meeting Transcript, No. 70 at p. 126-
127; Manitowoc, Public Meeting Transcript, No. 70 at p. 133 and p. 209; 
Ice-O-Matic, Public Meeting Transcript, No. 70 at p. 208 and p. 210)
    In written comments, AHRI stated it was incorrect to assume 
installation cost would not increase with the efficiency improvement. 
(AHRI, No. 93 at p. 4) AHRI and Follett stated that larger ice makers 
will require installation space modification and would result in higher 
installation costs. (AHRI, No. 93 at p. 7-8; Follett, No. 84 at p. 6) 
Hoshizaki stated that the current installation cost range 
considerations may be correct for ice makers without size increases but 
agreed with AHRI and Follett that the installation cost would increase 
if the cabinet size went up, and that drain water heat exchangers would 
further increase installation costs. (Hoshizaki, No. 86 at p. 3-4) 
Manitowoc provided written comments, adding that remote condenser and 
remote condenser with compressor units that have larger condenser coils 
will require larger roof curbs or stronger mounting, depending on 
whether footprint or height is affected. (Manitowoc, No. 92 at p. 3) 
Scotsman stated in response to the NOPR and to the NODA that customers 
with space constraints could incur costs including but not limited to 
building renovation, water and wastewater service relocation, and 
electric service and countertop renovations. (Scotsman, No. 85 at p. 
5b-6b; No. 125 at p. 2) Scotsman also stated that any efficiency 
improvement greater than 5 percent would cause cabinet size increases. 
(Scotsman, No. 125 at p. 2) Policy Analyst stated that DOE should 
assess whether commercial ice maker installation costs are affected by 
its proposed standards. (Policy Analyst, No. 75, p. 10)
    Joint Commenters commented that DOE appropriately considered design 
options that increased package sizes, noting the options consumers have 
for purchases and noting the opportunity consumers might have to select 
smaller units given the low utilization factors used in the analysis. 
(Joint Commenters, No. 87, p. 3) NEEA similarly stated that DOE 
appropriately considered all the factors related to chassis size 
increase (NEEA, No. 91, pp. 1-2) PG&E and SDG&E, and CA IOU noted that 
it is unclear that insufficient space exists to increase chassis sizes 
in all situations. (PG&E and SDG&E, No. 89, p. 3, and CA IOU, No. 129, 
p. 4)
    As suggested by Policy Analyst and manufacturers, DOE investigated 
further the question of installation costs varying by efficiency 
levels. In particular, DOE investigated the issue around increased 
cabinet sizes for ice makers and modified the installation cost 
calculation methodology to reflect increased installation costs for 
equipment classes that are size constrained. In response to stakeholder 
comments and data supplied by stakeholders, DOE revised the analysis 
for three equipment classes with significant shipment volumes of 22-
inch-wide units and where height increases in the cabinets were 
considered in DOE's engineering analysis. In the engineering analysis 
for the final rule, DOE examined design options and efficiency level 
improvements for 22-inch units for three equipment classes under a 
scenario where no increase in equipment size was considered, resulting 
in two separate cost-efficiency curves (space constrained and non-space 
constrained) for each of these three classes (IMH-A-Small-B, IMH-A-
Large-B, and IMH-W-Small-B). Each of these equipment classes is 
designed for mounting on bins, ice dispensers, or fountain dispensers, 
and in the case of dispensers, generally the combination is mounted on 
a counter or table. For the LCC/PBP analysis and the NIA, DOE 
integrated the two curves for these equipment classes. To do so, at the 
efficiency level where the 22-inch engineering cost curves end, DOE 
researched the additional installation costs customers would incur in 
order to raise ceilings or move walls to make it possible for the 
customers to install the larger, non-22-inch units. As PG&E, SDG&E and 
CA IOU stated, not all installations lack sufficient space to 
accommodate increased chassis sizes. Based on the research performed 
for the final rule, DOE identified percentages of customers of the non-
space constrained equipment who also face size constraints, and 
estimated additional installation costs imposed by the need to raise 
ceilings or address other height constraints to facilitate cabinet size 
increases. Chapter 8 of the final rule TSD describes the process for 
including building renovation costs in the ACIM installation costs, and 
the inputs used in the analysis.
    In response to Hoshizaki and Manitowoc comments, DOE researched 
DWHX installation costs, and the cost to install larger remote 
condensers. In both cases, DOE identified incremental installation 
costs for these design options and added such to the installation costs 
at the efficiency levels that include these options.
    In response to Scotsman and Ice-O-Matic comments that the design 
options might cause customers to need to increase the size of 
electrical or water services, the specific technologies underlying the 
design options studied by DOE would not require increased electrical or 
water services. In performing the engineering analyses, DOE analyzed 
design options for each equipment class at the same voltage levels as 
existing typical units. As such, there is no reason to believe that 
meeting the energy conservation standard for any specific equipment 
class would require an increased electrical service. Similarly, there 
is reason to believe meeting the energy conservation standard would 
require greater water service, because no design options were analyzed 
which would increase water usage. Water or wastewater services 
relocations or countertop renovations would be required if customers 
move ice makers, but DOE's belief is that moving ice makers would not 
be a requirement imposed by the small cabinet size increases envisioned 
in this rulemaking.
    Additional information regarding the estimation of installation 
costs is presented in TSD chapter 8.
b. Repair and Maintenance Costs
    The repair cost is the average annual cost to the customer for 
replacing or repairing components in the automatic commercial ice maker 
that have failed. For the NOPR, DOE approximated repair costs based on 
an assessment of the components likely to fail within the lifetime of 
an automatic commercial ice maker in combination with the estimated 
cost of these components developed in the engineering analysis. Under 
this methodology, repair and replacement costs are based on the 
original equipment costs, so the more expensive the components are, the

[[Page 4699]]

greater the expected repair or replacement cost. For design options 
modeled in the engineering analysis, DOE estimated repair costs, and if 
they were different than the baseline cost, the repair costs were 
either increased or decreased accordingly.
    Maintenance costs are associated with maintaining the proper 
operation of the equipment. The maintenance cost does not include the 
costs associated with the replacement or repair of components that have 
failed, which are included as repair costs. In the NOPR analyses, DOE 
estimated material and labor costs for preventative maintenance based 
on RS Means cost estimation data and on telephone conservations with 
contractors. DOE assumed maintenance cost would remain constant for all 
efficiency levels within an equipment class.
    AHRI commented that it is incorrect to assume that changes in 
maintenance and repair will be negligible for more efficient equipment, 
and that DOE should contact parts distributors to find the price 
difference between permanent split-capacitor (PSC) and ECM motors and 
between 2-stage and 1-stage compressors. AHRI noted that dealers 
usually double their costs when invoicing equipment owners. (AHRI, No. 
93 at p. 4) Similarly, Scotsman commented that the supply-chain cost 
impact of the standards would be nearly equal in percentage to the 
manufactured product cost increase. (Scotsman, No. 85 at p. 5b)
    Scotsman commented that the expedited product development timeline 
would affect manufacturers by impeding the traditional product 
development process, resulting in a higher product failure rate, 
additional training burden, and increased repair costs and that this 
cost should be included in the analysis (Scotsman, Public Meeting 
Transcript, No. 70 at p. 212, p. 218, p. 219-220).
    In the final rule analysis released for the NODA, DOE added a 
``repair labor cost'' to the original repair cost, reflective of the 
cost of replacing individual components. DOE's research did not 
identify studies or data indicating that the failure rates, and in turn 
maintenance and repair costs, of energy-efficient equipment is 
significantly higher than traditional equipment. In response to AHRI's 
comments about contacting distributors about motors and compressors, 
DOE did collect labor information directly from service companies upon 
which to base the estimated labor hours. In response to AHRI's note 
about the doubling of costs, the total repair chain markup underlying 
DOE's estimated repair costs is 250 percent of direct equipment costs.
    In response to AHRI's comment about compressors, DOE did not 
include 2-stage compressors in the engineering analysis, and so the 
comment does not apply.
    In response to the Scotsman comment about warranty costs, DOE has 
no information indicating whether or how much failure rates will change 
as a result of standards implementation. To the extent that training 
and warranty costs are born by manufacturers and identified in the data 
collection efforts, such costs are included in the manufacturer impact 
analysis.
3. Annual Energy and Water Consumption
    Chapter 7 of the final rule TSD details DOE's analysis of annual 
energy and water usage at various efficiency levels of automatic 
commercial ice makers. Annual energy and water consumption inputs by 
automatic commercial ice maker equipment class are based on the 
engineering analysis estimates of kilowatt-hours of electricity per 100 
lb ice and gallons of water per 100 lb ice, translated to annual 
kilowatt-hours and gallons in the energy and water use analysis 
(chapter 7 of the final rule TSD). The development of energy and water 
usage inputs is discussed in section IV.F along with public input and 
DOE's response to the public input.
4. Energy Prices
    DOE calculated average commercial electricity prices using the EIA 
Form EIA-826 data obtained online from the ``Database: Sales 
(consumption), revenue, prices & customers'' Web page.\34\ The EIA data 
are the average commercial sector retail prices calculated as total 
revenues from commercial sales divided by total commercial energy sales 
in kilowatt-hours, by state and for the nation. DOE received no 
recommendations or suggestions regarding this set of assumptions at the 
April 2014 NOPR public meeting or in written comments.
---------------------------------------------------------------------------

    \34\ U.S. Energy Information Administration. Sales and revenue 
data by state, monthly back to 1990 (Form EIA-826). (Last accessed 
May 19, 2014). www.eia.gov/electricity/data.cfm#sales.
---------------------------------------------------------------------------

5. Energy Price Projections
    To estimate energy prices in future years for the NOPR and for the 
final rule, DOE multiplied the average state-level energy prices 
described in the previous paragraph by the forecast of annual average 
commercial energy price indices developed in the Reference Case from 
AEO2014.\35\ AEO2014 forecasted prices through 2040. To estimate the 
price trends after 2040, DOE assumed the same average annual rate of 
change in prices as exhibited by the forecast over the 2031 to 2040 
period. DOE received no recommendations or suggestions regarding this 
set of assumptions at the April 2014 public meeting or in written 
comments.
---------------------------------------------------------------------------

    \35\ The spreadsheet tool that DOE used to conduct the LCC and 
PBP analyses allows users to select price forecasts from either 
AEO's High Economic Growth or Low Economic Growth Cases. Users can 
thereby estimate the sensitivity of the LCC and PBP results to 
different energy price forecasts.
---------------------------------------------------------------------------

6. Water Prices
    To estimate water prices in future years for the NOPR, DOE used 
price data from the 2008,\36\ 2010,\37\ and 2012 American Water Works 
Association (AWWA) Water and Wastewater Surveys.\38\ The AWWA 2012 
survey was the primary data set. No data exists to disaggregate water 
prices for individual business types, so DOE varied prices by state 
only and not by business type within a state. For each state, DOE 
combined all individual utility observations within the state to 
develop one value for each state for water and wastewater service. 
Since water and wastewater billings are frequently tied to the same 
metered commodity values, DOE combined the prices for water and 
wastewater into one total dollars per 1,000 gallons figure. DOE used 
the Consumer Price Index (CPI) data for water-related consumption 
(1973-2012) \39\ in developing a real growth rate for water and 
wastewater price forecasts.
---------------------------------------------------------------------------

    \36\ American Water Works Association. 2008 Water and Wastewater 
Rate Survey. 2009. Denver, CO. Report No. 54004.
    \37\ American Water Works Association. 2010 Water and Wastewater 
Rate Survey. 2011. Denver, CO. Report No. 54006.
    \38\ American Water Works Association. 2012 Water and Wastewater 
Rate Survey. 2013. Denver, CO. Report No. 54008.
    \39\ The Bureau of Labor Statistics defines CPI as a measure of 
the average change over time in the prices paid by urban consumers 
for a market basket of consumer goods and services. For more 
information see www.bls.gov/cpi/home.htm.
---------------------------------------------------------------------------

    In written comments, the Alliance stated that DOE looked only at 
energy savings for air-cooled and water-cooled ACIM equipment, and that 
DOE should include water and wastewater cost in the LCC analysis. The 
Alliance notes that when such costs are included, air-cooled equipment 
is more cost-effective than water-cooled equipment. (Alliance, No. 73 
at p. 3) The Alliance further recommended that DOE should reflect the 
rising costs water and wastewater cost in its life cycle analysis. 
(Alliance, No. 73 at p. 3) The Alliance also

[[Page 4700]]

commented that DOE did not take into account the embedded energy needed 
to pump, tread and distribute water and to collect and treat 
wastewater, noting that the end user does not pay this cost and that it 
is paid by the water and wastewater user. (Alliance, No. 73 at p. 3, 
18-19)
    DOE includes water and wastewater cost in the LCC analysis and 
notes that real electric prices (2013$) escalate at roughly 0.4 percent 
between 2013 and 2047, while real water and wastewater prices escalate 
at roughly 2.0 percent over the same time period. DOE disagrees with 
the Alliance's comment that the end user of ice does not pay for the 
cost of energy embedded in the water used to make ice. This statement 
implies that the hotels, restaurants and other entities that use 
automatic commercial ice makers and pay the water and wastewater bills 
charge prices that do not fully recover all of their costs of doing 
business. DOE would agree that the end user of ice does not perceive 
the cost of the ice or any of the factors of production that went into 
the provision of the ice or the beverage served with the ice. However, 
DOE included water and wastewater costs in the LCC analyses, thereby 
capturing the cost of embedded energy in the analysis.
    In response to the Alliance's comparison of equipment types, DOE's 
final rule and final rule TSD present LCC results for all equipment 
classes. As discussed in section II.A of this preamble, DOE's 
rulemaking authority required DOE to promulgate standards that do not 
eliminate features or reduce customer utility. Because the existing 
standards established by Congress made water-cooled equipment separate 
equipment classes differentiated by the use of water in the condenser, 
DOE considers the use of water in the condenser to be a feature. For 
these reasons, DOE has no reason to make determinations that one 
equipment type is more cost-effective than another type.
    For the final rule, DOE updated the calculation of State-level 
water prices with the inclusion of 2013 consumer price index values.
7. Discount Rates
    The discount rate is the rate at which future expenditures are 
discounted to establish their present value. DOE determined the 
discount rate by estimating the cost of capital for purchasers of 
automatic commercial ice makers. Most purchasers use both debt and 
equity capital to fund investments. Therefore, for most purchasers, the 
discount rate is the weighted average cost of debt and equity 
financing, or the weighted average cost of capital (WACC), less the 
expected inflation.
    DOE received no comments at the April 2014 public meeting or in 
written form related to discount rates.
    To estimate the WACC of automatic commercial ice maker purchasers 
for the final rule, DOE used a sample of over 1,400 companies grouped 
to be representative of operators of each of the commercial business 
types (health care, lodging, foodservice, retail, education, food 
sales, and offices) drawn from a database of 7,765 U.S. companies 
presented on the Damodaran Online Web site.\40\ This database includes 
most of the publicly traded companies in the United States. The WACC 
approach for determining discount rates accounts for the current tax 
status of individual firms on an overall corporate basis. DOE did not 
evaluate the marginal effects of increased costs and the increased 
depreciation due to more expensive equipment, on the overall tax 
status.
---------------------------------------------------------------------------

    \40\ Damodaran financial data is available at http://
pages.stern.nyu.edu/~adamodar/ (Last accessed June 6, 2014).
---------------------------------------------------------------------------

    DOE used the final sample of companies to represent purchasers of 
automatic commercial ice makers. DOE combined company-specific 
information from the Damodaran Online Web site, long-term returns on 
the Standard & Poor's 500 stock market index from the Damodaran Online 
Web site, nominal long-term Federal government bond rates, and long-
term inflation to estimate a WACC for each firm in the sample.
    For most educational buildings and a portion of the office 
buildings and cafeterias occupied and/or operated by public schools, 
universities, and state and local government agencies, DOE estimated 
the cost of capital based on a 40-year geometric mean of an index of 
long-term (>20 years) tax-exempt municipal bonds.\41\ \42\ Federal 
office space was assumed to use the Federal bond rate, derived as the 
40-year geometric average of long-term (>10 years) U.S. government 
securities.\43\
---------------------------------------------------------------------------

    \41\ Federal Reserve Bank of St. Louis, State and Local Bonds--
Bond Buyer Go 20-Bond Municipal Bond Index. (Last accessed April 6, 
2012). Annual 1974-2011 data were available at http://research.stlouisfed.org/fred2/series/MSLB20/downloaddata?cid=32995.
    \42\ Rates for 2012 and 2013 calculated from monthly data. Data 
source: U.S. Federal Reserve (Last accessed July 10, 2014.) 
Available at http://www.federalreserve.gov/releases/h15/data.htm.
    \43\ Rate calculated with 1974-2013 data. Data source: U.S. 
Federal Reserve (Last accessed July 10, 2014.) Available at http://www.federalreserve.gov/releases/h15/data.htm.
---------------------------------------------------------------------------

    DOE recognizes that within the business types purchasing automatic 
commercial ice makers there will be small businesses with limited 
access to capital markets. Such businesses tend to be viewed as higher 
risk by lenders and face higher capital costs as a result. To account 
for this, DOE included an additional risk premium for small businesses. 
The premium, 1.9 percent, was developed from information found on the 
Small Business Administration Web site.\44\
---------------------------------------------------------------------------

    \44\ Small Business Administration data on loans between $10,000 
and $99,000 compared to AAA Corporate Rates. (Last accessed on June 
10, 2013.) Available at http://www.sba.gov/advocacy/7540/6282.
---------------------------------------------------------------------------

    Chapter 8 of the final rule TSD provides more information on the 
derivation of discount rates. The average discount rate by business 
type is shown on Table IV.27.

           Table IV.27--Average Discount Rate by Business Type
------------------------------------------------------------------------
                                                              Average
                      Business type                       discount  rate
                                                            (real) (%)
------------------------------------------------------------------------
Health Care.............................................             3.4
Lodging.................................................             7.9
Foodservice.............................................             7.1
Retail..................................................             5.8
Education...............................................             4.0
Food Sales..............................................             6.9
Office..................................................             6.2
------------------------------------------------------------------------

8. Lifetime
    DOE defines lifetime as the age at which typical automatic 
commercial ice maker equipment is retired from service. DOE estimated 
equipment lifetime based on its discussion with industry experts and 
concluded a typical lifetime of 8.5 years. For the NOPR analyses, DOE 
elected to use an 8.5-year average life for all equipment classes.
    DOE received written comments on the typical lifetime. Scotsman 
stated continuous units might have a shorter typical lifetime than 
batch type units but did not provide estimates of the difference. 
(Scotsman, No. 85 at p. 5b) Hoshizaki commented that 8.5 years is a 
good average lifetime assumption. (Hoshizaki, No. 86 at p. 3) AHRI 
commented that the average lifespan of continuous type ice makers is 7 
years based on warranty data. (AHRI, No. 93 at p. 7) NAFEM commented 
that DOE did not use adequate data to justify its assumed lifetime of 
8.5 years and that DOE should study the difference in lifetimes between 
batch type and continuous type ice makers. (NAFEM, No. 82 at p. 4)
    AHRI and NAFEM both commented that the proposed rule will increase 
the size and the cost of automatic commercial ice makers, and both 
pointed to the example of air

[[Page 4701]]

conditioners, where efficiency standards led to larger and more 
expensive units. The two stakeholders went on to state that annual air 
conditioner industry sales dropped about 18% while repair parts sales 
sharply increased. (NAFEM, No. 82 at p. 6 and p. 10; AHRI, No. 93 at p. 
8) Follett commented that the proposed rule is so stringent that it 
would create significant hardship for manufacturers and could require 
compromises to reliability and serviceability, adding that the rule 
could incent end-users to repair rather than replace their machines. 
(Follett, No. 84, at p. 1)
    With respect to NAFEM's comment about the adequacy of data, in the 
framework and preliminary analysis phases of this rulemaking, DOE 
surveyed the available literature and found a range of estimates of 7 
to 10 years, with 8.5 being the average. Literature cited on Table 
IV.28 suggested lifetimes of up to 20 years or more for automatic 
commercial ice makers, and this range was supported by discussion with 
experts.

   Table IV.28--Estimates for Automatic Commercial Ice Maker Lifetimes
------------------------------------------------------------------------
               Life                              Reference
------------------------------------------------------------------------
7 to 10 years....................  Arthur D. Little, 1996.\45\
8.5 years........................  California Energy Commission,
                                    2004.\46\
8.5 years........................  Fernstrom, G., 2004.\47\
8.5 years........................  Koeller J., and H. Hoffman, 2008.\48\
7 to 10 years....................  Navigant Consulting, Inc. 2009.\49\
------------------------------------------------------------------------

    With regard to the Scotsman's suggestion that continuous type ice 
makers might have shorter life spans, DOE found the comment lacking 
sufficient specific information to act on the comment. With respect to 
the AHRI comment that continuous equipment has a 7-year life, DOE notes 
that the phrase ``based on warranty data'' provided no information that 
DOE could analyze to determine whether to revise the assumed equipment 
lifetime. In addition, warranty claims do not necessarily correlate 
with product lifetime. For this reason, DOE decided based on the 
previous, generally high level of agreement with the 8.5-year lifetime 
to retain that lifetime as the basic assumption, and to use the 7-year 
continuous product life for sensitivity analyses.
---------------------------------------------------------------------------

    \45\ Arthur D. Little, Inc. Energy Savings for Commercial 
Refrigeration. Final Report. June, 1996. Submitted to the U.S. 
Department of Energy's Energy Efficiency and Renewable Energy 
Building Technologies Program. Washington, DC.
    \46\ California Energy Commission. Update of Appliance 
Efficiency Regulations. 2004. Sacramento, CA.
    \47\ Fernstrom, G. B. Analysis of Standards Options For 
Commercial Packaged Refrigerators, Freezers, Refrigerator-Freezers 
and Ice Makers: Codes and Standards Enhancement Initiative For 
PY2004: Title 20 Standards Development. 2004. Prepared by the 
American Council for an Energy-Efficient Economy for Pacific Gas & 
Electric Company, San Francisco, CA.
    \48\ Koeller J., and H. Hoffman. A report on Potential Best 
Management Practices. 2008. Prepared by Koeller and Company for the 
California Urban Water Conservation Council, Sacramento, CA.
    \49\ Navigant Consulting, Inc. Energy Savings Potential and R&D 
Opportunities for Commercial Refrigeration. Final Report. 2009. 
Submitted to the U.S. Department of Energy's Energy Efficiency and 
Renewable Energy Building Technologies Program, Washington, DC.
---------------------------------------------------------------------------

    With respect to the AHRI, NAFEM, and Follett comments about 
refurbishment, DOE acknowledges that the increased size and prices of 
automatic commercial ice makers arising from new and amended standards 
could lead to equipment refurbishing or the purchase of used equipment. 
DOE lacks sufficient information to explicitly model the extent of such 
refurbishment but believes that it would not be significant enough to 
change the rankings of TSLs. When DOE performed additional and recent 
research on repair costs before issuance of the NODA, contractors 
provided estimates of the hours to replace failed components such as 
compressors, but some also stated that they recommended replacing the 
ice maker instead of repairing it. In some cases the contractor 
recommendations were based on relative repair or replacement costs and 
warranties while in other cases they were based on the time it would 
take to get the required, specific ice maker components. DOE also notes 
that, given the engineering cost curves prepared for the final rule, 
when the baseline efficiency distribution of current shipments is taken 
into account, the average total cost increase faced by customers at TSL 
3 is less than 3 percent. For these reasons, DOE believes that the 
degree of refurbishing would not be significant enough to change the 
rankings of the TSLs considered in this rule.
9. Compliance Date of Standards
    EPCA prescribes that DOE must review and determine whether to amend 
performance-based standards for cube type automatic commercial ice 
makers by January 1, 2015. (42 U.S.C. 6313(d)(3)(A)) In addition, EPCA 
requires that the amended standards established in this rulemaking must 
apply to equipment that is manufactured on or after 3 years after the 
final rule is published in the Federal Register unless DOE determines, 
by rule, that a 3-year period is inadequate, in which case DOE may 
extend the compliance date for that standard by an additional 2 years. 
(42 U.S.C. 6313(d)(3)(C)) For the NOPR analyses, based on the January 
1, 2015 statutory deadline and giving manufacturers 3 years to meet the 
new and amended standards, DOE assumed that the most likely compliance 
date for the standards set by this rulemaking would be January 1, 2018. 
As discussed in section IV.A.2, DOE received comments about the 
compliance date, including requests to provide manufacturers 5 years to 
meet the new and amended standards. As stated in section IV.A.2, DOE 
believes that the modifications it made in the final rule analysis, 
relative to the NOPR, will reduce the burden on manufacturers to meet 
requirements established by this rule. Therefore, DOE has determined 
that the 3-year period is adequate and is not extending the compliance 
date for ACIMs. For the final rule, a compliance date of January 1, 
2018 was used for the LCC and PBP analysis.
10. Base-Case and Standards-Case Efficiency Distributions
    To estimate the share of affected customers who would likely be 
impacted by a standard at a particular efficiency level, DOE's LCC 
analysis considers the projected distribution of efficiencies of 
equipment that customers purchase under the base case (that is, the 
case without new energy efficiency standards). DOE refers to this 
distribution of equipment efficiencies as a base-case efficiency 
distribution.
    For the NOPR, DOE estimated market shares of each efficiency level 
within each equipment class based on an analysis of the automatic 
commercial ice makers available for purchase by customers. DOE analyzed 
all models available as of November 2012, calculated the percentage 
difference between the baseline energy usage embodied in the ice maker 
rulemaking analyses, and organized the available units by the 
efficiency levels. DOE then calculated the percentage of available 
models falling within each efficiency level bin. This efficiency 
distribution was used in the LCC and other downstream analyses as the 
baseline efficiency distribution.
    At the NOPR public meeting ASAP noted that the efficiency 
distribution used by DOE showed manufacturers can manufacture machines 
meeting the efficiency levels proposed in the NOPR.

[[Page 4702]]

(ASAP, Public Meeting Transcript, No. 70 at p. 256-257) Ice-O-Matic and 
Manitowoc stated that the distribution showed available equipment, but 
the equipment at the higher efficiencies might have small shipments 
relative to other efficiency levels. (Ice-O-Matic, Public Meeting 
Transcript, No. 70 at p. 260; Manitowoc, Public Meeting Transcript, No. 
70 at p. 261-263) Hoshizaki commented that DOE's shipments analysis 
would be more accurate if DOE requested actual shipment data under NDA 
from manufacturers each year. (Hoshizaki, No. 86 at p. 4) At the public 
meeting, manufacturers and AHRI agreed to compile shipments information 
by efficiency level.
    In written comments, AHRI supplied such information for batch type 
equipment. AHRI also stated that DOE should not use available models in 
the AHRI database to estimate shipment-weighted market shares by 
efficiency levels for batch type units, because by doing so, DOE 
overestimates potential energy savings by 11.3% or more. (AHRI, No. 93 
at p. 8-9)
    For the final rule, DOE used the efficiency distribution for batch 
type equipment provided by AHRI. While DOE did not analyze AHRI's 
statement of the overestimate of savings, DOE does consider the 
shipment-based distribution superior to the available-unit-based 
distribution. Lacking a similar shipment-based distribution for 
continuous equipment classes, DOE used an available-unit-based 
distribution for continuous equipment classes for the final rule.
11. Inputs to Payback Period Analysis
    Payback period is the amount of time it takes the customer to 
recover the higher purchase cost of more energy-efficient equipment as 
a result of lower operating costs. Numerically, the PBP is the ratio of 
the increase in purchase cost to the decrease in annual operating 
expenditures. This type of calculation is known as a ``simple'' PBP 
because it does not take into account changes in operating cost over 
time (i.e., as a result of changing cost of electricity) or the time 
value of money; that is, the calculation is done at an effective 
discount rate of zero percent. PBPs are expressed in years. PBPs 
greater than the life of the equipment mean that the increased total 
installed cost of the more-efficient equipment is not recovered in 
reduced operating costs over the life of the equipment, given the 
conditions specified within the analysis, such as electricity prices.
    The inputs to the PBP calculation are the total installed cost to 
the customer of the equipment for each efficiency level and the average 
annual operating expenditures for each efficiency level in the first 
year. The PBP calculation uses the same inputs as the LCC analysis, 
except that discount rates are not used.
    In written comments, Earthjustice stated that DOE inappropriately 
used a 3-year payback period as an upper limit for an acceptable 
customer impact without providing a justification for such, and that 
DOE should revise its approach for using payback period. (Earthjustice, 
No. 81, pp. 1-2) DOE acknowledges the comment and notes that, for the 
NOPR, DOE intended the use of the payback period as an illustration of 
the relatively significant differences between the impacts of TSLs.
12. Rebuttable Presumption Payback Period
    EPCA (42 U.S.C. 6295(o)(2)(B)(iii) and 6313(d)(4)) established a 
rebuttable presumption that new or amended standards are economically 
justified if the Secretary finds that the additional cost to the 
consumer of purchasing a product complying with an energy conservation 
standard level will be less than three times the value of the energy 
savings that the consumer will receive during the first year as a 
result of the standard, as calculated under the applicable test 
procedure.
    While DOE examined the rebuttable presumption criterion, it 
considered whether the standard levels considered are economically 
justified through a more detailed analysis of the economic impacts of 
these levels pursuant to 42 U.S.C. 6295(o)(2)(B)(iii) and 6313(d)(4). 
The results of this analysis served as the basis for DOE to evaluate 
the economic justification for a potential standard level definitively 
(thereby supporting or rebutting the results of any preliminary 
determination of economic justification).

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

    The NIA assesses the NES and the NPV of total customer costs and 
savings that would be expected as a result of the amended energy 
conservation standards. The NES and NPV are analyzed at specific 
efficiency levels (i.e., TSL) for each equipment class of automatic 
commercial ice makers. DOE calculates the NES and NPV based on 
projections of annual equipment shipments, along with the annual energy 
consumption and total installed cost data from the LCC analysis. For 
the NOPR analysis, DOE forecasted the energy savings, operating cost 
savings, equipment costs, and NPV of customer benefits for equipment 
sold from 2018 through 2047--the year in which the last standards-
compliant equipment is shipped during the 30-year analysis.
    DOE evaluates the impacts of the new and amended standards by 
comparing base-case projections with standards-case projections. The 
base-case projections characterize energy use and customer costs for 
each equipment class in the absence of any new or amended energy 
conservation standards. DOE compares these base-case projections with 
projections characterizing the market for each equipment class if DOE 
adopted the amended standards at each TSL. For the standards cases, DOE 
assumed a ``roll-up'' scenario in which equipment at efficiency levels 
that do not meet the standard level under consideration would ``roll 
up'' to the efficiency level that just meets the proposed standard 
level, and equipment already being purchased at efficiency levels at or 
above the proposed standard level would remain unaffected.
    DOE uses a Microsoft Excel spreadsheet model to calculate the 
energy savings and the national customer costs and savings from each 
TSL. Final rule TSD chapter 10 and appendix 10A explain the models and 
how to use them, and interested parties can review DOE's analyses by 
interacting with these spreadsheets. The models and documentation are 
available at: http://www1.eere.energy.gov/buildings/appliance_standards/rulemaking.aspx/ruleid/29.
    The NIA spreadsheet model uses average values as inputs (rather 
than probability distributions of key input parameters from a set of 
possible values). For the current analysis, the NIA used projections of 
energy prices and commercial building starts from the AEO2014 Reference 
Case. In addition, DOE analyzed scenarios that used inputs from the 
AEO2014 Low Economic Growth and High Economic Growth Cases. These cases 
have lower and higher energy price trends, respectively, compared to 
the Reference Case. NIA results based on these cases are presented in 
chapter 10 of the final rule TSD.
    A detailed description of the procedure to calculate NES and NPV 
and inputs for this analysis are provided in chapter 10 of the final 
rule TSD.
1. Shipments
    Comments related to the shipment analysis received at the April 
2014 public meeting were all questions for clarification. The following 
description of the shipments projection presents the shipments analysis 
for the final rule. The process described in this section

[[Page 4703]]

was documented and released for comments in the NODA.
    DOE obtained data from AHRI, ENERGY STAR, and U.S. Census Bureau's 
Current Industrial Reports (CIR) to estimate historical shipments for 
automatic commercial ice makers. AHRI provided DOE with automatic 
commercial ice maker shipment data for 2010 describing the distribution 
of shipments by equipment class and by harvest capacity. AHRI data 
provided to DOE also included an 11-year history of total shipments 
from 2000 to 2010. DOE also collected total automatic commercial ice 
maker shipment data for the period of 1973 to 2009 from the CIR. 
Additionally, DOE collected 2008-2012 data on ACIM shipments under the 
ENERGY STAR program. The ENERGY STAR data consisted of numbers of units 
meeting ENERGY STAR efficiency levels and the percent of the total 
market represented, from which the total market could be estimated. 
ENERGY STAR shipments only pertained to air-cooled batch equipment.
    In the preliminary analysis phase, DOE relied extensively on the 
CIR shipments data for the shipments projection. Subsequent to 
receiving comments on the preliminary analysis shipments, DOE relied 
more heavily on AHRI data for the NOPR and for the final rule shipments 
projections. After the NOPR analyses were completed, analysis of ENERGY 
STAR data led DOE to conclude that the AHRI data understates shipments 
by approximately 9 percent and that the difference was likely due to a 
greater number of manufacturers represented in the ENERGY STAR results. 
However, the AHRI data gives significantly greater detail than the 
ENERGY STAR data. Therefore, the final rule and the NOPR methodologies 
are identical except for an upward adjustment of the historical AHRI 
data by 9 percent to correct for the presumed under-reporting of non-
AHRI-members.
    To determine the percentage of shipments going to replace existing 
stock and the percentage represented by new installations, DOE used the 
CIR data to create a series of estimates of total existing stock by 
aggregating historical shipments across 8.5-year historical periods. 
DOE used the CIR data to estimate a time series of shipments and total 
stock for 1994 to 2006--at the time of the analysis, the last year of 
data available without significant gaps in the data due to disclosure 
limitations. For each year, using shipments, stock, and the 8.5-year 
life of the equipment, DOE estimated that, on average, 14 percent of 
shipments were for new installations and the remainder for replacement 
of existing stock.
    DOE then used the historical AHRI shipments to create a 2010 stock 
estimate. The 2010 stock and 2010 shipments from AHRI, disaggregated 
between new installations and shipments for existing stock replacement, 
were combined with projections of new construction activity from 
AEO2014 to generate a forecast of shipments for new installations. 
Stock and shipments were first disaggregated to individual business 
types based on data developed for DOE on commercial ice maker 
stocks.\50\ The business types and share of stock represented by each 
type are shown in Table IV.29. Using a Weibull distribution assuming 
that equipment has an average life of 8.5 years and lasts from 5 to 11 
years, DOE developed a 30-year series of replacement ice maker 
shipments using the AHRI historical series. Using the estimated 2010 
shipments to new installations, and year-to-year changes in new 
commercial sector floor space additions from AEO2014, DOE estimated 
future shipments for new installations. (For the NOPR, DOE used AEO2013 
projections of floor space additions.) The AEO2014 floor space 
additions by building type are shown in Table IV.30. The combination of 
the replacement and new installation shipments yields total shipments. 
The final step was to distribute total sales to equipment classes by 
multiplying the total shipments by percentage shares by class. Table 
IV.31 shows the percentages represented by all equipment classes, both 
the primary classes modeled explicitly in all NOPR analyses as well as 
the secondary classes.
---------------------------------------------------------------------------

    \50\ Navigant Consulting, Inc. Energy Savings Potential and R&D 
Opportunities for Commercial Refrigeration. Final Report, submitted 
to the U.S. Department of Energy. September 23, 2009. p. 41.

       Table IV.29--Business Types Included in Shipments Analysis
------------------------------------------------------------------------
                                                           Building type
                      Building type                        as percent of
                                                             stock (%)
------------------------------------------------------------------------
Health Care.............................................               9
Lodging.................................................              33
Foodservice.............................................              22
Retail..................................................               8
Education...............................................               7
Food Sales..............................................              16
Office..................................................               4
                                                         ---------------
    Total...............................................             100
------------------------------------------------------------------------

                                              Table IV.30--AEO2014 Forecast of New Building Square Footage
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                         New construction
                                         ---------------------------------------------------------------------------------------------------------------
                  Year                                                                     million ft\2\
                                         ---------------------------------------------------------------------------------------------------------------
                                            Health Care       Lodging       Foodservice       Retail         Education      Food sales        Office
--------------------------------------------------------------------------------------------------------------------------------------------------------
2013....................................              66             147              31             279             247              21             174
2018....................................              67             164              51             428             209              36             411
2020....................................              65             176              47             404             197              33             451
2025....................................              63             181              48             444             169              34             392
2030....................................              71             150              55             515             190              39             276
2035....................................              72             207              57             527             228              40             415
2040....................................              76             188              56             565             252              40             403
Annual Growth Factor, 2031-2040.........            2.4%            2.5%            2.4%            2.5%            1.7%            2.3%            2.1%
--------------------------------------------------------------------------------------------------------------------------------------------------------

[[Page 4704]]

Table IV.31--Percent of Shipped Units of Automatic Commercial Ice Makers
------------------------------------------------------------------------
                                                           Percentage of
                     Equipment class                       shipments (%)
------------------------------------------------------------------------
IMH-W-Small-B...........................................            4.54
IMH-W-Med-B.............................................            2.90
IMH-W-Large-B...........................................            0.48
IMH-A-Small-B...........................................           27.08
IMH-A-Large-B...........................................           16.14
RCU-Small-B.............................................            5.43
RCU-RC/NC-Large-B.......................................            6.08
SCU-W-Small-B...........................................            0.68
SCU-W-Large-B...........................................            0.22
SCU-A-Small-B...........................................           13.85
SCU-A-Large-B...........................................            6.56
IMH-W-Small-C...........................................            0.68
IMH-W-Large-C...........................................            0.17
IMH-A-Small-C...........................................            3.53
IMH-A-Large-C...........................................            1.07
RCU-Small-C.............................................            0.83
RCU-Large-C.............................................            0.87
SCU-W-Small-C...........................................            0.15
SCU-W-Large-C...........................................            0.00
SCU-A-Small-C...........................................            8.75
SCU-A-Large-C...........................................            0.00
                                                         ---------------
    Total...............................................          100.00
------------------------------------------------------------------------
Source: AHRI, 2010 Shipments data submitted to DOE as part of this
  rulemaking.

2. Forecasted Efficiency in the Base Case and Standards Cases
    The method for estimating the market share distribution of 
efficiency levels is presented in section IV.G.10, and a detailed 
description can be found in chapter 10 of the final rule TSD. To 
estimate efficiency trends in the standards cases, DOE uses a ``roll-
up'' scenario in its standards rulemakings. Under the ``roll-up'' 
scenario, DOE assumes that equipment efficiencies in the base case that 
do not meet the standard level under consideration would ``roll up'' to 
the efficiency level that just meets the proposed standard level, and 
equipment already being purchased at efficiencies at or above the 
standard level under consideration would be unaffected. Table IV.32 
shows the shipment-weighted market shares by efficiency level in the 
base-case scenario.

                                       Table IV.32--Shipment-Weighted Market Shares by Efficiency Level, Base Case
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                    Market share by efficiency level Percent
                   Equipment class                    --------------------------------------------------------------------------------------------------
                                                        Level 1    Level 2    Level 3    Level 3A   Level 4    Level 4A   Level 5    Level 6    Level 7
--------------------------------------------------------------------------------------------------------------------------------------------------------
IMH-W-Small-B........................................       37.1       15.6       44.8  .........        2.5        0.0        0.0  .........  .........
IMH-W-Med-B..........................................       55.8       20.0       15.3  .........        8.9  .........  .........  .........  .........
IMH-W-Large-B
    IMH-W-Large-B-1..................................       87.2       12.8  .........  .........  .........  .........  .........  .........  .........
    IMH-W-Large-B-2..................................       87.2       12.8  .........  .........  .........  .........  .........  .........  .........
IMH-A-Small-B........................................       23.7       29.5       46.8        0.0        0.0  .........        0.0        0.0  .........
IMH-A-Large-B
    IMH-A-Large-B-1..................................       34.1       27.8       35.1        0.3        2.7  .........  .........  .........  .........
    IMH-A-Large-B-2..................................       16.8       22.5       60.8  .........  .........  .........  .........  .........  .........
RCU-Large-B
    RCU-Large-B-1....................................       43.9       36.4       18.8  .........        1.0  .........  .........  .........  .........
    RCU-Large-B-2....................................       43.9       36.4       18.8  .........        1.0  .........  .........  .........  .........
SCU-W-Large-B........................................       71.6        0.6        0.0  .........       22.5  .........        5.4        0.0  .........
SCU-A-Small-B........................................       51.8       15.3       12.9  .........        8.0  .........       12.0        0.0        0.0
SCU-A-Large-B........................................       62.6       14.8       21.5  .........        0.0  .........        1.1        0.0  .........
IMH-A-Small-C........................................       30.6       11.1       19.4  .........        5.6  .........       19.4       13.9  .........
IMH-A-Large-C........................................       43.5       21.7       17.4  .........        8.7  .........        8.7  .........  .........
RCU-Small-C..........................................       27.8       27.8       33.3  .........        5.6  .........        0.0        5.6  .........
SCU-A-Small-C........................................       44.1        8.8       14.7  .........       17.6  .........       14.7        0.0  .........
--------------------------------------------------------------------------------------------------------------------------------------------------------

3. National Energy Savings
    For each year in the forecast period, DOE calculates the NES for 
each TSL by multiplying the stock of equipment affected by the energy 
conservation standards by the estimated per-unit annual energy savings. 
DOE typically considers the impact of a rebound effect, introduced in 
the energy use analysis, in its calculation of NES for a given product. 
A rebound effect occurs when users operate higher-efficiency equipment 
more frequently and/or for longer durations, thus offsetting estimated 
energy savings. When a rebound effect occurs, it is generally because 
the users of the equipment perceive it as less costly to use the 
equipment and elect to use it more intensively. In the case of 
automatic commercial ice makers, users of the equipment include 
restaurant wait staff, hotel guests, cafeteria patrons, or hospital 
staff using ice in the treatment of patients. Users of automatic 
commercial ice makers tend to have little or no perception of or 
personal stake in the cost of the ice and rather are using the ice to 
serve a specific need. Given this, DOE believes there is very little or 
no potential for a rebound effect. For the NIA, DOE used a rebound 
factor of 1, or no effect, for automatic commercial ice makers.
    At the NOPR phase, the only comment regarding rebound effect was 
from the Policy Analyst. Policy Analyst stated that DOE should evaluate 
whether there was a rebound effect caused by the previous standard. 
(Policy Analyst, No. 75 at p. 10) As stated above, DOE believes that 
the users of ACIM equipment would not perceive the price effects, so 
DOE believes rebound effect should not be present for this equipment 
and does not believe further analysis is necessary.
    Inputs to the calculation of NES are annual unit energy 
consumption, shipments, equipment stock, and a site-to-source 
conversion factor.
    The annual unit energy consumption is the site energy consumed by 
an automatic commercial ice maker unit in a given year. Using the 
efficiency of units at each efficiency level and the baseline 
efficiency distribution, DOE determined annual forecasted shipment-
weighted average equipment efficiencies

[[Page 4705]]

that, in turn, enabled determination of shipment-weighted annual energy 
consumption values.
    The automatic commercial ice makers stock in a given year is the 
total number of automatic commercial ice makers shipped from earlier 
years (up to 12 years earlier) that remain in use in that year. The NES 
spreadsheet model keeps track of the total units shipped each year. For 
purposes of the NES and NPV analyses in the NOPR analysis, DOE assumed 
that, based on an 8.5-year average equipment lifetimes, approximately 
12 percent of the existing automatic commercial ice makers are retired 
and replaced in each year. DOE assumes that, for units shipped in 2047, 
any units still remaining at the end of 2055 will be replaced.
    DOE uses a multiplicative factor called ``site-to-source conversion 
factor'' to convert site energy consumption (at the commercial 
building) into primary or source energy consumption (the energy input 
at the energy generation station required to convert and deliver the 
energy required at the site of consumption). These site-to-source 
conversion factors account for the energy used at power plants to 
generate electricity and for the losses in transmission and 
distribution, as well as for natural gas losses from pipeline leakage 
and energy used for pumping. For electricity, the conversion factors 
vary over time due to projected changes in generation sources (that is, 
the power plant types projected to provide electricity to the country). 
The factors that DOE developed are marginal values, which represent the 
response of the system to an incremental decrease in consumption 
associated with amended energy conservation standards.
    For this final rule, DOE used conversion factors based on the U.S. 
energy sector modeling using the National Energy Modeling System (NEMS) 
Building Technologies (NEMS-BT) version that corresponds to AEO2014 and 
which provides national energy forecasts through 2040. Within the 
results of NEMS-BT model runs performed by DOE, a site-to-source ratio 
for commercial refrigeration was developed. The site-to-source ratio 
was held constant beyond 2040 through the end of the analysis period 
(30 years plus the life of equipment).
    DOE has historically presented NES in terms of primary energy 
savings. In response to the recommendations of a committee on ``Point-
of-Use and Full-Fuel-Cycle Measurement Approaches to Energy Efficiency 
Standards'' appointed by the National Academy of Science, DOE announced 
its intention to use full-fuel-cycle (FFC) measures of energy use and 
greenhouse gas and other emissions in the national impact analyses and 
emissions analyses included in future energy conservation standards 
rulemakings. 76 FR 51281 (August 18, 2011) After evaluating both models 
and the approaches discussed in the August 18, 2011, notice, DOE 
published a statement of amended policy in the Federal Register in 
which DOE explained its determination that NEMS is a more appropriate 
tool for its FFC analysis and its intention to use NEMS for that 
purpose. 77 FR 49701 (August 17, 2012). DOE received one comment, which 
was supportive of the use of NEMS for DOE's FFC analysis.\51\
---------------------------------------------------------------------------

    \51\ Docket ID: EERE-2010-BT-NOA-0028, comment by Kirk 
Lundblade.
---------------------------------------------------------------------------

    The approach used for this final rule, and the FFC multipliers that 
were applied are described in appendix 10D of the final rule TSD. NES 
results are presented in both primary and in terms of FFC savings. The 
savings by TSL are summarized in terms of FFC savings in section I.C.
4. Net Present Value of Customer Benefit
    The inputs for determining the NPV of the total costs and benefits 
experienced by customers of the automatic commercial ice makers are (1) 
total annual installed cost; (2) total annual savings in operating 
costs; and (3) a discount factor. DOE calculated net national customer 
savings for each year as the difference in installation and operating 
costs between the base-case scenario and standards-case scenarios. DOE 
calculated operating cost savings over the life of each piece of 
equipment shipped in the forecast period.
    DOE multiplied monetary values in future years by the discount 
factor to determine the present value of costs and savings. DOE 
estimated national impacts with both a 3-percent and a 7-percent real 
discount rate as the average real rate of return on private investment 
in the U.S. economy. These discount rates are used in accordance with 
the Office of Management and Budget (OMB) guidance to Federal agencies 
on the development of regulatory analysis (OMB Circular A-4, September 
17, 2003), and section E, ``Identifying and Measuring Benefits and 
Costs,'' therein. DOE defined the present year as 2013 for the NOPR 
analysis. The 7-percent real value is an estimate of the average 
before-tax rate of return to private capital in the U.S. economy. DOE 
used the 3-percent rate to capture the potential effects of the new and 
amended standards on private consumption. This rate represents the 
``societal rate of time preference,'' which is the rate at which 
society discounts future consumption flows to their present.
    DOE received one comment from Ice-O-Matic stating that the 7-
percent discount rate was too high when the current prime rate is 3.25 
percent and the current Treasury bill rate is 3.67 percent. (Ice-O-
Matic, No. 120, p. 1; Ice-O-Matic, No. 121, p. 1) Ice-O-Matic also 
indicated that the use of 7-percent discount rate inflated the rate of 
return experienced by customers. (Ice-O-Matic, No. 120, p. 1)
    As Ice-O-Matic noted, the discount rate is high relative to current 
interest rates. However, DOE suspects that the comments misinterpreted 
the use of the discount rate. In this case, the discount rate is used 
to express a given number of future dollars as an equivalent number of 
dollars today, whereas the comments seemed to assume the discount rate 
was used as an interest rate to express a given number of dollars today 
as a future value equivalent. Since the 7-percent discount rate that 
DOE used in the NIA is used in accordance with OMB guidelines, DOE will 
continue using it in the NIA.
    As discussed in section IV.G.1, DOE included a projection of price 
trends in the preliminary analysis NIA. For the NOPR, DOE reviewed and 
updated the analysis with the result that the projected reference case 
downward trend in prices is quite modest. For the NOPR, DOE also 
developed high and low case price trend projections, as discussed in 
final rule TSD appendix 10B.

I. Customer Subgroup Analysis

    In analyzing the potential impact of new or amended standards on 
commercial customers, DOE evaluates the impact on identifiable groups 
(i.e., subgroups) of customers, such as different types of businesses 
that may be disproportionately affected. Small businesses typically 
face a higher cost of capital. In general, the lower the cost of 
electricity and higher the cost of capital, the more likely it is that 
an entity would be disadvantaged by the requirement to purchase higher 
efficiency equipment. Based on the data available to DOE, automatic 
commercial ice maker ownership in three building types represent over 
70 percent of the market: Food sales, foodservice, and hotels. Based on 
data from the 2007 U.S. Economic Census and size standards set by the 
U.S. Small Business Administration (SBA), DOE determined that a 
majority of food sales, foodservice and lodging firms fall under the 
definition of small businesses. Chapter

[[Page 4706]]

8 of the TSD presents the electricity price by business type and 
discount rates by building types, respectively, while chapter 11 
discusses these topics as they specifically relate to small businesses.
    Comparing the foodservice, food sales, and lodging categories, 
foodservice faces the highest energy price, with food sales and lodging 
facing lower and nearly the same energy prices. Lodging faces the 
highest cost of capital. Foodservice faces a higher cost of capital 
than food sales. Given the cost of capital disparity, lodging was 
selected for LCC subgroup analysis. With foodservice facing a higher 
cost of capital, it was selected for LCC subgroup analysis because the 
higher cost of capital should lead foodservice customers to value first 
cost more and future electricity savings less than would be the case 
for food sales customers.
    Three written comments specifically focused on the customer 
subgroups, all three specifically focusing on the food service 
industry. U.S. Senator Toomey commented that the proposed rule will 
negatively impact employment in the food services industry, which is 
dominated by small businesses, and that restaurant owners would already 
purchase efficient products if they were going to be able to recoup the 
higher prices through savings. (U.S. Senator Toomey, No. 79 at p. 1) 
NRA commented that the cost of new standards could be greater for small 
businesses, due to increased capital, maintenance, repair, and 
installation costs, thus affecting their payback period. (NRA, No. 69 
at p. 2-3) NAFEM commented that the proposed rule will affect the food 
service industry, which is also dominated by small businesses, because 
they will not be able to afford equipment upgrades and will choose to 
extend the life of used equipment. (NAFEM, No. 82 at p. 5)
    With respect to the issue of negative employment impacts, if the 
standard has a positive LCC benefit to the food service customer, such 
an impact should not reduce employment. DOE notes that the LCC analysis 
looks strictly at the net economic impact of a hypothetical purchase of 
equipment and does not look specifically at employment. However, if the 
analysis shows a net LCC benefit, the food service customer should be 
better off and presumably such result should not negatively impact 
employment. DOE agrees with the NRA comment that the cost of new 
standards could be greater for small businesses and notes the analysis 
of the impacts is precisely the point of the customer subgroup 
analysis.
    With respect to NAFEM's comment regarding small business's 
inability to afford the equipment upgrades, if the results indicate 
positive LCC benefits the presumption is that the customer's financial 
situation is improved with the more efficient equipment when compared 
to less efficient equipment. DOE lacks information with which to 
estimate the extent to which customers might choose to extend the life 
of equipment, but believes that given the relatively modest average 
price increase of the proposed standard (approximately 3 percent) in 
combination with the customer energy savings, the proportion of 
customers who would choose life extension is small.
    DOE estimated the impact on the identified customer subgroups using 
the LCC spreadsheet model. The standard LCC and PBP analyses (described 
in section IV.F) include various types of businesses that use automatic 
commercial ice makers. For the LCC subgroup analysis, it was assumed 
that the subgroups analyzed do not have access to national purchasing 
accounts or to major capital markets thereby making the discount rates 
higher for these subgroups. Details of the data used for LCC subgroup 
analysis and results are presented in chapter 11 of the TSD.

J. Manufacturer Impact Analysis

1. Overview
    DOE performed an MIA to estimate the impacts of new and amended 
energy conservation standards on manufacturers of automatic commercial 
ice makers. The MIA has both quantitative and qualitative aspects and 
includes analyses of forecasted industry cash flows, the INPV, 
investments in research and development (R&D) and manufacturing 
capital, and domestic manufacturing employment. Additionally, the MIA 
seeks to determine how amended energy conservation standards might 
affect manufacturing employment, capacity, and competition, as well as 
how standards contribute to overall regulatory burden. Finally, the MIA 
serves to identify any disproportionate impacts on manufacturer 
subgroups, in particular, small businesses.
    The quantitative part of the MIA primarily relies on the Government 
Regulatory Impact Model (GRIM), an industry cash flow model with inputs 
specific to this rulemaking. The key GRIM inputs include data on the 
industry cost structure, unit production costs, product shipments, 
manufacturer markups, and investments in R&D and manufacturing capital 
required to produce compliant products. A key GRIM output is the INPV, 
which is the sum of industry annual cash flows over the analysis 
period, discounted using the industry weighted average cost of capital. 
Another key output is the impact to domestic manufacturing employment. 
The model estimates the impacts of more-stringent energy conservation 
standards on a given industry by comparing changes in INPV and domestic 
manufacturing employment between a base case and the various TSLs in 
the standards case. To capture the uncertainty relating to manufacturer 
pricing strategy following amended standards, the GRIM estimates a 
range of possible impacts under different markup scenarios.
    The qualitative part of the MIA addresses manufacturer 
characteristics and market trends. Specifically, the MIA considers such 
factors as manufacturing capacity, competition within the industry, the 
cumulative impact of other DOE and non-DOE regulations, and impacts on 
small business manufacturers. The complete MIA is outlined in chapter 
12 of the final rule TSD.
    DOE conducted the MIA for this rulemaking in three phases. In Phase 
1 of the MIA, DOE prepared a profile of the automatic commercial ice 
maker industry. This included a top-down cost analysis of automatic 
commercial ice maker manufacturers that DOE used to derive preliminary 
financial inputs for the GRIM (e.g., revenues; materials, labor, 
overhead, and depreciation expenses; selling, general, and 
administrative expenses (SG&A); and R&D expenses). DOE also used public 
sources of information to further calibrate its initial 
characterization of the automatic commercial ice maker industry, 
including company Securities and Exchange Commission (SEC) 10-K 
filings,\52\ corporate annual reports, the U.S. Census Bureau's 
Economic Census,\53\ and Hoover's reports.\54\
---------------------------------------------------------------------------

    \52\ U.S. Securities and Exchange Commission. Annual 10-K 
Reports. Various Years. http://sec.gov.
    \53\ U.S.Census Bureau, Annual Survey of Manufacturers: General 
Statistics: Statistics for Industry Groups and Industries. http://factfinder2.census.gov/faces/nav/jsf/pages/searchresults.xhtml?refresh=t.
    \54\ Hoovers Inc. Company Profiles. Various Companies. http://www.hoovers.com.
---------------------------------------------------------------------------

    In Phase 2 of the MIA, DOE prepared a framework industry cash flow 
analysis to quantify the impacts of new and amended energy conservation 
standards. The GRIM uses several factors to determine a series of 
annual cash flows starting with the announcement of the standard and 
extending over a 30-year period

[[Page 4707]]

following the effective date of the standard. These factors include 
annual expected revenues, costs of sales, SG&A and R&D expenses, taxes, 
and capital expenditures. In general, energy conservation standards can 
affect manufacturer cash flow in three distinct ways: (1) Create a need 
for increased investment; (2) raise production costs per unit; and (3) 
alter revenue due to higher per-unit prices and changes in sales 
volumes.
    In addition, during Phase 2, DOE developed interview guides to 
distribute to manufacturers of automatic commercial ice makers in order 
to develop other key GRIM inputs, including product and capital 
conversion costs, and to gather additional information on the 
anticipated effects of energy conservation standards on revenues, 
direct employment, capital assets, industry competitiveness, and 
subgroup impacts.
    In Phase 3 of the MIA, DOE conducted structured, detailed 
interviews with a representative cross-section of manufacturers. During 
these interviews, DOE discussed engineering, manufacturing, 
procurement, and financial topics to validate assumptions used in the 
GRIM and to identify key issues or concerns. As part of Phase 3, DOE 
also evaluated subgroups of manufacturers that may be 
disproportionately impacted by amended standards or that may not be 
accurately represented by the average cost assumptions used to develop 
the industry cash flow analysis. Such manufacturer subgroups may 
include small manufacturers, low volume manufacturers, niche players, 
and/or manufacturers exhibiting a cost structure that largely differs 
from the industry average.
    DOE identified one subgroup, small manufacturers, for which average 
cost assumptions may not hold. DOE applied the small business size 
standards published by the SBA to determine whether a company is 
considered a small business. 65 FR 30836 (May 15, 2000), as amended by 
65 FR 53533 (Sept. 5, 2000) and 67 FR 52597 (Aug. 13, 2002), as 
codified at 13 CFR part 121. The Small Business Administration (SBA) 
defines a small business for North American Industry Classification 
System (NAICS) 333415, ``Air-Conditioning and Warm Air Heating 
Equipment and Commercial and Industrial Refrigeration Equipment 
Manufacturing,'' which includes commercial ice maker manufacturing, as 
having 750 or fewer employees. The 750-employee threshold includes all 
employees in a business's parent company and any other subsidiaries. 
Based on this classification, DOE identified seven manufacturers of 
automatic commercial ice makers that qualify as small businesses. The 
automatic commercial ice maker small manufacturer subgroup is discussed 
in chapter 12 of the final rule TSD and in section VI.B.1 of this 
rulemaking.
2. Government Regulatory Impact Model
    DOE uses the GRIM to quantify the changes in industry cash flows 
resulting from new or amended energy conservation standards. The GRIM 
uses manufacturer costs, markups, shipments, and industry financial 
information to arrive at a series of base-case annual cash flows absent 
new or amended standards, beginning in 2015 and continuing through 
2047. The GRIM then models changes in costs, investments, shipments, 
and manufacturer margins that may result from new or amended energy 
conservation standards and compares these results against those in the 
base-case forecast of annual cash flows. The primary quantitative 
output of the GRIM is the INPV, which DOE calculates by summing the 
stream of annual discounted cash flows over the full analysis period. 
For manufacturers of automatic commercial ice makers, DOE used a real 
discount rate of 9.2 percent, based on the weighted average cost of 
capital as derived from industry financials and feedback received 
during confidential interviews with manufacturers.
    The GRIM calculates cash flows using standard accounting principles 
and compares changes in INPV between the base case and each TSL. The 
difference in INPV between the base case and a standards case 
represents the financial impact of the amended standard on 
manufacturers at that particular TSL. As discussed previously, DOE 
collected the necessary information to develop key GRIM inputs from a 
number of sources, including publicly available data and interviews 
with manufacturers (described in the next section). The GRIM results 
are shown in section V.B.2.a. Additional details about the GRIM can be 
found in chapter 12 of the final rule TSD.
a. Government Regulatory Impact Model Key Inputs
Manufacturer Production Costs
    Manufacturing higher efficiency equipment is typically more 
expensive than manufacturing baseline equipment due to the use of more 
complex, and typically more costly, components. The changes in the MPCs 
of the analyzed equipment can affect the revenues, gross margins, and 
cash flow of the industry, making production cost data key GRIM inputs 
for DOE's analysis.
    For each efficiency level of each equipment class that was directly 
analyzed, DOE used the MPCs developed in the engineering analysis, as 
described in section IV.B and further detailed in chapter 5 of the 
final rule TSD. For equipment classes that were indirectly analyzed, 
DOE used a composite of MPCs from similar equipment classes, substitute 
component costs, and design options to develop an MPC for each 
efficiency level. For equipment classes that had multiple units 
analyzed, DOE used a weighted average MPC based on the relative 
shipments of products at each efficiency level as the input for the 
GRIM. Additionally, DOE used information from its reverse engineering 
analysis, described in section IV.D.4, to disaggregate the MPCs into 
material and labor costs. These cost breakdowns and equipment markups 
were validated with manufacturers during manufacturer interviews.
Base-Case Shipments Forecast
    The GRIM estimates manufacturer revenues based on total unit 
shipment forecasts and the distribution of shipments by efficiency 
level. Changes in sales volumes and efficiency mix over time can 
significantly affect manufacturer finances. For the base-case analysis, 
the GRIM uses the NIA's annual shipment forecasts from 2015, the base 
year, to 2047, the end of the analysis period. See chapter 9 of the 
final rule TSD for additional details.
Product Conversion Costs, Capital Conversion Costs, and Stranded Assets
    New and amended energy conservation standards will cause 
manufacturers to incur conversion costs to bring their production 
facilities and product designs into compliance. For the MIA, DOE 
classified these conversion costs into two major groups: (1) Product 
conversion costs and (2) capital conversion costs. Product conversion 
costs include investments in research, development, testing, marketing, 
and other non-capitalized costs necessary to make product designs 
comply with new or amended energy conservation standards. Capital 
conversion costs include investments in property, plant, and equipment 
necessary to adapt or change existing production facilities such that 
new product designs can be fabricated and assembled.
    If new or amended energy conservation standards require

[[Page 4708]]

investment in new manufacturing capital, there also exists the 
possibility that they will render existing manufacturing capital 
obsolete. In the case that this obsolete manufacturing capital is not 
fully depreciated at the time new or amended standards go into effect, 
this would result in the stranding of these assets, and would 
necessitate the write-down of their residual un-depreciated value.
    DOE used multiple sources of data to evaluate the level of product 
and capital conversion costs and stranded assets manufacturers would 
likely face to comply with new or amended energy conservation 
standards. DOE used manufacturer interviews to gather data on the level 
of investment anticipated at each proposed efficiency level and 
validated these assumptions using estimates of capital requirements 
derived from the product teardown analysis and engineering model 
described in section IV.D.4. These estimates were then aggregated and 
scaled using information gained from industry product databases to 
derive total industry estimates of product and capital conversion costs 
and to protect confidential information.
    In general, DOE assumes that all conversion-related investments 
occur between the year the final rule is published and the year by 
which manufacturers must comply with the new or amended standards. The 
investment figures used in the GRIM can be found in section V.B.2.a of 
this preamble. For additional information on the estimated product 
conversion and capital conversion costs, see chapter 12 of the final 
rule TSD.
b. Government Regulatory Impact Model Scenarios
Markup Scenarios
    As discussed in section IV.J.2.b MSPs include direct manufacturing 
production costs (i.e., labor, material, overhead, and depreciation 
estimated in DOE's MPCs) and all non-production costs (i.e., SG&A, R&D, 
and interest), along with profit. To calculate the MSPs in the GRIM, 
DOE applied manufacturer markups to the MPCs estimated in the 
engineering analysis. Modifying these markups in the standards case 
yields different sets of impacts on manufacturers. For the MIA, DOE 
modeled two standards-case markup scenarios to represent the 
uncertainty regarding the potential impacts on prices and profitability 
for manufacturers following the implementation of amended energy 
conservation standards: (1) A preservation of gross margin percentage 
markup scenario; and (2) a preservation of earnings before interest and 
taxes (EBIT) markup scenario. These scenarios lead to different markups 
values that, when applied to the MPCs, result in varying revenue and 
cash flow impacts.
    Under the preservation of gross margin percentage scenario, DOE 
applied a single, uniform ``gross margin percentage'' markup across all 
efficiency levels. As production costs increase with efficiency, this 
scenario implies that the absolute dollar markup will increase as well. 
Based on publicly available financial information for manufacturers of 
automatic commercial ice makers and comments from manufacturer 
interviews, DOE assumed the industry average markup on production costs 
to be 1.25. Because this markup scenario assumes that manufacturers 
would be able to maintain their gross margin percentage as production 
costs increase in response to new and amended energy conservation 
standards, it represents a lower bound of industry impacts (higher 
industry profitability) under new and amended energy conservation 
standards.
    In the preservation of EBIT markup scenario, manufacturer markups 
are calibrated so that EBIT in the year after the compliance date of 
the amended energy conservation standard is the same as in the base 
case. Under this scenario, as the cost of production goes up, 
manufacturers are generally required to reduce the markups on their 
minimally compliant products to maintain a cost-competitive offering. 
The implicit assumption behind this scenario is that the industry can 
only maintain EBIT in absolute dollars after compliance with the 
amended standard is required. Therefore, operating margin (as a 
percentage) shrinks in the standards cases. This markup scenario 
represents an upper bound of industry impacts (lower profitability) 
under an amended energy conservation standard.
3. Discussion of Comments
    During the NOPR public meeting, interested parties commented on the 
assumptions and results of the analyses in the NOPR TSD. In addition, 
interested parties submitted written comments on the assumptions and 
results of the NOPR TSD and NODA. DOE summarizes the MIA related 
comments below:
a. Conversion Costs
    At the NOPR Stage, several stakeholders pointed out high capital 
costs and intense redesign efforts would be required by the proposed 
standards. Hoshizaki commented that many of the design options 
suggested in this rulemaking would require manufacturers to modify or 
buy new tooling and grow packaging, pallets, and conveyor belts to 
accommodate larger machines. Hoshizaki noted that these costs would 
compound to over $20 million in the first year. (Hoshizaki, No. 86 at 
p. 7-8) Ice-O-Matic commented that DOE should directly consider the 
capital expenditures associated with tooling changes as it is a 
discrete expense that is not planned from year to year. (Ice-O-Matic, 
Public Meeting Transcript, No. 70 at p. 88)
    As suggested by Ice-O-Matic, DOE does consider conversion expenses 
to be one-time expenditures that are not planned from year-to-year. DOE 
models conversion investments, including capital expenditures, as 
occurring between the announcement year and standards year. These 
investments result in decreases in operating profit, free cash flow, 
and INPV. DOE's conversion cost estimates account for all production 
line modifications associated with the design options considered in the 
engineering analysis including changes in conveyor, equipment, and 
tooling. For the final rule, DOE made changes to the considered design 
options based on feedback from the industry. DOE believes the changes 
in design options will reduce the capital requirements on industry.
    Several manufacturers noted that a significant portion of their 
product lines would require redesign in order to meet the standard 
levels proposed in the NOPR. Specifically, Manitowoc commented that 90% 
of its models would require a major redesign to meet the proposed 
standards. (Manitowoc, No. 92 at p. 2-3) Similarly, Hoshizaki commented 
that about 80% of their continuous type units would not be able to meet 
the proposed standards. (Hoshizaki, Public Meeting Transcript, No. 70 
at p. 74) Hoshizaki noted in a written comment that over 75% of units 
on the market will be unable to meet the proposed standard. (Hoshizaki, 
No. 86 at p. 1) Scotsman commented that 97% of their product line would 
need to be replaced in order to achieve the proposed efficiency levels. 
(Scotsman, No. 85 at p. 2b) Emerson estimated 70% of the batch ice 
machines would need some amount of redesign in order to meet the 
proposed minimum efficiency levels at the NOPR stage. (Emerson, No. 122 
at p. 1) AHRI commented that 99% of the existing batch type market 
would be eliminated if the proposed TSL 3 became effective and that the 
impact of NOPR TSL 3 would lead to industry consolidation, loss of 
jobs, and loss of

[[Page 4709]]

international sales. (AHRI, No. 93 at p. 10-12) NAFEM noted general 
concerns about product obsolescence at the NOPR levels. (NAFEM, No. 82 
at p. 2)
    Between the NOPR and the Final Rule, DOE revised and updated its 
analysis based on stakeholders comments received at the NOPR public 
meeting, in additional manufacturer interviews, and in written 
responses to the NOPR and NODA. These updates included changes in its 
approach to calculating the energy use associated with groups of design 
options, changes in inputs for calculations of energy use and equipment 
manufacturing cost, and consideration of space-constrained 
applications. In response to the NOPR and NODA comments, DOE adjusted 
the design options it considered to reduce impacts on the industry. A 
discussion of these changes can be found in section IV.D.3. After 
applying the change to the analyses, the efficiency levels that DOE 
determined to be cost-effective changed considerably. These revised 
TSLs are presented in section V.A.
    When compared to the NOPR levels, DOE believes the revised levels 
proposed in section V.A will reduce the burdens on industry. Table 
IV.33 below presents the portion of model that DOE estimates would 
require redesign at the various final rule TSLs.

                  Table IV.33--Portion of Industry Models Requiring Redesign at Final Rule TSLs
----------------------------------------------------------------------------------------------------------------
                                                                    Percent of models failing at each TSL
----------------------------------------------------------------------------------------------------------------
                                                             TSL 1    TSL 2    TSL 3    TSL 4    TSL 5    Total
----------------------------------------------------------------------------------------------------------------
Batch.....................................................      27%      39%      51%      66%      84%     100%
Continuous................................................       29       41       55       55       78      100
                                                           -----------------------------------------------------
    Total.................................................       28       40       52       63       82      100
----------------------------------------------------------------------------------------------------------------

b. Cumulative Regulatory Burden
    NRA and NAFEM both commented that DOE should consider the impacts 
of the cumulative regulatory burden of rulemakings, including energy 
conservation standards for CRE and walk-in units as well as EPA 
rulemakings on refrigerants, and standards imposed nearly 
simultaneously on equipment manufacturers. (NRA, No. 69 at pp. 3-4) 
(NAFEM, No. 82 at pp. 6-7)
    DOE is instructed to consider all Federal, product-specific burdens 
that go into effect within 3 years of the compliance date of this final 
rule. The list of other standards considered in the cumulative 
regulatory burden analysis can be found in section V.B.2.g. DOE has 
included the energy conservation standard final rules for walk-in 
coolers and freezers final rule and the commercial refrigeration 
equipment final rule. DOE has not included the EPA SNAP rulemaking in 
this analysis. Because that rulemaking is in the NOPR stage and is not 
finalized at this time, any estimation of the impact or effective dates 
would be speculative.
c. SNAP and Compliance Date Considerations
    AHRI stated that the burden imposed by a potential changes in 
refrigerants is significant and will require major redesign just to 
maintain current efficiency levels. (AHRI, No. 168 at p. 5) AHRI urged 
DOE to extend the compliance period to five years or put a hold on the 
ACIM standards rulemaking until the SNAP refrigerants are finalized in 
order to avoid another redesign during the compliance period of the 
amended ACIM energy conservation standard. (AHRI, No. 70 at p. 16) 
Emerson also supported the idea of DOE starting the three-year 
compliance period after EPA finalizes a decision on refrigerants, 
allowing manufactures of components and equipment to re-design for both 
energy efficiency and low-GWP refrigerants in one design cycle. 
(Emerson, No. 122 at p.1) Ice-O-Matic proposed either a five year 
compliance period for the NODA TSL 3 or that DOE chose a lower standard 
level. (Ice-O-Matic, No. 121 at p. 2) Manitowoc stated that commercial 
ice makers are not within the current scope of the SNAP NOPR, however 
it believes that ice makers could be affected by a subsequent 
rulemaking. Furthermore, Manitowoc noted that even if there is no 
action on ice makers, the component suppliers to the ice maker industry 
(including suppliers of compressors, expansion valves, and heat 
exchangers) will be focusing their efforts on supporting the transition 
to SNAP refrigerants. Consequently, the commercial ice maker industry 
will be affected even if it is not directly covered by EPA rules. 
Manitowoc also supported a course of action to reduce the risk of 
multiple redesigns due to the refrigerant changes and an amended energy 
conservation standard. (Manitowoc, No. 126 at p. 3) NEEA expressed 
their support for DOE's current refrigerant-neutral position. (NEEA, 
No. 91 at p. 2)
    Since the SNAP rulemaking is in the NOPR stage and not finalized at 
this time, any estimation of the impact or effectives dates would be 
speculative, however in its August 6, 2014 proposal, EPA did not list 
ACIM as a product that would be impacted by forthcoming regulations (82 
FR 46126). DOE cannot speculate on the outcome of a rulemaking in 
progress and can only consider in its rulemakings regulations that are 
currently in effect. Therefore, DOE has not included possible outcomes 
of a potential EPA SNAP rulemaking.
    In response to the request that DOE extend the compliance date 
period for automatic commercial ice makers beyond the 3 years specified 
by the NOPR, as stated in section IV.A.2, DOE has determined that the 3 
year compliance period is adequate and is not extending the compliance 
date for ACIMs. In response to AHRI's comment that DOE should put a 
hold on the ACIM standards rulemaking until the SNAP refrigerants are 
finalized, EPCA prescribes that DOE must issue a final rule 
establishing energy conservation standards for automatic commercial ice 
makers not later than January 1, 2015 and DOE does not have the 
authority to alter this statutory mandate. (42 U.S.C. 6313(d)(3))
d. ENERGY STAR
    Manitowoc and Hoshizaki noted that the proposed standard bypasses 
the ENERGY STAR level (Manitowoc, Public Meeting Transcript, No. 70 at 
p. 74; Hoshizaki, No. 86 at p. 1) Manitowoc expressed concern that, if 
efficiency standards were raised to the level proposed in the NOPR, 
there would be no more room for an ENERGY STAR category, which would be 
disruptive to the industry. (Manitowoc, Public Meeting Transcript, No. 
70 at p. 74)
    DOE acknowledges the importance of the ENERGY STAR program and of 
understanding its interaction with

[[Page 4710]]

energy efficiency standards. However, EPCA requires DOE to establish 
energy conservation standards at the maximum level that is 
technologically feasible and economically justified. The standard level 
considered in this final rule is estimated to reduce cumulative source 
energy usage by 8% percent over the baseline, for products purchased in 
2018-2047. Comparatively, the max-tech level is estimated to reduce 
cumulative source energy usage by 14% percent over the baseline for the 
same time period (refer to section V.B.3 for a complete discussion of 
energy savings). As such, the standard level continues to leave room 
for ENERGY STAR rebate programs, and therefore new ENERGY STAR levels 
could be reestablished once compliance with these standards is 
required.
e. Request for DOE and EPA Collaboration
    Hoshizaki commented that during a previous round of refrigerant 
changeovers, it took over five years to make the appropriate changes to 
their product line and that it would take even longer this time due to 
the highly flammable refrigerant alternatives under consideration that 
would require additional redesign work. Hoshizaki requested that DOE 
and EPA work together to ensure that manufacturers are not unduly 
burdened with standards from both agencies. (Hoshizaki, No. 86 at p. 6-
7)
    DOE recognizes that the combined effects of recent or impending 
regulations may have serious consequences for some manufacturers, 
groups of manufacturers, or an entire industry. As such, DOE conducts 
an analysis of the cumulative regulatory burden as part of its 
rulemakings pertaining to equipment efficiency. As stated previously, 
however, DOE cannot speculate on the outcome of a rulemaking in 
progress and can only consider in its rulemakings regulations that are 
currently in effect. If a manufacturer believes that its design is 
subjected to undue hardship by regulations, the manufacturer may 
petition DOE's Office of Hearing and Appeals (OHA) for exception relief 
or exemption from the standard pursuant to OHA's authority under 
section 504 of the DOE Organization Act (42 U.S.C. 7194), as 
implemented at subpart B of 10 CFR part 1003. OHA has the authority to 
grant such relief on a case-by-case basis if it determines that a 
manufacturer has demonstrated that meeting the standard would cause 
hardship, inequity, or unfair distribution of burdens.
f. Compliance With Refrigerant Changes Could Be Difficult
    NAFEM commented that municipal and state regulations and codes may 
make it difficult to comply with proposed EPA refrigerant regulations 
in some localities and could create hardship for manufacturers. (NAFEM, 
No. 82 at p. 7)
    This comment relates to proposed EPA refrigerant regulations, and 
is beyond the scope of this rulemaking. DOE has forwarded the comment 
to EPA's Stratospheric Protection Division.
g. Small Manufacturers
    NAFEM notes that the proposed rule has a disparate impact on small 
businesses because commercial ice makers are largely manufactured by 
small businesses. (NAFEM, No. 82 at p. 5) AHRI agreed that this 
rulemaking has impacts on small businesses and requested DOE account 
for all small ACIM manufacturers. (AHRI, No. 93 at p. 12)
    DOE recognizes the potential for this rule to affect small 
businesses. As a result, DOE presented a small business manufacturer 
sub-group analysis in the NOPR stage and in this final rule notice. DOE 
used industry trade association membership directories, public product 
databases, individual company Web sites, and other market research 
tools to establish a draft list of covered small manufacturers. DOE 
presented its draft list of covered small manufacturers to stakeholders 
and industry representatives and asked if they were aware of any other 
small manufacturers that should be added to the list during 
manufacturer interviews and at DOE public meetings. DOE identified 
seven small manufacturers at the NOPR stage. Stakeholders did not 
provide any information in interviews or comments that identified 
additional small manufacturers of automatic commercial ice makers. As 
discussed in section VI.B, DOE applied the small business size 
standards published by the SBA to determine whether a company is 
considered a small manufacturer. The SBA defines a small business for 
NAICS 333415 ``Air-Conditioning and Warm Air Heating Equipment and 
Commercial and Industrial Refrigeration Equipment Manufacturing'' as 
having 750 or fewer employees. The 750-employee threshold includes all 
employees in a business's parent company and any other subsidiaries. 
Given the lack of additional new information, DOE maintains that there 
are seven small business manufacturers of the covered product in the 
Final Regulatory Flexibility Analysis, found in section VI.B.
    NAFEM did not provide any data supporting the suggestion that the 
majority of domestic ice maker sales are from small manufacturers. 
Based on a 2008 study by Koeller & Company,\55\ DOE understands that 
the ACIM market is dominated by four manufacturers who produce 
approximately 90 percent of the automatic commercial ice makers for 
sale in the United States. The four major manufacturers with the 
largest market share are Manitowoc, Scotsman, Hoshizaki, and Ice-O-
Matic; none of which are consider small business manufacturers. The 
remaining 12 large and small manufacturers account for ten percent of 
domestic sales. Thus, DOE disagrees with NAFEM's statement that a 
majority of sales are from small manufacturers.
---------------------------------------------------------------------------

    \55\ Koeller, John, P.E., and Herman Hoffman, P.E. A Report on 
Potential Best Management Practices. Rep. The California Urban Water 
Conservation Council, n.d. Web. 19 May 2014.
---------------------------------------------------------------------------

h. Large Manufacturers
    Scotsman commented that DOE's INPV analysis ignores manufacturers' 
current financial stability and noted that the impacts on large 
manufacturers could be significantly more severe than the average. 
(Scotsman, No. 85 at p.6b)
    The MIA does not forecast the financial stability of individual 
manufacturers. The MIA is an industry-level analysis. Inherent to this 
analysis is that fact that not all industry participants will perform 
equally.
i. Negative Impact on Market Growth
    Follett and Hoshizaki commented that more stringent standards have 
an adverse impact on innovation and development of new products. 
Follett commented that DOE's analysis must account for the lost 
opportunity to initiate growth projects that would expand the market. 
(Follett, No. 84 at p.10) (Hoshizaki, No.86 at p.4) NRA commented that 
the cost of R&D would be passed on to end-users, causing them to delay 
purchasing new equipment and thus negatively affecting the ice machine 
industry. (NRA, No. 69 at p. 4)
    The MIA uses the annual shipments forecast from the Shipment's 
Analysis as an input in the GRIM. The Shipments Analysis provides the 
base case shipments as well as standards case shipments. The analysis 
uses data from AHRI, ENERGY STAR, and U.S. Census Bureau's Current 
Industrial Reports (CIR) to estimate historical shipments for automatic 
commercial ice makers. Future shipments are broken down into 
replacement units based on a stock accounting model; new sales based on

[[Page 4711]]

projections of new construction activity from AEO2014. More detail on 
this methodology can be found in section IV.H.1. DOE's analysis does 
not speculate on additional shipments that are the result of ``growth 
projects.'' Manufacturers did not provide estimations of these growth 
levels or justification for such growth levels. Thus, DOE was not able 
to include such growth factors in its models.
j. Negative Impact on Non-U.S. Sales
    Follett added that the additional cost of efficient components 
would impact non-U.S. sales. (Follett, No. 84 at p.7) Ice-O-Matic 
commented that they can't afford designs that can only be sold in North 
America and that they will lose global busines. (Ice-O-Matic, No. 70 at 
p.308) Scotsman stated it will be a challenge to meet DOE efficiency 
thresholds, the EPA SNAP regulations and EU regulations with common 
equipment platforms. Scotsman continued that the regulations will make 
it difficult for domestic manufacturers to compete in the global 
market, where the customers' primary decision criterion is sales price. 
(Scotsman, No.125 at p. 2-3) Scotsman requested DOE's analysis account 
for the impact that regulations will have on manufacturers' ability to 
compete in a global market against cheaper products not governed by DOE 
standards. (Scotsman, No.70 at p.43-44)
    The standards in this final rule only cover equipment placed into 
commerce in the domestic market, and as such, do not restrict 
manufacturers from selling products below the new and amended standards 
in foreign markets. DOE notes that manufacturers make products today 
that meet the standard set by the 2005 energy conservation standard for 
automatic commercial ice makers and are able to compete against 
manufacturers with production lines in lower cost countries. In their 
comments, manufacturers did not provide any information as to which 
product models or which efficiencies are sold into international 
markets. If the models sold internationally have efficiencies that 
exceed the amended standard, then manufacturers will likely see a 
production cost decrease as sales roll-up to the new standard and 
production volumes increase. It is also possible that manufacturer 
production costs could increase marginally due to small production 
runs. However, stakeholders did not provide enough information for DOE 
to model the price-sensitivity of the foreign market.
k. Employment
    Ice-O-Matic commented that, if the market loses net present value, 
companies are not going to accept less profit, and so there's no way 
they can employ the same number of people unless they reduce their pay. 
(Ice-O-Matic, No. 70 at p.313) In the NOPR public meeting, AHRI, 
Scotsman, and Ice-o-matic noted concerns about DOE direct employment 
estimates being too low. (No. 70 at p.320-330)
    DOE analyzes the potential impacts of the energy conservation 
standard on direct production labor in section V.B.2.d. This analysis 
estimates the production head count, including production workers up to 
the line-supervisor level who are directly involved in fabricating and 
assembling a product within an original equipment manufacturer (OEM) 
facility. It does not account for sales, engineering, management, and 
all other workers who are not directly producing and assembling 
product. DOE presents an upper and lower bound for direct employment. 
DOE does not assert that employment will remain steady throughout the 
analysis period.
    In the NOPR, DOE clearly stated the assumptions that contributed to 
its estimate of direct production employment. These assumptions 
included: Unit sales, labor content per unit sold, average hourly wages 
for production workers, and annual hours worked by production workers. 
The calculation of production employment is discussed in detail in 
chapter 12 of the TSD, section 12.7. In the NOPR and NODA comments, DOE 
did not receive any comments on these key production employment 
assumptions. However, DOE updated its final rule analysis based on a 
revised engineering analysis, shipments analysis, and trial standard 
levels.
l. Compliance With 12866 and 13563
    NAFEM commented that DOE is in violation of Executive Orders 12866 
and 13563. (NAFEM, No. 82 at p.8) DOE has fulfilled the obligations 
required by Executive Orders 12866 and 13563. Additional information 
can be found in section VI of this preamble.
m. Warranty Claims
    Scotsman noted concern that the MIA results had not ``accurately 
accounted for warranty increases''. (Scotsman, No.125 at p.3) 
Specifically, it noted that an ECM condenser fan motor would cost 
significantly more than its current component.
    DOE did not explicitly factor in changes in warranty set-asides or 
payments. In interviews, DOE requested manufacturers highlight key 
concerns related to the rulemaking. Warranty concerns were not cited as 
a key issue. In order for DOE to account for changes in warranty costs, 
manufacturers would need to provide data on current product failure 
rates, causes of failure and related repair costs, expected future 
warranty rates, and changes in expected repair costs. Insufficient 
information was provided to model a change in warranty reserve and 
warranty pay out. Aside from the Scotsman data point on the cost of ECM 
fan motors, no other manufacturer supplied hard data related to 
warranty expenses. As a result, DOE did not incorporate a change in 
warranty rate in its analysis.
n. Impact to Suppliers, Distributors, Dealers, and Contractors
    AHRI commented that DOE must perform analyses to assess the impacts 
of the final rule on component suppliers, distributors, dealers, and 
contractors. Policy Analyst also suggested that DOE assess whether 
suppliers are affected by the proposed standard. (Policy Analyst, No. 
75 at p. 10) The MIA assesses the impact of amended energy conservation 
standards on manufacturers of automatic commercial ice makers. Analysis 
of the impacts on distributors, dealers, and contractors as a result of 
energy conservation standards on manufacturers of automatic commercial 
ice makers falls outside the scope of this analysis.
    Impacts on component suppliers might arise if manufacturers 
switched to more-efficient components, or if there was a substantial 
reduction in sales orders following new or amended standards. In public 
comments and in confidential interviews, manufacturers expressed that 
given their low production volumes, the automatic commercial ice maker 
manufacturing industry has little influence over component suppliers 
relative to other commercial refrigeration equipment industries. 
(Manitowoc, Preliminary Analysis Public Meeting Transcript, No. 42 at 
pp. 14-15). It follows that energy conservation standards for automatic 
commercial ice makers would have little impact on component suppliers 
given their marginal contribution to overall commercial refrigeration 
component demand.

K. Emissions Analysis

    In the emissions analysis, DOE estimated the reduction in power 
sector emissions of CO2, NOX, SO2, and 
Hg from potential energy conservation standards for automatic 
commercial ice

[[Page 4712]]

makers. In addition, DOE estimates emissions impacts in production 
activities (extracting, processing, and transporting fuels) that 
provide the energy inputs to power plants. These are referred to as 
``upstream'' emissions. Together, these emissions account for the full-
fuel-cycle (FFC). In accordance with DOE's FFC Statement of Policy (76 
FR 51282 (Aug. 18, 2011), 77 FR 49701 (Aug. 17, 2012)) the FFC analysis 
includes impacts on emissions of CH4 and N2O, 
both of which are recognized as greenhouse gases (GHGs).
    DOE primarily conducted the emissions analysis using emissions 
factors for CO2 and most of the other gases derived from 
data in the AEO2014. Combustion emissions of CH4 and 
N2O were estimated using emissions intensity factors 
published by the Environmental Protection Agency (EPA), GHG Emissions 
Factors Hub.\56\ DOE developed separate emissions factors for power 
sector emissions and upstream emissions. The method that DOE used to 
derive emissions factors is described in chapter 13 of the final rule 
TSD.
---------------------------------------------------------------------------

    \56\ http://www.epa.gov/climateleadership/inventory/ghg-emissions.html.
---------------------------------------------------------------------------

    For CH4 and N2O, DOE calculated emissions 
reduction in tons and also in terms of units of carbon dioxide 
equivalent (CO2eq). Gases are converted to CO2eq 
by multiplying the physical units by the gases' global warming 
potential (GWP) over a 100-year time horizon. Based on the Fourth 
Assessment Report of the Intergovernmental Panel on Climate Change,\57\ 
DOE used GWP values of 28 for CH4 and 265 for 
N2O.
---------------------------------------------------------------------------

    \57\ Intergovernmental Panel on Climate Change. Climate Change 
2013: The Physical Science Basis. Contribution of Working Group I to 
the Fifth Assessment Report of the Intergovernmental Panel on 
Climate Change. 2013. Stocker, T.F., D. Qin, G.-K. Plattner, M. 
Tignor, S.K. Allen, J. Boschung, A. Nauels, Y. Xia, V. Bex and P.M. 
Midgley (eds.). Cambridge University Press, Cambridge, United 
Kingdom and New York, NY, USA. Chapter 8.
---------------------------------------------------------------------------

    EIA prepares the AEO using NEMS. Each annual version of NEMS 
incorporates the projected impacts of existing air quality regulations 
on emissions. AEO2014 generally represents current legislation and 
environmental regulations, including recent government actions, for 
which implementing regulations were available as of October 31, 2013.
    SO2 emissions from affected electric generating units 
(EGUs) are subject to nationwide and regional emissions cap-and-trade 
programs. Title IV of the Clean Air Act sets an annual emissions cap on 
SO2 for affected EGUs in the 48 contiguous states and the 
District of Columbia (DC). SO2 emissions from 28 eastern 
States and DC were also limited under the Clean Air Interstate Rule 
(CAIR; 70 FR 25162 (May 12, 2005)), which created an allowance-based 
trading program that operates along with the Title IV program. CAIR was 
remanded to U.S. Environmental Protection Agency (EPA) by the U.S. 
Court of Appeals for the District of Columbia Circuit but it remained 
in effect.\58\ In 2011 EPA issued a replacement for CAIR, the Cross-
State Air Pollution Rule (CSAPR). 76 FR 48208 (August 8, 2011). On 
August 21, 2012, the D.C. Circuit issued a decision to vacate 
CSAPR.\59\ The court ordered EPA to continue administering CAIR. The 
emissions factors used for this final rule, which are based on AEO2014, 
assume that CAIR remains a binding regulation through 2040.\60\
---------------------------------------------------------------------------

    \58\ See North Carolina v. EPA, 550 F.3d 1176 (D.C. Cir. 2008); 
North Carolina v. EPA, 531 F.3d 896 (D.C. Cir. 2008).
    \59\ See EME Homer City Generation, LP v. EPA, 696 F.3d 7, 38 
(D.C. Cir. 2012).
    \60\ On April 29, 2014, the U.S. Supreme Court reversed the 
judgment of the D.C. Circuit and remanded the case for further 
proceedings consistent with the Supreme Court's opinion. The Supreme 
Court held in part that EPA's methodology for quantifying emissions 
that must be eliminated in certain states due to their impacts in 
other downwind states was based on a permissible, workable, and 
equitable interpretation of the Clean Air Act provision that 
provides statutory authority for CSAPR. See EPA v. EME Homer City 
Generation, No 12-1182, slip op. at 32 (U.S. April 29, 2014). 
Because DOE is using emissions factors based on AEO2014 for today's 
final rule, the analysis assumes that CAIR, not CSAPR, is the 
regulation in force. The difference between CAIR and CSAPR is not 
relevant for the purpose of DOE's analysis of SO2 
emissions.
---------------------------------------------------------------------------

    The attainment of emissions caps is typically flexible among EGUs 
and is enforced through the use of emissions allowances and tradable 
permits. Under existing EPA regulations, any excess SO2 
emissions allowances resulting from the lower electricity demand caused 
by the adoption of an efficiency standard could be used to permit 
offsetting increases in SO2 emissions by any regulated EGU. 
In past rulemakings, DOE recognized that there was uncertainty about 
the effects of efficiency standards on SO2 emissions covered 
by the existing cap-and-trade system, but it concluded that negligible 
reductions in power sector SO2 emissions would occur as a 
result of standards.
    Beginning in 2016, however, SO2 emissions will fall as a 
result of the Mercury and Air Toxics Standards (MATS) for power plants. 
77 FR 9304 (Feb. 16, 2012). In the final MATS rule, EPA established a 
standard for hydrogen chloride as a surrogate for acid gas hazardous 
air pollutants (HAP) and also established a standard for SO2 
(a non-HAP acid gas) as an alternative equivalent surrogate standard 
for acid gas HAP. The same controls are used to reduce HAP and non-HAP 
acid gas; thus, SO2 emissions will be reduced as a result of 
the control technologies installed on coal-fired power plants to comply 
with the MATS requirements for acid gas. AEO2014 assumes that, in order 
to continue operating, coal plants must have either flue gas 
desulfurization or dry sorbent injection systems installed by 2016. 
Both technologies are used to reduce acid gas emissions, and also 
reduce SO2 emissions. Under the MATS, emissions will be far 
below the cap established by CAIR, so it is unlikely that excess 
SO2 emissions allowances resulting from the lower 
electricity demand would be needed or used to permit offsetting 
increases in SO2 emissions by any regulated EGU. Therefore, 
DOE believes that efficiency standards will reduce SO2 
emissions in 2016 and beyond.
    CAIR established a cap on NOX emissions in 28 eastern 
States and the District of Columbia.\61\ Energy conservation standards 
are expected to have little effect on NOX emissions in those 
States covered by CAIR because excess NOX emissions 
allowances resulting from the lower electricity demand could be used to 
permit offsetting increases in NOX emissions. However, 
standards would be expected to reduce NOX emissions in the 
States not affected by the caps, so DOE estimated NOX 
emissions reductions from the standards considered in this final rule 
for these States.
---------------------------------------------------------------------------

    \61\ CSAPR also applies to NOX and it would supersede 
the regulation of NOX under CAIR. As stated previously, 
the current analysis assumes that CAIR, not CSAPR, is the regulation 
in force. The difference between CAIR and CSAPR with regard to DOE's 
analysis of NOX emissions is slight.
---------------------------------------------------------------------------

    The MATS limit mercury emissions from power plants, but they do not 
include emissions caps and, as such, DOE's energy conservation 
standards would likely reduce Hg emissions. DOE estimated mercury 
emissions reduction using emissions factors based on AEO2014, which 
incorporates the MATS.
    In response to the NOPR, DOE received one comment specifically 
about measuring environmental benefits. Policy Analyst stated that DOE 
should commit to measuring environmental benefits and reductions in 
energy usage as a result of these standards. (Policy Analyst, No. 75 at 
p. 10) DOE has invested a great deal of time and effort in quantifying 
the energy reductions and environmental benefits of this rule, as 
described in this section and as described in the discussion of the

[[Page 4713]]

NIA (IV.H). Given the dispersed nature of automatic commercial ice 
makers on customer premises across the country, actual physical 
measurement of the energy savings and environmental benefits would be a 
large and costly undertaking which would likely not yield useful 
results. However, DOE is committed to working with other governmental 
agencies to continue developing tools for quantifying the environmental 
benefits of proceedings such as this ACIM rulemaking. The discussion 
that follows of the development of the social cost of carbon (SCC) is 
the prime example of these efforts.

L. Monetizing Carbon Dioxide and Other Emissions Impacts

    As part of the development of the standards in this final rule, DOE 
considered the estimated monetary benefits from the reduced emissions 
of CO2 and NOX that are expected to result from 
each of the TSLs considered. In order to make this calculation similar 
to the calculation of the NPV of consumer benefit, DOE considered the 
reduced emissions expected to result over the lifetime of equipment 
shipped in the forecast period for each TSL. This section summarizes 
the basis for the monetary values used for each of these emissions and 
presents the values considered in this rulemaking.
    For this final rule, DOE is relying on a set of values for the 
social cost of carbon (SCC) that was developed by an interagency 
process. The basis for these values is summarized below, and a more 
detailed description of the methodologies used is provided as an 
appendix to chapter 14 of the final rule TSD.
1. Social Cost of Carbon
    The SCC is an estimate of the monetized damages associated with an 
incremental increase in carbon emissions in a given year. It is 
intended to include (but is not limited to) changes in net agricultural 
productivity, human health, property damages from increased flood risk, 
and the value of ecosystem services. Estimates of the SCC are provided 
in dollars per metric ton of CO2. A domestic SCC value is 
meant to reflect the value of damages in the United States resulting 
from a unit change in CO2 emissions, while a global SCC 
value is meant to reflect the value of damages worldwide.
    Under section 1(b) of Executive Order 12866, agencies must, to the 
extent permitted by law, ``assess both the costs and the benefits of 
the intended regulation and, recognizing that some costs and benefits 
are difficult to quantify, propose or adopt a regulation only upon a 
reasoned determination that the benefits of the intended regulation 
justify its costs.'' The purpose of the SCC estimates presented here is 
to allow agencies to incorporate the monetized social benefits of 
reducing CO2 emissions into cost-benefit analyses of 
regulatory actions. The estimates are presented with an acknowledgement 
of the many uncertainties involved and with a clear understanding that 
they should be updated over time to reflect increasing knowledge of the 
science and economics of climate impacts.
    As part of the interagency process that developed these SCC 
estimates, technical experts from numerous agencies met on a regular 
basis to consider public comments, explore the technical literature in 
relevant fields, and discuss key model inputs and assumptions. The main 
objective of this process was to develop a range of SCC values using a 
defensible set of input assumptions grounded in the existing scientific 
and economic literatures. In this way, key uncertainties and model 
differences transparently and consistently inform the range of SCC 
estimates used in the rulemaking process.
a. Monetizing Carbon Dioxide Emissions
    When attempting to assess the incremental economic impacts of 
CO2 emissions, the analyst faces a number of serious 
challenges. A report from the National Research Council \62\ points out 
that any assessment will suffer from uncertainty, speculation, and lack 
of information about (1) future emissions of greenhouse gases, (2) the 
effects of past and future emissions on the climate system, (3) the 
impact of changes in climate on the physical and biological 
environment, and (4) the translation of these environmental impacts 
into economic damages. As a result, any effort to quantify and monetize 
the harms associated with climate change will raise serious questions 
of science, economics, and ethics and should be viewed as provisional.
---------------------------------------------------------------------------

    \62\ National Research Council. Hidden Costs of Energy: Unpriced 
Consequences of Energy Production and Use. National Academies Press: 
Washington, DC (2009).
---------------------------------------------------------------------------

    Despite the limits of both quantification and monetization, SCC 
estimates can be useful in estimating the social benefits of reducing 
CO2 emissions. The agency can estimate the benefits from 
reduced (or costs from increased) emissions in any future year by 
multiplying the change in emissions in that year by the SCC value 
appropriate for that year. The net present value of the benefits can 
then be calculated by multiplying each of these future benefits by an 
appropriate discount factor and summing across all affected years.
    It is important to emphasize that the interagency process is 
committed to updating these estimates as the science and economic 
understanding of climate change and its impacts on society improves 
over time. In the meantime, the interagency group will continue to 
explore the issues raised by this analysis and consider public comments 
as part of the ongoing interagency process.
b. Development of Social Cost of Carbon Values
    In 2009, an interagency process was initiated to offer a 
preliminary assessment of how best to quantify the benefits from 
reducing CO2 emissions. To ensure consistency in how 
benefits are evaluated across agencies, the Administration sought to 
develop a transparent and defensible method, specifically designed for 
the rulemaking process, to quantify avoided climate change damages from 
reduced CO2 emissions. The interagency group did not 
undertake any original analysis. Instead, it combined SCC estimates 
from the existing literature to use as interim values until a more 
comprehensive analysis could be conducted. The outcome of the 
preliminary assessment by the interagency group was a set of five 
interim values: global SCC estimates for 2007 (in 2006$) of $55, $33, 
$19, $10, and $5 per metric ton of CO2. These interim values 
represented the first sustained interagency effort within the U.S. 
government to develop an SCC for use in regulatory analysis. The 
results of this preliminary effort were presented in several proposed 
and final rules.
c. Current Approach and Key Assumptions
    Since the release of the interim values, the interagency group 
reconvened on a regular basis to generate improved SCC estimates. 
Specifically, the group considered public comments and further explored 
the technical literature in relevant fields. The interagency group 
relied on three integrated assessment models commonly used to estimate 
the SCC: the FUND, DICE, and PAGE models. These models are frequently 
cited in the peer-reviewed literature and were used in the last 
assessment of the Intergovernmental Panel on Climate Change. Each model 
was given equal weight in the SCC values that were developed.
    Each model takes a slightly different approach to model how changes 
in

[[Page 4714]]

emissions result in changes in economic damages. A key objective of the 
interagency process was to enable a consistent exploration of the three 
models while respecting the different approaches to quantifying damages 
taken by the key modelers in the field. An extensive review of the 
literature was conducted to select three sets of input parameters for 
these models: climate sensitivity, socio-economic and emissions 
trajectories, and discount rates. A probability distribution for 
climate sensitivity was specified as an input into all three models. In 
addition, the interagency group used a range of scenarios for the 
socio-economic parameters and a range of values for the discount rate. 
All other model features were left unchanged, relying on the model 
developers' best estimates and judgments.
    The interagency group selected four sets of SCC values for use in 
regulatory analyses. Three sets of values are based on the average SCC 
from the three integrated assessment models, at discount rates of 2.5, 
3, and 5 percent. The fourth set, which represents the 95th percentile 
SCC estimate across all three models at a 3-percent discount rate, is 
included to represent higher-than-expected impacts from temperature 
change further out in the tails of the SCC distribution. The values 
grow in real terms over time. Additionally, the interagency group 
determined that a range of values from 7 percent to 23 percent should 
be used to adjust the global SCC to calculate domestic effects, 
although preference is given to consideration of the global benefits of 
reducing CO2 emissions. Table IV.34 presents the values in 
the 2010 interagency group report,\63\ which is reproduced in appendix 
14A of the TSD.
---------------------------------------------------------------------------

    \63\ Social Cost of Carbon for Regulatory Impact Analysis Under 
Executive Order 12866. Interagency Working Group on Social Cost of 
Carbon, United States Government, February 2010. www.whitehouse.gov/sites/default/files/omb/inforeg/for-agencies/Social-Cost-of-Carbon-for-RIA.pdf.

                     Table IV.34--Annual SCC Values From 2010 Interagency Report, 2010-2050
                                        [2007 dollars per metric ton CO2]
----------------------------------------------------------------------------------------------------------------
                                                                         Discount rate (%)
                                                 ---------------------------------------------------------------
                                                         5               3              2.5              3
                      Year                       ---------------------------------------------------------------
                                                                                                       95th
                                                      Average         Average         Average       percentile
----------------------------------------------------------------------------------------------------------------
2010............................................             4.7            21.4            35.1            64.9
2015............................................             5.7            23.8            38.4            72.8
2020............................................             6.8            26.3            41.7            80.7
2025............................................             8.2            29.6            45.9            90.4
2030............................................             9.7            32.8            50.0           100.0
2035............................................            11.2            36.0            54.2           109.7
2040............................................            12.7            39.2            58.4           119.3
2045............................................            14.2            42.1            61.7           127.8
2050............................................            15.7            44.9            65.0           136.2
----------------------------------------------------------------------------------------------------------------

    The SCC values used for this rulemaking were generated using the 
most recent versions of the three integrated assessment models that 
have been published in the peer-reviewed literature.\64\ (See appendix 
14-B of the final rule TSD for further information.) Table IV.35 shows 
the updated sets of SCC estimates in 5-year increments from 2010 to 
2050. The full set of annual SCC estimates between 2010 and 2050 is 
reported in appendix 14-B of the final rule TSD. The central value that 
emerges is the average SCC across models at the 3-percent discount 
rate. However, for purposes of capturing the uncertainties involved in 
regulatory impact analysis, the interagency group emphasizes the 
importance of including all four sets of SCC values.
---------------------------------------------------------------------------

    \64\ Technical Update of the Social Cost of Carbon for 
Regulatory Impact Analysis Under Executive Order 12866. Interagency 
Working Group on Social Cost of Carbon, United States Government. 
May 2013; revised November 2013. www.whitehouse.gov/sites/default/files/omb/assets/inforeg/technical-update-social-cost-of-carbon-for-regulator-impact-analysis.pdf

                     Table IV.35--Annual SCC Values From 2013 Interagency Update, 2010-2050
                                        [2007 dollars per metric ton CO2]
----------------------------------------------------------------------------------------------------------------
                                                                         Discount rate (%)
                                                 ---------------------------------------------------------------
                                                         5               3              2.5              3
                      Year                       ---------------------------------------------------------------
                                                                                                       95th
                                                      Average         Average         Average       Percentile
----------------------------------------------------------------------------------------------------------------
2010............................................              11              32              51              89
2015............................................              11              37              57             109
2020............................................              12              43              64             128
2025............................................              14              47              69             143
2030............................................              16              52              75             159
2035............................................              19              56              80             175
2040............................................              21              61              86             191
2045............................................              24              66              92             206
2050............................................              26              71              97             220
----------------------------------------------------------------------------------------------------------------

[[Page 4715]]

    It is important to recognize that a number of key uncertainties 
remain and that current SCC estimates should be treated as provisional 
and revisable since they will evolve with improved scientific and 
economic understanding. The interagency group also recognizes that the 
existing models are imperfect and incomplete. The National Research 
Council report mentioned in section IV.L.1.a points out that there is 
tension between the goal of producing quantified estimates of the 
economic damages from an incremental ton of carbon and the limits of 
existing efforts to model these effects. There are a number of analytic 
challenges that are being addressed by the research community, 
including research programs housed in many of the Federal agencies 
participating in the interagency process to estimate the SCC. The 
interagency group intends to periodically review and reconsider those 
estimates to reflect increasing knowledge of the science and economics 
of climate impacts, as well as improvements in modeling.
    In summary, in considering the potential global benefits resulting 
from reduced CO2 emissions, DOE used the values from the 
2013 interagency report adjusted to 2013$ using the Gross Domestic 
Product price deflator. For each of the four cases of SCC values, the 
values for emissions in 2015 were $12.0, $40.5, $62.4, and $119 per 
metric ton of CO2 avoided. DOE derived values after 2050 
using the relevant growth rates for the 2040-2050 period in the 
interagency update.
    DOE multiplied the CO2 emissions reduction estimated for 
each year by the SCC value for that year in each of the four cases. To 
calculate a present value of the stream of monetary values, DOE 
discounted the values in each of the four cases using the specific 
discount rate that had been used to obtain the SCC values in each case.
    In responding to the NOPR, many commenters questioned why DOE 
quantified the emissions. Commenters also questioned the scientific and 
economic basis of the SCC values.
    Scotsman stated they did not understand the logic of predicting 
emissions reductions associated with a product with such a limited 
population relative to national average energy consumption. (Scotsman, 
No. 95 at page 7) As stated earlier in the SCC discussion, DOE 
quantifies emissions reductions as one of the societal impacts of all 
standards in accordance with section 1(b) of Executive Order 12866.
    A number of stakeholders stated that DOE should not use SCC values 
to establish monetary figures for emissions reductions until the SCC 
undergoes a more rigorous notice, review, and comment process. (AHRI, 
No. 93 at pp. 13-14; The Associations, No. 77 at p. 4) The Cato 
Institute commented that SCC should be barred from use until its 
deficiencies are rectified. (Cato Institute, No. 74 at p. 1) Similarly, 
IER stated that SCC should no longer be used in Federal regulatory 
analysis and rulemakings. (IER, No. 83 at p. 2) In contrast, IPI et al. 
affirmed that current SCC values are sufficiently robust and accurate 
for continued use in regulatory analyses. (IPI, No. 78 at p. 1)
    In conducting the interagency process that developed the SCC 
values, technical experts from numerous agencies met on a regular basis 
to consider public comments, explore the technical literature in 
relevant fields, and discuss key model inputs and assumptions. Key 
uncertainties and model differences transparently and consistently 
inform the range of SCC estimates. These uncertainties and model 
differences are discussed in the interagency working group's reports, 
which are reproduced in appendix 14A and 14B of the TSD, as are the 
major assumptions. The 2010 SCC values have been used in a number of 
Federal rulemakings upon which the public had opportunity to comment. 
In November 2013, the OMB announced a new opportunity for public 
comment on the TSD underlying the revised SCC estimates. See 78 FR 
70586 (Nov. 26, 2013). OMB is currently reviewing comments and 
considering whether further revisions to the 2013 SCC estimates are 
warranted. DOE stands ready to work with OMB and the other members of 
the interagency working group on further review and revision of the SCC 
estimates as appropriate.
    IER commented that the SCC is inappropriate for use in federal 
rulemakings because it is based on subjective modeling decisions rather 
than objective observations and because it violates OMB guidelines for 
accuracy, reliability, and freedom from bias. (IER, No. 83 at p. 2) The 
General Accounting Office (GAO) was asked to review the Interagency 
Working Group's (IWG) development of SCC estimates,\65\ and noted that 
OMB and EPA participants reported that the IWG documented all major 
issues consistent with Federal standards for internal control. The GAO 
also found, according to its document review and interviews, that the 
IWG's development process followed three principles: (1) It used 
consensus-based decision making; (2) it relied on existing academic 
literature and models; and (3) it took steps to disclose limitations 
and incorporate new information. Further, DOE has sought to ensure that 
the data and research used to support its policy decisions--including 
the SCC values--are of high scientific and technical quality and 
objectivity, as called for by the Secretarial Policy Statement on 
Scientific Integrity.\66\ See section VI.L for DOE's evaluation of this 
final rule and supporting analyses under the DOE and OMB information 
quality guidelines.
---------------------------------------------------------------------------

    \65\ www.directives.doe.gov/directives-documents/400-series/0411.2-APolicy.
    \66\ www.gao.gov/products/GAO-14-663.
---------------------------------------------------------------------------

    The Cato Institute stated that the determination of the SCC is 
discordant with the best scientific literature on the equilibrium 
climate sensitivity and the fertilization effect of CO2--two 
critically important parameters for establishing the net externality of 
CO2 emissions. (Cato Institute, No. 74 at pp. 1, 12-15) The 
revised estimates that were issued in November 2013 are based on the 
best available scientific information on the impacts of climate change. 
The issue of equilibrium climate sensitivity is addressed in section 
14A.4 of appendix 14A in the TSD. The EPA, in collaboration with other 
Federal agencies, continues to investigate potential improvements to 
the way in which economic damages associated with changes in 
CO2 emissions are quantified.
    AHRI commented that the GHG emissions reductions benefits may be 
overestimated because the DOE's analysis does not take into 
consideration EPA's planned regulation of GHG emissions from power 
plants, which would affect the estimated carbon emissions. AHRI 
suggested DOE conduct additional research on the impact of EPA's 
regulations on SCC values. (AHRI, No. 93 at p. 14) As noted in section 
IV.L.1, DOE participates in the IWG process. DOE believes that if 
necessary and appropriate the IWG will perform research as suggested by 
AHRI, but notes that results from any such research will not be timely 
for inclusion in this rulemaking. With respect to AHRI's comment about 
accounting for EPA's planned regulations, DOE cannot account for 
regulations that are not currently in effect because whether such 
regulations will be adopted and their final form are matters of 
speculation at this time.
    The Cato Institute commented that the IWG appears to violate the 
directive in OMB Circular A-4, which states, ``Your analysis should 
focus on benefits and costs that accrue to citizens and residents of 
the United States. Where you choose to evaluate a regulation that

[[Page 4716]]

is likely to have effects beyond the borders of the United States, 
these effects should be reported separately.'' The Cato Institute 
stated that instead of focusing on domestic benefits and separately 
reporting any international effects, the IWG only reports the global 
costs and makes no determination of the domestic costs. (Cato 
Institute, No. 74 at pp. 2-3) IER expressed similar concerns about the 
IWG's use of a global perspective in reporting SCC estimates. (IER, No. 
83 at pp. 16-17) AHRI commented that either domestic or global costs 
and benefits should be considered, but not both. (AHRI, No. 93 at p. 
14)
    Although the relevant analyses address both domestic and global 
impacts, the interagency group has determined that it is appropriate to 
focus on a global measure of SCC because of the distinctive nature of 
the climate change problem, which is highly unusual in at least two 
respects. First, it involves a global externality: Emissions of most 
greenhouse gases contribute to damages around the world when they are 
emitted in the United States. Second, climate change presents a problem 
that the United States alone cannot solve. The issue of global versus 
domestic measures of the SCC is further discussed in appendix 14A of 
the TSD.
    AHRI stated that the costs of the proposed rule are calculated over 
the course of a 30-year period, while avoided SCC benefit is calculated 
over a 300-year period. AHRI further commented that longer-term (i.e., 
30-300 years) impacts of regulations on businesses are unknown, and 
should be studied. (AHRI, No. 93 at p. 14) For the analysis of national 
impacts of standards, DOE considers the lifetime impacts of equipment 
shipped in a 30-year period, with energy and cost savings impacts 
aggregated until all of the equipment shipped in the 30-year period is 
retired. With respect to the valuation of CO2 emissions 
reductions, the SCC estimates developed by the IWG are meant to 
represent the full discounted value (using an appropriate range of 
discount rates) of emissions reductions occurring in a given year. 
Thus, DOE multiplies the SCC values for achieving the emissions 
reductions in each year of the analysis by the carbon reductions 
estimated for each of those same years. Neither the costs nor the 
benefits of emissions reductions outside the analytic time frame are 
included in the analysis.
2. Valuation of Other Emissions Reductions
    As noted in section IV.K, DOE has taken into account how new or 
amended energy conservation standards would reduce NOX 
emissions in those 22 States not affected by emissions caps. DOE 
estimated the monetized value of NOX emissions reductions 
resulting from each of the TSLs considered for this final rule based on 
estimates found in the relevant scientific literature. Estimates of 
monetary value for reducing NOX from stationary sources 
range from $476 to $4,893 per ton (2013$).\67\ DOE calculated monetary 
benefits using a medium value for NOX emissions of $2,684 
per short ton (in 2013$), and real discount rates of 3 percent and 7 
percent.
---------------------------------------------------------------------------

    \67\ U.S. Office of Management and Budget, Office of Information 
and Regulatory Affairs, 2006 Report to Congress on the Costs and 
Benefits of Federal Regulations and Unfunded Mandates on State, 
Local, and Tribal Entities, Washington, DC. Available at: 
www.whitehouse.gov/sites/default/files/omb/assets/omb/inforeg/2006_cb/2006_cb_final_report.pdf.
---------------------------------------------------------------------------

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

M. Utility Impact Analysis

    The utility impact analysis estimates several effects on the power 
generation industry that would result from the adoption of new or 
amended energy conservation standards. In the utility impact analysis, 
DOE analyzes the changes in electric installed capacity and generation 
that result for each TSL. The utility impact analysis uses a variant of 
NEMS,\68\ which is a public domain, multi-sectored, partial equilibrium 
model of the U.S. energy sector. DOE uses a variant of this model, 
referred to as NEMS-BT,\69\ to account for selected utility impacts of 
new or amended energy conservation standards. DOE's analysis consists 
of a comparison between model results for the most recent AEO Reference 
Case and for cases in which energy use is decremented to reflect the 
impact of potential standards. The energy savings inputs associated 
with each TSL come from the NIA. Chapter 15 of the final rule TSD 
describes the utility impact analysis.
---------------------------------------------------------------------------

    \68\ For more information on NEMS, refer to the U.S. Department 
of Energy, Energy Information Administration documentation. A useful 
summary is National Energy Modeling System: An Overview 2003, DOE/
EIA-0581(2003), March, 2003.
    \69\ DOE/EIA approves use of the name ``NEMS'' to describe only 
an official version of the model without any modification to code or 
data. Because this analysis entails some minor code modifications 
and the model is run under various policy scenarios that are 
variations on DOE/EIA assumptions, DOE refers to it by the name 
``NEMS-BT'' (``BT'' is DOE's Building Technologies Program, under 
whose aegis this work has been performed).
---------------------------------------------------------------------------

    DOE received one comment about the utility impact analysis. Policy 
Analyst commented that DOE should commit to measuring the effects of 
these energy savings on the security, reliability, and costs of 
maintaining the nation's energy system. (Policy Analyst, No. 75 at p. 
10) As discussed in Chapter 15 of the TSD, DOE does quantify the 
effects of the energy savings on the nation's energy system. Given the 
widely dispersed nature of automatic commercial ice makers on customer 
premises across the country, physically measuring the impacts would be 
time-consuming and costly and would likely not result in useful 
measurements of the effects. DOE has over the course of many energy 
conservation standards rulemakings developed the tools and processes 
used in this rulemaking to estimate the impacts on the electric utility 
system, and those impacts are discussed in Chapter 15 of the TSD.

N. Employment Impact Analysis

    Employment impacts from new or amended energy conservation 
standards include direct and indirect impacts. Direct employment 
impacts, which are addressed in the MIA, are any changes in the number 
of employees of manufacturers of the equipment subject to standards. 
Indirect employment impacts, which are assessed as part of the 
employment impact analysis, are changes in national employment that 
occur due to the shift in expenditures and capital investment caused by 
the purchase and operation of more-efficient equipment. Indirect 
employment impacts from standards consist of the jobs created or 
eliminated in the national economy due to (1) reduced spending by end 
users on energy; (2) reduced spending on new energy supply by the 
utility industry; (3) increased customer spending on the purchase of 
new equipment; and (4) the effects of those three factors throughout 
the economy.
    One method for assessing the possible effects on the demand for 
labor of such shifts in economic activity is to compare sector 
employment statistics developed by the Labor Department's Bureau of 
Labor Statistics (BLS). BLS regularly publishes its estimates of the 
number of jobs per million dollars of economic activity in different 
sectors of the economy, as well as the jobs created elsewhere in the 
economy by this same economic activity. Data from BLS indicate that 
expenditures in the utility sector generally create fewer jobs (both 
directly and indirectly) than expenditures in other sectors of the

[[Page 4717]]

economy.\70\ There are many reasons for these differences, including 
wage differences and the fact that the utility sector is more capital-
intensive and less labor-intensive than other sectors. Energy 
conservation standards have the effect of reducing customer utility 
bills. Because reduced customer expenditures for energy likely lead to 
increased expenditures in other sectors of the economy, the general 
effect of efficiency standards is to shift economic activity from a 
less labor-intensive sector (i.e., the utility sector) to more labor-
intensive sectors (e.g., the retail and service sectors). Thus, based 
on the BLS data alone, DOE believes net national employment may 
increase because of shifts in economic activity resulting from amended 
energy conservation standards for automatic commercial ice makers.
---------------------------------------------------------------------------

    \70\ See U.S. Department of Commerce--Bureau of Economic 
Analysis. Regional Multipliers: A User Handbook for the Regional 
Input-Output Modeling System (RIMS II). 1992.
---------------------------------------------------------------------------

    For the standard levels considered in this final rule, DOE 
estimated indirect national employment impacts using an input/output 
model of the U.S. economy called Impact of Sector Energy Technologies 
version 3.1.1 (ImSET).\71\ ImSET is a special-purpose version of the 
``U.S. Benchmark National Input-Output'' (I-O) model, which was 
designed to estimate the national employment and income effects of 
energy-saving technologies. The ImSET software includes a computer-
based I-O model having structural coefficients that characterize 
economic flows among the 187 sectors. ImSET's national economic I-O 
structure is based on a 2002 U.S. benchmark table, specially aggregated 
to the 187 sectors most relevant to industrial, commercial, and 
residential building energy use. DOE notes that ImSET is not a general 
equilibrium forecasting model and understands the uncertainties 
involved in projecting employment impacts, especially changes in the 
later years of the analysis. Because ImSET does not incorporate price 
changes, the employment effects predicted by ImSET may overestimate 
actual job impacts over the long run. For the final rule, DOE used 
ImSET only to estimate short-term (through 2022) employment impacts.
---------------------------------------------------------------------------

    \71\ Scott, M.J., O.V. Livingston, P.J. Balducci, J.M. Roop, and 
R.W. Schultz. ImSET 3.1: Impact of Sector Energy Technologies. 2009. 
Pacific Northwest National Laboratory, Richland, WA. Report No. 
PNNL-18412. www.pnl.gov/main/publications/external/technical_reports/PNNL-18412.pdf.
---------------------------------------------------------------------------

    DOE received no comments specifically on the indirect employment 
impacts. Comments received were related to manufacturing employment 
impacts, and DOE reiterates that the indirect employment impacts 
estimated with ImSET for the entire economy differ from the direct 
employment impacts in the ACIM manufacturing sector estimated using the 
GRIM in the MIA, as described at the beginning of this section. The 
methodologies used and the sectors analyzed in the ImSET and GRIM 
models are different.
    For more details on the employment impact analysis and its results, 
see chapter 16 of the TSD and section V.B.3.d of this preamble.

O. Regulatory Impact Analysis

    DOE prepared a regulatory impact analysis (RIA) for this 
rulemaking, which is described in chapter 17 of the final rule TSD. The 
RIA is subject to review by the Office of Information and Regulatory 
Affairs (OIRA) in the OMB. The RIA consists of (1) a statement of the 
problem addressed by this regulation and the mandate for government 
action; (2) a description and analysis of policy alternatives to this 
regulation; (3) a qualitative review of the potential impacts of the 
alternatives; and (4) the national economic impacts of the proposed 
standard.
    The RIA assesses the effects of feasible policy alternatives to 
amended automatic commercial ice makers standards and provides a 
comparison of the impacts of the alternatives. DOE evaluated the 
alternatives in terms of their ability to achieve significant energy 
savings at reasonable cost and compared them to the effectiveness of 
the proposed rule.
    DOE identified the following major policy alternatives for 
achieving increased automatic commercial ice makers efficiency:

     No new regulatory action
     Commercial customer tax credits
     Commercial customer rebates
     Voluntary energy efficiency targets
     Bulk government purchases
     Early replacement.

    DOE qualitatively evaluated each alternative's ability to achieve 
significant energy savings at reasonable cost and compared it to the 
effectiveness of the proposed rule. See chapter 17 of the final rule 
TSD for further details.
    In response to the NOPR, DOE received comments from NAFEM stating 
that NAFEM commented that DOE failed to consider the positive role of 
ENERGY STAR in the marketplace, that the Federal Energy Management 
Program (FEMP) already encourages manufacturers to innovate and create 
energy savings, the effects of local and state initiatives, and the 
effects of voluntary building standards that require high efficiency 
products in the marketplace. (NAFEM, No. 82 at pp. 8-9)
    In response to the NAFEM comment, DOE notes first that FEMP and 
other voluntary programs tend to use ENERGY STAR as the efficiency 
target levels for equipment classes covered by ENERGY STAR. DOE 
recognizes that the market has achieved a roughly 60-percent success 
rate in reaching the ENERGY STAR criteria for the time that ENERGY STAR 
has covered automatic commercial ice makers. The market-driven 
accomplishments are reflected in the distribution of shipments by 
efficiency level for the base conditions, and very much influence the 
results of the analysis. The selected TSL 3 yields a shipments-weighted 
average efficiency improvement of approximately 8 percent. If all 
customers purchased efficiency level 1 equipment (i.e., baseline 
equipment), the shipments-weighted average efficiency improvement would 
be over 18 percent. The difference is attributable to the combination 
of ENERGY STAR, FEMP, utility incentive programs, incentive programs 
operated by governmental entities and others, and customer economic 
decision making.
    In deciding what efficiency targets to model in the RIA, DOE noted 
that modeling the new ENERGY STAR criteria would show modest energy 
savings and NPV results because, as noted above, the baseline already 
reflects the market-driven accomplishments. Further, ENERGY STAR 
changes their criteria periodically. The first set of automatic 
commercial ice maker criteria was in effect for approximately 5 years, 
and the second set became effective February 1, 2013. If the ENERGY 
STAR criteria are updated again after a 5-year period, the criteria 
will be revised by the compliance date of this rule. Because future 
ENERGY STAR criteria are unknown, DOE performed the regulatory impact 
analysis using TSL 3 efficiency levels matched with the 60-percent 
ENERGY STAR success rate. DOE believes that in performing the analysis 
in this fashion, DOE was acknowledging the ability of the ENERGY STAR 
program to reach customers and impact their decision-making.

V. Analytical Results

A. Trial Standard Levels

1. Trial Standard Level Formulation Process and Criteria
    DOE selected between two and seven efficiency levels for all 
equipment

[[Page 4718]]

classes for analysis. For all equipment classes, the first efficiency 
level is the baseline efficiency level. Based on the results of the NIA 
and other analyses, DOE selected five TSLs above the baseline level for 
each equipment class for the NOPR stage of this rulemaking. Table V.1 
shows the mapping between TSLs and efficiency levels.
    TSL 5 was selected as the max-tech level for all equipment classes. 
At this level, DOE's analysis considered that equipment would require 
use of design options that generally are not used by ice makers, but 
that are currently commercially available; specifically drain water 
heat exchangers for batch ice makers and ECM motors for all ice maker 
classes. The range of energy use reduction at the max-tech level varies 
widely with the equipment class, from 7% for IMH-W-Large-B to 33% for 
SCU-A-Small-B.
    TSL 4 was chosen as an intermediate level between the max-tech 
level and the maximum customer NPV level, subject to the requirement 
that the TSL 4 NPV must be positive. ``Customer NPV'' is the NPV of 
future savings obtained from the NIA. It provides a measure of the 
benefits only to the customers of the automatic commercial ice makers 
and does not account for the net benefits to the nation. The net 
benefits to the nation also include monetized values of emissions 
reductions in addition to the customer NPV. Where a sufficient number 
of efficiency levels allow it, TSL 4 is set at least one level below 
max-tech and one level above the efficiency level with the highest NPV. 
In one case, the TSL 4 efficiency level is the maximum NPV level 
because the next higher level had a negative NPV. In cases where the 
maximum NPV efficiency level is the penultimate efficiency level and 
the max-tech level showed a positive NPV, the TSL 4 efficiency level is 
also the max-tech level.
    TSL 3 was chosen to represent the group of efficiency levels with 
the highest customer NPV at a 7-percent discount rate.
    TSL 2 was selected to provide intermediate efficiency levels 
between the TSLs 1 and 3. Note that with the number of efficiency 
levels available for each equipment class, there is often overlap 
between TSL levels. Thus, TSL 2 includes efficiency levels that overlap 
with both TSLs 1 and 3. The intent of TSL 2 is to provide an 
intermediate level that examines in efficiency options between TSLs 1 
and 3.
    TSL 1 was set equal to efficiency level 2. In the NOPR analysis, 
DOE set efficiency level 2 to be equivalent to ENERGY STAR in effect at 
the time DOE started the analysis for products rated by ENERGY STAR and 
to an equivalent efficiency improvement for other equipment classes. 
However, the ENERGY STAR level for automatic commercial ice makers has 
since been revised.\72\ Therefore, in the NODA and final rule analysis 
DOE has instead used a more consistent 10-percent level for efficiency 
level 2, representing energy use 10 percent lower than the baseline 
energy use. This level reflects but is not fully consistent with the 
former ENERGY STAR level for those classes covered by ENERGY STAR. The 
new ENERGY STAR level, defined for all air-cooled equipment classes 
(i.s. IMH-A, RCU, and SCU-A classes for both batch and continuous ice 
makers) does not consistently align with any of the TSLs selected by 
DOE. For example, for IMH-A batch classes, the current ENERGY STAR 
level corresponds roughly to TSL 1 at 300 lb ice/24 hours, TSL 3 at 800 
lb ice/24 hours, and is more stringent than TSL 5 at 1,500 lb ice/24 
hours. Graphical comparison of the TSLs, ENERGY STAR, and existing 
products is providing in Chapter 3 of the TSL.
---------------------------------------------------------------------------

    \72\ ENERGY STAR Version 2.0 for Automatic Commercial Ice Makers 
became effective on February 1, 2013.

                                                 Table V.1--Mapping Between TSLs and Efficiency Levels *
--------------------------------------------------------------------------------------------------------------------------------------------------------
          Equipment class                     TSL 1                   TSL 2                  TSL 3                  TSL 4                  TSL 5
--------------------------------------------------------------------------------------------------------------------------------------------------------
IMH-W-Small-B......................  Level 2...............  Level 2...............  Level 3..............  Level 3..............  Level 5.
IMH-W-Med-B........................  Level 2...............  Level 2...............  Level 2..............  Level 3..............  Level 4.
IMH-W-Large-B [dagger]
    IMH-W-Large-B-1................  Level 1...............  Level 1...............  Level 1..............  Level 1..............  Level 2.
    IMH-W-Large-B-2................  Level 1...............  Level 1...............  Level 1..............  Level 1..............  Level 2.
IMH-A-Small-B......................  Level 2...............  Level 3...............  Level 3A.............  Level 3A.............  Level 6.
IMH-A-Large-B [dagger]
    IMH-A-Large-B1.................  Level 2...............  Level 3...............  Level 3A.............  Level 4..............  Level 5.
    IMH-A-Large-B2.................  Level 2...............  Level 2...............  Level 3..............  Level 3..............  Level 3.
RCU-Large-B[dagger]
    RCU-Large-B1...................  Level 2...............  Level 2...............  Level 2..............  Level 3..............  Level 4.
    RCU-Large-B2...................  Level 2...............  Level 2...............  Level 2..............  Level 2..............  Level 3.
SCU-W-Large-B......................  Level 2...............  Level 4...............  Level 5..............  Level 6..............  Level 6.
SCU-A-Small-B......................  Level 2...............  Level 4...............  Level 5..............  Level 6..............  Level 7.
SCU-A-Large-B......................  Level 2...............  Level 4...............  Level 5..............  Level 6..............  Level 6.
IMH-A-Small-C......................  Level 2...............  Level 3...............  Level 4..............  Level 4..............  Level 6.
IMH-A-Large-C......................  Level 2...............  Level 2...............  Level 3..............  Level 3..............  Level 5.
RCU-Small-C........................  Level 2...............  Level 3...............  Level 4..............  Level 4..............  Level 6.
SCU-A-Small-C......................  Level 2...............  Level 3...............  Level 4..............  Level 4..............  Level 6.
--------------------------------------------------------------------------------------------------------------------------------------------------------
* For three large equipment classes--IMH-W-Large-B, IMH-A-Large-B, and RCU-Large-B--because the harvest capacity range is so wide, DOE analyzed two
  typical models to model the low and the high portions of the applicable range with greater accuracy. The smaller of the two is noted as B1 and the
  larger as B2.
[dagger] DOE analyzed impacts for the B1 and B2 typical units and aggregated impacts to the equipment class level.

[[Page 4719]]

    Table V.2 illustrates the efficiency improvements incorporated in 
all TSLs.

                       Table V.2--Percentage Efficiency Improvement From Baseline by TSL *
----------------------------------------------------------------------------------------------------------------
         Equipment class               TSL 1           TSL 2           TSL 3           TSL 4           TSL 5
----------------------------------------------------------------------------------------------------------------
IMH-W-Small-B...................           10.0%           10.0%           15.0%           15.0%           23.9%
IMH-W-Med-B.....................            10.0            10.0            10.0            15.0            18.1
IMH-W-Large-B...................             0.0             0.0             0.0             0.0             8.1
    IMH-W-Large-B1..............             0.0             0.0             0.0             0.0             8.3
    IMH-W-Large-B2..............             0.0             0.0             0.0             0.0             7.4
IMH-A-Small-B...................            10.0            15.0            18.1            18.1            25.5
IMH-A-Large-B...................            10.0            14.2            15.2            18.7            21.6
    IMH-A-Large-B1..............            10.0            15.0            15.8            20.0            23.4
    IMH-A-Large-B2..............            10.0            10.0            11.8            11.8            11.8
RCU-Large-B.....................            10.0            10.0            10.0            14.7            17.1
    RCU-Large-B1................            10.0            10.0            10.0            15.0            17.3
    RCU-Large-B2................            10.0            10.0            10.0            10.0            13.9
SCU-W-Large-B...................            10.0            20.0            25.0            29.8            29.8
SCU-A-Small-B...................            10.0            20.0            25.0            30.0            32.7
SCU-A-Large-B...................            10.0            20.0            25.0            29.1            29.1
IMH-A-Small-C...................            10.0            15.0            20.0            20.0            25.7
IMH-A-Large-C...................            10.0            10.0            15.0            15.0            23.3
RCU-Small-C.....................            10.0            15.0            20.0            20.0            26.6
SCU-A-Small-C...................            10.0            15.0            20.0            20.0            26.6
----------------------------------------------------------------------------------------------------------------
* Percentage improvements for IMH-W-Large-B, IMH-A-Large-B, and RCU-Large-B are a weighted average of the B1 and
  B2 units, using weights provided in TSD chapter 7.

    Table V.3 illustrates the design options associated with each TSL 
level, for each analyzed product class. The design options are 
discussed in section IV.D.3 of this final rule and in chapter 5 of the 
TSD.

                                           Table V.3--Design Options for Analyzed Products Classes at Each TSL
--------------------------------------------------------------------------------------------------------------------------------------------------------
         Equipment class               Baseline              TSL 1               TSL 2               TSL 3               TSL 4               TSL 5
--------------------------------------------------------------------------------------------------------------------------------------------------------
                               Design Options for Each TSL (options are cumulative--TSL 5 includes all preceding options)
--------------------------------------------------------------------------------------------------------------------------------------------------------
IMH-W-Small-B...................  No BW Fill........  + Comp EER........  Same EL as TSL 1..  + Cond............  Same EL as TSL 3..  BW Fill
                                  SPM PM............  + Cond............                                                              + Evap
                                                                                                                                      ECM PM
                                                                                                                                      DWHX.
IMH-W-Small-B (22 inch wide)....  No BW Fill........  + Comp EER........  Same EL as TSL 1..  + Cond............  Same EL as TSL 3..  N/A for 22-inch.
                                  SPM PM............  + Cond............                      BW Fill...........
IMH-W-Med-B.....................  BW Fill...........  + Comp EER........  Same EL as TSL 1..  Same EL as TSL 1..  + Cond............  DWHX.
                                  SPM PM............  ECM PM............
IMH-W-Large-B1..................  BW Fill...........  Same EL as          Same EL as          Same EL as          Same EL as          + Comp EER
                                  SPM PM............   Baseline.           Baseline.           Baseline.           Baseline.          + Cond
                                                                                                                                      ECM PM
                                                                                                                                      DWHX.
IMH-W-Large-B2..................  BW Fill...........  Same EL as          Same EL as          Same EL as          Same EL as          + Comp EER
                                  SPM PM............   Baseline.           Baseline.           Baseline.           Baseline.          + Cond
                                                                                                                                      ECM PM
                                                                                                                                      DWHX.
IMH-A-Small-B...................  BW Fill...........  + Comp EER........  + Evap............  + Evap............  Same EL as TSL 3..  + Evap
                                  SPM PM............  + Cond............                                                              ECM PM
                                  SPM FM............  + Evap............                                                              DWHX.
                                                      ECM FM............
IMH-A-Small-B (22 inch wide)....  BW Fill...........  + Comp EER........  + Evap............  ECM PM............  Same EL as TSL 3..  N/A for 22-inch.
                                  SPM PM............  + Cond............                      DWHX..............
                                  SPM FM............  + Evap............
                                                      ECM FM............
IMH-A-Large-B1..................  No BW Fill........  + Comp EER........  ECM FM............  BW Fill...........  BW Fill...........  DWHX.
                                  SPM PM............  PSC FM............  BW Fill...........                      ECM PM............
                                  SPM FM............                                                              + Cond............
IMH-A-Large-B1 (22 inch wide)...  No BW Fill........  + Comp EER........  BW Fill...........  DWHX..............  N/A for 22-inch...  N/A for 22-inch.
                                  SPM PM............  ECM FM............  ECM PM............
                                  SPM FM............  BW Fill...........  DWHX..............
IMH-A-Large-B2..................  BW Fill...........  + Comp EER........  Same EL as TSL 1..  DWHX..............  Same EL as TSL 3..  Same EL as TSL 3.
                                  SPM PM............  ECM FM............
                                  SPM FM............  ECM PM............
                                                      + Cond............
                                                      DWHX..............

[[Page 4720]]

 
RCU-Large-B1....................  BW Fill...........  + Cond............  Same EL as TSL 1..  Same EL as TSL 1..  ECM FM............  DWHX.
                                  SPM PM............  + Comp EER........                                          ECM PM............
                                  PSC FM............                                                              + Cond............
                                                                                                                  DWHX..............
RCU-Large-B2....................  BW Fill...........  + Comp EER........  Same EL as TSL 1..  Same EL as TSL 1..  Same EL as TSL 1..  DWHX.
                                  SPM PM............  ECM FM............
                                  PSC FM............  + Cond............
                                                      ECM PM............
SCU-W-Large-B...................  No BW Fill........  BW Fill...........  +Evap.............  + Cond............  + Cond............  DWHX.
                                  SPM PM............  + Evap............  + Cond............
SCU-A-Small-B...................  No BW Fill........  + Cond............  + Comp EER........  PSC FM............  BW Fill...........  ECM FM
                                  SPM PM............  + Comp............                      BW Fill...........  ECM PM............  DWHX.
                                  SPM FM............  EER...............                                          ECM FM............
SCU-A-Large-B...................  No BW Fill........  +Cond.............  + Comp EER........  BW Fill...........  ECM PM............  Same EL as TSL 4.
                                  SPM PM............  + Comp EER........  BW Fill...........  ECM FM............  DWHX..............
                                  SPM FM............
RCU-Small-C.....................  PSC AM............  + Comp EER........  ECM FM............  ECM FM............  Same EL as TSL3...  + Cond
                                  SPM FM............  PSC FM............                      + Cond............                      ECM AM.
IMH-A-Small-C...................  PSC AM............  + Comp EER........  + Cond............  ECM FM............  Same EL as TSL 3..  ECM AM.
                                  SPM FM............  + Cond............  ECM FM............  + Cond............
IMH-A-Large-C...................  PSC AM............  + Comp EER........  Same EL as TSL 1..  + Comp EER........  Same EL as TSL 3..  + Cond
                                  SPM FM............                                          + Cond............                      ECM FM
                                                                                                                                      ECM AM.
SCU-A-Small-C...................  PSC AM............  + Cond............  + Comp EER........  + Comp EER........  Same EL as TSL 3..  ECM FM
                                  SPM FM............  + Comp EER........                      ECM FM............                      ECM AM.
--------------------------------------------------------------------------------------------------------------------------------------------------------
EL = Efficiency Level
SPM = Shaded Pole Motor
PSC = Permanent Split Capacitor Motor
ECM = Electronically Commutated Motor
FM = Fan Motor (Air-Cooled Units)
AM = Auger Motor (Continuous Units)
BW Fill = Batch Water Fill Option Included
+ Cond = Increase in Condenser Size
+ Evap = Increase in Evaporator Size
+ Comp EER = Increase in Compressor EER
DWHX = Addition of Drain Water Heat Exchanger

    Chapter 5 of the TSD contains full descriptions of the design 
options, DOE's analyses for the equipment size increase associated with 
the design options selected, and DOE's analyses of the efficiency gains 
for each design option considered.
2. Trial Standard Level Equations
    Table V.4 and Table V.5 translate the TSLs into potential 
standards. In Table V.4, the TSLs are translated into energy 
consumption standards for the batch classes, while Table V.5 provides 
the potential energy consumption standards for the continuous classes. 
Note that the size nomenclature for the classes (Small, Medium, Large, 
and Extended) in many cases designate different capacity ranges than 
the current class sizes. However, the discussion throughout this 
preamble is based primarily on the current class capacity ranges--the 
alternative designation is made in Table V.4 and Table V.5 for future 
use when the new energy conservation standards take effect.

                                         Table V.4--Equations Representing the TSLs for Batch Equipment Classes
                                                         [Maximum energy use in kWh/100 lb ice]
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                          Capacity range
                  Batch equipment class                      lb ice/24         TSL 1           TSL 2           TSL 3           TSL 4           TSL 5
                                                               hours
--------------------------------------------------------------------------------------------------------------------------------------------------------
IMH-W-Small-B...........................................            =300 and =850 and   4.42-0.00028H   4.42-0.00028H             4.0             4.0   3.86-0.00012H
                                                                   =1,500 and             4.0             4.0             4.0             4.0          3.62 +
                                                                  =2,600             4.0             4.0             4.0             4.0            3.72
IMH-A-Small-B...........................................            =300 and =800 and   6.21-0.00099H   5.56-0.00056H   5.55-0.00063H   5.04-0.00029H   4.65-0.00003H
                                                                  1,500            4.73            4.72            4.61            4.61            4.61
RCU-NRC-Small-B.........................................          =988 * and            4.59            4.59            4.59            4.34            4.23
                                                                  =1,500 and            4.59            4.59            4.59          3.92 +          3.96 +
                                                                  =2,400            4.59            4.59            4.59            4.59            4.39
RCU-RC-Small-B..........................................         =930 ** and            4.79            4.79            4.79            4.54            4.43
                                                                  =1,500 and =2,400            4.79            4.79            4.79            4.79            4.59
SCU-W-Small-B...........................................            =200            6.84            6.08             5.7            5.34            5.34
SCU-A-Small-B...........................................            =110 and =200            8.82            7.84            7.35            6.96            6.96
--------------------------------------------------------------------------------------------------------------------------------------------------------
* 985 for TSL4, 1,000 for TSL5
** 923 for TSL4, 936 for TSL5

                                       Table V.5--Equations Representing the TSLs for Continuous Equipment Classes
                                                         [Maximum energy use in kWh/100 lb ice]
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                          Capacity range
               Continuous equipment class                    lb ice/24         TSL 1           TSL 2           TSL 3           TSL 4           TSL 5
                                                               hours
--------------------------------------------------------------------------------------------------------------------------------------------------------
IMH-W-Small-C...........................................            =801            4.59            4.59            4.34            4.34            3.93
IMH-A-Small-C...........................................            =310 and =820            5.94            5.94            5.61            5.61            5.08
RCU-NRC-Small-C.........................................            =800             5.7            5.38            5.06            5.06            4.62
RCU-RC-Small-C..........................................            =800             5.9            5.58            5.26            5.26            4.82
SCU-W-Small-C...........................................            =900            5.49            5.19            4.88            4.88            4.39
SCU-A-Small-C...........................................            =200 and 700  10.66-0.00702H  10.06-0.00663H   9.47-0.00624H   9.47-0.00624H   8.52-0.00562H
SCU-A-Extended-C........................................           >=700            5.75            5.42             5.1             5.1            4.59
--------------------------------------------------------------------------------------------------------------------------------------------------------

    In developing TSLs, DOE analyzed representative units for each 
equipment class group, defined for the purposes of this discussion by 
the ``Type of Ice Maker,'' ``Equipment Type,'' and ``Type of Condenser 
Cooling'' (see Table IV.2--within each class group, further segregation 
into equipment classes involves only specification of harvest capacity 
rate). DOE first established a percentage reduction in energy use 
associated with each TSL for the representative units. DOE calculated 
the energy use (in kWh/100 lb ice) associated with this reduction for 
the harvest capacity rates associated with the representative units 
(called representative capacities). This provided one or more points 
with which to define a TSL curve for the entire equipment class group 
as a function of harvest capacity rate. DOE selected the TSL curve to 
(a) pass through the points defining energy use for the TSL at the 
representative capacities; (b) be continuous, with no gaps at the 
representative capacities or at any other capacities; and (c) be 
consistent with the energy and capacity trends for

[[Page 4722]]

commercialized products of the equipment class group.
    For the IMH-A-B equipment classes, DOE sought to set efficiency 
levels that do not vary with harvest capacity for the largest-capacity 
equipment, but doing so would have violated EPCA's anti-backsliding 
provisions. As a result, the efficiency levels for large-capacity 
equipment for this class in the range up to 2,500 lb ice/24 hours were 
set using multiple segments. This is discussed in section IV.D.2.c.
    For the RCU-RC-Large-B, RCU-RC-Small-C, and RCU-RC-Large-C 
equipment classes, the efficiency levels are 0.2 kWh/100 lb of ice 
higher than those of the RCU-NRC-Large-B, RCU-NRC-Small-C, and RCU-NRC-
Large-C equipment classes, respectively, as discussed in section 
IV.D.2.a. The RCU-RC-Small-B and RCU-NRC-Small-B efficiency levels are 
equal, and the harvest capacity break points for the RCU-NRC classes 
have been set to avoid gaps in allowable energy usage at the 
breakpoints.
    The TSL energy use levels calculated for the representative 
capacities of the directly-analyzed equipment classes are presented 
Table V.6.

        Table V.6--Energy Consumption by TSL for the Representative Automatic Commercial Ice Maker Units
----------------------------------------------------------------------------------------------------------------
                                Representative    Representative automatic commercial ice maker unit  kWh/100 lb
       Equipment class         harvest rate lb  ----------------------------------------------------------------
                                 ice/24 hours       TSL 1        TSL 2        TSL 3        TSL 4        TSL 5
----------------------------------------------------------------------------------------------------------------
IMH-W-Small-B...............                300         5.54         5.54         5.23         5.23         4.67
IMH-W-Med-B.................                850         4.18         4.18         4.18         4.00         3.76
IMH-W-Large-B-1.............              1,500         4.00         4.00         4.00         4.00         3.68
IMH-W-Large-B-2.............              2,600         4.00         4.00         4.00         4.00         3.72
IMH-A-Small-B...............                300         6.91         6.53         6.30         6.30         5.68
IMH-A-Large-B-1.............                800         5.41         5.11         5.05         4.81         4.63
IMH-A-Large-B-2.............              1,500         4.72         4.72         4.61         4.61         4.61
RCU-NRC-Large-B-1...........              1,500         4.59         4.59         4.59         4.34         4.23
RCU-NRC-Large-B-2...........              2,400         4.59         4.59         4.59         4.59         4.39
SCU-W-Large-B...............                300         6.84         6.08         5.70         5.34         5.34
SCU-A-Small-B...............                110        11.56        10.27         9.63         8.99         8.60
SCU-A-Large-B...............                200         8.82         7.84         7.35         6.96         6.96
IMH-A-Small-C...............                310         8.15         7.69         7.24         7.24         6.43
IMH-A-Large-C...............                820         5.94         5.94         5.61         5.61         5.08
RCU-Small-C.................                800         5.70         5.38         5.06         5.06         4.62
SCU-A-Small-C...............                220         9.11         8.61         8.10         8.10         7.29
----------------------------------------------------------------------------------------------------------------

B. Economic Justification and Energy Savings

1. Economic Impacts on Commercial Customers
a. Life-Cycle Cost and Payback Period
    Customers affected by new or amended standards usually incur higher 
purchase prices and lower operating costs. DOE evaluates these impacts 
on individual customers by calculating changes in LCC and the PBP 
associated with the TSLs. The results of the LCC analysis for each TSL 
were obtained by comparing the installed and operating costs of the 
equipment in the base-case scenario (scenario with no amended energy 
conservation standards) against the standards-case scenarios at each 
TSL. The energy consumption values for both the base-case and 
standards-case scenarios were calculated based on the DOE test 
procedure conditions specified in the 2012 test procedure final rule, 
which adopts an industry-accepted test method. Using the approach 
described in section IV.F, DOE calculated the LCC savings and PBPs for 
the TSLs considered in this final rule. The LCC analysis is carried out 
in the form of Monte Carlo simulations, and the results of LCC analysis 
are distributed over a range of values. DOE presents the mean or median 
values, as appropriate, calculated from the distributions of results.
    Table V.7 through Table V.25 show the results of the LCC analysis 
for each equipment class. Each table presents the results of the LCC 
analysis, including mean LCC, mean LCC savings, median PBP, and 
distribution of customer impacts in the form of percentages of 
customers who experience net cost, no impact, or net benefit.
    Only five equipment classes have positive LCC savings values at TSL 
5, while the remaining classes have negative LCC savings. Negative 
average LCC savings imply that, on average, customers experience an 
increase in LCC of the equipment as a consequence of buying equipment 
associated with that particular TSL. In four of the five classes, the 
TSL 5 level is not negative, but the LCC savings are less than one-
third the TSL 3 savings. All of these results indicate that the cost 
increments associated with the max-tech design option are high, and the 
increase in LCC (and corresponding decrease in LCC savings) indicates 
that the design options embodied in TSL 5 result in negative customer 
impacts. TSL 5 is associated with the max-tech level for all the 
equipment classes. Drain water heat exchanger technology is the design 
option associated with the max-tech efficiency levels for batch 
equipment classes. For continuous equipment classes, the max-tech 
design options are auger motors using permanent magnets.
    The mean LCC savings associated with TSL 4 are all positive values 
for all equipment classes. The mean LCC savings at all lower TSL levels 
are also positive. The trend is generally an increase in LCC savings 
for TSL 1 through 3, with LCC savings either remaining constant or 
declining at TSL 4. In two cases, the highest LCC savings are at TSL 2: 
IMH-A-Large-B1 and SCU-W-Large-B. In one case, IMH-A-Small-B, the 
highest LCC savings occur at TSL1. Two of the three classes with LCC 
savings maximums below TSL 3 have high one-time installation cost 
adders for building renovations expected to take place when existing 
units are replaced, causing the TSL3 LCC savings to be depressed 
relative to the lower levels. The drop-off in LCC savings at TSL 4 is 
generally associated with the relatively large cost for the max-tech 
design options, the savings for which frequently span the last two 
efficiency levels.
    As described in section IV.H.2, DOE used a ``roll-up'' scenario in 
this rulemaking. Under the roll-up scenario, DOE assumes that the 
market shares of

[[Page 4723]]

the efficiency levels (in the base case) that do not meet the standard 
level under consideration would be ``rolled up'' into (meaning ``added 
to'') the market share of the efficiency level at the standard level 
under consideration, and the market shares of efficiency levels that 
are above the standard level under consideration would remain 
unaffected. Customers, in the base-case scenario, who buy the equipment 
at or above the TSL under consideration, would be unaffected if the 
amended standard were to be set at that TSL. Customers, in the base-
case scenario, who buy equipment below the considered TSL, would be 
affected if the amended standard were to be set at that TSL. Among 
these affected customers, some may benefit from lower LCC of the 
equipment and some may incur a net cost due to higher LCC, depending on 
the inputs to LCC analysis, such as electricity prices, discount rates, 
installation costs, and markups. DOE's results indicate that, with two 
exceptions, nearly all customers either benefit or are unaffected by 
setting standards at TSLs 1, 2, or 3, with 0 to 2 percent of customers 
experiencing a net cost in all but two classes. Some customers 
purchasing IMH-A-Small-B (21 percent) and IMH-A-Large-B2 (10 percent) 
equipment will experience net costs at TSL3. In almost all cases, a 
portion of the market would experience net costs starting with TSL 4, 
although in several equipment classes the percentage is below 10 
percent. At TSL 5, only in IMH-A-Large-B2 (10 percent) and SCU-W-Large-
B (44 percent) do less than 50 percent of customers show a net cost, 
while in the other classes the percentage of customers with a net cost 
ranges as high as 96 percent.
    The median PBP values for TSLs 1 through 3 are generally less than 
3 years, except for IMH-A-Small-B where the TSL 3 PBP is 4.7 years and 
IMH-A-Large-B2 with a PBP of 6.9 years. The median PBP values for TSL 4 
range from 0.7 years to 6.9 years.
    PBP values for TSL 5 range from 4.9 years to nearly 12 years. In 
eight cases, the the PBP exceeds the expected 8.5-year equipment life.

                                                            Table V.7--Summary LCC and PBP Results for IMH-W-Small-B Equipment Class
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                  Life-cycle cost, all customers 2013$                     Life-cycle cost savings
                                                                               ----------------------------------------------------------------------------------------------------
                                                                  Energy usage                                               Affected          % of customers that experience          Payback
                               TSL                                   kWh/yr       Installed    Discounted                   customers'   ------------------------------------------    period,
                                                                                    cost        operating        LCC          average                                  Net benefit  median years
                                                                                                  cost                     savings 2013$   Net cost %   No  impact %        %
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
1...............................................................         2,551         2,476         9,533        12,009            175              0            63            37           2.5
2...............................................................         2,551         2,476         9,533        12,009            175              0            63            37           2.5
3...............................................................         2,411         2,537         9,381        11,918            214              1            47            52           2.7
4...............................................................         2,411         2,537         9,381        11,918            214              1            47            52           2.7
5...............................................................         2,162         3,371         9,200        12,571           (534)            96             0             4          13.4
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

                                                             Table V.8--Summary LCC and PBP Results for IMH-W-Med-B Equipment Class
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                  Life-cycle cost, all customers 2013$                     Life-cycle cost savings
                                                                               ----------------------------------------------------------------------------------------------------
                                                                  Energy usage                                               Affected          % of customers that experience          Payback
                               TSL                                   kWh/yr       Installed    Discounted                   customers'   ------------------------------------------    period,
                                                                                    cost        operating        LCC          average                                  Net benefit  median years
                                                                                                  cost                     savings 2013$   Net cost %   No  impact %        %
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
1...............................................................         5,439         4,325        21,470        25,795            308              0            44            56           2.1
2...............................................................         5,439         4,325        21,470        25,795            308              0            44            56           2.1
3...............................................................         5,439         4,325        21,470        25,795            308              0            44            56           2.1
4...............................................................         5,138         4,607        21,251        25,857            165             28            24            47           5.0
5...............................................................         4,951         4,943        21,115        26,058            (63)            65             9            26           7.6
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

                                                            Table V.9--Summary LCC and PBP Results for IMH-W-Large-B Equipment Class
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                  Life-cycle cost, all customers 2013$                     Life-cycle cost savings
                                                                               ----------------------------------------------------------------------------------------------------
                                                                  Energy usage                                               Affected          % of customers that experience          Payback
                               TSL                                   kWh/yr       Installed    Discounted                   customers'   ------------------------------------------    period,
                                                                                    cost        operating        LCC          average                                  Net benefit  median years
                                                                                                  cost                     savings 2013$   Net cost %   No  impact %        %
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
1...............................................................        10,750         6,129        42,992        49,121              0             NA            NA            NA            NA
2...............................................................        10,750         6,129        42,992        49,121              0             NA            NA            NA            NA
3...............................................................        10,750         6,129        42,992        49,121              0             NA            NA            NA            NA
4...............................................................        10,750         6,129        42,992        49,121              0             NA            NA            NA            NA
5...............................................................         9,891         6,913        42,381        49,294           (172)            67            13            20          10.6
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

                                                           Table V.10--Summary LCC and PBP Results for IMH-W-Large-B1 Equipment Class
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                  Life-cycle cost, all customers 2013$                     Life-cycle cost savings
                                                                               ----------------------------------------------------------------------------------------------------
                                                                  Energy usage                                               Affected          % of customers that experience          Payback
                               TSL                                   kWh/yr       Installed    Discounted                   customers'   ------------------------------------------    period,
                                                                                    cost        operating        LCC          average                                  Net benefit  median years
                                                                                                  cost                     savings 2013$   Net cost %   No  impact %        %
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
1...............................................................         9,166         5,004        37,051        42,055              0             NA            NA            NA            NA
2...............................................................         9,166         5,004        37,051        42,055              0             NA            NA            NA            NA

[[Page 4724]]

 
3...............................................................         9,166         5,004        37,051        42,055              0             NA            NA            NA            NA
4...............................................................         9,166         5,004        37,051        42,055              0             NA            NA            NA            NA
5...............................................................         8,405         5,747        36,509        42,256           (200)            70            13            17          11.1
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

                                                           Table V.11--Summary LCC and PBP Results for IMH-W-Large-B2 Equipment Class
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                  Life-cycle cost, all customers 2013$                     Life-cycle cost savings
                                                                               ----------------------------------------------------------------------------------------------------
                                                                  Energy usage                                               Affected          % of customers that experience          Payback
                               TSL                                   kWh/yr       Installed    Discounted                   customers'   ------------------------------------------    period,
                                                                                    cost        operating        LCC          average                                  Net benefit  median years
                                                                                                  cost                     savings 2013$   Net cost %   No  impact %        %
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
1...............................................................        15,868         9,763        62,182        71,945              0             NA            NA            NA            NA
2...............................................................        15,868         9,763        62,182        71,945              0             NA            NA            NA            NA
3...............................................................        15,868         9,763        62,182        71,945              0             NA            NA            NA            NA
4...............................................................        15,868         9,763        62,182        71,945              0             NA            NA            NA            NA
5...............................................................        14,693        10,681        61,346        72,027            (80)            59            13            29           8.9
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

                                                            Table V.12--Summary LCC and PBP Results for IMH-A-Small-B Equipment Class
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                  Life-cycle cost, all customers 2013$                     Life-cycle cost savings
                                                                               ----------------------------------------------------------------------------------------------------
                                                                  Energy usage                                               Affected          % of customers that experience          Payback
                               TSL                                   kWh/yr       Installed    Discounted                   customers'   ------------------------------------------    period,
                                                                                    cost        operating        LCC          average                                  Net benefit  median years
                                                                                                  cost                     savings 2013$   Net cost %   No  impact %        %
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
1...............................................................         3,184         2,539         8,420        10,959            136              1            76            22           3.4
2...............................................................         3,009         2,655         8,293        10,948             72             21            47            32           4.8
3...............................................................         2,901         2,695         8,214        10,909             77             21             0            79           4.7
4...............................................................         2,901         2,695         8,214        10,909             77             21             0            79           4.7
5...............................................................         2,640         3,331         8,048        11,379           (393)            95             0             5          11.9
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

                                                            Table V.13--Summary LCC and PBP Results for IMH-A-Large-B Equipment Class
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                    Life-cycle cost, all customers 2013$                    Life-cycle cost savings
                                                                                 --------------------------------------------------------------------------------------------------
                                                                                                                              Affected         % of customers that experience          Payback
                                TSL                                 Energy usage                 Discounted                  customers'  ------------------------------------------    period,
                                                                       kWh/yr       Installed     operating        LCC         average                                              median years
                                                                                      cost          cost                       savings     Net cost %   No  impact %   Net benefit
                                                                                                                                2013$                                       %
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
1.................................................................         7,272         4,337        14,598        18,935           382             1            69            30           2.2
2.................................................................         6,964         4,418        14,230        18,648           501             1            45            53           2.4
3.................................................................         6,881         4,435        14,170        18,605           361             2            12            86           2.3
4.................................................................         6,622         4,711        13,988        18,699           265            31            12            57           3.9
5.................................................................         6,411         5,068        13,834        18,902            55            53            10            37           5.6
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

                                                           Table V.14--Summary LCC and PBP Results for IMH-A-Large-B1 Equipment Class
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                    Life-cycle cost, all customers 2013$                    Life-cycle cost savings
                                                                                 --------------------------------------------------------------------------------------------------
                                                                                                                              Affected         % of customers that experience          Payback
                                TSL                                 Energy usage                 Discounted                  customers'  ------------------------------------------    period,
                                                                       kWh/yr       Installed     operating        LCC         average                                              median years
                                                                                      cost          cost                       savings     Net cost %   No  impact %   Net benefit
                                                                                                                                2013$                                       %
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
1.................................................................         6,617         4,172        13,943        18,115           439             0            66            34           1.2
2.................................................................         6,251         4,269        13,506        17,775           580             0            38            62           1.5
3.................................................................         6,192         4,275        13,464        17,738           407             0             3            97           1.5
4.................................................................         5,885         4,602        13,247        17,850           294            35             3            63           3.4
5.................................................................         5,636         5,025        13,066        18,091            45            61             0            39           5.4
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

[[Page 4725]]

                                                           Table V.15--Summary LCC and PBP Results for IMH-A-Large-B2 Equipment Class
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                    Life-cycle cost, all customers 2013$                    Life-cycle cost savings
                                                                                 --------------------------------------------------------------------------------------------------
                                                                                                                              Affected         % of customers that experience          Payback
                                TSL                                 Energy usage                 Discounted                  customers'  ------------------------------------------    period,
                                                                       kWh/yr       Installed     operating        LCC         average                                              median years
                                                                                      cost          cost                       savings     Net cost %   No  impact %   Net benefit
                                                                                                                                2013$                                       %
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
1.................................................................        10,802         5,222        18,129        23,350            76             9            83             8           7.4
2.................................................................        10,802         5,222        18,129        23,350            76             9            83             8           7.4
3.................................................................        10,591         5,298        17,975        23,273           110            10            61            29           6.9
4.................................................................        10,591         5,298        17,975        23,273           110            10            61            29           6.9
5.................................................................        10,591         5,298        17,975        23,273           110            10            61            29           6.9
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

                                                             Table V.16--Summary LCC and PBP Results for RCU-Large-B Equipment Class
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                    Life-cycle cost, all customers 2013$                    Life-cycle cost savings
                                                                                 --------------------------------------------------------------------------------------------------
                                                                                                                              Affected         % of customers that experience          Payback
                                TSL                                 Energy usage                 Discounted                  customers'  ------------------------------------------    period,
                                                                       kWh/yr       Installed     operating        LCC         average                                              median years
                                                                                      cost          cost                       savings     Net cost %   No  impact %   Net benefit
                                                                                                                                2013$                                       %
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
1.................................................................        10,908         6,423        14,588        21,012           748             0            56            44           1.1
2.................................................................        10,908         6,423        14,588        21,012           748             0            56            44           1.1
3.................................................................        10,908         6,423        14,588        21,012           748             0            56            44           1.1
4.................................................................        10,362         6,813        14,213        21,026           418            23            22            55           3.3
5.................................................................        10,066         7,207        14,000        21,206           144            55             2            42           5.0
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

                                                            Table V.17--Summary LCC and PBP Results for RCU-Large-B1 Equipment Class
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                    Life-cycle cost, all customers 2013$                    Life-cycle cost savings
                                                                                 --------------------------------------------------------------------------------------------------
                                                                                                                              Affected         % of customers that experience          Payback
                                TSL                                 Energy usage                 Discounted                  customers'  ------------------------------------------    period,
                                                                       kWh/yr       Installed     operating        LCC         average                                              median years
                                                                                      cost          cost                       savings     Net cost %   No  impact %   Net benefit
                                                                                                                                2013$                                       %
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
1.................................................................        10,514         6,220        14,190        20,410           743             0            56            44           0.9
2.................................................................        10,514         6,220        14,190        20,410           743             0            56            44           0.9
3.................................................................        10,514         6,220        14,190        20,410           743             0            56            44           0.9
4.................................................................         9,931         6,635        13,790        20,425           391            25            20            55           3.4
5.................................................................         9,664         6,985        13,595        20,580           161            55             1            44           4.9
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

                                                            Table V.18--Summary LCC and PBP Results for RCU-Large-B2 Equipment Class
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                  Life-cycle cost, all customers 2013$                     Life-cycle cost savings
                                                                               ----------------------------------------------------------------------------------------------------
                                                                  Energy usage                                               Affected          % of customers that experience          Payback
                               TSL                                   kWh/yr       Installed    Discounted                   customers'   ------------------------------------------    period,
                                                                                    cost        operating        LCC          average                                  Net benefit  median years
                                                                                                  cost                     savings 2013$   Net cost %   No  impact %        %
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
1...............................................................        16,807         9,465        20,540        30,005            820              1            56            43           3.0
2...............................................................        16,807         9,465        20,540        30,005            820              1            56            43           3.0
3...............................................................        16,807         9,465        20,540        30,005            820              1            56            43           3.0
4...............................................................        16,807         9,465        20,540        30,005            820              1            56            43           3.0
5...............................................................        16,077        10,516        20,046        30,562           (109)            57            20            23           7.0
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

                                                            Table V.19--Summary LCC and PBP Results for SCU-W-Large-B Equipment Class
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                    Life-cycle cost, all customers 2013$                    Life-cycle cost savings
                                                                                 --------------------------------------------------------------------------------------------------
                                                                                                                              Affected         % of customers that experience          Payback
                                TSL                                 Energy usage                 Discounted                  customers'  ------------------------------------------    period,
                                                                       kWh/yr       Installed     operating        LCC         average                                              median years
                                                                                      cost          cost                       savings     Net cost %   No  impact %   Net benefit
                                                                                                                                2013$                                       %
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
1.................................................................         3,151         3,540        10,617        14,158           444             0            28            72           1.1
2.................................................................         2,804         3,620        10,364        13,984           613             0            28            72           1.6
3.................................................................         2,630         3,664        10,238        13,902           550             0             5            94           1.8
4.................................................................         2,464         4,114        10,117        14,231           192            44             0            56           5.1
5.................................................................         2,464         4,114        10,117        14,231           192            44             0            56           5.1
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

[[Page 4726]]

                                                            Table V.20--Summary LCC and PBP Results for SCU-A-Small-B Equipment Class
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                  Life-cycle cost, all customers 2013$                     Life-cycle cost savings
                                                                               ----------------------------------------------------------------------------------------------------
                                                                  Energy usage                                               Affected          % of customers that experience          Payback
                               TSL                                   kWh/yr       Installed    Discounted                   customers'   ------------------------------------------    period,
                                                                                    cost        operating        LCC          average                                  Net benefit  median years
                                                                                                  cost                     savings 2013$   Net cost %   No  impact %        %
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
1...............................................................         1,962         2,799         7,193         9,992            110              0            48            52           2.2
2...............................................................         1,747         2,845         7,051         9,896            161              1            20            79           2.4
3...............................................................         1,639         2,918         6,843         9,761            281              1            12            87           2.6
4...............................................................         1,532         3,000         6,778         9,778            230             16             0            84           3.5
5...............................................................         1,473         3,416         6,737        10,153           (145)            77             0            23           8.9
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

                                                            Table V.21--Summary LCC and PBP Results for SCU-A-Large-B Equipment Class
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                    Life-cycle cost, all customers 2013$                    Life-cycle cost savings
                                                                                 --------------------------------------------------------------------------------------------------
                                                                                                                              Affected         % of customers that experience          Payback
                                TSL                                 Energy usage                 Discounted                  customers'  ------------------------------------------    period,
                                                                       kWh/yr       Installed     operating        LCC         average                                              median years
                                                                                      cost          cost                       savings     Net cost %   No  impact %   Net benefit
                                                                                                                                2013$                                       %
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
1.................................................................         2,713         3,275        10,070        13,344           163             0            37            63           1.8
2.................................................................         2,414         3,345         9,685        13,030           400             0             1            99           1.6
3.................................................................         2,265         3,402         9,590        12,992           439             0             1            99           2.1
4.................................................................         2,141         3,854         9,500        13,355            71            54             0            46           6.5
5.................................................................         2,141         3,854         9,500        13,355            71            54             0            46           6.5
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

                                                            Table V.22--Summary LCC and PBP Results for IMH-A-Small-C Equipment Class
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                  Life-cycle cost, all customers 2013$                     Life-cycle cost savings
                                                                               ----------------------------------------------------------------------------------------------------
                                                                  Energy usage                                               Affected          % of customers that experience          Payback
                               TSL                                   kWh/yr       Installed    Discounted                   customers'   ------------------------------------------    period,
                                                                                    cost        operating        LCC          average                                  Net benefit  median years
                                                                                                  cost                     savings 2013$   Net cost %   No  impact %        %
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
1...............................................................         3,872         6,674         8,869        15,543            245              0            69            31           1.5
2...............................................................         3,658         6,709         8,723        15,432            292              0            58            42           1.6
3...............................................................         3,445         6,745         8,572        15,317            313              0            39            61           1.7
4...............................................................         3,445         6,745         8,572        15,317            313              0            39            61           1.7
5...............................................................         3,201         7,264         8,552        15,816           (165)            68            14            18           8.8
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
* Values in parentheses are negative values.

                                                            Table V.23--Summary LCC and PBP Results for IMH-A-Large-C Equipment Class
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                    Life-cycle cost, all customers 2013$                    Life-cycle cost savings
                                                                                 --------------------------------------------------------------------------------------------------
                                                                                                                              Affected         % of customers that experience          Payback
                                TSL                                 Energy usage                 Discounted                  customers'  ------------------------------------------    period,
                                                                       kWh/yr       Installed     operating        LCC         average                                              median years
                                                                                      cost          cost                       savings     Net cost %   No  impact %   Net benefit
                                                                                                                                2013$                                       %
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
1.................................................................         7,445         5,538        14,275        19,813           539             0            57            43           0.7
2.................................................................         7,445         5,538        14,275        19,813           539             0            57            43           0.7
3.................................................................         7,033         5,568        13,979        19,547           626             0            35            65           0.7
4.................................................................         7,033         5,568        13,979        19,547           626             0            35            65           0.7
5.................................................................         6,348         6,310        13,705        20,015            28            54             9            37           5.9
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

                                                             Table V.24--Summary LCC and PBP Results for RCU-Small-C Equipment Class
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                  Life-cycle cost, all customers 2013$                     Life-cycle cost savings
                                                                               ----------------------------------------------------------------------------------------------------
                                                                  Energy usage                                               Affected          % of customers that experience          Payback
                               TSL                                   kWh/yr       Installed    Discounted                   customers'   ------------------------------------------    period,
                                                                                    cost        operating        LCC          average                                  Net benefit  median years
                                                                                                  cost                     savings 2013$   Net cost %   No  impact %        %
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
1...............................................................         6,966         5,690         8,588        14,278            498              0            72            28           0.7
2...............................................................         6,580         5,758         8,319        14,078            448              0            44            55           1.2
3...............................................................         6,195         5,808         8,046        13,854            505              0            11            89           1.2
4...............................................................         6,195         5,808         8,046        13,854            505              0            11            89           1.2
5...............................................................         5,688         6,523         7,878        14,402            (73)            64             6            31           5.8
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
* Values in parentheses are negative values.

[[Page 4727]]

                                                            Table V.25--Summary LCC and PBP Results for SCU-A-Small-C Equipment Class
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                  Life-cycle cost, all customers 2013$                     Life-cycle cost savings
                                                                               ----------------------------------------------------------------------------------------------------
                                                                  Energy usage                                               Affected          % of customers that experience          Payback
                               TSL                                   kWh/yr       Installed    Discounted                   customers'   ------------------------------------------    period,
                                                                                    cost        operating        LCC          average                                  Net benefit  median years
                                                                                                  cost                     savings 2013$   Net cost %   No  impact %        %
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
1...............................................................         3,077         3,622         8,175        11,797            224              0            56            44           0.8
2...............................................................         2,907         3,646         8,059        11,705            278              0            47            53           1.1
3...............................................................         2,738         3,685         7,948        11,633            290              1            32            67           1.5
4...............................................................         2,738         3,685         7,948        11,633            290              1            32            67           1.5
5...............................................................         2,515         4,224         7,950        12,174           (268)            86             0            14          11.4
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
* Values in parentheses are negative values.

b. Life-Cycle Cost Subgroup Analysis
    As described in section IV.I, DOE estimated the impact of amended 
energy conservation standards for automatic commercial ice makers, at 
each TSL, on two customer subgroups--the foodservice sector and the 
lodging sector. For the automatic commercial ice makers, DOE has not 
distinguished between subsectors of the foodservice industry. In other 
words, DOE has been treating it as one sector as opposed to modeling 
limited or full service restaurants and other types of foodservice 
firms separately. Foodservice was chosen as one representative subgroup 
because of the large percentage of the industry represented by family-
owned or locally owned restaurants. Likewise, lodging was chosen due to 
the large percentage of the industry represented by locally owned or 
franchisee-owned hotels. DOE carried out two LCC subgroup analyses, one 
each for restaurants and lodging, by using the LCC spreadsheet 
described in chapter 8 of the final rule TSD, but with certain 
modifications. This included fixing the input for business type to the 
identified subgroup, which ensured that the discount rates and 
electricity price rates associated with only that subgroup were 
selected in the Monte Carlo simulations (see chapter 8 of the TSD). 
Another major change from the LCC analysis was an added assumption that 
the subgroups do not have access to national capital markets, which 
results in higher discount rates for the subgroups. The higher discount 
rates lead the subgroups to place a lower value on future savings and a 
higher value on the upfront equipment purchase costs. The LCC subgroup 
analysis is described in chapter 11 of the TSD.
    Table V.26 presents the comparison of mean LCC savings for the 
small business subgroup in foodservice sector with the national average 
values (LCC savings results from chapter 8 of the TSD). For TSLs 1-3, 
in most equipment classes, the LCC savings for the small business 
subgroup are only slightly different from the average, with some 
slightly higher and others slightly lower. Table V.27 presents the 
percentage change in LCC savings compared to national average values. 
DOE modeled all equipment classes in this analysis, although DOE 
believes it is likely that the very large equipment classes are not 
commonly used in foodservice establishments. For TSLs 1-3, the 
differences range from -7 percent for IMH-A-Large-B2 at TSLs 1 and 2, 
to +3 percent for the same class at TSL 3 and IMH-A-Small-B at TSL 2. 
For most equipment classes in Table V.27, the percentage change ranges 
from a decrease in LCC savings of less than 2 percent to an increase of 
2 percent. In summary, the differences are minor at TSLs 1-3.
    Table V.28 presents the comparison of median PBPs for the small 
business subgroup in the foodservice sector with national median values 
(median PBPs from chapter 8 of the TSD). The PBP values are the same as 
or shorter than the small business subgroup in all cases. This arises 
because the first-year operating cost savings--which are used for 
payback period--are higher, leading to a shorter payback. However, 
given their higher discount rates, these customers value future savings 
less, leading to lower LCC savings. First-year savings are higher 
because the foodservice electricity prices are higher than the average 
of all classes.
    Table V.29 presents the comparison of mean LCC savings for the 
small business subgroup in the lodging sector (hotels and casinos) with 
the national average values (LCC savings results from chapter 8 of the 
TSD). Table V.30 presents the percentage difference between LCC savings 
of the lodging sector customer subgroup and national average values. 
For lodging sector small business, LCC savings are lower across the 
board. For TSLs 1-3, the lodging subgroup LCC savings range from 9 to 
13 percent lower. The reason for this is that the energy price for 
lodging is slightly lower than the average of all commercial business 
types (97 percent of the average). This, combined with a higher 
discount rate, reduces the value of future operating and maintenance 
benefits as well as the present value of the benefits, thus resulting 
in lower LCC savings. For IMH-A-Small-B the difference exceeds 20 
percent, which is likely due to the higher installation cost for this 
class in combination with the much higher than average discount rate. 
The IMH-A-Large-B2 class is also significantly lower, in percentage 
terms. DOE notes that the difference is relatively small in terms of 
dollars; however, because the national average savings are small, the 
difference is significant in percentage terms. The lodging subgroup 
savings for IMH-A-Large-B2 are 88 percent lower than the average at 
TSLs 1 and 2, and 37 percent lower at TSL 3--the level recommended for 
the standard.
    Table V.31 presents the comparison of median PBPs for the small 
business subgroup in the lodging sector with national median values 
(median PBPs from chapter 8 of the TSD). The PBP values are slightly 
longer or the same for all equipment classes in the lodging small 
business subgroup at all TSLs. As noted above, the energy savings would 
be lower than a national average. Thus, the slightly lower median PBP 
appears to be a result of a narrower electricity saving results 
distribution that is close to but below the national average.

[[Page 4728]]

 Table V.26--Comparison of Mean LCC Savings for the Foodservice Sector Small Business Subgroup With the National
                                                 Average Values
----------------------------------------------------------------------------------------------------------------
                                                                          Mean LCC savings 2013$ *
          Equipment class                  Category       ------------------------------------------------------
                                                             TSL 1      TSL 2      TSL 3      TSL 4      TSL 5
----------------------------------------------------------------------------------------------------------------
IMH-W-Small-B.....................  Small Business.......        174        174        212        212      (535)
                                    All Business Types...        175        175        214        214      (534)
IMH-W-Med-B.......................  Small Business.......        312        312        312        168       (60)
                                    All Business Types...        308        308        308        165       (63)
IMH-W-Large-B.....................  Small Business.......         NA         NA         NA         NA      (169)
                                    All Business Types...         NA         NA         NA         NA      (172)
IMH-W-Large-B1....................  Small Business.......         NA         NA         NA         NA      (198)
                                    All Business Types...         NA         NA         NA         NA      (200)
IMH-W-Large-B2....................  Small Business.......         NA         NA         NA         NA       (77)
                                    All Business Types...         NA         NA         NA         NA       (80)
IMH-A-Small-B.....................  Small Business.......        139         75         78         78      (390)
                                    All Business Types...        136         72         77         77      (393)
IMH-A-Large-B.....................  Small Business.......        387        498        359        264        54
                                    All Business Types...        382        501        361        265        55
IMH-A-Large-B1....................  Small Business.......        444        575        404        292        43
                                    All Business Types...        439        580        407        294        45
IMH-A-Large-B2....................  Small Business.......         81         81        114        114       114
                                    All Business Types...         76         76        110        110       110
RCU-Large-B.......................  Small Business.......        754        754        754        424       150
                                    All Business Types...        748        748        748        418       144
RCU-Large-B1......................  Small Business.......        749        749        749        397       166
                                    All Business Types...        743        743        743        391       161
RCU-Large-B2......................  Small Business.......        832        832        832        832       (99)
                                    All Business Types...        820        820        820        820      (109)
SCU-W-Large-B.....................  Small Business.......        431        601        541        184       184
                                    All Business Types...        444        613        550        192       192
SCU-A-Small-B.....................  Small Business.......        112        162        276        226      (148)
                                    All Business Types...        110        161        281        230      (145)
SCU-A-Large-B.....................  Small Business.......        164        392        432         65        65
                                    All Business Types...        163        400        439         71        71
IMH-A-Small-C.....................  Small Business.......        248        296        317        317      (155)
                                    All Business Types...        245        292        313        313      (165)
IMH-A-Large-C.....................  Small Business.......        544        544        630        630        44
                                    All Business Types...        539        539        626        626        28
RCU-Small-C.......................  Small Business.......        503        453        509        509       (57)
                                    All Business Types...        498        448        505        505       (73)
SCU-A-Small-C.....................  Small Business.......        225        281        293        293      (257)
                                    All Business Types...        224        278        290        290      (268)
----------------------------------------------------------------------------------------------------------------
* Values in parenthesis are negative numbers.

Table V.27--Percentage Change in Mean LCC Savings for the Foodservice Sector Small Business Subgroup Compared to
                                            National Average Values *
----------------------------------------------------------------------------------------------------------------
                Equipment class                   TSL 1 (%)    TSL 2 (%)    TSL 3 (%)    TSL 4 (%)    TSL 5 (%)
----------------------------------------------------------------------------------------------------------------
IMH-W-Small-B..................................           -1           -1           -1           -1            0
IMH-W-Med-B....................................            1            1            1            2            5
IMH-W-Large-B..................................           NA           NA           NA           NA            1
IMH-W-Large-B1.................................           NA           NA           NA           NA            1
IMH-W-Large-B2.................................           NA           NA           NA           NA            4
IMH-A-Small-B..................................            2            3            2            2            1
IMH-A-Large-B..................................            1           -1           -1           -1           -2
IMH-A-Large-B1.................................            1           -1           -1           -1           -4
IMH-A-Large-B2.................................            7            7            3            3            3
RCU-Large-B....................................            1            1            1            1            4
RCU-Large-B1...................................            1            1            1            1            3
RCU-Large-B2...................................            1            1            1            1            9
SCU-W-Large-B..................................           -3           -2           -2           -4           -4
SCU-A-Small-B..................................            1            1           -2           -2           -2
SCU-A-Large-B..................................            1           -2           -2           -9           -9
IMH-A-Small-C..................................            1            1            1            1            6
IMH-A-Large-C..................................            1            1            1            1           57
RCU-Small-C....................................            1            1            1            1           22
SCU-A-Small-C..................................            1            1            1            1            4
----------------------------------------------------------------------------------------------------------------
* Negative percentage values imply decrease in LCC savings, and positive percentage values imply increase in LCC
  savings.

[[Page 4729]]

    Table V.28--Comparison of Median Payback Periods for the Foodservice Sector Small Business Subgroup With
                                             National Median Values
----------------------------------------------------------------------------------------------------------------
                                                                        Median payback period years
          Equipment class                  Category       ------------------------------------------------------
                                                             TSL 1      TSL 2      TSL 3      TSL 4      TSL 5
----------------------------------------------------------------------------------------------------------------
IMH-W-Small-B.....................  Small Business.......        2.3        2.3        2.7        2.7       12.7
                                    All Business Types...        2.5        2.5        2.7        2.7       13.4
IMH-W-Med-B.......................  Small Business.......        2.0        2.0        2.0        4.8        7.2
                                    All Business Types...        2.1        2.1        2.1        5.0        7.6
IMH-W-Large-B.....................  Small Business.......         NA         NA         NA         NA       10.0
                                    All Business Types...         NA         NA         NA         NA       10.6
IMH-W-Large-B1....................  Small Business.......         NA         NA         NA         NA       10.5
                                    All Business Types...         NA         NA         NA         NA       11.1
IMH-W-Large-B2....................  Small Business.......         NA         NA         NA         NA        8.4
                                    All Business Types...         NA         NA         NA         NA        8.9
IMH-A-Small-B.....................  Small Business.......        3.2        4.5        4.4        4.4       11.4
                                    All Business Types...        3.4        4.8        4.7        4.7       11.9
IMH-A-Large-B.....................  Small Business.......        2.1        2.3        2.2        3.7        5.3
                                    All Business Types...        2.2        2.4        2.3        3.9        5.6
IMH-A-Large-B1....................  Small Business.......        1.1        1.4        1.4        3.2        5.1
                                    All Business Types...        1.2        1.5        1.5        3.4        5.4
IMH-A-Large-B2....................  Small Business.......        7.0        7.0        6.5        6.5        6.5
                                    All Business Types...        7.4        7.4        6.9        6.9        6.9
RCU-Large-B.......................  Small Business.......        1.0        1.0        1.0        3.2        4.8
                                    All Business Types...        1.1        1.1        1.1        3.3        5.0
RCU-Large-B1......................  Small Business.......        0.9        0.9        0.9        3.2        4.7
                                    All Business Types...        0.9        0.9        0.9        3.4        4.9
RCU-Large-B2......................  Small Business.......        2.8        2.8        2.8        2.8        6.7
                                    All Business Types...        3.0        3.0        3.0        3.0        7.0
SCU-W-Large-B.....................  Small Business.......        1.1        1.5        1.7        4.9        4.9
                                    All Business Types...        1.1        1.6        1.8        5.1        5.1
SCU-A-Small-B.....................  Small Business.......        2.0        2.2        2.5        3.3        8.4
                                    All Business Types...        2.2        2.4        2.6        3.5        8.9
SCU-A-Large-B.....................  Small Business.......        1.7        1.6        2.0        6.2        6.2
                                    All Business Types...        1.8        1.6        2.1        6.5        6.5
IMH-A-Small-C.....................  Small Business.......        1.4        1.5        1.6        1.6        8.3
                                    All Business Types...        1.5        1.6        1.7        1.7        8.8
IMH-A-Large-C.....................  Small Business.......        0.6        0.6        0.7        0.7        5.5
                                    All Business Types...        0.7        0.7        0.7        0.7        5.9
RCU-Small-C.......................  Small Business.......        0.7        1.1        1.2        1.2        5.5
                                    All Business Types...        0.7        1.2        1.2        1.2        5.8
SCU-A-Small-C.....................  Small Business.......        0.7        1.0        1.4        1.4       10.6
                                    All Business Types...        0.8        1.1        1.5        1.5       11.4
----------------------------------------------------------------------------------------------------------------

 Table V.29--Comparison of LCC Savings for the Lodging Sector Small Business Subgroup With the National Average
                                                     Values
----------------------------------------------------------------------------------------------------------------
                                                                          Mean LCC savings 2013$ *
          Equipment class                  Category       ------------------------------------------------------
                                                             TSL 1      TSL 2      TSL 3      TSL 4      TSL 5
----------------------------------------------------------------------------------------------------------------
IMH-W-Small-B.....................  Small Business.......        155        155        189        189      (561)
                                    All Business Types...        175        175        214        214      (534)
IMH-W-Med-B.......................  Small Business.......        275        275        275        123      (109)
                                    All Business Types...        308        308        308        165       (63)
IMH-W-Large-B.....................  Small Business.......         NA         NA         NA         NA      (221)
                                    All Business Types...         NA         NA         NA         NA      (172)
IMH-W-Large-B1....................  Small Business.......         NA         NA         NA         NA      (244)
                                    All Business Types...         NA         NA         NA         NA      (200)
IMH-W-Large-B2....................  Small Business.......         NA         NA         NA         NA      (148)
                                    All Business Types...         NA         NA         NA         NA       (80)
IMH-A-Small-B.....................  Small Business.......        118         54         61         61      (423)
                                    All Business Types...        136         72         77         77      (393)
IMH-A-Large-B.....................  Small Business.......        337        443        321        211       (10)
                                    All Business Types...        382        501        361        265        55
IMH-A-Large-B1....................  Small Business.......        398        523        368        237       (25)
                                    All Business Types...        439        580        407        294        45
IMH-A-Large-B2....................  Small Business.......          9          9         70         70        70
                                    All Business Types...         76         76        110        110       110
RCU-Large-B.......................  Small Business.......        679        679        679        347        71
                                    All Business Types...        748        748        748        418       144

[[Page 4730]]

 
RCU-Large-B1......................  Small Business.......        676        676        676        322        90
                                    All Business Types...        743        743        743        391       161
RCU-Large-B2......................  Small Business.......        718        718        718        718      (205)
                                    All Business Types...        820        820        820        820      (109)
SCU-W-Large-B.....................  Small Business.......        404        553        494        129       129
                                    All Business Types...        444        613        550        192       192
SCU-A-Small-B.....................  Small Business.......         98        142        248        196      (182)
                                    All Business Types...        110        161        281        230      (145)
SCU-A-Large-B.....................  Small Business.......        146        361        392         18        18
                                    All Business Types...        163        400        439         71        71
IMH-A-Small-C.....................  Small Business.......        222        263        282        282      (189)
                                    All Business Types...        245        292        313        313      (165)
IMH-A-Large-C.....................  Small Business.......        493        493        571        571       (33)
                                    All Business Types...        539        539        626        626        28
RCU-Small-C.......................  Small Business.......        456        406        456        456      (133)
                                    All Business Types...        498        448        505        505       (73)
SCU-A-Small-C.....................  Small Business.......        204        253        261        261      (288)
                                    All Business Types...        224        278        290        290      (268)
----------------------------------------------------------------------------------------------------------------
* Values in parentheses are negative numbers.

  Table V.30--Percentage Change in Mean LCC Savings for the Lodging Sector Small Business Subgroup Compared to
                                            National Average Values *
----------------------------------------------------------------------------------------------------------------
                Equipment class                    TSL1 (%)     TSL2 (%)     TSL3 (%)     TSL4 (%)     TSL5 (%)
----------------------------------------------------------------------------------------------------------------
IMH-W-Small-B..................................          -11          -11          -12          -12           -5
IMH-W-Med-B....................................          -11          -11          -11          -26          -72
IMH-W-Large-B..................................           NA           NA           NA           NA          -29
IMH-W-Large-B1.................................           NA           NA           NA           NA          -22
IMH-W-Large-B2.................................           NA           NA           NA           NA          -84
IMH-A-Small-B..................................          -13          -25          -21          -21           -7
IMH-A-Large-B..................................          -12          -12          -11          -20         -118
IMH-A-Large-B1.................................           -9          -10          -10          -19         -155
IMH-A-Large-B2.................................          -88          -88          -37          -37          -37
RCU-Large-B....................................           -9           -9           -9          -17          -50
RCU-Large-B1...................................           -9           -9           -9          -18          -44
RCU-Large-B2...................................          -12          -12          -12          -12          -88
SCU-W-Large-B..................................           -9          -10          -10          -33          -33
SCU-A-Small-B..................................          -11          -11          -12          -15          -26
SCU-A-Large-B..................................          -10          -10          -11          -75          -75
IMH-A-Small-C..................................           -9          -10          -10          -10          -15
IMH-A-Large-C..................................           -9           -9           -9           -9         -215
RCU-Small-C....................................           -8           -9          -10          -10          -83
SCU-A-Small-C..................................           -9           -9          -10          -10          -7
----------------------------------------------------------------------------------------------------------------
* Negative percentage values imply decrease in LCC savings, and positive percentage values imply increase in LCC
  savings.

    Table V.31--Comparison of Median Payback Periods for the Lodging Sector Small Business Subgroup With the
                                             National Median Values
----------------------------------------------------------------------------------------------------------------
                                                                        Median payback period years
          Equipment class                  Category       ------------------------------------------------------
                                                             TSL 1      TSL 2      TSL 3      TSL 4      TSL 5
----------------------------------------------------------------------------------------------------------------
IMH-W-Small-B.....................  Small Business.......        2.5        2.5        2.8        2.8       13.5
                                    All Business Types...        2.5        2.5        2.7        2.7       13.4
IMH-W-Med-B.......................  Small Business.......        2.1        2.1        2.1        5.1        7.7
                                    All Business Types...        2.1        2.1        2.1        5.0        7.6
IMH-W-Large-B.....................  Small Business.......         NA         NA         NA         NA       10.7
                                    All Business Types...         NA         NA         NA         NA       10.6
IMH-W-Large-B1....................  Small Business.......         NA         NA         NA         NA       11.2
                                    All Business Types...         NA         NA         NA         NA       11.1
IMH-W-Large-B2....................  Small Business.......         NA         NA         NA         NA        9.0
                                    All Business Types...         NA         NA         NA         NA        8.9
IMH-A-Small-B.....................  Small Business.......        3.4        4.8        4.7        4.7       12.3

[[Page 4731]]

 
                                    All Business Types...        3.4        4.8        4.7        4.7       11.9
IMH-A-Large-B.....................  Small Business.......        2.2        2.4        2.3        3.9        5.7
                                    All Business Types...        2.2        2.4        2.3        3.9        5.6
IMH-A-Large-B1....................  Small Business.......        1.2        1.5        1.5        3.4        5.4
                                    All Business Types...        1.2        1.5        1.5        3.4        5.4
IMH-A-Large-B2....................  Small Business.......        7.5        7.5        6.9        6.9        6.9
                                    All Business Types...        7.4        7.4        6.9        6.9        6.9
RCU-Large-B.......................  Small Business.......        1.1        1.1        1.1        3.4        5.1
                                    All Business Types...        1.1        1.1        1.1        3.3        5.0
RCU-Large-B1......................  Small Business.......        0.9        0.9        0.9        3.5        5.0
                                    All Business Types...        0.9        0.9        0.9        3.4        4.9
RCU-Large-B2......................  Small Business.......        3.0        3.0        3.0        3.0        7.1
                                    All Business Types...        3.0        3.0        3.0        3.0        7.0
SCU-W-Large-B.....................  Small Business.......        1.1        1.6        1.8        5.2        5.2
                                    All Business Types...        1.1        1.6        1.8        5.1        5.1
SCU-A-Small-B.....................  Small Business.......        2.2        2.4        2.6        3.5        8.9
                                    All Business Types...        2.2        2.4        2.6        3.5        8.9
SCU-A-Large-B.....................  Small Business.......        1.8        1.6        2.1        6.6        6.6
                                    All Business Types...        1.8        1.6        2.1        6.5        6.5
IMH-A-Small-C.....................  Small Business.......        1.5        1.6        1.7        1.7        9.0
                                    All Business Types...        1.5        1.6        1.7        1.7        8.8
IMH-A-Large-C.....................  Small Business.......        0.7        0.7        0.7        0.7        6.0
                                    All Business Types...        0.7        0.7        0.7        0.7        5.9
RCU-Small-C.......................  Small Business.......        0.7        1.2        1.2        1.2        5.9
                                    All Business Types...        0.7        1.2        1.2        1.2        5.8
SCU-A-Small-C.....................  Small Business.......        0.8        1.1        1.5        1.5       11.7
                                    All Business Types...        0.8        1.1        1.5        1.5       11.4
----------------------------------------------------------------------------------------------------------------

2. Economic Impacts on Manufacturers
    DOE performed an MIA to estimate the impact of amended energy 
conservation standards on manufacturers of automatic commercial ice 
makers. The following section describes the expected impacts on 
manufacturers at each TSL. Chapter 12 of the final rule TSD explains 
the analysis in further detail.
a. Industry Cash Flow Analysis Results
    The following tables depict the financial impacts of the new and 
amended energy conservation standards on manufacturers of automatic 
commercial ice makers. The financial impacts are represented by changes 
in the industry net present value (INPV.) In addition, the tables 
depict the conversion costs that DOE estimates manufacturers would 
incur for all equipment classes at each TSL. The impact of the energy 
efficiency standards on industry cash flow were analyzed under two 
markup scenarios that correspond to the range of anticipated market 
responses to amended energy conservation standards.
    The first markup scenario assessed the lower bound of potential 
impacts (higher profitability). DOE modeled a preservation of gross 
margin percentage markup scenario, in which a uniform ``gross margin 
percentage'' markup is applied across all efficiency levels. In this 
scenario, DOE assumed that a manufacturer's absolute dollar markup 
would increase as production costs increase in the amended energy 
conservation standards case. Manufacturers have indicated that it is 
optimistic to assume that they would be able to maintain the same gross 
margin percentage markup as their production costs increase in response 
to a new or amended energy conservation standard, particularly at 
higher TSLs.
    The second markup scenario assessed the upper bound of potential 
impacts (lower profitability). DOE modeled the preservation of the EBIT 
markup scenario, which assumes that manufacturers would not be able to 
preserve the same overall gross margin, but instead would lower their 
markup for marginally compliant products to maintain a cost-competitive 
product offering and keep the same overall level of EBIT as in the base 
case. Table V.32 and Table V.33 show the range of potential INPV 
impacts for manufacturers of automatic commercial ice makers. The first 
table reflects the lower bound of impacts (higher profitability), and 
the second represents the upper bound of impacts (lower profitability).
    Each scenario results in a unique set of cash flows and 
corresponding industry values at each TSL. In the following discussion, 
the INPV results refer to the sum of discounted cash flows through 
2047, the difference in INPV between the base case and each standards 
case, and the total industry conversion costs required for each 
standards case.

[[Page 4732]]

   Table V.32--Manufacturer Impact Analysis for Automatic Commercial Ice Makers--Preservation of Gross Margin
                                          Percentage Markup Scenario *
----------------------------------------------------------------------------------------------------------------
                                                                            Trial standard level
                                   Units        Base case ------------------------------------------------------
                                                               1          2          3          4          5
----------------------------------------------------------------------------------------------------------------
INPV........................  2013$ millions.       121.6     115.0      112.3      109.5      109.3      109.8
Change in INPV..............  2013$ millions.  ..........      (6.6)      (9.3)     (12.1)     (12.3)     (11.8)
                              %..............  ..........      (5.4)      (7.7)     (10.0)     (10.1)      (9.7)
Product Conversion Costs....  2013$ millions.  ..........      12.3       18.1       23.8       28.1       40.3
Capital Conversion Costs....  2013$ millions.  ..........       0.2        0.6        1.3        2.0        3.9
                             -----------------------------------------------------------------------------------
    Total Conversion Costs..  2013$ millions.  ..........      12.6       18.7       25.1       30.0       44.1
----------------------------------------------------------------------------------------------------------------
* Values in parentheses are negative numbers.

    Table V.33--Manufacturer Impact Analysis for Automatic Commercial Ice Makers--Preservation of EBIT Markup
                                                   Scenario *
----------------------------------------------------------------------------------------------------------------
                                                                            Trial standard level
                                   Units        Base case ------------------------------------------------------
                                                               1          2          3          4          5
----------------------------------------------------------------------------------------------------------------
INPV........................  2013$ millions.       121.6     114.1      110.4      106.5      103.0       91.6
Change in INPV..............  2013$ millions.  ..........      (7.5)     (11.2)     (15.1)     (18.6)     (30.0)
                              %..............  ..........      (6.2)      (9.2)     (12.5)     (15.3)     (24.6)
Product Conversion Costs....  2013$ millions.  ..........      12.3       18.1       23.8       28.1       40.3
Capital Conversion Costs....  2013$ millions.  ..........       0.2        0.6        1.3        2.0        3.9
                             -----------------------------------------------------------------------------------
    Total Conversion Costs..  2013$ millions.  ..........      12.6       18.7       25.1       30.0       44.1
----------------------------------------------------------------------------------------------------------------
* Values in parentheses are negative numbers.

    Beyond impacts on INPV, DOE includes a comparison of free cash flow 
between the base case and the standards case at each TSL in the year 
before amended standards take effect to provide perspective on the 
short-run cash flow impacts in the discussion of the following results.
    At TSL 1, DOE estimates impacts on INPV for manufacturers of 
automatic commercial ice makers to range from -$7.5 million to -$6.6 
million, or a change in INPV of -6.2 percent to -5.4 percent. At this 
TSL, industry free cash flow is estimated to decrease to $6.7 million, 
or a drop of 35.7 percent, compared to the base-case value of $10.4 
million in the year before the compliance date (2017).
    DOE estimates that approximately 27 percent of all batch commercial 
ice makers and 29 percent of all continuous commercial ice makers on 
the market will require redesign to meet standards at TSL 1. At this 
TSL DOE expects capital and product conversion costs of $0.2 million 
and $12.3 million, respectively. Combined, the total conversion cost is 
$12.5 million.
    At TSL 2, DOE estimates impacts on INPV for manufacturers of 
automatic commercial ice makers to range from -$11.2 million to -$9.3 
million, or a change in INPV of -9.2 percent to -7.7 percent. At this 
TSL, industry free cash flow is estimated to decrease to $4.8 million, 
or a drop of 53.5 percent, compared to the base-case value of $10.4 
million in the year before the compliance date (2017).
    DOE estimates that approximately 39 percent of all batch commercial 
ice makers and 41 percent of all continuous commercial ice makers on 
the market will require redesign to meet standards at TSL 2. At this 
TSL, DOE expects industry capital and product conversion costs of $0.6 
million and of $18.1 million, respectively. Combined, the total 
conversion cost is $18.7 million, 48 percent higher than those incurred 
by industry at TSL 1.
    At TSL 3, DOE estimates impacts on INPV for manufacturers of 
automatic commercial ice makers to range from -$15.1 million to -$12.1 
million, or a change in INPV of -12.5 percent to -10.0 percent. At this 
TSL, industry free cash flow is estimated to decrease to $2.9 million, 
or a drop of 72.4 percent, compared to the base-case value of $10.4 
million in the year before the compliance date (2017).
    DOE estimates that approximately 51 percent of all batch commercial 
ice makers and 55 percent of all continuous commercial ice makers on 
the market will require redesign to meet standards at TSL 3. At this 
TSL, DOE expects industry capital and product conversion costs of $23.8 
million and of $1.3 million, respectively. Combined, the total 
conversion cost is $25.1 million, 34 percent higher than those incurred 
by industry at TSL 2.
    At TSL 4, DOE estimates impacts on INPV for manufacturers of 
automatic commercial ice makers to range from -$18.6 million to -$12.3 
million, or a change in INPV of -15.3 percent to -10.1 percent. At this 
TSL, industry free cash flow is estimated to decrease to $0.9 million, 
or a drop of 91.1 percent, compared to the base-case value of $10.4 
million in the year before the compliance date (2017).
    DOE estimates that approximately 66 percent of all batch commercial 
ice makers and 55 percent of all continuous commercial ice makers on 
the market will require redesign to meet standards at TSL 4. 
Additionally, for four equipment classes, there is only one 
manufacturer with products that currently meet the standard. At this 
TSL, DOE expects industry capital and product conversion costs of $2.0 
million and of $28.1 million, respectively. Combined, the total 
conversion cost is $30.0 million, 20 percent higher than those incurred 
by industry at TSL 3.
    At TSL 5, DOE estimates impacts on INPV for manufacturers of 
automatic commercial ice makers to range from -$30.0 million to -$11.8 
million, or a change in INPV of -24.6 percent to -9.7 percent. At this 
TSL, industry free cash flow is estimated to decrease to -$5.3 million, 
or a drop of 151.1 percent, compared to the base-case

[[Page 4733]]

value of $10.4 million in the year before the compliance date (2017).
    DOE estimates that approximately 84 percent of all batch commercial 
ice makers and 78 percent of all continuous commercial ice makers on 
the market will require redesign to meet standards at TSL 5. 
Additionally, for five equipment classes, there is only one 
manufacturer with products that currently meet the standard. At this 
TSL, DOE expects industry capital and product conversion costs of $3.9 
million and of $40.3 million, respectively. Combined, the total 
conversion cost is $44.1 million, 47 percent higher than those incurred 
by industry at TSL 4.
b. Impacts on Direct Employment
    DOE used the GRIM to estimate the domestic labor expenditures and 
number of domestic production workers in the base case and at each TSL 
from 2015 through 2047. DOE used statistical data from the most recent 
U.S Census Bureau's 2011 Annual Survey of Manufactures (ASM), the 
results of the engineering analysis, and interviews with manufacturers 
to determine the inputs necessary to calculate industry-wide labor 
expenditures and domestic employment levels. Labor expenditures related 
to the manufacture of a product are a function of the labor intensity 
of the product, the sales volume, and an assumption that wages in real 
terms remain constant.
    In the GRIM, DOE used the labor content of each product and the 
manufacturing production costs from the engineering analysis to 
estimate the annual labor expenditures in the automatic commercial ice 
maker industry. The total labor expenditures in the GRIM were then 
converted to domestic production employment levels by dividing 
production labor expenditures by the annual payment per production 
worker (production worker hours multiplied by the labor rate found in 
the U.S. Census Bureau's ASM).
    The estimates of production workers in this section cover workers, 
including line-supervisors, who are directly involved in fabricating 
and assembling automatic commercial ice makers within an original 
equipment manufacturer (OEM) facility. Workers performing services that 
are closely associated with production operations, such as material 
handling with a forklift, are also included as production labor.
    The employment impacts shown in Table V.34 represent the potential 
production employment changes that could result following the 
compliance date of new and amended energy conservation standards. The 
upper end of the employment results in Table V.34 estimates the maximum 
increase in the number of production workers after implementation of 
new or amended energy conservation standards and it assumes that 
manufacturers continue to produce the same scope of covered products in 
the U.S. The lower end of employment results in Table V.34 represent 
the maximum decrease to the total number of U.S. production workers in 
the industry due to manufacturers moving production outside of the U.S. 
While the results present a range of employment impacts following the 
compliance date of the new and amended energy conservation standards, 
the following discussion also includes a qualitative discussion of the 
likelihood of negative employment impacts at the various TSLs. Finally, 
the employment impacts shown are independent of the employment impacts 
from the broader U.S. economy, which are documented in chapter 13 of 
the final rule TSD.
    DOE estimates that in the absence of amended energy conservation 
standards, there would be 389 domestic production workers involved in 
manufacturing automatic commercial ice makers in 2018. Using 2011 
Census Bureau data and interviews with manufacturers, DOE estimates 
that approximately 84 percent of automatic commercial ice makers sold 
in the United States are manufactured domestically. Table V.34 shows 
the range of the impacts of potential amended energy conservation 
standards on U.S. production workers in the automatic commercial ice 
maker industry.

 Table V.34--Potential Changes in the Total Number of Domestic Automatic Commercial Ice Maker Production Workers
                                                     in 2018
----------------------------------------------------------------------------------------------------------------
                                     Base case      TSL 1        TSL 2        TSL 3        TSL 4        TSL 5
----------------------------------------------------------------------------------------------------------------
Total Number of Domestic                    389          391          402          414          418          444
 Production Workers in 2018
 (without changes in production
 locations).......................
Potential Changes in Domestic       ...........   (389) to 2  (389) to 13  (389) to 25  (389) to 29  (389) to 55
 Production Workers in 2018 *.....
----------------------------------------------------------------------------------------------------------------
* DOE presents a range of potential employment impacts. Values in parentheses are negative numbers.

    At all TSLs, most of the design options analyzed by DOE do not 
greatly alter the labor content of the final product. For example, the 
use of higher efficiency compressors or fan motors involve one-time 
changes to the final product but do not significantly change the amount 
of production hours required for the final assembly. One manufacturer 
suggested that their domestic production employment levels would only 
change if market demand contracted following higher overall prices. 
However, more than one manufacturer suggested that where they already 
have overseas manufacturing capabilities, they would consider moving 
additional manufacturing to those facilities if they felt the need to 
offset a significant rise in materials costs. Provided the changes in 
materials costs do not support the relocation of manufacturing 
facilities, DOE would expect only modest changes to domestic 
manufacturing employment balancing additional requirements for assembly 
labor with the effects of price elasticity.
c. Impacts on Manufacturing Capacity
    According to the majority of automatic commercial ice maker 
manufacturers interviewed, new or amended energy conservation standards 
that require modest changes to product efficiency will not 
significantly affect manufacturers' production capacities. Any redesign 
of automatic commercial ice makers would not change the fundamental 
assembly of the equipment, but manufacturers do anticipate some 
potential for additional lead time immediately following standards 
associated with changes in sourcing of higher efficiency components, 
which may be supply constrained.
    One manufacturer cited the possibility of a 3- to 6-month shutdown 
in the event that amended standards were set high enough to require 
retooling of their entire product line. Most of the design options that 
were evaluated are already available on the market as product options. 
Thus, DOE

[[Page 4734]]

believes that, short of widespread retooling, manufacturers will be 
able to maintain manufacturing capacity levels and continue to meet 
market demand under amended energy conservation standards.
d. Impacts on Subgroups of Manufacturers
    Small business, low-volume, niche equipment manufacturers, and 
manufacturers exhibiting a cost structure substantially different from 
the industry average could be affected disproportionately. As discussed 
in section IV.J, using average cost assumptions to develop an industry 
cash flow estimate is inadequate to assess differential impacts among 
manufacturer subgroups.
    For automatic commercial ice makers, DOE identified and evaluated 
the impact of amended energy conservation standards on one subgroup: 
small manufacturers. The SBA defines a ``small business'' as having 
fewer than 750 employees for NAICS 333415, ``Air-Conditioning and Warm 
Air Heating Equipment and Commercial and Industrial Refrigeration 
Equipment Manufacturing,'' which includes ice-making machinery 
manufacturing. DOE identified seven manufacturers in the automatic 
commercial ice makers industry that meet this definition.
    For a discussion of the impacts on the small manufacturer subgroup, 
see the regulatory flexibility analysis in section VI.B of this 
preamble and chapter 12 of the final rule TSD.
e. Cumulative Regulatory Burden
    While any one regulation may not impose a significant burden on 
manufacturers, the combined effects of recent or impending regulations 
may have serious consequences for some manufacturers, groups of 
manufacturers, or an entire industry. Assessing the impact of a single 
regulation may overlook this cumulative regulatory burden. In addition 
to energy conservation standards, other regulations can significantly 
affect manufacturers' financial operations. Multiple regulations 
affecting the same manufacturer can strain profits and lead companies 
to abandon product lines or markets with lower expected future returns 
than competing products. For these reasons, DOE conducts an analysis of 
cumulative regulatory burden as part of its rulemakings pertaining to 
equipment efficiency.
    For the cumulative regulatory burden analysis, DOE looks at other 
regulations that could affect ACIM manufacturers that will take effect 
approximately 3 years before or after the 2018 compliance date of 
amended energy conservation standards for these products. In written 
comments, manufacturers cited Federal regulations on equipment other 
than automatic commercial ice makers that contribute to their 
cumulative regulatory burden. The compliance years and expected 
industry conversion costs of relevant amended energy conservation 
standards are indicated in Table V.35.

Table V.35--Compliance Dates and Expected Conversion Expenses of Federal
 Energy Conservation Standards Affecting Automatic Commercial Ice Maker
                              Manufacturers
------------------------------------------------------------------------
                                                        Estimated total
  Federal energy conservation        Approximate           industry
           standards               compliance date    conversion expense
------------------------------------------------------------------------
Commercial refrigeration                       2017     $184.0M, (2012$)
 equipment, 79 FR 17725 (March
 28, 2014).....................
Walk-in Coolers and Freezers,                  2017    $33.6.0M, (2012$)
 79 FR 32049 (June 3, 2014)....
Miscellaneous Refrigeration                     TBD                  TBD
 Equipment *...................
------------------------------------------------------------------------
* The final rule for this energy conservation standard has not been
  published. The compliance date and analysis of conversion costs have
  not been finalized at this time.

    DOE discusses these and other requirements and includes the full 
details of the cumulative regulatory burden analysis in chapter 12 of 
the final rule TSD.
3. National Impact Analysis
a. Amount and Significance of Energy Savings
    DOE estimated the NES by calculating the difference in annual 
energy consumption for the base-case scenario and standards-case 
scenario at each TSL for each equipment class and summing up the annual 
energy savings for the automatic commercial ice maker equipment 
purchased during the 30-year 2018 through 2047 analysis period. Energy 
impacts include the 30-year period, plus the life of equipment 
purchased in the last year of the analysis, or roughly 2018 through 
2057. The energy consumption calculated in the NIA is full-fuel-cycle 
(FFC) energy, which quantifies savings beginning at the source of 
energy production. DOE also reports primary or source energy that takes 
into account losses in the generation and transmission of electricity. 
FFC and primary energy are discussed in section IV.H.3.
    Table V.36 presents the source NES for all equipment classes at 
each TSL and the sum total of NES for each TSL.
    Table V.37 presents the energy savings at each TSL for each 
equipment class in the form of percentage of the cumulative energy use 
of the equipment stock in the base-case scenario.

          Table V.36--Cumulative National Energy Savings at Source for Equipment Purchased in 2018-2047
                                                     [Quads]
----------------------------------------------------------------------------------------------------------------
                                                                       Standard level * **
                Equipment class                 ----------------------------------------------------------------
                                                    TSL 1        TSL 2        TSL 3        TSL 4        TSL 5
----------------------------------------------------------------------------------------------------------------
IMH-W-Small-B..................................        0.002        0.002        0.004        0.004        0.009
IMH-W-Med-B....................................        0.005        0.005        0.005        0.008        0.010
IMH-W-Large-B [dagger].........................        0.000        0.000        0.000        0.000        0.002
IMH-W-Large-B1.................................        0.000        0.000        0.000        0.000        0.001
IMH-W-Large-B2.................................        0.000        0.000        0.000        0.000        0.001
IMH-A-Small-B..................................        0.011        0.023        0.037        0.037        0.071
IMH-A-Large-B [dagger].........................        0.019        0.034        0.039        0.058        0.075

[[Page 4735]]

 
IMH-A-Large-B1.................................        0.016        0.031        0.035        0.055        0.071
IMH-A-Large-B2.................................        0.002        0.002        0.003        0.003        0.003
RCU-Large-B [dagger]...........................        0.015        0.015        0.015        0.029        0.037
RCU-Large-B1...................................        0.014        0.014        0.014        0.027        0.035
RCU-Large-B2...................................        0.001        0.001        0.001        0.001        0.002
SCU-W-Large-B..................................        0.000        0.001        0.001        0.001        0.001
SCU-A-Small-B..................................        0.007        0.018        0.024        0.032        0.036
SCU-A-Large-B..................................        0.006        0.014        0.019        0.023        0.023
IMH-A-Small-C..................................        0.002        0.004        0.006        0.006        0.009
IMH-A-Large-C..................................        0.002        0.002        0.003        0.003        0.006
RCU-Small-C....................................        0.001        0.002        0.003        0.003        0.005
SCU-A-Small-C..................................        0.006        0.010        0.015        0.015        0.023
                                                ----------------------------------------------------------------
    Total......................................        0.077        0.130        0.171        0.219        0.307
----------------------------------------------------------------------------------------------------------------
* A value equal to 0.000 means the NES rounds to less than 0.001 quads.
** Numbers may not add to totals, due to rounding.
[dagger] IMH-W-Large-B, IMH-A-Large-B, and RCU-Large-B results are the sum of the results for the two typical
  units denoted by B1 and B2.

   Table V.37--Cumulative Source Energy Savings by TSL as a Percentage of Cumulative Baseline Energy Usage of
                         Automatic Commercial Ice Maker Equipment Purchased in 2018-2047
----------------------------------------------------------------------------------------------------------------
                                     Base case               TSL Savings as percent of baseline usage
                                       energy   ----------------------------------------------------------------
          Equipment class              usage
                                      (quads)     TSL 1 (%)    TSL 2 (%)    TSL 3 (%)    TSL 4 (%)    TSL 5 (%)
----------------------------------------------------------------------------------------------------------------
IMH-W-Small-B.....................        0.064            4            4            6            6           15
IMH-W-Med-B.......................        0.089            5            5            5            9           12
IMH-W-Large-B *...................        0.028            0            0            0            0            6
IMH-W-Large-B1....................        0.018            0            0            0            0            7
IMH-W-Large-B2....................        0.010            0            0            0            0            6
IMH-A-Small-B.....................        0.467            2            5            8            8           15
IMH-A-Large-B *...................        0.644            3            5            6            9           12
IMH-A-Large-B1....................        0.495            3            6            7           11           14
IMH-A-Large-B2....................        0.149            2            2            2            2            2
RCU-Large-B *.....................        0.368            4            4            4            8           10
RCU-Large-B1......................        0.343            4            4            4            8           10
RCU-Large-B2......................        0.026            4            4            4            4            7
SCU-W-Large-B.....................        0.004            7           14           18           23           23
SCU-A-Small-B.....................        0.150            5           12           16           21           24
SCU-A-Large-B.....................        0.102            6           14           19           23           23
IMH-A-Small-C.....................        0.071            3            5            8            8           12
IMH-A-Large-C.....................        0.044            4            4            7            7           14
RCU-Small-C.......................        0.031            3            6           10           10           16
SCU-A-Small-C.....................        0.145            4            7           10           10           16
                                   -----------------------------------------------------------------------------
    Total.........................        2.206            3            6            8           10           14
----------------------------------------------------------------------------------------------------------------
* IMH-W-Large-B, IMH-A-Large-B, and RCU-Large-B results are the sum of the results for the 2 typical units
  denoted by B1 and B2.

    Table V.38 presents energy savings at each TSL for each equipment 
class with the FFC adjustment. The NES increases from 0.081 quads at 
TSL 1 to 0.321 quads at TSL 5.

  Table V.38--Cumulative National Energy Savings Including Full-Fuel-Cycle for Equipment Purchased in 2018-2047
                                                     [Quads]
----------------------------------------------------------------------------------------------------------------
                                                                       Standard level * **
                Equipment class                 ----------------------------------------------------------------
                                                    TSL 1        TSL 2        TSL 3        TSL 4        TSL 5
----------------------------------------------------------------------------------------------------------------
IMH-W-Small-B..................................        0.002        0.002        0.004        0.004        0.010
IMH-W-Med-B....................................        0.005        0.005        0.005        0.008        0.011
IMH-W-Large-B [dagger].........................        0.000        0.000        0.000        0.000        0.002

[[Page 4736]]

 
IMH-W-Large-B1.................................        0.000        0.000        0.000        0.000        0.001
IMH-W-Large-B2.................................        0.000        0.000        0.000        0.000        0.001
IMH-A-Small-B..................................        0.011        0.024        0.039        0.039        0.075
IMH-A-Large-B [dagger].........................        0.020        0.035        0.040        0.061        0.078
IMH-A-Large-B1.................................        0.017        0.033        0.037        0.057        0.075
IMH-A-Large-B2.................................        0.003        0.003        0.004        0.004        0.004
RCU-Large-B [dagger]...........................        0.016        0.016        0.016        0.030        0.038
RCU-Large-B1...................................        0.015        0.015        0.015        0.029        0.037
RCU-Large-B2...................................        0.001        0.001        0.001        0.001        0.002
SCU-W-Large-B..................................        0.000        0.001        0.001        0.001        0.001
SCU-A-Small-B..................................        0.008        0.019        0.026        0.033        0.037
SCU-A-Large-B..................................        0.006        0.015        0.020        0.024        0.024
IMH-A-Small-C..................................        0.002        0.004        0.006        0.006        0.009
IMH-A-Large-C..................................        0.002        0.002        0.003        0.003        0.007
RCU-Small-C....................................        0.001        0.002        0.003        0.003        0.005
SCU-A-Small-C..................................        0.007        0.011        0.016        0.016        0.024
                                                ----------------------------------------------------------------
    Total......................................        0.081        0.136        0.179        0.229        0.321
----------------------------------------------------------------------------------------------------------------
* A value equal to 0.000 means the NES rounds to less than 0.001 quads
** Numbers may not add to totals due to rounding.
[dagger] IMH-W-Large-B, IMH-A-Large-B, and RCU-Large-B results are the sum of the results for the 2 typical
  units denoted by B1 and B2.

    Circular A-4 requires agencies to present analytical results, 
including separate schedules of the monetized benefits and costs that 
show the type and timing of benefits and costs. Circular A-4 also 
directs agencies to consider the variability of key elements underlying 
the estimates of benefits and costs. For this rulemaking, DOE undertook 
a sensitivity analysis using 9, rather than 30, years of product 
shipments. The choice of a 9-year period is a proxy for the timeline in 
EPCA for the review of certain energy conservation standards and 
potential revision of and compliance with such revised standards.\73\ 
The review timeframe established in EPCA generally is not synchronized 
with the product lifetime, product manufacturing cycles or other 
factors specific to automatic commercial ice makers. Thus, this 
information is presented for informational purposes only and is not 
indicative of any change in DOE's analytical methodology. The NES 
results based on a 9-year analysis period are presented in Table V.39 . 
The impacts are counted over the lifetime of equipment purchased in 
2018 through 2026.
---------------------------------------------------------------------------

    \73\ For automatic commercial ice makers, DOE is required to 
review standards at least every five years after the effective date 
of any amended standards. (42 U.S.C. 6313(d)(3)(B)) If new standards 
are promulgated, EPCA requires DOE to provide manufacturers a 
minimum of 3 and a maximum of 5 years to comply with the standards. 
(42 U.S.C. 6313(d)(3)(C)) In addition, for certain other types of 
commercial equipment that are not specified in 42 U.S.C. 6311(1)(B)-
(G), EPCA requires DOE to review its standards at least once every 6 
years (42 U.S.C. 6295(m)(1) and 6316(a)), and either a 3-year or a 
5-year period after any new standard is promulgated before 
compliance is required. (42 U.S.C. 6295(m)(4) and 6316(a)) As a 
result, DOE's standards for automatic commercial ice makers can be 
expected to be in effect for 8 to 10 years between compliance dates, 
and its standards governing certain other commercial equipment, the 
period is 9 to 11 years. A 9-year analysis was selected as 
representative of the time between standard revisions.

 Table V.39--National Full-Fuel-Cycle Energy Savings for 9-Year Analysis Period for Equipment Purchased in 2018-
                                                      2026
                                                     [Quads]
----------------------------------------------------------------------------------------------------------------
                                                                       Standard level * **
                Equipment class                 ----------------------------------------------------------------
                                                    TSL 1        TSL 2        TSL 3        TSL 4        TSL 5
----------------------------------------------------------------------------------------------------------------
IMH-W-Small-B..................................        0.001        0.001        0.001        0.001        0.003
IMH-W-Med-B....................................        0.001        0.001        0.001        0.002        0.003
IMH-W-Large-B [dagger].........................        0.000        0.000        0.000        0.000        0.001
IMH-W-Large-B1.................................        0.000        0.000        0.000        0.000        0.000
IMH-W-Large-B2.................................        0.000        0.000        0.000        0.000        0.000
IMH-A-Small-B..................................        0.003        0.007        0.012        0.012        0.022
IMH-A-Large-B [dagger].........................        0.006        0.011        0.012        0.018        0.023
IMH-A-Large-B1.................................        0.005        0.010        0.011        0.017        0.022
IMH-A-Large-B2.................................        0.001        0.001        0.001        0.001        0.001
RCU-Large-B [dagger]...........................        0.005        0.005        0.005        0.009        0.012
RCU-Large-B1...................................        0.005        0.005        0.005        0.009        0.011
RCU-Large-B2...................................        0.000        0.000        0.000        0.000        0.001
SCU-W-Large-B..................................        0.000        0.000        0.000        0.000        0.000
SCU-A-Small-B..................................        0.002        0.006        0.008        0.010        0.011

[[Page 4737]]

 
SCU-A-Large-B..................................        0.002        0.004        0.006        0.007        0.007
IMH-A-Small-C..................................        0.001        0.001        0.002        0.002        0.003
IMH-A-Large-C..................................        0.001        0.001        0.001        0.001        0.002
RCU-Small-C....................................        0.000        0.001        0.001        0.001        0.002
SCU-A-Small-C..................................        0.002        0.003        0.005        0.005        0.007
                                                ----------------------------------------------------------------
    Total......................................        0.024        0.041        0.054        0.069        0.097
----------------------------------------------------------------------------------------------------------------
* A value equal to 0.000 means the NES rounds to less than 0.001 quads.
** Numbers may not add to totals due to rounding.
[dagger] IMH-W-Large-B, IMH-A-Large-B, and RCU-Large-B results are the sum of the results for the 2 typical
  units denoted by B1 and B2.

b. Net Present Value of Customer Costs and Benefits
    DOE estimated the cumulative NPV to the Nation of the total savings 
for the customers that would result from potential standards at each 
TSL. In accordance with OMB guidelines on regulatory analysis (OMB 
Circular A-4, section E, September 17, 2003), DOE calculated NPV using 
both a 7-percent and a 3-percent real discount rate. The 7-percent rate 
is an estimate of the average before-tax rate of return on private 
capital in the U.S. economy, and reflects the returns on real estate 
and small business capital, including corporate capital. DOE used this 
discount rate to approximate the opportunity cost of capital in the 
private sector, because recent OMB analysis has found the average rate 
of return on capital to be near this rate. In addition, DOE used the 3-
percent rate to capture the potential effects of amended standards on 
private consumption. This rate represents the rate at which society 
discounts future consumption flows to their present value. It can be 
approximated by the real rate of return on long-term government debt 
(i.e., yield on Treasury notes minus annual rate of change in the CPI), 
which has averaged about 3 percent on a pre-tax basis for the last 30 
years.
    Table V.40 and Table V.41 show the customer NPV results for each of 
the TSLs DOE considered for automatic commercial ice makers at both 7-
percent and 3-percent discount rates, respectively. In each case, the 
impacts cover the expected lifetime of equipment purchased from 2018 
through 2047. Detailed NPV results are presented in chapter 10 of the 
final rule TSD.
    The NPV results at a 7-percent discount rate for TSL 5 were 
negative for 9 classes, and also for one of the typical size units of a 
large batch equipment class for which the class total was positive. In 
all cases the TSL 5 NPV was significantly lower than the TSL 3 results. 
This is consistent with the LCC analysis results for TSL 5, which 
showed significant increase in LCC and significantly higher PBPs that 
were in some cases greater than the average equipment lifetimes. 
Efficiency levels for TSL 4 were chosen to correspond to the highest 
efficiency level with a positive NPV for all classes at a 7-percent 
discount rate. Similarly, the criteria for choice of efficiency levels 
for TSL 3, TSL 2, and TSL 1 were such that the NPV values for all the 
equipment classes show positive values. The criterion for TSL 3 was to 
select efficiency levels with the highest NPV at a 7-percent discount 
rate. Consequently, the total NPV for automatic commercial ice makers 
was highest for TSL 3, with a value of $0.430 billion (2013$) at a 7-
percent discount rate. TSL 4 showed the second highest total NPV, with 
a value of $0.337 billion (2013$) at a 7-percent discount rate. TSL 1, 
TSL 2 and TSL 5 have a total NPV lower than TSL 3 or 4.

         Table V.40--Net Present Value at a 7-Percent Discount Rate for Equipment Purchased in 2018-2047
                                                 [Billion 2013$]
----------------------------------------------------------------------------------------------------------------
                                                                       Standard level *
               Equipment class               -------------------------------------------------------------------
                                                  TSL 1         TSL 2        TSL 3        TSL 4         TSL 5
----------------------------------------------------------------------------------------------------------------
IMH-W-Small-B...............................        0.006         0.006         0.011        0.011       (0.049)
IMH-W-Med-B.................................        0.010         0.010         0.010        0.006       (0.008)
IMH-W-Large-B **............................        0.000         0.000         0.000        0.000       (0.002)
IMH-W-Large-B1..............................        0.000         0.000         0.000        0.000       (0.002)
IMH-W-Large-B2..............................        0.000         0.000         0.000        0.000       (0.000)
IMH-A-Small-B...............................        0.017         0.017         0.036        0.036       (0.238)
IMH-A-Large-B **............................        0.043         0.109         0.120        0.109        0.021
IMH-A-Large-B1..............................        0.043         0.109         0.119        0.107        0.020
IMH-A-Large-B2..............................       (0.000)       (0.000)        0.001        0.001        0.001
RCU-Large-B **..............................        0.042         0.042         0.042        0.035        0.007
RCU-Large-B1................................        0.040         0.040         0.040        0.033        0.008
RCU-Large-B2................................        0.002         0.002         0.002        0.002       (0.001)
SCU-W-Large-B...............................        0.002         0.002         0.003        0.001        0.001
SCU-A-Small-B...............................        0.016         0.037         0.076        0.068       (0.060)
SCU-A-Large-B...............................        0.014         0.059         0.064        0.004        0.004
IMH-A-Small-C...............................        0.006         0.009         0.014        0.014       (0.014)
IMH-A-Large-C...............................        0.005         0.005         0.009        0.009       (0.001)
RCU-Small-C.................................        0.002         0.004         0.008        0.008       (0.003)

[[Page 4738]]

 
SCU-A-Small-C...............................        0.018         0.027         0.036        0.036       (0.062)
                                             -------------------------------------------------------------------
    Total...................................        0.183         0.328         0.430        0.337       (0.406)
----------------------------------------------------------------------------------------------------------------
* A value equal to 0.000 means the NPV rounds to less than $0.001 (2013$). Values in parentheses are negative
  numbers.
** IMH-W-Large-B, IMH-A-Large-B, and RCU-Large-B results are the sum of the results for the 2 typical units
  denoted by B1 and B2.

         Table V.41--Net Present Value at a 3-Percent Discount Rate for Equipment Purchased in 2018-2047
                                                 [Billion 2013$]
----------------------------------------------------------------------------------------------------------------
                                                                       Standard level *
               Equipment class               -------------------------------------------------------------------
                                                  TSL 1         TSL 2        TSL 3        TSL 4         TSL 5
----------------------------------------------------------------------------------------------------------------
IMH-W-Small-B...............................        0.014         0.014         0.025        0.025       (0.074)
IMH-W-Med-B.................................        0.022         0.022         0.022        0.016       (0.008)
IMH-W-Large-B **............................        0.000         0.000         0.000        0.000       (0.003)
IMH-W-Large-B1..............................        0.000         0.000         0.000        0.000       (0.003)
IMH-W-Large-B2..............................        0.000         0.000         0.000        0.000       (0.000)
IMH-A-Small-B...............................        0.039         0.046         0.092        0.092       (0.360)
IMH-A-Large-B **............................        0.091         0.234         0.259        0.271        0.122
IMH-A-Large-B1..............................        0.090         0.233         0.254        0.266        0.117
IMH-A-Large-B2..............................        0.001         0.001         0.005        0.005        0.005
RCU-Large-B **..............................        0.088         0.088         0.088        0.084        0.039
RCU-Large-B1................................        0.084         0.084         0.084        0.080        0.039
RCU-Large-B2................................        0.004         0.004         0.004        0.004       (0.001)
SCU-W-Large-B...............................        0.003         0.005         0.005        0.002        0.002
SCU-A-Small-B...............................        0.035         0.079         0.169        0.159       (0.075)
SCU-A-Large-B...............................        0.030         0.127         0.138        0.031        0.031
IMH-A-Small-C...............................        0.012         0.019         0.030        0.030       (0.022)
IMH-A-Large-C...............................        0.011         0.011         0.019        0.019        0.001
RCU-Small-C.................................        0.005         0.009         0.017        0.017       (0.002)
SCU-A-Small-C...............................        0.038         0.057         0.076        0.076       (0.103)
                                             -------------------------------------------------------------------
    Total...................................        0.389         0.712         0.942        0.822       (0.453)
----------------------------------------------------------------------------------------------------------------
* A value equal to 0.000 means the NPV rounds to less than $0.001 (2013$). Values in parentheses are negative
  numbers.
** IMH-W-Large-B, IMH-A-Large-B, and RCU-Large-B results are the sum of the results for the 2 typical units
  denoted by B1 and B2.

    The NPV results based on the aforementioned 9-year analysis period 
are presented in Table V.42 and Table V.43. The impacts are counted 
over the lifetime of equipment purchased in 2018-2026. As mentioned 
previously, this information is presented for informational purposes 
only and is not indicative of any change in DOE's analytical 
methodology or decision criteria.

Table V.42--Net Present Value at a 7-Percent Discount Rate for 9-Year Analysis Period for Equipment Purchased in
                                                    2018-2026
                                                 [Billion 2013$]
----------------------------------------------------------------------------------------------------------------
                                                                       Standard level *
               Equipment class               -------------------------------------------------------------------
                                                  TSL 1         TSL 2        TSL 3        TSL 4         TSL 5
----------------------------------------------------------------------------------------------------------------
IMH-W-Small-B...............................        0.003         0.003         0.005        0.005       (0.030)
IMH-W-Med-B.................................        0.005         0.005         0.005        0.003       (0.004)
IMH-W-Large-B...............................        0.000         0.000         0.000        0.000       (0.001)
IMH-W-Large-B-1.............................        0.000         0.000         0.000        0.000       (0.001)
IMH-W-Large-B-2.............................        0.000         0.000         0.000        0.000       (0.000)
IMH-A-Small-B...............................        0.009         0.009         0.018        0.018       (0.137)
IMH-A-Large-B...............................        0.021         0.051         0.057        0.036       (0.005)
IMH-A-Large-B-1.............................        0.021         0.052         0.057        0.036       (0.006)
IMH-A-Large-B-2.............................       (0.000)       (0.000)        0.001        0.001        0.001
RCU-Large-B.................................        0.021         0.021         0.021        0.018        0.004
RCU-Large-B-1...............................        0.020         0.020         0.020        0.017        0.005
RCU-Large-B-2...............................        0.001         0.001         0.001        0.001       (0.001)
SCU-W-Large-B...............................        0.001         0.001         0.001        0.000        0.000
SCU-A-Small-B...............................        0.008         0.018         0.036        0.032       (0.030)

[[Page 4739]]

 
SCU-A-Large-B...............................        0.007         0.028         0.030        0.001        0.001
IMH-A-Small-C...............................        0.003         0.004         0.007        0.007       (0.007)
IMH-A-Large-C...............................        0.003         0.003         0.005        0.005       (0.000)
RCU-Small-C.................................        0.001         0.002         0.004        0.004       (0.001)
SCU-A-Small-C...............................        0.009         0.013         0.018        0.018       (0.030)
                                             -------------------------------------------------------------------
    Total...................................        0.090         0.158         0.207        0.147       (0.241)
----------------------------------------------------------------------------------------------------------------
* A value equal to 0.000 means the NPV rounds to less than $0.001 (2013$). Values in parentheses are negative
  numbers.

Table V.43--Net Present Value at a 3-Percent Discount Rate for 9-Year Analysis Period for Equipment Purchased in
                                                    2018-2026
                                                 [Billion 2013$]
----------------------------------------------------------------------------------------------------------------
                                                                        Standard level *
                Equipment class                -----------------------------------------------------------------
                                                   TSL 1        TSL 2        TSL 3        TSL 4         TSL 5
----------------------------------------------------------------------------------------------------------------
IMH-W-Small-B.................................        0.005        0.005        0.009        0.009       (0.038)
IMH-W-Med-B...................................        0.008        0.008        0.008        0.006       (0.002)
IMH-W-Large-B.................................        0.000        0.000        0.000        0.000       (0.001)
IMH-W-Large-B-1...............................        0.000        0.000        0.000        0.000       (0.001)
IMH-W-Large-B-2...............................        0.000        0.000        0.000        0.000       (0.000)
IMH-A-Small-B.................................        0.014        0.017        0.035        0.035       (0.168)
IMH-A-Large-B.................................        0.033        0.081        0.090        0.067        0.016
IMH-A-Large-B-1...............................        0.033        0.081        0.089        0.065        0.014
IMH-A-Large-B-2...............................        0.001        0.001        0.002        0.002        0.002
RCU-Large-B...................................        0.032        0.032        0.032        0.031        0.015
RCU-Large-B-1.................................        0.030        0.030        0.030        0.030        0.016
RCU-Large-B-2.................................        0.002        0.002        0.002        0.002       (0.000)
SCU-W-Large-B.................................        0.001        0.002        0.002        0.001        0.001
SCU-A-Small-B.................................        0.013        0.029        0.057        0.054       (0.029)
SCU-A-Large-B.................................        0.011        0.043        0.047        0.010        0.010
IMH-A-Small-C.................................        0.004        0.007        0.011        0.011       (0.008)
IMH-A-Large-C.................................        0.004        0.004        0.007        0.007        0.001
RCU-Small-C...................................        0.002        0.003        0.006        0.006       (0.001)
SCU-A-Small-C.................................        0.014        0.021        0.028        0.028       (0.037)
                                               -----------------------------------------------------------------
    Total.....................................        0.142        0.253        0.332        0.264       (0.241)
----------------------------------------------------------------------------------------------------------------
* A value equal to 0.000 means the NPV rounds to less than $0.001 (2013$). Values in parentheses are negative
  numbers.

c. Water Savings
    One energy-saving design option for batch type ice makers had the 
additional benefit of reducing potable water usage for some types of 
batch type ice makers. The water savings are identified on Table V.44. 
DOE is not, as part of this rulemaking, establishing a potable water 
standard. The water savings identified through the analyses are 
products of the analysis of energy-saving design options.

                                            Table V.44--Water Savings
----------------------------------------------------------------------------------------------------------------
                                                       Water savings by standard level * ** million gallons
                Equipment class                 ----------------------------------------------------------------
                                                    TSL 1        TSL 2        TSL 3        TSL 4        TSL 5
----------------------------------------------------------------------------------------------------------------
IMH-W-Small-B..................................          761          761        1,733        1,733        1,733
IMH-W-Med-B....................................            0            0            0            0            0
IMH-W-Large-B..................................            0            0            0            0            0
IMH-W-Large-B1.................................            0            0            0            0            0
IMH-W-Large-B2.................................            0            0            0            0            0
IMH-A-Small-B..................................            0            0            0            0       -5,424
IMH-A-Large-B..................................            0       12,501       12,501       11,733       11,733
IMH-A-Large-B1.................................            0       12,501       12,501       11,733       11,733
IMH-A-Large-B2.................................            0            0            0            0            0
RCU-Large-B....................................            0            0            0            0            0
RCU-Large-B1...................................            0            0            0            0            0
RCU-Large-B2...................................            0            0            0            0            0

[[Page 4740]]

 
SCU-W-Large-B..................................          336          336          336          336          336
SCU-A-Small-B..................................            0            0       13,580       13,580       13,580
SCU-A-Large-B..................................            0        9,388        9,388        9,388        9,388
IMH-A-Small-C..................................            0            0            0            0            0
IMH-A-Large-C..................................            0            0            0            0            0
RCU-Small-C....................................            0            0            0            0            0
SCU-A-Small-C..................................            0            0            0            0            0
                                                ----------------------------------------------------------------
    Total......................................        1,097       22,987       37,539       36,771       31,347
----------------------------------------------------------------------------------------------------------------
* A zero indicates no water usage reductions were identified.
** IMH-W-Large-B, IMH-A-Large-B, and RCU-Large-B results are the sum of the results for the 2 typical units
  denoted by B1 and B2.

d. Indirect Employment Impacts
    In addition to the direct impacts on manufacturing employment 
discussed in section IV.N, DOE develops general estimates of the 
indirect employment impacts of the new and amended standards on the 
economy. DOE expects amended energy conservation standards for 
automatic commercial ice makers to reduce energy bills for commercial 
customers and expects the resulting net savings to be redirected to 
other forms of economic activity. DOE also realizes that these shifts 
in spending and economic activity by automatic commercial ice maker 
owners could affect the demand for labor. Thus, indirect employment 
impacts may result from expenditures shifting between goods (the 
substitution effect) and changes in income and overall expenditure 
levels (the income effect) that occur due to the imposition of new and 
amended standards. These impacts may affect a variety of businesses not 
directly involved in the decision to make, operate, or pay the utility 
bills for automatic commercial ice makers. To estimate these indirect 
economic effects, DOE used an input/output model of the U.S. economy 
using U.S. Department of Commerce, Bureau of Economic Analysis (BEA), 
and BLS data (as described in section IV.J of this rulemaking; see 
chapter 16 of the final rule TSD for more details).
    Customers who purchase more-efficient equipment pay lower amounts 
towards utility bills, which results in job losses in the electric 
utilities sector. In this input/output model, the dollars saved on 
utility bills from more-efficient automatic commercial ice makers are 
spent in economic sectors that create more jobs than are lost in 
electric and water utilities sectors. Thus, the new and amended energy 
conservation standards for automatic commercial ice makers are likely 
to slightly increase the net demand for labor in the economy. The net 
increase in jobs might be offset by other, unanticipated effects on 
employment. Neither the BLS data nor the input/output model used by DOE 
includes the quality of jobs. As shown in Table V.45, DOE estimates 
that net indirect employment impacts from new and amended automatic 
commercial ice makers standard are small relative to the national 
economy.

             Table V.45--Net Short-Term Change in Employment
                          [Number of employees]
------------------------------------------------------------------------
      Trial standard level               2018                2022
------------------------------------------------------------------------
1..............................  18 to 21...........  104 to 107.
2..............................  31 to 38...........  196 to 204.
3..............................  41 to 52...........  263 to 276.
4..............................  41 to 63...........  315 to 340.
5..............................  4 to 82............  376 to 464.
------------------------------------------------------------------------

4. Impact on Utility or Performance of Equipment
    In performing the engineering analysis, DOE considers design 
options that would not lessen the utility or performance of the 
individual classes of equipment. (42 U.S.C. 6295(o)(2)(B)(i)(IV) and 
6313(d)(4)) As presented in the screening analysis (chapter 4 of the 
final rule TSD), DOE eliminates from consideration any design options 
that reduce the utility of the equipment. For this rulemaking, DOE did 
not consider TSLs for automatic commercial ice makers that reduce the 
utility or performance of the equipment.
5. Impact of Any Lessening of Competition
    EPCA directs DOE to consider any lessening of competition likely to 
result from amended standards. It directs the Attorney General of the 
United States (Attorney General) to determine in writing the impact, if 
any, of any lessening of competition likely to result from a proposed 
standard. (42 U.S.C. 6295(o)(2)(B)(i)(V) and 6313(d)(4)) To assist the 
Attorney General in making such a determination, DOE provided the DOJ 
with copies of this rule and the TSD for review. During MIA interviews, 
domestic manufacturers indicated that foreign manufacturers have begun 
to enter the automatic commercial ice maker industry, but not in 
significant numbers. Manufacturers also stated that consolidation has 
occurred among automatic commercial ice makers manufacturers in recent 
years. Interviewed manufacturers believe that these trends may continue 
in this market even in the absence of amended standards.
    More than one manufacturer suggested that where they already have 
overseas manufacturing capabilities, they would consider moving 
additional manufacturing to those facilities if they felt the need to 
offset a significant rise in materials costs. The Department 
acknowledges that to be competitive in the marketplace manufacturers 
must constantly re-examine their supply chains and manufacturing 
infrastructure. DOE does not believe however, that at the levels 
specified in this final rule, amended standards would result in 
domestic firms relocating significant portions of their domestic 
production capacity to other countries. The majority of automatic 
commercial ice makers are manufactured in the U.S. and the amended 
standards are at levels which are already met by a large portion of the 
product models being manufactured. The amended standards can largely be 
met using existing capital assets and during interviews, manufacturers 
in general indicated they would modify their existing facilities to 
comply with amended energy conservation standards.

[[Page 4741]]

6. Need of the Nation To Conserve Energy
    An improvement in the energy efficiency of the equipment subject to 
this final rule is likely to improve the security of the Nation's 
energy system by reducing overall demand for energy. Reduced 
electricity demand resulting from energy conservation may also improve 
the reliability of the electricity system. As a measure of this reduced 
demand, chapter 15 in the final rule TSD presents the estimated 
reduction in national generating capacity for the TSLs that DOE 
considered in this rulemaking.
    Energy savings from new and amended standards for automatic 
commercial ice makers could also produce environmental benefits in the 
form of reduced emissions of air pollutants and GHGs associated with 
electricity production. Table V.46 provides DOE's estimate of 
cumulative CO2, NOX, Hg, N2O, 
CH4 and SO2 emissions reductions projected to 
result from the TSLs considered in this rule. The table includes both 
power sector emissions and upstream emissions. The upstream emissions 
were calculated using the multipliers discussed in section IV.K. DOE 
reports annual emissions reductions for each TSL in chapter 13 of the 
final rule TSD.

          Table V.46--Summary of Emissions Reduction Estimated for Automatic Commercial Ice Makers TSLs
                                [Cumulative for equipment purchased in 2018-2047]
----------------------------------------------------------------------------------------------------------------
                                                                               TSL
                                                ----------------------------------------------------------------
                                                      1            2            3            4            5
----------------------------------------------------------------------------------------------------------------
                                         Power Sector and Site Emissions
----------------------------------------------------------------------------------------------------------------
CO2 (million metric tons)......................         4.68         7.87        10.38        13.25        18.62
NOX (thousand tons)............................         3.71         6.23         8.22        10.50        14.75
Hg (tons)......................................         0.01         0.02         0.03         0.04         0.05
N2O (thousand tons)............................         0.06         0.11         0.14         0.18         0.25
CH4 (thousand tons)............................         0.44         0.73         0.97         1.24         1.74
SO2 (thousand tons)............................         4.13         6.95         9.17        11.70        16.45
----------------------------------------------------------------------------------------------------------------
                                               Upstream Emissions
----------------------------------------------------------------------------------------------------------------
CO2 (million metric tons)......................         0.25         0.42         0.56         0.72         1.00
NOX (thousand tons)............................         3.59         6.03         7.96        10.17        14.29
Hg (tons)......................................         0.00         0.00         0.00         0.00         0.00
N2O (thousand tons)............................         0.00         0.00         0.00         0.01         0.01
CH4 (thousand tons)............................        20.91        35.15        46.40        59.23        83.24
SO2 (thousand tons)............................         0.04         0.08         0.10         0.13         0.18
----------------------------------------------------------------------------------------------------------------
                                                 Total Emissions
----------------------------------------------------------------------------------------------------------------
CO2 (million metric tons)......................         4.93         8.29        10.94        13.97        19.63
NOX (thousand tons)............................         7.30        12.26        16.19        20.67        29.04
Hg (tons)......................................         0.01         0.02         0.03         0.04         0.05
N2O (thousand tons)............................         0.06         0.11         0.14         0.18         0.26
CH4 (thousand tons)............................        21.35        35.89        47.37        60.47        84.97
SO2 (thousand tons)............................         4.18         7.02         9.27        11.83        16.62
----------------------------------------------------------------------------------------------------------------

    As part of the analysis for this final rule, DOE estimated monetary 
benefits likely to result from the reduced emissions of CO2 
and NOX that were estimated for each of the TSLs considered. 
As discussed in section IV.L, DOE used values for the SCC developed by 
an interagency process. The interagency group selected four sets of SCC 
values for use in regulatory analyses. Three sets are based on the 
average SCC from three integrated assessment models, at discount rates 
of 2.5 percent, 3 percent, and 5 percent. The fourth set, which 
represents the 95th-percentile SCC estimate across all three models at 
a 3-percent discount rate, is included to represent higher-than-
expected impacts from temperature change further out in the tails of 
the SCC distribution. The four SCC values for CO2 emissions 
reductions in 2015, expressed in 2013$, are $12/ton, $40.5/ton, $62.4/
ton, and $119.0/ton. These values for later years are higher due to 
increasing emissions-related costs as the magnitude of projected 
climate change is expected to increase.
    Table V.47 presents the global value of CO2 emissions 
reductions at each TSL. DOE calculated domestic values as a range from 
7 percent to 23 percent of the global values, and these results are 
presented in chapter 14 of the final rule TSD.

[[Page 4742]]

Table V.47--Global Present Value of CO2 Emissions Reduction for Potential Standards for Automatic Commercial Ice
                                                     Makers
----------------------------------------------------------------------------------------------------------------
                                                                          SCC scenario *
                                                 ---------------------------------------------------------------
                       TSL                                                                          3% Discount
                                                    5% Discount     3% Discount    2.5% Discount    rate, 95th
                                                   rate, average   rate, average   rate, average    percentile
----------------------------------------------------------------------------------------------------------------
                                                                           million 2013$
----------------------------------------------------------------------------------------------------------------
                                         Power Sector and Site Emissions
----------------------------------------------------------------------------------------------------------------
1...............................................            34.5           154.3           243.8           476.2
2...............................................            57.9           259.4           409.9           800.5
3...............................................            76.4           342.3           541.0         1,056.6
4...............................................            97.6           437.0           690.6         1,348.9
5...............................................           137.1           614.1           970.5         1,895.5
----------------------------------------------------------------------------------------------------------------
                                               Upstream Emissions
----------------------------------------------------------------------------------------------------------------
1...............................................             1.8             8.2            13.0            25.4
2...............................................             3.0            13.8            21.9            42.7
3...............................................             4.0            18.2            28.8            56.3
4...............................................             5.1            23.3            36.8            71.9
5...............................................             7.2            32.7            51.8           101.0
----------------------------------------------------------------------------------------------------------------
                                                 Total Emissions
----------------------------------------------------------------------------------------------------------------
1...............................................            36.3           162.5           256.8           501.6
2...............................................            61.0           273.2           431.7           843.1
3...............................................            80.5           360.6           569.8         1,112.9
4...............................................           102.7           460.3           727.5         1,420.8
5...............................................           144.3           646.8         1,022.3         1,996.5
----------------------------------------------------------------------------------------------------------------
* For each of the four cases, the corresponding SCC value for emissions in 2015 is $12, $40.5, $62.4, and $119.0
  per metric ton (2013$).

    DOE is well aware that scientific and economic knowledge about the 
contribution of CO2 and other GHG emissions to changes in 
the future global climate and the potential resulting damages to the 
world economy continues to evolve rapidly. Thus, any value placed in 
this rulemaking on reducing CO2 emissions is subject to 
change. DOE, together with other Federal agencies, will continue to 
review various methodologies for estimating the monetary value of 
reductions in CO2 and other GHG emissions. This ongoing 
review will consider the comments on this subject that are part of the 
public record for this and other rulemakings, as well as other 
methodological assumptions and issues. However, consistent with DOE's 
legal obligations, and taking into account the uncertainty involved 
with this particular issue, DOE has included in this final rule the 
most recent values and analyses resulting from the ongoing interagency 
review process.
    DOE also estimated a range for the cumulative monetary value of the 
economic benefits associated with NOX emission reductions 
anticipated to result from the new and amended standards for the 
automatic commercial ice makers. The dollar-per-ton values that DOE 
used are discussed in section IV.L. Table V.48 presents the present 
value of cumulative NOX emissions reductions for each TSL 
calculated using the average dollar-per-ton values and 7-percent and 3-
percent discount rates.

   Table V.48--Present Value of NOX Emissions Reduction for Potential
              Standards for Automatic Commercial Ice Makers
------------------------------------------------------------------------
                                                        3%         7%
                        TSL                          Discount   Discount
                                                       rate       rate
------------------------------------------------------------------------
                                                        million 2013$
------------------------------------------------------------------------
                    Power Sector and Site Emissions *
------------------------------------------------------------------------
1.................................................        5.6        2.9
2.................................................        9.4        4.9
3.................................................       12.4        6.5
4.................................................       15.8        8.2
5.................................................       22.2       11.6
------------------------------------------------------------------------
                           Upstream Emissions
------------------------------------------------------------------------
1.................................................        5.2        2.5
2.................................................        8.7        4.3
3.................................................       11.4        5.6
4.................................................       14.6        7.2
5.................................................       20.5       10.1
------------------------------------------------------------------------
                             Total Emissions
------------------------------------------------------------------------
1.................................................       10.7        5.4
2.................................................       18.0        9.2
3.................................................       23.8       12.1
4.................................................       30.4       15.4
5.................................................       42.7       21.7
------------------------------------------------------------------------

    The NPV of the monetized benefits associated with emission 
reductions can be viewed as a complement to the NPV of the customer 
savings calculated for each TSL considered in this rulemaking. Table 
V.49 presents the NPV values that result from adding the estimates of 
the potential economic benefits resulting from reduced CO2 
and NOX emissions in each of four valuation scenarios to the 
NPV of consumer savings calculated for each TSL considered in this 
rulemaking, at both a 7-percent and a 3-percent discount rate. The 
CO2 values used in the table correspond to the four 
scenarios for the valuation of CO2 emission reductions 
presented in section IV.L.

[[Page 4743]]

    Table V.49--Automatic Commercial Ice Makers TSLs: Net Present Value of Customer Savings Combined With Net
                    Present Value of Monetized Benefits From CO2 and NOX Emissions Reductions
----------------------------------------------------------------------------------------------------------------
                                                           Consumer NPV at 3% Discount Rate added with:
                                                 ---------------------------------------------------------------
                                                   SCC Value of    SCC Value of    SCC Value of    SCC Value of
                       TSL                        $12/metric ton   $40.5/metric    $62.4/metric    $119.0/metric
                                                     CO2 * and     ton CO2 * and   ton CO2 * and   ton CO2 * and
                                                   medium value    medium value    medium value    medium value
                                                     for NOX *       for NOX *       for NOX *       for NOX *
----------------------------------------------------------------------------------------------------------------
                                                                           billion 2013$
                                                 ---------------------------------------------------------------
1...............................................           0.436           0.563           0.657           0.902
2...............................................           0.791           1.004           1.162           1.574
3...............................................           1.046           1.326           1.536           2.079
4...............................................           0.955           1.313           1.580           2.273
5...............................................         (0.266)           0.237           0.612           1.587
----------------------------------------------------------------------------------------------------------------
                                                           Consumer NPV at 7% Discount Rate added with:
                                                 ---------------------------------------------------------------
                       TSL                         SCC Value of    SCC Value of    SCC Value of    SCC Value of
                                                  $12/metric ton   $40.5/metric    $62.4/metric    $119.0/metric
                                                     CO2 * and     ton CO2 * and   ton CO2 * and   ton CO2 * and
                                                   medium value    medium value    medium value    medium value
                                                     for NOX *       for NOX *       for NOX *       for NOX *
----------------------------------------------------------------------------------------------------------------
                                                                           billion 2013$
                                                 ---------------------------------------------------------------
1...............................................           0.225           0.351           0.445           0.690
2...............................................           0.398           0.611           0.769           1.181
3...............................................           0.523           0.803           1.012           1.555
4...............................................           0.455           0.813           1.080           1.773
5...............................................         (0.240)           0.263           0.638           1.613
----------------------------------------------------------------------------------------------------------------
* These label values represent the global SCC in 2015, in 2013$. The present values have been calculated with
  scenario-consistent discount rates. For NOX emissions, each case uses the medium value, which corresponds to
  $2,684 per ton.

    Although adding the value of customer savings to the values of 
emission reductions provides a valuable perspective, the following 
should be considered. First, the national customer savings are domestic 
U.S. customer monetary savings that occur as a result of market 
transactions, while the values of emission reductions are based on 
estimates of marginal social costs, which, in the case of 
CO2, are based on a global value. Second, the assessments of 
customer operating cost savings and emission-related benefits are 
performed with quite different time frames for analysis. For automatic 
commercial ice makers, the present value of national customer savings 
is measured for the lifetime of units shipped from 2018 through 2047. 
The SCC values, on the other hand, reflect the present value of future 
climate-related impacts resulting from the emission of one metric ton 
of CO2 in each year. Because of the long residence time of 
CO2 in the atmosphere, these impacts continue well beyond 
2100.
7. Other Factors
    EPCA allows the Secretary, in determining whether a standard is 
economically justified, to consider any other factors that the 
Secretary deems to be relevant. (42 U.S.C. 6295(o)(2)(B)(i)(VII) and 
6313(d)(4)) DOE considered LCC impacts on identifiable groups of 
customers, such as customers of different business types, who may be 
disproportionately affected by any new or amended national energy 
conservation standard level. The LCC subgroup impacts are discussed in 
section V.B.1.b and in final rule TSD chapter 11. DOE also considered 
the reduction in generation capacity that could result from the 
imposition of any new or amended national energy conservation standard 
level. Electric utility impacts are presented in final rule TSD chapter 
15.

C. Conclusions/Proposed Standard

    Any new or amended energy conservation standard for any type (or 
class) of covered product must be designed to achieve the maximum 
improvement in energy efficiency that the Secretary determines is 
technologically feasible and economically justified. (42 U.S.C. 
6295(o)(2)(A) and 6313(d)(4)) In determining whether a proposed 
standard is economically justified, the Secretary must determine 
whether the benefits of the standard exceed its burdens to the greatest 
extent practicable, considering the seven statutory factors discussed 
previously. (42 U.S.C. 6295(o)(2)(B)(i) and 6313(d)(4)) The new or 
amended standard must also result in a significant conservation of 
energy. (42 U.S.C. 6295(o)(3)(B) and 6313(d)(4))
    DOE considered the impacts of potential standards at each TSL, 
beginning with the maximum technologically feasible level, to determine 
whether that level met the evaluation criteria. If the max-tech level 
was not justified, DOE then considered the next most-efficient level 
and undertook the same evaluation until it reached the highest 
efficiency level that is both technologically feasible and economically 
justified and saves a significant amount of energy.
    To aid the reader in understanding the benefits and/or burdens of 
each TSL, tables are presented to summarize the quantitative analytical 
results for each TSL, based on the assumptions and methodology 
discussed herein. The efficiency levels contained in each TSL are 
described in section V.A. In addition to the quantitative results 
presented in the tables below, DOE also considers other burdens and 
benefits that affect economic justification including the effect of 
technological feasibility, manufacturer costs, and impacts on 
competition on the economic results presented. Table V.50, Table V.51, 
Table V.52 and Table V.53 present a summary of the results of DOE's 
quantitative analysis for each TSL. Results in Table

[[Page 4744]]

V.50 through Table V.53 are impacts from equipment purchased in the 
period from 2018 through 2047. In addition to the quantitative results 
presented in the tables, DOE also considers other burdens and benefits 
that affect economic justification of certain customer subgroups that 
are disproportionately affected by the proposed standards. Section 
V.B.1.b presents the estimated impacts of each TSL for these subgroups.

                               Table V.50--Summary of Results for Automatic Commercial Ice Makers TSLs: National Impacts *
--------------------------------------------------------------------------------------------------------------------------------------------------------
              Category                        TSL 1                   TSL 2                  TSL 3                  TSL 4                  TSL 5
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                  Cumulative National Energy Savings 2018 through 2047
                                                                          Quads
--------------------------------------------------------------------------------------------------------------------------------------------------------
Undiscounted values................  0.081.................  0.136.................  0.179................  0.229................  0.321.
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                   Cumulative National Water Savings 2018 through 2047
                                                                     billion gallons
--------------------------------------------------------------------------------------------------------------------------------------------------------
Undiscounted values................  1.0...................  23.0..................  37.5.................  36.8.................  31.3.
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                  Cumulative NPV of Customer Benefits 2018 through 2047
                                                                      billion 2013$
--------------------------------------------------------------------------------------------------------------------------------------------------------
3% discount rate...................  0.389.................  0.712.................  0.942................  0.822................  (0.453).
7% discount rate...................  0.183.................  0.328.................  0.430................  0.337................  (0.406).
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                    Industry Impacts
--------------------------------------------------------------------------------------------------------------------------------------------------------
Change in Industry NPV (2013$        (7.5) to (6.6)........  (11.2) to (9.3).......  (15.1) to (12.1).....  (18.6) to (12.3).....  (30.0) to (11.8).
 million).
Change in Industry NPV (%).........  (6.2) to (5.4)........  (9.2) to (7.7)........  (12.5) to (10.0).....  (15.3) to (10.1).....  (24.6) to (9.7).
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                  Cumulative Emissions Reductions 2018 through 2047 **
--------------------------------------------------------------------------------------------------------------------------------------------------------
CO2 (MMt)..........................  4.93..................  8.29..................  10.94................  13.97................  19.63.
NOX (kt)...........................  7.30..................  12.26.................  16.19................  20.67................  29.04.
Hg (t).............................  0.01..................  0.02..................  0.03.................  0.04.................  0.05.
N2O (kt)...........................  0.06..................  0.11..................  0.14.................  0.18.................  0.26.
N2O (kt CO2eq).....................  17.14.................  28.81.................  38.03................  48.55................  68.23.
CH4 (kt)...........................  21.35.................  35.89.................  47.37................  60.47................  84.97.
CH4 (kt CO2eq).....................  597.78................  1004.79...............  1326.27..............  1693.16..............  2379.30.
SO2 (kt)...........................  4.18..................  7.02..................  9.27.................  11.83................  16.62.
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                      Monetary Value of Cumulative Emissions Reductions 2018 through 2047 [dagger]
--------------------------------------------------------------------------------------------------------------------------------------------------------
CO2 (2013$ billion)................  0.036 to 0.502........  0.061 to 0.843........  0.080 to 1.113.......  0.103 to 1.421.......  0.144 to 1.997.
NOX--3% discount rate (2013$         10.7..................  18.0..................  23.8.................  30.4.................  42.7.
 million).
NOX--7% discount rate (2013$         5.4...................  9.2...................  12.1.................  15.4.................  21.7.
 million).
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                   Employment Impacts
--------------------------------------------------------------------------------------------------------------------------------------------------------
Net Change in Indirect Domestic      104 to 107............  196 to 204............  263 to 276...........  315 to 340...........  376 to 464.
 Jobs by 2022.
--------------------------------------------------------------------------------------------------------------------------------------------------------
* Values in parentheses are negative numbers.
** ``MMt'' stands for million metric tons; ``kt'' stands for kilotons; ``t'' stands for tons. CO2eq is the quantity of CO2 that would have the same
  global warming potential (GWP).
[dagger] Range of the economic value of CO2 reductions is based on estimates of the global benefit of reduced CO2 emissions. Economic value of NOX
  reductions is based on estimates at $2,684/ton.

            Table V.51--Summary of Results for Automatic Commercial Ice Makers TSLs: Mean LCC Savings
                                                     [2013$]
----------------------------------------------------------------------------------------------------------------
                                                                         Standard level
                Equipment class                -----------------------------------------------------------------
                                                   TSL 1        TSL 2        TSL 3        TSL 4         TSL 5
----------------------------------------------------------------------------------------------------------------
IMH-W-Small-B.................................         $175         $175         $214         $214        ($534)
IMH-W-Med-B...................................         $308         $308         $308         $165         ($63)
IMH-W-Large-B *...............................           NA           NA           NA           NA        ($172)
IMH-W-Large-B1................................           NA           NA           NA           NA        ($200)
IMH-W-Large-B2................................           NA           NA           NA           NA         ($80)
IMH-A-Small-B.................................         $136          $72          $77          $77        ($393)
IMH-A-Large-B *...............................         $382         $501         $361         $265          $55
IMH-A-Large-B1................................         $439         $580         $407         $294          $45
IMH-A-Large-B2................................          $76          $76         $110         $110         $110

[[Page 4745]]

 
RCU-Large-B *.................................         $748         $748         $748         $418         $144
RCU-Large-B1..................................         $743         $743         $743         $391         $161
RCU-Large-B2..................................         $820         $820         $820         $820        ($109)
SCU-W-Large-B.................................         $444         $613         $550         $192         $192
SCU-A-Small-B.................................         $110         $161         $281         $230        ($145)
SCU-A-Large-B.................................         $163         $400         $439          $71          $71
IMH-A-Small-C.................................         $245         $292         $313         $313        ($165)
IMH-A-Large-C.................................         $539         $539         $626         $626          $28
RCU-Small-C...................................         $498         $448         $505         $505         ($73)
SCU-A-Small-C.................................         $224         $278         $290         $290        ($268)
----------------------------------------------------------------------------------------------------------------
* LCC results for IMH-W-Large-B, IMH-A-Large-B, and RCU-Large-B are a weighted average of the two sub-equipment
  class level typical units shown on the table, using weights provided in TSD chapter 7.

         Table V.52--Summary of Results for Automatic Commercial Ice Makers TSLs: Median Payback Period
----------------------------------------------------------------------------------------------------------------
                                                                       Standard level years
                Equipment class                 ----------------------------------------------------------------
                                                    TSL 1        TSL 2        TSL 3        TSL 4        TSL 5
----------------------------------------------------------------------------------------------------------------
IMH-W-Small-B..................................          2.5          2.5          2.7          2.7         13.4
IMH-W-Med-B....................................          2.1          2.1          2.1          5.0          7.6
IMH-W-Large-B*.................................           NA           NA           NA           NA         10.6
IMH-W-Large-B1.................................           NA           NA           NA           NA         11.1
IMH-W-Large-B2.................................           NA           NA           NA           NA          8.9
IMH-A-Small-B..................................          3.4          4.8          4.7          4.7         11.9
IMH-A-Large-B*.................................          2.2          2.4          2.3          3.9          5.6
IMH-A-Large-B1.................................          1.2          1.5          1.5          3.4          5.4
IMH-A-Large-B2.................................          7.4          7.4          6.9          6.9          6.9
RCU-Large-B*...................................          1.1          1.1          1.1          3.3          5.0
RCU-Large-B1...................................          0.9          0.9          0.9          3.4          4.9
RCU-Large-B2...................................          3.0          3.0          3.0          3.0          7.0
SCU-W-Large-B..................................          1.1          1.6          1.8          5.1          5.1
SCU-A-Small-B..................................          2.2          2.4          2.6          3.5          8.9
SCU-A-Large-B..................................          1.8          1.6          2.1          6.5          6.5
IMH-A-Small-C..................................          1.5          1.6          1.7          1.7          8.8
IMH-A-Large-C..................................          0.7          0.7          0.7          0.7          5.9
RCU-Small-C....................................          0.7          1.2          1.2          1.2          5.8
SCU-A-Small-C..................................          0.8          1.1          1.5          1.5         11.4
----------------------------------------------------------------------------------------------------------------
* PBP results for IMH-W-Large-B, IMH-A-Large-B, and RCU-Large-B are weighted averages of the results for the two
  sub-equipment class level typical units, using weights provided in TSD chapter 7.

  Table V.53--Summary of Results for Automatic Commercial Ice Maker TSLs: Distribution of Customer LCC Impacts
----------------------------------------------------------------------------------------------------------------
                                                            Standard Level percentage of customers (%)
                    Category                    ----------------------------------------------------------------
                                                    TSL 1        TSL 2        TSL 3        TSL 4        TSL 5
----------------------------------------------------------------------------------------------------------------
IMH-W-Small-B
    Net Cost (%)...............................            0            0            1            1           96
    No Impact (%)..............................           63           63           47           47            0
    Net Benefit (%)............................           37           37           52           52            4
IMH-W-Med-B
    Net Cost (%)...............................            0            0            0           28           65
    No Impact (%)..............................           44           44           44           24            9
    Net Benefit (%)............................           56           56           56           47           26
IMH-W-Large-B *
    Net Cost (%)...............................           NA           NA           NA           NA           67
    No Impact (%)..............................           NA           NA           NA           NA           13
    Net Benefit (%)............................           NA           NA           NA           NA           20
IMH-W-Large-B1
    Net Cost (%)...............................           NA           NA           NA           NA           70
    No Impact (%)..............................           NA           NA           NA           NA           13
    Net Benefit (%)............................           NA           NA           NA           NA           17

[[Page 4746]]

 
IMH-W-Large-B2
    Net Cost (%)...............................           NA           NA           NA           NA           59
    No Impact (%)..............................           NA           NA           NA           NA           13
    Net Benefit (%)............................           NA           NA           NA           NA           29
IMH-A-Small-B
    Net Cost (%)...............................            1           21           21           21           95
    No Impact (%)..............................           76           47            0            0            0
    Net Benefit (%)............................           22           32           79           79            5
IMH-A-Large-B *
    Net Cost (%)...............................            1            1            2           31           53
    No Impact (%)..............................           69           45           12           12           10
    Net Benefit (%)............................           30           53           86           57           37
IMH-A-Large-B1
    Net Cost (%)...............................            0            0            0           35           61
    No Impact (%)..............................           66           38            3            3            0
    Net Benefit (%)............................           34           62           97           63           39
IMH-A-Large-B2
    Net Cost (%)...............................            9            9           10           10           10
    No Impact (%)..............................           83           83           61           61           61
    Net Benefit (%)............................            8            8           29           29           29
RCU-Large-B *
    Net Cost (%)...............................            0            0            0           23           55
    No Impact (%)..............................           56           56           56           22            2
    Net Benefit (%)............................           44           44           44           55           42
RCU-Large-B1
    Net Cost (%)...............................            0            0            0           25           55
    No Impact (%)..............................           56           56           56           20            1
    Net Benefit (%)............................           44           44           44           55           44
RCU-Large-B2
    Net Cost (%)...............................            1            1            1            1           57
    No Impact (%)..............................           56           56           56           56           20
    Net Benefit (%)............................           43           43           43           43           23
SCU-W-Large-B
    Net Cost (%)...............................            0            0            0           44           44
    No Impact (%)..............................           28           28            5            0            0
    Net Benefit (%)............................           72           72           94           56           56
SCU-A-Small-B
    Net Cost (%)...............................            0            1            1           16           77
    No Impact (%)..............................           48           20           12            0            0
    Net Benefit (%)............................           52           79           87           84           23
SCU-A-Large-B
    Net Cost (%)...............................            0            0            0           54           54
    No Impact (%)..............................           37            1            1            0            0
    Net Benefit (%)............................           63           99           99           46           46
IMH-A-Small-C
    Net Cost (%)...............................            0            0            0            0           68
    No Impact (%)..............................           69           58           39           39           14
    Net Benefit (%)............................           31           42           61           61           18
IMH-A-Large-C
    Net Cost (%)...............................            0            0            0            0           54
    No Impact (%)..............................           57           57           35           35            9
    Net Benefit (%)............................           43           43           65           65           37
RCU-Small-C
    Net Cost (%)...............................            0            0            0            0           64
    No Impact (%)..............................           72           44           11           11            6
    Net Benefit (%)............................           28           55           89           89           31
SCU-A-Small-C
    Net Cost (%)...............................            0            0            1            1           86
    No Impact (%)..............................           56           47           32           32            0
    Net Benefit (%)............................           44           53           67           67           14
Average of Equipment Types **
    Net Cost (%)...............................            1            7            6           20           75
    No Impact (%)..............................           62           40           16           12            3
    Net Benefit (%)............................           37           53           77           68           22
----------------------------------------------------------------------------------------------------------------
* LCC results for IMH-W-Large-B, IMH-A-Large-B, and RCU-Large-B are a weighted average of the two sub-equipment
  class level typical units shown on the table.
** Average of equipment types created by weighting the class results by 2018 shipment estimates.

[[Page 4747]]

    DOE also notes that the economics literature provides a wide-
ranging discussion of how consumers trade-off upfront costs and energy 
savings in the absence of government intervention. Much of this 
literature attempts to explain why consumers appear to undervalue 
energy efficiency improvements. There is evidence that consumers 
undervalue future energy savings as a result of (1) a lack of 
information; (2) a lack of sufficient salience of the long-term or 
aggregate benefits; (3) a lack of sufficient savings to warrant 
delaying or altering purchases (e.g., an inefficient ventilation fan in 
a new building or the delayed replacement of a water pump); (4) 
excessive focus on the short term, in the form of inconsistent 
weighting of future energy cost savings relative to available returns 
on other investments; (5) computational or other difficulties 
associated with the evaluation of relevant tradeoffs; and (6) a 
divergence in incentives (e.g., renter versus building owner, builder 
versus home buyer). Other literature indicates that with less than 
perfect foresight and a high degree of uncertainty about the future, 
consumers may trade off these types of investments at a higher-than-
expected rate between current consumption and uncertain future energy 
cost savings. This undervaluation suggests that regulation that 
promotes energy efficiency can produce significant net private gains 
(as well as producing social gains by, for example, reducing 
pollution).
    While DOE is not prepared at present to provide a fuller 
quantifiable framework for estimating the benefits and costs of changes 
in consumer purchase decisions due to an amended energy conservation 
standard, DOE is committed to developing a framework that can support 
empirical quantitative tools for improved assessment of the consumer 
welfare impacts of appliance standards. DOE has posted a paper that 
discusses the issue of consumer welfare impacts of appliance energy 
efficiency standards, and potential enhancements to the methodology by 
which these impacts are defined and estimated in the regulatory 
process.\74\ DOE welcomes comments on how to more fully assess the 
potential impact of energy conservation standards on consumer choice 
and methods to quantify this impact in its regulatory analysis.
---------------------------------------------------------------------------

    \74\ Sanstad, A. Notes on the Economics of Household Energy 
Consumption and Technology Choice. 2010. Lawrence Berkeley National 
Laboratory, Berkeley, CA. www1.eere.energy.gov/buildings/appliance_standards/pdfs/consumer_ee_theory.pdf
---------------------------------------------------------------------------

    TSL 5 corresponds to the max-tech level for all the equipment 
classes and offers the potential for the highest cumulative energy 
savings through the analysis period from 2018 to 2047. The estimated 
energy savings from TSL 5 is 0.321 quads of energy. Because one energy-
saving design option reduces potable water usage, potential savings are 
estimated to be 31 billion gallons, although such savings should not be 
construed to be the result of a potable water standard. DOE projects a 
negative NPV for customers valued at $0.406 billion at a 7-percent 
discount rate. Estimated emissions reductions are 19.6 MMt of 
CO2, up to 29.0 kt of NOX and 0.05 tons of Hg. 
The CO2 emissions have a value of up to $2.0 billion and the 
NOX emissions have a value of $21.7 million at a 7-percent 
discount rate.
    For TSL 5, the mean LCC savings for five equipment classes are 
positive, implying a decrease in LCC, with the decrease ranging from 
$28 for the IMH-A-Large-C equipment class to $192 for the SCU-W-Large-B 
equipment class.\75\ The results shown on Table V.53 indicates a large 
fraction of customers would experience net LCC increases (i.e., LCC 
costs rather than savings) from adoption of TSL 5, with 44 to 96 
percent of customers experiencing net LCC increases. As shown on Table 
V.52, customers would experience payback periods of 5 years or longer 
in all equipment classes, and in many cases customers would experience 
payback periods exceeding the estimated 8.5 year equipment lifetime.
---------------------------------------------------------------------------

    \75\ For this section of the final rule, the discussion is 
limited to results for full equipment classes. Thus, for the large 
equipment classes for which DOE analyzed 2 typical unit sizes, this 
discussion focuses on the weighted average or totals of the two 
typical units.
---------------------------------------------------------------------------

    At TSL 5, the projected change in INPV ranges from a decrease of 
$30.0 million to a decrease of $11.8 million, depending on the chosen 
manufacturer markup scenario. The upper bound is considered optimistic 
by industry because it assumes manufacturers could pass on all 
compliance costs as price increases to their customers. DOE recognizes 
the risk of negative impacts if manufacturers' expectations concerning 
reduced profit margins are realized. If the lower bound of the range of 
impacts is reached, TSL 5 could result in a net loss of up to 24.6 
percent in INPV for the ACIM industry.
    DOE estimates that approximately 84 percent of all batch commercial 
ice makers and 78 percent of all continuous commercial ice makers on 
the market will require redesign to meet standards at TSL 5. DOE 
expects industry conversion costs of $44.1 million. Also of concern, 
for five equipment classes, there is only 1 manufacturer with products 
that could currently meet this standard.
    After carefully considering the analysis results and weighing the 
benefits and burdens of TSL 5, DOE finds that at TSL 5, the benefits to 
the nation in the form of energy savings and emissions reductions are 
outweighed by a decrease of $0.406 billion in customer NPV and a 
decrease of up to 24.6 percent in INPV. Additionally, the majority of 
individual customers purchasing automatic commercial ice makers built 
to TSL 5 standards experience negative life-cycle cost savings, with 
over 90 percent of customers of 2 equipment classes experiencing 
negative life-cycle cost savings. After weighing the burdens of TSL 5 
against the benefits, DOE finds TSL 5 not to be economically justified. 
DOE does not propose to adopt TSL 5 in this rulemaking.
    TSL 4, the next highest efficiency level, corresponds to the 
highest efficiency level with a positive NPV at a 7-percent discount 
rate for all equipment classes. The estimated energy savings from 2018 
to 2047 are 0.229 quads of energy--an amount DOE deems significant. 
Because one energy-saving design option reduces potable water usage, 
potential water savings are estimated to be 37 billion gallons, 
although such savings should not be construed to be the result of a 
potable water standard. At TSL 4, DOE projects an increase in customer 
NPV of $0.337 billion (2013$) at a 7-percent discount rate; estimated 
emissions reductions of 14.0 MMt of CO2, 20.7 kt of 
NOx, and 0.04 tons of Hg. The monetary value for 
CO2 was estimated to be up to $1.4 billion. The monetary 
value for NOX was estimated to be $15.4 million at a 7-
percent discount rate.
    At TSL 4, the mean LCC savings are positive for all equipment 
classes. As shown on Table V.51, mean LCC savings vary from $71 for 
SCU-A-Large-B to $626 for IMH-A-Large-C, which implies that, on 
average, customers will experience an LCC benefit. As shown on Table 
V.53, for 7 of the 13 classes, some fraction of the customers will 
experience net costs, while for 5 classes, 1 percent or less will 
experience net costs. Customers in 3 classes would experience net LCC 
costs of 30 percent or more, with the percentage ranging up to 54 
percent for one equipment class. Median payback periods range from 0.7 
years up to 6.5 years.
    At TSL 4, the projected change in INPV ranges from a decrease of 
$18.6 million to a decrease of $12.3 million. If the lower bound of the 
range of

[[Page 4748]]

impacts is reached, TSL 4 could result in a net loss of up to 15.3 
percent in INPV for manufacturers.
    DOE estimates that approximately 66 percent of all batch commercial 
ice makers and 55 percent of all continuous commercial ice makers on 
the market will require redesign to meet standards at TSL 4. At this 
TSL DOE expects industry conversion costs to total $30.0 million. 
Additionally, for four equipment classes, there is only 1 manufacturer 
with products that currently meet the standard.
    After carefully considering the analysis results and weighing the 
benefits and burdens of TSL 4, DOE finds that at TSL 4, the benefits to 
the nation in the form of energy savings and emissions reductions plus 
an increase of $0.337 billion in customer NPV are outweighed by a 
decrease of up to 15.3 percent in INPV and issues regarding 
availability of product from multiple manufacturers in some product 
classes. After weighing the burdens of TSL 4 against the benefits, DOE 
finds TSL 4 not to be economically justified. DOE does not propose to 
adopt TSL 4 in this rule.
    At TSL 3, the next highest efficiency level, estimated energy 
savings from 2018 through 2047 are 0.179 quads of primary energy--an 
amount DOE considers significant. Because one energy-saving design 
option reduces potable water usage, potential water savings are 
estimated to be 37 billion gallons, although such savings should not be 
construed to be the result of a potable water standard. TSL 3 was 
defined as the set of efficiencies with the highest NPV for each 
analyzed equipment class. At TSL 3, DOE projects an increase in 
customer NPV of $0.430 billion at a 7-percent discount rate, and an 
increase of $0.942 billion at a 3-percent discount rate. Estimated 
emissions reductions are 10.9 MMt of CO2, up to 16.2 kt of 
NOX and 0.03 tons of Hg at TSL 3. The monetary value of the 
CO2 emissions reductions was estimated to be up to $1.1 
billion at TSL 3. The monetary value of the NOX emission 
reductions was estimated to be $12.1 million at a 7-percent discount 
rate.
    At TSL 3, nearly all customers for all equipment classes are shown 
to experience positive LCC savings. As shown on Table V.53 Table V.53, 
the percent of customers experiencing a net cost is 2 percent or less 
in 12 of 13 classes, with IMH-A-Small-B being the exception with 21 
percent of customers experiencing a net cost. The payback period for 
IMH-A-Small-B is 4.7 years, while for all other equipment classes the 
median payback periods are 3 years or less. LCC savings range from $77 
for IMH-A-Small-B to $748 for RCU-Large-B.
    At TSL 3, the projected change in INPV ranges from a decrease of 
$15.1 million to a decrease of $12.1 million. If the lower bound of the 
range of impacts is reached, TSL 3 could result in a net loss of up to 
12.5 percent in INPV for manufacturers.
    DOE estimates that approximately 51 percent of all batch commercial 
ice makers and 55 percent of all continuous commercial ice makers on 
the market will require redesign to meet standards at TSL 3. At TSL 3, 
DOE expects industry conversion costs to total $25.1 million. There are 
multiple manufacturers with product that could meet this standard at 
all analyzed equipment classes.
    At TSL 3, the monetized CO2 emissions reduction values 
range from $0.080 to $1.113 billion. The mid-range value used by DOE to 
calculate total net benefits is the monetized CO2 emissions 
reduction at $40.5 per ton in 2013$, which for TSL 3, is $0.361 
billion. The monetized NOX emissions reductions calculated 
at an intermediate value of $2,684 per ton in 2013$ are $12.1 million 
at a 7-percent discount rate and $23.8 million at a 3-percent rate. 
These monetized emissions reduction values were added to the customer 
NPV at 3-percent and 7-percent discount rates to obtain values of 
$1.326 billion and 0.803 billion, respectively, at TSL 3.
    Approximately 94 percent of customers are expected to experience 
net benefits (or no impact) from equipment built to TSL 3 levels. The 
payback periods for TSL 3 are expected to be 3 years or less for all 
but the IMH-A-Small-B.
    After carefully considering the analysis results and weighing the 
benefits and burdens of TSL 3, DOE concludes that setting the standards 
for automatic commercial ice makers at TSL 3 will offer the maximum 
improvement in energy efficiency that is technologically feasible and 
economically justified and will result in significant energy savings. 
Therefore, DOE today is adopting standards at TSL 3 for automatic 
commercial ice makers. TSL 3 is technologically feasible because the 
technologies required to achieve these levels already exist in the 
current market and are available from multiple manufacturers. TSL 3 is 
economically justified because the benefits to the nation in the form 
of energy savings, customer NPV at 3 percent and at 7 percent, and 
emissions reductions outweigh the costs associated with reduced INPV 
and potential effects of reduced manufacturing capacity.

VI. Procedural Issues and Regulatory Review

A. Review Under Executive Orders 12866 and 13563

    Section 1(b)(1) of Executive Order 12866, ``Regulatory Planning and 
Review,'' 58 FR 51735 (Oct. 4, 1993), requires each agency to identify 
the problem that it intends to address, including, where applicable, 
the failures of private markets or public institutions that warrant new 
agency action, as well as to assess the significance of that problem. 
The problems that these standards address are as follows:
    (1) Insufficient information and the high costs of gathering and 
analyzing relevant information leads some customers to miss 
opportunities to make cost-effective investments in energy efficiency.
    (2) In some cases the benefits of more efficient equipment are not 
realized due to misaligned incentives between purchasers and users. An 
example of such a case is when the equipment purchase decision is made 
by a building contractor or building owner who does not pay the energy 
costs.
    (3) There are external benefits resulting from improved energy 
efficiency of automatic commercial ice makers that are not captured by 
the users of such equipment. These benefits include externalities 
related to public health, environmental protection and national 
security that are not reflected in energy prices, such as reduced 
emissions of air pollutants and greenhouse gases that impact human 
health and global warming.
    In addition, DOE has determined that today's regulatory action is a 
``significant regulatory action'' under Executive Order 12866. DOE 
presented to the Office of Information and Regulatory Affairs (OIRA) in 
the OMB for review the draft rule and other documents prepared for this 
rulemaking, including a regulatory impact analysis (RIA), and has 
included these documents in the rulemaking record. The assessments 
prepared pursuant to Executive Order 12866 can be found in the 
technical support document for this rulemaking.
    DOE has also reviewed this regulation pursuant to Executive Order 
13563, issued on January 18, 2011. (76 FR 3281, Jan. 21, 2011) EO 13563 
is supplemental to and explicitly reaffirms the principles, structures, 
and definitions governing regulatory review established in Executive 
Order 12866. To the extent permitted by law, agencies are required

[[Page 4749]]

by Executive Order 13563 to: (1) Propose or adopt a regulation only 
upon a reasoned determination that its benefits justify its costs 
(recognizing that some benefits and costs are difficult to quantify); 
(2) tailor regulations to impose the least burden on society, 
consistent with obtaining regulatory objectives, taking into account, 
among other things, and to the extent practicable, the costs of 
cumulative regulations; (3) select, in choosing among alternative 
regulatory approaches, those approaches that maximize net benefits 
(including potential economic, environmental, public health and safety, 
and other advantages; distributive impacts; and equity); (4) to the 
extent feasible, specify performance objectives, rather than specifying 
the behavior or manner of compliance that regulated entities must 
adopt; and (5) identify and assess available alternatives to direct 
regulation, including providing economic incentives to encourage the 
desired behavior, such as user fees or marketable permits, or providing 
information upon which choices can be made by the public.
    DOE emphasizes as well that Executive Order 13563 requires agencies 
to use the best available techniques to quantify anticipated present 
and future benefits and costs as accurately as possible. In its 
guidance, the Office of Information and Regulatory Affairs has 
emphasized that such techniques may include identifying changing future 
compliance costs that might result from technological innovation or 
anticipated behavioral changes. For the reasons stated in the preamble, 
DOE believes that this final rule is consistent with these principles, 
including the requirement that, to the extent permitted by law, 
benefits justify costs and that net benefits are maximized.

B. Review Under the Regulatory Flexibility Act

    The Regulatory Flexibility Act (5 U.S.C. 601 et seq.) requires 
preparation of an final regulatory flexibility analysis (FRFA) for any 
rule that by law must be proposed for public comment, unless the agency 
certifies that the rule, if promulgated, will not have a significant 
economic impact on a substantial number of small entities. As required 
by Executive Order 13272, ``Proper Consideration of Small Entities in 
Agency Rulemaking,'' 67 FR 53461 (August 16, 2002), DOE published 
procedures and policies on February 19, 2003, to ensure that the 
potential impacts of its rules on small entities are properly 
considered during the rulemaking process. 68 FR 7990. DOE has made its 
procedures and policies available on the Office of the General 
Counsel's Web site (http://energy.gov/gc/office-general-counsel).
    For manufacturers of automatic commercial ice makers, the Small 
Business Administration (SBA) has set a size threshold, which defines 
those entities classified as ``small businesses'' for the purposes of 
the statute. DOE used the SBA's small business size standards to 
determine whether any small entities would be subject to the 
requirements of the rule. 65 FR 30836, 30848 (May 15, 2000), as amended 
by 65 FR 53533, 53544 (September 5, 2000) and codified at 13 CFR part 
121. The size standards are listed by North American Industry 
Classification System (NAICS) code and industry description and are 
available at http://www.sba.gov/sites/default/files/files/Size_Standards_Table.pdf. Commercial refrigeration equipment 
manufacturing is classified under NAICS 333415, ``Air-Conditioning and 
Warm Air Heating Equipment and Commercial and Industrial Refrigeration 
Equipment Manufacturing,'' which includes ice-making machinery 
manufacturing. The SBA sets a threshold of 750 employees or less for an 
entity to be considered as a small business for this category. Based on 
this threshold, DOE present the following FRFA analysis:
1. Description and Estimated Number of Small Entities Regulated
    During its market survey, DOE used available public information to 
identify potential small manufacturers. DOE's research involved 
industry trade association membership directories (including AHRI), 
public databases (e.g., AHRI Directory,\76\ the SBA Database \77\), 
individual company Web sites, and market research tools (e.g., Dunn and 
Bradstreet reports \78\ and Hoovers reports \79\) to create a list of 
companies that manufacture or sell products covered by this rulemaking. 
DOE also asked stakeholders and industry representatives if they were 
aware of any other small manufacturers during manufacturer interviews 
and at DOE public meetings. DOE reviewed publicly available data and 
contacted select companies on its list, as necessary, to determine 
whether they met the SBA's definition of a small business manufacturer 
of covered automatic commercial ice makers. DOE screened out companies 
that do not offer products covered by this rulemaking, do not meet the 
definition of a ``small business,'' or are foreign owned.
---------------------------------------------------------------------------

    \76\ ``AHRI Certification Directory.'' AHRI Certification 
Directory. AHRI. (Available at: https://www.ahridirectory.org/ahridirectory/pages/home.aspx) (Last accessed October 10, 2011). See 
www.ahridirectory.org/ahriDirectory/pages/home.aspx.
    \77\ ``Dynamic Small Business Search.'' SBA. (Available at: See 
http://dsbs.sba.gov/dsbs/search/dsp_dsbs.cfm) (Last accessed October 
12, 2011).
    \78\ ``D&B[verbar]Business Information[verbar]Get Credit 
Reports[verbar]888 480-6007.''. Dun & Bradstreet (Available at: 
www.dnb.com) (Last accessed October 10, 2011). See www.dnb.com/.
    \79\ ``Hoovers[verbar]Company Information[verbar]Industry 
Information[verbar]Lists.'' D&B (2013) (Available at: See http://www.hoovers.com/) (Last accessed December 12, 2012).
---------------------------------------------------------------------------

    DOE identified 16 manufacturers of automatic commercial ice makers. 
Seven of those are small businesses manufacturers operating in the 
United States. DOE contacted each of these companies, but only one 
accepted the invitation to participate in a confidential manufacturer 
impact analysis interview with DOE contractors.
    In establishing today's standard levels, DOE has carefully 
considered the impacts on small manufacturers when establishing the 
standards for this industry. DOE's review of the industry suggests that 
the five of the seven small manufacturers identified specialize in 
industrial higher capacity ``tube'', ``flake'' or ``cracked'' ice 
machines. Industry literature indicates that these types of ice makers 
are typically designed to produce 2,000-40,000 lb/day of ice, with some 
designs going as low as 1,000 lb/day. Only at the lowest end of the 
tube, flake, and cracked ice platforms, typically 2,000 and 4,000 lb/
day, do these manufacturers have products within the scope of this 
rulemaking. Based on product listings from manufacturer Web sites, DOE 
estimates that approximately 15% of the models produced by these five 
manufacturers are covered product under today's rule.
    Of the remaining two small manufacturers, one exclusively produces 
continuous ice makers, and one exclusively produces gourmet, large 
cube, ice makers. Based on publically available information, DOE 
believes that approximately two-thirds of all the models made by the 
manufacturer of continuous machines already meet the standard, 
positioning it well compared to an industry-at-large compliance rate of 
approximately 50 percent.
    DOE estimates that 10 percent of the models made by the 
manufacturer of gourmet, large cube machines already meet the standard. 
The low percentage indicates that this manufacturer may be 
disproportionately affected by the selected standard level, but as 
discussed in section IV.B.1.f, DOE does not have nor did it receive in 
response to requests for comments sufficient specific information to 
evaluate whether larger

[[Page 4750]]

ice has specific consumer utility, nor to allow separate evaluation for 
such equipment of costs and benefits associated with achieving the 
efficiency levels considered in the rulemaking. In the absence of 
information, DOE cannot conclude that this type of ice has unique 
consumer utility justifying consideration of separate equipment 
classes. DOE notes that manufacturers of this equipment have the option 
seeking exception relief pursuant to 41 U.S.C. 7194 from DOE's Office 
of Hearings and Appeals.
    Based on a 2008 study by Koeller & Company,\80\ DOE understands 
that the ACIM market is dominated by four manufacturers who produce 
approximately 90 percent of the automatic commercial ice makers for 
sale in the United States. The four major manufacturers with the 
largest market share are Manitowoc, Scotsman, Hoshizaki, and Ice-O-
Matic. The remaining 12 large and small manufacturers account for ten 
percent of domestic sales.
---------------------------------------------------------------------------

    \80\ Koeller, John, P.E., and Herman Hoffman, P.E. A Report on 
Potential Best Management Practices. Rep. The California Urban Water 
Conservation Council, n.d. Web. 19 May 2014.
---------------------------------------------------------------------------

    DOE considered comments that all manufacturers and stakeholders 
made regarding the engineering analysis and made changes to the 
analysis, which are described in some detail in section III.IV.D. These 
changes reduced the highest efficiency levels determined to be possible 
using the design options considered in the analyses and increased the 
estimated costs associated with attaining most efficiency levels. 
Consequently, the most cost-effective efficiency levels for the final 
rule analysis were lower than for the NOPR. This applied to specific 
equipment classes associated with the products sold by some of these 
small businesses, for example continuous ice makers, IMH batch ice 
makers, and RCU batch ice makers. The energy standards were 
consequently set at efficiency levels that will be less burdensome to 
attain for the affected small businesses.
2. Description and Estimate of Compliance Requirements
    For the purposes of analysis, DOE assumes that the seven small 
domestic manufacturers of automatic commercial ice makers identified 
account for approximately 5 percent of industry shipments. While small 
business manufacturers of automatic commercial ice makers have small 
overall market share, some hold substantial market share in specific 
equipment classes. Several of these smaller firms specialize in 
producing industrial ice machines and the covered equipment they 
manufacture are extensions of industrial product lines that fall within 
the range of capacity covered by this rule. Others serve niche markets. 
Most have substantial portions of their business derived from equipment 
outside the scope of this rulemaking, as described further below, but 
are still considered small businesses based on the SBA limits for 
number of employees.
    At the new and amended levels, small business manufacturers of 
automatic commercial ice makers are expected to face negative impacts 
on INPV. For the portions of their business covered by the standard, 
the impacts are approximately four times as severe as those felt by the 
industry at large: a loss of 49.8 percent of INPV for small businesses 
alone as compared to a loss of 12.5 percent for the industry at large. 
Where conversion costs are driven by the number of platforms requiring 
redesign at a particular standard level, small business manufacturers 
may be disproportionately affected. Product conversion costs including 
the investments made to redesign existing equipment to meet new or 
amended standards or to develop entirely new compliant equipment, as 
well as industry certification costs, do not scale with sales volume. 
As small manufacturers' investments are spread over a much lower volume 
of shipments, recovering the cost of upfront investments is 
proportionately more difficult. Additionally, smaller manufacturers 
typically do not have the same technical resources and testing capacity 
as larger competitors.
    The product conversion investments required to comply are estimated 
to be over 10 times larger than the typical R&D expenditures for small 
businesses, whereas the industry as a whole is estimated to incur 4 
times larger than typical R&D expenditures. Where the covered equipment 
from several small manufacturers are adaptations of larger platforms 
with capacities above the 4,000 lb ice/24 hour threshold, it may not 
prove economical for them to invest in redesigning such a small portion 
of their product offering to meet standards.
    In confidential interviews, manufacturers indicated that many 
design options evaluated in the engineering analysis (e.g., higher 
efficiency motors and compressors) would require them to purchase more 
expensive components. In many industries, small manufacturers typically 
pay higher prices for components due to smaller purchasing volumes 
while their large competitors receive volume discounts. However, this 
effect is diminished for the automatic commercial ice maker 
manufacturing industry for two distinct reasons. One reason relates to 
the fact that the automatic commercial ice maker industry as a whole is 
a low volume industry. In confidential interviews, manufacturers 
indicated that they have little influence over their suppliers, 
suggesting the volume of their component orders is similarly 
insufficient to receive substantial discounts. The second reason 
relates to the fact that, for most small businesses, the equipment 
covered by this rulemaking represents only a fraction of overall 
business. Where small businesses are ordering similar components for 
non-covered equipment, their purchase volumes may not be as low as is 
indicated by the total unit shipments for small businesses. For these 
reasons, it is expected that any volume discount for components enjoyed 
by large manufacturers would not be substantially different from the 
prices paid by small business manufacturers.
    To estimate how small manufacturers would be potentially impacted, 
DOE developed specific small business inputs and scaling factors for 
the GRIM. These inputs were scaled from those used in the whole 
industry GRIM using information about the product portfolios of small 
businesses and the estimated market share of these businesses in each 
equipment class. DOE used this information in the GRIM to estimate the 
annual revenue, EBIT, R&D expense, and capital expenditures for a 
typical small manufacturer and to model the impact on INPV associated 
with the production of covered product; noting that for five of the 
seven small businesses in this analysis, only 15% of their product 
portfolio, which was based on review capacity ranges of the product 
offerings listed on these manufacturers' Web sites, is covered product 
under today's rule DOE then compared these impacts to those modeled for 
the industry at large, and found that small manufactures could lose up 
to 49.8 percent of the INPV associated with the production of covered 
product; as compared to a reduction in small business INPV of 78.8 
percent at the NOPR stage. Table VI.1 and Table VI.2 summarize the 
impacts on small business INPV at each TSL, and Table VI.3 and Table 
VI.4 summarize the changes in results at TSL 3, between the NOPR and 
Final Rule analysis.

[[Page 4751]]

 Table VI.1--Comparison of Small Business Manufacturers of Automatic Commercial Ice Maker INPV * to That of the
               Industry at Large by TSL Under the Preservation of Gross Margin Markup Scenario **
----------------------------------------------------------------------------------------------------------------
                                                    TSL 1        TSL 2        TSL 3        TSL 4        TSL 5
----------------------------------------------------------------------------------------------------------------
Industry at Large--Impact on INPV (%)..........        (6.2)        (9.2)       (12.5)       (15.3)       (24.6)
Small Businesses--Impact on INPV (%)...........       (18.3)       (34.2)       (48.8)       (51.5)       (57.2)
----------------------------------------------------------------------------------------------------------------
* Small business manufacturer INPV represents only the INPV associated with the production and sale of covered
  product. Many small business manufacturers produce products not covered by this rule.
** Values in parentheses are negative numbers.

 Table VI.2--Comparison of Small Business Manufacturers of Automatic Commercial Ice Maker INPV * to That of the
                   Industry at Large by TSL Under the Preservation of EBIT Markup Scenario **
----------------------------------------------------------------------------------------------------------------
                                                    TSL 1        TSL 2        TSL 3        TSL 4        TSL 5
----------------------------------------------------------------------------------------------------------------
Industry at Large--Impact on INPV (%)..........        (5.4)        (7.7)       (10.0)       (10.1)        (9.7)
Small Businesses--Impact on INPV (%)...........       (19.1)       (35.1)       (49.8)       (52.6)       (68.4)
----------------------------------------------------------------------------------------------------------------
* Small business manufacturer INPV represents only the INPV associated with the production and sale of covered
  product. Many small business manufacturers produce products not covered by this rule.
** Values in parentheses are negative numbers.

   Table VI.3--Comparison of Small Business Manufacturers of Automatic
 Commercial Ice Maker INPV * to That of the Industry at Large Under the
  Preservation of Gross Margin Markup Scenario **; NOPR vs. Final Rule
------------------------------------------------------------------------
                                                                 Final
                                                     NOPR TSL   rule TSL
                                                        3          3
------------------------------------------------------------------------
Industry at Large--Impact on INPV (%).............     (20.5)     (12.5)
Small Businesses--Impact on INPV (%)..............     (76.6)     (48.8)
------------------------------------------------------------------------
* Small business manufacturer INPV represents only the INPV associated
  with the production and sale of covered product. Many small business
  manufacturers produce products not covered by this rule.
** Values in parentheses are negative numbers.

   Table VI.4--Comparison of Small Business Manufacturers of Automatic
 Commercial Ice Maker INPV * to That of the Industry at Large Under the
       Preservation of EBIT Markup Scenario **; NOPR vs Final Rule
------------------------------------------------------------------------
                                                                 Final
                                                     NOPR TSL   rule TSL
                                                        3          3
------------------------------------------------------------------------
Industry at Large--Impact on INPV (%).............     (23.5)     (10.0)
Small Businesses--Impact on INPV (%)..............     (78.6)     (49.8)
------------------------------------------------------------------------
* Small business manufacturer INPV represents only the INPV associated
  with the production and sale of covered product. Many small business
  manufacturers produce products not covered by this rule.
** Values in parentheses are negative numbers.

3. Duplication, Overlap, and Conflict With Other Rules and Regulations
    DOE is not aware of any rules or regulations that duplicate, 
overlap, or conflict with the rule being adopted today.
4. Significant Alternatives to the Rule
    The discussion above analyzes impacts on small businesses that 
would result from DOE's new and amended standards. In addition to the 
other TSLs being considered, the rulemaking TSD includes a regulatory 
impact analysis (RIA). For automatic commercial ice making equipment, 
the RIA discusses the following policy alternatives: (1) No change in 
standard; (2) consumer rebates; (3) consumer tax credits; and (4) 
manufacturer tax credits; (5) voluntary energy efficiency targets; (6) 
bulk government purchases; and (7) extending the compliance date for 
small entities. While these alternatives may mitigate to some varying 
extent the economic impacts on small entities compared to the 
standards, DOE did not consider these alternatives further because they 
are either not feasible to implement without authority and funding from 
Congress, or are expected to result in energy savings that are much 
smaller (ranging from 39 percent to less than 53 percent) than those 
that will be achieved by the new and amended standard levels. In 
reviewing alternatives DOE analyzed a case in which the voluntary 
programs targeted efficiencies corresponding to final rule TSL 3. DOE 
also examined standards at lower efficiency levels, TSL 2 and TSL 1. 
TSL 2 achieves 25 percent lower savings than TSL 3 and TSL 1 achieves 
less than half the savings of TSL 3. (See Table V.50 for the estimated 
impacts of standards at lower TSLs.) Voluntary programs at these levels 
achieve only a fraction of the savings achieved by standards and would 
provide even lower savings benefits. As shown in Table VI.1 through 
Table VI.4, the changes to the efficiency levels comprising TSL 3 
between the NOPR and final rule resulted in a substantial reduction in 
the impacts faced by small businesses. To achieve further substantial 
reductions in small business impacts would force the standard down to 
TSL 1 levels, at the expense of substantial energy savings and NPV 
benefits, which would be inconsistent with DOE's statutory mandate to 
maximize the improvement in energy efficiency that the Secretary 
determines is technologically feasible and economically justified. DOE 
believes that establishing standards at TSL 3 provides the optimum 
balance between energy savings benefits and impacts on small 
businesses. Accordingly, DOE is declining to adopt any of these 
alternatives and is adopting the standards set forth in this 
rulemaking. (See chapter 17 of the TSD for further detail on the policy 
alternatives DOE considered.)
    Additional compliance flexibilities may be available through other 
means. For example, individual manufacturers may petition for a waiver 
of the applicable test procedure. Further, EPCA provides that a 
manufacturer whose annual gross revenue from all of its operations does 
not exceed $8,000,000 may apply for an exemption from all or part of an 
energy conservation standard for a period not longer than 24 months 
after the effective date of a final rule establishing the standard. 
Additionally, Section 504 of the Department of Energy Organization Act, 
42 U.S.C. 7194, provides authority for the Secretary to adjust a rule 
issued under EPCA in order to prevent ``special

[[Page 4752]]

hardship, inequity, or unfair distribution of burdens'' that may be 
imposed on that manufacturer as a result of such rule. Manufacturers 
should refer to 10 CFR part 430, subpart E, and part 1003 for 
additional details.
5. Response to Small Business Comments and Comments of the Office of 
Advocacy
    The Chief Counsel of the SBA Office of Advocacy submitted comments 
regarding the impact of the proposed standards on small businesses and 
recommended that DOE use its discretion to adopt an alternative to the 
proposed standard that is achievable for small manufacturers. This 
letter is posted to the docket at http://www.regulations.gov/#!docketDetail;D=EERE-2010-BT-STD-0037.
    DOE has taken several steps to minimize the impact of the new and 
amended standards on small businesses. The comments received in 
response to the proposed standards led DOE to hold an additional public 
meeting and allow stakeholders more time to submit additional 
information to DOE's consultant pursuant to non-disclosure agreements 
regarding efficiency gains and costs of potential design options. DOE 
reviewed additional market data, including published ratings of 
available ice makers, to recalibrate its engineering analysis, and as a 
result, revised the proposed TSL levels. DOE issued a NODA to announce 
the availability of the revised analysis and sought comment from 
stakeholders. In this final rule, DOE is adopting the TSL 3 presented 
in the NODA. As discussed previously, the changes to the efficiency 
levels comprising TSL 3 between the NOPR and final rule resulted in a 
standard that is less burdensome for small businesses.
    In addition, in reviewing all available data sources received in 
response to the proposed standards, DOE found that the IMH-W continuous 
class ice makers consume more condenser water than DOE assumed at the 
NOPR stage. In setting the standard for the continuous class condenser 
water use, DOE intended that the baseline reflect the existing market 
for continuous type units. Based on this new data, the standard for 
condenser water use is set at 10 percent below the baseline condenser 
water use level for IMH-W batch ice makers, rather than 20 percent, as 
was proposed in the NOPR. As a result, all IMH-W continuous class 
models produced by small business manufacturers are compliant with the 
condenser water use standard for this class.
    DOE notes that while any one regulation may not impose a 
significant burden on small business manufacturers, the combined 
effects of recent or impending regulations may have consequences for 
some small business manufacturers. In researching the product offerings 
of small business manufacturers covered by this rulemaking, DOE did not 
identify any that also manufacture products impacted by the recently 
issued energy conservation standards for commercial refrigeration 
equipment or walk-in coolers and freezers. DOE will continue to work 
with industry to ensure that cumulative impacts from its regulations 
are not unduly burdensome.
    The SBA Office of Advocacy also recommended that DOE adopt a lower 
TSL for small businesses because the level proposed in the NOPR would 
have a disproportionately negative impact on small business 
manufacturers. As discussed previously, the changes to the analysis 
between the NOPR and final rule resulted in different TSLs. As such, 
the efficiency levels comprising TSL 3 as set forth in this final rule 
result in a substantial reduction in the impacts faced by small 
business manufacturers, as compared to those proposed in the NOPR. DOE 
also examined standards at lower efficiency levels, TSL 2 and TSL 1. 
TSL 2 achieves 25 percent lower savings than TSL 3 and TSL 1 achieves 
less than half the savings of TSL 3. (See Table V.50 for the estimated 
impacts of standards at lower TSLs.) The impacts on small manufacturers 
were also considered in comparison to the impacts on larger 
manufacturers to ensure that small business would remain competitive in 
the market. Because they compete mostly in market niches not covered by 
these standards, these rules apply to about 15 percent of these 
companies product in comparison to 100 percent for large business. In 
addition, for one of the remaining two manufacturers, DOE estimates 
that approximately two-thirds of its models already meet the energy 
efficiency standard and 100 percent of its models meet the condenser 
water standard. In comparison, a typical large manufacturer will need 
to redesign half of their products to meet the new and amended 
standards. Pursuant to DOE's statutory mandate, any new or amended 
standard must maximize the improvement in energy efficiency that the 
Secretary determines is both technologically feasible and economically 
justified. DOE determined that TSL 3 will achieve significant energy 
savings and is economically justified, and therefore is adopting TSL 3 
in this final rule. DOE believes that establishing standards at TSL 3 
provides the optimum balance between energy savings benefits and 
impacts on small businesses.
    Finally, the SBA Office of Advocacy recommended that DOE consider 
extending the compliance date for small entities. DOE notes that EPCA 
requires that the amended standards established in this rulemaking must 
apply to equipment that is manufactured on or after 3 years after the 
final rule is published in the Federal Register unless DOE determines, 
by rule, that a 3-year period is inadequate, in which case DOE may 
extend the compliance date for that standard by an additional 2 years. 
(42 U.S.C. 6313(d)(3)(C)) As described previously, the standard levels 
set forth in this final rule are less stringent relative to those 
proposed in the NOPR, and fewer ice maker models will require redesign 
to meet the new standard. Therefore, DOE has determined that the 3-year 
period is adequate and is not extending the compliance date for small 
business manufacturers.

C. Review Under the Paperwork Reduction Act

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

[[Page 4753]]

that collection of information displays a currently valid OMB Control 
Number.

D. Review Under the National Environmental Policy Act of 1969

    Pursuant to the National Environmental Policy Act (NEPA) of 1969, 
DOE has determined that this final rule fits within the category of 
actions included in Categorical Exclusion (CX) B5.1 and otherwise meets 
the requirements for application of a CX. See 10 CFR part 1021, App. B, 
B5.1(b); 1021.410(b) and Appendix B, B(1)-(5). This final rule fits 
within the category of actions because it is a rulemaking that 
establishes energy conservation standards for consumer products or 
industrial equipment, and for which none of the exceptions identified 
in CX B5.1(b) apply. Therefore, DOE has made a CX determination for 
this rulemaking, and DOE does not need to prepare an Environmental 
Assessment or Environmental Impact Statement for this rule. DOE's CX 
determination for this final rule is available at http://energy.gov/nepa/categorical-exclusion-determinations-b51.

E. Review Under Executive Order 13132

    Executive Order 13132, ``Federalism.'' 64 FR 43255 (Aug. 10, 1999) 
imposes certain requirements on Federal agencies formulating and 
implementing policies or regulations that preempt State law or that 
have Federalism implications. The Executive Order requires agencies to 
examine the constitutional and statutory authority supporting any 
action that would limit the policymaking discretion of the States and 
to carefully assess the necessity for such actions. The Executive Order 
also requires agencies to have an accountable process to ensure 
meaningful and timely input by State and local officials in the 
development of regulatory policies that have Federalism implications. 
On March 14, 2000, DOE published a statement of policy describing the 
intergovernmental consultation process it will follow in the 
development of such regulations. 65 FR 13735. EPCA governs and 
prescribes Federal preemption of State regulations as to energy 
conservation for the products that are the subject of this final rule. 
States can petition DOE for exemption from such preemption to the 
extent, and based on criteria, set forth in EPCA. (42 U.S.C. 6297) No 
further action is required by Executive Order 13132.

F. Review Under Executive Order 12988

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

G. Review Under the Unfunded Mandates Reform Act of 1995

    Title II of the Unfunded Mandates Reform Act of 1995 (UMRA) 
requires each Federal agency to assess the effects of Federal 
regulatory actions on State, local, and Tribal governments and the 
private sector. Public Law 104-4, sec. 201 (codified at 2 U.S.C. 1531). 
For an amended regulatory action likely to result in a rule that may 
cause the expenditure by State, local, and Tribal governments, in the 
aggregate, or by the private sector of $100 million or more in any one 
year (adjusted annually for inflation), section 202 of UMRA requires a 
Federal agency to publish a written statement that estimates the 
resulting costs, benefits, and other effects on the national economy. 
(2 U.S.C. 1532(a), (b)) The UMRA also requires a Federal agency to 
develop an effective process to permit timely input by elected officers 
of State, local, and Tribal governments on a ``significant 
intergovernmental mandate,'' and requires an agency plan for giving 
notice and opportunity for timely input to potentially affected small 
governments before establishing any requirements that might 
significantly or uniquely affect small governments. On March 18, 1997, 
DOE published a statement of policy on its process for 
intergovernmental consultation under UMRA. 62 FR 12820. DOE's policy 
statement is also available at http://energy.gov/gc/office-general-counsel.
    DOE has concluded that this final rule would likely require 
expenditures of $100 million or more on the private sector. Such 
expenditures may include: (1) Investment in research and development 
and in capital expenditures by automatic commercial ice maker 
manufacturers in the years between the final rule and the compliance 
date for the new standards, and (2) incremental additional expenditures 
by consumers to purchase higher-efficiency automatic commercial ice 
maker, starting at the compliance date for the applicable standard.
    Section 202 of UMRA authorizes a Federal agency to respond to the 
content requirements of UMRA in any other statement or analysis that 
accompanies the final rule. 2 U.S.C. 1532(c). The content requirements 
of section 202(b) of UMRA relevant to a private sector mandate 
substantially overlap the economic analysis requirements that apply 
under section 325(o) of EPCA and Executive Order 12866. The 
SUPPLEMENTARY INFORMATION section of the notice of final rulemaking and 
the ``Regulatory Impact Analysis'' section of the TSD for this final 
rule respond to those requirements.
    Under section 205 of UMRA, the Department is obligated to identify 
and consider a reasonable number of regulatory alternatives before 
promulgating a rule for which a written statement under section 202 is 
required. 2 U.S.C. 1535(a). DOE is required to select from those 
alternatives the most cost-effective and least burdensome alternative 
that achieves the objectives of the rule unless DOE publishes an 
explanation for doing otherwise, or the selection of such an 
alternative is inconsistent with law. As required by 42 U.S.C. 6295(o), 
6313(d), this final rule would establish energy conservation standards 
for automatic commercial ice maker that are designed to achieve the 
maximum improvement in energy efficiency that DOE has determined to be 
both technologically feasible and economically justified. A full 
discussion of the alternatives considered by DOE is presented in the 
``Regulatory Impact Analysis'' chapter 17 of the TSD for today's final 
rule.

[[Page 4754]]

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

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

I. Review Under Executive Order 12630

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

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

    Section 515 of the Treasury and General Government Appropriations 
Act, 2001 (44 U.S.C. 3516, note) provides for Federal agencies to 
review most disseminations of information to the public under 
guidelines established by each agency pursuant to general guidelines 
issued by OMB. OMB's guidelines were published at 67 FR 8452 (February 
22, 2002), and DOE's guidelines were published at 67 FR 62446 (October 
7, 2002). DOE has reviewed this final rule under the OMB and DOE 
guidelines and has concluded that it is consistent with applicable 
policies in those guidelines.

K. Review Under Executive Order 13211

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

L. Review Under the Information Quality Bulletin for Peer Review

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

M. Congressional Notification

    As required by 5 U.S.C. 801, DOE will report to Congress on the 
promulgation of this rule prior to its effective date. The report will 
state that it has been determined that the rule is a ``major rule'' as 
defined by 5 U.S.C. 804(2).

VII. Approval of the Office of the Secretary

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

List of Subjects in 10 CFR Part 431

    Administrative practice and procedure, Confidential business 
information, Energy conservation, Reporting and recordkeeping 
requirements.

    Issued in Washington, DC, on December 31, 2014.
Kathleen B. Hogan,
Deputy Assistant Secretary for Energy Efficiency, Energy Efficiency and 
Renewable Energy.

    For the reasons set forth in the preamble, DOE amends part 431 of 
chapter II of title 10, of the Code of Federal Regulations, as set 
forth below:

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

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

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

0
2. Section 431.136 is revised to read as follows:

Sec.  431.136  Energy conservation standards and their effective dates.

    (a) All basic models of commercial ice makers must be tested for 
performance using the applicable DOE test procedure in Sec.  431.134, 
be compliant with the applicable standards set forth in paragraphs (b) 
through (d) of this section, and be certified to the Department of 
Energy under 10 CFR part 429 of this chapter.
    (b) Each cube type automatic commercial ice maker with capacities 
between 50 and 2,500 pounds per 24-hour period manufactured on or after 
January 1, 2010 and before January 28, 2018, shall meet the following 
standard levels:

[[Page 4755]]

----------------------------------------------------------------------------------------------------------------
                                                   Harvest
        Equipment type          Type of cooling  rate lb ice/ Maximum  energy use kWh/  Maximum  condenser water
                                                   24 hours          100 lb ice          use \1\ gal/100 lb ice
----------------------------------------------------------------------------------------------------------------
Ice-Making Head...............  Water..........         =500 and  5.58-0.0011H............  200-0.022H.
                                                      =1,436  4.0.....................  200-0.022H.
Ice-Making Head...............  Air............         =450  6.89-0.0011H............  Not Applicable.
Remote Condensing (but not      Air............       =1,000  5.1.....................  Not Applicable.
 remote compressor).
Remote Condensing and Remote    Air............         =934  5.3.....................  Not Applicable.
 remote compressor).
Self-Contained................  Water..........         =200  7.6.....................  191-0.0315H.
Self-Contained................  Air............         =175  9.8.....................  Not Applicable.
----------------------------------------------------------------------------------------------------------------
\1\ Water use is for the condenser only and does not include potable water used to make ice.
\2\ H = harvest rate in pounds per 24 hours, indicating the water or energy use for a given harvest rate.
Source: 42 U.S.C. 6313(d).

    (c) Each batch type automatic commercial ice maker with capacities 
between 50 and 4,000 pounds per 24-hour period manufactured on or after 
January 28, 2018, shall meet the following standard levels:

----------------------------------------------------------------------------------------------------------------
                                                   Harvest       Maximum  energy use
        Equipment type          Type of cooling  rate lb ice/ kilowatt-hours (kWh)/100  Maximum  condenser water
                                                   24 hours          lb ice \1\          use gal/100 lb ice \2\
----------------------------------------------------------------------------------------------------------------
Ice-Making Head...............  Water..........        =300 and  5.80-0.00191H...........  200-0.022H.
                                                        =850 and  4.42-0.00028H...........  200-0.022H.
                                                      =1,500 and  4.0.....................  200-0.022H.
                                                      =2,500 and  4.0.....................  145.
                                                      = 300 and  7.05-0.0025H............  NA.
                                                       = 800 and  5.55-0.00063H...........  NA.
                                                     = 1500 and  4.61....................  NA.
                                                     = 988 and  4.59....................  NA.
 remote compressor).                                 = 930 and  4.79....................  NA.
 Compressor.                                         = 200 and  5.7.....................  191-0.0315H.
                                                     = 2,500  5.7.....................  112.
                                                 and = 110 and  12.42-0.02533H..........  NA.
                                                       = 200 and  7.35....................  NA.
                                                      Maximum  energy use kWh/  Maximum  condenser water
                                                   24 hours        100 lb ice \1\        use gal/100 lb ice \2\
----------------------------------------------------------------------------------------------------------------
Ice-Making Head...............  Water..........         =801 and  4.34....................  180-0.0198H.
                                                      =2,500 and  4.34....................  130.5.
                                                      =310 and  8.23-0.0032H............  NA.
                                                        =820 and  5.61....................  NA.
                                                      =800 and  5.06....................  NA.
 remote compressor).                                  =800 and  5.26....................  NA.
                                                      =900 and  4.88....................  153-0.0252H.
                                                      =2,500 and  4.88....................  90.
                                                      =200 and  9.47-0.00624H...........  NA.
                                                        =700 and  5.1.....................  NA.
                                                      
(202)616-2645 (Fax)

December 24, 2014

Eric J. Fygi, Deputy General Counsel, Department of Energy, 
Washington, DC 20585

Re: Energy Conservation Standards for Automatic Commercial Ice 
Makers,

Dear Deputy General Counsel Fygi:

    I am responding to your December 3, 2014 letter seeking the 
views of the Attorney General about the potential impact on 
competition of proposed energy conservation standards for automatic 
commercial ice makers. Your request was submitted under Section 
325(o)(2)(B)(i)(V) of the Energy Policy and Conservation Act, as 
amended (ECPA), 42 U.S.C. 6295(o)(2)(B)(i)(V), which requires the 
Attorney General to make a determination of the impact of any 
lessening of competition that is likely to result from the 
imposition of proposed energy conservation standards. The Attorney 
General's responsibility for responding to requests from other 
departments about the effect of a program on competition has been 
delegated to the Assistant Attorney General for the Antitrust 
Division in 28 CFR Sec. 0.40(g).
    In conducting its analysis the Antitrust Division examines 
whether a proposed standard may lessen competition, for example, by 
substantially limiting consumer choice, by placing certain 
manufacturers at an unjustified competitive disadvantage, or by 
inducing avoidable inefficiencies in production or distribution of 
particular products. A lessening of competition could result in 
higher prices to manufacturers and consumers.
    We have reviewed the proposed standards contained in the Notice 
of Proposed Rulemaking (79 FR 14848, March 17, 2014) (NOPR). In 
light of the short time frame for our review of the proposed 
standards, we also consulted with DOE staff on the issues raised by 
the proposed NOPR.
    Based on this review and consultation with DOE staff, our 
conclusion is that the proposed energy conservation standards for 
automatic commercial ice makers are unlikely to have a significant 
adverse impact on competition.

Sincerely,

William J. Baer

Enclosure

[FR Doc. 2015-00326 Filed 1-27-15; 8:45 am]
BILLING CODE 6450-01-P
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