CHAPTER 1. INTRODUCTION 

TABLE OF CONTENTS 

1.1	 PURPOSE OF THE DOCUMENT ................................................................................. 1-1
 

1.2	 OVERVIEW OF ENERGY CONSERVATION STANDARDS FOR RESIDENTIAL
 

CENTRAL AIR CONDITIONERS AND HEAT PUMPS ............................................. 1-1
 

1.2.1 Small-Duct, High-Velocity Systems .................................................................... 1-2
 

1.2.2 Space-Constrained Products ................................................................................ 1-5
 

1.2.2.1 Single-Package Vertical Units (SPVUs) .................................................. 1-5
 

1.2.2.2 Through-the-Wall Systems ...................................................................... 1-6
 

1.2.2.3 Single-Package Non-Weatherized Units .................................................. 1-6
 

1.2.3 Ductless Split Systems......................................................................................... 1-7
 

1.3 PROCESS FOR SETTING ENERGY CONSERVATION STANDARDS ................... 1-7
 

1.4 STRUCTURE OF THE DOCUMENT.......................................................................... 1-10
 

LIST OF TABLES 

Table 1.3.1 Central Air Conditioning Analyses Under the Process Rule ................................... 1-2 
 

CHAPTER 1. INTRODUCTION 

1.1 PURPOSE OF THE DOCUMENT 

This preliminary technical support document (preliminary TSD) is a stand-alone report 

that provides the technical analyses and results supporting the information presented in the 

preliminary notice of public meeting (NOPM) and executive summary for residential clothes 

dryers and room air conditioners. This preliminary TSD reports on the preliminary activities and 

analyses conducted in the period preceding the notice of proposed rulemaking (NOPR) of this 

rulemaking. 

1.2	 OVERVIEW OF ENERGY CONSERVATION STANDARDS FOR 

RESIDENTIAL CENTRAL AIR CONDITIONERS AND HEAT PUMPS 

The National Appliance Energy Conservation Act of 1987 (NAECA) established energy 

conservation standards for central air conditioners and heat pumps as well as requirements for 

determining whether these standards should be amended. Specifically, NAECA established 

energy conservation standards for central air conditioners and heat pumps in the form of 

minimum limits on the seasonal energy efficiency ratio (SEER) for air conditioners and for heat 

pumps operating in the cooling mode, and on the heating seasonal performance factor (HSPF) 

for heat pumps operating in the heating mode. NAECA established the following standards for 

central air conditioners and heat pumps: 10.0 SEER/6.8 HSPF for split systems,1

 9.7 SEER/6.6 

HSPF for single-package systems.2

 These standards became effective January 1, 1992 for split 

systems; standards for single-package systems came into effect one year later. See 42 U.S.C. 

6295(d)(1)(A)-(B) and (2)(A)-(B). NAECA also required that DOE conduct two cycles of 

rulemakings to determine if more stringent standards are economically justified and 

technologically feasible. (42 U.S.C. 6295(d)(3)(A)-(B)) 

Pursuant to 42 U.S.C. 6295(d)(3)(A), DOE published a final rule in the Federal Register 

on January 22, 2001 (2001 final rule), amending the energy conservation standards for central air 

conditioners and heat pumps. 66 FR 7170. The amended standards would have increased the 

minimum SEER to 13 and the minimum HSPF to 7.7. Id. This final rule constituted the first 

cycle of revised standards for central air conditioners and heat pumps. 

Shortly after the publication of the 2001 final rule, DOE postponed the effective date of 

the rule to take time to reconsider the amended standards for central air conditioners and heat 

pumps. DOE eventually promulgated a 12 SEER standard in a final rule published May 23, 

1

 “Split systems” consist of outdoor and indoor units which are “split” from each other and connected via refrigerant 

tubing. The outdoor unit resides outdoors and consists of a compressor, heat exchanger coil, fan, and fan motor. 

The indoor unit, consisting of a heat exchanger coil, resides either within a furnace or blower-coil unit, and 

conditioned air is conveyed to the home via ducts

2

 In “single-package systems,” all the components that comprise a split system, including the air circulation 

equipment, are placed in a single cabinet. The single-package system resides outdoors, and conditioned air is 

conveyed to the home via ducts. 

1-1 
 

 

 

 

2002 (2002 final rule), 67 FR 36368, but the U.S. Court of Appeals for the Second Circuit ruled 

that DOE had done so improperly. Natural Resources Defense Council v. Abraham, 355 F.3d 

179 (2d Cir. 2004). As a result, DOE published a technical amendment on August 17, 2004, 

which established a 13 SEER standard for all central air conditioners and heat pumps, excluding 

through-the-wall and space-constrained systems. 69 FR 50997. 

EPCA was further amended by the Energy Policy Act of 2005 (EPACT), Pub. L. 109-58. 

In Section 141 of EPACT, Congress directed DOE to submit an initial report regarding a plan for 

expeditiously prescribing new or revised standards. Pursuant to Section 141 of EPACT, DOE 

submitted an implementation report3

 to Congress in January 2006. This report specified a 

schedule for the completion of the second rulemaking cycle of revised standards for central air 

conditioners and heat pumps, requiring DOE to publish a final rule by June 2011, with a 

standards compliance effective date of June 2016. In separate court proceedings (New York v. 

Bodman, No. 05 Civ. 7807 (S.D.N.Y. filed Sept. 7, 2005) and Natural Resources Defense 

Council v. Bodman, No. 05 Civ. 7808 (S.D.N.Y. filed Sept. 7, 2005) the resulting consent decree 

(filed November 6, 2006) adopted the schedule for central air conditioners and heat pumps that 

DOE published in the January 2006 report to Congress (i.e., June 30, 2011). 

More recently, EPCA was amended by the Energy Independence and Security Act of 

2007 (EISA 2007), Pub. L. 110-140. In Section 306 of EISA 2007, Congress directed DOE to 

consider regional standards for central air conditioners and heat pumps (among other products), 

for one or two regions in addition to a base national standard. (42 U.S.C. 6295(o)(6)) EISA 

2007 states that in considering regional standards, DOE may consider regions made up of 

contiguous States only. Further, in Section 310 of EISA 2007, Congress directed DOE to 

consider amended test procedures and standards for standby-mode and off-mode energy 

consumption by covered equipment (such as central air conditioners and heat pumps) for any 

amended standard published after July 1, 2010. (42 U.S.C. 6295(gg)(3)) Because this energy 

conservation standards rulemaking for central air conditioners and heat pumps will be completed 

in 2011, the requirement to incorporate standby-mode and off-mode energy use into the energy 

conservation standards analysis is applicable. 

1.2.1 Small-Duct, High-Velocity Systems 

DOE initially sought to create a separate product class for small-duct, high velocity 

(SDHV) systems. DOE reasoned that SDHV systems have design considerations (confined 

installation spaces, high pressure drops, and blower motor power) that warrant special 

consideration in the analytical and standards-setting process. In the 1999 Supplemental Advance 

Notice of Proposed Rulemaking (SANOPR) (1999 SANOPR; 64 FR 66306 (Nov. 24, 1999)) for 

central air conditioners, DOE proposed the creation of a separate class of “space-constrained” 

products that included SDHV systems and requested feedback from stakeholders on the proposal 

to create a separate product class for SDHV systems. However, DOE received feedback on the 

1999 SANOPR that indicated some SDHV units were capable of reaching 12 SEER, and that 

manufacturers were making investments to produce more efficient SDHV systems. 

3

 Energy Conservation Standards Activities, January 2006. This document can be downloaded from the DOE 

website at: http://www.eere.energy.gov/buildings/appliance_standards/2006_schedule_setting.html. 

1-2 
 

For these reasons, in the October 5, 2000, NOPR (2000 NOPR; 65 FR 59590), DOE 

proposed not to create a separate SDHV product class, instead requiring SDHV systems to meet 

the standards for conventional split and single-package systems.4

 However, DOE also proposed 

to allow SDHV systems the option to test as coil-only products. This additional provision in the 

test procedure was estimated to provide an additional 1 to 2.5 SEER points for SDHV systems, 

making it easier for manufacturers to meet the standard. DOE again requested feedback from 

stakeholders on this proposal. 

On January 22, 2001, DOE published the 2001 final rule, establishing a 13 SEER standard 

for conventional split and single-package systems and reiterating that the characteristics of 

available SDHV systems did not warrant the creation of a separate product class. 66 FR at 7197 

DOE explained that revisions to the test procedure would allow testing as coil-only products, and 

stated that SDHV systems were, therefore, subject to the 13 SEER standards being adopted for 

all split-system and single-package air conditioners and heat pumps. 

On July 25, 2001, in response to a petition for reconsideration and as a result of review 

under the President’s Regulatory Review Plan,5

 DOE reopened the standards rulemaking and 

published a Supplemental Notice of Proposed Rulemaking (SNOPR), in which DOE proposed to 

withdraw its January 22, 2001 final rule. 66 FR 38822. As a substitute, DOE proposed 

standards in that SNOPR which would have set a 12 SEER standard for all split-system and 

single-package air conditioners and heat pumps, thereby resulting in a 20 percent increase in the 

minimum energy efficiency levels over prior levels. Again, DOE proposed not to establish a 

separate class for SDHV systems on the grounds that they would be able to meet the 12 SEER 

standard. 

In the subsequent May 23, 2002 final rule, DOE adopted the 12 SEER standard for splitsystem and single-package air conditioners and heat pumps, and responded to additional 

comments from stakeholders on SDHV systems. 67 FR 36368. Further information submitted 

by stakeholders led DOE to conclude that separate standards for SDHV systems were indeed 

warranted, and DOE stated it would perform a separate analysis to determine appropriate 

standard levels. A new product class and definition for SDHV systems were established, and 

standards were set at the 10 SEER NAECA level until a full analysis could be performed. 

Further, DOE stated it would consider stakeholders’ requests that the DOE test procedure be 

amended to allow special testing provisions for SDHV products. At the time of drafting the 

2002 final rule, DOE had begun a separate engineering and life-cycle cost analysis to determine 

appropriate standard levels for SDHV products. 

However, DOE’s efforts to reopen its rulemaking setting energy conservation standard 

levels for central air conditioners and heat pumps were challenged by a number of advocacy 

groups. In its decision in Natural Resources Defense Council, et al. v. Abraham, the Second 

Circuit Court concluded that “the May 23, 2002, final rules promulgated by DOE withdrawing 

the standards it published as a final rule on January 22, 2001, and replacing them with less 

4

 Standards for conventional systems were proposed at 12 SEER for split and single-package air conditioners and 13 

SEER for split-system and single-package heat pumps.

5

 The Regulatory Review Plan, which called for agencies to (among other things) withdraw or postpone the effective 

dates of regulations pending review by the White House, was published in the Federal Register at 66 FR 7702 (Jan. 

24, 2001).
 

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stringent standards, were not a valid exercise of DOE's authority under the EPCA,” in light of the 

“anti-backsliding” provision in 325(o)(1) of EPCA. Section 325(o)(1) of EPCA states that “[t]he 

Secretary may not prescribe any new or amended standard which increases the maximum 

allowable energy use...of a covered product.” 355 F.3d 179, 206 (2d Cir. 2004). Accordingly, 

DOE published a technical amendment on August 17, 2004 (2004 Technical Amendment; 69 FR 

50997). This technical amendment replaced standard levels established by the 2002 final rule 

(12 SEER) with the 13 SEER standards established in the 2001 final rule. 

Because the 2001 final rule did not establish a separate class or separate standards for 

SDHV systems, and because SDHV systems are not considered “space constrained” (see 

discussion in 66 FR at 7197 and 65 FR at 59609-10), they are covered by the 13 SEER/7.7 HSPF 

standard adopted in that rule. The Court’s ruling prohibits DOE from adopting a standard of less 

than 13 SEER for SDHV systems, despite DOE’s more recent conclusion that SDHV systems 

have a maximum technologically feasible efficiency of just over 13 SEER.6 

Further, in the test procedures detailed in the October 11, 2005 final rule, DOE stated that 

test procedure revisions to allow SDHV systems to test as coil-only units would result in 

unrealistic SEER ratings and would discourage manufacturers from making efficiency 

improvements to blower motors. 70 FR at 59124. Therefore, DOE did not amend the test 

procedure to allow testing of SDHV systems as coil-only units, making it more likely that SDHV 

products would be unable to meet even the 12 SEER standard. DOE advised manufacturers of 

SDHV systems of the procedure available under section 504 of the DOE Organization Act (42 

U.S.C. 7194), which allows them to request relief from hardship or inequity caused by a 

regulation issued under EPCA. 

On May 24, 2004, SpacePak and Unico, Inc., filed a joint application with the Office of 

Hearings and Appeals (OHA) for exception from the 13 SEER standard, arguing that they would 

suffer a “serious hardship and unfair distribution of burdens” if forced to comply with the 13 

SEER rule (case nos. TEE-0010 and TEE-0011) The OHA granted the exception to SpacePak 

and Unico, citing technological constraints (compact indoor coils, high static-pressure losses, and 

higher fan motor power) that make it more difficult for SDHV systems to increase energy 

efficiency. Also cited was the serious hardship to SpacePak and Unico that would result should 

exception relief not be granted, possibly resulting in “the loss of all sales within the United 

States.” The OHA further noted that the unavailability of SDHV systems would negatively 

impact domestic consumers, and that granting exception relief would not have a significant 

impact upon competition in the air conditioner industry. On October 14, 2004, the OHA granted 

exception relief to SpacePak and Unico, Inc., authorizing them to manufacture and sell SDHV 

systems that meet an 11 SEER/6.8 HSPF standard. This decision became effective January 23, 

2006, and remains in effect until DOE establishes a different standard for SDHV systems. 

On September 28, 2005, Energy Savings Products, Ltd. (ESP), filed its own application 

for exception relief with the OHA (case no. TEE-0026). ESP asserted that it would suffer a 

6

 In 2002, DOE performed a separate engineering analysis for SDHV systems by evaluating the incremental costs 

and efficiency improvements associated with design changes to blower coil units and pairing of existing SDHV 

blower coil units with higher-efficiency outdoor units. In that analysis, DOE found that the maximum 

technologically feasible (“max-tech”) efficiency of SDHV systems was just over 13 SEER. 

http://eere.energy.gov/buildings/appliance_standards/residential/pdfs/engineering_analysis_112602.pdf 

1-4 
 

 

gross inequity, serious hardship, and an unfair distribution of burdens if forced to comply with 

the 13 SEER standard. On December 20, 2005, the OHA granted the exception relief to ESP, 

citing the same reasons given in the SpacePak/Unico decision and authorizing Energy Savings 

Products to manufacture and sell SDHV systems that meet an 11 SEER/6.8 HSPF standard. This 

decision also became effective January 23, 2006, and remains in effect until DOE establishes a 

different standard for SDHV systems. 

1.2.2 Space-Constrained Products 

In the 1999 SANOPR, DOE first suggested separate product classes as a way to set 

standards for space-constrained niche products. 64 FR at 66310. Originally, these products 

included ductless split systems, SDHV systems, single-package vertical units (SPVU), and 

through-the-wall (TTW) split systems. In the subsequent 2000 NOPR, through-the-wall 

packaged and non-weatherized single-package products were also considered space constrained. 

65 FR at 59597. DOE’s efforts to establish standards for each of these types of products is 

explained below. 

In the 2004 Technical Amendment, DOE established a separate product class for spaceconstrained systems and required them to meet a 12 SEER/7.4 HSPF standard. Product classes 

were also set for split-system and single-package TTWs, with standards at 10.9 SEER/7.1 HSPF 

and 10.6 SEER/7.0 HSPF, respectively. The separate product class for TTW products is set to 

expire January 23, 2010, which will return those products to the space-constrained product class 

and require them to meet the 12 SEER/7.4 HSPF standard. 

Currently, ductless split systems are not considered a space-constrained product and are 

not given special consideration. They are, therefore, required to meet the 13 SEER/7.7 HSPF 

standards for split-system and single-package air conditioners and heat pumps. SDHV systems 

are also not considered space constrained, and are required to meet the 13 SEER/7.7 HSPF 

standards. 

In this rulemaking, DOE is reevaluating whether to give special consideration to these 

space-constrained products. Below, the history of each type of product is reviewed, and DOE’s 

approach for how to handle each type in this rulemaking is presented. 

1.2.2.1 Single-Package Vertical Units (SPVUs) 

In the 2000 NOPR, DOE stated that SPVUs are not covered by standards for residential 

products. 65 FR at 59610. EISA 2007 added definitions7

 and standards8 for SPVUs. While 

7

 Section 314 of EISA 2007 codifies definitions for “single package vertical air conditioner” and “single package 

vertical heat pump.” The term “single package vertical air conditioner” means “air-cooled commercial package air 

conditioning and heating equipment that (A) is factory-assembled as a single package that (i) has major components 

that are arranged vertically; (ii) is an encased combination of cooling and optional heating components; and (iii) is 

intended for exterior mounting on, adjacent interior to, or through an outside wall; (B) is powered by a single- or 3-

phase current; (C) may contain 1 or more separate indoor grilles, outdoor louvers, various ventilation options, indoor 

free air discharges, ductwork, well plenum, or sleeves; and (D) has heating components that may include electrical 

resistance, steam, hot water, or gas, but may not include reverse cycle refrigeration as a heating means.” The term 

“single package vertical heat pump” means “a single package vertical air conditioner that (A) uses reverse cycle 

1-5 
 

 

 

 

EISA 2007 defined SPVUs as commercial equipment, residential single-package TTW products 

are still considered a part this rulemaking. 

1.2.2.2 Through-the-Wall Systems 

In the 2000 NOPR, DOE recognized TTW products as being a niche category of products 

with space constraints, and proposed adopting an 11 SEER standard for them. 65 FR at 59610. 

However, in light of stakeholders’ concerns that TTW products would not be able to meet the 13 

SEER standard, the 2001 Final Rule did not set standards for TTW products, pending completion 

of later rulemaking proceedings. Prior to the subsequent 2001 SNOPR, DOE performed 

engineering and life-cycle cost analyses for TTW products to determine appropriate standard 

levels. Based on those analyses, DOE concluded that 10.9 SEER/7.1 HSPF and 10.6 SEER/7.0 

HSPF were the appropriate standards for split-system and single-package TTW products, 

respectively, and adopted those standards in the 2002 final rule. 67 FR 36368 In the 2004 

Technical Amendment, DOE explained that the standards for TTW products, which fall within 

the definition of “space-constrained product,” would be those set in the 2002 final rule. 

The definition of “through-the-wall air conditioner and heat pump” that DOE adopted in 

10 CFR 430.2 provides that this product class exists only for products manufactured prior to 

January 23, 2010. After that date, the standards for space-constrained products (12 SEER/7.4 

HSPF) will apply to TTW split-system and packaged air conditioners and heat pumps. Because 

this “sunset” provision takes place well before the effective date of this rule (2016), DOE will 

evaluate standards for TTW products based on an assumed baseline of 12 SEER/7.4 HSPF. 

Manufacturers will have six years between the time TTW products must meet the 12 SEER/7.4 

HSPF standard and the time new standards adopted in this rulemaking become effective. 

1.2.2.3 Single-Package Non-Weatherized Units 

In the 2000 NOPR, DOE recognized single-package non-weatherized units as having 

space constraints, but due to the availability of models at the 12 SEER level (the proposed 

standard level for conventional air conditioners in that rulemaking), DOE did not propose a 

separate product class for them. 65 FR at 59610. Additionally, DOE concluded it would be 

difficult to define these products in such a way that would avoid the creation of a loophole 

whereby conventional products could take advantage of lower standards. In the 2001 final rule, 

DOE again made mention of single-package non-weatherized units, but DOE decided to include 

them as a type of space-constrained product. The 2001 final rule established a new product class 

for space-constrained products, but did not set standards in that rule pending completion of later 

rulemaking proceedings. In the subsequent 2001 SNOPR and the 2002 final rule, no specific 

mention was made of single-package non-weatherized units, but DOE still considered them as a 

type of space-constrained product. In the 2002 final rule, DOE concluded that space-constrained 

products (excluding TTW products) would be able to meet the 12 SEER standard for 

conventional products, and did not adopt separate standards for those considered space 

constrained. Ultimately, in the 2004 Technical Amendment, DOE explained that the ruling by 

refrigeration as its primary heat source; and (B) may include secondary supplemental heating by means of electrical 

resistance, steam, hot water, or gas.’’ (42 U.S.C. 6311(22)-(23))
 8

 Section 314 of EISA 2007 set standards at 9.0 EER for single-package vertical air conditioners and 9.0 EER/3.0 

coefficient of performance (COP) for single-package vertical heat pumps.
 

1-6 
 

the Second Circuit Court of Appeals in Natural Resources Defense Council v. Abraham did not 

affect the standards established for space-constrained products in the 2002 final rule, since the 

2001 final rule did not establish any standards for space-constrained products. Therefore, the 12 

SEER standard established in the 2002 final rule was adopted for all space-constrained products, 

except those with TTW condensers. 

1.2.3 Ductless Split Systems 

Ductless split systems were included in the revisions to the DOE test procedure in the 

March 14, 1987 final rule. 53 FR 8304. In the 1999 SANOPR, DOE first suggested separate 

product classes as a way to set standards for niche products, including ductless split systems. 64 

FR at 66310. Since consumers may consider the interior units of mini- and multi-splits to be 

more intrusive than ducted systems, manufacturers strive to make them as compact as possible. 

After receiving stakeholder feedback, DOE decided that a separate product class was not 

warranted, and ultimately in the final rule that set the current standards, ductless split systems 

were required to meet the 13 SEER standards developed for regular split-system air conditioners 

and heat pumps. 66 FR at 7197. 

Prior to the latest revision to the test procedure, manufacturers of ductless split systems 

applied for and received waivers from the test procedure because of the differences between 

multi-split systems and traditional split-system air conditioners and heat pumps. In the most 

recent final rule revising the central air conditioner and heat pump test procedure, DOE 

responded to stakeholder comments regarding changes to the test procedure for multi-splits. 72 

FR at 59906, 59908-11 and 59913-14 (Oct. 22, 2007). Stakeholders asserted that multi-split 

systems should be rated using EER if those systems compete primarily with room air 

conditioners and SEER if they compete primarily with ducted residential systems. DOE 

responded in the October 2007 rule that it believes residential-size multi-split systems compete 

primarily with ducted systems, and that consumers will best be served if multi-split systems are 

rated using SEER. This will allow consumers to make direct comparisons of efficiency levels 

when considering system options. 

1.3 PROCESS FOR SETTING ENERGY CONSERVATION STANDARDS 

Under EPCA, when DOE studies new or amended standards, it must consider to the 

greatest extent practicable the following seven factors: 

(1) the economic impact of the standard on the manufacturers and consumers of the 

products subject to the standard; 

(2) the savings in operating costs throughout the estimated average life of the products 

in the type (or class) compared to any increases in the price, initial charges, or 

maintenance expense for the products that are likely to result from the imposition 

of the standard; 

(3) the total projected amount of energy savings likely to result directly from the 

imposition of the standard; 

1-7 
 

 

(4) any lessening of the utility or the performance of the products likely to result from 

the imposition of the standard; 

(5) the impact of any lessening of competition, as determined in writing by the 

Attorney General, that is likely to result from the imposition of the standard; 

(6) the need for national energy conservation; and 

(7) other factors the Secretary considers relevant. (42 U.S.C. 6295(o)(2)(B)(i)) 

Other statutory requirements are set forth in 42 U.S.C. 6295(o)(1)-(2)(A), (2)(B)(ii)-(iii), 

and (3)-(4). 

DOE considers the participation of interested parties a very important part of the process 

for setting energy conservation standards. Through formal public notifications (i.e., Federal 

Register notices), DOE encourages the participation of all interested parties during the comment 

period in each stage of the rulemaking. Beginning with the framework document and during 

subsequent comment periods, interactions among interested parties provide a balanced 

discussion of the information that is required for the standards rulemaking. 

Before DOE determines whether to adopt a proposed energy conservation standard, it 

must first solicit comments on the proposed standard. (42 U.S.C 6313(a)(6)(B)(i)) Any new or 

amended standard must be designed to achieve significant additional conservation of energy and 

be technologically feasible and economically justified. (42 U.S.C. 6313(a)(6)(A)) To determine 

whether economic justification exists, DOE must review comments on the proposal and 

determine that the benefits of the proposed standard exceed its burdens to the greatest extent 

practicable, weighing the seven factors listed above. (42 U.S.C. 6295(o)(2)(B)(i)) 

After the publication of the framework document, the energy conservation standards 

rulemaking process involves three additional, formal public notices, which DOE publishes in the 

Federal Register. The first of the rulemaking notices is a NOPM, which is designed to publicly 

vet the models and tools used in the preliminary rulemaking and to facilitate public participation 

before the NOPR stage. The second notice is the NOPR, which presents a discussion of 

comments received in response to the NOPM and the preliminary analyses and analytical tools; 

analyses of the impacts of potential amended energy conservation standards on consumers, 

manufacturers, and the Nation; DOE’s weighting of these impacts of amended energy 

conservation standards; and the proposed energy conservation standards for each product. The 

third notice is the final rule, which presents a discussion of the comments received in response to 

the NOPR; the revised analyses; DOE’s weighting of these impacts; the amended energy 

conservation standards DOE is adopting for each product; and the effective dates of the amended 

energy conservation standards. 

In June 2008, DOE published a notice of public meeting and availability of the framework 

document. 73 FR 32243 (June 6, 2008) The framework document, Rulemaking Framework for 

Residential Central Air Conditioners and Heat Pumps, describes the procedural and analytical 

approaches DOE anticipated using to evaluate the establishment of energy conservation 

standards for CAC. This document is available at: 

1-8 
 

 

 

 

http://www1.eere.energy.gov/buildings/appliance_standards/residential/central_ac_hp_standard 

s.html. 

Subsequently, DOE held a public meeting on June 12, 2008, to discuss procedural and 

analytical approaches to the rulemaking, and to inform and facilitate stakeholders’ involvement 

in the rulemaking process. The analytical framework presented at the public meeting described 

different analyses, such as the engineering analysis and the life-cycle cost (LCC) and payback 

period (PBP) analyses, the methods proposed for conducting them, and the relationships among 

the various analyses. See 

 for all the analyses discussed at the public meeting to be undertaken in each of the formal 

public rulemaking documents. 

Table 1.3.1 Analyses During Each Rulemaking Stage 

Preliminary Analyses NOPR Final Rule* 

Market and Technology Assessment Revised Preliminary Analyses Revised NOPR Analyses 

Screening Analysis Life-Cycle Cost Sub-Group 

Analysis 

Engineering Analysis Manufacturer Impact Analysis 

Energy Use Characterization Utility Impact Analysis 

Markups to Determine Equipment Price Employment Impact Analysis 

Life-Cycle Cost and Payback Period 

Analyses 

Environmental Assessment 

Shipments Analysis Regulatory Impact Analysis 

National Impact Analysis 

Preliminary Manufacturer Impact Analysis 

* During the Final Rule phase, DOE considers the comments submitted by the U.S. Department of Justice in the 

NOPR phase concerning the impact of any lessening of competition that is likely to result from the imposition of the 

standard. (42 U.S.C. 6295(o)(2)(B)(v)) 

As part of the information gathering and sharing process, DOE organized and held 

interviews with CAC manufacturers. DOE selected companies that represented production of all 

types of CAC equipment, ranging from small to large manufacturers, and including both AirConditioning, Heating and Refrigeration Institute (AHRI) member companies and non-AHRI 

member companies. DOE had four objectives for these interviews: (1) solicit feedback on the 

draft engineering analysis (including methodology, production costs, manufacturing processes, 

and findings); (2) solicit feedback on topics related to the preliminary manufacturer impact 

analysis; (3) provide an opportunity, early in the rulemaking process, to express specific 

concerns to DOE; and (4) foster cooperation between the manufacturers and DOE. 

There were six general topics related to the preliminary manufacturer impact analysis 

discussed during each of the interviews: (1) general key issues, (2) CAC shipment projections, 

(3) capital conversion costs, (4) product mix and profitability, (5) market shares and industry 

consolidation, and (6) cumulative regulatory burden. 

DOE incorporated the information gathered at the meetings into its engineering analysis 

(see chapter 5) and the preliminary manufacturer impact analysis (see chapter 12). Following the 

publication of the preliminary analysis and the preliminary analysis public meeting, DOE intends 

1-9 
to hold additional meetings with manufacturers as part of the consultative process for the 

manufacturer impact analysis conducted during the NOPR phase of the rulemaking. 

DOE developed spreadsheets for the LCC, PBP, and national impact analyses. DOE 

developed an LCC spreadsheet that calculates the LCC and PBP at various energy efficiency 

levels. DOE also developed a national impact analysis spreadsheet that calculates the national 

energy savings (NES) and national net present values (NPVs) at various energy efficiency levels. 

This spreadsheet includes a model that forecasts the impacts of amended energy conservation 

standards at various levels on product shipments. 

1.4 STRUCTURE OF THE DOCUMENT 

This preliminary TSD outlines the analytical approaches used in this rulemaking. The 

TSD consists of 17 chapters, an environmental assessment, a regulatory impact analysis, and 

appendices. 

Chapter 1 Introduction: provides an overview of the appliance and equipment 

standards program and how it applies to the CAC rulemaking, and outlines 

the structure of the document. 

Chapter 2 Analytical Framework, Comments from Interested Parties, and DOE 

Responses: describes the rulemaking process step by step, summarizes 

comments made from interested parties during the framework document 

comment period, and provides DOE responses to those comments. 

Chapter 3 Market and Technology Assessment: characterizes the CAC equipment 

market and the technologies available for increasing equipment efficiency. 

Chapter 4 Screening Analysis: determines which technology options are viable for 

consideration in the engineering analysis. 

Chapter 5 Engineering Analysis: discusses the methods used for developing the 

relationship between increased manufacturer price and increased 

efficiency. 

Chapter 6 Markups to Determine Product Price: discusses the methods used for 

establishing markups for converting manufacturer prices to customer 

product prices. 

Chapter 7 Energy Use Characterization: discusses the process used for generating 

energy-use estimates of CAC for a variety of product classes, climate 

locations, and standard levels. 

Chapter 8 Life-Cycle Cost and Payback Period Analyses: discusses the economic 

effects of standards on individual customers and users of the products and 

compares the LCC and PBP of products with and without higher 

efficiency standards. 

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Chapter 9 Shipments Analysis: discusses the methods used for forecasting 

shipments with and without higher efficiency standards. 

Chapter 10 National Impact Analysis: discusses the methods used for forecasting 

national energy consumption and national economic impacts based on 

annual product shipments and estimates of future product efficiency 

distributions in the absence and presence of higher efficiency standards. 

Chapter 11 Life-Cycle Cost Sub-Group Analysis: discusses the effects of standards 

on a subgroup of CAC customers and compares the LCC and PBP of 

products with and without higher efficiency standards for these customers. 

Chapter 12 Preliminary Manufacturer Impact Analysis: discusses the effects of 

standards on the finances and profitability of product manufacturers. 

Chapter 13 Utility Impact Analysis: discusses the effects of standards on the installed 

generation capacity of electric utilities. 

Chapter 14 Employment Impact Analysis: discusses the effects of standards on 

National employment. 

Chapter 15 Environmental Assessment: discusses the effects of standards on airborne emissions of electric utilities. 

Chapter 16 Regulatory Impact Analysis: discusses the present regulatory actions as 

well as the impact of non-regulatory alternatives to setting energy 

efficiency standards. 

Chapter 17 Regional Standards Impacts on Market Participants: discusses the effects 

of regional standards on distributors, dealers, contractors, and installers. 

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