45500 Federal Register / Vol. 69, No. 145 / Thursday, July 29, 2004 / Proposed Rules 

Washington, DC, 20585. Those 

stakeholders who want to attend the 

public meeting should notify Ms. 

Brenda Edwards-Jones at (202) 586–

2945. Foreign nationals visiting DOE 

Headquarters are subject to advance 

security screening procedures, requiring 

a 30-day advance notice. A foreign 

national who wishes to participate in 

the meeting, must tell DOE of this fact 

as soon as possible by contacting Ms. 

Brenda Edwards-Jones to initiate the 

necessary procedures. 

B. Procedure for Submitting Requests To 

Speak 

Any person who has an interest in 

today’s notice, or who is a 

representative of a group or class of 

persons that has an interest in these 

issues, may request an opportunity to 

make an oral presentation. Hand-deliver 

requests to speak, along with a 

computer diskette or CD in WordPerfect, 

Microsoft Word, PDF, or text (ASCII) file 

format, to the address shown at the 

beginning of this advance notice of 

proposed rulemaking between the hours 

of 9 a.m. and 4 p.m., Monday through 

Friday, except Federal holidays. They 

may be submitted by mail or e-mail to: 

Brenda.Edwards-Jones@ee.doe.gov.

Persons requesting to speak should 

briefly describe the nature of their 

interest in this rulemaking and provide 

a telephone number for contact. The 

Department requests persons selected to 

be heard to submit an advance copy of 

their statements at least two weeks 

before the public meeting. At its 

discretion, DOE may permit persons 

who cannot supply an advance copy of 

their statement to participate, if that 

person has made advance alternative 

arrangements with the Building 

Technologies Program. The request to 

give an oral presentation should ask for 

such alternative arrangements. 

C. Conduct of Public Meeting 

The Department will designate a DOE 

official to preside at the public meeting 

and may also use a professional 

facilitator to aid discussion. The 

meeting will not be a judicial or 

evidentiary-type public hearing, but 

DOE will conduct it in accordance with 

5 U.S.C. 553 and section 336 of EPCA. 

(42 U.S.C. 6306) A court reporter will be 

present to record the transcript of the 

proceedings. The Department reserves 

the right to schedule the order of 

presentations and to establish the 

procedures governing the conduct of the 

public meeting. After the public 

meeting, interested parties may submit 

further comments on the proceedings as 

well as on any aspect of the rulemaking 

until the end of the comment period. 

The public meeting will be conducted 

in an informal, conference style. The 

Department will present summaries of 

comments received before the public 

meeting, allow time for presentations by 

participants, and encourage all 

interested parties to share their views on 

issues affecting this rulemaking. Each 

participant will be allowed to make a 

prepared general statement (within time 

limits determined by DOE), before the 

discussion of specific topics. The 

Department will permit other 

participants to comment briefly on any 

general statements. 

At the end of all prepared statements 

on a topic, DOE will permit participants 

to clarify their statements briefly and 

comment on statements made by others. 

Participants should be prepared to 

answer questions by DOE and by other 

participants concerning these issues. 

Department representatives may also 

ask questions of participants concerning 

other matters relevant to the public 

meeting. The official conducting the 

public meeting will accept additional 

comments or questions from those 

attending, as time permits. The 

presiding official will announce any 

further procedural rules or modification 

of the above procedures that may be 

needed for the proper conduct of the 

public meeting. 

The Department will make the entire 

record of this rulemaking, including the 

transcript from the public meeting, 

available for inspection at the U.S. 

Department of Energy, Forrestal 

Building, Room 1J–018 (Resource Room 

of the Building Technologies Program), 

1000 Independence Avenue, SW., 

Washington, DC, (202) 586–9127, 

between 9 a.m. and 4 p.m., Monday 

through Friday, except Federal holidays. 

Any person may buy a copy of the 

transcript from the transcribing reporter.

D. Submission of Comments 

The Department will accept 

comments, data, and information 

regarding the ANOPR before or after the 

public meeting, but no later than the 

date provided at the beginning of this 

advance notice of proposed rulemaking. 

Please submit comments, data, and 

information electronically. Send them to 

the following e-mail address: 

commercialaircon 

ditioner.anopr@ee.doe.gov. Submit 

electronic comments in WordPerfect, 

Microsoft Word, PDF, or text (ASCII) file 

format and avoid the use of special 

characters or any form of encryption. 

Comments in electronic format should 

be identified by the docket number EERM/STD–01–375, and wherever 

possible carry the electronic signature of 

the author. Absent an electronic 

signature, comments submitted 

electronically must be followed and 

authenticated by submitting the signed 

original paper document. No 

telefacsimiles (faxes) will be accepted. 

Pursuant to 10 CFR 1004.11, any 

person submitting information that he 

or she believes to be confidential and 

exempt by law from public disclosure 

should submit two copies: One copy of 

the document including all the 

information believed to be confidential, 

and one copy of the document with the 

information believed to be confidential 

deleted. The Department of Energy will 

make its own determination about the 

confidential status of the information 

and treat it according to its 

determination. 

Factors of interest to the Department 

when evaluating requests to treat 

submitted information as confidential 

include: (1) A description of the items, 

(2) whether and why such items are 

customarily treated as confidential 

within the industry, (3) whether the 

information is generally known by or 

available from other sources, (4) 

whether the information has previously 

been made available to others without 

obligation concerning its 

confidentiality, (5) an explanation of the 

competitive injury to the submitting 

person which would result from public 

disclosure, (6) when such information 

might lose its confidential character due 

to the passage of time, and (7) why 

disclosure of the information would be 

contrary to the public interest. 

E. Issues on Which DOE Seeks Comment 

The Department is particularly 

interested in receiving comments 

(including data) concerning: 

1. Approaches to Analyses for Split 

Systems, Heat Pumps, and Niche 

Equipment 

The Department assumes that the 

cost/efficiency relationship for 

commercial single-package unitary airconditioning equipment in the ANOPR 

is similar to that of commercial split airconditioning systems. Is this a 

reasonable assumption for the DOE to 

make in its approach to developing the 

cost/efficiency curves? (See section 

II.C.1 of this ANOPR for details.) 

This ANOPR and the analyses 

detailed in the accompanying TSD 

address only commercial unitary air 

conditioning equipment. The 

Department proposes to address energy 

efficiency standards for commercial 

unitary heat pump equipment in a way 

that is consistent with the ASHRAE 

methodology used to set the ASHRAE/

IESNA Standard 90.1–1999 levels for 

unitary air conditioning systems with 


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heat pump heating. The Department 

requests comments on this proposed 

approach. (See section II.C.1 of this 

ANOPR for details.) 

The Department did not consider any 

niche equipment classes in the 

engineering analysis. Should the 

Department consider any niche classes 

of commercial unitary air conditioning 

equipment (e.g., portable units and 

explosion-proof/hazardous-duty units) 

that would fall under the definitions of 

either small unitary air conditioner, 

large unitary air conditioner, small 

unitary heat pump, or large unitary heat 

pump, in section I.C.3. of this ANOPR, 

apart from these general classes of 

commercial unitary air-conditioning 

equipment? 

2. Alternative Refrigerant Analysis 

The Department based its alternative 

refrigerant analysis on the use of R–410a 

refrigerant. The Department concluded 

that the incremental manufacturing cost 

and efficiency relationship derived for 

equipment using R–22 refrigerant would 

not be substantially different for 

equipment using R–410a. The 

Department requests data concerning 

the incremental cost/efficiency 

relationship associated with the use of 

R–410a in commercial unitary air 

conditioners. Also, the Department 

requests stakeholders to identify and 

provide similar information for any 

other alternative refrigerants DOE 

should consider. (See section II.C.5 of 

this ANOPR for details.) 

3. Candidate Standards Levels 

The Department has identified 

candidate energy efficiency standards 

levels ranging from 10.0 to 12.0 EER. 

The Department seeks comments on 

these efficiency standards levels and 

any other alternatives it should 

consider. (See sections III. and II.G.4 of 

this ANOPR for details.)

4. Design-Option Analysis and 

Maximum Energy Efficiency Levels 

Because there were no commercial 

unitary air conditioners that had 

efficiencies beyond 11.5 EER when the 

Department conducted its engineering 

analysis for commercial unitary air 

conditioners rated ≥65,000 Btu/h 

through <240,000 Btu/h, the Department 

had to rely on its design-option analysis 

modeling to estimate the manufacturing 

cost and efficiency relationship beyond 

11.5 EER. The Department requests 

comments from stakeholders on: (1) 

Whether the design options presented in 

the engineering analysis accurately 

estimate cost and efficiency trends 

beyond 11.5 EER, (2) whether the 

Department’s assumptions for 

evaluating a maximum technologically 

feasible design were appropriate, and (3) 

what other design options should the 

Department consider in its analysis. 

Since the Department completed its 

engineering analysis in late 2002, 

several new commercial unitary air 

conditioners, with rated efficiency 

levels greater than 12.0 EER, have 

become available on the market. The 

Department requests comments from 

stakeholders on any commercial unitary 

air-conditioning equipment with rated 

efficiency levels above 12.0 EER. (See 

sections II.C.1.a and II.C.4 of this 

ANOPR for details.) 

5. Industrial Buildings 

The Department’s analysis relies on 

simulations of electric loads in 

commercial buildings to determine the 

relative impact of the standard. The 

analysis is also intended to cover 

equipment installed in lightmanufacturing buildings. Lightmanufacturing buildings are those 

engaged in the process of making, 

assembling, altering, converting, 

fabricating, finishing, processing or 

treatment of a manufactured product 

utilizing a relatively clean and quiet 

process which does not include or 

generate significant objectionable or 

hazardous elements such as smoke, 

odor, vibration, water pollution or dust. 

As such, commercial unitary airconditioning equipment covered under 

this rulemaking could serve to provide 

space conditioning to lightmanufacturing buildings. If the electric 

load shapes and magnitudes, and in 

particular the degree of correlation 

between the hour of the peak air 

conditioning load and the hour of the 

peak building load, are substantially 

different for light-manufacturing 

buildings, a separate analysis for these 

buildings might be necessary. The 

Department seeks comments about 

whether adding light-manufacturing 

buildings to its analysis is necessary and 

what, if any, impact it would have on 

the results. (See sections II.D.1 and 

II.F.1.b.(2)(a) of this ANOPR for details.) 

6. Economizer Performance 

In its building simulation analysis, 

the Department assumed that the 

economizers operated flawlessly where 

economizer presence was indicated by 

CBECS data. This might result in some 

underestimation of the actual cooling 

loads in the buildings. Should the 

Department revise this assumption, and 

if so, what assumptions are appropriate? 

(See section II.D.1 of this ANOPR for 

details.) 

7. Fan Energy Consumption 

The Department included fan energy 

consumption as part of the total energy 

consumption of the commercial unitary 

air-conditioning equipment in the 

ANOPR analysis. This analysis includes 

fan energy consumption that occurs 

whenever the fan is in operation (i.e., 

during cooling, heating, and 

ventilation). Should the Department 

revise this approach in the NOPR 

analysis, and if so, what approach is 

appropriate? (See section II.D.1 of this 

ANOPR for details.) 

8. Equipment Markups 

For purposes of deriving customer 

prices for more efficient equipment, the 

Department differentiated between a 

baseline markup and an incremental 

markup for wholesalers, general 

contractors, and mechanical contractors. 

The incremental markup covers only 

those expenses associated with a change 

in the manufacturer price and is used to 

derive the incremental change in 

customer equipment price due to higher 

EER levels. Because the incremental 

markup covers fewer expenses, it has a 

lower value than its corresponding 

baseline markup. Nevertheless, it is 

essential to identify all expenses the 

incremental markup should cover. 

Therefore, the Department seeks 

comments on whether more or fewer 

expenses should be covered by the 

wholesale, general contractor, and 

mechanical contractor incremental 

markups. (See section II.E.2 of this 

ANOPR for details.) 

9. Hourly Based Electricity Prices 

The Department’s hourly based 

electricity price analysis uses extensive 

data to develop estimates of generation 

and coincident peak load savings due to 

the standard for each building in the 

sample. The Department enters these 

savings estimates into a customer price 

model to compute annual energy bill 

savings as an input to the LCC. The 

Department’s price model is based on 

the avoided-cost methodologies 

traditionally used to value demand 

reduction programs. Should the 

Department consider price models other 

than those based on avoided-cost 

methodologies? (See section 

II.F.1.b.(2)(b) of this ANOPR for details.)

10. Forecasts of Electricity Prices 

The Department has relied on EIA 

energy price forecasts, including the 

various EIA scenarios, to bound 

projected energy prices used in the 

standards analyses. The Department 

applied EIA’s projected trend in 

national average electricity prices to 

each customer’s marginal energy 


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45502 Federal Register / Vol. 69, No. 145 / Thursday, July 29, 2004 / Proposed Rules 

expenses. Although the Department 

believes the EIA forecasts are the most 

credible projections available, the 

Department is open to using other 

sources of credible information. Are 

there alternative electricity price 

forecasts that are credible and warrant 

consideration by the Department? (See 

section II.F.1.b.(3) of this ANOPR for 

details.) 

11. Equipment Lifetime 

The Department based its equipment 

lifetime assumption on data from the 

1999 ASHRAE HVAC Applications 

Handbook, which gives a median 

lifetime of 15 years for commercial 

unitary air conditioners. The 

Department found no other data to 

indicate a different median or mean 

lifetime for commercial unitary air 

conditioning equipment. The 

Department seeks data concerning 

whether a 15-year median lifetime is 

appropriate for commercial unitary air 

conditioners and heat pumps. (See 

section II.F.1.b.(6) of this ANOPR for 

details.) 

12. Maximum Market Share of 

Commercial Unitary Air Conditioning 

Equipment 

The shipments model uses a logit 

decision model to represent the 

probability that a new building will 

have unitary air conditioning equipment 

installed. Even if all eligible commercial 

customers decided to acquire a unitary 

air conditioner, there is still only a finite 

fraction of floor space that would 

contain the particular equipment 

covered by the standard (due, for 

example, to the climate, the building 

size or type, etc.). The Department 

estimates that the maximum fraction of 

floor space that is eligible to receive the 

unitary air conditioning equipment 

covered by the standard is about 10 

percent for each equipment category. 

The Department seeks data to determine 

whether it should revise its estimate. 

(See section II.G.3.c of this ANOPR for 

details.) 

13. Future Building Types Using 

Commercial Unitary Equipment 

Future shipments of unitary air 

conditioning equipment depend in part 

on the rate of growth of commercial 

floor space. The Department uses the 

average growth rate for all commercial 

buildings as provided by AEO. The 

shipments model should cover the 

effects of any commercial unitary air 

conditioning equipment that is 

preferentially installed in particular 

types of buildings (e.g., retail or office) 

and any growth rate of floor space for 

these building types that is substantially 

different from the average. The 

Department seeks comments concerning 

whether to base floor space growth rate 

on specific building types rather than 

the average growth rate. (See section 

II.G.3.c. of this ANOPR for details.) 

14. Customer Sub-Groups 

The Department has identified 

smaller businesses, as measured by 

annual revenue, as a possible sub-group 

in which to conduct a separate LCC 

analysis. Although the Department does 

not know the annual revenues for the 

businesses in the buildings analyzed in 

the LCC analysis, the Department hopes 

to identify a building characteristic that 

is an indicator of annual revenues. The 

Department seeks comments from 

interested parties on whether there is 

any building characteristic that 

correlates to business income. (See 

section II.H. of this ANOPR for details.) 

15. Effective Date of New Standards and 

Phaseout Date of R–22 Refrigerant 

For purposes of conducting the 

shipments and manufacturer impact 

analyses, should the Department assume 

that manufacturers will change over to 

a new refrigerant (R–410a) at the same 

time new standards levels become 

effective? (See section III. of this 

ANOPR for details.) 

16. Independent Expert Third-Party 

Reviews 

ARI and Lennox raised the following 

issues: (a) Sample of buildings, (b) 

BLAST simulation and CBECS data, (c) 

supply fan energy use while ventilating, 

and (d) incremental markups. (ARI, Nos. 

14, 17, 18, and 19; Lennox, No. 15; and 

Memo to the File: Meeting with ARI/

Lennox, March 12, 2003, No. 16) The 

Department engaged independent thirdparty experts to review the approaches, 

assumptions, data, and analytical 

methods used for the ANOPR analyses 

for these four issues. The results of these 

third-party reviews are available to 

interested parties on the Department’s 

website at http://www.eere.doe.gov/

buildings/appliance_standards/

ac_hp.html. The Department seeks 

comments about each of these issues 

and the third-party review of these 

issues. (See sections I.A.5, II.D.1 and 

II.E.2 of this ANOPR and below 

discussion for more details.) 

a. Sample of Buildings 

The Department’s economic analysis 

examined energy-use estimates in a 

sample of buildings from the EIA’s 

CBECS database. The sample represents 

a diversity of cooling loads where 

commercial unitary air conditioning 

equipment is installed in six building 

types: assembly, education, food 

services, office, retail, and warehouse 

(non-refrigerated). Because of the 

complexity of this analysis, the 

Department also obtained an 

independent third-party expert review 

to ensure that the sample of buildings 

represented the operating conditions 

associated with the population of 

commercial unitary air conditioning 

equipment with rated cooling capacities 

of ≥65,000 Btu/h to <240,000 Btu/h. The 

Department seeks comments from 

interested parties about this third-party 

review. 

b. Building Loads and System 

Thermodynamics Simulation and 

Commercial Buildings Energy 

Consumption Survey Estimates of 

Energy Use 

The Department simulated load 

shapes for each of the above-sampled 

buildings at various efficiency levels by 

using the Building Loads and System 

Thermodynamics (BLAST) software. In 

doing so, the Department found that 

cooling energy use intensity (EUI) 

predicted by BLAST is higher than the 

cooling EUI estimated by CBECS for 

buildings with commercial unitary air 

conditioning equipment, although both 

the BLAST and CBECS calculations of 

energy end uses for cooling and 

ventilation are derived from modeled 

data. In view of these findings, the 

Department used a third party to 

examine the differences between the 

BLAST simulation EUI and the CBECS 

estimated EUI. The Department seeks 

comments from interested parties about 

the third-party review of the BLAST 

simulation and CBECS estimates of 

energy use. (See section II.D.1 of this 

ANOPR for details.)

c. Supply Fan Energy Use While 

Ventilating 

The Department’s analysis examines 

the total energy impact of commercial 

unitary air conditioning equipment on 

building energy consumption and 

therefore includes both the energy use 

and savings associated with the supply 

fan during non-cooling hours. The 

Department presumes that the fan is an 

integral component of a commercial 

unitary air conditioner and operates 

continuously to provide fresh air and air 

circulation at established ASHRAE 

Standard 62–1989 air quality levels 

when the building is occupied. The 

Department seeks comments from 

interested parties about the third-party 

review of fan energy use in the 

Department’s ANOPR analysis. (See 

section II.D.1 of this ANOPR for details.) 


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d. Incremental Markups 

To determine customer prices for 

more efficient commercial unitary air 

conditioning equipment, the ANOPR 

analysis addresses both the 

manufacturer’s baseline markup and 

incremental markups for wholesalers, 

general contractors, and mechanical 

contractors. It addresses those overhead 

expenses that may vary with an increase 

in equipment efficiency for each step of 

the distribution channel, and in 

particular those overhead expenses that 

can be attributed to higher EER levels. 

The Department seeks comments from 

interested parties about the third-party 

review of incremental markups in the 

ANOPR analysis. (See section II.E.2 of 

this ANOPR for details.) 

17. Effect of Income Taxes on Life-Cycle 

Cost 

The Department did not include the 

effect of income taxes in the LCC 

analysis for this ANOPR because it 

believes the net impact of taxes on the 

LCC analysis depends upon how a 

firm’s accounting procedures expense 

the purchase cost of commercial 

equipment and measure profitability. 

The Department requests comments as 

to whether DOE should perform such an 

analysis. The Department also requests 

information from interested parties on 

the number of firms that purchase 

commercial unitary air conditioning 

equipment and actually pay taxes, and 

for those that pay taxes, how the 

purchase of such equipment is expensed 

and subsequently depreciated over time. 

(See section II.F.1 of this ANOPR for 

details.) 

18. Technologies That Affect Full- or 

Part-Load Performance 

The Department understands that 

there are other technologies that operate 

under full- or part-load conditions and 

that can improve the net annual energy 

performance of a system, but which 

generally reduce the EER of commercial 

unitary air-conditioning equipment, or, 

at best, have no effect on EER. Such 

technologies include, for example, 

multiple compressors, economizers, 

inverter-driven variable-speed fans, and 

exhaust air enthalpy recovery devices. 

The Department did not examine such 

technologies because EPCA requires the 

commercial unitary air conditioners that 

are under consideration in this 

rulemaking meet certain energy levels 

measured in terms of EER. Moreover, 

EPCA establishes minimum EER levels 

for these air-cooled commercial unitary 

air conditioners and any amended 

national standard for that equipment 

must be more stringent—in other words, 

have an increased EER. Nevertheless, 

the Department understands that partload and seasonal performance of a 

commercial unitary air conditioner is 

important because of the impact on 

national energy consumption. 

Therefore, the Department seeks 

comments and recommendations from 

interested stakeholders on how best to 

analyze the effects of those technologies 

that can reduce EER or are EER-neutral, 

and the implications both on national 

energy savings and consumer life cycle 

costs. (See section II.B of this ANOPR 

for details.) 

19. Environmental Assessment 

The Department recognizes the 

possibility that a reduction in airborne 

emissions may result from energy 

efficient commercial unitary air 

conditioners and heat pumps which, in 

turn, could result in improved health 

benefits. The Department has not 

correlated reductions in installed 

generation capacity to possible 

improvements in public health for this 

ANOPR. Nevertheless, the Department 

requests data from stakeholders which 

identify specific health benefits from 

reductions airborne emissions. (See 

section II.K of this ANOPR for details.) 

20. Rebound Effect 

As part of the building energy use and 

end-use load characterization, the 

Department did not take into account a 

rebound effect in determining the 

reduction in cooling and fan energy 

consumption due to higher EER levels. 

The rebound effect occurs when a piece 

of equipment that is made more efficient 

is used more intensively, so that the 

expected energy savings from the 

efficiency improvement do not fully 

materialize. The Department seeks 

comments on whether a rebound effect 

should be included in the determination 

of annual energy savings. If a rebound 

effect should be included, the 

Department seeks data on which to base 

the calculation of the rebound effect. 

(See section II.D.2 of this ANOPR for 

details.) 

V. Regulatory Review and Procedural 

Requirements 

This advance notice of proposed 

rulemaking was submitted for review to 

the Office of Information and Regulatory 

Affairs (OIRA) in the Office of 

Management and Budget under 

Executive Order 12866, ‘‘Regulatory 

Planning and Review,’’ 58 FR 51735 

(October 4, 1993). If DOE later proposes 

amended energy conservation standards 

for certain air-cooled, electrically 

operated, unitary central air 

conditioners and heat pumps for 

commercial applications, the 

rulemaking would likely constitute a 

significant regulatory action, and DOE 

would prepare and submit to OIRA for 

review the assessment of costs and 

benefits required by section 6(a)(3) of 

the Executive Order. In addition, 

various other analyses and procedures 

may apply to such future rulemaking 

action, including those required by the 

National Environmental Policy Act, 42 

U.S.C. 4321 et seq.; the Unfunded 

Mandates Act of 1995, Public Law 104–

4; the Paperwork Reduction Act, 44 

U.S.C. 3501 et seq.; the Regulatory 

Flexibility Act, 5 U.S.C. 601 et seq.; and 

certain other Executive Orders. 

VI. Approval of the Office of the 

Secretary 

The Secretary of Energy has approved 

publication of today’s Advance Notice 

of Proposed Rulemaking.

Issued in Washington, DC, on July 13, 

2004. 

David K. Garman, 

Assistant Secretary, Energy Efficiency and 

Renewable Energy.

[FR Doc. 04–16575 Filed 7–28–04; 8:45 am] 

BILLING CODE 6450–01–U


EE-RM-STD-01-375 COMMENT 25D