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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 interested in receiving comments on all aspects of this ANOPR. DOE especially invites comments or data to improve the Departments' analysis, including data or information that will respond to the following questions or concerns that were addressed in this ANOPR: 1. Definition and Coverage The Department seeks to clarify coverage under this proposed activity. This ANOPR proposes a definition that more closely parallels NEMA's TP 1, outlining a broad scope of coverage and then identifying exemptions. The Department invites stakeholders to comment on the new distribution transformer definition, including the revised scope, the exemptions list, and the exemptions list definitions (see section II.A for details).



### 2. Product Classes The Department proposes product classes that are in keeping with those in NEMA's TP 1-2002 document, specifically by breaking down the population of distribution transformers by type of insulation (liquid-immersed or dry-type), number of phases (single or three), voltage (low or medium), and BIL rating (for medium-voltage dry-types). The Department is proposing a greater degree of specificity by BIL rating than that provided in NEMA's TP 1-2002 document. The Department requests feedback from stakeholders on its BILclassification system for mediumvoltage, dry-type transformers (see section II.A for details). 3. Engineering Analysis Inputs In Chapter 5 of the TSD, the Department presents all the costs of material used as design inputs to the modeling software. The Department asks that stakeholders, particularly manufacturers, review the material prices and comment on whether they represent reasonable input costs for the engineering analysis. 

### 4. Design Option Combinations For each representative unit analyzed, the Department selected several methods of construction, by varying core steels and winding material. These combinations represent the most common types of transformers made, as well as the lowest first-cost and the maximum technologically feasible design. The complete breakdown of the design option combinations is presented in Chapter 5 of the TSD. The Department requests that stakeholders review these design option combinations and comment on whether they are the best ones to use for a given representative unit. Also, the Department requests comments on the screening analysis, regarding both technologies and materials that were included and those screened out from further consideration. (See section II.B for details.) 5. The 0.75 Scaling Rule The Department applied a 0.75 power law scaling rule to two key components of the transformer efficiency analysis: (a) In simplifying the engineering analysis by taking 115 different kVA ratings and turning them into 13 engineering design lines with 13 representative units, the Department committed to using the 0.75 scaling rule to scale losses from the representative unit to other kVA ratings within a design line. The Department requests comments on this practice, discussed in section II.C.2 and outlined in Chapter 5 of the TSD. (b) To simplify the economic analysis, the Department extrapolated economic costs and benefits for a particular design line to each of the kVA ratings using the 0.75 rule. Not all economic costs and benefits of transformer efficiency scale according to the 0.75 rule, although the rule may be a reasonable approximation for ranges of kVA ratings. The Department requests comment on the desirability of having a simple scaling for transformer efficiency economics versus using more detailed scaling methods that may result in a more complicated relationship between kVA rating and efficiency level. 6. Modeling of Transformer Load Profiles Lacking sufficient empirical transformer loading data, the Department developed models of transformer loads specific to each type of transformer. The Department requests comments on the methods it employed as well as sources of specific loading data that it could use in the NOPR analyses. (See section II.F for details.) 7. Distribution Chain Markups The Department used cost data from RS Means combined with manufacturer price estimates and U.S. economic census data to estimate markups and installation costs for transformers from the factory door through completed installation. The Department requests stakeholder feedback on markup factors, methods, and data used by the Department. (See section II.E for details.)

8. Discount Rate Selection and Use The Department used a weighted average cost of capital as the discount rate for the LCC and the OMB-mandated discounted rates for the NPV calculation. The Department requests stakeholder feedback on the appropriateness of these discount rates. (See sections ILF and II.H for details.) 9. Baseline Determination Through Purchase Evaluation Formulae The Department characterized currentmarket conditions for both liquidimmersed and dry-type transformers using a distribution of load and no-load loss values, and assumed percentages of customers that evaluate their transformer purchases by considering the value of load and no-load losses. The Department invites further comment on the purchase decision model and transformer evaluation behavior for both liquid-immersed and dry-type transformers, especially: • Actual A and B values used in the current market,• Actual efficiency of the low firstcost designs currently on the market since the efficiency of the low first-cost designs has a large impact on overall energy savings estimates, • Applicability of the approach tocharacterize both medium- and lowvoltage, dry-type transformer market behavior, and • The stability over time of the transformer market, especially the percent of evaluators and levels of A and B values. 

### (See section II.F for details.) 10. Electricity Prices The Department requests stakeholder feedback on the two methods it used for this rulemaking to determine the cost of electricity consumed by transformers. For dry-type transformers used predominately by commercial and industrial firms, the Department calculated estimated bills based on asample of electricity tariffs. For liquidimmersed transformers, the Department used market and FERC Form 714 data to estimate the marginal cost of electricity to utilities. (See section II.F for details.)

11. Load Growth Over Time Since the Department lacks specific information on transformer load growth over time, it assumed for its default ANOPR scenario a 1-percent annual growth rate for liquid-immersedFederal Register /Vol. 69, No. 145 /Thursday, July 29, 2004 /Proposed Rules

transformers and zero-percent load growth for dry-type transformers. The Department requests stakeholders comments on these assumptions. (See section II.F for details.) 12. Life-Cycle Cost Sub-Groups The Department has identified various categories of utilities, such as municipal utilities and rural electric cooperatives, as possible sub-groups for which to conduct a separate LCC analysis. The Department seeks stakeholder feedback regarding the most appropriate sub-groups to include in the NOPR analysis. (See section 11.1 for details.) 13. Utility Deregulation Impacts The Department is aware of ongoing wholesale and retail deregulation activities in the electric utility industry, but is uncertain how this deregulation will affect transformer purchase decisions in the long term. The Department requests comments from stakeholders with specific information regarding the impact of deregulation. Utility deregulation will likely have the most significant impacts on LCC results, through changes in electricity prices. LCC Details are found in TSD Chapter 8.

V. Regulatory Review and Procedural Requirements

This advance notice of proposed rulemaking was submitted for review to OIRA in the Office of Management and Budget under Executive Order 12866, "Regulatory Planning and Review." 58 FR 51735. If DOE later proposes energy conservation standards for certain distribution transformers, 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 

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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, Pub. L. 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 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. 04-16573 Filed 7-28-04; 8:45 am]

BILLING CODE 6450-01-P