Small Electric Motors

Energy Conservation Standards

Preliminary Analyses

Public Meeting

Building Technologies Program

Office of Energy Efficiency and Renewable Energy

U.S. Department of Energy

January 30, 2009

http://www1.eere.energy.gov/buildings/appliance_standards/commercial/small_elec

EERE-2007-BT-STD-0007 COMMENT 08.3
Welcome

• Introductions• Role of the Facilitator• Ground Rules (norms)

­ Listen as an ally­ Use short, succinct statements/keep to the point­ Hold sidebar conversations outside the room­ One person speaks at a time (raise hand to be recognized

name for the record)

­ Set cell phones to silent/vibrate

• Housekeeping Items• Agenda Review• Opening Remarks

EERE-2007-BT-STD-0007 COMMENT 08.3
9:00 – 9:20 am

9:20 – 9:30 am9:30 – 10:15 am10:15 – 10:30 am

10:30 – 11:15 am11:15 – 12:00 pm12:00 – 1:00 pm1:00 – 1:30 pm

1:30 – 2:00 pm2:00 – 2:30 pm3:00 – 3:30 pm3:30 pm

Agenda

Welcome, Introductions, Opening Statement

Statute and Context

Market & Tech; Screening AnalysisBreak

Engineering Analysis

Energy Use & End­Use Load; Markup Analys

LunchLife­Cycle Cost And Payback Period Analysi

National Impact Analysis

Preliminary MIA and other NOPR Analyses

Final Questions / DiscussionClosing Remarks and Adjourn

EERE-2007-BT-STD-0007 COMMENT 08.3
Purpose of the Public Meeting

• Review statute and DOE actions for small electric motors

• Present DOE’s preliminary analysis

• Clarify any questions about DOE’s approach

• Seek comment from participants on the analysis to date• Discuss next steps for the rulemaking

EERE-2007-BT-STD-0007 COMMENT 08.3
Issues for Comment

Issue Box DOE welcomes comments, data, and information

concerning its preliminary analysis on small electric motors.

Throughout this presentation, issues that correspond to issues 

in DOE’s published material from this preliminary analysis are 

for discussion in boxes like this one. Nonetheless, comments 

welcome on any part of DOE’s analysis.

EERE-2007-BT-STD-0007 COMMENT 08.3
2

34

Background and Legal Authority

5

Public Meeting Agenda

2 Market & Tech; Screening; Engineering3 Energy Use; Markup Analysis

41 Statute and Context5

Life­Cycle Cost and Payback Period Analysis

National Impact Analysis

6 Preliminary MIA; NOPR Analyses

EERE-2007-BT-STD-0007 COMMENT 08.3
Statu

Small Electric Motors

• The Energy Policy Act of 1992 amended the Energy Policy and Co

Act to direct DOE to prescribe energy conservation standards for 

small electric motors for which the Secretary determines that stan

‘‘would be technologically feasible and economically justified, an

result in significant energy savings.’’ (42 U.S.C. 6317(b)(1)).

• DOE conducted analysis and published a positive determination o

2006. 71 FR 38799.

• DOE initiated its energy conservation standards rulemaking by pu

framework document soliciting comment on its methodology on A

2007. 72 FR 44990.

• DOE is conducting a separate rulemaking to establish test proced

small electric motors.

• NOPR published on December 22, 2008. 73 FR 78220.• Comment period is open until March 9, 2009.

EERE-2007-BT-STD-0007 COMMENT 08.3
Statu

Stakeholder Participation in the Rulemaking P

Federal Register

notices

Framework

Document

Preliminary

Analysis NOPR Final Rule

• Public meetings and oral comments• Written comments on Federal Register notices, Technica

Support Documents and Analytical Spreadsheets

• Data input from manufacturers and other interested parti

Stakeholder

participation

Today

EERE-2007-BT-STD-0007 COMMENT 08.3
ANOPR NOPR Final Rule

Statu

Preliminary Analysis Rulemaking Stage

Framework

Document NOPR Preliminary Analysis Final Rule

Market &

Technology

ScreeningAnalysis

EngineeringAnalysis

Energy Use &End Use LoadCharacterization

ShipmentsAnalysis

Markups for

EquipmentPrice

Determination

Life­Cycle

Cost andPayback

Period Analysis

Preliminary

Manufacturer

ImpactAnalysis

EERE-2007-BT-STD-0007 COMMENT 08.3
ANOPR NOPR Final Rule

Statu

Analyses for Notice of Proposed Rulemaking 

Framework

Document

EnvironmentalAssessment

Life­Cycle

CostSubgroupAnalysis

Manufacturer

ImpactAnalysis

Utility

ImpactAnalysis

EmploymentImpactAnalysis

Revise

Preliminary

Analysis

NOPR Preliminary Analyses Final Rule

EERE-2007-BT-STD-0007 COMMENT 08.3
ANOPR NOPR Final Rule

Statu

Analyses for Final Rule

Framework

Document NOPR Preliminary Analyses

FinalReview

Revise

NOPR

Analyses

Final

Rule

EERE-2007-BT-STD-0007 COMMENT 08.3
Framework Document NOPM and Prelim. TSD NOPRFinal Rule 

Statu

Small Electric Motors Rulemaking Sched

Issue Final Rule Febru

Effective Date (5 years minimum, 42 USC 6317(b)(3)) Febru

Milestone Date

Issue NOPR ~J

December 

Federal Register Notice of Public Meeting and Availability of the Preliminary Technical Support Document

Framework Document Published August 

2007 2008 2009 2010 2011 2012 2013 2014 

EERE-2007-BT-STD-0007 COMMENT 08.3
2

34

Background and Legal Authority

5

Public Meeting Agenda

2 Market & Tech; Screening; Engineering3 Energy Use; Markup Analysis

41 Statute and Context5

Life­Cycle Cost and Payback Period Analysis

National Impact Analysis

6 Preliminary MIA; NOPR Analyses

EERE-2007-BT-STD-0007 COMMENT 08.3
Framework

Document

Preliminary

Analysis

NOPR Final Rule

Market &

Technology

ScreeningAnalysis

EngineeringAnalysis

Energy Use &End Use LoadCharacterization

ShipmentsAnalysis

Markups for

EquipmentPrice

Determination

Life­Cycle

Cost andPayback

Period Analysis

Preliminary

Manufacturer

ImpactAnalysis

EERE-2007-BT-STD-0007 COMMENT 08.3
Market and Technolo

Market Assessment

Purpose

• Characterize the small electric motors market and manufa• Determine appropriate equipment classes

Method

• Clarify scope of coverage based on NEMA MG1­1987• Identify and characterize manufacturers of small electric m• Classify covered products into appropriate equipment clas• Use historical NEMA shipment data provided for the Dete

Analysis, estimate current sales

EERE-2007-BT-STD-0007 COMMENT 08.3
Market and Technolo

Scope of Coverage

• Statutory Definition of Small Electric Motor

• “a NEMA [National Electrical Manufacturers Association] g

purpose alternating­current single­speed induction motor, 

two­digit frame number series in accordance with NEMA S

Publication MG1–1987. ” (42 U.S.C. 6311(13)(G))

• In order to more clearly understand scope, DOE sought to 

the following terms in this definition:

• “general­purpose alternating­current”• “induction motor”• “two­digit frame number series”

EERE-2007-BT-STD-0007 COMMENT 08.3
Market and Technolo

Scope of Coverage

• “General­purpose alternating­current”

• a NEMA term used in MG1­1987 for alternating­current mo

are not designed with a specific application in mind.

• Paragraph MG1–1.05 defines this term as:

– A general­purpose alternating­current motor is an induction m

200 horsepower and less, which incorporates all of the follow

(1) open construction,

(2) rated continuous duty,

(3) service factor in accordance with MG1­12.47, and

(4) Class A insulation system with a temperature rise as spec

MG1­12.42 for small motors or Class B insulation system with 

temperature rise as specified in MG1­12.43 for medium moto

designed in standard ratings with standard operating characte

mechanical construction for use under usual service conditionrestriction to a particular application or type of application.

EERE-2007-BT-STD-0007 COMMENT 08.3
Market and Technolo

Scope of Coverage

• “induction motor”

• Converts electrical power into rotational mechanical power 

electromagnetic induction for its operation and has one or 

component members capable of rotary movement.

• Statute requires that small electric motors are built in accor

with NEMA MG1­1987, which has five categories of induct

split­phase, shaded­pole, capacitor­start (both CSIR and 

permanent­split capacitor (PSC), and polyphase motors.

• DOE comes to a preliminary conclusion that the CSIR, CS

polyphase motors are the only categories that meet the sta

requirements.

– Split­phase motors are designed for specific purposes and ap

DOE is unaware of any general­purpose split­phase motors.

– Shaded­pole and PSC motors fail to meet the torque requirem

general­purpose motors, under NEMA MG1–1987 (MG1­12.3

EERE-2007-BT-STD-0007 COMMENT 08.3
Market and Technolo

Scope of Coverage

• “two­digit frame number series”

• A motor’s standard system of numbers in combination with 

designating the size and mounting dimensions of a motor.

• For small electric motors, it is the “D” dimension in inches m

by 16.

• The “D” dimension is measured from the centerline of the s

bottom of the mounting feet.

• For example, a 48 frame motor would have a “D” dimensio

inches (16 x 3.00 = 48). Standard dimensions enable ease 

replacement.

• Covered motors are 42, 48 and 56 frame motors

– MG1­1987 only gives standard dimensions for these three fra

– Other two­digit sizes, e.g., 66 frame, are likely to be definite­p

special­purpose and are not used in general­purpose applicat

EERE-2007-BT-STD-0007 COMMENT 08.3
Market and Technolo

Request for Comment:

Coverage of Small Electric Motors

Issue: The scope of small electric motors covered under the 

rulemaking activity is slightly narrower than that considered fo

determination analysis. In the determination analysis, coverag

small electric motors was interpreted to mean open and enclo

construction. DOE now understands the statutory definition of 

electric motor” as being applicable only to motors with open

construction. DOE invites interested parties to comment on its

understanding of coverage for the preliminary analyses. In pa

DOE requests specific legal bases and detailed supporting ev

for an alternative viewpoint. Please refer to section 2.2.1 of ch

of the preliminary TSD.

EERE-2007-BT-STD-0007 COMMENT 08.3
Market and Technolo

Manufacturers of Small Electric Motors

• Four manufacturers account for more than 90% of the dom

market share of all categories of covered equipment.

• A.O. Smith Electrical Products Company• Baldor Electric Company• Emerson Motor Technologies• Regal Beloit Corporation

• All are members of NEMA• All have diverse portfolios of products, including many oth

categories of electric motors, other related electrical equip

and switchgear.

EERE-2007-BT-STD-0007 COMMENT 08.3
Market and Technolo

Equipment Classes

• DOE divides covered equipment into classes by

• (1) the type of energy used;• (2) the capacity of the equipment; and• (3) any other performance­related features that require diff

standard levels, such as features affecting consumer utility

(42 USC 6295(q))

• Different energy conservation standards may apply to diffe

equipment classes

• DOE determined that it would classify:

• CSIR, CSCR, and polyphase small electric motors separat• Horsepower ­ rated power capacity of the motor, has a dire

on small motor efficiency

• Number of poles ­ impacts the both the rated speed and to

characteristics of the motor

• 72 equipment classes – each a unique combination of hors

number of poles, and motor category

EERE-2007-BT-STD-0007 COMMENT 08.3
Market and Technolo

Equipment Classes

• Proposed table of equipment classes• One table like this for each motor type – polyphase, CSIR, 

EERE-2007-BT-STD-0007 COMMENT 08.3
Market and Technolo

Small Electric Motors Unit Shipments

• Methodology:

• Shipment estimates were prepared using the shipment dat

had provided to DOE for the determination analysis in 2006

• DOE used publicly available shipment data from the U.S. C

Bureau to calculate an annual growth rate and project the N

data to a shipment estimate for 2007.

• As discussed earlier, DOE only projected open constructio

• Approximately 6,286,000 covered small electric moto

shipped in 2007.

• Polyphase – approximately 557,000 or 8.9%• CSIR – approximately 5,443,000 or 86.6%• CSCR – approximately 286,000 or 4.5%

EERE-2007-BT-STD-0007 COMMENT 08.3
Market and Technolo

Technology Assessment

• Purpose: to develop a preliminary list of technology option

could improve the efficiency of small electric motors.

• Method: DOE identified technology options from:

• Literature review, including manufacturer marketing brochu• Determination analysis rulemaking technical reports• Comments and input from stakeholders, including DOE tech

contractors

• DOE classified losses into four different groups:

• conductor losses (I2R)• core losses• friction and windage losses• stray­load losses

• DOE did not identify any technology options that reduce st

losses.

EERE-2007-BT-STD-0007 COMMENT 08.3
Market and Technolo

Technology Options

• Conductor losses (I2R) ­ measures DOE considered to redu

• using copper die­cast rotor cages• removing skew on the conductor cage• increasing the cross­sectional area of the rotor conductor b• increasing the end­ring size• changing gauges of copper wire in the stator• manipulating slot size geometry• decreasing the air gap between the rotor and stator

EERE-2007-BT-STD-0007 COMMENT 08.3
Market and Technolo

Technology Options

• Core losses – measures DOE considered to reduce:

• adding stack length to the motor;• changing grades of electrical steel (i.e., improved conventio

and exotic steel types)

• annealing laminations• thinning laminations• using plastic bonded iron powder (PBIP) as a core material• using a permanent magnet electric motor

EERE-2007-BT-STD-0007 COMMENT 08.3
Market and Technolo

Technology Options

• Friction and Windage losses – measures DOE considered t

• improving mechanical components and design (e.g., bearin

bearing lubricant)

• improving the efficiency of the cooling system

EERE-2007-BT-STD-0007 COMMENT 08.3
Market and Technolo

Technology Options

• DOE received comment that improving efficiency can impact the

performance / operation of an electric motor. DOE therefore kept tfollowing motor characteristics in mind:

• rotor forces and stresses• bar shapes and fits• aluminum versus copper cages and other alloys• rotor skew and air gap• the cooling circuit• length to diameter ratios• speed torque characteristics and slip• end ring forces• unbalanced magnetic forces and noise• application requirements• stator core design factors• winding elements• stator and frame construction• rotor design and construction

EERE-2007-BT-STD-0007 COMMENT 08.3
Market and Technolo

Request for Comment:

Technology Options for Small Electric Moto

Issue: DOE invites comments on the list of technology option

developed in the technology assessment. DOE invites comm

the completeness and description of these technology options

Please refer to section 2.2.3 of chapter 2 of the preliminary TS

EERE-2007-BT-STD-0007 COMMENT 08.3
Scr

Screening Analysis

• Purpose

• To apply screening criteria to determine which technology 

to evaluate and which to screen out

• Technology options are screened using the following crite

• Technological feasibility• Practicability to manufacture, install, and service• Adverse impacts on product utility or availability to custom• Adverse impacts on health or safety

(10 CFR Part 430, subpart C, appendix A at 4(a)(4) and 5(b))

EERE-2007-BT-STD-0007 COMMENT 08.3
Scr

Technology Options Screened Out

• Three technology options were screened out:

• radial air gaps less than 10 thousandths of an inch• plastic bonded iron powder• permanent magnet electric motors

• The screening of these options are discussed on the follow

slides

• Preliminary TSD Chapter 4 provides detail on the screening

analysis.

EERE-2007-BT-STD-0007 COMMENT 08.3
Scr

Screened Out: Radial Air Gap <10 Thousan

• Reducing the radial air gap between rotor and stator impro

efficiency, but at some point exceeds practicability to man

• DOE screened out radial air gaps below ten thousandths o

because it is not “practicable to manufacture, install, and s

• Problems in manufacturing and service, because the rotor c

come into contact with the stator

• Also screened out due to adverse impacts on consumer ut

reliability

• May experience higher failure rates when manufactured wit

are less than ten thousandths of an inch, particularly for mo

taller and heavier rotors.

EERE-2007-BT-STD-0007 COMMENT 08.3
Scr

Screened Out: Plastic Bonded Iron Powd

• An iron powder alloy suspended in plastic and shaped into 

components, eliminating a number of manufacturing steps

researchers claim this technology option could cut core lo

as much as 50 percent.

• DOE screened out PBIP because it has never been incorpo

a working prototype of a small electric motor

• DOE is uncertain whether the material has the structural int

be formed into a small electric motor

• DOE is also uncertain whether PBIP would be practical to

manufacture, install, and service

• Insufficient information available on the ability to manufactu

technology

EERE-2007-BT-STD-0007 COMMENT 08.3
Scr

Screened Out: Permanent Magnet Electric M

• A rotating machine whose stator has surface­mounted per

magnets, thus the air gap magnetic field is produced by pe

magnets.

• DOE screened out permanent magnet electric motors beca

motors cannot be manufactured as small electric motors, a

in EPCA.

• Necessary controls to start and operate the motor may mak

impractical to install the electric motor in certain equipment

EERE-2007-BT-STD-0007 COMMENT 08.3
Scr

Technology Options Selected for Further Cons

• Use a copper die­cast rotor cage

• Remove skew on conductor cage

• Increase cross­sectional area of the rotor conductor bars

• Increase end ring size• Manipulate stator slot size

• Decrease the air gap between rotor and stator (no less than

10 thousandths of an inch)

• Use improved grades of electrical steel

• Use thinner steel laminations

• Anneal steel laminations

• Add stack height (i.e. more electrical steel)

• Use high­efficiency lamination materials

• Install better bearings and lubricant• Install a more efficient cooling system

EERE-2007-BT-STD-0007 COMMENT 08.3
Scr

Request for Comment:

Screened Out Technologies

Issue: DOE invites comments on the three technology option

were screened out of the analysis—radial air gaps below ten

thousandths of an inch, plastic bonded iron powder, and perm

magnet electric motors. Please refer to section 2.3 of chapter 

preliminary TSD.

EERE-2007-BT-STD-0007 COMMENT 08.3
Engin

Purpose of the Engineering Analysis

• To evaluate design options that improve efficiency relative to th

units

• To characterize manufacturer selling price versus nominal full­

efficiency relationship for higher efficiency small electric motors

Downstream Ana

• Life­Cycle Cost an

Payback Period

• National Impact A

Manufacturer Selling Price –

Efficiency Relationship

Manufacturer

Selling Price

Nominal Full­load Efficiency

EERE-2007-BT-STD-0007 COMMENT 08.3
Engin

Selecting Representative Units to Analy

• Selecting the representative motors to analyze

• Reviewed the small electric motor determination analysis• Reviewed manufacturers' sales catalogs• Considered three variables:

– motor categories (three categories)

– horsepower rating (eight rating categories)

– number of poles (three configurations)

• Motor Categories ­ ensure each motor category was repres

CSIR, CSCR, and polyphase.

• Horsepower ­ ratings commonly available in several manu

catalogs and scalable to other equipment classes.

• Number of poles ­ selected four­pole motors because 1) hi

2007 shipment volume and 2) falls between 2 and 6 poles, 

any error from scaling from 4 to 2 and 6 poles.

EERE-2007-BT-STD-0007 COMMENT 08.3
Engin

Engineering Analysis Representative Un

• DOE selected four motors from three equipment

classes for its analysis:

• Polyphase, 1 hp, 4 pole, 56 frame motor• Capacitor­start, induction­run, 1⁄2 hp,

4 pole, 56 frame motor

• Capacitor­start, induction­run, 1⁄2 hp,

4 pole, 48 frame motor

• Capacitor­start, capacitor­run, 3⁄4 hp,

4 pole, 56 frame motor

• Two­Pronged Approach

• Efficiency curves for each motor listed above using

a subcontractor’s proprietary design software.

• Software outputs bill of materials, coupled with

labor estimates and mark­ups to arrive at a

manufacturer’s selling price.

EERE-2007-BT-STD-0007 COMMENT 08.3
Engin

Develop

Baseline

Validate

Manufacturer

Data

Design

Restrictions

Implement

Design Options

Markup

Production

Cost

Engineering Analysis Methodology

• Defined baseline specifications for each equip

analyzed.

• Design criteria set to ensure that the resulting 

would be both reasonable and manufacturable

• Design option combinations ordered from sho

to longest payback.

• Bill of materials, labor estimates and estimated

manufacturer mark­ups to convert production 

selling price (MSP).

• Curves and slopes compared with data provide

manufacturers under confidentiality agreemen

EERE-2007-BT-STD-0007 COMMENT 08.3
Engin

Small Electric Motor Design Analysis – Manufac

(1 of 3)

• Peak slot fill – the maximum value this parameter should reach 

percent for an assumed high volume simultaneous insertion pro

(Note: DOE considers “slot fill” to be the area of the wire (includ

insulation) divided by the total slot area available for winding.)

• Air gap between rotor and stator – the air gap between the rotor 

should not be less than 0.010 inches. Having air gaps tighter tha

minimum could be problematic and may cause contact between spinning rotor and the stator, especially as shaft length increase

• Stator slot opening – the opening in combination with the coppe

gauges used should graph to a point in the “Level Wind Area” o

Gap Chart” taken from Alliance Winding. Without this restriction

concerned there may be too many issues with wire breakage an

of manufacturers’ winding tools.

EERE-2007-BT-STD-0007 COMMENT 08.3
Engin

Small Electric Motor Design Analysis – Manufac

(2 of 3)

• Stack height – the stack height (or length) may change by up to 

relative to the baseline height (i.e., the stack height may double 

value). This design option enables motors to regain induction wh

grades are improved.

• Locked rotor torque – the torque must be kept within 10 percent 

baseline motor, and be within the specifications set forth by NEM

1987 in Section 12.32.2. (e.g., for a 0.5 hp, four­pole motor the m

85 oz­ft., [7.2 Newton meters]). Maintaining the locked rotor torq

percent of the baseline motor will help preserve the utility of the 

efficient motor designs.

• Locked rotor current – the current should not exceed the values 

MG 1­1987 Section 12.33.2 (Design N) (e.g., 45 amperes for a 1

hp motor).

EERE-2007-BT-STD-0007 COMMENT 08.3
Engin

Small Electric Motor Design Analysis – Manufac

(3 of 3)

• Breakdown torque – the breakdown torque must fall within NEM

1987 Table 10­5 limits for all ratings (e.g., for 0.5 hp, four­pole s

motor greater than 40.5 oz­ft, but not to exceed 58.0 oz­ft [3.43

Newton meters]).

• Cooling system – the parameters directly related to the motor’s 

system, such as ventilation openings in the laminations, should 

modified in a manner that will increase the operating temperatu

motor.

• Rotor skew – the rotor skew may be altered, but it cannot be ra

lowered to a point that will introduce harmonics that adversely a

performance or introduce cusps in the acceleration curve. (Not

design limitation relies on the expertise of the motor designer).

EERE-2007-BT-STD-0007 COMMENT 08.3
­

Engin

Cost Model Inputs

• Full production costs

• Material and component costs derived from a Bill of Materials gen

third­party design software and input from industry experts

• Labor costs estimated, based on industry experts

• Direct material• Direct labor• Factory overhead• Depreciation

Full

Production

Cost

+

Manufacturer

Markups

(Non Production Costs)

=

• Sales & marketing• Research & development• Interest• Profit

Manufac

Selling P

EERE-2007-BT-STD-0007 COMMENT 08.3
Engin

Cost Model Inputs ­ Material

• Bill of materials is calculated from three types of material costs:

fixed costs, variable costs and semi­fixed costs.

• Fixed cost materials are those parts and components that are con

all designs and do not vary with efficiency, e.g., switches or ball­b

• Variable costs are those based on the cost of the material and the 

that material used in the design. E.g., stator and rotor lamination c

variable because the material price for the different steel grades c

does the volume of steel needed in each design.

• Semi­fixed costs are those with a constant price per pound, which 

from design to design as a function of the amount used in the mot

E.g., die­cast aluminum or copper used in the rotor bars. The pric

for aluminum or copper is the same from design to design; howev

per design is different because the amount varies with each desig

EERE-2007-BT-STD-0007 COMMENT 08.3
Cost Model Inputs ­ Material

Steel $/lb

M36 24 gage 0.65

M36 29 gage 0.70

M19 24 gage 0.75

M19 29 gage 0.80

M15 29 gage 0.90

Metal $/lb

Copper 3.49

Aluminum 1.11

Wire Gauge $/

19 3.

19.5 3.

20 3.

20.5 3.

21 3.

21.5 3.

22 3.

22.5 3.

23 3.

• Steel costs, metal costs, and copper wire gauge cost

as inputs to the engineering analysis

• Prices were estimated after conversations with indus

experts and DOE technical consultants, as well as

comments received at framework public meeting

EERE-2007-BT-STD-0007 COMMENT 08.3
Engin

Cost Model Inputs ­ Labor

EERE-2007-BT-STD-0007 COMMENT 08.3
­

Engin

Cost Model Markups

• DOE developed manufacturer markups

• Scrap factor: 2.5% – handling of material in the factory an

material that cannot be used (i.e., short wire lengths)

• Factory overhead: 12.5% – indirect costs associated with 

indirect materials, energy use, taxes & insurance.

• Non­production: 37% – sales and general administrative c

interest payments and profit.

• Direct material• Direct labor• Factory overhead• Depreciation

Full

Production

Cost

+

Manufacturer

Markups

(Non Production Costs)

= Manufac

Selling P

• Sales & marketing• Research & development• Interest• Profit

EERE-2007-BT-STD-0007 COMMENT 08.3
Engin

Results for Polyphase, 1 hp, 4 Pole, 56 Frame M

Manufacturer Selling Price ($)

$2,000

$1,800

$1,600

$1,400

$1,200

$1,000

$800

$600

$400

$200

$0

90.4 1,785.4986.7 221.35

85.5 131.5581.5 105.23

75.8 93.46

Manufacturer

Selling Price ($)

Efficiency (%)

74.0 76.0 78.0 80.0 82.0 84.0 86.0 88.0 90.0 

Full Load Efficiency (%)

EERE-2007-BT-STD-0007 COMMENT 08.3
Engin

Results for Polyphase, 1 hp, 4 Pole, 56 Frame M

EERE-2007-BT-STD-0007 COMMENT 08.3
Engin

Results for Capacitor­start, Induction­Run, 1⁄2 

4 Pole, 56 Frame Motor

$1,800

Manufacturer Selling Price ($)

$1,600$1,400$1,200$1,000

$800$600$400$200

79.3 1,532.9479.3 213.8275.2 136.51

68.7 112.8663.3 105.61

Manufacturer Selling

Price ($)

Efficiency (%)

$0

62.0 64.0 66.0 68.0 70.0 72.0 74.0 76.0 78.0 

Full Load Efficiency (%)

EERE-2007-BT-STD-0007 COMMENT 08.3
Engin

Results for CSIR, 1⁄2 hp, 4 Pole, 56 Frame Mo

EERE-2007-BT-STD-0007 COMMENT 08.3
Engin

Results for Capacitor­Start, Induction­Run, 1⁄2 

4 Pole, 48 Frame Motor

$1,800

Manufacturer Selling Price ($)

$1,600

$1,400

$1,200

$1,000

$800$600$400$200

82.0 1,547.1181.7 212.4074.1 120.00

69.5 105.7962.3 96.97

Manufacturer

Selling Price ($)

Efficiency (%)

$0

60.0 62.0 64.0 66.0 68.0 70.0 72.0 74.0 76.0 78.0 80.0 8

Full Load Efficiency (%)

EERE-2007-BT-STD-0007 COMMENT 08.3
Engin

Results for CSIR, 1⁄2 hp, 4 Pole, 48 Frame Mo

EERE-2007-BT-STD-0007 COMMENT 08.3
Engin

Manufacturer Selling Price ($)

Results for Capacitor­Start, Capacitor­Run, 3⁄4 

4 Pole, 56 Frame Motor

$2,200

$2,000

$1,800

$1,600

$1,400

$1,200

$1,000

$800

$600

$400

$200

$0

88.3 2,024.82

87.0 259.7882.9 149.50

77.1 124.3368.6 116.17

Manufacturer

Selling Price ($)

Efficiency (%)

66.0 68.0 70.0 72.0 74.0 76.0 78.0 80.0 82.0 84.0 86.0 8

Full Load Efficiency (%)

EERE-2007-BT-STD-0007 COMMENT 08.3
Engin

Results for CSCR, 3⁄4 hp, 4 Pole, 56 Frame Mo

EERE-2007-BT-STD-0007 COMMENT 08.3
Engin

More Information on the Engineering Ana

• TSD Chapter 5

• Detail on baseline motors analyzed• Detail on methodology followed for the engineering analysis• Detail on the cost model, including material prices and assumed h

loaded labor rate

• Results of the engineering analysis, including performance charac

• TSD Appendix 5A

• Design information on one electric motor design from each of the 

representative equipment classes analyzed in the engineering ana

EERE-2007-BT-STD-0007 COMMENT 08.3
Engin

Issues for Discussion

Issue: DOE invites comments on the methodology followed f

preliminary TSD, namely use of engineering software to desig

efficient versions of the four representative units analyzed. D

also interested in comment on the baseline models selected, 

whether these are the appropriate baseline models on which t

base the engineering analysis. Finally, DOE is also interested 

comments on the estimated manufacturer markups and labor 

that enable the conversion of input costs to selling prices. Ple

refer to section 2.4 of chapter 2 of the preliminary TSD.

Issue: DOE invites comments on the findings of the enginee

analysis. DOE also invites comment on the decision to drop o

the four motors from the preliminary TSD analysis due to the s

findings between the 48­ and 56­frame size CSIR motors.

EERE-2007-BT-STD-0007 COMMENT 08.3
2

34

Background and Legal Authority

5

Public Meeting Agenda

2 Market & Tech; Screening; Engineering3 Energy Use; Markup Analysis

41 Statute and Context5

Life­Cycle Cost and Payback Period Analysis

National Impact Analysis

6 Preliminary MIA; NOPR Analyses

EERE-2007-BT-STD-0007 COMMENT 08.3
Framework

Document

Preliminary

Analysis

NOPR Final Rule

Market &

Technology

ScreeningAnalysis

EngineeringAnalysis

Energy Use &End Use LoadCharacterization

ShipmentsAnalysis

Markups for

EquipmentPrice

Determination

Life­Cycle

Cost andPayback

Period Analysis

Preliminary

Manufacturer

ImpactAnalysis

EERE-2007-BT-STD-0007 COMMENT 08.3
Ma

Markups to Determine Equipment Price

Purpose, Inputs, and Output

• Purpose

• Determine customer prices under a standards scenario based 

manufacturer costs.

• Characterize equipment distribution channels and market seg• Describe SEM equipment distributor/wholesaler direct costs, 

and profits.

• Inputs

• Firm balance sheets.

– Wholesalers: U.S. Census Bureau Financial Data on Other Comm

Equipment Merchant Wholesalers from Wholesale Trade, Miscel

Subjects (2002).

• Output

• Baseline and incremental markups.

EERE-2007-BT-STD-0007 COMMENT 08.3
Markups to Determine E

SEM Equipment Distribution Channels

• Estimated Fraction (%) of Equipment Shipments by Distrib

Channels*

40% Direct to OEMs

25% via Distributors to OEMs

35% via Distributors to End Users

*DOE assumed the same market shares by distribution channel for all n

EERE-2007-BT-STD-0007 COMMENT 08.3
Markups to Determine E

Baseline and Incremental Markups

• Markups relate customer price to cost of goods sold (COG• Baseline markups relate price to cost prior to a change in e

• Baseline markups indicate a customer price that covers all of a who

contractor’s expenses plus profit.

• Direct labor costs (salaries, payroll, rental and occupancy) are inclu

• Incremental markups relate the incremental change in cus

to the incremental change in COGS beyond baseline

• Some distribution costs remain constant with COGS increases.• Incremental markups cover only expenses that vary with COGS – i

expenses that increase due to an increase in equipment efficiency.

– For example, direct labor costs (salaries, payroll, rental and occupancy) 

efficiency­induced changes in COGS.

• DOE assumes other operating costs and profit will scale proportion

COGS.

EERE-2007-BT-STD-0007 COMMENT 08.3
Markups to Determine E

Distribution and Installation Markups and Sales 

• Wholesaler, OEM and retailer markups estimated from Cen

Financial Data

EERE-2007-BT-STD-0007 COMMENT 08.3
Energy Use C

Energy Use Characterization

• Motor losses consist of I2R losses (both stator and rotor), cor

stray losses and friction and windage losses

• DOE’s mathematical description of energy use separates mo

into a constant component and a component that depends on 

of the motor loading.

• Annual energy (E) consumed by was calculated as:

Eann = Hop × (PNL + PLL × L2 )

• Reactive power may or may not contribute to increased energ

EERE-2007-BT-STD-0007 COMMENT 08.3
Energy Use C

Energy Use Characterization (cont.)

250

y=67.025x+139.39

R2=0.9874

600500

Reactive Power (watts) y

0.00 0.20 0.40 0.60 

MotorLoading

200

400

Loss (watts) 150 300 100

200

50

100

0 0

0.00 0.20 0.40 0.60 0.80 1.00 1.20

SquareofMotorLoading

EERE-2007-BT-STD-0007 COMMENT 08.3
Preliminary Manufacturer 

Request for Comment:

Costs and Losses from Reactive Power

Issue: Reactive power creates costs for the electrical supply 

by requiring either power factor correction or requiring more cu

capacity to deliver the same actual power. Reactive power m

induce consumptive losses both on the consumer electrical cir

and on the electrical system in general. DOE invites comment 

best to estimate the cost implications of reactive power. DOE 

invites comment on the size and importance of reactive power 

and on analytical approaches and data that can be used to

characterize the fraction of motor reactive power that may res

consumptive losses.

EERE-2007-BT-STD-0007 COMMENT 08.3
2

34

Background and Legal Authority

5

Public Meeting Agenda

2 Market & Tech; Screening; Engineering3 Energy Use; Markup Analysis

41 Statute and Context5

Life­Cycle Cost And Payback Period Analysis

National Impact Analysis

6 Preliminary MIA; NOPR Analyses

EERE-2007-BT-STD-0007 COMMENT 08.3
Framework

Document

Preliminary

Analysis

NOPR Final Rule

Energy UseCharacterization

Market andTechnologyAssessment

ScreeningAnalysis

EngineeringAnalysis

Markups toDetermine

EquipmentPrice

Life­Cycle

Cost andPayback

Period Analysis

ShipmentsAnalysis

Preliminary

Manufacturer

ImpactAnalysis

EERE-2007-BT-STD-0007 COMMENT 08.3
Life­Cycle Cost and Payback P

Life­Cycle Cost Analysis

• Economic evaluation from the customer perspective.• Life­cycle cost (LCC) equals customer price plus the sum 

operating costs discounted to a particular base year.

• Results are expressed as LCC difference of the baseline (L

minus the standard level.

• Simple payback period (PBP ­ in years) is also calculated a

reported in this analysis.

Combine

Changes

in Costs

LC

First Cost (Consumer Price + Installation Cost)

Operating Expenses Convert to

Present

Value

EERE-2007-BT-STD-0007 COMMENT 08.3
Life­Cycle Cost and Payback P

Selection of Efficiency Levels for Analysis

• Five efficiency levels were examined for equipment in the

engineering analysis.

• Five adjusted efficiency levels were selected for the LCC a

• Level 0 represents the current market level SEMs.• Level 1 is 1% below NEMA premium for a 1 HP polyphase motor• Level 2 is equivalent to the NEMA premium level for medium moto• Level 3 is 1% above NEMA premium for a 1 HP polyphase motor• Level 4 is 2.5% above NEMA premium for a 1 HP polyphase moto• Level 5 is Max Tech

• Efficiency levels are matched between product classes an

ratings using engineering scaling laws and scaling factors

EERE-2007-BT-STD-0007 COMMENT 08.3
Life­Cycle Cost and Payback P

LCC Calculation Flowchart

From Engineering

Analysis

From Markups to

Determine

Product Price

From Energy Use

Characterization

EERE-2007-BT-STD-0007 COMMENT 08.3
Preliminary Manufacturer 

Request for Comment:

Baseline Efficiency

Issue: DOE estimated an average efficiency in the base case 

to the engineering baseline efficiency, and assumed no efficie

trends in the base case. DOE invites comments on the baseli

efficiency estimate and information on the distribution of efficie

currently in the marketplace along with expected trends in the 

market efficiencies.

EERE-2007-BT-STD-0007 COMMENT 08.3
Life­Cycle Cost and Payback P

Electricity Prices

• Electricity prices are distributions of average prices derived 

EIA form 861 data and adjusted for inflation.

• Electricity price projections based on Energy Information

Administration’s Annual Energy Outlook (AEO) 2008 referen

the commercial sector.

• AEO 2008 high growth and low growth cases will be run as

sensitivities.

EERE-2007-BT-STD-0007 COMMENT 08.3
Life­Cycle Cost and Payback P

Other Inputs

• Installation Costs

• DOE assumed a $252.90 installation cost (2007$)• Costs were based on RS Means electrical cost data.• Installation costs assumed not to vary with equipment price or effic

• Discount Rates

• Derived from estimates of the cost of capital of companies for com

industrial sectors.

• Cost of capital is calculated from the weighted­average cost of cap

the company to obtain equity and debt financing.

• Estimate is made using 40­year averages of cost of capital equatio• Weighted­average value (real) is: 5.92% for agricultural and indust

and; 5.89% for commercial owners.

EERE-2007-BT-STD-0007 COMMENT 08.3
Life­Cycle Cost and Payback P

Other Inputs (cont.)

• Equipment Lifetime

• Used average age of 9 years for polyphase motors and 7 y

capacitor start motors based upon the literature survey and 

input during the analysis and discussion period for the “Det

Concerning the Potential for Energy Conservation Standard

Electric Motors” published on July 10, 2006.

EERE-2007-BT-STD-0007 COMMENT 08.3
Life­Cycle Cost and Payback P

Example of Life­Cycle Cost Analysis Resu

(LCC Savings)

0

100200300400500

­100 40 180 320 460 

Life­cycle Cost Savings ($)

Frequency

Mean = $29

Polyphase, 1 HP motor, Candidate Standard Level 2, 

EERE-2007-BT-STD-0007 COMMENT 08.3
Life­Cycle Cost and Payback P

U.S. National Average Life­Cycle Cost Analysis R

$500$600$700$800$900

$1,000

$1,100

Life­Cycle Cost

Polyphase

1 HP

CSCR

0.75 HP

CSIR

0.5 HP

60% 65% 70% 75% 80% 85% 90% 

Efficiency

EERE-2007-BT-STD-0007 COMMENT 08.3
Life­Cycle Cost and Payback P

Example of Payback Period Analysis Result

CSIR, 0.5 HP motor, Candidate Standard Level 3, 75

EERE-2007-BT-STD-0007 COMMENT 08.3
Life­Cycle Cost and Payback P

U.S. National Average Payback Period Analysis R

05

1015202530

Payback Period (years) Polyphase 1 HP CSCR 0.75 HP

CSIR

0.5 HP

70% 75% 80% 85% 

Efficiency

EERE-2007-BT-STD-0007 COMMENT 08.3
2

34

Background and Legal Authority

5

Public Meeting Agenda

2 Market & Tech; Screening; Engineering3 Energy Use; Markup Analysis

41 Statute and Context5

Life­Cycle Cost and Payback Period Analysis

National Impact Analysis

6 Preliminary MIA; NOPR Analyses

EERE-2007-BT-STD-0007 COMMENT 08.3
Framework

Document

Preliminary

Analysis

NOPR Final Rule

Energy UseCharacterization

Market andTechnologyAssessment

ScreeningAnalysis

EngineeringAnalysis

Markups toDetermine

EquipmentPrice

Life­Cycle

Cost andPayback

Period Analysis

ShipmentsAnalysis

Preliminary

Manufacturer

ImpactAnalysis

EERE-2007-BT-STD-0007 COMMENT 08.3
National 

Purpose

• Shipments Analysis

• Estimate small electric motor (SEM) equipment shipments over tim

• National Impact Analysis

• Estimate the National Energy Savings (NES) from SEM equipment 

efficiency levels.

• Estimate the national economic impact on the nation (or the Net Pr

Value (NPV)) of the SEM equipment at different efficiency levels.

EERE-2007-BT-STD-0007 COMMENT 08.3
Nationa

National Impact Analysis Process

Shipments

Model

National

Energy

Savings

National

Economic

Impacts

LCCAnalysis

Results and

Other Inputs

N

Ener

(

N

Net P

(200

• National energy savings calculated for period from 2015­204• NPV calculated for period from 2015­2055 (40 years).

EERE-2007-BT-STD-0007 COMMENT 08.3
National 

Request for Comment:

Purchase Price Elasticity

Issue: An increase in the installed cost of small electric moto

reduce their purchase due to migration by OEMs to totally enc

motors, which are not covered by DOE standards, or other fac

However, DOE has not found any data that would allow it to e

the elasticity of small electric motor shipments with respect to 

in their purchase price or other factors. DOE requests informa

the level of price change for covered small electric motors that 

be likely to induce migration to totally enclosed motors, as wel

data on what would be an appropriate value for purchase priceelasticity.

EERE-2007-BT-STD-0007 COMMENT 08.3
National 

Shipments by Application

Equipment Cla

No. Application Polyphase CSIR 

1 Air and gas compressors 9.2% 8.1% 

2 Commercial and industrial heating, ventilating, air­conditioning, and refrigeration equipment 4.3% 8.4% 

3 Commercial laundry machinery 0.4% 1.2% 

4 Conveyors 18.8% 11.8% 

5 Farm machinery 3.0% 10.9% 

6 Food machinery 8.2% 2.1% 

7 General industrial machinery 3.4% 2.4% 

8 Industrial and commercial fans and blowers 5.6% 5.9% 

9 Machine tools 7.3% 1.9% 

10 Packaging machinery 1.0% 0.3% 

11 Pumps and pumping equipment 33.0% 41.1% 

12 Service industry machinery 1.5% 3.0% 

13 Textile machinery 1.2% 0.4% 

14 Woodworking machinery 3.1% 2.4% 

TOTAL 100% 100% 

EERE-2007-BT-STD-0007 COMMENT 08.3
National 

Polyphase Shipments by Size and Poles

Estimate for Year 2007

Motor Horsepower/Standard

Kilowatt Equivalent Six Poles Four Poles Two Poles 

1/4 hp/0.18 kW 1,967 7,637 1,967 

1/3 hp/0.25 kW 4,784 16,289 3,264 

1/2 hp/0.37 kW 8,181 49,884 3,607 

3/4 hp/0.55 kW 12,286 59,460 82,596 

1 hp/0.75 kW 17,608 71,708 17,608 

11⁄2 hp/1.1 kW 5,885 146,033 5,885 

2­3 hp/1.5­2.2 kW ­ 28,268 12,817 

Total 50,711 379,279 127,744 

EERE-2007-BT-STD-0007 COMMENT 08.3
National 

Profile of Affected Stock

CSIR Motor Affected Stock

0.0

10.020.030.040.050.060.0

(Millions)

2010 2015 2020 2025 2030 2035 2040 2045 2050 

EERE-2007-BT-STD-0007 COMMENT 08.3
National 

Annual Savings and Expenses

­$0.10­$0.05

$0.00$0.05$0.10$0.15

2015 2020 2025 2030 2035 2040 2045 2050 

Billions of 2007 Dollars

Equipment Cost

Operating Cost Savings

Net Savings

EERE-2007-BT-STD-0007 COMMENT 08.3
National Energy Savings

2.52.01.51.00.50.0

70% 75% 80% 85%

Efficiency

National 

9

National Energy Savings (quads) CSIR 0.5 HP y = 11.1x ­ 6.8 y = 2.4x ­ 1.8 Polyphase 1 HP

y = 0.72x ­ 0.47

CSCR

0.75 HP

EERE-2007-BT-STD-0007 COMMENT 08.3
National 

National Net Present Value

at 3% Real Discount Rate

Efficiency

­1

012345

70% 75% 80% 85% 90

NetPresentValue(billion$)

Polyphase

1 HP

CSCR

0.75 HP

CSIR

0.5 HP

EERE-2007-BT-STD-0007 COMMENT 08.3
National 

National Net Present Value

at 7% Real Discount Rate

Efficiency

­0.5

0

0.5

1

1.5

2

70% 75% 80% 85% 

NetPresentValue(billion$)

Polyphase

1 HP

CSCR

0.75 HP

CSIR

0.5 HP

EERE-2007-BT-STD-0007 COMMENT 08.3
2

34

Background and Legal Authority

5

Public Meeting Agenda

2 Market & Tech; Screening; Engineering3 Energy Use; Markup Analysis

41 Statute and Context5

Life­Cycle Cost and Payback Period Analysis

National Impact Analysis

6 Preliminary MIA; NOPR Analyses

EERE-2007-BT-STD-0007 COMMENT 08.3
Framework

Document

Preliminary

Analysis

NOPR Final Rule

Market &

Technology

ScreeningAnalysis

EngineeringAnalysis

Energy Use &End Use LoadCharacterization

ShipmentsAnalysis

Markups for

EquipmentPrice

Determination

Life­Cycle

Cost andPayback

Period Analysis

Preliminary

Manufacturer

ImpactAnalysis

EERE-2007-BT-STD-0007 COMMENT 08.3
Preliminary Manufacturer 

Preliminary Manufacturer Impact Analysis Ove

• DOE obtained information from NEMA members

• Sent an interview guide to four big manufacturers• Received written responses• Discussed responses on individual telephone interviews

• Topics discussed

• Engineering analysis• Market information (e.g. shipments)• Key issues (as defined by the manufacturers)• Company niches• Capital costs and investments• Facility impacts• Impacts on consumers

EERE-2007-BT-STD-0007 COMMENT 08.3
Preliminary Manufacturer 

Small Electric Motors Key Issues

• Production and product mix

• Higher standards means higher per­unit costs• Consumers may shift to less costly products

• Compliance costs

• Conversion capital expenditures• Product­conversion expenses

• Exports, Foreign Competition, and Outsourcing

• Export sales• Domestic market served by foreign competition• Domestic production levels

EERE-2007-BT-STD-0007 COMMENT 08.3
Preliminary Manufacturer 

Small Electric Motors Key Issues

• Market Shares and Industry Consolidation

• New companies entering• Companies exiting• Companies merging

• Cumulative Burden

• Combined effect on manufacturers, groups of manufacture

entire industry

• Level and timing of investments expected• What circumstances allow manufacturers to make expendi

comply

EERE-2007-BT-STD-0007 COMMENT 08.3
Preliminary Manufacturer 

Summary of Major Issues

• Capital expenses to produce standards compliant motors

• Small electric motors represent a small portion of the majo

manufacturers business

• Small manufacturers have fewer sources from which to rai• Manufacturers may leave the market

• Maintaining product availability and features

• Motors may physically become larger which could inhibit us

certain applications

• Horsepower ratings could consolidate, eliminating part of th

• Enforcement of standards

• Concern about the feasibility of enforcement

EERE-2007-BT-STD-0007 COMMENT 08.3
Preliminary Manufacturer 

Request for Comment:

Enforcement of imported OEM equipment

Issue: DOE understands that enforcement of energy efficiencrequirements for small electric motors is unlike other consume

products or commercial equipment, where small motors are

components of domestic and imported OEM equipment. DOE

requests data and information from interested parties that can 

in evaluating the potential impact on exports, foreign competit

outsourcing.

EERE-2007-BT-STD-0007 COMMENT 08.3
ANOPR NOPR Final Rule

Statu

Analyses for Notice of Proposed Rulemaking 

Framework

Document

EnvironmentalAssessment

Life­Cycle

CostSubgroupAnalysis

Manufacturer

ImpactAnalysis

Utility

ImpactAnalysis

EmploymentImpactAnalysis

Revise

Preliminary

Analysis

NOPR Preliminary Analysis Final Rule

EERE-2007-BT-STD-0007 COMMENT 08.3
ANOPR NOPR Final Rule

Statu

Analyses for Notice of Proposed Rulemaking 

Framework

Document

EnvironmentalAssessment

Life­Cycle

CostSubgroupAnalysis

Manufacturer

ImpactAnalysis

Utility

ImpactAnalysis

EmploymentImpactAnalysis

Revise

Preliminary

Analysis

NOPR Preliminary Analysis Final Rule

EERE-2007-BT-STD-0007 COMMENT 08.3
Revise Prelim

Revise Preliminary Analysis

• Consider comments• Revise using latest data

National Impacts

Analysis

• Consider comments• Revise using latest data• Conduct LCC sub­group analys

Life­Cycle Cost and

Payback Period

Analyses

• Consider comments• Revise using latest data

Engineering Analysis

Analysis Action

EERE-2007-BT-STD-0007 COMMENT 08.3
ANOPR NOPR Final Rule

Statu

Analyses for Notice of Proposed Rulemaking 

Framework

Document

EnvironmentalAssessment

Life­Cycle

CostSubgroupAnalysis

Manufacturer

ImpactAnalysis

Utility

ImpactAnalysis

EmploymentImpactAnalysis

Revise

Preliminary

Analysis

NOPR Preliminary

Analysis

Final

Rule

EERE-2007-BT-STD-0007 COMMENT 08.3
LCC Sub

Life­Cycle Cost Subgroup Analysis

• Purpose

• Evaluate impacts on any identifiable groups or customers wh

disproportionately affected by any national energy efficiency s

• Method

• Analyze the LCC and payback periods (PBPs) for those custo

into any identifiable groups. LCC spreadsheet model allows fo

inputs to represent particular groups.

• Possible subgroups include small businesses (i.e. those with 

revenues) and farmers.

• Output

• Customer subgroup life­cycle costs and payback periods.• Identification of subgroups particularly affected by a new stan

EERE-2007-BT-STD-0007 COMMENT 08.3
LCC Sub

Purchase Price Impacts

• DOE will be especially sensitive to increases in the purchase p

equipment due to new standards, to avoid negative impacts on

identifiable population groups that may not be able to afford sig

increases in equipment price.

EERE-2007-BT-STD-0007 COMMENT 08.3
ANOPR NOPR Final Rule

Statu

Analyses for Notice of Proposed Rulemaking 

Framework

Document

EnvironmentalAssessment

Life­Cycle

CostSubgroupAnalysis

Manufacturer

ImpactAnalysis

Utility

ImpactAnalysis

EmploymentImpactAnalysis

Revise

Preliminary

Analysis

NOPR Preliminary

Analysis

Final

Rule

EERE-2007-BT-STD-0007 COMMENT 08.3
Manufacturer I

Manufacturer Impact Analysis

• Purpose

• Assess the impacts of standards on small electric motor man• Identify and estimate impacts on manufacturer sub­groups th

more severely impacted than the industry as a whole.

• Examine the impact of cumulative regulatory burdens on the 

• Method

• Analyze industry cash flow and net present value through use 

Government Regulatory Impact Model (GRIM).

• Interview manufacturers to refine inputs to the GRIM, develop 

analyses, and address qualitative issues.

• Output

• Manufacturer sub­group net present value impacts.• Other sub­group net present value impacts.• Other impacts.

EERE-2007-BT-STD-0007 COMMENT 08.3
Manufacturer I

Manufacturer Impact Analysis (MIA) Proces

• The MIA process consists of three phases:

Phase 1 Phase 2 Phase 3

Industry

profile

Develop

straw­manGRIM

Develop

interviewguide

Interviews

& industrywide /

subgroup

analyses

Assess directemployment,

competition,cumulativeburden

EERE-2007-BT-STD-0007 COMMENT 08.3
Screenin A

Engineering A

LCC Anal

National En

Consumer Su

Utility Imp

Environmenta

Indirect Emp

Manufacturer I

The MIA is both concurrent and coordinated with 

throughout the rulemaking process.

Phase I

Industry Profile

Phase III

Manufacturer Interviews

Revised Industry Cash Flow

Manufacturer Subgroup Analysis

Qualitative Assessment

Phase II

“Strawman” GRIM

Manufacturer Impact Analysis Other Rulemaking A

g 

Screening An

Engineering A

LCC Analy

Savings An

National Ene

Savings Ana

Consumer Su

Utility Impa

Environmental 

Impac

Indirect Emplo

Impacts

EERE-2007-BT-STD-0007 COMMENT 08.3
Manufacturer I

Phase I: Industry Profile

• Collect financial and market information:

• Industry reports;• Company annual reports and websites;• Trade journals;• U.S. Census Bureau;• SEC 10­K form filings;• Information from the preliminary activities preceding the 

manufacturer production costs, markups; and manufact

selling prices, shipments.

EERE-2007-BT-STD-0007 COMMENT 08.3
Manufacturer I

Phase II: Develop Straw­man GRIM

• The Government Regulatory Impact Model (GRIM) is an i

cash flow analysis that estimates the change in industry 

due to the introduction of new efficiency standards.

Manufacturer Prices

Shipments

Manufacturing 

Financial Inform

Cash Flow Impacts,

Changes in Industry NPV

GRIM

EERE-2007-BT-STD-0007 COMMENT 08.3
Manufacturer I

Phase II: Develop Interview Guide

• A critical aspect of the MIA involves interviews with manuf

An interview guide is sent to manufacturers in preparation 

III.

• Interview topics will include:

• Engineering analysis; • Import / Export issue• Shipments model; • Consolidation / comp

impacts; • Cost structure and financial

parameters; • Replacement parts o

refurbishments; • Conversion costs (capital

expenditures, tooling, R&D, • Impact of the standar

testing); effective date; and

• Impact of other regulations / • Other topics importan

cumulative burden; manufacturers

• Direct employment impacts;

EERE-2007-BT-STD-0007 COMMENT 08.3
Manufacturer I

Phase III: Manufacturer Interviews

• Expected timeframe.• Time and personnel commitment for manufacturers (indus

GRIM, GRIM assumptions, subgroup analysis discussion).

• Confidentiality agreements.

EERE-2007-BT-STD-0007 COMMENT 08.3
Manufacturer I

Phase III: Manufacturer Subgroup Analysi

• The subgroup analysis is a more focused version of the in

wide analysis.

• Work with subgroup representatives to tailor a GRIM incor

unique financial characteristics.

• Consider and focus on issues of importance to the subgrou

including employment, capacity utilization and cumulative b

• Review draft findings with subgroup members during deve

EERE-2007-BT-STD-0007 COMMENT 08.3
ANOPR NOPR Final Rule

Statu

Analyses for Notice of Proposed Rulemaking 

Framework

Document

EnvironmentalAssessment

Life­Cycle

CostSubgroupAnalysis

Manufacturer

ImpactAnalysis

Utility

ImpactAnalysis

EmploymentImpactAnalysis

Revise

Preliminary

Analysis

NOPR Preliminary Analysis Final Rule

EERE-2007-BT-STD-0007 COMMENT 08.3
Utility I

Utility Impact Analysis

• Purpose

• Investigate the effects on electric utilities from reduced energ

consumption and reduced peak load demand due to new ene

conservation standards.

• Method

• Uses national energy savings results.• Uses the Energy Information Administration’s National Energ

System (NEMS) tailored for DOE’s Building Technologies Pro

(NEMS­BT).

• Output

• Change in electricity sales and price by region.• Change in the mix of electricity generation.• Change in new capacity construction.

EERE-2007-BT-STD-0007 COMMENT 08.3
ANOPR NOPR Final Rule

Statu

Analyses for Notice of Proposed Rulemaking 

Framework

Document

EnvironmentalAssessment

Life­Cycle

CostSubgroupAnalysis

Manufacturer

ImpactAnalysis

Utility

ImpactAnalysis

EmploymentImpactAnalysis

Revise

Preliminary

Analysis

NOPR Preliminary Analysis Final Rule

EERE-2007-BT-STD-0007 COMMENT 08.3
Employment I

Employment Impact Analysis

• Purpose

• Report net jobs created or eliminated nationally as a consequ

energy conservation standards.

• Method

• Uses the ImSET (Impact of Sector Energy Technologies) mo

evaluation of indirect employment impacts.

• Changes in equipment and energy expenditures are develope

National Energy Savings Analysis.

• Direct employment impacts are developed in the Manufacture

Analysis.

• Output

• Change in the commercial and energy sector employment as 

consequence of new energy conservation standards.

EERE-2007-BT-STD-0007 COMMENT 08.3
ANOPR NOPR Final Rule

Statu

Analyses for Notice of Proposed Rulemaking 

Framework

Document

EnvironmentalAssessment

Life­Cycle

CostSubgroupAnalysis

Manufacturer

ImpactAnalysis

Utility

ImpactAnalysis

EmploymentImpactAnalysis

Revise

Preliminary

Analysis

NOPR Preliminary

Analysis

Final

Rule

EERE-2007-BT-STD-0007 COMMENT 08.3
Environment

Environmental Assessment

• Purpose

• Report environmental impacts as a consequence of new ene

conservation standards, including changes in power plant em

• Method

• Energy savings results taken from the National Energy Savin• Energy Information Administration’s National Energy Modelin

(NEMS) provides power­plant emissions.

• Output

• Estimate of national emission reductions of sulfur dioxide (SO

of nitrogen (NOx), carbon dioxide (CO2) and mercury (Hg).

EERE-2007-BT-STD-0007 COMMENT 08.3
Environmen

Request for Comment:

Monetary Value of Emissions

Issue: DOE invites comment on the monetary value of Green 

Gas emissions reduction. DOE will use monetary values to re

the potential value of such emissions reductions. DOE invites

comment on methods for estimating the net monetary value of 

House Gas emissions reductions. DOE also invites comment 

which data and reports provide information regarding widely a

values that may be used in DOE’s analyses.

EERE-2007-BT-STD-0007 COMMENT 08.3
ANOPR NOPR Final Rule

Statu

Analyses for Notice of Proposed Rulemaking 

Framework

Document

EnvironmentalAssessment

Life­Cycle

CostSubgroupAnalysis

Manufacturer

ImpactAnalysis

Utility

ImpactAnalysis

EmploymentImpactAnalysis

Revise

Preliminary

Analysis

NOPR Preliminary Analysis Final Rule

EERE-2007-BT-STD-0007 COMMENT 08.3
Regulatory I

Regulatory Impact Analysis

• Purpose

• Investigate the national impacts due of non­regulatory alterna

compared with mandatory energy conservation standards.

• The non­regulatory alternatives that may be considered includ

– No new regulatory action; early replacement; prescriptive standa

tax credits; manufacturer tax credits; customer rebates; voluntary 

targets; bulk government procurement.

• Method

• NES spreadsheet model is modified to consider scenarios. Th

energy prices and escalation factors; implicit market discount 

customer purchase price, operating cost, and income elasticit

equipment stock data.

• Output

• National Energy Savings and Net Present Value of the non­re

alternatives.

• Impact of non­regulatory alternatives on purchase price and u

efficient equipment. 

EERE-2007-BT-STD-0007 COMMENT 08.3
Consensus Recommendations

• DOE seeks to encourage development of consensus propo

new standards because standards with such broad­based 

likely to balance effectively the economic, energy, and env

interests affected by standards.

• Any recommendation must satisfy the seven statutory crit

provided by EPCA for determining whether an energy con

standard is technologically feasible and economically just

will result in significant energy savings.

• Any consensus recommendation should also include info

DOE can use to assess the seven statutory criteria that de

whether the benefits of the standard exceed its burdens to 

greatest extent practicable.

EERE-2007-BT-STD-0007 COMMENT 08.3
The Energy Policy and Conservation Act (EPCA) direct

consider seven factors when setting energy conservation 

Environmental assessmen

Utility impact analysis

Employment impact analys

7. Other factors the Secretary

considers relevant

6. Need for national energy National impact analysis

conservation

5. Impact of any lessening of Manufacturer impacts ana

competition

Screening analysisEngineering analysis

4. Impact on utility or performance

3. Total projected energy savings National impact analysis

2. Lifetime operating cost savings Life­cycle cost analysis

Life­cycle cost analysis

Manufacturer impacts ana

1. Economic impact on consumers and

manufacturers

Factor Analysis

EERE-2007-BT-STD-0007 COMMENT 08.3
DOE Seeks Comments on its Proposal

In all correspondence, include all of the following:

– Energy Conservation Standards for Small Electric Motors

– Docket Number EERE­2007–BT–STD–0007

– Regulatory Identification Number (RIN) 1904–AB70

Email: Small_electric_motors_std.rulemaking@hq.doe.gov

Postal Mail: Courier:

Ms. Brenda Edwards Ms. Brenda Edwards

U.S. Department of Energy U.S. Department of Ener

Building Technologies Program, Mailstop EE­2J Building Technologies P

1000 Independence Avenue, S.W. 950 L’Enfant Plaza, S.W.

Washington, DC 20585­0121 Washington, DC 20024

Telephone: (202) 586­294

Comment period closes: March 2, 2009

EERE-2007-BT-STD-0007 COMMENT 08.3