1 | Building Technologies Program eere.energy.gov

The Parker Ranch installation in Hawaii

BUILDING TECHNOLOGIES PROGRAM

Preliminary Analysis Public Meeting on Energy 

Conservation Standards for Residential 

Furnace Fans

Mohammed Khan

Department of Energy

Energy Efficiency & Renewable Energy

Mohammed.Khan@ee.doe.gov

July 27, 2012
2 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

• 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

– Focus on issues, not personalities

– One person speak at a time (raise hand to be recognized; state 

your name for the record)

– Set cell phones to silent/vibrate

• Housekeeping Items

Welcome
3 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

• The Department is broadcasting this meeting live over 

the Internet.

• DOE is providing the webcast to accommodate 

interested parties who are unable to attend the public 

meeting in person.

• The web broadcast allows interested parties to listen in 

and view the presentation slides.

• All interested parties are encouraged to submit written 

comments after the public meeting.

Listening Via the Webcast
4 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

• To present methodologies and characterize results 

for analyses to date.

• To discuss specific issues related to each analysis.

• To seek input from attendees on methodologies, 

assumptions and data sources.

• To describe upcoming analyses and next steps.

Interested parties who contacted DOE to request an 

opportunity to issue an opening statement may do so now.

Purpose of the Public Meeting
5 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

• Comments concerning each issue are welcome.

• Participants are invited to raise additional issues for 

discussion today.

• Interested parties may provide comments on the 

preliminary analyses through September 10, 2012.

Issue Box: Throughout this presentation, specific issues will 

be brought up for discussion on slides such as this, with 

identifying numbers corresponding to those in the Executive 

Summary of the TSD. 

Comments from Interested Parties
6 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

• In all correspondence, please include all of the following:

– Energy Conservation Standards for Residential Furnace Fans

– Docket Number: EERE-2010-BT-STD-0011

– Regulatory Identification Number (RIN): 1904–AC22

• Contact Information

 Comment period closes: September 10, 2012

Postal Mail: 

Ms. Brenda Edwards

U.S. Department of Energy

Building Technologies Program

Mailstop EE-2J

1000 Independence Avenue, S.W.

Washington, DC 20585-0121

Courier: 

Ms. Brenda Edwards

U.S. Department of Energy

Building Technologies Program

950 L’Enfant Plaza, S.W., 6th Floor

Washington, DC 20024 

Telephone: (202) 586-2945

Comments From Interested Parties

Email: FurnFans-2010-STD-0011@ee.doe.gov
7 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

Public Meeting Agenda

Markups, Energy Use Characterization, LCC 

and Payback Period Analysis

National Impact Analysis

3

4

2

Engineering Analysis

1 Introduction and Overview

Market and Technology Assessment and 

Screening Analysis

5

6 Preliminary Manufacturer Impact Analysis

7 Next Steps
8 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

Introduction and Overview

Regulatory Authority

Energy Policy and Conservation Act (EPCA) of 1975 

(Public Law 94-163), as amended by the Energy Policy Act 

(EPACT) of 2005 (Public Law 109-58) and the Energy 

Independence and Security Act of 2007 (Public Law 110-

140)

• “...not later than December 31, 2013, the Secretary shall 

consider and prescribe energy conservation standards or 

energy use standards for electricity used for purposes of 

circulating air through duct work.” (42 U.S.C. 6295(f)(4)(D))

•“Any new or amended energy conservation standard 

adopted after July 1, 2010, shall address standby mode and 

off mode energy use pursuant to 42 U.S.C. 6295(o).” (42 

U.S.C. 6295(gg)(3))
9 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

DOE has no current energy conservation standard or test 

procedure for residential furnace fans.

Introduction and Overview

Regulatory History

• Test Procedure

– DOE is developing a test procedure in a parallel rulemaking.

– DOE published test procedure NOPR on May 15, 2012.

– DOE held the test procedure NOPR public meeting on June 15, 2012.

– The test procedure NOPR comment period ends July 30, 2012. 

• Energy Conservation Standard

– DOE published the Notice of Public Meeting and Availability of the Framework 

Document on June 3, 2010.

– DOE held the Framework Document public meeting on June 18, 2010.

– DOE published the Notice of Public Meeting and Availability of the Preliminary 

Technical Support Document on July 10, 2012

– The test preliminary analysis comment period ends September 10, 2012. 

• DOE conducted the preliminary analysis on the basis of the test procedure 

proposed in the test procedure NOPR. 77 FR 28674, May 15, 2012
10 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

FER =

 (Operating Hoursx × Power Consumptionx) x=rated modes

 x=rated modes Operating Hoursx × (Maximum Airflow)

× 1000

• FER for non-hydronic air handler furnace fans:

FER =

CH × Emax + HH × Eheat + CCH × Ecirc

(CH + HH + CCH) × Qmax

× 1000

• Integrated FER (IFER) for hydronic air handlers, which includes standby and off 

mode:

IFERhydronic =

CH × Emax + HH × Eheat + CCH × Ecirc + SBH × ESB + (OH × EOFF)

(CH + HH + CCH + SBH + OH) × Qmax

× 1000

Introduction and Overview

Proposed Rating Metric Summary

The proposed Fan Efficiency Rating (FER) is the estimated annual 

electrical energy consumption normalized by the annual rated operating 

hours and the airflow in the maximum airflow-control setting. 
11 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

The Energy Policy and Conservation Act (EPCA) directs DOE to consider 

seven factors when setting energy conservation standards.

Factor Analysis

1. Economic impact on consumers 

and manufacturers

Life-cycle cost analysis

Manufacturer impact analysis

2. Lifetime operating cost savings Life-cycle cost analysis

3. Total projected energy savings National impact analysis 

4. Impact on utility or performance Screening analysis

Engineering analysis

5. Impact of any lessening of 

competition

Manufacturer impact analysis

6. Need for national energy 

conservation

National impact analysis

7. Other factors the Secretary 

considers relevant

Environmental assessment

Utility impact analysis

Employment impact analysis

Introduction and Overview

Energy Conservation Standards Rulemaking
12 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

Framework

Document

Preliminary

Activities NOPR Final

Rule

Effective

Date

Steps for the Standards Rulemaking: Preliminary 

Activities and Analyses

Shipments 

Analysis

Preliminary 

Manufacturer 

Impact Analysis

Life-Cycle

 Cost and 

 Payback

 Period

 Analyses

National 

Impact 

Analysis

Market & 

Technology 

Assessment

Screening 

Analysis

Engineering

Analysis

Markups to

 Determine 

 Product Price

Energy Use 

Characterization

Introduction and Overview

Energy Conservation Standards Rulemaking
13 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

• The Executive Summary, which includes:

– An overview of the preliminary activities and preliminary technical support 

document (TSD);

– Key results of the analyses; and

– Issues on which DOE seeks comment from interested parties.

• Chapter 2 of the preliminary TSD provides a summary of the preliminary 

activities and includes:

– A review of the analyses conducted; and

– A discussion of comments on the framework document from interested parties and 

DOE’s responses to those comments.

• Notice of Public Meeting (NOPM) and Availability of the Preliminary TSD 

includes:

– Details of the public meeting for the preliminary activities and analyses; and

– A description of the preliminary analyses, results, and documentation available on 

the website for interested parties to review.

The following are key documents that describe the Preliminary 

Analysis activities:

Introduction and Overview

Energy Conservation Standards Rulemaking
14 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

Public Meeting Agenda

Markups, Energy Use Characterization, LCC 

and Payback Period Analysis

National Impact Analysis

3

4

2

Engineering Analysis

1 Introduction and Overview

Market and Technology Assessment and 

Screening Analysis

5

6 Preliminary Manufacturer Impact Analysis

7 Next Steps
15 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

Framework

Document

Preliminary

Activities NOPR Final

Rule

Effective

Date

Steps for the Standards Rulemaking: Preliminary 

Activities and Analyses

Shipments 

Analysis

Preliminary 

Manufacturer 

Impact Analysis

Life-Cycle

 Cost and 

 Payback

 Period

 Analyses

National 

Impact 

Analysis

Market & 

Technology 

Assessment

Screening 

Analysis

Engineering

Analysis

Markups to

 Determine 

 Product Price

Energy Use 

Characterization
16 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

Market and Technology Assessment

DOE tentatively defines a “furnace fan” as any electrically powered 

device used in residential HVAC products for the purpose of 

circulating air through duct work.

• DOE recognizes that a significant number of products may fit its 

broad interpretation of the statutory language and resulting definition.

• The boxes outlined in red represent key HVAC products that include 

a furnace fan.

HVAC System

Weatherized / 

Packaged Unit
17 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

Market and Technology Assessment

The provisional scope of coverage includes furnace fans that are 

integrated in 63% of furnaces, air conditioners, and air handling units that 

include furnace fans.

Key

Considered in this 

rulemaking.

Not considered in 

this rulemaking.
18 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

Proposed Key Product Classes

(per this Rulemaking)

Non-Weatherized, Non-Condensing Gas Furnace Fan (NWG-NC)

Non-weatherized, Condensing Gas Furnace Fan (NWG-C)

Weatherized Gas Furnace Fan (WG-NC)

Non-weatherized Oil, Non-Condensing Furnace Fan (NWO-NC)

Non-weatherized Electric Furnace / Modular Blower Fan (NWEF/NWMB)

Heat/Cool Hydronic Air Handler Fan (HAH-HC)

Manufactured Home Non-Weatherized Gas, Non-Condensing Furnace Fan (MH-NWG-NC)

Manufactured Home Non-Weatherized Gas, Condensing Furnace Fan (MH-NWG-C)

Manufactured Home Electric Furnace/ Modular Blower Fan (MH-EF/MB)

Market and Technology Assessment

DOE identified nine key product classes that represent most of the 

energy use associated with furnace fans considered in the analysis.

DOE differentiated product classes by application and internal structure.
19 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

Market and Technology Assessment

DOE identified 12 additional product classes that represent significantly 

fewer shipments and significantly less energy use.

• For the preliminary analysis, DOE grouped each non-key product 

class with a key product class to which it is closely related in 

application and fan performance-related internal structure (i.e. the 

primary criteria used to differentiate between product classes).

• DOE assigned the baseline FER or IFER and analysis results of 

each key product class to the non-key product classes with which it 

is grouped. 

• Continuing with this approach in the NOPR would result in a 

proposed efficiency level for each additional product class that is 

equivalent to the proposed efficiency level for the key product class 

with which it is grouped.
20 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

Proposed Key Product Classes

(per this Rulemaking)

Proposed Additional Product Classes 

(per this Rulemaking)

Weatherized Gas Furnace Fan (WG-NC)

Weatherized, Non-Condensing Oil Furnace Fan (WO-NC)

Weatherized Electric Furnace/Modular Blower Fan 

(WEF/WMB)

Manufactured Home Weatherized Gas Furnace Fan (MH-WG)

Manufactured Home Weatherized Oil Furnace Fan (MH-WO)

Manufactured Home Weatherized Electric Furnace/Modular 

Blower Fan (MH-WEF/WMB)

Non-weatherized Oil, Non-Condensing Furnace Fan (NWONC)

Non-Weatherized, Condensing Oil Furnace Fan (NWO-C)

Manufactured Home Non-Weatherized Oil Furnace Fan (MHNWO)

Heat/Cool Hydronic Air Handler Fan (HAH-HC)

Heat-Only Hydronic Air Handler Fan (HAH-H)

Hydronic Air Handler Fan with Coil (HAH-C)

Manufactured Home Heat/Cool Hydronic Air Handler Fan 

(MH-HAH-HC)

Manufactured Home Heat-Only Hydronic Air Handler Fan 

(MH-HAH-H)

Manufactured Home Hydronic Air Handler Fan with Coil (MHHAH-C)

Market and Technology Assessment

DOE grouped each non-key product class with a key product class to 

which it is closely related in application and internal structure.
21 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

Market and Technology Assessment

Request for Comment – Additional Product Classes

Additional Product Classes: DOE requests comment on 

the methodology for differentiating product classes and the 

resulting 9 key product classes.

DOE also seeks comment and data regarding the market for 

the 12 additional product classes and their expected energy 

performance. Specifically, DOE requests historical and future 

shipment data and energy performance data to estimate FER 

or IFER.

Issue 1
22 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

Market and Technology Assessment

DOE found that the top seven gas furnace manufacturers represent 

99% of the market. The top 10 oil furnace manufacturers represent

over 90% of the market.

Source: Appliance Magazine. 

Gas Furnace Market Share 2008

Carrier

32%

Goodman

15%

Lennox

13%

Trane

13%

Rheem

12%

York

9%

Nordyne

5%

Others

1%

 

The CAC and heat pump market share distribution is comparable to that of the 

gas furnace market.

At Least 10% 

Market Share

Less than 10% 

Market Share

• Lennox

• Thermo Pride

• ECR 

International

• Adams

• Bard

• Boyertown

• Crown Boiler

• EFM

• Kerr

• Newmac

Oil Furnace Market Share 2008

Source: Public Information and Manufacturer Feedback 
23 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

Market and Technology Assessment

As a result of the technology assessment, DOE identified nine 

technology options.

Technology Options Brief Description

Inverter technology (PSC motors) Motor controls used to extend the airflow range and flexibility of PSC motors.

X13 fan motors Constant-torque, permanent magnet motors, that are more efficient and have a 

wider airflow range than PSC motors.

ECM fan motors Constant-airflow, permanent magnet motors, that add to the efficiency and 

airflow-range benefits of X13 motors.

Backward-inclined impellers Impellers with backward facing inclined blades that can be more efficient than 

conventional forward-curved impellers.

Toroidal transformer (standby and 

off mode product classes)

A toroidal transformer has an annular core made of very tightly-wound, grainoriented, silicon steel ribbons. Operates more efficiently than conventional 

laminated core power transformers.

Switching mode power supply 

(standby and off mode product 

classes)

A more efficient solid-state power supply alternative to a conventional 

transformer-based power supply.

Fan housing design modifications Optimizing the shape of the fan housing to increase efficiency. 

Airflow path design Modifying the HVAC product envelope or elements in the airflow path, such as 

the heat exchanger, to reduce internal static pressure.

ECM control relay (standby and off 

mode product classes)

Using a control relay on an ECM to disconnect the motor to further reduce a 

system’s off mode power consumption.
24 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

Screening Analysis

Screening Analysis Methodology

• Technologies were screened using the following criteria:

– Technological feasibility

– Practicability to manufacture, install and service

– Impacts on product utility or product availability

– Impacts on health or safety.
25 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

Screening Analysis

DOE screened out three technology options.

• DOE retained six technology options for further engineering 

analysis.

• Chapter 4, Screening Analysis, of the preliminary TSD provides 

additional detail on the screening analysis.

Technology

Option

Need more 

data

Impacts 

thermal 

performance

Impacts 

product utility

Fan housing design 

modifications X

Airflow path design X X

ECM control relay 

(standby and off 

modes)

X
26 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

Screening Analysis

DOE considered six technology options.

1. Inverter motor controls (for PSC motors)

2. X13 fan motors

3. ECM fan motors (Multi-staging)

4. Backward-inclined impellers

5. Toroidal transformer*

6. Switching mode power supply*

*Standby and off mode technology options
27 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

Public Meeting Agenda

Markups, Energy Use Characterization, LCC 

and Payback Period Analysis

National Impact Analysis

3

4

2

Engineering Analysis

1 Introduction and Overview

Market and Technology Assessment and 

Screening Analysis

5

6 Preliminary Manufacturer Impact Analysis

7 Next Steps
28 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

Framework

Document

Preliminary

Activities NOPR Final

Rule

Effective

Date

Steps for the Standards Rulemaking: Preliminary 

Activities and Analyses

Shipments 

Analysis

Preliminary 

Manufacturer 

Impact Analysis

Life-Cycle

 Cost and 

 Payback

 Period

 Analyses

National 

Impact 

Analysis

Market & 

Technology 

Assessment

Screening 

Analysis

Engineering

Analysis

Markups to

 Determine 

 Product Price

Energy Use 

Characterization
29 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

Engineering Analysis

In the Engineering Analysis, DOE evaluated technologies that reduce 

furnace fan electrical consumption and characterized the relationship 

between manufacturer cost and energy consumption reduction.

Downstream Analyses

• Life-Cycle Cost and 

Payback Period

• National Impacts

• Shipments Analysis

• Manufacturer Impact 

Analysis

Output: Cost – Efficiency 

Relationship

Incremental 

Manufacturing Cost

Energy Consumption
30 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

Engineering Analysis

DOE incorporated information from the following sources in 

the Engineering Analysis.

Appliance Magazine, AHRI, GAMA

Manufacturer interviews

Product teardowns & manufacturing cost modeling

Product energy testing
31 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

Engineering Analysis

DOE acquired units for testing and teardowns to assist in 

developing FER values and cost models.

Units

• 26 units

• 6 manufacturers represented

• 800 to 2,200 nominal airflow capacity 

Technology 

Variations

• Motor Type: PSC, constant-torque brushless 

permanent magnet (X13), constant-volume

brushless permanent magnet (ECM)

• Airflow Capacity (800-2,200 CFM)

• Heat Exchanger Type (Clamshell, Tubular, 

Drum, Hydronic)

• Non-condensing / Condensing

• Fan Housing Design (Standard, Proprietary) 
32 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

• Define baseline specifications for each product class;

• Identify design options from the baseline to the max-tech as a 

pathway for improving energy efficiency;

• Conduct teardown analysis for representative products 

spanning the range of efficiency levels considered; and

• Generate cost-efficiency curves, which account for full 

production costs.

The cost-efficiency curve is developed in four steps.

Develop 

Baseline

Calculate

Costs

Develop 

Efficiency 

Pathway

Generate CostEfficiency 

Curves

Engineering Analysis
33 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

DOE selected baseline models typical of the least-efficient 

furnace fans used in commercially available residential HVAC 

models.

Engineering Analysis

Across all product classes, a baseline furnace fan includes:

• A PSC motor with 3 or fewer airflow-control settings.

• A forward-curved impeller.

• A standard, sheet-metal fan housing.

• A linear power supply. (Standby and off mode product classes).

• A laminated core power transformer. (Standby and off mode product 

classes).
34 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

DOE reviewed information from publicly-available product literature and 

FER values calculated from test data to determine baseline FER ratings.

Engineering Analysis

Key Product Class

Baseline 

FER 

(W/1000 

cfm)

Baseline 

IFER 

(W/1000 

cfm)

Baseline 

Standby 

Watts

Non-weatherized, Non-condensing Gas Furnace Fan 380 - -

Non-weatherized, Condensing Gas Furnace Fan 393 - -

Weatherized Gas Furnace Fan 333 - -

Non-Weatherized Oil Furnace Fan 333 - -

Electric Furnace / Modular Blower Fan 312 - -

Manufactured Home Non-weatherized, Noncondensing Gas Furnace Fan 295 - -

Manufactured Home Non-weatherized, Condensing 

Gas Furnace Fan 319 - -

Manufactured Home Electric Furnace / Modular 

Blower Fan 243 - -

Hydronic Air Handler Fan (Heat/Cool) - 107 11
35 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

• DOE determined average percentage reductions in FER for each efficiency 

level and applied these reductions to all product classes.

– DOE found that manufacturers use similar components and design paths to 

improve efficiency across all product classes that DOE is examining. 

– DOE does not expect the percentage reduction in FER associated with each 

design option, whether commercially available or prototype, to differ across 

product classes. 

• DOE based the reductions in FER associated with commercialized 

technologies on measurements or publicly available performance 

information. 

• DOE based the FER reductions associated with prototype technologies on 

research reports that included performance data.

Engineering Analysis

Each efficiency level above the baseline is defined by the specific 

design option used to achieve it.
36 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

DOE assigned percentage reductions in FER to each EL to obtain FER 

values for intermediate ELs. DOE also assigned a reduction in standby 

watts for the two standby design options (EL6 and EL7).

Engineering Analysis

Efficiency Level Design Option

Percent 

Reduction in 

FER from 

Baseline

Percent 

Reduction in 

FER from 

Previous EL

Reduction in 

Standby Power 

from Baseline 

(Watts)

1 Improved PSC 2% - NA

2 Inverter-Driven PSC 10% - NA

3 X13 45% - NA

4 ECM and Multi-Staging 59% - NA

5

(non-hydronic 

max-tech)

Premium ECM and 

Multi-Staging + 

Backward-Inclined 

Impeller

- 10% NA

Hydronic 6

Switching Mode Power 

Supply - - 1

Hydronic 7

(hydronic maxtech)Toroidal Transformer - - 1

A premium ECM motor is narrower and operates at higher RPM, which is 

characteristic of the motor paired with the backward-inclined prototype.
37 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

For all product classes except hydronic air handler fan classes, 

DOE analyzed four efficiency levels in addition to the baseline 

and the max-tech. 

Engineering Analysis

Efficiency Level

NWGNCNWGC

MHNWGNCMHNWGC

NWONC WGEF/ 

MB

MH-EF/ 

MB

Baseline 380 393 295 319 333 333 312 243

1 – Improved PSC 371 384 288 312 326 326 305 238

2 – PSC + Inv. 344 356 267 289 301 301 282 220

3 – X13 209 216 162 175 183 183 171 133

4 – ECM / MS 158 163 122 132 138 138 129 101

5 – Premium ECM / MS 

+ BI Impeller (max tech) 142 147 110 119 124 124 116 90.8
38 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

For furnace fans used in hydronic air handlers, DOE considered 

two additional efficiency levels (EL6 and EL7) that are associated 

with design options that reduce standby and off mode energy 

consumption.

Engineering Analysis

Efficiency Level IFER (W/1000 cfm)

Baseline 107

1 – Improved PSC 105

2 – PSC + Inverter 97.1

3 – X13 58.9

4 – ECM / Multi-staging 40.2

5 – Premium ECM / Multi-Staging + BI Impeller 36.2

6 – Switching Mode PS 35.5

7 – Toroidal Transformer (Max tech) 34.8
39 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

Engineering Analysis

Request for Comment – Rating Metrics and Capacity

Rating Metrics: DOE requests comments on the assumption 

that the proposed rating metrics, FER and IFER, will not be 

dependent on capacity because they are normalized by 

airflow in the maximum airflow-capacity setting, which is 

dictated by the heating or cooling capacity of the HVAC 

product.

Issue 2
40 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

Manufacturing cost models were developed by DOE as part of 

the efficiency-level approach.

• Bills of material were generated 

during product teardown analysis 

and entered into the cost model.

• Cost model generated 

manufacturing, material, labor, and 

overhead costs.

• Physical teardown analysis 

conducted with representative 

products.

• Preliminary manufacturer interviews 

conducted to further refine the 

analysis inputs and the results 

generated by the cost model

Engineering Analysis

Raw 

Materials

Finished 

Materials

Purchased 

Parts

Physical 

Teardown

Selection of 

Units

Fabrication 

Processes

Bill of 

Materials

Assembly 

Processes

Manufacturing 

Cost
41 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

Structure/Classification of Manufacturing Costs

Engineering Analysis

Full Cost of Product

Non-Production Cost **

Selling General 

& Admin. R & D Interest

Full Production Cost *

Direct 

Labor

Direct 

Material Overhead

Indirect labor

Indirect material

Maintenance

Depreciation

Taxes

Insurance related 

to assets

Market research

Advertising

POS promotion

Sales person 

compensation & 

travel

Logistics

- Warehousing

- Delivery

- Record keeping

Costs of 

service & 

staff units

General 

corporate 

costs –

comp., etc.

* Tax Reform Act of 1986 essentially requires companies to measure cost of goods sold as the full production cost of the goods sold.

** In a company’s income statement, many of these costs are reported as a lump sum, under SG&A. 

Costs 

associated 

with efforts to 

find new or 

improved 

products or 

production 

processes

Costs of 

borrowing 

funds
42 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

Engineering Analysis

The costs used in the engineering analysis represent the cost 

of the furnace fan and not the cost of the entire HVAC product. 

• The following components are included in the MPC estimates:

– Fan motor and integrated controls

– Primary control board

– Impeller

– Fan housing

– Components used to direct or guide airflow

• For reference, furnace fans comprise of approximately 10% of the 

total HVAC product cost. 
43 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

Engineering Analysis

DOE separated furnace fan product classes into high-volume and lowvolume product classes to account for factors that impact 

manufacturers’ production costs and purchasing power, such as:

• Some products are produced at volumes significantly larger than others.

• Some manufacturers offer most types of the HVAC products, while others 

focus on niches.

• High-volume manufacturers operating in lower-volume adjacent markets are 

expected to have purchased part price efficiencies consistent with their higher 

overall purchasing volume.

• Low-volume operations were modeled as having lower production volumes 

and fewer shifts per day.

High Volume

• Non-weatherized Gas Furnaces

• Weatherized Gas Furnaces

• Electric Furnaces / Modular Blowers

Low Volume

• Oil Furnaces

• Hydronic Air Handlers
44 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

DOE used a design option approach to estimate the cost of 

technologies not commercially available in furnace fan applications.

Engineering Analysis

Efficiency 

Level Design Option

High Volume 

MPC

Low Volume 

MPC

Efficiency 

Level

2 Inverter Controls for PSC Motor $12 $16 2

5

Premium ECM / Multi-Staging + 

Backward-Curved Impeller $107 $122 5

6 Switching Mode Power Supply NA* $7 6

7 Toroidal Transformer NA* $11 7

* Standby mode consumption is not covered in this rulemaking for high volume products.

• DOE estimated the cost of an inverter by reverse engineering an inverter that can be 

used in furnace fan applications. (Varidigm VSM-CA2)

• DOE used a 10% markup on the estimated cost for an ECM as the added cost for a 

premium ECM motor. 

• DOE used photographs and specifications found in research reports to determined 

cost model inputs to estimate the MPC of the backward-curved impeller to be $12.00 

and $12.32 for high volume and low volume products, respectively. 

• The MPC estimates for efficiency levels 6 and 7 are the same as those used in the 

direct final rule engineering analysis for HVAC products. 76 FR 37408
45 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

Engineering Analysis

Request for Comment – Inverter-Driven PSC Fan Motors

Inverter-Driven PSC Fan Motors: DOE seeks comment on 

inverter-driven PSC fan motors and requests data regarding 

their energy performance and costs.

Issue 3
46 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

Engineering Analysis Results

Engineering Analysis

Efficiency 

Level Baseline EL1 EL2 EL3 EL4 EL5

Design Option - Improved PSC PSC + Inverter X13 ECM +MultiStage

Premium ECM 

+ Multi-Stage 

+ BI Impeller

MPC $69 $71 $81 $92 $161 $176

FER Values

NWG-NC 380 371 344 209 158 142

NWG-C 393 384 356 216 163 147

MH-NWG-NC 295 288 267 162 122 110

MH-NWG-C 319 312 289 175 132 119

WG 333 326 301 183 138 124

EF/MB 312 305 282 171 129 116

MH-EF/MB 243 238 220 133 101 90.8

Cost-Efficiency Results for High-Volume Key Product Classes
47 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov 

Engineering Analysis 

Cost-Efficiency Results for High-Volume Key Product Classes 

$60

$80

$100

$120

$140

$160

$180

80 120 160 200 240 280 320 360 400

MPC

FER (W/1000 cfm)

NWG-NC

NWG-C

WG

MH-NWG-NC

MH-NWG-C

EF/MB

MH-EF/MB
48 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

Engineering Analysis

Cost-Efficiency Results for Low-Volume Key Product Classes

Efficiency 

Level Baseline EL1 EL2 EL3 EL4 EL5 EL6 EL7

Design Option Improved 

PSC

PSC + 

Inverter X13

ECM 

+MultiStage

Premium 

ECM + MultiStage + BI 

Impeller

Switch 

Mode PS

Toroidal

XFMR

MPC $84 $91 $101 $122 $191 $206 $214 $225

FER / IFER Values

NWO-NC 333 326 301 183 138 124 N/A N/A

HAH-HC 107 105 97.1 58.9 40.2 36.2 35.5 34.8
49 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

Engineering Analysis

Cost-Efficiency Results for Low-Volume Key Product Classes

$60

$80

$100

$120

$140

$160

$180

$200

$220

$240

0 50 100 150 200 250 300 350

MPC

Oil FER (W/1000 cfm)

Hydronic IFER (W/1000 cfm)

O-NC

HAH-HC
50 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

Engineering Analysis

Request for Comment – Fan Motor Turndown Ratio

Fan Motor Turndown Ratio: DOE seeks comment on the typical turndown 

ratios that can be achieved technically and in practice by each motor technology 

(i.e., baseline PSC, improved PSC, inverter-driven PSC, constant-torque ECM, 

and constant-airflow ECM).

Issue 4

• The turndown ratio is the ratio of minimum motor speed to the maximum 

motor speed.

• DOE has preliminarily found that high-efficiency motors on average have 

lower turndown ratios (i.e., a wider range of achievable speeds).
51 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

Engineering Analysis

Request for Comment – Proprietary Brushless Permanent 

Magnet Motor Technology

ECM Technology: DOE seeks comment on the validity of its 

premise that alternative motor technologies can achieve 

comparable performance (turndown ratios and efficiency) at 

comparable cost to the brushless permanent magnet motor 

technologies offered by Regal Beloit.

DOE also seeks comment on the validity of its assumption 

that these alternative motor technologies will become 

increasingly available.

Issue 5
52 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

Engineering Analysis

Request for Comment – High-Efficiency Fan Motor Control 

Costs

Fan Motor Control Costs: DOE requests comments on 

whether more costly primary control boards are required to 

be paired with higher-efficiency motors.

Issue 6
53 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

Engineering Analysis

Request for Comment – Backward-Inclined Impellers

Backward-Inclined Impellers: DOE seeks comment on the expected efficiency 

improvements across the range of operating conditions in residential applications.

DOE seeks comment on which operating conditions result in favorable and 

unfavorable performance for furnace fans that use backward-inclined impellers.

DOE seeks comment on whether design modifications or specialized components, 

such as fan motors with unique specifications (e.g., high RPM), are necessary to 

implement backward-inclined impellers.

DOE seeks comment on whether backward-inclined impellers are incompatible with 

the designs or components currently used in furnace fans.

DOE seeks comment on whether use of backward-inclined impellers could impact 

product offerings. 

DOE seeks comment on the potential costs associated with implementing backwardinclined impellers.

Issue 7
54 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

Engineering Analysis

Request for Comment – Airflow Path Design

Airflow Path Design: DOE seeks comment on airflow path 

design changes that could result in improved airflow 

efficiency.

DOE seeks comment on the expected cost and efficiency 

improvement of airflow path design improvements.

DOE seeks comment or data on the expected tradeoffs 

between airflow efficiency and thermal efficiency for design 

changes. 

Issue 8
55 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

Engineering Analysis

Request for Comment – Other Issues

Other issues: DOE invites comments and recommendations 

from interested parties on any other aspects relating to the 

Market and Technology Assessment, the Screening Analysis, 

and the Engineering Analysis.
56 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

Public Meeting Agenda

Markups, Energy Use Characterization, LCC 

and Payback Period Analysis

National Impact Analysis

3

4

2

Engineering Analysis

1 Introduction and Overview

Market and Technology Assessment and 

Screening Analysis

5

6 Preliminary Manufacturer Impact Analysis

7 Next Steps
57 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

Framework

Document

Preliminary

Activities NOPR Final

Rule

Effective

Date

Steps for the Standards Rulemaking: Preliminary 

Activities and Analyses

Shipments 

Analysis

Preliminary 

Manufacturer 

Impact Analysis

Life-Cycle

 Cost and 

 Payback

 Period

 Analyses

National 

Impact 

Analysis

Market & 

Technology 

Assessment

Screening 

Analysis

Engineering

Analysis

Markups to

 Determine 

 Product Price

Energy Use 

Characterization
58 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

• Markups for Product Price Determination:

– To characterize the channels for how products are distributed from the 

manufacturer to the consumer.

– To determine prices paid by consumers based on manufacturer selling 

prices for baseline and higher efficiency products.

• Energy Use Characterization:

– To develop energy consumption savings estimates for selected product 

efficiency levels. 

• Life-Cycle Cost (LCC) and Payback Period (PBP) Analyses:

– To develop the consumer life-cycle cost savings and payback period for 

higher efficiency products.

Markups, Energy Use Characterization,

LCC and Payback Period Analyses

Purpose
59 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

LCC & Payback Period Analyses Flowchart

Markups, Energy Use Characterization,

LCC and Payback Period Analyses 

Baseline 

Manufacturer 

Cost Engineering 

Analysis Std-Level 

Manufacturer 

Cost

Manufacturer 

Markup

Markups to 

Determine 

Product Price

Distributer & 

Contractor 

Markups

Sales Tax

Energy Use 

Characterization

Energy 

Consumption

Energy

Prices

Consumer

Price

Installation

Cost

Total

Installed Cost

Annual

Energy Cost

Repair

Cost

Maintenance

Cost

Annual

Operating 

Expense

Lifetime

Discount

Rate

Energy Price 

Trend

Lifetime 

Operating

Expense

Payback

Period

Life-Cycle

Cost
60 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

• Markups relate consumer price to cost of goods sold (CGS).

• Baseline and Incremental markups:

– Baseline markups relate direct business costs of products to baseline efficiency

– Incremental markups relate the incremental change in consumer price to the incremental 

change in CGS.

• Regional Markups developed for each of the geographical areas in the analysis.

• Sources:

– Manufacturer markups: See engineering analysis

– Wholesaler and mechanical contractor markups: Firm income statements from the 

HARDI 2011 Profit Report and from the ACCA 2005 Financial Analysis

– General contractor markups: Residential Building Construction sector financial data from 

the 2007 Economic Census

– Manufactured home manufacturer and contractor markups: Manufactured Home (Mobile 

Home) Manufacturing sector and All Other Specialty Trade Contractors sector financial 

data from the 2007 Economic Census 

– Sales taxes: 2011 Sales Tax Clearinghouse Data

Markups Analysis

Approach
61 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

• Replacement (Non-Manufactured and Manufactured Homes)

• New Construction 

– Non-Manufactured Homes (Non-MH)

– Manufactured Homes (MH)

Distribution Channels

for Residential Furnace Fans Equipment

Markups Analysis

Manufacturer Wholesaler Mechanical 

Contractor Consumer

Manufacturer Wholesaler Mechanical 

Contractor

General 

Contractor Consumer

Manufacturer

Manufactured 

Home 

Manufacturer

Manufactured 

Home 

Contractor

Consumer
62 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

Markups Analysis

In the preliminary analysis, DOE did not consider a distribution 

channel for replacing furnace fans included in already installed 

equipment. DOE requests comments whether this channel merits 

inclusion, and, if so, what would be an appropriate assumption 

for its market share.

Issue 9

Request for Comment – Distribution Channel and Market 

Share of Furnace Fans
63 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

Average Markups for Market Participants

Markups Analysis

Non-MH MH

Baseline Incr. Baseline Incr.

Manufacturer 1.35 1.30

Wholesaler (replacement for MH) 1.36 1.11 1.36 1.11

Mechanical Contractor (replacement) 1.55 1.23 1.55 1.23

Mechanical Contractor (new construction) 1.44 1.15 -

General Contractor (new construction) 1.48 1.34 -

MH Manufacturer (new construction) - 1.41 1.28

MH Contractor (new construction) - 1.61 1.31

Sales Tax 1.071
64 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

Average Markups by Product Class

Markups Analysis

Product Class Baseline 

Markup

Incremental 

Markup

Non-Weatherized, Non-Condensing Gas Furnace Fan (NWG-NC) 2.49 1.59

Non-weatherized, Condensing Gas Furnace Fan (NWG-C) 2.45 1.54

Weatherized Gas Furnace Fan (WG-NC) 2.46 1.57

Non-weatherized Oil, Non-Condensing Furnace Fan (NWO-NC) 2.30 1.46

Non-weatherized Electric Furnace / Modular Blower Fan (NWEF/NWMB) 2.41 1.54

MH Non-Weatherized Gas, Non-Condensing Furnace Fan (MH-NWG-NC) 3.04 2.35

MH Non-Weatherized Gas, Condensing Furnace Fan (MH-NWG-C) 2.96 2.29

Manufactured Home Electric Furnace/ Modular Blower Fan (MH-EF/MB) 2.95 2.28

Heat/Cool Hydronic Air Handler Fan (HAH-HC) 2.62 1.65
65 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

Markups Analysis

Request for Comment – Other Issues

DOE invites comments and recommendations from interested 

parties on any other aspects related to the Markups Analysis.
66 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

• Annual energy consumption and energy prices used to 

calculate annual energy costs

Overview

Energy Use Characterization

Energy 

Consumption

Energy

Prices

Annual

Energy Cost

– Annual energy consumption is the site energy 

use associated with operating the product.

– Energy prices are the prices consumers pay for 

energy (electricity, gas or oil).

– Multiplying annual energy consumption by 

energy prices yields the annual energy cost. 
67 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

• Furnace Fan (FF) annual energy use equals the sum of the energy used at 

each operating mode – heating, cooling, and constant circulation:

– Furnace Fan Operating Hours is determined using RECS 2005 heating and 

cooling data, furnace fan on-time ratios, and adjustment factors 

– Furnace Fan Power is determined using furnace fan performance and the system 

curve for each household

• Analysis also accounts for the impact of more efficient furnace fans on the 

overall energy use of the households space conditioning equipment

Methodology for Energy Use Determination

Energy Use Characterization







operating modes

 FF Operating Hours FF Power

FF Energy Use

i

i i
68 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

Household Sample

Energy Use Characterization

*RECS Selection:

(1) Central furnace is the main or secondary source of heat

(2) Only one housing unit is heated

(3) Heating energy consumption greater than zero

(4) Heating fuel type is natural gas, LPG, electricity, and non-MH fuel oil

** Has gas water heater & household square footage < 2000 sq ft

House

has a 

Furnace

Fan?*

RECS 2005 

House 

Sample

NWG-C

NWG-NC

WG

EF/MB

NWO-NC

MH-NWG-C

MH-NWG-NC

MH-EF/MB

HAH-HC

Out of Sample

Oil

South 

Region

Other 

Criteria**

Has 

CAC

South 

Region

No

Yes NonMH

MH

Elec

Gas

House & 

Heating

Fuel 

Type?

Elec

Gas
69 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

Energy Use Characterization

Energy Use Determination Methodology 

FER 

Efficiency levels

Fan Performance 

Curves

Mfr. 

Product Lit. 

&Test Data

System Curves Field 

Studies

RECS 2005

Data

Heating/Cooling 

Load Adjustments

Constant 

Fan 

Operation 

Field Data

Heating & Cooling 

Fan

Operating Hours

Operating Hours

Power

Household

Furnace Fan 

Energy Use

Impact on 

Furnace/AC 

Energy Use

Constant Fan 

Operating Hours
70 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

Fan Power Determination

Energy Use Characterization

200

400

600

800

1000

1200

1400

1600

1800

0

200

400

600

800

1000

1200

1400

1600

0 0.1 0.2 0.3 0.4 0.5 0.6 0.7 0.8 0.9 1 Watts Airflow (CFM)

External Static Pressure (in w.c.)

PSC (Cooling) - Airflow

PSC (Heating) - Airflow

PSC (Cfan) - Airflow

System Curve

PSC (Cooling) - Watts

PSC (Heating) - Watts

PSC (CFan) - Watts
71 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

System Curve Derivation

Energy Use Characterization

• DOE characterized the system curve by assigning External Static Pressure 

(ESP) value at the maximum cooling airflow operating mode

• DOE compiled over 1300 field ESP measurements from 27 studies that 

included furnace fans in single family and manufactured homes in different 

US regions

• ESP value used for defining the household system curve is determined by 

assigning a distribution of ESPs depending on the product class and whether 

the household has a central air conditioner

Product Class

Household 

has

Central AC

Average 

ESP 

(in. w.c.)

NWG-NC; NWG-C; NWO-NC; EF/MB; 

HAH-HC

Yes 0.73

No 0.52

WG Yes 0.52

MH-NWG-NC; MH-NWG-C; MH-EF/MB Yes 0.37

No 0.17
72 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

Fan Performance Curves Derivation 

Deriving Adjustment Factors 

for Fan Performance Curves 

to match FER values 

at each efficiency level

Fan Performance Curves 

for all product classes and 

furnace fan sizes

Generate Average

Fan Performance Curves

(Source: mfr literature & test data)

Energy Use Characterization

9 product classes

X 7 Fan Sizes (1, 1.5, 2, 2.5, 3, 3.5, 4, 5 AC Ton)

X 6 Furnace Fan Design Options

X 2 Performance Curves (Airflow & Power)

= 756 Furnace Fan Performance Curves 

Efficiency Level

NWG- NC NWG-C MH- NWG-NC MH- NWG-CNWO- NC WG EF/MB MH- EF/MB

Baseline 380 393 295 319 333 333 312 243

1 371 384 288 312 326 326 305 238

2 344 356 267 289 301 301 282 220

3 209 216 162 175 183 183 171 133

4 158 163 122 132 138 138 129 101

5 142 147 110 119 124 124 116 90.8
73 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

Fan Performance (CFM vs. ESP)

Heating Mode

Energy Use Characterization

Example: Non-Weatherized (Non-Condensing) Gas Furnace Fan, 3-Ton

500

600

700

800

900

1000

1100

1200

0 0.1 0.2 0.3 0.4 0.5 0.6 0.7 0.8 0.9 1 Airflow (CFM)

External Static Pressure (in w.c.)

PSC

PSC w/ Controls

X13

ECM (Variable Speed) - High Heat

ECM (Variable Speed) - Low Heat
74 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

Fan Performance (Watts/CFM and Watts vs. ESP)

Heating Mode

Example: Non-Weatherized (Non-Condensing) Gas Furnace Fan, 3-Ton

Energy Use Characterization

0.00

0.05

0.10

0.15

0.20

0.25

0.30

0.35

0.40

0.45

0.50

0 0.1 0.2 0.3 0.4 0.5 0.6 0.7 0.8 0.9 1 Watts/CFM

External Static Pressure (in w.c.)

PSC

PSC w/ Controls

X13

ECM (Variable Speed) - High Heat

ECM (Variable Speed) - Low Heat

0

100

200

300

400

500

600

0 0.1 0.2 0.3 0.4 0.5 0.6 0.7 0.8 0.9 1 Watts

External Static Pressure (in w.c.)

PCS

PSC w/ Controls

X13

ECM (Variable Speed) - High Heat

ECM (Variable Speed) - Low Heat
75 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

Adjustment Factor (AdjFactor) to account for:

• Building shell efficiency: Change in heating load based on the difference in 

physical size and shell attributes for homes in the future (AEO 2012 data)

• Average climate conditions: Adjust RECS 2005 energy use data for differences 

with most recent 10-year NOAA climate data

• Secondary HVAC energy use: Subtracted secondary heating or cooling 

equipment from RECS 2005 heating/cooling energy use data 

• Motor heat: Accounted for impact of heat produced by the motor on 

heating/cooling operating hours

Operating Hours – Heating and Cooling Mode

AdjFactor

Capacity

HouseHeating or Cooling Load

 

F FOperatingHours Fan On Time Ratio

 



Energy Use Characterization
76 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

Operating Hours – Constant Fan Mode

How Often is Constant 

Circulation Fan Used?

Combined Data from 

Studies

Estimated North and 

South-Hot Dry 

Region Fractions for 

LCC Analysis

Estimated SouthHot Humid Region 

Fractions for LCC 

Analysis # of HHs Pct. (%)

No constant fan 69 68% 84% 97%

Year-round 14 14% 7% 1%

During heating season 4 4% 2% 0.4%

During cooling season 4 4% 2% 0.4%

Other (some constant fan) 10 10% 5% 1%

Total 101 100% 100% 100%

• Based on fan constant circulation use studies conducted in Wisconsin and 

Minnesota.

• DOE adjustments for national sample (compared to studies):

– South Hot Humid region - 10 percent of population using constant circulation (i.e. 3.1 

percent compared to 31 percent in the studies).

– For the rest of the country (North and South Hot Dry regions) - 50 percent of population 

using constant circulation (i.e. 15.5 percent compared to 31 percent in the studies).

Energy Use Characterization
77 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

Energy Use Characterization

Request for Comment – Continuous-Circulation Operation

DOE requests comments on its characterization of use of 

continuous circulation, and information that would support use of 

alternative assumptions.

Issue 10
78 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

Impact on HVAC with More Efficient Furnace Fans

Energy Use Characterization

• Effects on Furnace and Central AC Energy Use during 

Heating/Cooling Operation

– During Heating Operation: More efficient furnace fans produce less heat which 

requires more heating operation (Note: additional electricity use by other 

furnace components is also accounted for).

– During Cooling Operation: More efficient furnace fans produce less heat which 

requires less cooling operation

• Effects on Furnace Standby Energy Use

– For all products other than hydronic air handlers: Difference in power 

consumption between the baseline efficiency level (EL 0) and the rest: for EL1 

and EL2 = 0 watt; while for EL3 and above = 3 watts.

– For hydronic air handlers: Integrated metric (IFER) includes standby and off 

mode electrical energy consumption
79 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

Summary of Results

Efficiency Level

NWG-NC NWG-C

Annual 

Electricity 

Use (kWh)

Electricity 

Use 

Savings 

(kWh)

Additional 

Fuel Use 

(MMBtu)

Annual 

Electricity 

Use (kWh)

Electricity 

Use 

Savings 

(kWh)

Additional 

Fuel Use 

(MMBtu)

Baseline (PSC) 798 NA NA 768 NA NA

Improved PSC 784 13 0.00 736 32 0.00

PSC w/ Controls 779 19 -0.04 643 125 -0.03

X13 508 290 0.28 421 347 0.39

ECM + Multi-Stage 532 265 0.33 410 357 0.44

ECM + BC Impeller 478 319 0.36 372 396 0.48

(Non-Weatherized Gas Furnace Fan, Non-Condensing & Condensing)

Energy Use Characterization
80 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

Energy Use Characterization

Request for – Comment Other Issues

DOE invites comments and recommendations on any other 

aspects related to the Energy Use Characterization.
81 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

• LCC equals total installed cost 

plus the sum of operating 

expenses discounted to a base 

year (2018).

• Economic evaluation performed 

from the consumer perspective.

• Analysis models the uncertainty 

and variability of inputs using 

Monte Carlo approach and 

probability distributions.

• Analysis implemented in an Excel®

spreadsheet combined with 

Crystal Ball.®

Life Cycle Cost and Payback Period Analysis Method

LCC and Payback Period Analyses

Total

Installed Cost

Annual

Operating 

Expense

Lifetime

Discount

Rate

Energy Price 

Trend

Lifetime 

Operating

Expense

Payback

Period

Life-Cycle

Cost
82 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

• Consumer Price = Manufacturing Cost x Markups x Sales Tax

– Manufacturing cost – from Engineering Analysis

– Markups and Sales Taxes – from Markups Analysis

Determination of Consumer Price

LCC and Payback Period Analyses

Baseline 

Manufacturer 

Cost

Std-Level 

Manufacturer 

Cost

Manufacturer 

Markup

Retailer or 

Distributer 

Markup

Sales Tax

Consumer

Price
83 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

Installation Costs Approach

• Definition: Installation costs represent the labor and materials necessary to 

install the appliance

• Method: Furnace fan installed in the furnace in the factory require no 

additional installation cost at the home

– Exception: A fraction of X13 and ECM furnace fan installations will 

require up to an hour of extra labor at startup to check and adjust 

airflow

LCC and Payback Period Analyses
84 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

Energy Prices

LCC and Payback Period Analyses

• Purpose: Develop average marginal monthly prices by geographical area. 

• Methodology: Multiply most current average annual energy prices by monthly 

price factors and marginal price factors. 

– 2010 average annual energy prices by geographical area based on:

o Electricity Prices: EIA’s 2010 Form 826 data

o Natural Gas: EIA’s 2010 Natural Gas Navigator monthly

o Oil and LPG: EIA’s 2010 State Energy Data System (SEDS)

– Monthly energy price factors by geographical area based on:

o Electricity Prices: EIA’s 1990-2010 Form 826 monthly data

o Natural Gas: EIA’s 1989-2010 Natural Gas Navigator monthly data 

o Oil and LPG: EIA’s 2009 Short Term Energy Outlook 1995-2009 historical data

– Marginal energy price factors for electricity and natural gas by 9 census divisions 

and 4 large states based on RECS 2005 billing data.
85 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

Energy Price Trends

LCC and Payback Period Analyses

10.6

10.7

10.8

10.9

11.0

11.1

11.2

11.3

11.4

11.5

11.6

2010 2015 2020 2025 2030 2035

2010¢/kWh

Year

Reference

Example: National Electricity Price Projection (Reference Case)

• Methodology: 2010 average monthly marginal energy prices by geographical 

area multiplied to projected annual energy price trends for the corresponding 

census division

– 2018-2035 trends based on EIA’s AEO 2012 Early Release by census division

– After 2035 trends based on Federal Energy Management Program (FEMP) guidelines 
86 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

Repair and Maintenance

LCC and Payback Period Analyses

• Repair Cost:

– Definition: Cost of replacing or repairing components in the furnace fan that have failed.

– Methodology: Repair occurs if fan motor lifetime is less than furnace equipment lifetime.

o Failure Year: Fan motor lifetime (expressed in operating hours) divided by furnace 

fan annual operating hours. 

o Labor Hours/Cost: Based on 2012 RS Means Facility Repair and Maintenance and 

2012 RS Means Residential Construction Data.

o Material Cost: Based on engineering and markups analysis.

• Maintenance Cost:

– Definition: Routine cost to the consumer of maintaining components in the furnace fan.

– Methodology: Assumes blower checking as part of regular equipment maintenance.

o Maintenance Frequency: Based on Decision Analysts, 2008 American Home 

Comfort Study reporting the maintenance frequency for HVAC equipment. 

o Labor Hours/Cost: Based on 2012 RS Means Facility Repair and Maintenance and 

2012 RS Means Residential Construction Data.

o Material Cost: None.
87 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

Lifetime

LCC and Payback Period Analyses

Product Class Average

Lifetime (years)

NWG-NC and NWG-C 23.6

NWO-NC 26.5

MH-NWG-NC and MH-NWG-C 18.7

EF/MB (as well as WG, MH-EF/MB, and HAH-HC) 18.0

• Definition: Age when the furnace fan is retired from service.

• Methodology: Assumed furnace fan lifetime equals furnace equipment lifetime.

– For NWG-NC, NWG-C and NWO-NC: Characterized the product lifetime based on an 

analysis of furnace lifetimes in the field using a combination of shipments data, RECS 

data on the age of the furnaces in the surveyed homes, and historical AHS data on the 

total installed furnace stock.

– For MH-NWG-NC, MH-NWG-C, and EF/MB: Characterized the product lifetime based 

on a consumer survey (Decision Analysts, 2004-2008 American Home Comfort Study), 

which reports equipment lifetime.

– For WGF, MH-EF/MB, and HAH-HC: Assumed the same lifetime distribution as EF/MB.
88 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

Discount Rates

LCC and Payback Period Analyses

Housing Type Finance Cost Based on: Mean (%)

New Construction Mortgage 3.0

Replacements Home equity loans, Credit card, Other loans, Checking & 

savings accounts, Certificates of deposit, Bonds, Stocks

5.0

• Definition: DOE uses the discount rate to determine the present value of lifetime 

operating expenses when a product is retired from service.

• Methodology: DOE derives the discount rates from estimates of the “finance 

cost” to purchase residential products using the Federal Reserve Board’s Survey 

of Consumer Finances. The finance cost can be interpreted as:

– The financial cost of any debt incurred to purchase products (such as interest charges 

on debt), or 

– The opportunity cost of any equity used to purchase products (such as interest earnings 

on household equity).

• Primary data sources: Federal Reserve Board’s Survey of Consumer Finances 

for the years 1989, 1992, 1995, 1998, 2001, 2004, and 2007.
89 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

Product Assignment in the Base Case

LCC and Payback Period Analyses

• Definition: Base case product efficiency assignment reflects the projected market 

share of products at different efficiency levels.

– Not all consumers purchase products at current minimum standard.

– LCC analysis recognizes that consumers already purchasing products at efficiencies 

greater than or equal to a prospective standard level are not impacted by the standard.

• Methodology: Projected furnace fan efficiency market share in 2018 for each 

product class based on:

– Historical Data : Sales of furnace fan by efficiency and by product class is not available. 

Historical data suggest that the market share of ECMs rose from 10 percent to 30 

percent within the last five years.

– Market Share Projection for PSC motors: Assumed market share – 50% baseline; 50% 

improved PSC furnace motors; and 0% for PSC with controls.

– Market Share Projection for ECM motors: Calculated for each product class by using 

the fraction of models with ECMs and assuming it equals 2018 market (45%).

– Market Share in Replacement/New Construction: Share of ECM fans in furnace fan 

equipment replacements is 3.7 times higher than the share in new homes (source: 

Canadian survey, 2003).
90 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

LCC and Payback Period Analyses

Request for Comment – Base-Case Furnace Fan 

Efficiency Distributions 

DOE requests comments on its estimate of the base-case 

efficiency distribution of furnace fans in 2018 and data that might 

support use of different assumptions.

Issue 12
91 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

LCC and PBP Analysis Results

LCC and Payback Period Analyses

Example: Non-Weatherized, Condensing Gas Furnace Fan

CSL Technology 

Option

Life-Cycle Cost (2011$) Life-Cycle Cost Savings Median 

Payback 

Period 

(years) 

Average 

Installed 

Cost 

Average 

Lifetime 

Operating 

Cost 

Average 

LCC 

Average 

Savings 

(2011$) 

% Households with 

Net

Cost No Impact Net Benefit

0 Baseline (PSC) 241 1,292 1,533 N/A 0 100 0 N/A

1 Improved PSC 246 1,242 1,488 10 20 76 4 0.8

2 PSC w/ Controls 265 1,095 1,361 65 35 53 12 5.3

3 X13 306 840 1,146 169 13 53 33 5.2

4 ECM + Multi-Stage 459 884 1,344 34 54 33 13 22.8

5 ECM + BC Impeller 491 836 1,327 51 71 0 29 17.3
92 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

LCC and Payback Period Analyses

Request for Comment – Other Issues

DOE invites comments and recommendations on any other 

aspects related to the Life-Cycle Cost Analysis.
93 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

Public Meeting Agenda

Markups, Energy Use Characterization, LCC 

and Payback Period Analysis

National Impact Analysis

3

4

2

Engineering Analysis

1 Introduction and Overview

Market and Technology Assessment and 

Screening Analysis

5

6 Preliminary Manufacturer Impact Analysis

7 Next Steps
94 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

Framework

Document

Preliminary

Activities NOPR Final

Rule

Effective

Date

Steps for the Standards Rulemaking: Preliminary 

Activities and Analyses

Shipments 

Analysis

Preliminary 

Manufacturer 

Impact Analysis

Life-Cycle

 Cost and 

 Payback

 Period

 Analyses

National 

Impact 

Analysis

Market & 

Technology 

Assessment

Screening 

Analysis

Engineering

Analysis

Markups to

 Determine 

 Product Price

Energy Use 

Characterization
95 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

• Shipments Analysis:

– To estimate residential furnace fan shipments over analysis 

period.

• National Impact Analysis:

– To estimate the National Energy Savings (NES) from residential 

furnace fan energy conservation standards at different efficiency 

levels.

– To estimate the national economic impact on residential furnace 

fan consumers (or the Net Present Value (NPV)) from energy 

conservation standards at different efficiency levels.

Purpose

National Impact Analysis
96 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

National Impact Analysis Process

• National energy savings calculated for period from 2018-2047.

• NPV calculated for products shipped over the same period.

National Impact Analysis

Shipments 

Model

LCC Analysis 

Results and 

Other Inputs National 

Energy 

Savings

National 

Consumer 

Economic 

Impacts

National Energy 

Savings (Quads)

National Net

Present Value 

(2011 $, billion)

Inputs

Process

Results
97 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

Approach

Shipments Analysis

• Assumes furnace fans are shipped pre-installed in furnace fan 

equipment.

• Shipments Projections by Market:

• New construction: New housing construction projections 

multiplied by historical market shares.

• Replacements: Product retirement functions (product lifetimes) 

applied to product stock. Product stock is generated with 

historical shipments.

• New Owners: Existing buildings that acquire furnaces for the 

first time. Includes consumers switching between furnace fan 

product classes. 

• Projected shipments done separately by region. 

• Accounted for impact of standards on shipments using price 

elasticities.
98 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

Shipments Analysis Flowchart

Shipments Analysis

New

Installations

Average Residential 

Furnace Fan 

Saturation

New Housing

Starts

Replacement

Shipments

Annual Shipments

Residential Furnace 

Fan Lifetime

Total Shipments New

Owners

Historical 

New Owner 

Shipment Data 
99 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

Shipments Model Inputs

Shipments Analysis

Historical Shipments Shipments derived from:

•AHRI historical shipments, 1972-2009, disaggregated into (1) NWGF and MHGF, 

(2) OF, and (3) WGF (estimated from AC packaged units)

•AHRI 1972-2009 historical shipments by efficiency was used to separate 

condensing vs. non-condensing NWGF shipments

•Census MHGF new construction data, MHGF lifetime, AHS saturation data used to 

disaggregate NWGF and MHGF historical shipments

•For EF, DOE’s 2011 furnace standards rulemaking historical shipments

•For hydronic air handlers, DOE estimated that they represented less than 1% of the 

total furnace market.

Replacement Shipments Furnace fan replaced with same furnace fan product class (also accounts for the housing 

units demolished). 

Shipments to New 

Housing

New construction market saturations multiplied by projected new housing units based on:

•Saturations from Characteristics of New Housing data, U.S. Census Bureau

•U.S. Census historical housing starts data and EIA’s AEO2011 projections

Shipments to New 

Owners and Adjustment 

for Product Switching

New owners of products, plus adjustment for switching between different product classes

•Projected shipments developed by estimating the average new owner shipments in 

the past 3-5 years, and projecting this quantity into the future

•Includes households switching between non-condensing and condensing product 

classes

Projected Condensing 

and Non-Condensing 

Market Shares

All NWGF and MHGF furnaces shipments in the north from 2013 onward assumed to be 

condensing furnaces (in the South region, based on historical information, analysis projects 

some market increase of condensing furnaces)
100 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

Shipments Model Inputs: 

Historical Shipments

Shipments Analysis

Historical Shipments of HVAC Products with Furnace Fans
101 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov 

Base Case Shipments 

Shipments Analysis 

Historic & Projected Base Case Shipments of Furnace Fans by Product 

Class 

5 .0 ,---------------------------

4.0 +----_.f. 

-I/) 

c . MHEF 

.2 

3.0 

E . MHGFc 

-I/) • MHGFnc 

-C 

CI> 2.0 E 

Q. 

~ 

CI) 

<0 

<.> 1.0 -. . NWGFc 

0 

-I/) . NWGFnc 

:z: 

0.0 

1990 1995 2000 2005 2010 201 5 2020 2025 2030 2035 2040 2045 
102 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov 

Base Case and Standard Cases Shipments 

Shipments Analysis 

Projected Shipments of Furnaces Fans in the Base Case and Standards 

Cases 

5.0 ,--------------------------------------------------------------

~ 

III 4.5 t: 

.2 

E - Base ~ 

I/) - CSL1 

-

~ 4.0 ----er- CS L2 E 

a. 

~ - CSL3 

(f) 

---CSL4 

3.5 CS 5 

3.0 +--------.--------,--------,-------,,-------,--------.--------, 

2015 2020 2025 2030 2035 2040 2045 2050 
103 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

National Impact Analysis Inputs

National Impact Analysis

Annual Energy 

Consumption per Unit 

(UEC)

For each product class, DOE derived per-unit annual energy 

consumption as a function of product efficiency.

Shipments DOE projected shipments for each product class under the 

base case and all standards cases.

Equipment Stock DOE determined the yearly stock using annual shipments and 

the lifetime for each product class

National Annual Energy 

Consumption

Annual energy consumption is the product of the UEC and the 

equipment stock.

Rebound Effect DOE used a 2009 Wisconsin field study to estimate the 

rebound effect under a standard requiring ECM furnace fans. 

DOE calculated a separate rebound effect for the north and for 

the south regions based on the expected increase of constant 

circulation fan use (20% in the North and 10% in the South). 

Site-to-Source Conversion 

Factor

The site-to-source conversion factor is a factor used for 

converting site energy consumption into primary or source 

energy consumption.
104 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

National Impact Analysis

Request for Comment – Rebound Effect

DOE requests comments on the reasonableness of the values 

that it used to characterize this rebound effect.

Issue 11
105 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

National Impact Analysis

Projected ECM Market Share after 2018

0 %

10%

20%

30%

40%

50%

60%

70%

80%

2000 2010 2020 2030 2040 2050

Shipmnet Weighted ECM Market Share

Year

Based on historical data estimates (10% in 2006 and 30% in 2010) and 

projected market share for 2018 (45%)
106 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

National Impact Analysis

Request for Comment – Furnace Fan Efficiency Trends 

in the Absence of Standards 

DOE requests comments on the reasonableness of its approach 

and information that would support use of alternative 

assumptions.

Issue 13
107 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

(quads)

National Impact Analysis

National Energy Savings Results

Key Product 

Class

Candidate Standard Level

1 2 3 4 5 6 7

Improved 

PSC

PSC w/ 

Controls X13 ECM ECM + BC Impeller

Switching 

Mode Power 

Supply

Toroidal

Transformer

1 NWG-NC 0.022 0.061 0.725 0.624 0.850

2 NWG-C 0.041 0.265 0.623 0.611 0.911

3 WG 0.002 0.019 0.122 0.143 0.200

4 NWO-NC 0.004 0.032 0.042 0.045 0.051

5 EF/MB 0.003 -0.005 0.102 0.085 0.162

6 MH-NWG-NC 0.001 0.010 0.018 0.024 0.026

7 MH-NWG-C 0.001 0.008 0.010 0.017 0.019

8 MH-EF/MB 0.000 0.007 0.013 0.023 0.031

9 HAH-HC 0.000 0.000 0.016 0.030 0.034 0.037 0.039
108 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

Discounted at 3 and 7 Percent (billion 2011$)

National Impact Analysis

Net Present Value Results

Key Product 

Class

Candidate Standard Level

1 2 3 4 5 6 7

Improved 

PSC

PSC w/ 

Controls X13 ECM ECM + BCImpeller

Switching 

Mode Power 

Supply

Toroidal

Transformer

3% 7% 3% 7% 3% 7% 3% 7% 3% 7% 3% 7% 3% 7%

1 NWG-NC 0.110 0.036 0.048 -0.034 4.462 1.553 0.551 -0.278 1.395 -0.077

2 NWG-C 0.254 0.095 1.559 0.564 4.449 1.618 0.089 -0.505 0.944 -0.392

3 WG 0.006 0.002 0.083 0.027 0.842 0.340 0.382 0.081 0.581 0.131

4 NWO-NC 0.023 0.007 0.204 0.070 0.135 0.035 -0.038 -0.049 -0.058 -0.063

5 EF/MB 0.010 0.003 -0.118 -0.059 0.601 0.229 -0.558 -0.343 -0.406 -0.329

6 MH-NWG-NC 0.003 0.001 0.021 0.004 0.044 0.011 -0.060 -0.049 -0.066 -0.054

7 MH-NWG-C 0.005 0.002 0.035 0.013 0.046 0.016 -0.103 -0.067 -0.124 -0.080

8 MH-EF/MB -0.001 -0.001 0.009 -0.001 0.038 0.009 -0.093 -0.072 -0.046 -0.055

9 HAH-HC 0.000 0.000 -0.023 -0.012 0.091 0.031 0.112 0.028 0.132 0.034 0.149 0.040 0.144 0.036
109 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

• DOE has published a Notice of Policy (NOP) stating its 

intention to incorporate full-fuel-cycle (FFC) metrics into 

the cost-benefit analysis. 76 FR 51282 (Aug. 18, 2011). 

• Methodology is based on the calculation of a FFC 

multiplier, or conversion factor, for each of the primary 

fuels used by the product.

• For this preliminary analysis, DOE calculated FFC 

energy savings using a NEMS-based methodology 

(described in appendix 10-B).

• Primary NES and the FFC energy savings for the 

considered CSLs can be found in Ch 10, Section 10.5.2.

Full Fuel Cycle Analysis

National Impact Analysis
110 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

National Impact Analysis

Request for Comment – Full Fuel-Cycle Energy 

Savings 

DOE welcomes comments on its approach to derive FFC 

conversion factors.

Issue 14
111 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

National Impact Analysis

Request for Comment – Other Issues

DOE invites comments and recommendations on any other 

aspects related to the National Impact Analysis.
112 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

Public Meeting Agenda

Markups, Energy Use Characterization, LCC 

and Payback Period Analysis

National Impact Analysis

3

4

2

Engineering Analysis

1 Introduction and Overview

Market and Technology Assessment and 

Screening Analysis

5

6 Preliminary Manufacturer Impact Analysis

7 Next Steps
113 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

Framework

Document

Preliminary

Activities NOPR Final

Rule

Effective

Date

Steps for the Standards Rulemaking: Preliminary 

Activities and Analyses

Shipments 

Analysis

Preliminary 

Manufacturer 

Impact Analysis

Life-Cycle

 Cost and 

 Payback

 Period

 Analyses

National 

Impact 

Analysis

Market & 

Technology 

Assessment

Screening 

Analysis

Engineering

Analysis

Markups to

 Determine 

 Product Price

Energy Use 

Characterization
114 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

• DOE is aware of 11 small business manufacturers associated with 

the products anticipated to be affected by this rulemaking.

• DOE conducted on-site and telephone interviews with 

manufacturers.

• Interview topics included:

– Engineering analysis overview, methodology, and results;

– Key issues (as defined by manufacturer);

– Current market conditions (shipments, market share, product mix, 

profitability);

– Potential impacts of new energy conservation standards (esp. 

conversion costs); and

– Cumulative regulatory burdens (state, federal, international).

Preliminary Manufacturer Impact 

Analysis

Preliminary Manufacturer Impact Analysis (MIA) Overview
115 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

Preliminary Manufacturer Impact 

Analysis

Key Issues

• Higher upfront costs for consumers

– Higher initial costs could lead to consumers switching to less efficient 

products.

– Higher initial costs may also push consumers to repair rather than 

replace units.

• Conversion costs

– Stringent standards may require significant capital conversion costs.

• Reduced innovation

– A new furnace fan standard would take resources away from the 

development of new products.

– A higher standard on furnace fans places new constraints on 

manufacturers and may limit options for maximizing system efficiency. 
116 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

Preliminary Manufacturer Impact 

Analysis

Request for Comment:

Other Issues

DOE requests comment on its identification of key issues and 

requests data that can assist in evaluating the potential impact of 

standards on manufacturers.
117 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

Public Meeting Agenda

Markups, Energy Use Characterization, LCC 

and Payback Period Analysis

National Impact Analysis

3

4

2

Engineering Analysis

1 Introduction and Overview

Market and Technology Assessment and 

Screening Analysis

5

6 Preliminary Manufacturer Impact Analysis

7 Next Steps
118 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

Framework

Document

Preliminary

Activities NOPR Final

Rule

Effective

Date

Next Steps in the Standards Rulemaking: NOPR

Revise 

Preliminary 

Analyses

Trial 

Standard 

Levels

Manufacturer 

Impact 

Analysis

Utility 

Impact 

Analysis

Employment 

Impact 

Analysis

Environ-

 mental 

Assessment

Regulatory 

Impact 

Analysis
119 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

Framework

Document

Preliminary

Activities NOPR Final

Rule

Effective

Date

Next Steps in the Standards Rulemaking: NOPR

Revise 

Preliminary 

Analyses

Trial 

Standard 

Levels

Manufacturer 

Impact 

Analysis

Utility 

Impact 

Analysis

Employment 

Impact 

Analysis

Environ-

 mental 

Assessment

Regulatory 

Impact 

Analysis
120 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

• Purpose:

– To develop a list of potential amended standard levels from which 

impacts are weighed and a proposed standard level is selected.

• Each trial standard level consists of a set of efficiency levels covering all 

product classes, and may vary between product classes.

• NOPR analyses assess impacts for trial standard levels (not efficiency levels 

for each product class).

• Method:

– Trial standard levels are assembled from the product classes and 

efficiency levels identified in the preliminary analyses.

• Trial standard levels cover a range of efficiencies and can include:

– Most energy efficient level (max-tech);

– Efficiency level with the lowest life-cycle cost;

– Efficiency level with a payback period of three years or less;

– Efficiency levels with noteworthy technologies; and

– Efficiency levels that fill in large gaps.

Trial Standard Levels

Selection of Trial Standard Levels
121 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

• A critical part of the NOPR analysis on which DOE is seeking early 

guidance is the criteria used in selecting trial standard levels.

• Trial standard levels are created from combinations of efficiency 

levels at the product class level.

Issues

Request for Comment:

Criteria for the Selection of Trial Standard Levels 

DOE requests feedback on the criteria it should use for basing 

the selection of Trial Standard Levels.
122 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

Framework

Document

Preliminary

Activities NOPR Final

Rule

Effective

Date

Next Steps in the Standards Rulemaking: NOPR

Revise 

Preliminary 

Analyses

Trial 

Standard 

Levels

Manufacturer 

Impact 

Analysis

Utility 

Impact 

Analysis

Employment 

Impact 

Analysis

Environ-

 mental 

Assessment

Regulatory 

Impact 

Analysis
123 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

• Purpose:

– To assess the impacts of standards on residential furnace fan manufacturers.

– To identify and estimate impacts on manufacturer sub-groups that may be more 

severely impacted than the industry as a whole.

• Method:

– Analyze industry cash flow and net present value through use of the Government 

Regulatory Impact Model (GRIM).

– Interview manufacturers to refine inputs to the GRIM, develop sub-group 

analyses, and address qualitative issues.

• Output:

– Industry Net Present Value impacts;

– Sub-group Net Present Value impacts; and

– Other impacts

Manufacturer Impact Analysis

Manufacturer Impact Analysis
124 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

• The MIA consists of three phases:

Manufacturer Impact Analysis Process

* Government Regulatory Impact Model (GRIM)

Phase 1 Phase 3

Manufacturer Impact Analysis

Industry

profile

Develop 

“Strawman”

GRIM*

Develop

interview 

guide

Interviews & 

industry-wide / 

subgroup 

analyses

Assess direct 

employment, 

competition, 

cumulative burden

Finalize 

MIA 

results for 

NOPR

Phase 2
125 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

Framework

Document

Preliminary

Activities NOPR Final

Rule

Effective

Date

Next Steps in the Standards Rulemaking: NOPR

Revise 

Preliminary 

Analyses

Trial 

Standard 

Levels

Manufacturer 

Impact 

Analysis

Utility 

Impact 

Analysis

Employment 

Impact 

Analysis

Environ-

 mental 

Assessment

Regulatory 

Impact 

Analysis
126 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

• Purpose:

– To investigate the effects on utilities from reduced energy sales 

and peak load demand due to potential standards.

• Method:

– Uses national energy savings results.

– Uses the Energy Information Administration’s National Energy 

Modeling System (NEMS) tailored for DOE’s Building 

Technologies Program (NEMS-BT).

• Output:

– Change in energy sales and price by region.

– Change in the mix of electricity generation.

– Change in new capacity construction.

Utility Impact Analysis

Utility Impact Analysis
127 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

Framework

Document

Preliminary

Activities NOPR Final

Rule

Effective

Date

Next Steps in the Standards Rulemaking: NOPR

Revise 

Preliminary 

Analyses

Trial 

Standard 

Levels

Manufacturer 

Impact 

Analysis

Utility 

Impact 

Analysis

Employment 

Impact 

Analysis

Environ-

 mental 

Assessment

Regulatory 

Impact 

Analysis
128 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

• Purpose:

– To report net jobs created or eliminated nationally as a consequence of new 

energy conservation standards.

• Method:

– Uses the ImSET tool, a spreadsheet model of the U.S. economy that focuses on 

188 sectors most relevant to industrial, commercial, and residential building 

energy use.

– Changes in product and energy expenditures taken from the National Impact 

Analysis.

– Estimates the national employment and income effects of energy saving 

appliances.

– Direct employment impacts taken from the Manufacturer Impact Analysis.

• Output:

– Change in employment by sector as a consequence of new standards.

Employment Impact Analysis

Employment Impact Analysis
129 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

Framework

Document

Preliminary

Activities NOPR Final

Rule

Effective

Date

Next Steps in the Standards Rulemaking: NOPR

Revise 

Preliminary 

Analyses

Trial 

Standard 

Levels

Manufacturer 

Impact 

Analysis

Utility 

Impact 

Analysis

Employment 

Impact 

Analysis

Environ-

 mental 

Assessment

Regulatory 

Impact 

Analysis
130 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

• Purpose:

– To report environmental impacts as a consequence of new energy conservation 

standards, including changes in power plant emissions as well as emissions in 

households due to the use of gas appliances. 

• Method:

– Energy savings results taken from the National Impact Analysis.

– Energy Information Administration’s National Energy Modeling System (NEMS) 

provides power-plant emissions.

– ‘In-Building’ emissions due to fossil-fuel fired appliances to be determined using 

emission factors.

– Economic benefits resulting from emissions reductions based on a range of 

monetary values.

• Output:

– Estimate of national emission reductions of SO2, NOx, mercury and CO2.

– Power plant SO2, NOx, and mercury are effectively capped through 

Congressional legislation resulting in little to no emission reductions due to 

standards.

– In-building CO2, SO2 and NOx still emitted by fossil-fuel fired appliances.

Environmental Assessment

Environmental Assessment
131 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

Framework

Document

Preliminary

Activities NOPR Final

Rule

Effective

Date

Next Steps in the Standards Rulemaking: NOPR

Revise 

Preliminary 

Analyses

Trial 

Standard 

Levels

Manufacturer 

Impact 

Analysis

Utility 

Impact 

Analysis

Employment 

Impact 

Analysis

Environ-

 mental 

Assessment

Regulatory 

Impact 

Analysis
132 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

• Purpose:

– To investigate the national impacts due to non-regulatory alternatives compared 

with mandatory energy conservation standards.

– The non-regulatory alternatives that may be considered: 

– No new regulatory action; early replacement; prescriptive standards; consumer 

tax credits; manufacturer tax credits; consumer rebates; voluntary efficiency 

targets; bulk government procurement.

• Method:

– Modify NES spreadsheet model to consider non-regulatory scenarios.

– Non-regulatory scenarios increase overall appliance efficiency and are modeled 

by modifying the base case efficiency trend.

– NPV calculated for non-regulatory alternatives in the same way as for the 

adopted standard.

– Each non-regulatory scenario will decrease national appliance operating costs 

and increase appliance equipment prices.

• Output:

– National Energy Savings and Net Present Value of the non-regulatory 

alternatives.

Regulatory Impact Analysis

Regulatory Impact Analysis
133 | Residential Furnace Fan Energy Conservation Standards eere.energy.gov

DOE requests comments and invites questions from interested 

parties regarding the Department of Energy’s Residential 

Furnace Fans Energy Conservation Standards Rulemaking.

Final Comments and Questions