Yederal Register I Vol. 59. No. 218 I Monday. November 14. 1994 I Proposed Rules 56423

Office of Energy Efficiency and

Renewable Energy

10 CfR Part 430

{Cocket No. EE-RM-94-403]

RIN 1904-AA67

Energy Conservation Program for

Consumer Products: Energy

Conservation Standards for Three

Cleaning Products

.AGENCY: Office of Energy Efficiency and

Renewable Energy. Department of

Energy.

ACTlON: Advance notice of proposed

rulemaking.

SUMMARY: The Energy Policy and

Conservation Act. as amended by the

National Energy Conservation Policy

Act. the National Appliance Energy

Conservation Act. the National

.'\ppliance Energy Conservation

Amendments of 1988 and the Energy

Policy Act of 1992. prescribes energy

conservation standards for certain major

household appliances and requires the

Department of Energy (Department) to

administer an energy conservation

program for these products. Among

other things. the Energy Policy and

Conservation Act. as amended. requires

the Department to consider amending

the energy conservation standards for

dishwashers. clothes washers and

clothes dryers. The purpose of this Advance Notice

of Proposed Rulemaking is to: Present

for comment the product classes that the

Department is planning to analyze;

present a detailed discussion ofthe

analytical methodology and analytical

models that the Department expects to

use in performing analyses in

connection with the proposed rule; and

facilitate the gathering of information

and comments prior to publishing a

subsequent notice of proposed

rulemaking.

DATES: Written comments must be

received by January 30. 1995.

ADDRESSES: Written comments are to be

submitted to: U.S. Department of

Energy. Office of Energy Efficiency and

Renewable Energy. "Energy Efficiency

Standards for Consumer Products,"

(Docket No. EE·RM-94-403). Room 5E066. Forrestal Building. 1000

Independence Avenue. SW.

Washington. DC 20585. (202) 586-7140.

Copies of the public comments

received mav be read at the

Department's Freedom of Information

Reading Room. U.S. Department of

Energy, Forrestal Building. Room lE190.1000 Independence Avenue. SW.

Washington. DC 20585. (202) 586-6020

between the hours of 9:00 a.m. and 4:00

p.m.• Monday through Friday. except

Federal holidays.

For more information concerning

public participation in this rulemaking

proceeding. see section IV, "Public

Comment Procedures." ofthis notice.

FOR FURTHER INFORMATION CONTACT:

P. Marc LaFrance. U.S. Department of

Energy. Office of Energy Efficiency

and Renewable Energy. Forrestal

Building. Mail Station EE-431. 1000

Independence Avenue. SW.. Washington. DC 20585. (202) 586-

7140

Eugene Margolis. Esq.• U.S. Department

of Energy. Office of General Counsel.

Forrestal Building. Mail Station Ge72.1000 Independence Avenue. SW.•

Washington. DC 20585. (202) 586-

9507

SUPPLEMENTARY INFORMATION:

I. Introduction

a. Authority

b. Background

II. Methodology

Ill. Models. Data. and Assumptions

a. Engineering Performance Models and

Costing Analysis

1. Appliance classes

2. Baseline units

3.. Design options

4. Maximum technologically feasible

designs

5. Performance models

6. Costing analysis

7. Price-efficiency relationships

6. Data sources 9. Outputs from the Engineering Analysis

b. Residential Energy Models

1. Lawrence Berkeley Laboratory

Residential Energy Model

2. Residential ~nd-Use Energy Planning

Svstem (REEPS 2.12)

c. Manufacturer Impact Models

1. Conceptual approach

2. Measures of impact

3. Lawrence Berkeley Laboratory

Manufacturer Impact Model

4. Government Regulatory Impact Model

5. Cash-flow analysis of costs due to

standards

6. Data sources

d. Utility Impact Model

e. Sensitivitv Analvses

IV. Public Comment Procedures

a. Participation in Rulemaking

b. Written Comment Procedures

c. Issues for Public Comment

V. Review under Executive Order 12866

I. Introduction

a. Authority

Part B of Title III of the Energy Policy

and Conservation Act. Public Law 94-

163. as amended by the National Energy

Conservation Policy Act. Public Law

95-619. the National Appliance Energy

Conservation Act. Public Law 100-12.

the National Appliance Energy

Conservation Amendments of 1988.

Public Law 100-357. and the Energy

Policy A~ of 1992. Public Law 102-

486.1 created the Energy Conservation

Program for various Consumer Products

other than Automobiles (Program).

Three cleaning products .

(dishwashers. clothes washers. and

clothes dryers) are the subject ofthis

Advance Notice of Proposed

Rulemaking. The National Appliance

Energy Conservation Act of 1987

amended the Act (section 325(g)) to

impose prescriptive standards (design

feature requirements) for the three

cleaning products as part of the energy

conservation program for consumer

products. These design feature

requirements were effective for

appHances manufactured on or after

January 1. 1988. and were as follows:

dishwashers shall be equipped with an

option to dry without heat. clothes

washers shall have an unheated rinse

option. and gas clothes dryers shall not

be equipped with a constant burning

pilot. The Act required the Department

to conduct a rulemaking by January 1.

1990. to determine if the above

mentioned standards should be

amended. The Act provided that any

amendment to the standards would

apply to products manufactured three

years after the rulemaking. The final

rule (56 FR 22279) was issued May 14.

1991. and is effective for products

manufactured on or after May 14. 1994

(hereafter referred to as the May 1991

final rule). The Act also requires the

-Department to conduct a subsequent

rulemaking no later than five years after

the date of publication of the previous

final rule. This second round of

rulemaking is the purpose of today's

notice.

Any new or amended standard is

required to be designed so as to achieve

the maximum improvement in energy

efficiency that is technologically

feasible and economically justified

(section 325(1)(2)(A)).

Section 325(1)(2)(B)(0 of the Act

prOVides that before the Department

determines whether an energy

conservation standard is economically

justified. it must first solicit comments

on the proposed standard. After

reviewing comments on the proposal.

1 Part B ofTitle ill of the Energy P~licy and

Conservation Act. as amended bv the National

Energy Conservation Policy Act:the National

Appliance Energy Conservation Act. the National

Appliance Energy Conservation Amendments of

1988. and the Energy· Policy Act of 1992. is referred

to in this Advance Notice of Proposed Rulemaking

as the "Act:' Part B ofTitle m is codified at42

U.S.c. 6291 et seq. Part B of Title m of the Energy

Policy and Conservation Act. as amended by the

National Energy Conservation Policy Act only. is

referred to as the National Energy Conservation

Policy Act.

 EE-RM-94-403 COMMENT 101C

Yederal Register I Vol. 59. No. 218 I Monday. November 14. 1994 I Proposed Rules 56423 

Office of Energy Efficiency and 

Renewable Energy 

10 CfR Part 430 

{Cocket No. EE-RM-94-403] 

RIN 1904-AA67 

Energy Conservation Program for 

Consumer Products: Energy 

Conservation Standards for Three 

Cleaning Products 

. AGENCY: Office of Energy Efficiency and 

Renewable Energy. Department of 

Energy. 

ACTlON: Advance notice of proposed 

rulemaking. 

SUMMARY: The Energy Policy and 

Conservation Act. as amended by the 

National Energy Conservation Policy 

Act. the National Appliance Energy 

Conservation Act. the National 

.'\ppliance Energy Conservation 

Amendments of 1988 and the Energy 

Policy Act of 1992. prescribes energy 

conservation standards for certain major 

household appliances and requires the 

Department of Energy (Department) to 

administer an energy conservation 

program for these products. Among 

other things. the Energy Policy and 

Conservation Act. as amended. requires 

the Department to consider amending 

the energy conservation standards for 

dishwashers. clothes washers and 

clothes dryers. The purpose of this Advance Notice 

of Proposed Rulemaking is to: Present 

for comment the product classes that the 

Department is planning to analyze; 

present a detailed discussion of the 

analytical methodology and analytical 

models that the Department expects to 

use in performing analyses in 

connection with the proposed rule; and 

facilitate the gathering of information 

and comments prior to publishing a 

subsequent notice of proposed 

rulemaking. 

DATES: Written comments must be 

received by January 30. 1995. 

ADDRESSES: Written comments are to be 

submitted to: U.S. Department of 

Energy. Office of Energy Efficiency and 

Renewable Energy. "Energy Efficiency 

Standards for Consumer Products." 

(Docket No. EE-RM-94-403). Room 5E066. Forrestal Building. 1000 

Independence Avenue. SW. 

Washington. DC 20585. (202) 586-7140. 

Copies of the public comments 

received mav be read at the 

Department's Freedom of Information 

Reading Room. U.S. Department of 

Energy. Forrestal Building. Room lE190.1000 Independence Avenue. SW. 

Washington. DC 20585. (202) 586-6020 

between the hours of 9:00 a.m. and 4:00 

p.m .• Monday through Friday. except 

Federal holidays. 

For more information concerning 

public participation in this rulemaking 

proceeding. see section IV. "Public 

Comment Procedures." of this notice. 

FOR FURTHER INFORMATION CONTACT: 

P. Marc LaFrance. U.S. Department of 

Energy. Office of Energy Efficiency 

and Renewable Energy. Forrestal 

Building. Mail Station EE-431. 1000 

Independence Avenue. SW .. Washington. DC 20585. (202) 586-

7140 

Eugene Margolis. Esq .• U.S. Department 

of Energy. Office of General Counsel. 

Forrestal Building. Mail Station Ge72.1000 Independence Avenue. SW .• 

Washington. DC 20585. (202) 586-

9507 

SUPPLEMENTARY INFORMATION: 

I. Introduction 

a. Authority 

b. Background 

II. Methodology 

III. Models. Data. and Assumptions 

a. Engineering Performance Models and 

Costing Analysis 

1. Appliance classes 

2. Baseline units 

3 .. Design options 

4. Maximum technologically feasible 

deSigns 

5. Performance models 

6. Costing analysis 

7. Price-efficiency relationships 

6. Data sources 9. Outputs from the Engineering Analysis 

b. Residential Energy Models 

1. Lawrence Berkeley Laboratory 

Residential Energy Model 

2. Residential ~nd-Use Energy Planning 

System (REEPS 2.12) 

c. Manufacturer Impact Models 

1. Conceptual approach 

2. Measures of impact 

3. Lawrence Berkeley Laboratory 

Manufacturer Impact Model 

4. Government Regulatory Impact Model 

5. Cash-flow analysis of costs due to 

standards 

6. Data sources 

d. Utility Impact Model 

e. Sensitivitv Analvses 

IV. Public Comment Procedures 

a. Participation in Rulemaking 

b. Written Comment Procedures 

c. Issues for Public Comment 

V. Review under Executive Order 12866 

I. Introduction 

a. Authority 

Part B of Title III of the Energy Policy 

and Conservation Act. Public Law 94-

163. as amended by the National Energy 

Conservation Policy Act. Public Law 

95-619. the National Appliance Energy 

Conservation Act. Public Law 100-12. 

the National Appliance Energy 

Conservation Amendments of 1988. 

Public Law 100-357. and the Energy 

Policy A~ of 1992. Public Law 102-

486.1 created the Energy Conservation 

Program for various Consumer Products 

other than Automobiles (Program). 

Three cleaning products . 

(dishwashers. clothes washers. and 

clothes dryers) are the subject of this 

Advance Notice of Proposed 

Rulemaking. The National Appliance 

Energy Conservation Act of 1987 

amended the Act (section 325(g)) to 

impose prescriptive standards (deSign 

feature requirements) for the three 

cleaning products as part of the energy 

conservation program for consumer 

products. These design feature 

requirements were effective for 

appHances manufactured on or after 

January 1. 1988. and were as follows: 

dishwashers shall be equipped with an 

option to dry without heat. clothes 

washers shall have an unheated rinse 

option. and gas clothes dryers shall not 

be equipped with a constant burning 

pilot. The Act required the Department 

to conduct a rulemaking by January 1. 

1990. to determine if the above 

mentioned standards should be 

amended. The Act provided that any 

amendment to the standards would 

apply to products manufactured three 

years after the rulemaking. The final 

rule (56 FR 22279) was issued May 14. 

1991. and is effective for products 

manufactured on or after May 14. 1994 

(hereafter referred to as the May 1991 

final rule). The Act also requires the 

'Department to conduct a subsequent 

rulemaking no later than five years after 

the date of publication of the previous 

final rule. This second round of 

rulemaking is the purpose of today's 

notice. 

Any new or amended standard is 

required to be designed so as to achieve 

the maximum improvement in energy 

efficiency that is technologically 

feasible and economically justified 

(section 325(l)(2j(A)). 

Section 325(1)(2)(B)(i) of the Act 

prOVides that before the Department 

determines whether an energy 

conservation standard is economically 

justified. it must first solicit comments 

on the proposed standard. After 

reviewing comments on the proposal. 

1 Part B of Title ill of the Energy P~IiCY and 

Conservation Act. as amended bv the National 

Energy Conservation Policy Act: the National 

Appliance Energy Conservation Act. the National 

Appliance Energy Conservation Amendments of 

1988. and the Energy· Policy Act of 1992. is referred 

to in this Advance Notice of Proposed Rulemaking 

as the "Act." Part B of Title m is codified at 42 

U.S.c. 6291 et seq. Part B ofTitle m of the Energy 

Policy and Conservation Act. as amended by the 

National Energy Conservation Policy Act only. is 

referred to as the National Energy Conservation 

Policy Act. 

Yederal Register I Vol. 59. No. 218 I Monday. November 14. 1994 I Proposed Rules 56423 

Office of Energy Efficiency and 

Renewable Energy 

10 CfR Part 430 

{Cocket No. EE-RM-94-403] 

RIN 1904-AA67 

Energy Conservation Program for 

Consumer Products: Energy 

Conservation Standards for Three 

Cleaning Products 

. AGENCY: Office of Energy Efficiency and 

Renewable Energy. Department of 

Energy. 

ACTlON: Advance notice of proposed 

rulemaking. 

SUMMARY: The Energy Policy and 

Conservation Act. as amended by the 

National Energy Conservation Policy 

Act. the National Appliance Energy 

Conservation Act. the National 

.'\ppliance Energy Conservation 

Amendments of 1988 and the Energy 

Policy Act of 1992. prescribes energy 

conservation standards for certain major 

household appliances and requires the 

Department of Energy (Department) to 

administer an energy conservation 

program for these products. Among 

other things. the Energy Policy and 

Conservation Act. as amended. requires 

the Department to consider amending 

the energy conservation standards for 

dishwashers. clothes washers and 

clothes dryers. The purpose of this Advance Notice 

of Proposed Rulemaking is to: Present 

for comment the product classes that the 

Department is planning to analyze; 

present a detailed discussion of the 

analytical methodology and analytical 

models that the Department expects to 

use in performing analyses in 

connection with the proposed rule; and 

facilitate the gathering of information 

and comments prior to publishing a 

subsequent notice of proposed 

rulemaking. 

DATES: Written comments must be 

received by January 30. 1995. 

ADDRESSES: Written comments are to be 

submitted to: U.S. Department of 

Energy. Office of Energy Efficiency and 

Renewable Energy. "Energy Efficiency 

Standards for Consumer Products." 

(Docket No. EE-RM-94-403). Room 5E066. Forrestal Building. 1000 

Independence Avenue. SW. 

Washington. DC 20585. (202) 586-7140. 

Copies of the public comments 

received mav be read at the 

Department's Freedom of Information 

Reading Room. U.S. Department of 

Energy. Forrestal Building. Room lE190.1000 Independence Avenue. SW. 

Washington. DC 20585. (202) 586-6020 

between the hours of 9:00 a.m. and 4:00 

p.m .• Monday through Friday. except 

Federal holidays. 

For more information concerning 

public participation in this rulemaking 

proceeding. see section IV. "Public 

Comment Procedures." of this notice. 

FOR FURTHER INFORMATION CONTACT: 

P. Marc LaFrance. U.S. Department of 

Energy. Office of Energy Efficiency 

and Renewable Energy. Forrestal 

Building. Mail Station EE-431. 1000 

Independence Avenue. SW .. Washington. DC 20585. (202) 586-

7140 

Eugene Margolis. Esq .• U.S. Department 

of Energy. Office of General Counsel. 

Forrestal Building. Mail Station Ge72.1000 Independence Avenue. SW .• 

Washington. DC 20585. (202) 586-

9507 

SUPPLEMENTARY INFORMATION: 

I. Introduction 

a. Authority 

b. Background 

II. Methodology 

III. Models. Data. and Assumptions 

a. Engineering Performance Models and 

Costing Analysis 

1. Appliance classes 

2. Baseline units 

3 .. Design options 

4. Maximum technologically feasible 

deSigns 

5. Performance models 

6. Costing analysis 

7. Price-efficiency relationships 

6. Data sources 9. Outputs from the Engineering Analysis 

b. Residential Energy Models 

1. Lawrence Berkeley Laboratory 

Residential Energy Model 

2. Residential ~nd-Use Energy Planning 

System (REEPS 2.12) 

c. Manufacturer Impact Models 

1. Conceptual approach 

2. Measures of impact 

3. Lawrence Berkeley Laboratory 

Manufacturer Impact Model 

4. Government Regulatory Impact Model 

5. Cash-flow analysis of costs due to 

standards 

6. Data sources 

d. Utility Impact Model 

e. Sensitivitv Analvses 

IV. Public Comment Procedures 

a. Participation in Rulemaking 

b. Written Comment Procedures 

c. Issues for Public Comment 

V. Review under Executive Order 12866 

I. Introduction 

a. Authority 

Part B of Title III of the Energy Policy 

and Conservation Act. Public Law 94-

163. as amended by the National Energy 

Conservation Policy Act. Public Law 

95-619. the National Appliance Energy 

Conservation Act. Public Law 100-12. 

the National Appliance Energy 

Conservation Amendments of 1988. 

Public Law 100-357. and the Energy 

Policy A~ of 1992. Public Law 102-

486.1 created the Energy Conservation 

Program for various Consumer Products 

other than Automobiles (Program). 

Three cleaning products . 

(dishwashers. clothes washers. and 

clothes dryers) are the subject of this 

Advance Notice of Proposed 

Rulemaking. The National Appliance 

Energy Conservation Act of 1987 

amended the Act (section 325(g)) to 

impose prescriptive standards (deSign 

feature requirements) for the three 

cleaning products as part of the energy 

conservation program for consumer 

products. These design feature 

requirements were effective for 

appHances manufactured on or after 

January 1. 1988. and were as follows: 

dishwashers shall be equipped with an 

option to dry without heat. clothes 

washers shall have an unheated rinse 

option. and gas clothes dryers shall not 

be equipped with a constant burning 

pilot. The Act required the Department 

to conduct a rulemaking by January 1. 

1990. to determine if the above 

mentioned standards should be 

amended. The Act provided that any 

amendment to the standards would 

apply to products manufactured three 

years after the rulemaking. The final 

rule (56 FR 22279) was issued May 14. 

1991. and is effective for products 

manufactured on or after May 14. 1994 

(hereafter referred to as the May 1991 

final rule). The Act also requires the 

'Department to conduct a subsequent 

rulemaking no later than five years after 

the date of publication of the previous 

final rule. This second round of 

rulemaking is the purpose of today's 

notice. 

Any new or amended standard is 

required to be designed so as to achieve 

the maximum improvement in energy 

efficiency that is technologically 

feasible and economically justified 

(section 325(l)(2j(A)). 

Section 325(1)(2)(B)(i) of the Act 

prOVides that before the Department 

determines whether an energy 

conservation standard is economically 

justified. it must first solicit comments 

on the proposed standard. After 

reviewing comments on the proposal. 

1 Part B of Title ill of the Energy P~IiCY and 

Conservation Act. as amended bv the National 

Energy Conservation Policy Act: the National 

Appliance Energy Conservation Act. the National 

Appliance Energy Conservation Amendments of 

1988. and the Energy· Policy Act of 1992. is referred 

to in this Advance Notice of Proposed Rulemaking 

as the "Act." Part B of Title m is codified at 42 

U.S.c. 6291 et seq. Part B ofTitle m of the Energy 

Policy and Conservation Act. as amended by the 

National Energy Conservation Policy Act only. is 

referred to as the National Energy Conservation 

Policy Act. 
56424 Federal Register I Vol. 59. No. 218 I Monday. November 14. 1994 I Proposed Rul~s

the Department must then detennine

that the benefits of the standard exceed

its burdens. based to the greatest extent

practicable. on a weighing ofthe

following seven factors:

(1) The economic impact ofthe

standard on the manufacturers and on

the consumers of the products subject to

such standard;

(2) The savings in operating costs

throughout the estimated average life of '

the covered product in the type (or

class) compared to any increase in the

price. initial charges. or maintenahce

expenses for the covered products that

are likely to result directly from the

imposition of the standard;

(3) The total projected amount of

energy savings likely to result directly

from the imposition ofthe standard;

(4) Any lessening of the utility or the

performance of the covered products

likelv to result from the imposition of

the standard;

(5) The impact of any lessening of

competition. as detennined in writing

by the Attorney General. that is likely to

result from the imposition of the

standard;

(6) The need for national energy

conservation; and

(7) Other factors the Secretary

considers relevant.

b. Background

The Department conducted the first

rulemaking to detennine ifthe

standards (design feature requirements)

imposed by the Act should be amended.

The Department published an Advance

Notice of Proposed Rulemaking (53 FR

17712. Mav 18. 1988). a Notice of

Proposed Rulemaking (54 FR 32744.

i).ugust 9.1989). and the May 1991 final

rule, The May 1991 final rule imposed

energy conservation standards for the

cleaning products which are based on

perfonnance. The standards specify a

minimum energy factor for both classes

of dishwashers (Standard and Compact).

Two of the five classes of clothes

washers (Top-loading Standard and

Top-luading Compact) and four of the

five classes of clothes dryers (Electric

Standard. Electric Compact (120v),

Electric Compact (240v). and Gas

Standard) are subject to a minimum

energy factor while the remaining

classes are sabject to design feature

requirements. The May 1991 final rule

energy conservation standards are

effective for products manufactured on

or after May 14, 1994.

'In the Mav 1991 final rule. the

Deoartment'announced that it \\'as

accelerating the second review of energy

efficiencv standards for clothes washers

because it became aware of a design

option (horizontal-axis wash tub in a

top-loading washer) in use in Europe

that was not included in the proposed

rule and upon which no comment was

received. The Department did not

consider establishing a standard based

on the top-loading horizontal-axis

design option because this infonnation

came to the attention ofthe Department

after the close ofthe comment period on

the proposed rule and thus was not

subject to public debate. The

Department published an Advance

Notice of Proposed Rulemaking (55 FR

39624. September 28. 1990. "nine

product rulemaking") which announCed

the acceleration ofthe second review of

energy efficiency standards for clothes

washers. In response to that notice. a

number of energy efficiency advocates

and appliance manufacturers requested

that the Department delay the second

review until 1995-1996. The additional

time was requested in order to allow

manufacturers time to implement the

standards imposed by the May 1991

final rule and to fully evaluate new.

more energy efficient technologies such

as top-loading horizontal-axis clothes

washers. This additional time,

manufacturers contended. would enable

them to provide more meaningful and

relevant comments on the next.

legislatively required rolemaking. The

Department considered the request. and

by letter. dated February 26, 1992.

notified the parties requesting the delay

that the Department had determined

that it would conduct the rulemaking on

the later schedule, as requested.

Today's Advance Notice of Proposed

Rulemaking includes clothes washers.

Comments previously received for the

September 28.1990. Advance Notice of

Proposed Rulemaking relative to clothes

washers will be considered and

addressed in the Department's Notice of

Proposed Rulemaking. Those who

submitted previous comments have the .option of maintaining their previously

submitted comments. amending

previous comments. or withdrawing

their previous comments and submitting

new comments. The Department will

address all applicable comments in the

Notice of Proposed Rulemaking.

Presently. the Department also is

conducting a rulemaking on three types

of consumer products (central air

conditioners and central air

conditioning heat pumps; furnaces; and

refrigerators. refrigerator-freezers. and

freezers) which was initiated by the

publication of a Advance Notice of

Proposed Rulemaking. (58 FR 47326.

Sept. 8.1993) (hereafter refen-ed to as

the Three Product Advance Notice). The

Three Product Advance Notice has a

detailed discussion on numerous crosscutting policy and methodological

issues. These issues include discount

rates. environmental externalities.

manufacturer impact analysis,

incremental analvsis and infonnation on

any identifiable groups or consumers

who may be disproportionally affected

by any proposed national energy

efficiency standard levels. The

Department proposeslo US8' the same

analytical methods in all efficiency

standard rulemakings and. therefore. the

decisions on many ofthese cross-cutting

issues tPat emerge from other

rulemaking processes. such as the Three

Product Advance Notice. are likely to be

reflected in the proposed standards that

will follow this Advance Notice. ' The Department is developing a

general test procedure revision which

will address previously granted waivers.

add future testing criteria and provide

test procedure clarity. This planned

revision will not change the energy

consumption reporting of any product

models and will be promulgated prior to

the effective date of anv new standards

from this rulemaking. .

II. Methodology

This section provides a brief

description of the analyses to be used to

determine the impacts of the standards.

It offers an overview of the analytic

methodology and discusses the major

components ofthe analyses: the

Engineering Analysis, the Manufacturer

Analysis. the Consumer Analysis. and

the Utility Analysis.

This section also discusses the

interrelationships among the

components that ensure consistencv

throughout the analyses. . The next section. Models. Data and

Assumptions. describes the computer

models used in the analyses. The

models predict the anticipated response

of consumers, manufacturers. and

utilities to future changes in the

economy. including the imposition of

energy conservation standards.

Quantitative estimates ofthe impacts of

standards will be calculated from the

outputs from the models. The models

that will be utilized in the analvses are: • EngineeringPerfonnance Models. • Consumer Impact Models. • Manufacturer Impact Models. and • Utility Impact Model.

The function. data sources.

assumptions and validity of the results

for each model are discussed below.

The overall impact of appliance

conservation standards on energy use.

consumers. manufacturers. and other·

factors will be detennined by comparin~

projections under the base case 2 with

'The base ca5e assumes implementation of t!:P.

conservation standards that were E.et bv Ine

Department of E::crgy in the May 1991 final n;'".

 EE-RM-94-403 COMMENT 101C

56424 Federal Register I Vol. 59. No. 218 I Monday. November 14, 1994 I Proposed Rul~s 

the Department must then detennine 

that the benefits of the standard exceed 

its burdens. based to the greatest extent 

practicable. on a weighing of the 

following seven factors: 

(1) The economic impact of the 

standard on the manufacturers and on 

the consumers of the products subject to 

such standard; 

(2) The savings in operating costs 

throughout the estimated average life of ' 

the covered product in the type (or 

class) compared to any increase in the 

price. initial charges. or maintenahce 

expenses for the covered products that 

are likely to result directly from the 

imposition of the standard; 

(3) The total projected amount of 

energy savings likely to result directly 

from the imposition of the standard; 

(4) Any lessening of the utility or the 

performance of the covered products 

likelv to result from the imposition of 

the standard; 

(5) The impact of any lessening of 

competition. as detennined in writing 

by the Attorney General. that is likely to 

result from the imposition of the 

standard; 

(6) The need for national energy 

conservation; and 

(7) Other factors the Secretary 

considers relevant. 

b, Background 

The Department conducted the first 

rulemaking to detennine if the 

standards (design feature requirements) 

imposed by the Act should be amended. 

The Department published an Advance 

Notice of Proposed Ruiemaking (53 FR 

17712. Mav 18. 1988). a Notice of 

Proposed Rulemaking (54 FR 32744. 

l).ugust 9.1989). and the May 1991 final 

ruie, The May 1991 final rule imposed 

energy conservation standards for the 

cleaning products which are based on 

perfonnance. The standards specify a 

minimum energy factor for both classes 

of dishwashers (Standard and Compact). 

Two of the five classes of clothes 

washers (Top-loading Standard and 

Top-luading Compact) and four of the 

five classes of clothes dryers (Electric 

Standard. Electric Compact (120v). 

Electric Compact (240v), and Gas 

Standard) are subject to a minimum 

energy factor while the remaining 

classes are sabject to design feature 

requirements. The May 1991 final rule 

energy conservation standards are 

effective for products manufactured on 

or after May 14, 1994. 

'In the Mav 1991 final rule. the 

Deoanment'announced that it \\'as 

accelerating the second review of energy 

efficiencv standards for clothes washers 

because it became aware of a design 

option (horizontal-axis wash tub in a 

top-loading washer) in use in Europe 

that was not included in the proposed 

rule and upon which no comment was 

received. The Department did not 

consider establishing a standard based 

on the top-loading horizontal-axis 

design option because this infonnation 

came to the attention of the Department 

after the close of the comment period on 

the proposed rule and thus was not 

subject to public debate. The 

Department published an Advance 

Notice of Proposed Rulemaking (55 FR 

39624. September 28, 1990. "nine 

product rulemaking") which announCed 

the acceleration of the second review of 

energy efficiency standards for clothes 

washers. In response to that notice, a 

number of energy efficiency advocates 

and appliance manufacturers requested 

that the Department delay the second 

review until 1995-1996. The additional 

time was requested in order to allow 

manufacturers time to implement the 

standards imposed by the May 1991 

final rule and to fully evaluate new. 

more energy efficient technologies such 

as top-loading horizontal-axis clothes 

washers. This additional time, 

manufacturers contended. would enable 

them to provide more meaningful and 

relevant comments on the next, 

legislatively required rulemaking. The 

Department considered the request. and 

by letter. dated February 26, 1992. 

notified the parties requesting the delay 

that the Department had determined 

that it would conduct the rulemaking on 

the later schedule, as requested. 

Today's Advance Notice of Proposed 

Rulemaking includes clothes washers. 

Comments previously received for the 

September 28.1990, Advance Notice of 

Proposed Rulemaking relative to clothes 

washers will be considered and 

addressed in the Department's Notice of 

Proposed Rulemaking. Those who 

submitted previous comments have the . option of maintaining their previously 

submitted comments. amending 

previous comments. or withdrawing 

their previous comments and submitting 

new comments. The DepartInent will 

address all applicable comments in the 

Notice of Proposed Rulemaking. 

Presently. the Department also is 

conducting a rulemaking on three types 

of consumer products (central air 

conditioners and central air 

conditioning heat pumps; furnaces; and 

refrigerators, refrigerator-freezers. and 

freezers) which was initiated by the 

publication of a Advance Notice of 

Proposed Rulemaking. (58 FR 47326. 

Sept. 8.1993) (hereafter refen-ed to as 

the Three Product Advance Notice). The 

Three Product Advance Notice has a 

detailed discussion on numerous crosscutting policy and methodological 

issues. These issues include discount 

rates, environmental externalities. 

manufacturer impact analysis. 

incremental analvsis and infonnation on 

any identifiable groups or consumers 

who may be disproportionally affected 

by any proposed national energy 

efficiency standard levels. The 

Department proposes.lo US8'the same 

analytical methods in all efficiency 

standard rulemakings and, therefore. the 

decisions on many of these cross-cutting 

issues tj:lat emerge from other 

rulemaking processes, such as the Three 

Product Advance Notice. are likely to be 

reflected in the proposed standards that 

will follow this Advance Notice. ' 

The Department is developing a 

general test procedure revision which 

will address previously granted waivers. 

add future testing criteria and provide 

test procedure clarity. This planned 

revision will not change the energy 

consumption reporting of any product 

models and will be promulgated prior to 

the effective date of anv new standards 

from this rulemaking. -

II. Methodology 

This section provides a brief 

description of the analyses to be used to 

determine the impacts of the standards. 

It offers an overview of the analytic 

methodology and discusses the major 

components of the analyses: the 

Engineering Analysis, the Manufacturer 

Analysis. the Consumer Analysis. and 

the Utility Analysis. 

This section also discusses the 

interrelationships among the 

components that ensure consistencv 

throughout the analyses. " 

The next section. Models, Data and 

Assumptions. describes the computer 

models used in the analyses. The 

models predict the anticipated response 

of consumers. manufacturers. and 

utilities to future changes in the 

economy, including the imposition of 

energy conservation standards. 

Quantitative estimates of the impacts of 

standards will be calculated from the 

outputs from the models. The models 

that will be utilized in the analvses are: • EngineeringPerfonnance Models, • Consumer Impact Models. • Manufacturer Impact Models. and • Utility Impact Model. 

The function. data sources, 

assumptions and validity of the results 

for each model are discussed below. 

The overall impact of appliance 

conservation standards on energy use. 

consumers. manufacturers. and other· 

factors will be detennined by comparin~ 

projections under the base case 2 with 

'The base ca5e assumes implementation of 1!:P. 

conservation standards that were E.et bv tne 

Department oi E::crgy in the May 1991 final n;I ... 

56424 Federal Register I Vol. 59. No. 218 I Monday. November 14, 1994 I Proposed Rul~s 

the Department must then detennine 

that the benefits of the standard exceed 

its burdens. based to the greatest extent 

practicable. on a weighing of the 

following seven factors: 

(1) The economic impact of the 

standard on the manufacturers and on 

the consumers of the products subject to 

such standard; 

(2) The savings in operating costs 

throughout the estimated average life of ' 

the covered product in the type (or 

class) compared to any increase in the 

price. initial charges. or maintenahce 

expenses for the covered products that 

are likely to result directly from the 

imposition of the standard; 

(3) The total projected amount of 

energy savings likely to result directly 

from the imposition of the standard; 

(4) Any lessening of the utility or the 

performance of the covered products 

likelv to result from the imposition of 

the standard; 

(5) The impact of any lessening of 

competition. as detennined in writing 

by the Attorney General. that is likely to 

result from the imposition of the 

standard; 

(6) The need for national energy 

conservation; and 

(7) Other factors the Secretary 

considers relevant. 

b, Background 

The Department conducted the first 

rulemaking to detennine if the 

standards (design feature requirements) 

imposed by the Act should be amended. 

The Department published an Advance 

Notice of Proposed Ruiemaking (53 FR 

17712. Mav 18. 1988). a Notice of 

Proposed Rulemaking (54 FR 32744. 

l).ugust 9.1989). and the May 1991 final 

ruie, The May 1991 final rule imposed 

energy conservation standards for the 

cleaning products which are based on 

perfonnance. The standards specify a 

minimum energy factor for both classes 

of dishwashers (Standard and Compact). 

Two of the five classes of clothes 

washers (Top-loading Standard and 

Top-luading Compact) and four of the 

five classes of clothes dryers (Electric 

Standard. Electric Compact (120v). 

Electric Compact (240v), and Gas 

Standard) are subject to a minimum 

energy factor while the remaining 

classes are sabject to design feature 

requirements. The May 1991 final rule 

energy conservation standards are 

effective for products manufactured on 

or after May 14, 1994. 

'In the Mav 1991 final rule. the 

Deoanment'announced that it \\'as 

accelerating the second review of energy 

efficiencv standards for clothes washers 

because it became aware of a design 

option (horizontal-axis wash tub in a 

top-loading washer) in use in Europe 

that was not included in the proposed 

rule and upon which no comment was 

received. The Department did not 

consider establishing a standard based 

on the top-loading horizontal-axis 

design option because this infonnation 

came to the attention of the Department 

after the close of the comment period on 

the proposed rule and thus was not 

subject to public debate. The 

Department published an Advance 

Notice of Proposed Rulemaking (55 FR 

39624. September 28, 1990. "nine 

product rulemaking") which announCed 

the acceleration of the second review of 

energy efficiency standards for clothes 

washers. In response to that notice, a 

number of energy efficiency advocates 

and appliance manufacturers requested 

that the Department delay the second 

review until 1995-1996. The additional 

time was requested in order to allow 

manufacturers time to implement the 

standards imposed by the May 1991 

final rule and to fully evaluate new. 

more energy efficient technologies such 

as top-loading horizontal-axis clothes 

washers. This additional time, 

manufacturers contended. would enable 

them to provide more meaningful and 

relevant comments on the next, 

legislatively required rulemaking. The 

Department considered the request. and 

by letter. dated February 26, 1992. 

notified the parties requesting the delay 

that the Department had determined 

that it would conduct the rulemaking on 

the later schedule, as requested. 

Today's Advance Notice of Proposed 

Rulemaking includes clothes washers. 

Comments previously received for the 

September 28.1990, Advance Notice of 

Proposed Rulemaking relative to clothes 

washers will be considered and 

addressed in the Department's Notice of 

Proposed Rulemaking. Those who 

submitted previous comments have the . option of maintaining their previously 

submitted comments. amending 

previous comments. or withdrawing 

their previous comments and submitting 

new comments. The DepartInent will 

address all applicable comments in the 

Notice of Proposed Rulemaking. 

Presently. the Department also is 

conducting a rulemaking on three types 

of consumer products (central air 

conditioners and central air 

conditioning heat pumps; furnaces; and 

refrigerators, refrigerator-freezers. and 

freezers) which was initiated by the 

publication of a Advance Notice of 

Proposed Rulemaking. (58 FR 47326. 

Sept. 8.1993) (hereafter refen-ed to as 

the Three Product Advance Notice). The 

Three Product Advance Notice has a 

detailed discussion on numerous crosscutting policy and methodological 

issues. These issues include discount 

rates, environmental externalities. 

manufacturer impact analysis. 

incremental analvsis and infonnation on 

any identifiable groups or consumers 

who may be disproportionally affected 

by any proposed national energy 

efficiency standard levels. The 

Department proposes.lo US8'the same 

analytical methods in all efficiency 

standard rulemakings and, therefore. the 

decisions on many of these cross-cutting 

issues tj:lat emerge from other 

rulemaking processes, such as the Three 

Product Advance Notice. are likely to be 

reflected in the proposed standards that 

will follow this Advance Notice. ' 

The Department is developing a 

general test procedure revision which 

will address previously granted waivers. 

add future testing criteria and provide 

test procedure clarity. This planned 

revision will not change the energy 

consumption reporting of any product 

models and will be promulgated prior to 

the effective date of anv new standards 

from this rulemaking. -

II. Methodology 

This section provides a brief 

description of the analyses to be used to 

determine the impacts of the standards. 

It offers an overview of the analytic 

methodology and discusses the major 

components of the analyses: the 

Engineering Analysis, the Manufacturer 

Analysis. the Consumer Analysis. and 

the Utility Analysis. 

This section also discusses the 

interrelationships among the 

components that ensure consistencv 

throughout the analyses. " 

The next section. Models, Data and 

Assumptions. describes the computer 

models used in the analyses. The 

models predict the anticipated response 

of consumers. manufacturers. and 

utilities to future changes in the 

economy, including the imposition of 

energy conservation standards. 

Quantitative estimates of the impacts of 

standards will be calculated from the 

outputs from the models. The models 

that will be utilized in the analvses are: • EngineeringPerfonnance Models, • Consumer Impact Models. • Manufacturer Impact Models. and • Utility Impact Model. 

The function. data sources, 

assumptions and validity of the results 

for each model are discussed below. 

The overall impact of appliance 

conservation standards on energy use. 

consumers. manufacturers. and other· 

factors will be detennined by comparin~ 

projections under the base case 2 with 

'The base ca5e assumes implementation of 1!:P. 

conservation standards that were E.et bv tne 

Department oi E::crgy in the May 1991 final n;I ... 
f'ederal Register / Vol. 59. No. 218'/ Monday. November 14. 1994 I Proposed Rules 56425

the projections u....lder the proposed

standards and. perhaps. by comparing

the projections of various proposed

standards. The possible comparison of

different standard cases was one of the

issues raised in t.'1.e Three Product

Advance Notice. The analysis method

chosen. based on the review of public

comments on this earlier notice. as weH

as. comments received in response to

today's notice. will be used in the .

development of the proposed standards

for the products addressed by this

Advance Notice.

The analysis that will be performed is

made up of the follO\I.'ing items: • An Engineering Analysis that

establishes the technical feasibility and

product attributes. mcluding costs of

design options. to improve appliance

efficiency.

• A Manufacturer Analysis that

pro\'ides an estimate of manufacturers'

responses to the proposed standards.

Their responses are quantified by

changes in several financial

performance measures. such as pricing.

output and profitability etc.

• A Consumer Analysis that forecasts

appliance sales. efficiencies. energy use.

consumer expenditures. and the

national net benefits and costs and a

separate Life Cycle Cost Analysis to

evaluate the purchaser's savings in

operating expenses relath'e to increases

in purchase price.

• A Utility Analysis that measures the

projected impacts of the altered energ.yconsumption patterns on electric and

gas utilities. . Each analysis area will be performed

for each of the three products under

consideration. The results of the

Engineering Analysis will be reviewed

by t.'1.e Department to determine whether

standards for each product could yield

measurable energy savings. Ifstandards

would not yield energy savings. then the

analysis will be terminated. If energy

sa\ings are possible. then a detailed

analysis is performed.

There is interaction among the

Engineering. Consumer. Utility, and

Manufacturer Analvses. The

Engineering Analysis examines

appliance designs and related attributes

such as efficiency and costs. Based on

the relationships between the prices and

efficiencies of design options. the

Consumer Analysis forecasts sales and

efficiencies of new and replacement

appliances. These data are used as

inputs to the Manufacturer Analysis to

determine the financial impacts on

prototypical firms within the industry.

The Consumer Analvsis forecasts

national aggregme energy savings and

consumer expenditures associated with

the purchase and operation of the

appliances. Consumer expenditures

(both purchase and operation) are

employed in the Life-Cycle Cost

Analysis to determine consumer

impacts. Changes in sales. revenues.

investments. and marginal costs of

utilities are calculated from the energy

savings in the Utility Analysis.

Three periods oftime are used in the

analyses. First. the Engineering Analysis

examines the technical feasibility of

improving the.efficiency of the covered

products by analyzing design options

available today to improve product

efficiency. whether they are '

commercially available or prototypes.

Second. the Manufacturer Analvsis is

performed for a typical year after the

standards are assumed to have heen

imposed. Typically. the fifth year is

selected. so all major impacts of a

standard would have occurred. Third.

the Consumer Analysis examines

impacts o'.er a time period at least as

long as the average lifetimes of the

products.

III. Models. Data. and Assumptions

a. Engineering Performance Models and

Costing Analysis

The Engineering Analysis addresses

two statutory requirements. The first

requirement is that the Department

consider only improvements in energy

efficiency that are technologically

feasible. The second is that the

Department consider any lessening of

utility to the consumer due to the

imposition ofstandards. In addition. the

Engineering Analysis provides

information on efficiencies, energy

consumption. manufacturing costs. and

maintenance and installation costs for use in the other analyses.

The Engineering Analysis develops

cost and efficiency data for a set of

design options withm each appliance

class. These data are the output of the

engineering performance models and

costing analysis discussed in

subsections 5-9. below.

1. Appliance Classes

The first step in the Engineering

Analysis is to segregate product types

into separate classes to which different

energy conservation standards apply.

Classes are differentiated by the type of

energy use (oil. natural gas. or

electricity) or capacity or performancerelated features that provide utility to

the consumer and affect efficiency.

Classes are differentiated in order to

ensure that consumer products having

different capacities or other

performance-related features affecting

efficiency and utility remain available to consumers.

For each of the three appliances. the

follOWing are the classes that the

Department proposes to consider. The

Department welcomes comments on the

proposed classes.

(i) Dishwashers

Compact Dishwasher (less than 22

. inches in exterior width)

Standard Dishwasher (equal to or

greater than 22 inches in eXlerior

\\'idth)

(ii) Clothes Washers

Compact (less than 1.6 ft 3 capacity)

Standard (1.6 ft 3 or greater capacity)

(iii) Clothes Dryers

Electric. Standard (4.4 ft 3 or greater

capacity)

Electric. Compact. 120\' (less than 4.4

ft 3 capacity)

Electric. Compact. 240v (less than 4.4

ft 3 capacity)

Gas. Standard (4.4 ft 3 or greater

capacity) .

Gas. Compact (less than 4.4 ft 3 capacityl

In the case of clothes washers. the

Department is proposing to eliminate

certain previously defined

classifications (Semi-Automatic TopLoading. Front-Loading and Suds

Saving) because they do not offer any

added utility which is inherently less

energy efficient and therefore would

require protection from the energy

conservation standards. In the May 1991

final rule. these classes were not subject

to a minimum energy conservation

standard imposed because they

represented a small portion of the

market. and due to a lack of adequate

information the Department did not

analyze them. However. the 1988

standard requiring an unheated rinse

option is still applicable to these

classes. The Department has further

reviewed this topic and believes that

these products should be subject to the

minimum energy conservation

standards applicable to either compact

or standard clothes washers. The

Department welcomes comments on this

issue.

2. Baseline Units

For the purpose of generating a cost!

efficiency relationship, the Engineenng

Analysis needs to define a starting point

or baseline. The assumed baseline unit

is to represent a typical model within an

appliance class sold during the initial

year of the analysis. e.g.. a unit that

minimally exceeds the existing

standard. Once identified. each baseline

J The energy factor is a n:easurement of energy

efficiency derh'ed from the DepanmE'n! of Energ,

lest procedure for that product.

 EE-RM-94-403 COMMENT 101C

F'ederal Register I Vol. 59. No. 218', Monday. November 14. 1994 , Proposed Rules 56425 

the projections uIlder the proposed 

standards and. perhaps. by comparing 

the projections of various proposed 

standards. The possible comparison of 

different standard cases was one of the 

issues raised in t.'1.e Three Product 

Advance Notice. The analysis method 

chosen. based on the review of public 

comments on this earlier notice. as weH 

as. comments receh'ed in response to 

today's notice. will be used in the . 

development of the proposed standards 

for the products addressed by this 

Advance Notice. 

The analysis that will be performed is 

made up of the foUO\\,'ing items: 

• An Engineering Analysis that 

establishes the technical feasibility and 

product attributes. mcluding costs of 

design options. to improve appliance 

efficiency. 

• A Manufacturer Anaiysis that 

pro\'ides an estimate of manufacturers' 

responses to the proposed standards. 

Their responses are quantified by 

changes in several financial 

performance measures. such as pricing. 

output and profitability etc. 

• A Consumer AnalYsis that forecasts 

appliance sales. efficiencies. energy use. 

consumer expenditures. and the 

national net benefits and costs and a 

separate Life Cycle Cost Ana1ysis to 

evaluate the purchaser's savings in 

operating expenses relath'e to increases 

in purchase price. 

• A Utility Analysis that measures the 

projected impacts of the altered energ.yconsumption patterns on electric and 

gas utili ties. . Each analysis area wiil be performed 

for each of the three products under 

consideration. The results of the 

Engineering Analysis will be reviewed 

by tb.e Department to determine whether 

standards for each product could yield 

measurable energy savings. If standards 

would not yield energy savings. then the 

analysis will be terminated. If energy 

sa\ings are possible. then a detailed 

analysis is performed. 

There is interaction among the 

Engineering. Consumer. Utility. and 

Manufacturer Analyses. The 

Engineering Analysis examines 

appliance designs and related attributes 

such as efficiency and costs. Based on 

the relationships between the prices and 

efficiencies of design options. the 

Consumer Analysis forecasts sales and 

efficiencies of new and replacement 

appliances. These data are used as 

inputs to the Manufacturer Analysis to 

determine the financial impacts on 

prototypical firms within the industry. 

The Consumer Analvsis forecasts 

national aggregate energy savings and 

consumer expenditures associated with 

the purchase and operation of the 

appliances. Consumer expenditures 

(both purchase and operation) are 

employed in the Life-Cycle Cost 

Analysis to determine consumer 

impacts. Changes in sales. revenues. 

investments. and marginal costs of 

utilities are calculated from the energy 

savings in the Utility Analysis. 

Three periods of time are used in the 

analyses. First. the Engineering Analysis 

examines the technical feasibility of 

improving the.efficiency of the covered 

products by analyzing design options 

available today to improve product 

efficiency. whether they are . 

commercially available or prototypes. 

Second. the Manufacturer Analvsis is 

performed for a typical year after the 

standards are assumed to have been 

imposed. Typically. the fifth year is 

selected. so all major impacts of a 

standard would have occurred. Third. 

the Consumer Analysis examines 

impacts o'.er a time period at least as 

long as the average lifetimes of the 

products. 

III. Models. Data. and Assumptions 

a. Engineering Performance Models and 

Costing Analysis 

The Engineering Anairsis addresses 

two statutory requirements. The first 

requirement is that the Department 

consider only improvements in energy 

efficiency that are technologically 

feasible. The second is that the 

Department consider any lessening of 

utility to the consumer due to the 

imposition of standards. In addition. the 

Engineering Analysis provides 

information on efficiencies, energy 

consumption. manufacturing costs. and 

maintenance and installation costs for 

use in the other analyses. 

The Engineering Analysis develops 

cost and efficiency data for a set of 

design options withm each appliance 

class. These data are the output of the 

engineering performance models and 

costing analysis discussed in 

subsections 5-9. below. 

1. Appliance Classes 

The first step in the Engineering 

Analysis is to segregate product types 

into separate classes to which different 

energy conservation standards apply. 

Classes are differentiated by the type of 

energy use (oil. natural gas. or 

electricity) or capacity or performancerelated features that provide utility to 

the consumer and affect efficiency. 

Classes are differentiated in order to 

ensure that consumer products having 

different capacities or other 

performance-related features affecting 

efficiency and utility remain available to 

consumers. 

For each of the three appliances. the 

follOWing are the classes that the 

Department proposes to consider. The 

Department welcomes comments on the 

proposed classes. 

(i) Dishwashers 

Compact Dishwasher (less than 22 

. inches in exterior width) 

Standard Dishwasher (equal to or 

greater than 22 inches in exterior 

\\'idth) 

(ii) Clothes Washers 

Compact (less than 1.6 ft 3 capacity) 

Standard (1.6 ft 3 or greater capacity) 

(iii) Clothes Dryers 

Electric. Standard (4.4 ft 1 or greater 

capacity) 

Electric. Compact. 120\' (less than 4.4 

ft 3 capacity) 

Electric. Compact. 240v (less than 4.4 

ft 3 capacity) 

Gas. Standard (4.4 ft 3 or greater 

capacity) . 

Gas, Compact (less than 4.4 ft 3 capacityl 

In the case of clothes washers, the 

Department is proposing to eliminate 

certain previously defined 

classifications (Semi-Automatic TopLoading. Front-Loading and Suds 

Saving) because they do not offer any 

added utility which is inherently less 

energy efficient and therefore would 

require protection from the energy 

conservation standards. In the May 1991 

final rule. these classes were not subject 

to a minimum energy conservation 

standard imposed because they 

represented a small portion of the 

market. and due to a lack of adequate 

information the Department did not 

anaivze them. However. the 1988 

standard requiring an unheated rinse 

option is still applicable to these 

classes. The Department has further 

reviewed this topic and believes that 

these products should be subject to the 

minimum energy conservation 

standards applicable to either compact 

or standard clothes washers. The 

Department welcomes comments on this 

issue. 

2. Baseline Units 

For the purpose of generating a cost! 

efficiency relationship, the Engineering 

Analysis needs to define a starting point 

or baseline. The assumed baseline unit 

is to represent a typical model within an 

appliance class sold during the initial 

year of the analysis. e.g .. a unit that 

minimally exceeds the existing 

standard. Once identified. each baseline 

J The energy factor is a n:easurement of energy 

efficiency derh'ed from the DepanmE'n! of Energ, 

test procedure for that product. 

F'ederal Register I Vol. 59. No. 218', Monday. November 14. 1994 , Proposed Rules 56425 

the projections uIlder the proposed 

standards and. perhaps. by comparing 

the projections of various proposed 

standards. The possible comparison of 

different standard cases was one of the 

issues raised in t.'1.e Three Product 

Advance Notice. The analysis method 

chosen. based on the review of public 

comments on this earlier notice. as weH 

as. comments receh'ed in response to 

today's notice. will be used in the . 

development of the proposed standards 

for the products addressed by this 

Advance Notice. 

The analysis that will be performed is 

made up of the foUO\\,'ing items: 

• An Engineering Analysis that 

establishes the technical feasibility and 

product attributes. mcluding costs of 

design options. to improve appliance 

efficiency. 

• A Manufacturer Anaiysis that 

pro\'ides an estimate of manufacturers' 

responses to the proposed standards. 

Their responses are quantified by 

changes in several financial 

performance measures. such as pricing. 

output and profitability etc. 

• A Consumer AnalYsis that forecasts 

appliance sales. efficiencies. energy use. 

consumer expenditures. and the 

national net benefits and costs and a 

separate Life Cycle Cost Ana1ysis to 

evaluate the purchaser's savings in 

operating expenses relath'e to increases 

in purchase price. 

• A Utility Analysis that measures the 

projected impacts of the altered energ.yconsumption patterns on electric and 

gas utili ties. . Each analysis area wiil be performed 

for each of the three products under 

consideration. The results of the 

Engineering Analysis will be reviewed 

by tb.e Department to determine whether 

standards for each product could yield 

measurable energy savings. If standards 

would not yield energy savings. then the 

analysis will be terminated. If energy 

sa\ings are possible. then a detailed 

analysis is performed. 

There is interaction among the 

Engineering. Consumer. Utility. and 

Manufacturer Analyses. The 

Engineering Analysis examines 

appliance designs and related attributes 

such as efficiency and costs. Based on 

the relationships between the prices and 

efficiencies of design options. the 

Consumer Analysis forecasts sales and 

efficiencies of new and replacement 

appliances. These data are used as 

inputs to the Manufacturer Analysis to 

determine the financial impacts on 

prototypical firms within the industry. 

The Consumer Analvsis forecasts 

national aggregate energy savings and 

consumer expenditures associated with 

the purchase and operation of the 

appliances. Consumer expenditures 

(both purchase and operation) are 

employed in the Life-Cycle Cost 

Analysis to determine consumer 

impacts. Changes in sales. revenues. 

investments. and marginal costs of 

utilities are calculated from the energy 

savings in the Utility Analysis. 

Three periods of time are used in the 

analyses. First. the Engineering Analysis 

examines the technical feasibility of 

improving the.efficiency of the covered 

products by analyzing design options 

available today to improve product 

efficiency. whether they are . 

commercially available or prototypes. 

Second. the Manufacturer Analvsis is 

performed for a typical year after the 

standards are assumed to have been 

imposed. Typically. the fifth year is 

selected. so all major impacts of a 

standard would have occurred. Third. 

the Consumer Analysis examines 

impacts o'.er a time period at least as 

long as the average lifetimes of the 

products. 

III. Models. Data. and Assumptions 

a. Engineering Performance Models and 

Costing Analysis 

The Engineering Anairsis addresses 

two statutory requirements. The first 

requirement is that the Department 

consider only improvements in energy 

efficiency that are technologically 

feasible. The second is that the 

Department consider any lessening of 

utility to the consumer due to the 

imposition of standards. In addition. the 

Engineering Analysis provides 

information on efficiencies, energy 

consumption. manufacturing costs. and 

maintenance and installation costs for 

use in the other analyses. 

The Engineering Analysis develops 

cost and efficiency data for a set of 

design options withm each appliance 

class. These data are the output of the 

engineering performance models and 

costing analysis discussed in 

subsections 5-9. below. 

1. Appliance Classes 

The first step in the Engineering 

Analysis is to segregate product types 

into separate classes to which different 

energy conservation standards apply. 

Classes are differentiated by the type of 

energy use (oil. natural gas. or 

electricity) or capacity or performancerelated features that provide utility to 

the consumer and affect efficiency. 

Classes are differentiated in order to 

ensure that consumer products having 

different capacities or other 

performance-related features affecting 

efficiency and utility remain available to 

consumers. 

For each of the three appliances. the 

follOWing are the classes that the 

Department proposes to consider. The 

Department welcomes comments on the 

proposed classes. 

(i) Dishwashers 

Compact Dishwasher (less than 22 

. inches in exterior width) 

Standard Dishwasher (equal to or 

greater than 22 inches in exterior 

\\'idth) 

(ii) Clothes Washers 

Compact (less than 1.6 ft 3 capacity) 

Standard (1.6 ft 3 or greater capacity) 

(iii) Clothes Dryers 

Electric. Standard (4.4 ft 1 or greater 

capacity) 

Electric. Compact. 120\' (less than 4.4 

ft 3 capacity) 

Electric. Compact. 240v (less than 4.4 

ft 3 capacity) 

Gas. Standard (4.4 ft 3 or greater 

capacity) . 

Gas, Compact (less than 4.4 ft 3 capacityl 

In the case of clothes washers, the 

Department is proposing to eliminate 

certain previously defined 

classifications (Semi-Automatic TopLoading. Front-Loading and Suds 

Saving) because they do not offer any 

added utility which is inherently less 

energy efficient and therefore would 

require protection from the energy 

conservation standards. In the May 1991 

final rule. these classes were not subject 

to a minimum energy conservation 

standard imposed because they 

represented a small portion of the 

market. and due to a lack of adequate 

information the Department did not 

anaivze them. However. the 1988 

standard requiring an unheated rinse 

option is still applicable to these 

classes. The Department has further 

reviewed this topic and believes that 

these products should be subject to the 

minimum energy conservation 

standards applicable to either compact 

or standard clothes washers. The 

Department welcomes comments on this 

issue. 

2. Baseline Units 

For the purpose of generating a cost! 

efficiency relationship, the Engineering 

Analysis needs to define a starting point 

or baseline. The assumed baseline unit 

is to represent a typical model within an 

appliance class sold during the initial 

year of the analysis. e.g .. a unit that 

minimally exceeds the existing 

standard. Once identified. each baseline 

J The energy factor is a n:easurement of energy 

efficiency derh'ed from the DepanmE'n! of Energ, 

test procedure for that product. 
56426 Federal Register I Vol. 59. No. 218 I Monday, November 14; 1994 I Proposed Rules . I

unit is characterized by its efficiencyrelated design options. The Engineering

Analysis uses information gathered from

trade organizations, manufacturers, and

consultants with expertise in specific

product types to determine the

engineering characteristics ofthe

baseline unit. The Department requests

data on specific units and combinations

of design'options to be considered as a

baseline unit. In addition, the

Department requests comments on any

other factors to be considered in

selecting baseline units.

3. Design Options

The Engineering Analysis will

identify an individual design option or

combinations of design options with a

potential for improving energy

efficiency. Design options that are

currently on the market, that are being

developed, or that may be on the market

bv the time standards are effective will be considered. Furthermore. the

Department requests comments on

whether the existing test procedures are

appropriate for measuring product

energy use and efficiency and whether

the test procedure can evaluate a

particular design option's contribution

to the product's energy consumption.

In addition to proposing a credit for

more efficient water extraction in the . clothes washer test procedure, the

Department may consider a two tier

energy conservation standard for clothes

washers. One standard would be the

same as the existing performance

standard for clothes washers and the

second standard would require a

minimum water extraction. The

Department believes that mechanical

water extraction is much more cost

cffective than thermal extraction. Ifthe

Department were to propose this two

tier standard. then the analvsis for the

clothes tiryer standard would consider

the impact of drier clothes entering the

clothes dryer. The Department

welcomes comments on this issue.

The Department requests comments

on both the design options listed below

and the applicability of the extant or

proposed test procedure. The following

is a list of design options that will be

examined:

(0 Dishwashers

Energy Savings Options for Water

Reduction:

(A) Improved food filter

(B) Improved spray arm geometry

(C) Improved fill control

(D) Modified sump geometry with &

without dual pumps

(E) Microprocessor controls and fuzzy

logic (algorithm logic bllsed on sensor

input)

Other Energy Saving Options:

(F) Reduce<t inlet water temperature

(G) Improved motor efficiency

(H) Increased insulation

(I) Flow-thru heating

(J) Ultrasonic washing

(ii) Clothes Washers

(A) Improved fill control . (B) Configuration/tolerance of inner and

outer tubs to reduce water use

(C) Reduce thermal mass

(D) Added Insulation

(E) Increase motor efficiency

(F) Thermostatically controiled mixing

valves

(G) Electrolytic dissociation of water

(H) Ultrasonic washing

(I) Higher spin speed

(J) Horizontal axis design

(K) Bubble action

(L) Microprocessor controls and fuzzy

logic (algorithm logic based on sensor . input)

(M) Ozonated laundering

(N) Suds saving

(0) Direct drive motor

(iii) Clothes Dryers

(A) Automatic termination

(B) Increased insulation

(C) Recycle exhaust heat

(D) Inlet air preheat

(E) Inlet air preheat. condensing mode

(F) Modified operating conditions

(G) Heat pump

(H) Microwave

(I) Reverse tumble feature

(J) ?nproved rib design to reduce drying

hme

4. Maximum Technologically Feasible

Designs

The Act requires that, in considering

any new or amended standards, the

Department must consider those that

"shall be designed to achieve the

maximum improvement in energy

efficiency that the Secretary determines

is technologically feasible and

economically justified" (section

325(l}(2)(A)). As a first step, the

maximum technologically feasible level

will be identified. The maximum

technologically feasible level is one that

can be carried out by the addition of

energy efficient design improvements to

the baseline units without affecting the

product's utility. The Depa.'1ment .

believes that the design options

comprising the maximum

technologically feasible level must have

been physically demonstrated in at least

a prototype form to be considered

technologically feasible.

5. Performance Models

In the Engineering Analysis. the

Department's estimate of the efficiency

of various design options and

combination of design options will be

based on either calculation (e.g.,

computersimulation models) or

experimental data based on the

Department's test procedures. The

Depart.TDent requests test data on the .

efficiency of the various design options

and information on possible simulation

models for use in this rulemaking.

6. Costing Analysis

Manufacturer cost data for baseline

units and incremental costs for design

improvements are requested. The cost

data requested include, for each design

option. incremental cost data

disaggregated into labor. purchased

parts. materials. shipping/packaging.

and tooling. Also requested are any

additional consumer installation or

maintenance costs resulting from the

design improvements.

7. Price-Efficiency Relationships

The results of the Engineering

Analysis are summarized in the costefficiency relationships that show the

efficiency. unit energy consumption.

and manufacturer cost of each design

option and combination of design

options for each appliance class.

Manufacturer and dealer markups

obtained from the Manufacturer 1moact

Analysis are applied to the •

manufacturing costs to determine the

purchase price of the appliance. The

price-efficiency relationships are a .

fundamental input to the Consumer

Analysis.

8. Data Sources

Shipments data. costs of purchased

materials and parts. and engineering

and labor cost data will be based on

available information, including

information received in comments on

this Advance Notice of Proposed

Rulemaking and collected from industry

sources.

9. Outputs From the Engineering

Analysis

For each combination of design

options considered. the models and data

provide:

• Energy efficiency (expressed as the

Department's energy factor),3

• Annual energy consumption per

unit (based on the Department's test

procedures).

• Increased material. purchased parts.

labor. and investment costs for

medium -I and large manufacturers bv

product class, -

• As was tne case with previo\l.S analpes. smail

manufacturers will not be analyzed separately. No

general manufacturing approach could be identified

for these firms because of the wide \'ariabiJily in

 EE-RM-94-403 COMMENT 101C

56426 Federal Register I Vol. 59. No. 218 I Monday, November 14; 1994 I Proposed Rules 

unit is characterized by its efficiencyrelated design options. The Engineering 

Analysis uses information gathered from 

trade organizations, manufacturers, and 

consultants with expertise in specific 

product types to determine the 

engineering characteristics of the 

baseline unit. The Department requests 

data on specific units and combinations 

of design'options to be considered as a 

baseline unit. In addition, the 

Department requests comments on any 

other factors to be considered in 

selecting baseline units. 

3. Design Options 

The Engineering Analysis will 

identify an individual design option or 

combinations of design options with a 

potential for improving energy 

efficiency. Design options that are currently on the market, that are being 

developed, or that may be on the market 

bv the time standards are effective will be considered. Furthermore, the 

Department requests comments on 

whether the existing test procedures are 

appropriate for measuring product 

energy use and efficiency and whether 

the test procedure can evaluate a 

particular design option's contribution 

to the product's energy consumption. 

In addition to proposing a credit for more efficient water extraction in the . 

clothes washer test procedure, the 

Department may consider a two tier 

energy conservation standard for clothes 

washers. One standard would be the 

same as the existing performance 

standard for clothes washers and the 

second standard would require a 

minimum water extraction. The 

Department believes that mechanical 

water extraction is much more cost 

effective than thermal extraction. If the 

Department were to propose this two 

tier standard. then the analvsis for the 

clothes uryer standard would consider 

the impact of drier clothes entering the 

clothes dryer. The Department 

welcomes comments on this issue. 

The Department requests comments 

on both the design options listed below 

and the applicability of the extant or 

proposed test procedure. The following 

is a list of design options that will be 

examined: 

(0 Dishwashers 

Energy Savings Options for Water 

Reduction: 

(A) Improved food filter 

(B) Improved spray arm geometry 

(C) Improved fill control 

(D) Modified sump geometry with & 

without dual pumps 

(E) Microprocessor controls and fuzzy 

Jogic (algorithm logic bllsed on sensor input) 

Other Energy Saving Options: 

(F) Reduce<t inlet water temperature 

(G) Improved motor efficiency 

(H) Increased insulation 

(I) Flow-thru heating 

(J) Ultrasonic washing 

(ii) Clothes Washers 

(A) Improved fill control . 

(B) Configuration/tolerance of inner and 

outer tubs to reduce water use 

(Cl Reduce thermal mass (D) Added Insulation 

(E) Increase motor efficiency 

(F) Thermostatically controiled mixing 

valves 

(G) Electrolytic dissociation of water 

(H) Ultrasonic washing 

(I) Higher spin speed 

(J) Horizontal axis design 

(K) Bubble action 

(L) Microprocessor controls and fuzzy 

logic (algorithm logic based on sensor . input) 

(M) Ozonated laundering 

(N) Suds saving 

(0) Direct drive motor 

(iii) Clothes Dryers 

(A) Automatic termination 

(B) Increased insulation 

(C) Recycle exhaust heat 

(D) Inlet air preheat 

(E) Inlet air preheat, condensing mode 

(F) Modified operating conditions 

(G) Heat pump 

(H) Microwave 

(I) Reverse tumble feature 

(J) ?nproved rib design to reduce drying 

hme 

4. Maximum Technologically Feasible 

Designs 

The Act requires that. in considering 

any new or amended standards, the 

Department must consider those that 

"shall be designed to achieve the 

maximum improvement in energy 

efficiency that the Secretary determines 

is technologically feasible and 

economically justified" (section 

325(l)(2)(A)). As a first step, the 

maximum technologically feasible level 

will be identified. The maximum 

technologically feasible level is one that 

can be carried out by the addition of 

energy efficient design improvements to 

the baseline units without affecting the 

product's utility. The Depa.'1lllent . 

believes that the design options 

comprising the maximum 

technologically feasible level must have 

been physically demonstrated in at least 

a prototype form to be considered 

technologically feasible. 

5. Performance Models 

In the Engineering Analysis, the 

Department's estimate of the efficiency 

of various design options and 

combination of design options will be 

based on either calculation (e.g., 

computer simulation models) or 

experimental data based on the 

Department's test procedures. The 

Depart.Tflent requests test data on the . 

efficiency of the various design options 

and information on possible simulation 

models for use in this rulemaking. 

6. Costing Analysis 

Manufacturer cost data for baseline 

units and incremental costs for design 

improvements are requested. The cost 

data requested include, for each design 

option. incremental cost data 

disaggregated into labor. purchased 

parts. materiais. shipping/packaging. 

and tooling. Also requested are any 

additional consumer installation or 

maintenance costs resulting from the 

design improvements. 

7. Price-Efficiency Relationships 

The results of the Engineering 

Analysis are summarized in the costefficiency relationships that show the 

efficiency. unit energy consumption. 

and manufacturer cost of each design 

option and combination of design 

options for each appliance class. 

Manufacturer and dealer markups 

obtained from the Manufacturer 1m oact 

Analysis are applied to the ' 

manufacturing costs to determine the 

purchase price of the appliance. The 

price-efficiency relationships are a . 

fundamental input to the Consumer 

Analysis. 

8. Data Sources 

Shipments data. costs of purchased 

materials and parts, and engineering 

and labor cost data will be based on available information, including 

information received in comments on 

this Advance Notice of Proposed 

Rulemaking and collected from industry sources. 

9. Outputs From the Engineering 

Analysis 

For each combination of design 

options considered. the models and data 

provide: 

• Energy efficiency (expressed as the 

Department's energy factor),3 

• Annual energy consumption per 

unit (based on the Department's test 

procedures), 

• Increased material. purchased parts. 

Jabor. and investment costs for 

medium 0\ and large manufacturers bv 

product class. -

• As was tile case with previou.s analpes. smail 

manufacturers will not be analyzed separately. No 

general manufacturing approach could be identified 

for these firms because of the wide \'ariability in 

56426 Federal Register I Vol. 59. No. 218 I Monday, November 14; 1994 I Proposed Rules .. 

unit is characterized by its efficiencyrelated design options. The Engineering 

Analysis uses information gathered from 

trade organizations, manufacturers, and 

consultants with expertise in specific 

product types to determine the 

engineering characteristics of the 

baseline unit. The Department requests 

data on specific units and combinations 

of design'options to be considered as a 

baseline unit. In addition, the 

Department requests comments on any 

other factors to be considered in 

selecting baseline units. 

3. Design Options 

The Engineering Analysis will 

identify an individual design option or 

combinations of design options with a 

potential for improving energy 

efficiency. Design options that are currently on the market, that are being 

developed, or that may be on the market 

bv the time standards are effective will be considered. Furthermore, the 

Department requests comments on 

whether the existing test procedures are 

appropriate for measuring product 

energy use and efficiency and whether 

the test procedure can evaluate a 

particular design option's contribution 

to the product's energy consumption. 

In addition to proposing a credit for more efficient water extraction in the . 

clothes washer test procedure, the 

Department may consider a two tier 

energy conservation standard for clothes 

washers. One standard would be the 

same as the existing performance 

standard for clothes washers and the 

second standard would require a 

minimum water extraction. The 

Department believes that mechanical 

water extraction is much more cost 

effective than thermal extraction. If the 

Department were to propose this two 

tier standard. then the analvsis for the 

clothes uryer standard would consider 

the impact of drier clothes entering the 

clothes dryer. The Department 

welcomes comments on this issue. 

The Department requests comments 

on both the design options listed below 

and the applicability of the extant or 

proposed test procedure. The following 

is a list of design options that will be 

examined: 

(0 Dishwashers 

Energy Savings Options for Water 

Reduction: 

(A) Improved food filter 

(B) Improved spray arm geometry 

(C) Improved fill control 

(D) Modified sump geometry with & 

without dual pumps 

(E) Microprocessor controls and fuzzy 

Jogic (algorithm logic bllsed on sensor input) 

Other Energy Saving Options: 

(F) Reduce<t inlet water temperature 

(G) Improved motor efficiency 

(H) Increased insulation 

(I) Flow-thru heating 

(J) Ultrasonic washing 

(ii) Clothes Washers 

(A) Improved fill control . 

(B) Configuration/tolerance of inner and 

outer tubs to reduce water use 

(Cl Reduce thermal mass (D) Added Insulation 

(E) Increase motor efficiency 

(F) Thermostatically controiled mixing 

valves 

(G) Electrolytic dissociation of water 

(H) Ultrasonic washing 

(I) Higher spin speed 

(J) Horizontal axis design 

(K) Bubble action 

(L) Microprocessor controls and fuzzy 

logic (algorithm logic based on sensor . input) 

(M) Ozonated laundering 

(N) Suds saving 

(0) Direct drive motor 

(iii) Clothes Dryers 

(A) Automatic termination 

(B) Increased insulation 

(C) Recycle exhaust heat 

(D) Inlet air preheat 

(E) Inlet air preheat, condensing mode 

(F) Modified operating conditions 

(G) Heat pump 

(H) Microwave 

(I) Reverse tumble feature 

(J) ?nproved rib design to reduce drying 

hme 

4. Maximum Technologically Feasible 

Designs 

The Act requires that. in considering 

any new or amended standards, the 

Department must consider those that 

"shall be designed to achieve the 

maximum improvement in energy 

efficiency that the Secretary determines 

is technologically feasible and 

economically justified" (section 

325(l)(2)(A)). As a first step, the 

maximum technologically feasible level 

will be identified. The maximum 

technologically feasible level is one that 

can be carried out by the addition of 

energy efficient design improvements to 

the baseline units without affecting the 

product's utility. The Depa.'1lllent . 

believes that the design options 

comprising the maximum 

technologically feasible level must have 

been physically demonstrated in at least 

a prototype form to be considered 

technologically feasible. 

5. Performance Models 

In the Engineering Analysis, the 

Department's estimate of the efficiency 

of various design options and 

combination of design options will be 

based on either calculation (e.g., 

computer simulation models) or 

experimental data based on the 

Department's test procedures. The 

Depart.Tflent requests test data on the . 

efficiency of the various design options 

and information on possible simulation 

models for use in this rulemaking. 

6. Costing Analysis 

Manufacturer cost data for baseline 

units and incremental costs for design 

improvements are requested. The cost 

data requested include, for each design 

option. incremental cost data 

disaggregated into labor. purchased 

parts. materiais. shipping/packaging. 

and tooling. Also requested are any 

additional consumer installation or 

maintenance costs resulting from the 

design improvements. 

7. Price-Efficiency Relationships 

The results of the Engineering 

Analysis are summarized in the costefficiency relationships that show the 

efficiency. unit energy consumption. 

and manufacturer cost of each design 

option and combination of design 

options for each appliance class. 

Manufacturer and dealer markups 

obtained from the Manufacturer 1m oact 

Analysis are applied to the ' 

manufacturing costs to determine the 

purchase price of the appliance. The 

price-efficiency relationships are a . 

fundamental input to the Consumer 

Analysis. 

8. Data Sources 

Shipments data. costs of purchased 

materials and parts, and engineering 

and labor cost data will be based on available information, including 

information received in comments on 

this Advance Notice of Proposed 

Rulemaking and collected from industry sources. 

9. Outputs From the Engineering 

Analysis 

For each combination of design 

options considered. the models and data 

provide: 

• Energy efficiency (expressed as the 

Department's energy factor),3 

• Annual energy consumption per 

unit (based on the Department's test 

procedures), 

• Increased material. purchased parts. 

Jabor. and investment costs for 

medium 0\ and large manufacturers bv 

product class. -

• As was tile case with previou.s analpes. smail 

manufacturers will not be analyzed separately. No 

general manufacturing approach could be identified 

for these firms because of the wide \'ariability in 

.. 
Federal Register I Vol. 59. No. 218 I Monday. November 14. 1994 / Proposed Rules 56427

• The relationship between cost and

efficiency level by product class. and • Other information on product

characteristics. such as lifetimes.

maintenance costs and installation

costs.

b. Residential Energy Models

The Department has used the

Lawrence Berkeley Laboratory

Residential Energy Model (LBL-REM) in

the analysis and reanalysis for

numerous Department rulemakings. The

DeparL-nent has considered replacing

the LBL-REM with the Electric Power

Research Institute's REEPS model and is

presently analyzing it for the Three

Prociact Advance Notice ruleniaking.

The Department expects to use the

analvtical method chosen for that

rulemaking in the analysis for this

rulemaking. The Department welcomes

comments on this approach. Below is a

description of both models.

1. Lawrence Berkelev Laboratorv

Residential Energy Model -

The LBL-REM forecasts the appliance

purchase choices that households make

as well as their subsequent appliance

usage behavior and energy

consumption. The model uses

engineering estimates of the

characteristics of particular designs of

appliances and calculates the national

impacts of a technology-specific policy

on the populations of appliances used

in Ll-te households. Alternative designs

are characterized by price and

efficiency. The output from the LBLRE.\1 provides estimates of national

energy savings and consumer economic

impacts (including equipment and

operating expenses).

Engineering. economic. and

demographic data are used in the LBLREM. The engineering data for

appliances include the price-eft1ciency

relationships described above_

Additional data include information

regarding alternative building shell

constrnction measures and costs. unit

energy consumption and efficiency of

existing appliances. age distribution of

existing appliance stock. and retirement

functions. Economic data include

projected energy prices 5 and household

income. models of energy investment.

appliance purchase and usage behavior.

including fuel and technology choice for

each end use. Demographic data include

their approach to manufacturing. Therefore. small

manufacturers' costs have been assumed to equal

those of medium manufacturers. The Deparanent

p.ncoura~es smail manufacturers to submit data.

• The"projections of energy prices will be taken

!rom the most recent Annual Enerf{Y Outlook. a

puolication of the Departrnp.nt's Energy Information

,\dminislration.

number of households by type•

projected housing starts and

demolitions. and initial aooliance

holdings.

Structure ofthe model. The LBL-REM

segments annual energy consumption

into house types. end uses. and fuel

types. The house types are singlefamilv. multifamilv. and mobile homes.

Calculations are performed separately

for existing and new housing

construction each year over the period

1980-2030. The end uses are space

heating (including room and central). air

conditioning (room. central

conventional. and central heat pump).

water heating. refrigeration. cooking.

clothes drying. lighting. clothes

washing. dishwashing. pool heating.

televisions and miscellaneous. Up to

four fuels are considered. as appropriate

to each end use: electricity, natural gas.

heating oil. and liquid petroleum gas.

The model exists in two versions:

national (one region) and regional (10

Federal regions). Since usage of cleaning

products is not likely to differ by

geographic location. the national

version will be utilized in this analvsis.

The model projects five types of .

activities: technology/fuel choice:

building shell thermal integrity choice:

appliance efficiency choice: usage

behavior; and turnover of buildings and

appliances.

Housing stock submodel. This

submodel generates data about housing

stock projections for the LBL-REM. The

number of occupied households. by

type. is taken from the 1990 Census of

Population and Housing. An exogenous

projection for housing starts is obtained.

and estimates of projected demolition

rates by house type are calculated.

assuming an exponential function. The

housing submodel determines the

. projected housing stock each year.

.1981-2030. by subtracting demolitions

from existing stock. then adding starts.

The annual demolition rates bv house

type will be calculated for single-family.

multifamily. and mobile homes.

respectively.

Efficiency choice algorithm. Historical

efficiency data are available primarily

from trade associations for selected

years for each class of appliance through

at least 1992. The Federal energy

conservation standards for new units of

these appliances are expected to be met

by the effective date ofthe standard.

After that date. future efficiency

improvements are assumed to be a

function of designs available (according

to the engineering analysis) and of

relevant energy prices. The forecasting

algorithm is designed to allow annual

average efficiency or shipment-weighted

efficiency factors to increase if either

more efficient designs become a\'ailable

at lower prices or energy prices

increase. Conversely. if energy prices

decrease. the shipment-weighted

efficiency factors may decline. but

would have a lower bound at the

existing standard level. i.e•• the 1991

standard preScribed by the Department.

effective 1994. for dishwashers. clothes

washers and dothesdryers. . Thermal integrity. Toe-LBL-REM

addresses thermal integrity as an input

into the model for conducting analysis

on appliances which affect a dwelling's

cooling or heating load. The Department

believes that thermal integrity will not

be a factor in the analysis for t.l-J.e three

cleaning products. The Department

welcomes comments on this

assumption. . Modeling efficiency standards, The

LBL-REM projects the average

efficiency of new products; for example.

clothes dryers purchased each year in

the absence of additional Federal

regulations. A distribution of

efficiencies is constrncted around the

a\l6rage based on efficiency

distributions observed in the

marketplace. This information includes

information from industrv sources and

published data from the industry trade

associations. A new Federal standard

level eliminates part of the distribution:

therefore. a new distribution is

constructed. The new shipmentweighted average efficiency then

characterizes the efficiency ofne\\' units

in that year. The same process is

applied to all years after

implementation ofthe standard. The

model is then run again for the

standards case6 with the adjusted

average efficiencies to calculate any

changes in market shares or usage

behavior that may occur as a result of

standards and to calculate the net

energy savings.

Turnover oj appliance stocks. The

initial age distribution of appliances in

stock is based on industry data about

historical annual shipments. The

fraction of each product that retires each

year is based on the number of y~ars

since purchase of the product. For each

year's purchase. the model associates an

average efficiency. so that when older

appliances are retired. they are also

recognized as less efficient. All

appliance replacements are included in

the retirement function. including those

resulting for reasons other than product

failure. However. the analysis does not

explicitly consider the effect of

increased purchase price on the

turnover rate. The Department requests

oThe standards case reiers to a time period when a potenrial new standard has been implemen!pd.

 EE-RM-94-403 COMMENT 101C

Federal Register I Vol. 59, No. 218 I Monday. November 14. 1994 / Proposed Rules 56427 

• The relationship between cost and 

efficiency level by product class, and • Other information on product 

characteristics. such as lifetimes, 

maintenance costs and installation 

costs. 

b. Residential Energy Models 

The Department has used the 

Lawrence Berkeley Laboratory 

Residential Energy Model (LBL-REM) in 

the analysis and reanalysis for 

numerous Department rulemakings. The 

DeparL-nent has considered replacing 

the LBL-REM with the Electric Power 

Research Institute's REEPS model and is 

presently analyzing it for the Three 

Prociact Advance Notice ruleniaking. 

The Department expects to use the 

analvtical method chosen for that 

rulemaking in the analysis for this 

rulemaking. The Department welcomes 

comments on this approach. Below is a 

description of both models. 

1. Lawrence Berkelev Laboratorv 

Residential Energy Model . 

The LBL-REM forecasts the appliance 

purchase choices that households make 

as well as their subsequent appliance 

usage behavior and energy 

consumption. The model uses 

engineering estimates of the 

characteristics of particular designs of 

appliances and calculates the national 

impacts of a technology-specific policy 

on the populations of appliances used 

in Ll-te households. Alternative designs 

are characterized by price and 

efficiency. The output from the LBLRE.\1 provides estimates of national 

energy savings and consumer economic 

impacts (including equipment and 

operating expenses). 

Engineering. economic. and 

demographic data are used in the LBLREM. The engineering data for 

appliances include the price-eftlciency 

relationships described above_ 

Additional data include information 

regarding alternative building shell 

construction measures and costs, unit 

energy consumption and efficiency of 

existing appliances. age distribution of 

existing appliance stock. and retirement 

functions. Economic data include 

projected energy prices 5 and household 

income. models of energy investment. 

appliance purchase and usage behavior. 

including fuel and technology choice for 

each end use. Demographic data include 

their approach to manufacturing. Therefore. small 

manufacturers' costs have been assumed to equal 

those of medium manufacturers. The Department 

p.ncoura~es smail manufacturers to submit data. 

• The"projections of energy prices will be taken 

!rom the most recent Annual Energy Outlook. a 

puolication of the DepartmP.nt's Energy Information 

,\dministration. 

number of households by type . 

projected housing starts and 

demolitions. and initial aooliance 

holdings. 

Structure of the mode/. The LBL-REM 

segments annual energy consumption 

into house types. end uses. and fuel 

types. The house types are singlefamilv. multifamilv. and mobile homes. 

Calculations are performed separately 

for existing and new housing 

construction each year over the period 

1980-2030. The end uses are space 

heating (including room and central). air 

conditioning (room. central 

conventional. and central heat pump). 

water heating. refrigeration. cooking. 

clothes drying. lighting. clothes 

washing. dishwashing. pool heating. 

televisions and miscellaneous. Up to 

four fuels are considered. as appropriate 

to each end use: electricity, natural gas. 

heating oil. and liquid petroleum gas. 

The model exists in two versions: 

national (one region) and regional (10 

Federal regions). Since usage of cleaning 

products is not likely to differ by 

geographic location. the national 

version will be utilized in this analvsis. 

The model projects five types of -

activities: technology/fuel choice: 

building shell thermal integrity choice: 

appliance efficiency choice; usage 

behavior; and turnover of buildings and 

appliances. 

Housing stock submodeJ. This 

submodel generates data about housing 

stock projections for the LBL-REM. The 

number of occupied households, by 

type. is taken from the 1990 Census of 

Population and Housing. An exogenous 

projection for housing starts is obtained. 

and estimates of projected demolition 

rates by house type are calculated. 

assuming an exponential function. The 

housing submodel determines the 

, projected housing stock each year. 

,1981-2030. by subtracting demolitions 

from existing stock. then adding starts. 

The annual demolition rates bv house 

type will be calculated for single-family. 

multifamily. and mobile homes. 

respectively. 

Efficiency choice algOrithm. Historical 

efficiency data are available primarily 

from trade associations for selected 

years for each class of appliance through 

at least 1992. The Federal energy 

conservation standards for new units of 

these appliances are expected to be met 

by the effective date of the standard. 

After that date. future efficiency 

improvements are assumed to be a 

function of designs available (according 

to the engineering analysis) and of 

relevant energy prices. The forecasting 

algorithm is designed to allow annual 

average efficiency or shipment-weighted 

efficiency factors to increase if either 

more efficient designs become a\'ailable 

at lower prices or energy prices 

increase. Conversely. if energy prices 

decrease. the shipment-weighted 

efficiency factors may decline. but 

would have a lower bound at the 

existing standard level. i.e., the 1991 

standard preScribed by the Department. 

effective 1994. for dishwashers. clothes 

washers and clothes dryers. . Thermal integrity. Tlie-LBL-REM 

addresses thermal integrity as an input 

into the model for conducting analysis 

on appliances which affect a dwelling's 

cooling or heating load. The Department 

believes that thermal integrity will not 

be a factor in the analysis for tIl.e three 

cleaning products. The Department 

welcomes comments on this 

assumption. ' 

Modeling efficiency standards, The 

LBL-REM projects the average 

efficiency of new products; for example. 

clothes dryers purchased each year in 

the absence of additional Federal 

regulations. A distribution of 

efficiencies is constructed around the 

a\l6rage based on efficiency 

distributions observed in the 

marketplace. This information includes 

information from industrv sources and 

published data from the industry trade 

associations. A new Federal standard 

level eliminates part of the distribution: 

therefore. a new distribution is 

constructed. The new shipmentweighted average efficiency then 

characterizes the efficiency of new units 

in that year. The same process is 

applied to all years after 

implementation of the standard. The 

model is then run again for the 

standards case6 with the adjusted 

average efficiencies to calculate any 

changes in market shares or usage 

behavior that may occur as a result of 

standards and to calculate the net 

energy savings. 

Turnover oj appliance stocks. The 

initial age distribution of appliances in 

stock is based on industry data about 

historical annual shipments. The 

fraction of each product that retires each 

year is based on the number of y~ars 

since purchase of the product. For each 

year's purchase. the model associates an 

average efficiency, so that when older 

appliances are retired. they are also 

recognized as less efficient. All 

appliance replacements are included in 

the retirement function. including those 

reSUlting for reasons other than product 

failure. However. the analysis does not 

explicitly consider the effect of 

increased purchase price on the 

turnover rate. The Department requests 

o The standards case reiers to a time period when a potential new standard has been implemen!pd, 

Federal Register I Vol. 59, No. 218 I Monday. November 14. 1994 / Proposed Rules 56427 

• The relationship between cost and 

efficiency level by product class, and • Other information on product 

characteristics. such as lifetimes, 

maintenance costs and installation 

costs. 

b. Residential Energy Models 

The Department has used the 

Lawrence Berkeley Laboratory 

Residential Energy Model (LBL-REM) in 

the analysis and reanalysis for 

numerous Department rulemakings. The 

DeparL-nent has considered replacing 

the LBL-REM with the Electric Power 

Research Institute's REEPS model and is 

presently analyzing it for the Three 

Prociact Advance Notice ruleniaking. 

The Department expects to use the 

analvtical method chosen for that 

rulemaking in the analysis for this 

rulemaking. The Department welcomes 

comments on this approach. Below is a 

description of both models. 

1. Lawrence Berkelev Laboratorv 

Residential Energy Model . 

The LBL-REM forecasts the appliance 

purchase choices that households make 

as well as their subsequent appliance 

usage behavior and energy 

consumption. The model uses 

engineering estimates of the 

characteristics of particular designs of 

appliances and calculates the national 

impacts of a technology-specific policy 

on the populations of appliances used 

in Ll-te households. Alternative designs 

are characterized by price and 

efficiency. The output from the LBLRE.\1 provides estimates of national 

energy savings and consumer economic 

impacts (including equipment and 

operating expenses). 

Engineering. economic. and 

demographic data are used in the LBLREM. The engineering data for 

appliances include the price-eftlciency 

relationships described above_ 

Additional data include information 

regarding alternative building shell 

construction measures and costs, unit 

energy consumption and efficiency of 

existing appliances. age distribution of 

existing appliance stock. and retirement 

functions. Economic data include 

projected energy prices 5 and household 

income. models of energy investment. 

appliance purchase and usage behavior. 

including fuel and technology choice for 

each end use. Demographic data include 

their approach to manufacturing. Therefore. small 

manufacturers' costs have been assumed to equal 

those of medium manufacturers. The Department 

p.ncoura~es smail manufacturers to submit data. 

• The"projections of energy prices will be taken 

!rom the most recent Annual Energy Outlook. a 

puolication of the DepartmP.nt's Energy Information 

,\dministration. 

number of households by type . 

projected housing starts and 

demolitions. and initial aooliance 

holdings. 

Structure of the mode/. The LBL-REM 

segments annual energy consumption 

into house types. end uses. and fuel 

types. The house types are singlefamilv. multifamilv. and mobile homes. 

Calculations are performed separately 

for existing and new housing 

construction each year over the period 

1980-2030. The end uses are space 

heating (including room and central). air 

conditioning (room. central 

conventional. and central heat pump). 

water heating. refrigeration. cooking. 

clothes drying. lighting. clothes 

washing. dishwashing. pool heating. 

televisions and miscellaneous. Up to 

four fuels are considered. as appropriate 

to each end use: electricity, natural gas. 

heating oil. and liquid petroleum gas. 

The model exists in two versions: 

national (one region) and regional (10 

Federal regions). Since usage of cleaning 

products is not likely to differ by 

geographic location. the national 

version will be utilized in this analvsis. 

The model projects five types of -

activities: technology/fuel choice: 

building shell thermal integrity choice: 

appliance efficiency choice; usage 

behavior; and turnover of buildings and 

appliances. 

Housing stock submodeJ. This 

submodel generates data about housing 

stock projections for the LBL-REM. The 

number of occupied households, by 

type. is taken from the 1990 Census of 

Population and Housing. An exogenous 

projection for housing starts is obtained. 

and estimates of projected demolition 

rates by house type are calculated. 

assuming an exponential function. The 

housing submodel determines the 

, projected housing stock each year. 

,1981-2030. by subtracting demolitions 

from existing stock. then adding starts. 

The annual demolition rates bv house 

type will be calculated for single-family. 

multifamily. and mobile homes. 

respectively. 

Efficiency choice algOrithm. Historical 

efficiency data are available primarily 

from trade associations for selected 

years for each class of appliance through 

at least 1992. The Federal energy 

conservation standards for new units of 

these appliances are expected to be met 

by the effective date of the standard. 

After that date. future efficiency 

improvements are assumed to be a 

function of designs available (according 

to the engineering analysis) and of 

relevant energy prices. The forecasting 

algorithm is designed to allow annual 

average efficiency or shipment-weighted 

efficiency factors to increase if either 

more efficient designs become a\'ailable 

at lower prices or energy prices 

increase. Conversely. if energy prices 

decrease. the shipment-weighted 

efficiency factors may decline. but 

would have a lower bound at the 

existing standard level. i.e., the 1991 

standard preScribed by the Department. 

effective 1994. for dishwashers. clothes 

washers and clothes dryers. . Thermal integrity. Tlie-LBL-REM 

addresses thermal integrity as an input 

into the model for conducting analysis 

on appliances which affect a dwelling's 

cooling or heating load. The Department 

believes that thermal integrity will not 

be a factor in the analysis for tIl.e three 

cleaning products. The Department 

welcomes comments on this 

assumption. ' 

Modeling efficiency standards, The 

LBL-REM projects the average 

efficiency of new products; for example. 

clothes dryers purchased each year in 

the absence of additional Federal 

regulations. A distribution of 

efficiencies is constructed around the 

a\l6rage based on efficiency 

distributions observed in the 

marketplace. This information includes 

information from industrv sources and 

published data from the industry trade 

associations. A new Federal standard 

level eliminates part of the distribution: 

therefore. a new distribution is 

constructed. The new shipmentweighted average efficiency then 

characterizes the efficiency of new units 

in that year. The same process is 

applied to all years after 

implementation of the standard. The 

model is then run again for the 

standards case6 with the adjusted 

average efficiencies to calculate any 

changes in market shares or usage 

behavior that may occur as a result of 

standards and to calculate the net 

energy savings. 

Turnover oj appliance stocks. The 

initial age distribution of appliances in 

stock is based on industry data about 

historical annual shipments. The 

fraction of each product that retires each 

year is based on the number of y~ars 

since purchase of the product. For each 

year's purchase. the model associates an 

average efficiency, so that when older 

appliances are retired. they are also 

recognized as less efficient. All 

appliance replacements are included in 

the retirement function. including those 

reSUlting for reasons other than product 

failure. However. the analysis does not 

explicitly consider the effect of 

increased purchase price on the 

turnover rate. The Department requests 

o The standards case reiers to a time period when a potential new standard has been implemen!pd, 
56428 Federal Register I VoL 59. !\io. 218 I Monday. November 14. 1994 I Proposed Rules

data and comments on how to consider

this factor.

The number of potential purchasers of

an appliance in new homes is equal to

the number of new bomes constructed

each year. The number of potential

purchasers of appliances in exis!ing. . houses is equal to the number ot retmng

appliances plus (if applicable) a fraction

of those households that did not

previously own the product.

Calculation ofmarket shares.

Potential purchasers may purchase any

competing technology within an end

use or none. For each end use. long-term

market share elasticities are estimated

with respect to equipment price.

operating expense. and income.

respectively. The effect of-standards is

expected to be lower operating expense

and increased equipment price. The

percentage changes in these quantities

are used. together with market share

elasticities. to determine changes in

market share resulting from standards.

The model assumes that higher

equipment prices will decrease sales

volumes while lower operating . expenses will increase them. The net

result (predicted market share) depends

on the standard level selected with its

associated equipment prices and

operating expenses.

Usage behavior. For some products

changing the operating expense results

in changes in usage behavior. These

changes are modeled based on usage

elasticities in operating expense and

income. For dishwashers. clothes

washers and clothes dryers we expect

these elasticities to be at or near zero;

usage behavior is not influenced by the

cost of operating the appliance. On the

other hand. the popularity of certain

"energy saving" features. such as air (in

lieu of heated) drying on dishwashers

suggests that some consumers alter their

behavior in response to operating costs.

The Department requests comments on

this assumption.

Energy consumption calculations. The

total energy consumption per hause for

each end use and fuel by house type and

vintage (existing or new) is the product

ofthe unit energy consumption

(accounting for efficiency and capacity

changes) and usage factor. e.g.• relative

hours of full-load use for dishwashers.

The corresponding annual energy

consumption for all households is the

annual consumption per household.

times the number of households of that

type and vintage. times the fraction of

those households owning that

appliance. I .,.

Aggregate energy consumption IS

obtained by summing intermediate

results. For example. national electricity

consumption for residential .

dishwashing in a pa!1icular year is the

sum across house types and house

vintages of electricity used by compact

and standard dishwashers. National

residential electricity consumption in

that year is the sum of all end uses of

electricity consumption in the

residential sector.

Model outputs. The principal outputs

from the LBL-REM for each year are: • Energy consumption by end use

and fuel. • Total residential energy

consumption by fuel. • Per-unit equipment price and

operating expense by product. • Projected annual shipments of

residential a?pliances. and • Differences in these quantities

between a base and a standards case. These outputs are provided annually

(or for selected years) and cumulatively

over a period of time. e.g.• 1999-2030.

Energy savings are provided annually

from implementation of standards to the

-end of the period. Net present value of

standards is evaluated for each

regulated product and for the end use(s)

comprising the regulated and competing

products.

Energy savings are calculated as the

difference in energy consumption

between the base case and standards . case. Energy consumption in both the

base case and standards case includes

changes in fuel choice or changes in

usage behavior. Therefore. the energy

savings capture the net energy savings

due to regulation. including the effects

induced by shifts in market share or

changes in usage behavior.

Net present value. on the other hand.

excludes these types of effects.7 Net

present value is calculated from per-unit

changes in equipment artd operating

expenses. multiplied by startdards case

shipments. If the net present value were

calculated without normalizing \\'ith

regard to shipments. erroneous results

would be obtained. Ifstandards caused

decreased purchases of a product. this

would appear as an economic benefit;

namely. less money spent on purchasing

and using appliances.s Ifstandards

7 Present nlue is the discounted total value of

energy consumption during the appliances'

lifetimes. plus the discounted equipment costs for

those appliances that are purchased during those

periods at alternative standards levels. The

difference between a standards case and a base case is the net present value attributable to amended

standards. A pOSitive net present value for an appliance at a given standard level indicates that.

Hthat standard were adopted. consumers ofthat

appliance as a whole would save that much more money in fuel costs. discounted to the present. than

they would pay in increased initial price for e more

efficient appliance. discounted to the present.

compared to the base case.

S Without nonnalization. the greatest economic

benefit would be obtained by a standard level that

resulted in increased purchases. this

would be incorrectly counted as a cost

when it reflects consumers' preference

for the post-standards product.

Base case usage is assumed in

calculating the net present value since anv "rebound effect"g reflects the

consumer's judgment that increased

usage is worth more than the direct

energy savings associated with keeping

usage constant. Therefore. deduction of

any foregone energy savings resulting

from a possible "rebound effect," prior

to calculating the net present value.

would result in an underestimate of the

true net present value associated with a given efficiency improvement.

Otherimpacts. In determining

economic justification. the Act directs

the Department to consider a number of

different factors. Among these factors

are requirements that the Department

consider the economic impact of the

standard on consumers. In this regard.

the Act establishes a rebuttable

presumption that a standard is

economically justified if the additional

product costs attributable to the

standard are less than three times the

value ofthe first year energy cost

savings. Also. the Department is

required to consider changes in the lifecycle costs resulting from the standard.

Taking into consideration these

various requirements. the Department

calculates:

• The estimated simple payback of

additional product costs (based on

estimated changes in product purchase

prices) by the energy cost savings

projected to result from the proposed

standard.

• The estimated changes in life-cycle

costs to the consumer likely to result

from the proposed standard. and

• The net present value of estimated

savings to the Nation of the proposed

standard.

The calculation of both consumer lifecycle costs and national net present

costslbenefits require the use of

appropriate discount rates. The discount

rate used in sucb calculations is

intended to approximate the time-value

of money ofthose who would bear the

additional product prices resulting from.

resulted in no future purchases of the product.

Then no money would be spent on purchasing the

product or on operating expenses. and the value of

the savings would equal the amount ofmoney that

would have been spent without the standard. This

would clearly be a misrepresentation of the net

present value ofstandards.

"The "rebound effect" is the projected energy

savings from an efficiency improvement that does

not occur. This results when purchasers of more energy efficient appliance use them more intensively. thereby saving less energy than the

engineering estimates would have indicated. In

some instances. the rebound is zero.

 EE-RM-94-403 COMMENT 101C

56428 Federal Register I VoL 59. !\io. 218 I Monday. November 14. 1994 I Proposed Rules 

data and comments on how to consider 

this factor. 

The number of potential purchasers of 

an appliance in new homes is equal to 

the number of new bomes constructed 

each year. The number of potential 

purchasers of appliances in exis!ing. . houses is equal to the number or retmng 

appliances plus (if applicable) a fraction 

of those households that did not 

previously own the product. 

Calculation of market shares. 

Potential purchasers may purchase any 

competing technology within an end 

use or none. For each end use. long-term 

market share elasticities are estimated 

with respect to equipment price. 

operating expense. and income. 

respectively. The effect of-standards is 

expected to be lower operating expense 

and increased equipment price. The 

percentage changes in these quantities 

are used. together with market share 

elasticities. to determine changes in 

market share resulting from standards. 

The model assumes that higher 

equipment prices will decrease sales 

volumes while lower operating . expenses will increase them. The net 

resuit (predicted market share) depends 

on the standard level selected with its 

associated equipment prices and 

operating expenses. 

Usage behavior. For some products 

changing the operating expense results 

in changes in usage behavior. These 

changes are modeled based on usage . 

elasticities in operating expense and 

income. For dishwashers. clothes 

washers and clothes dryers we expect 

these elasticities to be at or near zero; 

usage behavior is not influenced by the 

cost of operating the appliance. On the 

other hand. the popularity of certain 

"energy saving" features. such as air (in 

lieu of heated) drying on dishwashers 

suggests that some consumers alter their 

behavior in response to operating costs. 

The Department requests comments on 

this assumption. 

Energy consumption calculations. The 

total energy consumption per hause for 

each end use and fuel by house type and 

vintage (existing or new) is the product 

of the unit energy consumption 

(accounting for efficiency and capacity 

changes) and usage factor. e.g .• relative 

hours of full-load use for dishwashers. 

The corresponding annual energy 

consumption for all households is the 

annual consumption per household. 

times the number of households of that 

type and vintage. times the fraction of 

those households owning that 

appliance. I ., . 

Aggregate energy consumption IS 

obtained by summing intermediate 

results. For example. national electricity 

consumption for residential . 

dish washing in a pa.'1icular year is the 

sum across house types and house 

Vintages of electricity used by compact 

and standard dishwashers. National 

residential electricity consumption in 

that year is the sum of all end uses of 

electricity consumption in the 

residential sector. 

Model outputs. The principal outputs 

from the LBL-REM for each year are: • Energy consumption by end use 

and fuel. • Total residential energy 

consumption by fuel. • Per-unit equipment price and 

operating expense by product. • Projected annual shipments of 

residential a?pliances. and • Differences in these quantities 

between a base and a standards case. These outputs are provided annually 

(or for selected years) and cumulatively 

over a period of time. e.g., 1999-2030. 

Energy savings are provided annually 

from implementation of standards to the 

-end of the period. Net present value of 

standards is evaluated for each 

reguiated product and for the end use(s) 

comprising the regulated and competing 

products. 

Energy savings are calculated as the 

difference in energy consumption 

between the base case and standards . case. Energy consumption in both the 

base case and standards case includes 

changes in fuel choice or changes in 

usage behavior. Therefore. the energy 

savings capture the net energy savings 

due to regulation. including the effects 

induced by shifts in market share or 

changes in usage behavior. 

Net present value. on the other hand. 

excludes these types of effects. 7 Net 

present value is calculated from per-unit 

changes in equipment and operating 

expenses. multiplied by standards case 

shipments. If the net present value were 

calculated without normalizing \\'ith 

regard to shipments. erroneous results 

would be obtained. If standards caused 

decreased purchases of a product. this 

would appear as an economic benefit; 

namely. less money spent on purchasing 

and using appliances.s If standards 

7 Present nlue is the discounted total value of 

energy consumption during the appliances' 

lifetimes. plus the discounted equipment costs for 

those appliances that are purchased during those 

periods at alternative standards levels. The 

difference between a standards case and a base case is the net present value attributable to amended 

standards. A positive net present value for an appliance at a given standard level indicates that. 

H that standard were adopted. consumers ofthat 

appliance as a whole would save that much more money in fuel costs. discounted to the present. than 

they would pay in increased initial price for e more 

efficient appliance. discounted to the present. 

compared to the base case. 

S Without nonnalization. the greatest economic 

benefit would be obtained by a standard le\'e! that 

resulted in increased purchases. this 

would be incorrectly counted as a cost 

when it reflects consumers' preference 

for the post-standards product. 

Base case usage is assumed in 

calculating the net present value since anv "rebound effect"g reflects the 

consumer's judgment that increased 

usage is worth more than the direct 

energy savings associated with keeping 

usage constant. Therefore. deduction of 

any foregone energy savings resulting 

from a possible "rebound effect," prior 

to calculating the net present value. 

would result in an underestimate of the 

true net present value associated with a given efficiency improvement. 

Other impacts. In determining 

economic justification, the Act directs 

the Department to consider a number of 

different factors. Among these factors 

are requirements that the Department 

consider the economic impact of the 

standard on consumers. In this regard. 

the Act establishes a rebuttable 

presumption that a standard is 

economically justified if the additional 

product costs attributable to the 

standard are less than three times the 

value of the first year energy cost 

savings. Also. the Department is 

required to consider changes in the lifecycle costs resulting from the standard. 

Taking into consideration these 

various requirements. the Department 

calculates: 

• The estimated simple payback of 

additional product costs (based on 

estimated changes in product purchase 

prices) by the energy cost savings 

projected to result from the proposed 

standard. 

• The estimated changes in life-cycle 

costs to the consumer likely to result 

from the proposed standard. and 

• The net present value of estimated 

savings to the Nation of the proposed 

standard. 

The calculation of both consumer lifecycle costs and national net present 

costslbenefits require the use of 

appropriate discount rates. The discount 

rate used in sucb calculations is 

intended to approximate the time-value 

of money of those who would bear the 

additional product prices resulting from. 

resulted in no future purchases of the product. 

Then no money would be spent on purchasing the 

product or on operating expenses. and the value of 

the savings would equal the amount of money that 

would have been spent without the standard. This 

would clearly be a misrepresentation of the net 

present value of standards. 

"The "rebound effect" is the projected energr 

savings from an efficiency improvement that does 

not occur. This results when purchasers of more energy efficient appliance use them more intensively. thereby saving less energy than the 

engineering estimates would have indicated. In 

some instances. the rebound is zero. 

56428 Federal Register I VoL 59. !\io. 218 I Monday. November 14. 1994 I Proposed Rules 

data and comments on how to consider 

this factor. 

The number of potential purchasers of 

an appliance in new homes is equal to 

the number of new bomes constructed 

each year. The number of potential 

purchasers of appliances in exis!ing. . houses is equal to the number or retmng 

appliances plus (if applicable) a fraction 

of those households that did not 

previously own the product. 

Calculation of market shares. 

Potential purchasers may purchase any 

competing technology within an end 

use or none. For each end use. long-term 

market share elasticities are estimated 

with respect to equipment price. 

operating expense. and income. 

respectively. The effect of-standards is 

expected to be lower operating expense 

and increased equipment price. The 

percentage changes in these quantities 

are used. together with market share 

elasticities. to determine changes in 

market share resulting from standards. 

The model assumes that higher 

equipment prices will decrease sales 

volumes while lower operating . expenses will increase them. The net 

resuit (predicted market share) depends 

on the standard level selected with its 

associated equipment prices and 

operating expenses. 

Usage behavior. For some products 

changing the operating expense results 

in changes in usage behavior. These 

changes are modeled based on usage . 

elasticities in operating expense and 

income. For dishwashers. clothes 

washers and clothes dryers we expect 

these elasticities to be at or near zero; 

usage behavior is not influenced by the 

cost of operating the appliance. On the 

other hand. the popularity of certain 

"energy saving" features. such as air (in 

lieu of heated) drying on dishwashers 

suggests that some consumers alter their 

behavior in response to operating costs. 

The Department requests comments on 

this assumption. 

Energy consumption calculations. The 

total energy consumption per hause for 

each end use and fuel by house type and 

vintage (existing or new) is the product 

of the unit energy consumption 

(accounting for efficiency and capacity 

changes) and usage factor. e.g .• relative 

hours of full-load use for dishwashers. 

The corresponding annual energy 

consumption for all households is the 

annual consumption per household. 

times the number of households of that 

type and vintage. times the fraction of 

those households owning that 

appliance. I ., . 

Aggregate energy consumption IS 

obtained by summing intermediate 

results. For example. national electricity 

consumption for residential . 

dish washing in a pa.'1icular year is the 

sum across house types and house 

Vintages of electricity used by compact 

and standard dishwashers. National 

residential electricity consumption in 

that year is the sum of all end uses of 

electricity consumption in the 

residential sector. 

Model outputs. The principal outputs 

from the LBL-REM for each year are: • Energy consumption by end use 

and fuel. • Total residential energy 

consumption by fuel. • Per-unit equipment price and 

operating expense by product. • Projected annual shipments of 

residential a?pliances. and • Differences in these quantities 

between a base and a standards case. These outputs are provided annually 

(or for selected years) and cumulatively 

over a period of time. e.g., 1999-2030. 

Energy savings are provided annually 

from implementation of standards to the 

-end of the period. Net present value of 

standards is evaluated for each 

reguiated product and for the end use(s) 

comprising the regulated and competing 

products. 

Energy savings are calculated as the 

difference in energy consumption 

between the base case and standards . case. Energy consumption in both the 

base case and standards case includes 

changes in fuel choice or changes in 

usage behavior. Therefore. the energy 

savings capture the net energy savings 

due to regulation. including the effects 

induced by shifts in market share or 

changes in usage behavior. 

Net present value. on the other hand. 

excludes these types of effects. 7 Net 

present value is calculated from per-unit 

changes in equipment and operating 

expenses. multiplied by standards case 

shipments. If the net present value were 

calculated without normalizing \\'ith 

regard to shipments. erroneous results 

would be obtained. If standards caused 

decreased purchases of a product. this 

would appear as an economic benefit; 

namely. less money spent on purchasing 

and using appliances.s If standards 

7 Present nlue is the discounted total value of 

energy consumption during the appliances' 

lifetimes. plus the discounted equipment costs for 

those appliances that are purchased during those 

periods at alternative standards levels. The 

difference between a standards case and a base case is the net present value attributable to amended 

standards. A positive net present value for an appliance at a given standard level indicates that. 

H that standard were adopted. consumers ofthat 

appliance as a whole would save that much more money in fuel costs. discounted to the present. than 

they would pay in increased initial price for e more 

efficient appliance. discounted to the present. 

compared to the base case. 

S Without nonnalization. the greatest economic 

benefit would be obtained by a standard le\'e! that 

resulted in increased purchases. this 

would be incorrectly counted as a cost 

when it reflects consumers' preference 

for the post-standards product. 

Base case usage is assumed in 

calculating the net present value since anv "rebound effect"g reflects the 

consumer's judgment that increased 

usage is worth more than the direct 

energy savings associated with keeping 

usage constant. Therefore. deduction of 

any foregone energy savings resulting 

from a possible "rebound effect," prior 

to calculating the net present value. 

would result in an underestimate of the 

true net present value associated with a given efficiency improvement. 

Other impacts. In determining 

economic justification, the Act directs 

the Department to consider a number of 

different factors. Among these factors 

are requirements that the Department 

consider the economic impact of the 

standard on consumers. In this regard. 

the Act establishes a rebuttable 

presumption that a standard is 

economically justified if the additional 

product costs attributable to the 

standard are less than three times the 

value of the first year energy cost 

savings. Also. the Department is 

required to consider changes in the lifecycle costs resulting from the standard. 

Taking into consideration these 

various requirements. the Department 

calculates: 

• The estimated simple payback of 

additional product costs (based on 

estimated changes in product purchase 

prices) by the energy cost savings 

projected to result from the proposed 

standard. 

• The estimated changes in life-cycle 

costs to the consumer likely to result 

from the proposed standard. and 

• The net present value of estimated 

savings to the Nation of the proposed 

standard. 

The calculation of both consumer lifecycle costs and national net present 

costslbenefits require the use of 

appropriate discount rates. The discount 

rate used in sucb calculations is 

intended to approximate the time-value 

of money of those who would bear the 

additional product prices resulting from. 

resulted in no future purchases of the product. 

Then no money would be spent on purchasing the 

product or on operating expenses. and the value of 

the savings would equal the amount of money that 

would have been spent without the standard. This 

would clearly be a misrepresentation of the net 

present value of standards. 

"The "rebound effect" is the projected energr 

savings from an efficiency improvement that does 

not occur. This results when purchasers of more energy efficient appliance use them more intensively. thereby saving less energy than the 

engineering estimates would have indicated. In 

some instances. the rebound is zero. 
Federal Register I Vol. 59. No. 218 I Monday. NovemLer 14. 1994 I Proposed Rules

56429

a proposed standard and who would

also. presumably. benefit from the

resulting savings in energy expenses.

Consequently. the most appropriate

discount rate depends on the

characteristics of the individual

consumers. businesses. or other persons

effected by a proposed standard. The

Department expects to use the same

discount rates for this notice as are

selected as a result of the Three Product

Advf~'1ce Notice. The Department

welcomes comments un this issue.

The Department recognizes that there

are external societal benefits (and

possibly costs) that are ~enerated from

ilnniiance stnndards. These are

r:~{nc:ipally the value of reductions in oil

imports and the reduction in projected

emis>:ions of SO:!. NO:! and CO2. It has

been suggested that the appliance

standaros resulting from this

n:lemekL;g will not create anv S02 or

NO: Slivings beyond those that will be

1'30uired bv the Clean Air Act of 1990

(?L. 101-549. November 15. 1990). If

[hat pzo\'es to be tme. then the

c;r.lssions reductions from standa;:ds

that de occur will accrue to those

deriving the reductions (which are

principally electric utilitiesj by

displacing the measures iliat those firms

\\-'ouid otherwise utilize to achieve their

required reductions of S02 and N02• In

that case, the S02 and 1'102 reductions

from standards would renresent a costf.-ae wav for those firms to achieve their

savings: and. as such. would have some

value to tnose firms realizing the

redl.:ctions. The actual volue that will be

realized from appliance standardsi:1duced reducdcns of S02 will be the

marKet-determined dollar value placed

on the noilution creciits that are earned.

Such credits can be used bv the fl~

realizing the credits, "banked" for

future use. or sold for use or "banking"

tv ntners.

. In previous rulemakings, the

Department identified benefits resulting

from national energy savings and

emissions reductions, but did not attach

an\' monetary value to these benefits

because of the considerable uncertaintv

of such estimates. However, in order .

more explicitly to consider such

externalized benefits (or costs), the

Department will attempt in this

mlemaking to establish values for these

benefits. if a sound analytical basis can

be found. The Department has recently

published a Supplemental Advance

Notice (59 FR 51140, October 7, 1994)

to the Three Product Advance Notice;

this Supplemental Advance Notice

presents considerations that would need

[0 be made in developing a sound

'lnalytic basis for monetizing

externalities.

The Department is concerned about

the impact to any identifiable groups or

consumers who may be

disproportionally affected by any

proposed national energy efficiency

standard levels. The Department

requested comments on a methodolcgy

for addressing this issue in the Three

Product Advance Notice. The

Department expects to follow the policy

regarding the consideration of such

disproportionate impacts that emerges

from the consideration cf comments on

the Three Product Advance Notice in

this rulemaking. The Department

v,:elcomes commen\s on this issue.

2. Electric Power Research Institutes

Residential End-Use Er:ergy Planning

System (REEFS 2.12)

REEPS has been used since the early

1980s both as a tool for national .

residential policy analysis epd

subsequently as an analyticd tool for

electric utilities to forecast long-term

residential ener"v derr.:md. The current

version of the model, REEPS 2.12.

simulates the energy consumption

behavior of specific household

segments.

REEPS 2.12 incorporates the basic

features of residential end-use

fcrecasting into a generalized modeling

framework in which the user has

considerable control over the algorithms

and model stmctu."e. This framework

provides greater flexibility over more

traditional models which are

"hardwired" for particular formulations

cf residential sector energy use. This '

facilitates implementation of a wide

range of scenarios and policies at

va..-ying Je,'els of disaggregation without

ever changing the computer program

itself.

Space conditioning and appliance

modeling. REEPS 2.12 provides a

separate modeling framework for space

. conditioning end-uses and another for

household appliances. like refrigerators.

clothes washers. etc. These frameworks

are referred to as the HVAC module and

appliance modules. Exogenous variables

include macroeconomic projections

such as income and household size and

other external r.arameters specified by

the user. Fuel price projections are

implemented as exogenous time series

for each rolel and rate class used in the

model. Household data allows the user

to forecast changes to the housing stock

based on se!larate decay rates for each

housing type and vintage block.

H\'AC module/thermal shell. REEPS

2.12 has an HVAC module which deals

with space conditioning equipment and

the thermal shell. The module has

various parameters such as fuel choice,

system Capacity. efficiency levels. etc..

The Department believes that these

issues will not be a factor in the analvsis

for the three cleaning products because

these products do not impact the

thermal characteristics of the dwelling.

The Department welcomes cor::ments

on this assumption.

Appliance module. The REEFS 2.12

Appliance Model provides-a generalized

structure fer characterizing purchases

and energy consumption of appliances.

This model will be used to analvze the

three cleaning products if the -

Department decides to adopt REEFS.

Working within the R...1:'EPS framework.

users of the model configure economic

and energy data on appliances and

define functional relationships to model

changes in energy consumption in

future years. Demographic segmentation

allows the user to define different

segments of L~e appliance market based

on household characteristics such as

income or household size and

differentiate purchase decisions across

these segments. These other mput selS

precede~the specificanon of tl;e

appliance models t...'1emselves because

they define important elements of

appliance model structure. such as the

housing types specifiad in the

Households module. Data from these

input sets are used as drivers i:l.

forecasting the size. characteristics. and

usage of the appliance stock.

The REEPS 2.12 Appliance Model is

a vintaged capital stock or stock Dowadjustment model that maintains

accoun~s of appliances by vintage year.

REEPS 2.12 uses a state-based approach

to forecasting in which purchase

decisions are exolicitlv modeled at the

household level: The state-based

approach differs from a saturation

approacil to appliance modeling. in

which the saturations or market ~hares

are modeled and the difference from the

current ownership patterns are

attributed to appliance purchases. The

"state" of a given appliance model in a

given year determines the energy

consumption for that applia..'1ce by

tracking five key variables throughout

the course of the forecast: size.

efficiency. usage. market share and the

number of households. Appliance size.

efficiency and usage are defined by the

user in the units-and values appropriate

for a given end-use and/or appliance.

Three general modeling steps are

executed for each a!lpliance end-use: (1)

Base-year calibration. (2) decisionmodel c~libration,and (3) forecast

execution. In the base-vear calibr:ltion.

the Appliance Model is compared \-\'ith

the input housing stock and

demographic characteristics to check for

'.alues that are disaggregated by housip.g

type and demographic segment. Usa~e is

 EE-RM-94-403 COMMENT 101C

Federal Register I Vol. 59. No. 218 I Monday. NovemLer 14. 1994 I Proposed Rules 56429 

a proposed standard and who would 

also. presumably. benefit from the 

resulting savings in energy expenses. 

Consequently. the most appropriate 

discount rate depends on the 

characteristics of the individual 

consumers. businesses. or other persons 

effected by a proposed standard. The 

Department expects to use the same 

discount rates for this notice as are 

selected as a result of the Three Product 

Advf~'1ce Notice. The Department 

welcomes comments un this issue. 

The Department recognizes that there 

are external societal benefits (and 

possibly costs) that are ~enerated from 

3nniia:1ce standards. These are 

p~{nc:ipally the value of reductions in oil 

imports and the reduction in projected 

emis>:ions of SO:!. NO:! and CO2• It has 

been suggested that the appliance 

standaros resulting from this 

n:lemekL:g will not create anv SOl or 

NO: Sli \lings beyond those that will be 

1'30uired bv the Clean Air Act of 1990 

(?L. 101-549. November 15. 1990). If 

[hat PZO\'E'S to be true. then the 

GGlssions reductions from standa;:ds 

that de occur will accrue to those 

deriving the reductions (which are 

principally electric utilitiesj by 

displacing the measures tnat those firms 

\v'ouid otherwise utilize to achieve their 

required reductions of S02 and N02• In 

(bat case, the S02 and 1'102 reductions 

from standards would renresent a costf.-ae wav for those firms to achieve their 

savings: and. as such. would have some 

value to those firms realizing the 

recil.:ctions. The actual volue that will be 

realized from appliance standardsi:1duced reducticns of S02 will be the 

marKet-determined dollar value placed 

on the noilution creciits that are earned. 

Such credits can be used bv the fl~ 

realizing the credits. "banked" for 

future use. or sold for use or "banking·' 

tv ntners. 

. In previous rulemakings. the 

Department identified benefits resulting 

from national energy savings and 

emissions reductions. but did not attach 

an .... monetary value to iliese benefits 

because of ilie considerable uncertaintv 

of such estimates. However. in order -

more explicitly to consider such 

externalized benefits (or costs). the 

Department will attempt in this 

rulemaking to establish values for these 

benefits. if a sound analytical basis can 

be found. The Department has recently 

published a Supplemental Advance 

Notice (59 FR 51140. October 7. 1994) 

to the Three Product Advance Notice: 

this Supplemental Advance Notice 

presents considerations that would need 

[0 be made in developing a sound 

'lnalytic basis for monetizing 

externalities. 

The Department is concerned about 

the impact to any identifiable groups or 

consumers who mav be 

disproportionally affected by any 

proposed national energy efficiency 

standard levels. The Department 

requested comments on a methodolcgy 

for addressing this issue in the Three 

Product Advance Notice. The 

Department expects to follow the policy 

regarding the consideration of such 

disproportionate impacts that emerges 

from the consideration cf comments on 

the Three Product Advance Notice in 

this rulemaking. The Departme:1t 

v,:elcomes commen\s on this issue. 

2. Electric Power Research Institutes 

Residential End-Use Er:ergy Planning 

System (REEFS 2.12) 

REEPS has been used since the early 

1980s both as a tool for national -

residential policy analysis epa 

subsequently as an analyticd tool for 

electric utilities to forecast long-term 

residential en8r~\' derr.:md. The current 

version of the model. REEPS 2.12. 

simulates the energy consurnptio!1 

behavior of specific household 

segments. 

REEPS 2.12 incorporates the basic 

features of residential end-use 

fcrecasting into a generalized modeling 

framework in which the user has 

considerable control over the algorithms 

and model structlli"e. This framework 

provides greater flexibility over more 

traditional models which are 

"hardwired" for particular formulations 

cf residential sector energy use. This ' 

facilitates implementation cf a wide 

range of scenarios and policies at 

\·a.-ying Je\-els of dis3Qgregation without 

ever changing the computer program 

itself. 

Space conditioning and appliance 

modeling. REEPS 2.12 provides a 

separate modeling framework for space 

. conditioning end-uses and another for 

household appliances. like refrigerators, 

clothes washers. etc. These frameworks 

are referred to as the HV AC module and 

appliance modules. Exogenous variables 

include macroeconomic projections 

such as income and household size and 

other external r.arameters specified by 

the user. Fuel price projections are 

implemented as exogenous time series 

for each r.lel and rate class used in the 

model. Household data allows the user 

to forecast changes to the housing stock 

based on se!larate decay rates for each 

housing type and vintage block. 

H\fAC module/thermal shell. REEPS 

2.12 has an HVAC module which deals 

with space ccnditioning equipment and 

the thermal shell. The module has 

various parameters such as fuel choice. 

system Capacity. effiCiency levels. etc .. 

The Department believes that these 

issues will not be a factor in the analysis 

for the three cleaning products because 

these products do not impact the 

thermal characteristics of the dweiling. 

The Department welcomes cor::rnpnts 

on this assumption. 

Appliance module. The REEFS 2.12 

Appliance Model provides·a generalized 

structure fer characterizing purchases 

and energy consumption of appliances. 

This model will be used to analne the 

three cleaning products if the -

Department decides to adopt REEFS. 

Working within the R...1:'EPS framework. 

users of the model configure economic 

and energy data on appliances and 

define functional relationships to model 

changes in energy consumption in 

future years. Demographic segmentation 

allows the user to define different 

segments of L~e appliance market based 

on household characteristics such as 

income or household size and 

differentiate purchase decisions across 

these segments. These other mput selS 

precede ~the specificauon of t:,e 

appliance models t...'Iemselves because 

they define important elements of 

appliance model structure. such as the 

housing types specifiad in the 

Households module. Data from these 

input sets are used as drivers i:! 

forecasting the size. characteristics. and 

usage of the appliance stock. 

The REEPS 2.12 Appliance Model is 

a vintaged capital stock or stock fiowadjustmer:t model that maintains 

accoun~s of appliances by vintage year. 

REEPS 2.12 uses a state-based approach 

to forecasti:1g in which purchase 

decisions are exolicitlv modeled at the 

household level: The siate-based 

approach differs from a saturation 

approacil to appliance modeling. in 

which the saturations or market ~hares 

are modeled and the difference f!'om the 

current ownership patterns are 

attributed to appliance purchases. The 

"state" of a given appliance model in a 

given year determines the energy 

consumption for that app!ia..'lce by 

tracking five key variables throughout 

ilie course of the forecast: size. 

efficiency, usage. market share and the 

number of households. Appliance size. 

efficiency and usage are defined by the 

user in the units-and values appropriate 

for a given end-use and/or appliance. 

Three general modeling steps are 

executed for each a!lpliance end-use: (1) 

Base-year calibration. (2) decisionmodel c~libration. and (3) forecast 

execution. In the base-year calibr:ltion, 

the Appliance Model is compared \\'ith 

the input housing stock and 

demographic characteristics to check for 

';alues that are disaggregated by housing 

type and demographic segment. Usa~e is 

Federal Register I Vol. 59. No. 218 I Monday. NovemLer 14. 1994 I Proposed Rules 56429 

a proposed standard and who would 

also. presumably. benefit from the 

resulting savings in energy expenses. 

Consequently. the most appropriate 

discount rate depends on the 

characteristics of the individual 

consumers. businesses. or other persons 

effected by a proposed standard. The 

Department expects to use the same 

discount rates for this notice as are 

selected as a result of the Three Product 

Advf~'1ce Notice. The Department 

welcomes comments un this issue. 

The Department recognizes that there 

are external societal benefits (and 

possibly costs) that are ~enerated from 

3nniia:1ce standards. These are 

p~{nc:ipally the value of reductions in oil 

imports and the reduction in projected 

emis>:ions of SO:!. NO:! and CO2• It has 

been suggested that the appliance 

standaros resulting from this 

n:lemekL:g will not create anv SOl or 

NO: Sli \lings beyond those that will be 

1'30uired bv the Clean Air Act of 1990 

(?L. 101-549. November 15. 1990). If 

[hat PZO\'E'S to be true. then the 

GGlssions reductions from standa;:ds 

that de occur will accrue to those 

deriving the reductions (which are 

principally electric utilitiesj by 

displacing the measures tnat those firms 

\v'ouid otherwise utilize to achieve their 

required reductions of S02 and N02• In 

(bat case, the S02 and 1'102 reductions 

from standards would renresent a costf.-ae wav for those firms to achieve their 

savings: and. as such. would have some 

value to those firms realizing the 

recil.:ctions. The actual volue that will be 

realized from appliance standardsi:1duced reducticns of S02 will be the 

marKet-determined dollar value placed 

on the noilution creciits that are earned. 

Such credits can be used bv the fl~ 

realizing the credits. "banked" for 

future use. or sold for use or "banking·' 

tv ntners. 

. In previous rulemakings. the 

Department identified benefits resulting 

from national energy savings and 

emissions reductions. but did not attach 

an .... monetary value to iliese benefits 

because of ilie considerable uncertaintv 

of such estimates. However. in order -

more explicitly to consider such 

externalized benefits (or costs). the 

Department will attempt in this 

rulemaking to establish values for these 

benefits. if a sound analytical basis can 

be found. The Department has recently 

published a Supplemental Advance 

Notice (59 FR 51140. October 7. 1994) 

to the Three Product Advance Notice: 

this Supplemental Advance Notice 

presents considerations that would need 

[0 be made in developing a sound 

'lnalytic basis for monetizing 

externalities. 

The Department is concerned about 

the impact to any identifiable groups or 

consumers who mav be 

disproportionally affected by any 

proposed national energy efficiency 

standard levels. The Department 

requested comments on a methodolcgy 

for addressing this issue in the Three 

Product Advance Notice. The 

Department expects to follow the policy 

regarding the consideration of such 

disproportionate impacts that emerges 

from the consideration cf comments on 

the Three Product Advance Notice in 

this rulemaking. The Departme:1t 

v,:elcomes commen\s on this issue. 

2. Electric Power Research Institutes 

Residential End-Use Er:ergy Planning 

System (REEFS 2.12) 

REEPS has been used since the early 

1980s both as a tool for national -

residential policy analysis epa 

subsequently as an analyticd tool for 

electric utilities to forecast long-term 

residential en8r~\' derr.:md. The current 

version of the model. REEPS 2.12. 

simulates the energy consurnptio!1 

behavior of specific household 

segments. 

REEPS 2.12 incorporates the basic 

features of residential end-use 

fcrecasting into a generalized modeling 

framework in which the user has 

considerable control over the algorithms 

and model structlli"e. This framework 

provides greater flexibility over more 

traditional models which are 

"hardwired" for particular formulations 

cf residential sector energy use. This ' 

facilitates implementation cf a wide 

range of scenarios and policies at 

\·a.-ying Je\-els of dis3Qgregation without 

ever changing the computer program 

itself. 

Space conditioning and appliance 

modeling. REEPS 2.12 provides a 

separate modeling framework for space 

. conditioning end-uses and another for 

household appliances. like refrigerators, 

clothes washers. etc. These frameworks 

are referred to as the HV AC module and 

appliance modules. Exogenous variables 

include macroeconomic projections 

such as income and household size and 

other external r.arameters specified by 

the user. Fuel price projections are 

implemented as exogenous time series 

for each r.lel and rate class used in the 

model. Household data allows the user 

to forecast changes to the housing stock 

based on se!larate decay rates for each 

housing type and vintage block. 

H\fAC module/thermal shell. REEPS 

2.12 has an HVAC module which deals 

with space ccnditioning equipment and 

the thermal shell. The module has 

various parameters such as fuel choice. 

system Capacity. effiCiency levels. etc .. 

The Department believes that these 

issues will not be a factor in the analysis 

for the three cleaning products because 

these products do not impact the 

thermal characteristics of the dweiling. 

The Department welcomes cor::rnpnts 

on this assumption. 

Appliance module. The REEFS 2.12 

Appliance Model provides·a generalized 

structure fer characterizing purchases 

and energy consumption of appliances. 

This model will be used to analne the 

three cleaning products if the -

Department decides to adopt REEFS. 

Working within the R...1:'EPS framework. 

users of the model configure economic 

and energy data on appliances and 

define functional relationships to model 

changes in energy consumption in 

future years. Demographic segmentation 

allows the user to define different 

segments of L~e appliance market based 

on household characteristics such as 

income or household size and 

differentiate purchase decisions across 

these segments. These other mput selS 

precede ~the specificauon of t:,e 

appliance models t...'Iemselves because 

they define important elements of 

appliance model structure. such as the 

housing types specifiad in the 

Households module. Data from these 

input sets are used as drivers i:! 

forecasting the size. characteristics. and 

usage of the appliance stock. 

The REEPS 2.12 Appliance Model is 

a vintaged capital stock or stock fiowadjustmer:t model that maintains 

accoun~s of appliances by vintage year. 

REEPS 2.12 uses a state-based approach 

to forecasti:1g in which purchase 

decisions are exolicitlv modeled at the 

household level: The siate-based 

approach differs from a saturation 

approacil to appliance modeling. in 

which the saturations or market ~hares 

are modeled and the difference f!'om the 

current ownership patterns are 

attributed to appliance purchases. The 

"state" of a given appliance model in a 

given year determines the energy 

consumption for that app!ia..'lce by 

tracking five key variables throughout 

ilie course of the forecast: size. 

efficiency, usage. market share and the 

number of households. Appliance size. 

efficiency and usage are defined by the 

user in the units-and values appropriate 

for a given end-use and/or appliance. 

Three general modeling steps are 

executed for each a!lpliance end-use: (1) 

Base-year calibration. (2) decisionmodel c~libration. and (3) forecast 

execution. In the base-year calibr:ltion, 

the Appliance Model is compared \\'ith 

the input housing stock and 

demographic characteristics to check for 

';alues that are disaggregated by housing 

type and demographic segment. Usa~e is 
5~430

UP.

Federal Register I Vol. 59, No. 218 I Monday, November 14, 1994 I Proposed R~lles

edjusted to be consistent with stock

Unit Energy Consumption values and

vintage block information on vintage

block shares, efficiencies and sizes. In

the second step, decision-model

calibration. the decision models are

adjusted to fit the control values

specified in the first forecast year. These

con.trol values are referred to as .

"control-vear" data. and include the

marginal'appliai1ce efficiencies and new

purchase shares. Finally, in the forecast

execution step. decision models are

used to predict new appliance

ownership shares and efficiency

choices. The algorithmic procedures in

each of these three steps are detailed in

the technical documentation for the

Appliance Model.

Policy modeling. The flexibility of

REEPS 2.1 allows the user to model a

number of policies through the

judicious modification of the

appropriate parameters. equations.

structure. and addition of new technologies. Government and utility

policies have the potential to restrict

appliance efficiency levels. energy

prices. financial criteria for new equipment purchases. early retirement

of appliances. and rates of technical

innovation. The policy choices in

REEFS 2.12 include: Energy prices,

functional forms and coefficients for

choice equations. pre-failure

replacement conversion decision

algorithm. restrictions on legal or

market availability ofspecific

technologies. and modification of

specific technologies. purchase prices or

efficiencies.

c. Manufacturer Impact Models

1. Conceptual Approach

The manufacturer impact analysis

estimates the overall impact of new or

amended standards on an industry's

profitability and scale of operation.

2. Measures of Impact

The analysis examines two types of

long-run impact: profitability and

growth. Consequently. five measures of

impact are reported. They are:

shipments. prices, revenues, net

incomes and returns on equity. Return

on equity is the primary measure of

profitability. assets and income provide

the primary measures of growth. At the

request j)f appliance manufacturers, a

new measure. net present value of the

mdustry. will also be reported.

Two short-run impacts are also

analyzed. First, the ability of the

industry to provide the one-time

investments required to meet the new

standard is examined. Second, if

standards result in decreased sales for

!pe particular industry being analyzed.

the analysis examines the possibility of

price-cutting while the industry is

adjusting to a lower sales volume.

3. Lawrence Berkeley Laboratory

Manufacturer Impact Model

In order to estimate the impacts of

energy efficiency standards. a computer

spreadsheet model. the Lawrence

Berkeley Laboratory Manufacturer

Impact Model (LBL-MIM), was

developed.

The LBL-MIM was developed at

Lawrence Berkeley Laboratory in 1988.

Since its inception. it has evolved and

has been used in the analysis and

reanalysis for numerous Department

rulemakings.

The LBL-MIM models the cumulative

effects of standards on the future of the

industry. and by means of present value

formulas presents the effects on an

annualized basis.

Ideallv. a manufacturer analvsis

should iook at the impact of a proposed

regulation on every firm that does

business in the industry under question.

However. because the industries being

analyzed have many manufacturers

making a particular product. a firm-byfirm analysis is not feasible. In addition.

the engineering and financial data for

most manufacturing firms are proprietary and are not routinely

available for public analysis. Because of

these limitations on data and resources. the LBL-MIM models a prototypical

firm. In many cases this firm represents a division of a larger firm. Therefore. a

prototype firm is a hypothetical firm

representative of a portion of the

industry. Prototypical firms are defined

by parameters that are important for

determining the impacts of standards

and are consistent with data for the

portion of the industry.they represent.

Important parameters used in the .model

include the cost structure of the firms.

profitability ratios. relative costs of

complying with the new standard, and

marketing strategies.

Revenue is affected by both price and

shipments. Price is determined by

computing the markup over long-run

marginal costs and then using the

markup to determine an optimal price.

Demand is determined by price and

operating expense elasticities, coupled

with the changes in price and operating

expenses resulting from the standards.

The LBL-MIM produces several

outputs used in analyzing the impact of

standards on manufacturers. A

simplified pro forma income statement

is prepared for each prototypical firm.

In addition to the income statement, five

main variables-shipments. prices.

revenues. net incomes, and returns on

equity-are reported. The results are

presented for the without-standards (or

without amended standards) case and

the with-standards (or with amended

standards) case. and the relative

differences between the two are also

given.

4. Integration of the La\\TenCe Berkeley

Laboratory Manufacturer Impact Model

and the Government Regulatory Impact

Model

As part of its comments submitted to

the Department for the rulemaking on

nine consumer products (comments No.

610 and 61E dated July 1991 and

September 9, 1991. respectively), the

Association of Home Appliance

Manufacturers (AHAM) proposed an

alternate approach to the LBL-MIM for

the analysis of manufacturer impacts.

The AHAM's approach was formalized

as a computer spreadsheet by the Arthur

D. Little consulting firm. It was named

the Government Regulatory Impact

Model (GRIM) and was formallv

proposed to DOE by representatives of

the AHAM. the Air-Conditi9ning and

Refrigeration Institute. the Gas

Appliance Manufacturers Association.

and Arthur D. Little on April 15. 1993.

.The primary functional differences

between GRIM and LBL-MIM are

GRIM's use of an annual cash-flow

analysis for manufacturer costs and

restriction to cost predictions. DOE has

analyzed the GRIM's cost approach and

found that. given identical inputs, its

results were similar enough to those of

the cost section of the LBL-MIM that

the LBL-MIM outputs are not

significantly affected by the use of the

GRIM. Because the cash-flow approach

to manufacturer costs is simpler and

more transparent to the industry. DOE

intends to analvze the GRIM costanalysis methodology and may integrate

the model into the LBL-MIM as a

replacement for the cost 8J.'1alysis section

ofthe LBL-MIM. The analysis of the

GRIM and possible adoption will be

determined in the Three Product

Advance Notice rulemaking and 'the

Department expects to use the same

methodology in this rulemaking. The

Department welcomes comments on this

issue.

Ifthe GRIM is adopted. then the

capabilities of the LBL-MIM necessary

to the analysis but not found in the

GRIM. such as price and shipments

forecasting. will be retained. The

GRIM's measure of impact and industry

net present value would be included as

part of the LBL-MIM's primary

measures of impact.

 EE-RM-94-403 COMMENT 101C

5~430 Federal Register I Vol. 59, No. 218 I Monday, November 14, 1994 I Proposed R~lles u= 

edjusted to be consistent with stock $e particular industry being analyzed. 

Unit Energy Consumption values and the analysis examines the possibility of 

vintage block information on vintage price-cutting while the industry is 

block shares. efficiencies and sizes. In adjusting to a lower sales volume. 

the second step. decision-model 3. Lawrence Berkeley Laboratory 

calibration. the decision models are Manufacturer Impact Model adjusted to fit the control values 

specified in the first forecast year. These In order to estimate the impacts of 

control values are referred to as . energy efficiency standards. a computer 

"control-vear" data. and include the spreadsheet model. the Lawrence 

marginal "appliai1ce efficiencies and new Berkeley Laboratory Manufacturer 

purchase shares. Finally. in the forecast Impact Model (LBL-MIM), was 

execution step. decision models are developed. 

used to predict new appliance The LBL-MIM was developed at 

ownership shares and efficiency Lawrence Berkeley Laboratory in 1988. 

choices. The algorithmic procedures in Since its inception. it has evolved and 

each of these three steps are detailed in has been used in the analysis and 

the technical documentation for the reanalysis for numerous Department rulemakings. Appliance Model. The LBL-MIM models the cumulative 

Policy modeling. The flexibility of effects of standards on the future of the 

REEPS 2.1 allows the user to model a number of policies through the industry. and by means of present value 

formulas presents the effects on an 

judicious modification of the annualized basis. 

appropriate parameters, equations. Ideallv. a manufacturer analvsis 

structure. and addition of new should iook at the impact of a proposed 

technologies. Government and utility regulation on every firm that does 

policies have the potential to restrict business in the industry under question. 

appliance efficiency levels, energy However. because the industries being 

prices. financial criteria for new analyzed have many manufacturers 

equipment purchases, early retirement making a particular product, a firm-byof appliances, and rates of technical firm analysis is not feasible. In addition. 

innovation. The policy choices in the engineering and financial data for 

REEFS 2.12 include: Energy prices. most manufacturing firms are 

functional forms and coefficients for proprietary and are not routinely 

choice equations. pre-failure available for public analysis. Because of 

replacement conversion decision these limitations on data and resources. 

algorithm, restrictions on legal or the LBL-MIM models a prototypical 

market av~ilability of speci~c firm. In many cases this firm represents 

tecru:ologles, and ~odlfication of. ' a division of a larger firm. Therefore, a spec~fic ~echnologles, purchase pnces or prototype firm is a hypothetical firm 

efficlencles. representative of a portion of the 

c. Manufacturer Impact Models industry. Prototypical firms are defined 

by parameters that are important for 

1. Conceptual Approach determining the impacts of standards 

The manufacturer impact analysis and are consistent with data for the 

estimates the overall impact of new or portion of the industry .they represent. 

amended standards on an industry's Important parameters used in the .model 

profitability and scale of operation. include the cost structure of the firms. 

2. Measures of Impact 

The analysis examines two types of 

long-run impact: profitability and 

growth. Consequently. five measures of 

impact are reported. They are: 

shipments. prices, revenues, net 

incomes and returns on equity. Return 

on equity is the primary measure of 

profitability. assets and income provide 

the primary measures of growth. At the 

request j)f appliance manufacturers. a 

new measure. net present value of the 

mdustry. will also be reported. 

Two short-run impacts are also 

analyzed. First, the ability of the 

industry to provide the one-time 

investments required to meet the new 

standard is examined. Second. if 

standards result in decreased sales for 

profitability ratios. relative costs of 

complying with the new standard. and 

marketing strategies. 

Revenue is affected by both price and 

shipments. Price is determined by 

computing the markup over long-run 

marginal costs and then using the 

markup to determine an optimal price. 

Demand is determined by price and 

operating expense elasticities, coupled 

with the changes in price and operating 

expenses resulting from the standards. 

The LBL-MIM produces several 

outputs used in analyzing the impact of 

standards on manufacturers. A 

simplified pro forma income statement 

is prepared for each prototypical firm. 

In addition to the income statement. five 

main variables-shipments. prices. 

revenues. net incomes, and returns on 

equity-are reported. The results are 

presented for the without-standards (or 

without amended standards) case and 

the with-standards (or with amended 

standards) case. and the relative 

differences between the two are also 

given. 

4. Integration of the La\\TenCe Berkeley 

Laboratory Manufacturer Impact Model 

and the Government Regulatory Impact 

Model 

As part of its comments submitted to 

the Department for the rulemaking on 

nine consumer products (comments No. 

610 and 61E dated July 1991 and 

September 9, 1991, respectively). the 

Association of Home Appliance 

Manufacturers (AHAM) proposed an 

alternate approach to the LBL-MIM for 

the analysis of manufacturer impacts. 

The AHAM's approach was formalized 

as a computer spreadsheet by the Arthur 

D. Little consulting firm. It was named 

the Government Regulatory Impact 

Model (GRIM) and was formaHv 

proposed to DOE by representatives of 

the AHAM, the Air-Conditi9ning and 

Refrigeration Institute, the Gas 

Appliance Manufacturers Association. 

and Arthur D. Little on April 15, 1993. 

. The primary functional differences 

between GRIM and LBL-MIM are 

GRIM's use of an annual cash-flow 

analysis for manufacturer costs and 

restriction to cost predictions. DOE has 

analyzed the GRIM's cost approach and 

found that. given identical inputs, its 

results were similar enough to those of 

the cost section of the LBL-MIM that 

the LBL-MIM outputs are not 

significantly affected by the use of the 

GRIM. Because the cash-flow approach 

to manufacturer costs is simpler and 

more transparent to the industry. DOE 

intends to analvze the GRIM costanalysis methodology and may integrate 

the model into the LBL-MIM as a 

replacement for the cost 8.t"1alysis section 

of the LBL-MIM. The analysis of the 

GRIM and possible adoption will be 

determined in the Three Product 

Advance Notice rulemaking and 'the 

Department expects to use the same 

methodology in this rulemaking. The 

Department welcomes comments on this 

issue. 

If the GRIM is adopted, then the 

capabilities of the LBL-MIM necessary 

to the analysis but not found in the 

GRIM, such as price and shipments 

forecasting, will be retained. The 

GRIM's measure of impact and industry 

net present value would be included as 

part of the LBL-MIM's primary 

measures of impact. 

.. ~ 

5~430 Federal Register I Vol. 59, No. 218 I Monday, November 14, 1994 I Proposed R~lles u= 

edjusted to be consistent with stock $e particular industry being analyzed. 

Unit Energy Consumption values and the analysis examines the possibility of 

vintage block information on vintage price-cutting while the industry is 

block shares. efficiencies and sizes. In adjusting to a lower sales volume. 

the second step. decision-model 3. Lawrence Berkeley Laboratory 

calibration. the decision models are Manufacturer Impact Model adjusted to fit the control values 

specified in the first forecast year. These In order to estimate the impacts of 

control values are referred to as . energy efficiency standards. a computer 

"control-vear" data. and include the spreadsheet model. the Lawrence 

marginal "appliai1ce efficiencies and new Berkeley Laboratory Manufacturer 

purchase shares. Finally. in the forecast Impact Model (LBL-MIM), was 

execution step. decision models are developed. 

used to predict new appliance The LBL-MIM was developed at 

ownership shares and efficiency Lawrence Berkeley Laboratory in 1988. 

choices. The algorithmic procedures in Since its inception. it has evolved and 

each of these three steps are detailed in has been used in the analysis and 

the technical documentation for the reanalysis for numerous Department rulemakings. Appliance Model. The LBL-MIM models the cumulative 

Policy modeling. The flexibility of effects of standards on the future of the 

REEPS 2.1 allows the user to model a number of policies through the industry. and by means of present value 

formulas presents the effects on an 

judicious modification of the annualized basis. 

appropriate parameters, equations. Ideallv. a manufacturer analvsis 

structure. and addition of new should iook at the impact of a proposed 

technologies. Government and utility regulation on every firm that does 

policies have the potential to restrict business in the industry under question. 

appliance efficiency levels, energy However. because the industries being 

prices. financial criteria for new analyzed have many manufacturers 

equipment purchases, early retirement making a particular product, a firm-byof appliances, and rates of technical firm analysis is not feasible. In addition. 

innovation. The policy choices in the engineering and financial data for 

REEFS 2.12 include: Energy prices. most manufacturing firms are 

functional forms and coefficients for proprietary and are not routinely 

choice equations. pre-failure available for public analysis. Because of 

replacement conversion decision these limitations on data and resources. 

algorithm, restrictions on legal or the LBL-MIM models a prototypical 

market av~ilability of speci~c firm. In many cases this firm represents 

tecru:ologles, and ~odlfication of. ' a division of a larger firm. Therefore, a spec~fic ~echnologles, purchase pnces or prototype firm is a hypothetical firm 

efficlencles. representative of a portion of the 

c. Manufacturer Impact Models industry. Prototypical firms are defined 

by parameters that are important for 

1. Conceptual Approach determining the impacts of standards 

The manufacturer impact analysis and are consistent with data for the 

estimates the overall impact of new or portion of the industry .they represent. 

amended standards on an industry's Important parameters used in the .model 

profitability and scale of operation. include the cost structure of the firms. 

2. Measures of Impact 

The analysis examines two types of 

long-run impact: profitability and 

growth. Consequently. five measures of 

impact are reported. They are: 

shipments. prices, revenues, net 

incomes and returns on equity. Return 

on equity is the primary measure of 

profitability. assets and income provide 

the primary measures of growth. At the 

request j)f appliance manufacturers. a 

new measure. net present value of the 

mdustry. will also be reported. 

Two short-run impacts are also 

analyzed. First, the ability of the 

industry to provide the one-time 

investments required to meet the new 

standard is examined. Second. if 

standards result in decreased sales for 

profitability ratios. relative costs of 

complying with the new standard. and 

marketing strategies. 

Revenue is affected by both price and 

shipments. Price is determined by 

computing the markup over long-run 

marginal costs and then using the 

markup to determine an optimal price. 

Demand is determined by price and 

operating expense elasticities, coupled 

with the changes in price and operating 

expenses resulting from the standards. 

The LBL-MIM produces several 

outputs used in analyzing the impact of 

standards on manufacturers. A 

simplified pro forma income statement 

is prepared for each prototypical firm. 

In addition to the income statement. five 

main variables-shipments. prices. 

revenues. net incomes, and returns on 

equity-are reported. The results are 

presented for the without-standards (or 

without amended standards) case and 

the with-standards (or with amended 

standards) case. and the relative 

differences between the two are also 

given. 

4. Integration of the La\\TenCe Berkeley 

Laboratory Manufacturer Impact Model 

and the Government Regulatory Impact 

Model 

As part of its comments submitted to 

the Department for the rulemaking on 

nine consumer products (comments No. 

610 and 61E dated July 1991 and 

September 9, 1991, respectively). the 

Association of Home Appliance 

Manufacturers (AHAM) proposed an 

alternate approach to the LBL-MIM for 

the analysis of manufacturer impacts. 

The AHAM's approach was formalized 

as a computer spreadsheet by the Arthur 

D. Little consulting firm. It was named 

the Government Regulatory Impact 

Model (GRIM) and was formaHv 

proposed to DOE by representatives of 

the AHAM, the Air-Conditi9ning and 

Refrigeration Institute, the Gas 

Appliance Manufacturers Association. 

and Arthur D. Little on April 15, 1993. 

. The primary functional differences 

between GRIM and LBL-MIM are 

GRIM's use of an annual cash-flow 

analysis for manufacturer costs and 

restriction to cost predictions. DOE has 

analyzed the GRIM's cost approach and 

found that. given identical inputs, its 

results were similar enough to those of 

the cost section of the LBL-MIM that 

the LBL-MIM outputs are not 

significantly affected by the use of the 

GRIM. Because the cash-flow approach 

to manufacturer costs is simpler and 

more transparent to the industry. DOE 

intends to analvze the GRIM costanalysis methodology and may integrate 

the model into the LBL-MIM as a 

replacement for the cost 8.t"1alysis section 

of the LBL-MIM. The analysis of the 

GRIM and possible adoption will be 

determined in the Three Product 

Advance Notice rulemaking and 'the 

Department expects to use the same 

methodology in this rulemaking. The 

Department welcomes comments on this 

issue. 

If the GRIM is adopted, then the 

capabilities of the LBL-MIM necessary 

to the analysis but not found in the 

GRIM, such as price and shipments 

forecasting, will be retained. The 

GRIM's measure of impact and industry 

net present value would be included as 

part of the LBL-MIM's primary 

measures of impact. 

.. ~ 
Feaeral Register I Vol.' 59. No. 218 I Monday. November 14. 1994 I Proposed Rules 56431

5. Cash-Flow Analysis ofCosts Due to

Standards .

A change in standards affects the

analvsis in three distinct ways.

Increased levels ofstandards will

require additional investment. will raise

production costs. and will affect

revenue through higher prices and.

possibly. lower quantities sold.

The integrated model using the GRIM

cost analysis uses a number of factorsannual expected revenues; manufacturer

costs such as costs ofsales. selling and

general administration costs; taxes; and

capital expenditures related to

depreciation. new standards. and

maintenance-to arrive at a series of

annual cash flows beginning from before

implementation of standards and

continuing explicitly for five years after

implementation.

The measure of industry net present

values are calculated by discounting the

annual cash flows from the period

before implementation of standards to

some future point in time.

The revenues are supplied by the

price and shipments forecasting

algorithms from the LBL-MIM.

6. Data Sources

The models need data that

charae<terize both a particular industry

and prototypical firms within that

industry. Estimates of data are based on

information from five general sources:

Lawrence Berkeley Laboratory business

consultation groups; the Engineering

Analvsis; the Consumer Analysis;

public financial data; and industry

profiles.

d. Utility Impact Model

Electric utility impact model. The

electric utility analysis serves three

purposes within the overall assess~ent

of the impact of the proposed stanC1ards.

First. it contributes to quantifying the

energy savings by determining the

reduction in fossil fuels used for

electricity generation. Second. the

estimated reduction in fossil fuel

consumption is an input to the

Environmental Assessment. as required

by the National Environmental Policy

Act. And third. by calculating utility

avoided costs. it provides marginal.

electricity costs. Avoided cost is

calculated by assessing the impacts on

the electric utility industry in terms of

changes in investment. revenue

requirements. and residential load

factors.

The electric utility analysis adopts the

standard approach that the value of

electricity savings. based on marginal

costs. can be broken down into energy

savings and capacity savings. The

energy component reflects the avoided

cost of fuel not bumed at the

powerplant by the reduced need to

generate electricity. The capacity

component measures the avoided cost of

financing and building extra generating

capacity. The analysis characterizes

these avoided costs per KWh 'Of heating.

cooling. and baseload energy saved. The

heating and cooling energy includes . baseload and peak energy. These values

are used to calculate societal benefits

from reduced electricity consumption.

The Electric Utility Impact Model

calculates avoided energy costs based

on a disaggregation of the generation

fuel mix to the National Electric

Reliability Council regions and a

simplified load duration curve for each

region. First. the model allocates

national electricity savings that are

forecasted by the LBL-REM to National

Electric Reliability Council regions in

proportion to their current consumption

of heating. cooling. and baseload energy.

The regional proportions are derived

from data on regional appliance

saturations. efficiencies. and hours of

use. The fraction of the electricity that

would have to be generated at the

margin from oil and gas is calculated

from the total regional oil and gas

fraction and the simplified load

duration curve. Projected utility natural

gas and coal prices. weighted by the oil

and gas fraction and the non-oil and gas

fraction. respectively. are used to

calculate utility marginal costs over the

forecast period.The marginal costs are

adjusted to account for seasonal

differences.

The avoided capacity cost calculation

in the model is based on conservation

'load factors for the energy savings

attributable to the standards as well as

the capacity costs of a combustion

turbine. A conservation load factor is

defined as the average hourly energy

savings of a conservation measure

divided by its peak load savings. The

conservation load factors are a way of

characterizing the peak demand savings

of a conservation measure. They are

used to convert the capacity value of the

standards into the per-kWh values

described above. The National Electric

Reliability Council forecasts of capacity

requirements for each region are used to

account for regional variations in

reserve margin. Ifthe National Electric

Reliability Council forecasts an

adequate reserve margin in a region for

a given year. no value is given to the

capacity savings in the region.

The inputs needed for the Utility

Impact Model are conservation load

factors. state-level utility fuel prices.

appliance saturations. efficiencies. and

hours of use as well as electricity

generation by fuel type and capacity

need by National Electric Reliabilitv

Council region. The outputs ofthe .

analysis are fuel savings. reduction in

the need for new generating capacity.

and avoided energy and capacity costs

for heating. cooling. and baseload

appliances per million Btu's of resource

energy.

Gas utility modeling. Because the

natural gas supply system does not

consist of vertically integrated

suppliers. the gas utility modeling

necessarily takes a different approach

from the electric utility modeling.

Nonetheless. the fundamental goal, to

estimate the effect of proposed

standards on utilities and their

customers. is the same. The analysis on

the gas side is greatly simplified by the

fact that no energy conversion is

involved. so that the amount of natural

gas saved at the burner tip is not very

different from the amount that can

remain in the ground. The

environmental impacts are similarly

simple. relative to electricity supply.

because most of the environmental

consequences of residential natural gas

use occur at the burner tip. The focus of

the gas analysis. therefore. sits squarely

on the cost impact of proposed

standards. . The gas utility cost modeling is in two

parts. In the first. the effect of the

standard on the general market for

natural gas is estimated. For the

purposes of this analysis. the result of

interest is the city gate price of natural

gas. That is. the price that local gas

distribution companies pay for the gas

they later distribute to customers. In

general. the sales reductions predicted

from residential appliance efficiency

standards are not expected to be great

enough. or near enough in the future to

have a major impact on the North

American gas market as a whole.

However. to quantify any possible

effect. the Department will use a

national equilibrium gas supply and

transmission model. This model will be

run under a base case that reflects

current EIA forecasts of gas supply and

demand. and policy cases that reflect

Department forecasts of the effect of the

proposed standard.

The second part of the analysis

concerns the gas market downstream of

the city gate. The u.S. has numerous

and diverse local natural gas

distribution companies. and no

individual modeling of companies is

feasible. The Department will. therefore.

rely on a general econometric model of

industry cost structure. Company

operating cost~ are represented in an

historic data base covering about 50

major U.S. distribution companies. A

 EE-RM-94-403 COMMENT 101C

Feaeral Register I Vol.· 59, No. 218 I Monday, November 14, 1994 I Proposed Rules 56431 

5. Cash-Flow Analvsis of Costs Due to 

Standards . 

A change in standards affects the 

analvsis in three distinct ways. 

Increased levels of standards will 

require additional investment, will raise 

production costs, and will affect 

revenue through higher prices and. 

possibly. lower quantities sold. 

The integrated model using the GRIM 

cost analysis uses a number of factorsannual expected revenues; manufacturer 

costs such as costs of sales. selling and 

general administration costs; taxes; and 

capital expenditures related to 

depreciation. new standards. and 

maintenance-to arrive at a series of 

annual cash flows beginning from before 

implementation of standards and 

continuing explicitly for five years after 

implementation. 

The measure of industry net present 

values are calculated by discounting the 

annual cash flows from the period 

before implementation of standards to 

some future point in time. 

The revenues are supplied by the 

price and shipments forecasting 

algorithms from the LBL-MIM. 

6. Data Sources 

The models need data that 

charae<terize both a particular industry 

and prototypical firms within that 

industry. Estimates of data are based on 

information from five general sources: 

Lawrence Berkeley Laboratory business 

consultation groups; the Engineering 

Analvsis; the Consumer Analysis; 

public financial data; and industry 

profiles. 

d. Utility Impact Model 

Electric utility impact model. The 

electric utility analysis serves three 

purposes within the overall assess~ent 

of the impact of the proposed stanctards. 

First, it contributes to quantifying the 

energy savings by determining the 

reduction in fossil fuels used for 

electricity generation. Second. the 

estimated reduction in fossil fuel 

consumption is an input to the 

Environmental Assessment, as required 

bv the National Environmental Policy 

Act. And third, by calculating utility 

avoided costs, it provides marginal. 

electricity costs. Avoided cost is 

calculated by assessing the impacts on 

the electric utility industry in terms of 

changes in investment, revenue 

requirements, and residential load 

factors. 

The electric utility analysis adopts the 

standard approach that the value of 

electricity savings, based on marginal 

costs, can be broken down into energy 

savings and capacity savings. The 

energy component reflects the avoided 

cost of fuel not burned at the 

powerplant by the reduced need to 

generate electricity. The capacity 

component measures the avoided cost of 

financing and building extra generating 

capacity. The analysis characterizes 

these avoided costs per KWh "Of heating. 

cooling. and base load energy saved. The 

heating and cooling energy includes . baseload and peak energy. These values 

are used to calculate societal benefits 

from reduced electricity consumption. 

The Electric Utility Impact Model 

calculates avoided energy costs based 

on a disaggregation of the generation 

fuel mix to the National Electric 

Reliability Council regions and a 

simplified load duration curve for each 

region. First, the model allocates 

national electricity savings that are 

forecasted by the LBL-REM to National 

Electric Reliability Council regions in 

proportion to their current consumption 

of heating. cooling, and base load energy. 

The regional proportions are derived 

from data on regional appliance 

saturations, efficiencies, and hours of 

use. The fraction of the electricity that 

would have to be generated at the 

margin from oil and gas is calculated 

from the total regional oil and gas 

fraction and the Simplified load 

duration curve. Projected utility natural 

gas and coal prices. weighted by the oil 

and gas fraction and the non-oil and gas 

fraction. respectively. are used to 

calculate utility marginal costs over the 

forecast period. The marginal costs are 

adjusted to account for seasonal 

differences. 

The avoided capacity cast calculation 

in the model is based on conservation 

'load factors for the energy savings 

attributable to the standards as well as 

the capacity costs of a combustion 

turbine. A conservation load factor is 

defined as the average hourly energy 

savings of a conservation measure 

divided by its peak load savings. The 

conservation load factors are a way of 

characterizing the peak demand savings 

of a conservation measure. They are 

used to convert the capacity value of the 

standards into the per-kWh values 

described above. The National Electric 

Reliability Council forecasts of capacity 

requirements for each region are used to 

account for regional variations in 

reserve margin. If the National Electric 

Reliability Council forecasts an 

adequate reserve margin in a region for 

a given year. no value is given to the 

capacity savings in the region. 

The inputs needed for the Utility 

Impact Model are conservation load 

factors. state-level utility fuel prices. 

appliance saturations, efficiencies. and 

hours of use as well as electricity 

generation by fuel type and capacity 

need by National Electric Reliabilitv 

Council region. The outputs of the . 

analysis are fuel savings, reduction in 

the need for new generating capacity. 

and avoided energy and capacity costs 

for heating. cooling. and base load 

appliances per million Btu's of resource 

energy. 

Gas utility modeling. Because the 

natural gas supply system does not 

consist of vertically integrated 

suppliers. the gas utility modeling 

necessarily takes a different approach 

from the electric utility modeling. 

Nonetheless. the fundamental goal. to 

estimate the effect of proposed 

standards on utilities and their 

customers, is the same. The analysis on 

the gas side is greatly Simplified by the 

fact that no energy conversion is 

involved, so that the amount of natural 

gas saved at the burner tip is not very 

different from the amount that can 

remain in the ground. The 

environmental impacts are Similarly 

simple. relative to electricity supply, 

because most of the environmental 

consequences of residential natural gas 

use occur at the burner tip. The focus of 

the gas analysis. therefore, sits squarely 

on the cost impact of proposed 

standards. . The gas utility cost modeling is in two 

parts. In the first. the effect of the 

standard on the general market for 

natural gas is estimated. For the 

purposes of this analysis, the result of 

interest is the city gate price of natural 

gas. That is. the price that local gas 

distribution companies pay for the gas 

they later distribute to customers. In 

general. the sales reductions predicted 

from residential appliance efficiency 

standards are not expected to be great 

enough. or near enough in the future to 

have a major impact on the North 

American gas market as a whole. 

However. to quantify any possible 

effect. the Department will use a 

national equilibrium gas supply and 

transmission model. This model will be 

run under a base case that reflects 

current EIA forecasts of gas supply and 

demand. and policy cases that reflect 

Department forecasts of the effect of the 

proposed standard. 

The second part of the analysis 

concerns the gas market downstream of 

the city gate. The U.S. has numerous 

and diverse local natural gas 

distribution companies. and no 

individual modeling of companies is 

feasible. The Department will. therefore. 

rely on a general econometric model of 

industry cost structure. Company 

operating cost~ are represented in an 

historic data base covering about 50 

major U.S. distribution companies. A 

Feaeral Register I Vol.· 59, No. 218 I Monday, November 14, 1994 I Proposed Rules 56431 

5. Cash-Flow Analvsis of Costs Due to 

Standards . 

A change in standards affects the 

analvsis in three distinct ways. 

Increased levels of standards will 

require additional investment, will raise 

production costs, and will affect 

revenue through higher prices and. 

possibly. lower quantities sold. 

The integrated model using the GRIM 

cost analysis uses a number of factorsannual expected revenues; manufacturer 

costs such as costs of sales. selling and 

general administration costs; taxes; and 

capital expenditures related to 

depreciation. new standards. and 

maintenance-to arrive at a series of 

annual cash flows beginning from before 

implementation of standards and 

continuing explicitly for five years after 

implementation. 

The measure of industry net present 

values are calculated by discounting the 

annual cash flows from the period 

before implementation of standards to 

some future point in time. 

The revenues are supplied by the 

price and shipments forecasting 

algorithms from the LBL-MIM. 

6. Data Sources 

The models need data that 

charae<terize both a particular industry 

and prototypical firms within that 

industry. Estimates of data are based on 

information from five general sources: 

Lawrence Berkeley Laboratory business 

consultation groups; the Engineering 

Analvsis; the Consumer Analysis; 

public financial data; and industry 

profiles. 

d. Utility Impact Model 

Electric utility impact model. The 

electric utility analysis serves three 

purposes within the overall assess~ent 

of the impact of the proposed stanctards. 

First, it contributes to quantifying the 

energy savings by determining the 

reduction in fossil fuels used for 

electricity generation. Second. the 

estimated reduction in fossil fuel 

consumption is an input to the 

Environmental Assessment, as required 

bv the National Environmental Policy 

Act. And third, by calculating utility 

avoided costs, it provides marginal. 

electricity costs. Avoided cost is 

calculated by assessing the impacts on 

the electric utility industry in terms of 

changes in investment, revenue 

requirements, and residential load 

factors. 

The electric utility analysis adopts the 

standard approach that the value of 

electricity savings, based on marginal 

costs, can be broken down into energy 

savings and capacity savings. The 

energy component reflects the avoided 

cost of fuel not burned at the 

powerplant by the reduced need to 

generate electricity. The capacity 

component measures the avoided cost of 

financing and building extra generating 

capacity. The analysis characterizes 

these avoided costs per KWh "Of heating. 

cooling. and base load energy saved. The 

heating and cooling energy includes . baseload and peak energy. These values 

are used to calculate societal benefits 

from reduced electricity consumption. 

The Electric Utility Impact Model 

calculates avoided energy costs based 

on a disaggregation of the generation 

fuel mix to the National Electric 

Reliability Council regions and a 

simplified load duration curve for each 

region. First, the model allocates 

national electricity savings that are 

forecasted by the LBL-REM to National 

Electric Reliability Council regions in 

proportion to their current consumption 

of heating. cooling, and base load energy. 

The regional proportions are derived 

from data on regional appliance 

saturations, efficiencies, and hours of 

use. The fraction of the electricity that 

would have to be generated at the 

margin from oil and gas is calculated 

from the total regional oil and gas 

fraction and the Simplified load 

duration curve. Projected utility natural 

gas and coal prices. weighted by the oil 

and gas fraction and the non-oil and gas 

fraction. respectively. are used to 

calculate utility marginal costs over the 

forecast period. The marginal costs are 

adjusted to account for seasonal 

differences. 

The avoided capacity cast calculation 

in the model is based on conservation 

'load factors for the energy savings 

attributable to the standards as well as 

the capacity costs of a combustion 

turbine. A conservation load factor is 

defined as the average hourly energy 

savings of a conservation measure 

divided by its peak load savings. The 

conservation load factors are a way of 

characterizing the peak demand savings 

of a conservation measure. They are 

used to convert the capacity value of the 

standards into the per-kWh values 

described above. The National Electric 

Reliability Council forecasts of capacity 

requirements for each region are used to 

account for regional variations in 

reserve margin. If the National Electric 

Reliability Council forecasts an 

adequate reserve margin in a region for 

a given year. no value is given to the 

capacity savings in the region. 

The inputs needed for the Utility 

Impact Model are conservation load 

factors. state-level utility fuel prices. 

appliance saturations, efficiencies. and 

hours of use as well as electricity 

generation by fuel type and capacity 

need by National Electric Reliabilitv 

Council region. The outputs of the . 

analysis are fuel savings, reduction in 

the need for new generating capacity. 

and avoided energy and capacity costs 

for heating. cooling. and base load 

appliances per million Btu's of resource 

energy. 

Gas utility modeling. Because the 

natural gas supply system does not 

consist of vertically integrated 

suppliers. the gas utility modeling 

necessarily takes a different approach 

from the electric utility modeling. 

Nonetheless. the fundamental goal. to 

estimate the effect of proposed 

standards on utilities and their 

customers, is the same. The analysis on 

the gas side is greatly Simplified by the 

fact that no energy conversion is 

involved, so that the amount of natural 

gas saved at the burner tip is not very 

different from the amount that can 

remain in the ground. The 

environmental impacts are Similarly 

simple. relative to electricity supply, 

because most of the environmental 

consequences of residential natural gas 

use occur at the burner tip. The focus of 

the gas analysis. therefore, sits squarely 

on the cost impact of proposed 

standards. . The gas utility cost modeling is in two 

parts. In the first. the effect of the 

standard on the general market for 

natural gas is estimated. For the 

purposes of this analysis, the result of 

interest is the city gate price of natural 

gas. That is. the price that local gas 

distribution companies pay for the gas 

they later distribute to customers. In 

general. the sales reductions predicted 

from residential appliance efficiency 

standards are not expected to be great 

enough. or near enough in the future to 

have a major impact on the North 

American gas market as a whole. 

However. to quantify any possible 

effect. the Department will use a 

national equilibrium gas supply and 

transmission model. This model will be 

run under a base case that reflects 

current EIA forecasts of gas supply and 

demand. and policy cases that reflect 

Department forecasts of the effect of the 

proposed standard. 

The second part of the analysis 

concerns the gas market downstream of 

the city gate. The U.S. has numerous 

and diverse local natural gas 

distribution companies. and no 

individual modeling of companies is 

feasible. The Department will. therefore. 

rely on a general econometric model of 

industry cost structure. Company 

operating cost~ are represented in an 

historic data base covering about 50 

major U.S. distribution companies. A 
56432 Federal Register I Vof. 59. No. 218 I Monday. November 1.4. 1994 I Proposed Ru~es

translog econometric cost function will

be fitted to these data and then applied

as a forecasting tooL The inputs to this

model are twofold; (1) the same base

r.ase-and policy case demand forecasts.

reduced to local company levels: and (2)

the base and policy case city gate price

forecasts derived from the market-wide

analysis. The results ofthe econometric

modeling willshow the effects of the

proposed standard on a typical local

distribution company and its customers.

e. Sensitivity Anal}'S8s

Sensitivity studies are perfonned to

determine how changes in technical and

operational parameters affect key

engineering and economic indicators

used in evaluation ofappliance

standards.This makes it possible to

place limits on the overall results of the

analysis and to gain an understanding of

which variables are most important in

producing these results. Sensitivity

analyses are developed in a series of

distinct steps. For each component

analysis in the overall analysis. critical

input parameters are identified and

reasonable ranges of variation

determined. The sensitivity of the

model to changes in the value of each

important parameter is then estimated

by running the model for both the base

case and the standards cases. The

results of the sensitivity analyses are

examined to determine the sensitivity of

the forecasts to exogenous variables and

assumptions and the sensitivity of the

differences between the base and

standards cases (impacts of alternative

standards).

The sensitivity analyses have been

developed at the national level and no

effort has been made to link them with

any specific population groups. The

standards analvsis assumes that

nationv.'ide average appliance usage

rates. energy prices. and efficiency

apply to all consumers in all areas of the

nation. although the Department

recognizes that there exist large

~'ariations in each ofthese factors. The

Department requested in the Three

Product Advance Notice infonnation

concerning the extent to which any

proposed national efficiency standard is

likely to affect identifiable groups of

consumerS disproportionaily and how

best to consider such impacts in the

selection of efficiencv standard levels.

The Department also"requested

additional data to help it better assess

the disproportionate impacts on such

groups. The Department expects to use

the same approach that emerges in the

Three Product Advance Notice

rulemaking in this rolemaking. The

Dt:lpartment welcomes comments on this

\ssue.

IV. Public ColllIOOnt Procedures

a. Participation in Rulemaking

The Department encourages the

maximum level of public participation

possible in this rolemaking. Individual

consumers. representatives of consumer

groups. manufacturers. associations.

States or other governmental entities.

utilities. retailers. distributoxs.

manufacturers. and others are urged to

submit written statements on the

proposal.

the Department has established a

period of 75 days following publication

ofthis notice for persons to comment on

this proposal. All public comments

received will be available for review in

the Department's Freedom of

Information Reading Room.

b. Written Comment Procedures

Interested persons are invited to

participate in this proceeding by

submitting written data. views, or

arguments with respect to the subjects

set forth in this notice. Instructions for

submitting written comments are set

forth at the beginning ofthis notice and

below.

Comments should be labeled both on

the envelope and on the documents.

"Three Cleaning Products Rulemaking

(Docket No. EE-RM-94-403)." and must

be received by the date specified at the

beginning of this notice. Ten copies are

requested to be submitted. Additionally.

the Department would appreciate an

electronic copy ofthe comments to the

extent possible. The Department is

currently using WordPerfectTM 5.1. All

comments and other relevant

information received by the date

specified at the beginning of this notice

will be considered by the Department in

the proposed role.

All written comments received on the

Advance Notice of Proposed

Ruiemaking will be available for public

inspection at the Freedom of

Information Reading Room. as provided

at the beginning of this notice.

Pursuant to the provisions of 10 CFR

1004.11. any person submitting

infonnation or data that is believed to be

confidential and exempt by law from

public disclosure should submit one

complete copy of the document and ten

(1.0) copies. if possible. from which the

information believed to be confidential

has been deleted. The Department will

make its own determination with regard

to the confidential status of the

information or data and treat it

according to its determination.

Factors of interest to the Department.

when evaluating requests to treat

information as confidential. include: (1)

A description of the item: (2) an

indication asto whether and why such

items of infonnation have been treated

by the submiUing party as confidential.

and whether and why such items are

customarily treated as confidential. and

whether and why such items are

customarily treated as confidential

\\dthin the industry; (3) whether the

information is generally known or

available from other sources~ (4)

whether the information has previously

been available to others without

obligation concerning its

confidentiality: (5) an explanation of the

competitive injury to the submitting

person that would result from public

disclosure:{6) an indication as to when

such infonnation might lose its

confidential character due to the

passage oftime: and (7) whether

disclosure ofthe information would be

in the public interest.

c.lssues for Public Comment

The Department is interested in

receiving comments and data

concerning the accuracy and

workability of this methodology. Also.

the Department welcomes discussion on improvements or alternatives to this

approach. In particular. the Department

is interested in gathering data on the

follOWing:

• Descriptive and performance

characteristics for baseline models of

each product class that are the subject

of this rnlemaking; these baseline

models should be those satisfying the

appropriate standards;

• Proposed productclasses for

products in this rolemaking~

• Costs of baseline models and

incremental costs of designs improving

the energy efficiency of the products

that are the subject of this rnlemaking: • Appropriateness of existing and

proposed. test procedures to the

proposed design options: specifically.

the Department would like comments

on whether a clothes washer that

consumes more energy for a higher

percentage of water extraction (thus.

lower clothes dryer energy

consumption) should be given a credit

and ifso. how much; and • Data on lifetimes of the appliances.

The Department requested

information on the issues listed below

in the Three Product Advance Notice

.issued in September 1993. However. the

Department encourages commenters to

provide any additional infonnation on

these issues which may not have been

presented in response to the

Department's Three Product Advance

Notice. These issues are as follows:

• The relevance of the data inputs

and outputs of the LBL-REM and LBLMIM models. whether these models

 EE-RM-94-403 COMMENT 101C

56432 Federal Register I Vof. 59. No. 218 t Monday. November 1.4. 1994 I Proposed Ru~es 

translog econometric cost function will 

be fitted to these data and then applied 

as a forecasting tooL The inputs to this 

model are twofold; (1) the same base 

r.ase-and policy case demand forecasts. 

reduced to local company levels: and (2) 

the base and policy case city gate price 

forecasts derived from the market-wide 

analysis. The results of the econometric 

modeling will show the effects of the 

proposed standard on a typical local 

distribution company and its customers.. 

e. Sensitivity Anal}"S8s 

Sensitivity studies are perfonned to 

determine how changes in technical and 

operational parameters affect key 

engineering and economicinrucators 

used in evaluation of appliance 

standards. This makes it possible to 

place limits on the overall results of the 

analysis and to gain an understanding of 

which variables are most important in 

producing these results. Sensitivity 

analyses are developed in a series of 

distinct steps. For each component 

analysis in the overall analysis. critical 

input parameters are identified and 

reasonable ranges of variation 

determined. The sensitivity of the 

model to changes in the value of each 

-important parameter is then estimated 

by running the model for both the base 

case and the standards cases. The 

results of the sensitivity analyses are 

examined to determine the sensitivity of 

the forecasts to exogenous variables and 

assumptions and the sensitivity of the 

differences between the base and 

standards cases (impacts of alternative 

standards). 

The sensitivity analyses have been 

developed at the national level and no 

effort has been made to link them with 

any specific population groups. The 

standards analvsis assumes that 

nationwide average appliance usage 

rates. energy prices. and efficiency 

apply to all consumers in all areas of the 

nation. although the Department 

recognizes that there exist large 

~'ariations in each of these factors. The 

Department requested in the Three 

Product Advance Notice information 

concerning the extent to which any 

proposed national efficiency standard is 

likely to affect identifiable groups of 

consumerS disproportionaUy and how 

best to consider such impacts in the 

selection of efficiencv standard levels. 

The Department also'requested 

additional data to belp it better assess 

the disproportionate impacts on such 

groups. The Department expects to use 

the same approach that emerges in the 

Three Product Advance Notice 

rulemaking in this rulemaking. The 

Dt:lpartment welcomes comments on this 

\ssue. 

IV. Public ColllIOOnt Procedures 

a. Participation in Rulemaking 

The Department encourages the 

maximum level of public participation 

possible in this rulemaking. Individual 

consumers. representatives of consumer 

groups. manufacturers. associations. 

States or other governmental entities. 

utilities. retailers. rustributoxs. 

manufacturers. and others are urged to 

submit written statements on the 

P~partment has established a 

period of 75 days following publication 

of this notice for persons to comment on 

this proposal. All public comments 

received will be available for review in 

the Department's Freedom of 

Information Reading Room. 

b. Written Comment Procedures 

Interested persons are invited to 

participate in this proceeding by 

submitting written data. views. or 

arguments with respect to the subjects 

set forth in this notice. Instructions for 

submitting written comments are set 

forth at the beginning of this notice and 

below. 

Comments should be labeled both on 

the envelope and on the documents. 

"Three Cleaning Products Rulemaking 

(Docket No. EE-RM-94-403)," and must 

be received by the date specified at the 

beginning of this notice. Ten copies are 

requested to be submitted. Additionally. 

the Department would appreciate an 

electronic copy of the comments to the 

extent possible. The Department is 

currently using WordPerfectTM 5.1. All 

comments and other relevant 

information received by the date 

specified at the beginning of this notice 

will be considered by the Department in 

the proposed rule. 

All written comments received on the 

Advance Notice of Proposed 

Ruiemaking will be available for public 

inspection at the Freedom of 

Information Reading Room. as provided 

at the beginning of this notice. 

Pursuant to the provisions of 10 CFR 

1004.11. any person submitting 

infonnation or data that is believed to be 

confidential and exempt by law from 

public disclosure should submit one 

complete copy of the document and ten 

(1.0) copies. if possible. from which the 

information believed to be confidential 

has been deleted. The Department will 

make its own determination with regard 

to the confidential status of the 

information or data end treat it 

according to its determination. 

Factors of interest to the Department. 

when evaluating requests to treat 

information as confidential. include: (1) 

A description of the item: (2) an 

indication as to whether and why such 

items of infonnation have been treated 

by the submitting party as confidential. 

and whether and why such items are 

customarily treated as confidential. and 

whether and why such items are 

customarily treated as confidential 

\\dthin the industry; (3) whether the 

information is generally known or 

available from other sources~ (4) 

whether the information has previously 

been available to others without 

obligation concerning its 

confidentiality; (5) an expianation of the 

competitive injury to the submitting 

person that would resuit from public 

rusclosure;{6) an indication as to when 

such infonnation might lose its 

confidential character due to the 

passage of time; and (7) whether 

disclosure of the infonnation would be 

in the public interest. 

c.lssues for Public Comment 

The Department is interested in 

receiving comments and data 

concerning the accuracy and 

workability of this methodology. Also. 

the Department welcomes discussion on improvements or alternatives to this 

approach. In particular. the Department 

is interested in gathering data on the 

follOWing: 

• Descriptive and perfonnance 

characteristics for baseline models of 

each product class that are the subject 

of this rulemaking: these baseline 

models should be tbose satisfying the 

appropriate standards: 

• Proposed product classes for 

products in this rulemaking; • Costs of baseline models and 

incremental costs of designs improving 

the energy efficiency of the products 

tbat are the subject of this rulemaking: • Appropriateness of existing and 

proposed test procedures to the 

proposed design options: specifically. 

the Department would like comments 

on whether a clothes washer that 

consumes more energy for a higher 

percentage of water extraction (thus. 

lower clothes dryer energy 

consumption) should be given a credit 

and if so. how much: and • Data on lifetimes of the appliances. 

The Department requested 

information on the issues listed below 

in the Three Product Advance Notice 

.issued in September 1993. However. the 

Department encourages commenters to 

provide any additional infonnation on 

these issues wbich may not have been 

presented in response to the 

Department's Three Product Advance 

Notice. These issues are as follows: 

• The relevance of the data inputs 

and outputs of the LBL-REM and LBLMIM models. whether these models 

56432 Federal Register I Vof. 59. No. 218 t Monday. November 1.4. 1994 I Proposed Ru~es 

translog econometric cost function will 

be fitted to these data and then applied 

as a forecasting tooL The inputs to this 

model are twofold; (1) the same base 

r.ase-and policy case demand forecasts. 

reduced to local company levels: and (2) 

the base and policy case city gate price 

forecasts derived from the market-wide 

analysis. The results of the econometric 

modeling will show the effects of the 

proposed standard on a typical local 

distribution company and its customers.. 

e. Sensitivity Anal}"S8s 

Sensitivity studies are perfonned to 

determine how changes in technical and 

operational parameters affect key 

engineering and economicinrucators 

used in evaluation of appliance 

standards. This makes it possible to 

place limits on the overall results of the 

analysis and to gain an understanding of 

which variables are most important in 

producing these results. Sensitivity 

analyses are developed in a series of 

distinct steps. For each component 

analysis in the overall analysis. critical 

input parameters are identified and 

reasonable ranges of variation 

determined. The sensitivity of the 

model to changes in the value of each 

-important parameter is then estimated 

by running the model for both the base 

case and the standards cases. The 

results of the sensitivity analyses are 

examined to determine the sensitivity of 

the forecasts to exogenous variables and 

assumptions and the sensitivity of the 

differences between the base and 

standards cases (impacts of alternative 

standards). 

The sensitivity analyses have been 

developed at the national level and no 

effort has been made to link them with 

any specific population groups. The 

standards analvsis assumes that 

nationwide average appliance usage 

rates. energy prices. and efficiency 

apply to all consumers in all areas of the 

nation. although the Department 

recognizes that there exist large 

~'ariations in each of these factors. The 

Department requested in the Three 

Product Advance Notice information 

concerning the extent to which any 

proposed national efficiency standard is 

likely to affect identifiable groups of 

consumerS disproportionaUy and how 

best to consider such impacts in the 

selection of efficiencv standard levels. 

The Department also'requested 

additional data to belp it better assess 

the disproportionate impacts on such 

groups. The Department expects to use 

the same approach that emerges in the 

Three Product Advance Notice 

rulemaking in this rulemaking. The 

Dt:lpartment welcomes comments on this 

\ssue. 

IV. Public ColllIOOnt Procedures 

a. Participation in Rulemaking 

The Department encourages the 

maximum level of public participation 

possible in this rulemaking. Individual 

consumers. representatives of consumer 

groups. manufacturers. associations. 

States or other governmental entities. 

utilities. retailers. rustributoxs. 

manufacturers. and others are urged to 

submit written statements on the 

P~partment has established a 

period of 75 days following publication 

of this notice for persons to comment on 

this proposal. All public comments 

received will be available for review in 

the Department's Freedom of 

Information Reading Room. 

b. Written Comment Procedures 

Interested persons are invited to 

participate in this proceeding by 

submitting written data. views. or 

arguments with respect to the subjects 

set forth in this notice. Instructions for 

submitting written comments are set 

forth at the beginning of this notice and 

below. 

Comments should be labeled both on 

the envelope and on the documents. 

"Three Cleaning Products Rulemaking 

(Docket No. EE-RM-94-403)," and must 

be received by the date specified at the 

beginning of this notice. Ten copies are 

requested to be submitted. Additionally. 

the Department would appreciate an 

electronic copy of the comments to the 

extent possible. The Department is 

currently using WordPerfectTM 5.1. All 

comments and other relevant 

information received by the date 

specified at the beginning of this notice 

will be considered by the Department in 

the proposed rule. 

All written comments received on the 

Advance Notice of Proposed 

Ruiemaking will be available for public 

inspection at the Freedom of 

Information Reading Room. as provided 

at the beginning of this notice. 

Pursuant to the provisions of 10 CFR 

1004.11. any person submitting 

infonnation or data that is believed to be 

confidential and exempt by law from 

public disclosure should submit one 

complete copy of the document and ten 

(1.0) copies. if possible. from which the 

information believed to be confidential 

has been deleted. The Department will 

make its own determination with regard 

to the confidential status of the 

information or data end treat it 

according to its determination. 

Factors of interest to the Department. 

when evaluating requests to treat 

information as confidential. include: (1) 

A description of the item: (2) an 

indication as to whether and why such 

items of infonnation have been treated 

by the submitting party as confidential. 

and whether and why such items are 

customarily treated as confidential. and 

whether and why such items are 

customarily treated as confidential 

\\dthin the industry; (3) whether the 

information is generally known or 

available from other sources~ (4) 

whether the information has previously 

been available to others without 

obligation concerning its 

confidentiality; (5) an expianation of the 

competitive injury to the submitting 

person that would resuit from public 

rusclosure;{6) an indication as to when 

such infonnation might lose its 

confidential character due to the 

passage of time; and (7) whether 

disclosure of the infonnation would be 

in the public interest. 

c.lssues for Public Comment 

The Department is interested in 

receiving comments and data 

concerning the accuracy and 

workability of this methodology. Also. 

the Department welcomes discussion on improvements or alternatives to this 

approach. In particular. the Department 

is interested in gathering data on the 

follOWing: 

• Descriptive and perfonnance 

characteristics for baseline models of 

each product class that are the subject 

of this rulemaking: these baseline 

models should be tbose satisfying the 

appropriate standards: 

• Proposed product classes for 

products in this rulemaking; • Costs of baseline models and 

incremental costs of designs improving 

the energy efficiency of the products 

tbat are the subject of this rulemaking: • Appropriateness of existing and 

proposed test procedures to the 

proposed design options: specifically. 

the Department would like comments 

on whether a clothes washer that 

consumes more energy for a higher 

percentage of water extraction (thus. 

lower clothes dryer energy 

consumption) should be given a credit 

and if so. how much: and • Data on lifetimes of the appliances. 

The Department requested 

information on the issues listed below 

in the Three Product Advance Notice 

.issued in September 1993. However. the 

Department encourages commenters to 

provide any additional infonnation on 

these issues wbich may not have been 

presented in response to the 

Department's Three Product Advance 

Notice. These issues are as follows: 

• The relevance of the data inputs 

and outputs of the LBL-REM and LBLMIM models. whether these models 
Federal Register I Vol. 59, No. 218 I Monday, November 14. 1994 / Proposed Rules 56433

could or should capture the cumulative

effects ofFederal energy conservation

standards on multi-product appliance

manufacturers and whether or not there

are acceptable alternative models that

could be used, such as REEFS or GRIM; • Analytic bases and methods of

calculating the dollar value ofreduced

atmospheric emissions of S02, N02, and

C02 from reduced energy consumption: • Data on consumer financing of

appliances useful for obtaining a

weighted-average discount rate; and • Data on the possible adverse affects

ofstandards on identifiable groups of

consumers that experience belowaverage utility or usage rates.

The Department has been unable to

identify the financial characteristics of

small manufacturers. For purposes of

this analysis, small manufacturers' costs

are assumed to equal those of medium

manufacturers. The Department is

especially interested in learning of the

existence of small manufacturers and in

obtaining costing data from such

manufacturers of the products under

consideration.

For the Residential Energy Model

analysis, the Department requests

interested parties to provide historical

data on shipments and average

efficiencies by class for the products

subject to the proposed rulemaking.

Data on consumer prices and on the

installation and maintenance expenses

of these appliances are also requested.

The manufacturer analysis needs

financial data from the product division

level. All of these data are available at

the firm level; but since firms are

typically much larger than the relevant

division. the firm data may give a

misleading indication of the division's

finances.

An income statement and balance

sheet at the division level would be

most helpful. If this is not available,

then data on the following variables are

considered most essential: Net income,

revenue. selling and general and

administrative costs, engineering costs.

costs of goods sold, interest. taxes, debtto-equity raao, net depreciable assets,

net assets, capital investment. and longterm debt.

The Department also welcomes

current data on unit sales and revenues

for the industries as a whole.

V. Review Under Executive Order

12866

Today's regulatory action has been

determined to be an "economically

significant regulatory action" under

Executive Order 12866, "Regulatory

Planning and Review," (58 FR 51735,

October 4.1993). Accordingly. today's

action was subject to review under the

Executive Order by the Office of

Information and Regulatory Affairs

(OIRA).

There were no substantive changes

oetween the draft submitted to OIRA

and today's action. •The draft of today's action and any

other documents submitted to OIRA for

review have been made a part of the

rulemaking record and are available for

public review in the Department's

Freedom of Information Reading Room.

1000 Independence Avenue SW.

Washington. DC 20585 between the

hours of 9:00 and 4:00. Monday through

Friday. telephone (202) 586-6020.

Issued in Washington, DC. on November 2.

1994.

Christine A. Ervin,

Assistant Secretary. Energy Efficiency and

Renewable Energy.

[FR Doc. 94-28044 Filed 11-10-94: 8:45 ami

61LUNG CODE 6450-01-P

DEPARTMENT OF TRANSPORTATION

Federal Aviation Administration

14 CFR Part 39

[Docket No. 944.1M-141-AD]

Airworthiness Directives; Airbus Model

A320 Series Airplanes

AGENCY: Federal Aviation

Administration, DOT.

ACTION: Notice of proposed rulemaking

(NPRM).

SUMMARY: This document proposes the

adoption of a new airworthiness

directi'.:e (AD) that is applicable to

certain Airbus Model A320 series

airplanes. This proposal would require

replacement of the check valves of the

thrust reverser with modified valves on

certain airplane configurations and the

replacement of the manual control

valves ofthe thrust reverser with

modified valves on certain other

airplane configurations. This proposal is

prompted by recent engineering

analysis. which revealed that if the nonreturn valve installed on the hydraulic

return line of the thrust reverser were to

jam in the closed position, it could

cause pressurization of the Hydraulic

Control Unit (HCU). The actions

specified by the proposed AD are

intended to prevent possible

pressurization ofthe HCU, due to

jamming of the non-return valve in the

hydraulic return line. and consequent

deployment of a thrust reverser during

flight. which could affect the

controllability of the-airplane.

OATES: Comments must be received by

December 27,1994.

ADDRESSES: Submit comments in

triplicate to the Federal Aviation

Administration (FAA), Transport

Airplane Directorate, ANM-103,

Attention: Rules Docket No. 94-NM141-AD, 1601 Lind Avenue. SW.,

Renton, Washington 98055-4056.

Comments may be inspected at this

location between 9:00 a.m. and 3:00

p.m., Monday through Friday, except

Federal holidays.

The service information referenced in

the proposed rule may be obtained from

Airbus Industrie, 1 Rond Point Maurice

Bellonte.31707 Blagnac Cedex, France.

This information mav be examined at

the FAA. Transport Airplane

Directorate. 1601 Lind Avenue, S\V..

Renton. Washington.

FOR FURTHER INFORMATION CONTACT:

Stephen Slotte, Aerospace Engineer.

Standardization Branch. ANM-113.

FAA. Transport Airplane Directorate,

1601 Lind Avenue, SW., Renton.

Washington 98055-4056; telephone

(206) 227-2797; fax (206) 227-1320.

SUPPLEMENTARY INFORMATION:

Comments Invited

Interested persons are invited to

participate in the making ofthe

proposed rule by submitting such

written data. views. or arguments as

they may desire. Communications shall

identify the Rules Docket number and

be submitted in triplicate to the address

specified above. All communications

received on or before the closing date

for comments. specified above, will be

considered before taking action on the

proposed rule. The proposals contained

in this notice may be changed in light

ofthe comments receh'ed.

Comments are specifically invited on

the overall regulatory. economic,

environmental. and energy aspects of

the proposed rule. All comments

submitted will be available. both before

and after the closing date for comments.

in the Rules Docket for examination bv

interested persons. A report .

summarizing each FAA-public contact

concerned with the substance of this

proposal will be filed in the Rules

Docket.

Commenters wishing the FAA to

acknowledge receipt of their comments

submitted in response to this notice

must submit a self-addressed, stamped

postcard on which the follOWing -

statement is made; "Comments to

Do<::ket Number 94-NM-141-AD." The

postcard will be date stamped and

returned to the commenter.

Availability ofNPRMs

Any person may obtain a copy or \'-·is

NPRM by submitting a request to tIlt'

 EE-RM-94-403 COMMENT 101C

. Federal Register I Vol. 59, No. 218 I Monday, November 14. 1994 / Proposed Rules 56433 

could or should capture the cumulative 

effects of Federal energy conservation 

standards on multi-product appliance 

manufacturers and whether or not there 

are acceptable alternative models that 

could be used, such as REEFS or GRIM; 

• Analytic bases and methods of 

calculating the dollar value of reduced 

atmospheric emissions of S02, N02, and 

C02 from reduced energy consumption; • Data on consumer financing of 

appliances useful for obtaining a 

weighted-average discount rate; and • Data on the possible adverse affects 

of standards on identifiable groups of 

consumers that experience belowaverage utility or usage rates. 

The Department has been unable to 

identify the financial characteristics of 

small manufacturers. For purposes of 

this analysis, small manufacturers' costs 

are assumed to equal those of medium 

manufacturers. The Department is 

especially interested in learning of the 

existence of small manufacturers and in 

obtaining costing data from such 

manufacturers of the products under 

consideration. 

For the Residential Energy Model 

analysis, the Department requests 

interested parties to provide historical 

data on shipments and average 

efficiencies by class for the products 

subject to the proposed rulemaking. 

Data on consumer prices and on the 

installation and maintenance expenses 

of these appliances are also requested. 

The manufacturer analysis needs 

financial data from the product division 

level. All of these data are available at 

the firm level; but since firms are typically much larger than the relevant 

division, the firm data may give a 

misleading indication of the division's 

finances. 

A.n income statement and balance 

sheet at the division level would be 

most helpful. If this is not available. 

then data on the following variables are 

considered most essential: Net income. 

revenue. selling and general and 

administrative costs, engineering costs. 

costs of goods sold, interest, taxes. debtto-equity raao. net depreciable assets, 

net assets, capital investment, and longterm debt. 

The Department also welcomes 

current data on unit sales and revenues 

for the industries as a whole. 

V. Review Under Executive Order 

12866 

Today's regulatory action has been 

determined to be an "economically 

significant regulatory action" under 

Executive Order 12866. "Regulatory 

Planning and Review," (58 FR 51735, 

October 4,1993). Accordingly, today's 

action was subject to review under the 

Executive Order by the Office of 

Information and Regulatory Affairs 

(OIRA). 

There were no substantive changes 

oetween the draft submitted to OIRA 

and today's action. • The draft of today's action and any 

other documents submitted to OIRA for 

review have been made a part of the 

rulemaking record and are available for 

public review in the Department's 

Freedom of Information Reading Room, 

1000 Independence Avenue SW. 

Washington. DC 20585 between the 

hours of 9:00 and 4:00, Monday through 

Friday, telephone (202) 586-6020. 

Issued in Washington. DC, on November 2. 

1994. 

Christine A. Ervin, 

Assistant Secretary. Energy Efficiency and 

Renewable Energy. 

[FR Doc. 94-28044 Filed 11-10-94: 8:45 ami 

61LUNG CODE 6450-01-P 

OEPARTMENT OF TRANSPORTATION 

Federal Aviation Administration 

14 CFR Part 39 

[Docket No. 9~M-141-AD] 

Airworthiness Oirectives; Airbus Model 

A320 Series Airplanes 

AGENCY: Federal Aviation 

Administration, DOT. 

ACTION: Notice of proposed rulemaking 

(NPRM). 

SUMMARY: This document proposes the 

adoption of a new airworthiness 

directj'l,:e (AD) that is applicable to 

certain Airbus Model A320 series 

airplanes. This proposal would require 

replacement of the check valves of the 

thrust reverser with modified valves on 

certain airplane configurations and the 

replacement of the manual control 

valves of the thrust reverser with 

modified valves on certain other 

airplane configurations. This proposal is 

prompted by recent engineering 

analysiS. which revealed that if the nonretum valve installed on the hydraulic 

return line of the thrust reverser were to 

jam in the closed position. it could 

cause pressurization of the Hydraulic 

Control Unit (HCU). The actions 

specified by the proposed AD are 

intended to prevent possible 

pressurization of the HCU, due to 

jamming of the non-return valve in the 

hydraulic return line, and consequent 

deployment of a thrust reverser during 

flight. which could affect the 

controllability of the' airplane. 

OATES: Comments must be received by 

December 27,1994. 

ADDRESSES: Submit comments in 

triplicate to the Federal Aviation 

Administration (FAA). Transport 

Airplane Directorate, ANM-103. 

Attention: Rules Docket No. 94-NM141-AD, 1601 Lind Avenue, SW., 

Renton, Washington 98055-4056. 

Comments may be inspected at this 

location between 9:00 a.m. and 3:00 

p.m., Monday through Friday, except 

Federal holidays. 

The service information referenced in 

the proposed rule may be obtained from 

Airbus Industrie. 1 Rond Point Maurice 

Bellonte, 31707 Blagnac Cedex, France. 

This information mav be examined at 

the FAA. Transport Airplane 

Directorate, 1601 Lind Avenue, SW .. 

Renton, Washington. 

FOR FURTHER INFORMATION CONTACT: 

Stephen Siotte. Aerospace Engineer. 

Standardization Branch. ANM-113, 

FAA. Transport Airplane Directorate. 

1601 Lind Avenue, SW., Renton. 

Washington 98055-4056; telephone 

(206) 227-2797; fax (206) 227-1320. 

SUPPLEMENTARY INFORMATION: 

Comments Invited 

Interested persons are invited to 

participate in the making ofthe 

proposed rule by submitting such 

written data, views, or arguments as 

they may desire. Communications shall 

identify the Rules Docket number and 

be submitted in triplicate to the address 

specified above. All communications 

received on or before the closing date 

for comments. specified above, will be 

considered before taking action on the 

proposed rule. The proposals contained 

in this notice may be changed in light 

ofthe comments recei\'ed. 

Comments are specifically invited on 

the overall regulatory. economic. 

environmental. and energy aspects of 

the proposed rule. All comments 

submitted will be available, both before 

and after the closing date for comments. 

in the Rules Docket for examination bv 

interested persons. A report . 

summarizing each FAA-public contact 

concerned with the substance of this 

proposal will be filed in the Rules 

Docket. 

Commenters wishing the FAA to 

acknowledge receipt of their comments 

submitted in response to this notice 

must submit a self-addressed, stamped 

postcard on which the follOWing . 

statement is made: "Comments to 

Dm::ket Number 94-NM-141-AD." The 

postcard will be date stamped and 

returned to the commenter. 

Availability ofNPRMs 

Any person may obtain a copy or \ '··is 

NPRM by submitting a request to tIlt-

. Federal Register I Vol. 59, No. 218 I Monday, November 14. 1994 / Proposed Rules 56433 

could or should capture the cumulative 

effects of Federal energy conservation 

standards on multi-product appliance 

manufacturers and whether or not there 

are acceptable alternative models that 

could be used, such as REEFS or GRIM; 

• Analytic bases and methods of 

calculating the dollar value of reduced 

atmospheric emissions of S02, N02, and 

C02 from reduced energy consumption; • Data on consumer financing of 

appliances useful for obtaining a 

weighted-average discount rate; and • Data on the possible adverse affects 

of standards on identifiable groups of 

consumers that experience belowaverage utility or usage rates. 

The Department has been unable to 

identify the financial characteristics of 

small manufacturers. For purposes of 

this analysis, small manufacturers' costs 

are assumed to equal those of medium 

manufacturers. The Department is 

especially interested in learning of the 

existence of small manufacturers and in 

obtaining costing data from such 

manufacturers of the products under 

consideration. 

For the Residential Energy Model 

analysis, the Department requests 

interested parties to provide historical 

data on shipments and average 

efficiencies by class for the products 

subject to the proposed rulemaking. 

Data on consumer prices and on the 

installation and maintenance expenses 

of these appliances are also requested. 

The manufacturer analysis needs 

financial data from the product division 

level. All of these data are available at 

the firm level; but since firms are typically much larger than the relevant 

division, the firm data may give a 

misleading indication of the division's 

finances. 

A.n income statement and balance 

sheet at the division level would be 

most helpful. If this is not available. 

then data on the following variables are 

considered most essential: Net income. 

revenue. selling and general and 

administrative costs, engineering costs. 

costs of goods sold, interest, taxes. debtto-equity raao. net depreciable assets, 

net assets, capital investment, and longterm debt. 

The Department also welcomes 

current data on unit sales and revenues 

for the industries as a whole. 

V. Review Under Executive Order 

12866 

Today's regulatory action has been 

determined to be an "economically 

significant regulatory action" under 

Executive Order 12866. "Regulatory 

Planning and Review," (58 FR 51735, 

October 4,1993). Accordingly, today's 

action was subject to review under the 

Executive Order by the Office of 

Information and Regulatory Affairs 

(OIRA). 

There were no substantive changes 

oetween the draft submitted to OIRA 

and today's action. • The draft of today's action and any 

other documents submitted to OIRA for 

review have been made a part of the 

rulemaking record and are available for 

public review in the Department's 

Freedom of Information Reading Room, 

1000 Independence Avenue SW. 

Washington. DC 20585 between the 

hours of 9:00 and 4:00, Monday through 

Friday, telephone (202) 586-6020. 

Issued in Washington. DC, on November 2. 

1994. 

Christine A. Ervin, 

Assistant Secretary. Energy Efficiency and 

Renewable Energy. 

[FR Doc. 94-28044 Filed 11-10-94: 8:45 ami 

61LUNG CODE 6450-01-P 

OEPARTMENT OF TRANSPORTATION 

Federal Aviation Administration 

14 CFR Part 39 

[Docket No. 9~M-141-AD] 

Airworthiness Oirectives; Airbus Model 

A320 Series Airplanes 

AGENCY: Federal Aviation 

Administration, DOT. 

ACTION: Notice of proposed rulemaking 

(NPRM). 

SUMMARY: This document proposes the 

adoption of a new airworthiness 

directj'l,:e (AD) that is applicable to 

certain Airbus Model A320 series 

airplanes. This proposal would require 

replacement of the check valves of the 

thrust reverser with modified valves on 

certain airplane configurations and the 

replacement of the manual control 

valves of the thrust reverser with 

modified valves on certain other 

airplane configurations. This proposal is 

prompted by recent engineering 

analysiS. which revealed that if the nonretum valve installed on the hydraulic 

return line of the thrust reverser were to 

jam in the closed position. it could 

cause pressurization of the Hydraulic 

Control Unit (HCU). The actions 

specified by the proposed AD are 

intended to prevent possible 

pressurization of the HCU, due to 

jamming of the non-return valve in the 

hydraulic return line, and consequent 

deployment of a thrust reverser during 

flight. which could affect the 

controllability of the' airplane. 

OATES: Comments must be received by 

December 27,1994. 

ADDRESSES: Submit comments in 

triplicate to the Federal Aviation 

Administration (FAA). Transport 

Airplane Directorate, ANM-103. 

Attention: Rules Docket No. 94-NM141-AD, 1601 Lind Avenue, SW., 

Renton, Washington 98055-4056. 

Comments may be inspected at this 

location between 9:00 a.m. and 3:00 

p.m., Monday through Friday, except 

Federal holidays. 

The service information referenced in 

the proposed rule may be obtained from 

Airbus Industrie. 1 Rond Point Maurice 

Bellonte, 31707 Blagnac Cedex, France. 

This information mav be examined at 

the FAA. Transport Airplane 

Directorate, 1601 Lind Avenue, SW .. 

Renton, Washington. 

FOR FURTHER INFORMATION CONTACT: 

Stephen Siotte. Aerospace Engineer. 

Standardization Branch. ANM-113, 

FAA. Transport Airplane Directorate. 

1601 Lind Avenue, SW., Renton. 

Washington 98055-4056; telephone 

(206) 227-2797; fax (206) 227-1320. 

SUPPLEMENTARY INFORMATION: 

Comments Invited 

Interested persons are invited to 

participate in the making ofthe 

proposed rule by submitting such 

written data, views, or arguments as 

they may desire. Communications shall 

identify the Rules Docket number and 

be submitted in triplicate to the address 

specified above. All communications 

received on or before the closing date 

for comments. specified above, will be 

considered before taking action on the 

proposed rule. The proposals contained 

in this notice may be changed in light 

ofthe comments recei\'ed. 

Comments are specifically invited on 

the overall regulatory. economic. 

environmental. and energy aspects of 

the proposed rule. All comments 

submitted will be available, both before 

and after the closing date for comments. 

in the Rules Docket for examination bv 

interested persons. A report . 

summarizing each FAA-public contact 

concerned with the substance of this 

proposal will be filed in the Rules 

Docket. 

Commenters wishing the FAA to 

acknowledge receipt of their comments 

submitted in response to this notice 

must submit a self-addressed, stamped 

postcard on which the follOWing . 

statement is made: "Comments to 

Dm::ket Number 94-NM-141-AD." The 

postcard will be date stamped and 

returned to the commenter. 

Availability ofNPRMs 

Any person may obtain a copy or \ '··is 

NPRM by submitting a request to tIlt-