CHAPTER 17. REGULATORY IMPACT ANALYSIS 

TABLE OF CONTENTS 

17.1 INTRODUCTION ......................................................................................................... 17-1 

17.2 METHODOLOGY ........................................................................................................ 17-1 

17.2.1 Policy Considerations ........................................................................................ 17-2 

17.2.1.1 Policy Assumptions ......................................................................... 17-2 

17.2.1.2 Policy Interactions ...........................................................................17-3 

17.2.2 Non-Regulatory Policy Assumptions ................................................................ 17-3 

17.2.2.1 No New Regulatory Action ............................................................. 17-3 

17.2.2.2 Financial Incentives Policies............................................................ 17-4 

17.2.2.3 Commercial Customer Tax Credits ................................................. 17-4 

17.2.2.4 Commercial Customer Rebates........................................................ 17-5 

17.2.2.5 Early Replacement Incentives..........................................................17-8 

17.2.2.6 Bulk Government Purchases............................................................ 17-8 

17.2.2.7 Regional Energy Conservation Standards ....................................... 17-9 

17.2.3 Results Summary ...............................................................................................17-9 

LIST OF TABLES 

Table 17.2.1 Cumulative National Energy Savings in Quads for Commercial 

Refrigeration Equipment, 2012-2042 ................................................................ 17-3 

Table 17.2.2 Tax Credit Energy Savings and NPV .................................................................. 17-5 

Table 17.2.3 Average Percentage Price Reduction due to Rebate Program............................. 17-7 

Table 17.2.4 Rebate Energy Savings and NPV ........................................................................ 17-8 

Table 17.2.5 Non-Regulatory Alternatives to Standards........................................................ 17-10 

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EERE-2006-BT-STD-0126 COMMENT 52.2 
17-ii 

EERE-2006-BT-STD-0126 COMMENT 52.2 
CHAPTER 17. REGULATORY IMPACT ANALYSIS 

17.1 INTRODUCTION 

Under the Process Rule, the U.S. Department of Energy (DOE) is committed to exploring 

non-regulatory alternatives to energy conservation standards. DOE will prepare a draft 

regulatory analysis under Executive Order 12866, “Regulatory Planning and Review,” which 

will be subject to review by the Office of Information and Regulatory Affairs. 58 FR 51735 

(September 30, 1993). 

DOE identified five major alternatives to energy conservation standards as feasible policy 

options to achieve product energy efficiency. It will evaluate each alternative in terms of its 

ability to achieve significant energy savings at a reasonable cost, and will compare the 

effectiveness of each alternative to the effectiveness of the proposed standard. 

The non-regulatory means of achieving energy savings that DOE proposes to analyze are 

listed below. The Technical Support Document (TSD) in support of DOE’s Notice of Proposed 

Rulemaking will include a quantitative analysis of each alternative, the methodology for which is 

discussed briefly below. 

•	 no new regulatory action 

•	 commercial customer tax credits 

•	 commercial customer rebates 

•	 early replacement 

•	 bulk government purchases 

17.2 METHODOLOGY 

DOE used the national energy savings (NES) spreadsheet model to calculate the NES and 

the net present value (NPV) corresponding to each alternative of the proposed standards. The 

NES spreadsheet model is discussed extensively in Chapter 11 of the TSD. To compare each 

alternative quantitatively to proposed energy conservation standards, it was first necessary to 

quantify the effect of each alternative on the purchase and use of energy-efficient commercial 

equipment. Once each alternative is properly quantified, DOE made the appropriate revisions to 

the inputs in the NES spreadsheet model. Key inputs that DOE revised in the NES spreadsheet 

model are: 

•	 energy prices and escalation factors; 

•	 implicit market discount rates for trading off purchase price against operating 

expense when choosing equipment efficiency; 

•	 customer purchase price, operating cost, and income elasticities; 

•	 customer price versus efficiency relationships; and 

•	 equipment stock data (purchase of new equipment or turnover rates for 

inventories). 

The key measures of the impact of each alternative will be as listed below. 

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EERE-2006-BT-STD-0126 COMMENT 52.2 
•	 Commercial energy use in Quads (1015 Btu); the cumulative energy use of the 

equipment from 2012 to 2042. DOE reports electricity consumption in terms of 

primary energy. 

•	 National energy savings is the cumulative national energy use from the base case 

projection less the alternative policy case projection. 

•	 Net present value is the value of future operating cost savings from commercial 

refrigeration equipment bought in the period from 2012 to 2062. DOE calculates 

the NPV as the difference between the present value of equipment and operating 

expenditures (including energy) in the base case, and the present value of 

expenditures in each alternative policy case for the life of the equipment. DOE 

discounts future operating and equipment expenditures to 2008 using seven and 

three percent real discount rates. 

17.2.1 Policy Considerations 

17.2.1.1 Policy Assumptions 

The impacts of non-regulatory programs are uncertain by nature, since they depend on 

program implementation and marketing efforts, and the subsequent response in customer 

behavior. The projected impacts depend on the assumptions for the customer participation rate, 

and are therefore subject to greater uncertainty than the impacts of mandatory standards, which 

DOE assumed would have full compliance. 

DOE assumed that each alternative policy would induce commercial customers to 

voluntarily purchase at least some additional more energy efficient units as opposed to 

mandatory purchases of more efficient equipment that would result from the proposed energy 

conservation standards at any of the candidate standard levels (TSLs). Table 17.2.1 shows the 

energy savings associated with standards at each of the considered TSLs (see Chapter 11 of the 

TSD for additional information). In contrast to a standard at one of the TSLs, however, the 

adoption rate of the alternative non-regulatory policy cases may not be 100 percent, which would 

result in lower energy savings than a standard. 

DOE assumed that the non-regulatory policy effects last from the assumed start date for 

the mandatory amended energy conservation standards, 2012, through the end of the analysis 

period, 2042 for energy savings and 2062 for NPV. This simplifying assumption means that the 

policy affects the market for the entire analysis period, whether or not the incentives actually 

continue. DOE did not consider administrative costs for any of the non-regulatory policies in its 

analysis. Inclusion of such costs would decrease the NPV by a small amount. 

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EERE-2006-BT-STD-0126 COMMENT 52.2 
 

Table 17.2.1 Cumulative National Energy Savings in Quads for Commercial Refrigeration 

Equipment, 2012-2042 

Equipment 

Class 

National Energy Savings (quads*) by Trial Standard 

Level 

TSL 1 TSL 2 TSL 3 TSL 4 TSL 5 

VOP.RC.M 0.057 0.082 0.157 0.157 0.294 

VOP.RC.L 0.006 0.011 0.012 0.018 0.018 

VOP.SC.M 0.006 0.016 0.031 0.031 0.041 

VCT.RC.M 0.001 0.002 0.024 0.025 0.025 

VCT.RC.L 0.035 0.392 0.561 0.574 0.574 

VCT.SC.I 0.009 0.023 0.027 0.028 0.028 

VCS.SC.I 0.000 0.001 0.002 0.002 0.002 

SVO.RC.M 0.029 0.043 0.085 0.085 0.157 

SVO.SC.M 0.005 0.015 0.033 0.033 0.043 

SOC.RC.M 0.002 0.007 0.014 0.014 0.048 

HZO.RC.M 0.001 0.005 0.008 0.008 0.008 

HZO.RC.L 0.013 0.028 0.032 0.032 0.032 

HZO.SC.M 0.000 0.001 0.002 0.002 0.002 

HZO.SC.L 0.001 0.003 0.007 0.007 0.007 

HCT.SC.I 0.002 0.016 0.017 0.019 0.019 

Total 0.168 0.645 1.013 1.035 1.298 

*0.000 indicates savings are less than 0.0005 quadrillion Btu. 

17.2.1.2 Policy Interactions 

DOE calculated the impacts of each regulatory policy separately from those of the other 

policies. In actual practice, certain policies are often most effective when implemented in 

combination to provide incentives, such as early replacement and customer rebates, or early 

replacement and bulk government purchases. DOE attempted to make conservative assumptions 

to avoid double-counting policy impacts. Therefore, the policy impacts reported below are not 

additive (i.e. the combined impact of several or all of the policies may not be inferred by adding 

the results together). 

17.2.2 Non-Regulatory Policy Assumptions 

17.2.2.1 No New Regulatory Action 

The case in which no regulatory action is taken constitutes the base case scenario 

described in the CRE TSD, (See Chapter 11, National Impact Analysis). From its assessment of 

current market shares and equipment and operating costs, DOE estimated forecasted shipments 

and the distribution of efficiencies of the stock, from 2012 through 2042. This defines the basis 

of comparison for all other scenarios, including the policy cases and the standard cases. By 

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EERE-2006-BT-STD-0126 COMMENT 52.2 
 

definition, no new regulatory action yields zero energy savings and a net present value of zero 

dollars. 

17.2.2.2 Financial Incentives Policies 

DOE considered several scenarios in which the Federal government would provide some 

form of financial incentive. It analyzed in detail two types of incentives: commercial customer 

tax credits and commercial customer rebates. Tax credits could be granted to commercial 

customers who purchase high efficiency CRE equipment. Alternatively, the government could 

issue tax credits to manufacturers to offset costs associated with producing high-efficiency 

equipment. For this analysis, only a commercial customer tax credit, patterned after provisions 

in the EPACT of 2005, was considered. The second incentive program involved a commercial 

customer rebate program that was nominally patterned after existing rebate programs currently 

offered by several utilities. 

17.2.2.3 Commercial Customer Tax Credits 

DOE assumed a (commercial or industrial) customer tax credit that is patterned after the 

tax credits that were created in EPACT 2005. EPACT 2005 provided tax credits to customers 

who purchase and install specific products such energy-efficient windows, insulation, doors, 

roofs, and heating and cooling equipment. For many of these equipment types, the tax credit is 

equal to the 10 percent of the retail cost, up to specific dollar limits. 

For the CRE tax credits analysis, DOE presumed the presence of a certification or other 

program that could be used to identify high efficiency CRE products by energy consumption. 

ARI is currently working to develop such a certification program. DOE proposed TSL 3 and 

TSL 5 as likely candidate levels for a tax credit incentive. TSL 3 was chosen given that DOE 

had already identified it as the minimum life-cycle cost level and maximum-NPV level for CRE 

customers. TSL 5 is the max-tech efficiency level and provides the maximum energy savings for 

each customer incentivized to purchase TSL 5 equipment. 

DOE reviewed the incremental customer price increase to reach each efficiency level 

across all 15 equipment classes. For 12 of the equipment classes (VOP.RC.M, VOP.RC.L, 

VOP.SC.M, VCT.RC.M, VCT.RC.L, VCT.SC.I, VCS.SC.I, SVO.RC.M, SVO.SC.M, 

HZO.SC.M, HZO.SC.L, and HCT.SC.I), the incremental price at TSL 3 was between 6.8 and 

22.5 percent higher than for baseline equipment. For three equipment classes (SOC.RC.M, 

HZO.RC.M, and HZO.RC.L), the incremental cost was less than six percent. For the TSL 3 tax 

credit scenario analysis, DOE assumed a tax credit equal to five percent of the customer prices 

could be applied to the 12 product classes, but did not provide a credit for the three product 

classes for which the incremental cost was less than six percent. The credits were assumed to 

apply only to the retail cost of the equipment and not to any additional costs related to 

installation. 

The cost increments from the baseline to reach TSL 5 is wider than to reach TSL 3, 

ranging from a 4.0 percent to a 83.1 percent cost increase. Three products at TSL 5 had a total 

incremental cost increase of less than 10 percent (HZO.RC.M , HZO.RC.L, and VCS.SC.I). 

Three additional equipment classes had an incremental cost of less than 20 percent (HZO.SC.M, 

HCT.SC.I, HZO.SC.L). The remaining nine equipment classes had incremental cost increases of 

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EERE-2006-BT-STD-0126 COMMENT 52.2 
21 to 83 percent. DOE opted to analyze a scenario DOE where a tax credit equal to 10 percent 

of the customer prices would be available for purchase of TSL 5 efficiency level equipment for 

12 product classes (HZO.SC.M, HCT.SC.I, HZO.SC.L, VOP.RC.L, SOC.RC.M, VCT.RC.M, 

VCT.RC.L, VCT.SC.I, SVO.RC.M, SVO.SC.M, VOP.SC.M, VOP.RC.M). It assumed no tax 

credit incentive for the three product classes for which the incremental cost was less than 10 

percent at TSL 5. 

The presence of a commercial customer tax credit in either the TSL 3 or TSL 5 tax credit 

scenario elicits greater purchases of equipment with efficiencies above the baseline, which leads 

to higher average aggregate efficiency and lower average aggregate energy consumption. The 

change in market shares that may result from a five-percent tax credit scenario or the 10-percent 

tax credit scenario was estimated per the method described in Chapter 11, and was similarly done 

for the analysis for commercial customer rebates. No change in total equipment sales was 

presumed. 

From a societal point of view, tax credits, like rebates, do not change the installed cost of 

the commercial refrigeration equipment; they simply transfer a portion of the cost from the 

customer to taxpayers as a whole. Thus, for calculation of total cost of equipment in the 

modified NIA study, the increase in sales by efficiency level due to tax credits estimates are 

multiplied by the pre-rebate costs identical to those used in the base NIA discussed in Chapter 

11. 

Table 17.2.2 compares the cumulative energy savings and calculated NPV for the 

national rebate program envisioned with those of the proposed standards action. 

Table 17.2.2 Tax Credit Energy Savings and NPV 

Policy alternatives 

Cumulative Energy 

Savings* 

(quads), 2012-2042 

Net Present Value** 

(billion 2006$), 2012-2062 

7% 

Discount Rate 

3% 

Discount Rate 

No New Regulatory Action 0 0 0 

Commercial Customer Tax Credits (5% Scenario) 0.111 0.231 0.489 

Commercial Customer Tax Credits (10% Scenario) 0.082 0.140 0.303 

Today's Standards at TSL 4 1.035 1.414 3.930 *

 Energy savings are in source quads.

** Net present value is the value in the present of a time series of costs and savings. 

17.2.2.4 Commercial Customer Rebates 

DOE modeled the impact of the customer rebate policy by determining the increased 

customer participation rate due to the rebates (i.e., the percentage increase in customers 

purchasing high-efficiency equipment). It then applied the resulting increase in market share of 

efficient units to the NES Spreadsheet Model to estimate the resulting NES and NPV with 

respect to the base case. 

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EERE-2006-BT-STD-0126 COMMENT 52.2 
After reviewing several utility rebate programs currently in place (see Chapter 3 of the 

TSD), DOE decided to pattern the analysis of a national rebate program after the EnergySmart 

Grocer program offered by the California Public Utilities Commission, which provides rebates 

for the use of specific component technologies. Several other utility programs identified in 

Chapter 3 also appear to provide rebates for similar CRE component technologies. None of the 

programs base rebates on an energy consumption threshold, as that data is largely unavailable 

from either manufacturers or a central source such as a certification program. Eligible 

participants in the EnergySmart Grocer program include grocery and convenience stores, food 

processors, and refrigerated warehouses operating in Pacific Gas & Electric, Southern California 

Edison, or San Diego Gas & Electric service territories. 

Rebates were not considered in two cases. In the first case, for the rebate programs 

identified in Chapter 3 provide rebates based on improved components, rebates are generally 

available for both new equipment purchases and for retrofits to existing commercial refrigeration 

equipment, although often at different rebated levels and with qualifiers. For the RIA, DOE only 

considered rebates on newly purchased commercial refrigeration equipment and not for retrofit 

of existing equipment, as the standards action for which a non regulatory approach is being 

compared with only addresses newly purchased equipment. In the second case, other utility 

rebate or incentive programs available to CRE customers provide general rebates based on the 

calculated annual kWh or kW reduction estimates, however such programs were not considered 

by DOE in the RIA as these programs do not specifically target commercial refrigeration 

equipment. 

Under the EnergySmart Grocer programs, commercial and industrial businesses that 

purchase commercial refrigeration equipment can receive payments for the incorporation of 

specific technologies and/or for specific performance characteristics achieved in various classes 

of commercial refrigeration equipment such as display cases, walk in coolers, and equipment 

with remote condensers. Other rebate programs analyzed did not necessarily define the same set 

of minimum conditions for eligibility. 

DOE reviewed and incorporated, in the RIA, the rebates offered for energy saving 

technologies considered applicable to the commercial refrigeration equipment product classes 

analyzed in the engineering analysis. The technologies examined and rebates applied were: 

Low-heat doors, $50/door; ECM motors, $20 per display case evaporator fan motor; LED 

Lamps, $56 for each fluorescent lamp replaced. These values are currently used in the 

EnergySmart Grocer program and represent values roughly in the middle of the ranges found for 

other rebate programs. Where these technologies are employed in each class of commercial 

refrigeration equipment, the average first cost reduction to all customers was calculated for each 

of the efficiency levels analyzed in the LCC. The average percentage cost reduction was 

calculated for each efficiency level in turn taking the rebates into account. 

The rebates were then entered into the LCC analysis spreadsheet for each equipment 

class as percentage reductions in equipment price. When compared against the incremental retail 

price of higher efficiency commercial refrigeration equipment, as developed in Chapter 8 of the 

TSD, the rebates range between 0 percent to up to 18 percent of the customer price depending on 

TSL level and equipment class. Table 17.2.3 shows the calculated rebates by equipment class at 

each TSL Level. For example, under the provisions of the national rebate program constructed 

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EERE-2006-BT-STD-0126 COMMENT 52.2 
 

for this analysis, a vertical closed transparent, remote condensing, low temperature display case 

(VCT.RC.L) would receive a rebate equivalent to 4.92 percent of the average purchase price, not 

including installation, at TSL 3. At TSL 5, the total rebate for incorporation of the set of 

technologies would be 4.87 percent of the purchase price. 

Table 17.2.3 Average Percentage Price Reduction due to Rebate Program 

Equipment 

Class* 

Calculated Average Percentage Price Reduction due to 

Rebate Program 

TSL 1 TSL 2 TSL 3 TSL 4 TSL 5 

VOP.RC.M 

VOP.RC.L 

VOP.SC.M 

VCT.RC.M 

VCT.RC.L 

VCT.SC.I 

VCS.SC.I 

SVO.RC.M 

SVO.SC.M 

SOC.RC.M 

HZO.RC.M 

HZO.RC.L 

HZO.SC.M 

HZO.SC.L 

HCT.SC.I 

1.96% 1.93% 1.84% 1.84% 17.94% 

2.97% 2.86% 2.83% 7.11% 7.11% 

1.26% 2.98% 2.72% 2.72% 13.80% 

0.00% 1.04% 5.45% 5.41% 5.41% 

0.95% 2.90% 4.92% 4.87% 4.87% 

2.84% 4.23% 4.09% 4.66% 4.66% 

0.00% 1.31% 2.45% 2.45% 2.45% 

1.46% 1.44% 1.39% 1.39% 15.77% 

0.78% 1.49% 1.36% 1.36% 12.04% 

0.00% 0.75% 0.74% 0.74% 7.99% 

0.00% 1.30% 1.28% 1.27% 1.27% 

1.29% 1.26% 1.25% 1.25% 1.25% 

0.00% 0.86% 1.61% 1.57% 1.57% 

0.00% 0.73% 1.34% 1.31% 1.31% 

0.00% 0.00% 1.23% 1.18% 1.18% * Equipment class designations consist of a combination (in sequential order separated by periods) of a equipment family code 

(VOP=vertical open, SVO=semivertical open, HZO=horizontal open, VCT=vertical transparent doors, VCS=vertical solid doors, 

HCT=horizontal transparent doors, HCS=horizontal solid doors, or SOC=service over counter), an operating mode code (RC=remote 

condensing or SC=self-contained), and a rating temperature code (M=medium temperature (38°F), L=low temperature (0°F), or I=icecream temperature (-15°F)). For example, "VOP.RC.M refers to the "vertical open, remote condensing, medium temperature" equipment 

class. See Chapter 3, Market and Technology Assessment, of the TSD for a more detailed explanation of the equipment class terminology 

The rebates elicit increased purchases of higher efficiency equipment that lower the 

overall average annual energy consumption per unit. Using the method described in Chapter 11 

of the TSD to estimate market shares, a new distribution of sales by efficiency level 

(corresponding to the various TSLs) was computed. The resulting increase in sales of higher 

efficiency level equipment results in energy savings compared with the base case. 

Although the rebate program lowers the retail cost to the customer, it must be financed by 

tax revenues. So, from a societal point of view, the installed cost at any efficiency level does not

change with the rebate policy, it simply transfers part of the cost from the customer to taxpayers 

as a whole. Thus, the calculation of equipment total cost in the rebate case is calculated as the 

revised estimated sales by efficiency level due to the rebates multiplied by the pre-rebate 

equipment prices (identical to those in the base NIA discussed in Chapter 11). Table 17.2.4 

compares the cumulative energy savings and calculated NPV for the national rebate program 

envisioned with those of the proposed standards action. 

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EERE-2006-BT-STD-0126 COMMENT 52.2 
 

Table 17.2.4 Rebate Energy Savings and NPV 

Policy alternatives 

Cumulative Energy 

Savings* 

(quads), 2012-2042 

Net Present Value** 

(billion 2006$), 2012-2062 

7% 

Discount Rate 

3% 

Discount Rate 

No New Regulatory Action 0 0 0 

Commercial Customer Rebates 0.107 0.157 0.345 

Today's Standards at TSL 4 1.035 1.414 3.930 *

 Energy savings are in source quads.

** Net present value is the value in the present of a time series of costs and savings. 

17.2.2.5 Early Replacement Incentives 

Early replacement refers to the replacement of commercial refrigeration equipment 

before the end of their useful lives. The purpose of this policy is to retrofit or replace old, 

inefficient equipment with high efficiency units. DOE studied the feasibility of a Federal 

program to promote early replacement of appliances and equipment under EPACT 1992. In this 

study, DOE identified Federal policy options for early replacement that include a direct national 

program, replacement of Federally-owned equipment, promotion through equipment 

manufacturers, customer incentives, incentives to utilities, market behavior research, and 

building regulations. 

While cost-effective opportunities to install units that are more efficient exist, DOE 

determined that a Federal early replacement program is not economically justified because the 

market for CRE is relatively small and distributed across abroad set of customers, the savings are 

not expected to be significant. In addition, a temporary surge in CRE sales in the early 2000s 

effectively reduces the size of the market that would be subject to early replacement, thus further 

reducing the potential for an effective early replacement program. 

17.2.2.6 Bulk Government Purchases 

In this policy alternative, bulk government purchases refers to Federal, State, and local 

governments being encouraged to purchase equipment meeting the energy conservation 

standards. The motivations for this policy are that (1) aggregating public sector demand could 

provide a market signal to manufacturers and vendors that some of their largest customers seek 

suppliers with equipment that meet an efficiency target at good prices, and (2) this could induce 

“market pull” impacts through the effects of manufacturers and vendors achieving economies of 

scale for high efficiency equipment. 

As with the early replacement, bulk government purchases may provide cost effective 

opportunities to install more efficient equipment on a limited basis, however it was concluded 

that a widespread bulk purchase program was not economically justified. This is because the 

segment/share of the market that would be affected by a bulk government purchase program is a 

small portion of an already relatively small market, as the vast majority of the shipments/sales 

are to non-governmental customers. 

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EERE-2006-BT-STD-0126 COMMENT 52.2 
17.2.2.7 Regional Energy Conservation Standards 

DOE lacks authority to adopt regional standards, so it must reject this alternative. 

However, DOE does have authority to grant State petitions for an exemption from Federal 

preemption of higher standards, if the State filing the petition demonstrates unusual and 

compelling State or local energy interests (42 U.S.C. 6297(d) and 6316(b)(2)(D)). The State has 

a heavy burden in making such a showing, and DOE must reject the petition if “interested 

persons” establish that the State regulation would “significantly burden manufacturing, 

marketing, distribution, sale or servicing” of the covered equipment on a national basis. 

(42 U.S.C. 6297(d)) 

Because of the potential variability of standards by State and the widely differing 

economic and climate situations, DOE did not undertake a quantitative analysis of regional 

standards. 

17.2.3 Results Summary 

Table 17.2.5 shows the national energy savings (NES) and NPV for the non-regulatory 

alternatives analyzed. The case in which no regulatory action is taken with regard to commercial 

refrigeration equipment constitutes the base case (or "No Action") scenario. Since this is the 

base case, energy savings and NPV are zero by definition. For comparison, the table includes 

the results of the NES and NPV for TSL 4 associated with a possible energy conservation 

standard. Energy savings expressed in quadrillion Btu (Quads) in terms of primary or source 

energy, which includes generation and transmission losses from electricity utility sector (the 

estimation of source energy is explained in Chapter 10. The NPVs shown in the table refer to the 

NPV for commercial customers based on real discount rates of 7 and 3 percent. 

As indicated in Table 17.2.5, none of the policy alternatives DOE examined would save 

as much energy as and have a lower NPV than several of the TSLs for energy conservation 

standards. Also, several of the alternatives would require new enabling legislation, such as 

commercial customer or Federal tax credits, since authority to carry out those alternatives does 

not presently exist. 

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EERE-2006-BT-STD-0126 COMMENT 52.2 
Table 17.2.5 Non-Regulatory Alternatives to Standards 

Policy alternatives 

Cumulative Energy 

Savings* 

(quads), 2012-2042 

Net Present Value** 

(billion 2006$), 2012-2062 

7% 

Discount Rate 

3% 

Discount Rate 

No New Regulatory Action 0 0 0 

Commercial Customer Tax Credits: 5% 0.111 0.231 0.489 

Commercial Customer Tax Credits: 10% 0.082 0.140 0.303 

Commercial Customer Rebates 0.107 0.157 0.345 

Today's Standards at TSL 4 0.715 1.20 3.25 *

 Energy savings are in source quads.

** Net present value is the value in the present of a time series of costs and savings. 

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EERE-2006-BT-STD-0126 COMMENT 52.2 
REFERENCES 

1.	 U.S. Department of Energy. Energy Information Administration. Commercial Sector 

Demand Model of the National Energy Modeling System: Model Documentation 2007. 

DOE/EIA-M066(2007). 

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