CHAPTER 11: NATIONAL IMPACT ANALYSIS 

TABLE OF CONTENTS 

11.1 INTRODUCTION ......................................................................................................... 11-1 

11.2 BASE CASE AND STANDARDS CASE FORECASTED EFFICIENCIES .............. 11-2 

11.2.1 Cooktops and Ovens ...................................................................................................... 11-3 

11.2.2 Microwave Ovens .......................................................................................................... 11-7 

11.3 NATIONAL ENERGY SAVINGS ............................................................................... 11-8 

11.3.1 NES Definition............................................................................................................... 11-8 

11.3.2 NES Inputs..................................................................................................................... 11-9 

11.3.2.1 Annual Energy Consumption per Unit ...................................................... 11-10 

11.3.2.2 Shipments...................................................................................................11-13 

11.3.2.3 Equipment Stock........................................................................................ 11-13 

11.3.2.4 National Annual Energy Consumption...................................................... 11-13 

11.3.2.5 Energy Site-to-Source Conversion Factors................................................ 11-13 

11.4 NET PRESENT VALUE............................................................................................. 11-14 

11.4.1 NPV Definition ............................................................................................................ 11-14 

11.4.2 NPV Inputs................................................................................................................... 11-16 

11.4.2.1 Total Installed Cost per Unit...................................................................... 11-16 

11.4.2.2 Annual Operating Cost Savings per Unit................................................... 11-20 

11.4.2.3 Total Annual Installed Cost Increases ....................................................... 11-21 

11.4.2.4 Total Annual Operating Cost Savings ....................................................... 11-21 

11.4.2.5 Discount Factors ........................................................................................ 11-21 

11.4.2.6 Present Value of Costs............................................................................... 11-22 

11.4.2.7 Present Value of Savings........................................................................... 11-22 

11.4.3 Fuel Switching ............................................................................................................. 11-22 

11.5 NES AND NPV RESULTS......................................................................................... 11-25 

11.5.1 NES and NPV Input Summary .................................................................................... 11-25 

11.5.2 NES Results ................................................................................................................. 11-26 

11.5.2.1 Cooktops and Ovens..................................................................................11-26 

11.5.2.2 Microwave Ovens...................................................................................... 11-27 

11.5.3 Annual Costs and Savings ........................................................................................... 11-28

11.5.4 NPV Results................................................................................................................. 11-29 

11.5.4.1 Cooktops and Ovens..................................................................................11-30 

11.5.4.2 Microwave Ovens...................................................................................... 11-31 

11.6 IMPACT OF STANDARDS ON NATURAL GAS AND ELECTRICITY 

PRICES AND ASSOCIATED CONSUMER BENEFITS ......................................... 11-31 

11.6.1 Impact on Natural Gas Prices ...................................................................................... 11-31 

11.6.2 Impact on Electricity Prices......................................................................................... 11-35 

11-i 

EERE-2006-STD-0127 COMMENT 64.2
LIST OF TABLES 

Table 11.2.1 Electric Coil Cooktops: Base Case and Standards Case Efficiency 

Distributions in 2012.......................................................................................... 11-4 

Table 11.2.2 Electric Smooth Cooktops: Base Case and Standards Case Efficiency 

Distributions in 2012.......................................................................................... 11-4 

Table 11.2.3 Gas Cooktops: Base Case and Standards Case Efficiency Distributions in 

2012.................................................................................................................... 11-4 

Table 11.2.4 Electric Standard Ovens: Base Case and Standards Case Efficiency 

Distributions in 2012.......................................................................................... 11-5 

Table 11.2.5 Electric Self-Cleaning Ovens: Base Case and Standards Case Efficiency 

Distributions in 2012.......................................................................................... 11-5 

Table 11.2.6 Gas Standard Ovens: Base Case and Standards Case Efficiency 

Distributions in 2012.......................................................................................... 11-6 

Table 11.2.7 Gas Self-Cleaning Ovens: Base Case and Standards Case Efficiency 

Distributions in 2012.......................................................................................... 11-6 

Table 11.2.8 Microwave Ovens: Base Case and Standards Case Efficiency 

Distributions by Energy Factor Level in 2012................................................... 11-8 

Table 11.3.1 National Energy Saving Inputs ........................................................................ 11-10 

Table 11.3.2 Cooktops: Base Case and Standards Case Shipment-Weighted Average 

Per-Unit Annual Energy Consumption in 2012............................................... 11-10 

Table 11.3.3 Ovens: Base Case and Standards Case Shipment-Weighted Average PerUnit Annual Energy Consumption in 2012 ..................................................... 11-11 

Table 11.3.4 Microwave Ovens: Base Case and Standards Case Shipment-Weighted 

Average Per-Unit Annual Energy Consumption in 2012 ................................ 11-12 

Table 11.3.5 Site-to-Source Conversion Factors for Electricity and Natural Gas................ 11-14 

Table 11.4.1 Net Present Value Inputs ................................................................................. 11-16 

Table 11.4.2 Cooktops: Base Case and Standards Case Shipment-Weighted Average 

Per-Unit Total Installed Costs in 2012............................................................. 11-17 

Table 11.4.3 Ovens: Base Case and Standards Case Shipment-Weighted Average PerUnit Total Installed Costs in 2012 ................................................................... 11-18 

Table 11.4.4 Microwave Ovens: Base Case and Standards Case Shipment-Weighted 

Average Per-Unit Total Installed Costs in 2012.............................................. 11-20 

Table 11.4.5 Installation Cost for an Electrical Outlet to accommodate an Electric 

Cooking Product .............................................................................................. 11-23 

Table 11.4.6 Installation Cost for a Branch Circuit to accommodate an Electric Cooking 

Product............................................................................................................. 11-24 

Table 11.5.1 NES and NPV Inputs ....................................................................................... 11-25 

Table 11.5.2 Cooktops: Cumulative NES Results ............................................................... 11-26 

Table 11.5.3 Ovens: Cumulative NES Results .................................................................... 11-26 

Table 11.5.4 Cooktops: Cumulative NES Results Discounted at Seven Percent and 

Three Percent ................................................................................................... 11-27 

Table 11.5.5 Ovens: Cumulative NES Results Discounted at Seven Percent and Three 

Percent.............................................................................................................. 11-27 

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EERE-2006-STD-0127 COMMENT 64.2
Table 11.5.6 Microwave Ovens: Cumulative NES Results................................................. 11-27 

Table 11.5.7 Microwave Ovens: Cumulative NES Results Discounted at Seven Percent 

and Three Percent ............................................................................................ 11-28 

Table 11.5.8 Cooktops: Cumulative NPV Results based on Seven-Percent and ThreePercent Discount Rates .................................................................................... 11-30 

Table 11.5.9 Ovens: Cumulative NPV Results based on Seven-Percent and ThreePercent Discount Rates .................................................................................... 11-30 

Table 11.5.10 Microwave Ovens: Cumulative NPV Results based on Seven-Percent and 

Three-Percent Discount Rates.......................................................................... 11-31 

Table 11.6.1 Impact of Max Tech Standard Levels on Natural Gas Consumption and 

Average Wellhead Price in 2030 ..................................................................... 11-33 

Table 11.6.2 Implicit Natural Gas Inverse Price Elasticity from Seven Energy Models ..... 11-34 

Table 11.6.3 Impact of Max Tech Standard Levels on Electricity Consumption and 

Price in 2030 .................................................................................................... 11-36 

LIST OF FIGURES 

Figure 11.2.1 Gas Cooking Products: Forecast of Products with Standing Pilots .................. 11-7 

Figure 11.3.1 Gas Cooktops and Gas Standard Ovens: Forecasted Base Case Annual 

Energy Consumption ....................................................................................... 11-12 

Figure 11.4.1 Gas Cooktops and Gas Standard Ovens: Forecasted Base Case Total 

Installed Costs.................................................................................................. 11-19 

Figure 11.5.1 Non-Discounted Annual Installed Cost Increases and Annual Operating 

Cost Savings for Microwave Ovens, TSL 3 .................................................... 11-29 

Figure 11.6.1 Wellhead Natural Gas Price Change in 2030 Resulting from Reduced 

Natural Gas Consumption Associated with Max Tech Standard Levels......... 11-32 

Figure 11.6.2 Inverse Natural Gas Price Elasticity from NEMS Analysis for Cooking 

Product Max Tech Standard Levels................................................................. 11-33 

Figure 11.6.3 Electricity Price Change in 2030 Resulting from Reduced Electricity 

Consumption Associated with Max Tech Standard Levels ............................. 11-36 

Figure 11.6.4 Inverse Electricity Price Elasticity from NEMS Analysis for Cooking 

Product Max Tech Standard Levels................................................................. 11-37 

11-iii 

EERE-2006-STD-0127 COMMENT 64.2
CHAPTER 11. NATIONAL IMPACT ANALYSIS 

11.1 INTRODUCTION 

This chapter describes the method for estimating national impacts for cooking products, 

i.e., the quantity and net value to consumers of future national energy savings (NES) from 

possible trial standard levels (TSL). Chapter 9 provides identifies and describes the TSLs for 

cooking products. Results described here include: (1) national energy consumption and savings, 

(2) monetary value of energy savings to the Nation due to TSLs, (3) increased total installed 

costs to the Nation due to TSLs, and (4) the net present value (NPV) of energy savings 

(difference between value of energy savings and increased total installed costs). 

DOE determined both the NES and NPV for all of the TSLs considered for cooking 

products. It performed all calculations for each of the considered products using a Microsoft 

Excel spreadsheet model, which is accessible on the Internet 

(http://www.eere.energy.gov/buildings/appliance_standards/). Each product’s spreadsheet 

model, referred to as the National Impact Analysis (NIA) Model, combined the calculations for 

determining the NES and NPV as well as input from the relevant Shipments Model. Details and 

instructions for using each of the NIA Models are provided in Appendix 10A. 

The important facets of national energy consumption of the considered products include: 

(1) shipments of the equipment, (2) customer response to changes in total installed cost (i.e., 

purchase price plus installation costs), operating expense, and household income, and (3) 

voluntary programs promoting higher energy efficiency of equipment. 

Chapter 10 provides a detailed description of the Shipments Models that DOE used to 

forecast future purchases of the considered products. Included in the discussion are detailed 

descriptions of consumers’ sensitivities to total installed cost, operating expense, and income 

(otherwise known as elasticities), and how DOE captured them within the model. 

Concerning voluntary programs, although they may increase the share of energy efficient 

equipment prior to the implementation date of any new TSLs, DOE was not able to obtain 

information that quantified how such programs affect equipment efficiencies on a national basis. 

Consequently, DOE did not explicitly incorporate the impact of market-based initiatives into the 

shipments forecasts detailed in Chapter 10. 

The technical support document (TSD) for DOE’s notice of proposed rulemaking 

(NOPR) covered conventional cooking products (i.e., cooktops and ovens), microwave oven 

energy factor (EF), microwave oven standby power consumption, and commercial clothes 

washers (CCW).1

 This chapter presents information and results pertaining solely to conventional 

cooking products and microwave oven EF. The impact of more-efficient equipment on 

microwave oven standby power and CCWs will be addressed in subsequent TSDs. 

11-1 

EERE-2006-STD-0127 COMMENT 64.2
11.2 BASE CASE AND STANDARDS CASE FORECASTED EFFICIENCIES 

A key component of DOE’s estimates of NES and NPV is the energy efficiencies 

forecasted over time for the base case (without new standards) and each of the standards cases 

(with new standards). The forecasted efficiencies represent the annual shipment-weighted 

energy efficiency of the products under consideration over the forecast period (i.e., from the 

assumed effective date of a new standard to 30 years after the standard becomes effective). 

Because key inputs to the calculation of the NES and NPV are dependent on the estimated 

efficiencies, these efficiencies are of great importance to the analysis. In the case of the NES, the 

per-unit annual energy consumption is a direct function of product efficiency. Chapter 6, Energy 

Use Determination, describes how the per-unit energy consumption vary as a function of 

efficiency for each of the considered products. With regard to the NPV, two inputs, the per-unit 

total installed cost and the per-unit annual operating cost, are dependent on efficiency. The perunit total installed cost is a direct function of efficiency while the per-unit annual operating cost, 

because it is a function of the per-unit annual energy consumption, is indirectly dependent on 

product efficiency. Section 8.2.1 of Chapter 8, Life-Cycle Cost (LCC) and Payback Period 

(PBP) Analysis, describes how per-unit total installed costs vary as a function of efficiency for 

each of the considered products. The above NES and NPV inputs, as well as all other inputs to 

the calculation of the NES and NPV, are also discussed below in sections 10.3.1 and 10.4.1. 

For each of the products considered, DOE based the development of the product 

efficiencies in the base case on the assignment of equipment efficiencies in the base case for the 

year 2005. In other words, DOE determined the distribution of product efficiencies currently in 

the marketplace to develop a shipment-weighted efficiency for the year 2005. For a complete 

discussion of the assignment of efficiencies in the base case for each of the considered products, 

refer to section 8.2.6 of Chapter 8, LCC and PBP Analysis. 

Using the shipment-weight efficiency for the year 2005 as a starting point, DOE 

developed base case forecasted efficiencies based on assumptions regarding future efficiency 

growth. For the period spanning 2005–2012 (2012 being the assumed effective date of a new 

standard), DOE assumed that there would be no growth in the shipment-weighted efficiency (i.e., 

no change in the distribution of product efficiencies). Because there are no historical data to 

indicate how product efficiencies have changed over time, DOE estimated that forecasted 

efficiencies remained frozen at the 2012 efficiency level until the end of the forecast period (30 

years after the assumed effective date—the year 2042). Although DOE recognizes the 

possibility that product efficiencies may change over time, DOE does not want to speculate as to 

how these product efficiencies may change without historical information. As described below 

in Section 11.2.1, DOE did forecast the market share of gas standard ranges equipped with 

standing pilots to estimate the impact of eliminating standing pilots for gas cooktops and gas 

standard ovens. 

For its determination of standards-case forecasted efficiencies, DOE assumed a “roll-up” 

scenario to establish the shipment-weighted efficiency for the year that standards are assumed to 

become effective (i.e., 2012). DOE assumed that product efficiencies in the base case that did 

not meet the standard under consideration would “roll up” to meet the new standard level. Also, 

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EERE-2006-STD-0127 COMMENT 64.2
DOE assumed that all product efficiencies in the base case that were above the standard under 

consideration would not be affected. Using the shipment-weighted efficiency in the year 2012 as 

a starting point, DOE developed standards-case forecasted efficiencies based on assumptions 

regarding future efficiency growth. For all of the considered products, DOE made the same 

assumptions regarding standards-case efficiency growth rates as for the base case— namely, that 

forecasted efficiencies remain frozen at the 2012 efficiency level until the end of the forecast 

period. By maintaining the same growth rate for forecasted efficiencies in the standards case as 

in the base case (i.e., zero growth), DOE retained a constant efficiency difference or gap between 

the two cases over the length of the forecast period. Although frozen trends may not reflect what 

happens to base case and standards case product efficiencies in the future, DOE believes that 

maintaining a frozen efficiency difference between the base case and standards case provides a 

reasonable estimate of the impact that standards have on product efficiency. 

With the exception of cooktops and ovens, the NIA spreadsheet models for each of the 

considered products also incorporated user options of one percent and two percent for the growth 

rates of the base-case and standards-case forecasted efficiencies. The following sections detail 

the base-case and standards-case forecasted efficiencies that DOE developed for each of the four 

sets of products. 

11.2.1 Cooktops and Ovens 

DOE first presented the market share of efficiencies in the base case for cooktops and 

ovens in sections 8.2.6.1 and 8.2.6.2, respectively, of Chapter 8, LCC and PBP Analysis. As 

noted in Chapter 8, DOE did not have the data to develop efficiency distributions for any of the 

electric cooktop and oven product classes or the gas self-cleaning oven product class. Thus, 

DOE assumed that 100 percent of the current market was at the baseline level for these product 

classes. Because DOE assumed a roll-up scenario for forecasting product efficiency 

distributions once a standard became effective, the effect of any standard level was to move 100 

percent of the market to that standard level. 

In the case of gas cooktops and gas standard ovens, data were available to allow DOE to 

identify the percentage of the market in the base case that was already equipped with pilotless 

ignition. As described in Chapter 8, DOE allocated that percentage of the market that already 

had pilotless ignition. Therefore, knowing the market share of gas cooktops and standard ovens 

already equipped with pilotless ignition allowed DOE to accurately estimate the national impacts 

of requiring a standard that no longer allowed standing pilots. 

For the year 2012, Tables 11.2.1, 11.2.2, and 11.2.3 show the base case and standards 

case product efficiency distributions that DOE used in its national impact analysis for electric 

coil, electric smooth, and gas cooktops. The standards cases correspond to the candidate 

standard levels analyzed in the LCC and PBP Analysis. The TSLs for each product class are also 

shown in the following tables. Note that the TSLs do not consider all of the candidate standard 

levels that DOE analyzed in the LCC and PBP analysis. Also included in the tables below are the 

shipment-weighted efficiencies (SWEF) associated with the base case and each standards case 

(candidate standard level). 

11-3 

EERE-2006-STD-0127 COMMENT 64.2
Table 11.2.1 Electric Coil Cooktops: Base Case and Standards Case Efficiency 

Distributions in 2012 

Candidate Market Shares 

Standard 

Level TSL EF Base Case 

Candidate Standard Level 

1 

Baseline 1 0.737 100% -

1 2, 3, 4 0.769 0% 100% 

SWEF (EF) 0.737 0.769 

Table 11.2.2 Electric Smooth Cooktops: Base Case and Standards Case Efficiency 

Distributions in 2012 

Candidate Market Shares 

Standard 

Level TSL EF Base Case 

Candidate Standard Level 

1 

Baseline 1, 2, 3 0.742 100% -

1 4 0.753 0% 100% 

SWEF (EF) 0.742 0.753 

Table 11.2.3 Gas Cooktops: Base Case and Standards Case Efficiency Distributions in 

2012 

Candidate 

Standard Level TSL EF 

Market Shares 

Base Case 

Standard Case 

1 2 

Baseline - 0.156 6.8% - -

1 1, 2, 3 0.399 93.2% 100% -

2 4 0.420 0% 0% 100% 

SWEF (EF) 0.379 0.399 0.420 

Tables 11.2.4, 11.2.5, 11.2.6, and 11.2.7 show the base case and standards case product 

efficiency distributions in 2012 that DOE used for electric standard, electric self-cleaning, gas 

standard, and gas self-cleaning ovens. As with the cooktop product classes, the standards cases 

for the oven product classes correspond to the candidate standard levels analyzed in the LCC and 

PBP Analysis. The TSLs for each product class are also shown in the following tables. Note 

that the TSLs do not consider all of the candidate standard levels that DOE analyzed in the LCC 

and PBP analysis. Also included in each of the tables is the SWEF associated with the base case 

and each standards case. 

In the case of gas standard ovens (Table 11.2.6), DOE analyzed standard levels 1 and 1a 

in a similar manner. That is, because both are non-standing pilot ignition options, DOE allocated 

the market share at the baseline level (standing pilot) to the candidate standard level under 

consideration without affecting the market share allocated to the other standing pilot option. 

Therefore, when DOE analyzed candidate standard level 1 (glo-bar ignition system), the 17.6 

percent of the market at the baseline level was rolled-up into candidate standard level 1 (to arrive 

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EERE-2006-STD-0127 COMMENT 64.2
at a market share of 91.8 percent) without affecting the market share at candidate standard level 

1a (spark ignition). When DOE analyzed candidate standard level 1a, the 17.6 percent of the 

market at the baseline level was rolled-up into candidate standard level 1a (to arrive at a market 

share of 25.8 percent) without affecting the market share at candidate standard level 1. For 

candidate standard levels 2 through 6, because they included design options beyond a nonstanding pilot ignition system, the market shares at the baseline level and candidate standard 

levels 1 and 1a (for a total of 100 percent) were allocated to the candidate standard level under 

consideration. 

Table 11.2.4 Electric Standard Ovens: Base Case and Standards Case Efficiency 

Distributions in 2012 

Candidate Market Shares 

Standard 

Level TSL EF Base Case 

Candidate Standard Level 

1 2 3 4 5 

Baseline 1 0.1066 100% - - - - -

1 - 0.1113 0% 100% - - - -

2 2, 3 0.1163 0% 0% 100% - - -

3 - 0.1181 0% 0% 0% 100% - -

4 - 0.1206 0% 0% 0% 0% 100% -

5 4 0.1209 0% 0% 0% 0% 0% 100% 

SWEF (EF) 0.1066 0.1113 0.1163 0.1181 0.1206 0.1209 

Table 11.2.5 Electric Self-Cleaning Ovens: Base Case and Standards Case Efficiency 

Distributions in 2012 

Candidate Market Shares 

Standard 

Level TSL EF Base Case 

Candidate Standard Level 

1 2 

Baseline 1, 2, 3 0.1099 100% - -

1 - 0.1102 0% 100% -

2 4 0.1123 0% 0% 100% 

SWEF (EF) 0.1099 0.1102 0.1123 

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EERE-2006-STD-0127 COMMENT 64.2
Table 11.2.6 Gas Standard Ovens: Base Case and Standards Case Efficiency 

Distributions in 2012 

Candidate Market Shares 

Standard 

Level TSL EF 

Base 

Case 

Candidate Standard Level 

1 2 3 4 5 6 1a 

Baseline - 0.0298 17.6% - - - - - - -

1* - 0.0536 74.2% 91.8% - - - - - 74.2% 

2 - 0.0566 0% 0% 100% - - - - 0% 

3 - 0.0572 0% 0% 0% 100% - - - 0% 

4 - 0.0593 0% 0% 0% 0% 100% - - 0% 

5 - 0.0596 0% 0% 0% 0% 0% 100% - 0% 

6 4 0.0600 0% 0% 0% 0% 0% 0% 100% 0% 

1a* 1, 2, 3 0.0583 8.2% 8.2% 0% 0% 0% 0% 0% 25.8% 

SWEF (EF) 0.0498 0.0540 0.0566 0.0572 0.0593 0.0596 0.0600 0.0548 

* Candidate Standard Levels 1 and 1a correspond to designs that are utilized for the same purpose—eliminate the 

need for a standing pilot. Level 1 is a glo-bar hot surface ignition device while level 1a is a spark ignition device. 

Table 11.2.7 Gas Self-Cleaning Ovens: Base Case and Standards Case Efficiency 

Distributions in 2012 

Candidate Market Shares 

Standard 

Level TSL EF Base Case 

Candidate Standard Level 

1 2 3 

Baseline 1, 2 0.0540 100% - - -

1 3 0.0625 0% 100% - -

2 - 0.0627 0% 0% 100% -

3 4 0.0632 0% 0% 0% 100% 

SWEF (EF) 0.0540 0.0625 0.0627 0.0632 

For gas cooktops and gas standard ovens, DOE developed base case efficiency trends to 

estimate the future market share of products with pilotless ignition. As described in Chapter 8, 

only gas standard ranges (which are a combination of a gas cooktop and a gas standard oven) are 

still shipped with standing pilots. Based on the data first presented in sections 8.2.6.1 and 8.2.6.2 

of Chapter 8, Figure 11.2.2 shows the historical market share of gas cooking products with 

standing pilots. The figure below also provides trend lines to the historical data. Note that the 

market share of gas built-in ovens with standing pilots zeroed out in 1991 while the market share 

of gas built-in cooktops with standing pilots is zero out by the year 2000. That leaves standard 

ranges as the only gas cooking products shipped with standing pilots. By the end of the forecast 

period in the year 2042, DOE estimated that less than five percent of gas standard ranges in the 

market would still be shipped with standing pilots. DOE used the trend line for gas standard 

ranges presented below in Figure 11.2.2 to forecast the percentage of gas range shipments with 

standing pilots. Refer back to section 10.3.1.1 of Chapter 10, Shipments Analysis, for a 

description of how DOE allocated the gas standard range shipments into gas cooktop and gas 

standard oven product classes. 

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EERE-2006-STD-0127 COMMENT 64.2
0.0% 

5.0% 

10.0% 

15.0% 

20.0% 

25.0% 

30.0% 

35.0% 

40.0% 

45.0% 

50.0% 

1985 1995 2005 2015 2025 2035 2045 

Year 

Percent with Pilot 

Gas Standard Range 

Gas Built-In Cooktop 

Gas Built-In Oven 

Figure 11.2.1 Gas Cooking Products: Forecast of Products with Standing 

Pilots 

With regard to the base case and standards case forecasted efficiencies, as noted 

previously, DOE assumed that equipment efficiencies remain frozen at the levels in the year 

2012 for all standard levels and for all product classes, with the exception of gas cooktops and 

gas standard ovens. For gas cooktops and gas standard ovens, as noted above, DOE used the 

forecasted trend in gas ranges with standing pilots in the base case (as shown in Figure 11.2.2) to 

estimate the impacts from moving to a candidate standard level that eliminated standing pilots 

(i.e., candidate standard levels 1 and 1a). For all gas cooktop and gas standard oven candidate 

standard levels, DOE assumed that equipment efficiencies remain frozen at the levels in the year 

2012. 

11.2.2 Microwave Ovens 

DOE first presented the market share of efficiencies in the base case for microwave ovens 

in section 8.2.6.3 of Chapter 8, LCC and PBP Analysis. Table 11.2.8 shows the base case and 

standards case product efficiency distributions in the year 2012 that DOE used in its national 

impact analysis for microwave ovens. The standards cases correspond to the candidate standard 

levels analyzed in the LCC and PBP Analysis. The TSLs are also shown in Table 11.2.8. Note 

that DOE considered all the candidate standard levels in the TSLs that it developed for 

microwave ovens. 

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EERE-2006-STD-0127 COMMENT 64.2
Table 11.2.8 shows the resulting shipment-weighted efficiency for the energy factor for 

each standard level considered. 

Table 11.2.8 Microwave Ovens: Base Case and Standards Case Efficiency Distributions 

by Energy Factor Level in 2012 

Candidate 

Standard Level / 

Market Shares 

Candidate Standard Level 

TSL EF Base Case 1 2 3 4 

Baseline 0.557 100% - - - -

1 0.586 0% 100% - - -

2 0.588 0% 0% 100% - -

3 0.597 0% 0% 0% 100% -

4 0.602 0% 0% 0% 0% 100% 

SWEF (EF) 0.557 0.586 0.588 0.597 0.602 

Based on the assumption of a zero-percent growth rate in the forecasted efficiencies for 

the base case and all standards cases, DOE maintained the SWEFs shown above in Table 11.2.8 

throughout the entire forecast period, i.e., from 2012 to 2042. 

11.3 NATIONAL ENERGY SAVINGS 

11.3.1 NES Definition 

As shown in the following equation, DOE calculates annual national energy savings as 

the difference between two projections: a base case (without new standards) and a standards 

case (with new standards). Positive values of NES correspond to energy savings (i.e., national 

energy consumption with standards is less than national energy consumption in the base case). 

_ NESy = AEC BASE AEC STD 

Cumulative energy savings are the sum over the forecast period, extending from the 

assumed effective date, i.e., 2012, to 30 years after the effective date, i.e., 2042, of the annual 

national energy savings. This calculation is represented by the following equation: 

NEScum = ∑NES y 

DOE calculated the national annual energy consumption by multiplying the number or 

stock of the given product (by vintage) by its unit energy consumption (also by vintage). The 

calculation of the national annual energy consumption is represented by the following equation: 

11-8 

EERE-2006-STD-0127 COMMENT 64.2
AEC = ∑STOCKV ×UECV 

For the above expressions, DOE defined the various quantities as follows: 

AEC = Annual national energy consumption each year in quadrillion British 

thermal units (Btus) – or quads, summed over vintages of the product stock, 

STOCKV, 

NES = Annual national energy savings (quads), 

STOCKV = Stock of product (millions of units) of vintage V surviving in the year for 

which DOE calculated annual energy consumption (vintages range from five 

to approximately 28 years, depending on the retirement function of the 

product), 

UECV = Annual energy consumption per product in either kilowatt-hours (kWh) or 

million Btus (MMBtu) (electricity and gas consumption are converted from 

site energy to source energy (quads) by applying a time-dependent 

conversion factor), 

V = Year in which the product was purchased as a new unit, and 

y = Year in the forecast (i.e., 2012 to 2042). 

The stock of equipment is dependent on annual shipments and the lifetime of the 

equipment. As described in Chapter 10, DOE conducted shipments projections under the base 

case and standards cases. DOE determined that the shipments projections under the standards 

cases were slightly lower than those in the base case projection, due to the higher purchase prices 

of the more-efficient equipment. In other words, DOE believes that the higher purchase prices 

would cause some consumers to forego new equipment purchases. 

Due to the drop in shipments caused by standards, for microwave ovens, DOE used the 

standards case shipments projection and, in turn, the standards case stock, to calculate the annual 

energy consumption in the base case to avoid the inclusion of savings due to displaced 

shipments. In the case of electric and gas cooking products, because the housing market is fully 

saturated (i.e., all households have cooking appliances), DOE assumed that standards would 

neither impact shipments nor cause shifts in electric and gas cooking product market shares. 

Therefore, DOE’s projected standards case shipments for electric and gas cooking products were 

identical to its base case shipments. 

11.3.2 NES Inputs 

Table 11.3.1 lists the inputs for the determination of NES. 

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EERE-2006-STD-0127 COMMENT 64.2
Table 11.3.1 National Energy Saving Inputs 

Annual Energy Consumption per Unit (UEC) 

Shipments 

Equipment Stock (STOCKV) 

National Annual Energy Consumption (AEC) 

Site-to-Source Conversion Factor (src_conv) 

11.3.2.1 Annual Energy Consumption per Unit 

For each of the considered products, DOE presented the per-unit annual energy 

consumption as a function of product efficiency in both Chapter 6, Energy Use Determination, 

and section 8.2.2.1 of Chapter 8, LCC and PBP Analysis. Because the per-unit annual energy 

consumption is directly dependent on efficiency, DOE used the base case and standards case 

SWEFs presented above in section 10.2, in combination with the annual energy data presented in 

Chapters 6 and 8, to estimate the shipment-weighted average annual per-unit energy 

consumption under the base case and standards cases. The following sections describe the 

shipment-weighted average annual per-unit energy consumption for each of the considered 

products. 

Cooktops and Ovens 

DOE based its per-unit annual energy consumption of cooktops and ovens on data 

presented in section 8.2.2.1 of Chapter 8. Using the relationship between cooktop and oven EF 

and annual energy consumption described in Chapter 8, Tables 11.3.2 and 11.3.3 present the perunit annual energy consumption based on the SWEFs corresponding to the base case and each 

candidate standard level for each of the three product classes of cooktops and the four product 

classes of ovens. 

Table 11.3.2 Cooktops: Base Case and Standards Case Shipment-Weighted Average PerUnit Annual Energy Consumption in 2012 

Product Class Base Case 

Candidate Standard Level 

1 2 

Electric Coil SWEF (EF) 0.737 0.769 

Electric (kWh/yr) 128.2 122.9 

Electric Smooth SWEF (EF) 0.742 0.753 

Electric (kWh/yr) 128.2 126.3 

Gas SWEF (EF) 0.379 0.399 0.420 

Gas (MMBtu/yr) 0.83 0.72 0.68 

11-10 

EERE-2006-STD-0127 COMMENT 64.2
Table 11.3.3 Ovens: Base Case and Standards Case Shipment-Weighted Average PerUnit Annual Energy Consumption in 2012 

Product Class 

Base 

Case 

Candidate Standard Level 

1* 2 3 4 5 6 1a* 

Electric 

Standard 

SWEF (EF) 0.1066 0.1113 0.1163 0.1181 0.1206 0.1209 

Electric (kWh/yr) 166.5 160.1 153.9 151.8 149.0 148.6 

Electric SelfClean 

SWEF (EF) 0.1099 0.1102 0.1123 

Electric (kWh/yr) 171.0 170.6 167.9 

SWEF (EF) 0.0498 0.0540 0.0566 0.0572 0.0593 0.0596 0.0600 0.0548 

Gas Standard Electric (kWh/yr) 15.7 19.4 21.1 21.1 22.9 22.9 22.9 15.7 

Gas (MMBtu/yr) 1.02 0.84 0.80 0.79 0.75 0.75 0.74 0.84 

Gas Self-Clean 

SWEF (EF) 0.0540 0.0625 0.0627 0.0632 

Electric (kWh/yr) 53.33 55.13 55.13 55.13 

Gas (MMBtu/yr) 0.86 0.73 0.73 0.72 

* For gas standard ovens, levels 1 and 1a correspond to designs that are utilized for the same purpose—eliminate 

the need for a standing pilot—but the technologies for each design are different. Level 1 is a hot surface ignition 

device while level 1a is a spark ignition device. 

For all classes except gas cooktops and standard ovens, as noted above in section 11.2, 

DOE assumed that forecasted efficiencies in the base case and standards cases remain frozen at 

the efficiency levels in 2012. Therefore, because the per-unit annual energy consumption is a 

function of efficiency, DOE held the values shown above in Tables 11.3.2 and 11.3.3 constant 

over the forecast period (2012–2042). 

For gas cooktops and standard ovens, DOE tracked the percentage of gas standard ranges 

(which are composed of a cooktop and standard oven) with standing pilots. Because the 

percentage of ranges with standing pilots changes over time (as shown above in section 11.2, 

Figure 11.2.1), the base case annual energy consumption will change over time as well. Figure 

11.3.1 shows how the annual gas energy use for both base case gas cooktops and gas standard 

ovens decreases over time as more gas standard ranges are forecasted to be shipped with pilotless 

ignition. Also note in Figure 11.3.1 that, because standard ovens without standing pilots are 

assumed to use globar ignition devices that use a non-significant amount of electricity, the 

amount of electricity use for standard ovens increases over time. 

11-11 

EERE-2006-STD-0127 COMMENT 64.2
1.00 

0.85 

2010 2015 2020 2025 2030 2035 2040 2045 

Year 

(MMBtu) 

Cooktop - Gas Use 

Standard Oven - Gas Use 

Standard Oven - Elec Use 

19.0 

Base Case Gas Cooktop and Gas 

Standard Oven Annual Energy Use

0.95 18.5 

0.90 18.0 

17.5 

0.80 17.0 

0.75 16.5 

0.70 16.0 

Base Case Gas Standard Oven

Electrical Annual Energy Use (kWh)

Figure 11.3.1 Gas Cooktops and Gas Standard Ovens: Forecasted Base Case 

Annual Energy Consumption 

DOE assumed that forecasted efficiencies for gas cooktops and standard ovens in the 

standards cases remain frozen at the efficiency levels in 2012. Therefore, because the per-unit 

annual energy consumption is a function of efficiency, DOE held the gas cooktop and standard 

oven values shown above in Tables 11.3.2 and 11.3.3 constant over the forecast period (2012– 

2042) for all standards cases. 

Microwave Ovens 

DOE based its per-unit annual energy consumption of microwave ovens on data 

presented in section 8.2.2.1 of Chapter 8. Using the relationship between microwave oven EF 

and annual energy consumption described in Chapter 8, Table 11.3.4 presents the per-unit annual 

energy consumption based on the SWEFs corresponding to the base case and each TSL. 

Table 11.3.4 Microwave Ovens: Base Case and Standards Case Shipment-Weighted 

Average Per-Unit Annual Energy Consumption in 2012 

Base Trial Standard Level 

Case 1 2 3 4 

SWEF (EF) 0.557 0.586 0.588 0.597 0.602 

Annual Energy Use (kWh/yr) 155.6 149.1 148.7 146.8 145.8 

As noted above in section 11.2, DOE assumed that forecasted efficiencies in the base 

case and standards cases remain frozen at the efficiency levels in 2012. Therefore, because the 

11-12 

EERE-2006-STD-0127 COMMENT 64.2
per-unit annual energy consumption is a function of efficiency, DOE held the values shown 

above in Table 11.3.4 constant over the forecast period (2012–2042). 

11.3.2.2 Shipments 

DOE forecasted shipments for the base case and all standards cases. Several factors, 

including total installed costs (purchase price plus installation costs), operating cost, household 

income, and equipment lifetime, all impact forecasted shipments. Of the above factors, total 

installed cost was the primary driver in forecasting the impact of standards on shipments. As 

noted earlier, the increased total installed cost of more-efficient equipment causes some 

customers to forego equipment purchases. Consequently, shipments forecasted under the 

standards cases are lower than under the base case. An extensive description of the methodology 

for conducting and generating the shipments forecasts for each of the considered products can be 

found in Chapter 10, Shipments Analysis. 

11.3.2.3 Equipment Stock 

The equipment stock in a given year is the number of products shipped from earlier years 

that survive in the given year. The NIA Models keep track of the number of units shipped each 

year. DOE assumes that the products have an increasing probability of retiring as they age. The 

probability of survival as a function of years-since-purchase is the survival function. See the 

specific product sections in Chapter 10, Shipments Analysis, for further details on the survival 

functions that DOE used in its analysis. 

11.3.2.4 National Annual Energy Consumption 

The national annual energy consumption is the product of the annual energy consumption 

per unit and the number of units of each vintage. This approach accounts for differences in unit 

energy consumption from year to year. The equation for determining the annual energy 

consumption was shown above in section 11.3.1 and is repeated below. 

AEC = ∑STOCKV ×UECV 

In determining national annual energy consumption, DOE initially calculated the annual 

energy consumption at the site, and then applied a conversion factor to calculate primary energy 

consumption (see section 11.3.2.5). 

11.3.2.5 Energy Site-to-Source Conversion Factors 

In determining national annual energy consumption, DOE initially calculated the annual 

energy consumption at the site (e.g., for electricity, the energy in kWh consumed at the 

household or establishment). It then calculated primary (source) energy consumption from site 

energy consumption by applying a conversion factor to account for losses associated with the 

generation, transmission, and distribution of electricity and gas. The site-to-source conversion 

11-13 

EERE-2006-STD-0127 COMMENT 64.2
factor is the multiplicative factor used for converting site energy consumption into primary or 

source energy consumption, expressed in quads. DOE used annual site-to-source conversion 

factors based on the version of the National Energy Modeling System (NEMS) that corresponds 

to EIA’s Annual Energy Outlook 2008 (AEO2008). The factors used are marginal values, which 

represent the response of the system to an incremental decrease in consumption. Natural gas 

losses include pipeline leakage, pumping energy, and transportation fuel. The AEO2008 

forecasts losses of about seven percent for the natural gas used on site, with only slight variation 

from year to year. For electricity, the conversion factors vary over time, due to projected 

changes in generation sources (i.e., the power plant types projected to provide electricity to the 

country). DOE assumed that conversion factors remain constant at 2030 values throughout the 

remainder of the forecast. Table 11.3.5 shows the site-to-source conversion factors from 2005 to 

the end of the forecast period (2042). 

Table 11.3.5 Site-to-Source Conversion Factors for Electricity and Natural Gas 

Year 

Electricity 

Btu/kWh 

Natural Gas 

Btu/Btu Year 

Electricity 

Btu/kWh 

Natural Gas 

Btu/Btu 

2005 11500 1.097 2019 8300 1.087 

2006 11500 1.066 2020 8088 1.091 

2007 11200 1.086 2021 8088 1.093 

2008 10250 1.082 2022 7949 1.094 

2009 10000 1.084 2023 7200 1.094 

2010 10000 1.086 2024 6966 1.094 

2011 10000 1.086 2025 6500 1.095 

2012 10000 1.086 2026 6309 1.095 

2013 10000 1.086 2027 6309 1.095 

2014 10000 1.086 2028 6309 1.096 

2015 10000 1.086 2029 6309 1.096 

2016 10000 1.086 2030 6309 1.096 

2017 9700 1.086 2031–2042 6309 1.096 

2018 9000 1.087 

Source: NEMS, 2006. 

11.4 NET PRESENT VALUE 

11.4.1 NPV Definition 

The NPV is the value in the present of a time series of costs and savings. The NPV is 

described by the equation: 

_ NPV = PVS PVC 

11-14 

EERE-2006-STD-0127 COMMENT 64.2
where: 

PVS = Present value of operating cost savings (including energy, repair, and 

maintenance costs), and 

PVC = Present value of increased total installed costs (including equipment and 

installation). 

DOE determined the PVS and PVC according to the following expressions: 

PVS = ∑OCSy × DFy 

PVC = ∑TICy × DFy 

DOE calculated the total annual operating cost savings by multiplying the number or 

stock of the given product (by vintage) by its per-unit operating cost savings (also by vintage). 

DOE calculated the total annual installed cost increases by multiplying the number or stock of 

the given product (by vintage) by its per-unit total installed cost increase (also by vintage). The 

calculation of the annual operating costs savings and total annual installed cost increases is 

represented with the following equations: 

OCS y = ∑STOCKV ×UOCSV 

TIC y = ∑STOCKV ×UTICV 

For the above expressions, DOE defined the various quantities as follows: 

OCS = Total annual operating cost savings each year summed over vintages of the 

product stock, STOCKV, 

TIC = Total annual installed cost increases each year summed over vintages of the 

product stock, STOCKV, 

DF = Discount factor in each year, 

STOCKV = Stock of product (millions of units) of vintage V surviving in the year for 

which DOE calculated annual energy consumption (vintages range from five 

to approximately 28 years, depending on the retirement function of the 

product), 

UOCSV = Annual operating cost savings per unit, 

UTICV = Annual total installed cost increase per unit, 

V = Year in which the product was purchased as a new unit, and 

y = Year in the forecast (i.e., 2012 to 2042). 

DOE determined the PVC for each year, from the effective date of the standard to the 

year 2042. It determined the PVS for each year, from the effective date of the standard to the 

11-15 

EERE-2006-STD-0127 COMMENT 64.2
year when units purchased in 2042 retire. DOE calculated costs and savings as the difference 

between a standards case and a base case (i.e., without new standards). 

DOE calculated a discount factor from the discount rate and the number of years between 

the “present” (i.e., year to which the sum is being discounted) and the year in which the costs and 

savings occur. The NPV is the sum over time of the discounted net savings. 

11.4.2 NPV Inputs 

Table 11.4.1 summarizes the inputs to the NPV calculation. 

Table 11.4.1 Net Present Value Inputs 

Total Installed Cost per Unit 

Annual Operating Cost Savings per Unit 

Total Annual Installed Cost Increases 

Total Annual Operating Costs 

Discount Factor 

Present Value of Costs 

Present Value of Savings 

The increase in the total annual installed cost is equal to the annual change in the per-unit 

total installed cost (difference between base case and standards case) multiplied by the shipments 

forecasted in the standards case. As with the calculation of the NES, DOE did not calculate total 

annual installed costs for all of the products using base case shipments. Rather, in the case of 

dehumidifiers and microwave ovens, DOE used the standards case shipments projection and, in 

turn, the standards case stock, to calculate the costs to avoid the inclusion of savings due to 

displaced shipments. Electric and gas cooking products are the notable exception. For these 

products, because the market is fully saturated, DOE assumed that standards would neither 

impact shipments nor cause shifts in electric and gas cooking product market shares. Therefore, 

for electric and gas cooking products, DOE used the base case shipments to determine costs for 

all standards cases. 

The total annual operating cost savings are equal to the change in the annual operating 

costs (difference between base case and standards case) per unit multiplied by the shipments 

forecasted in the standards case. As noted above for the calculation of total annual installed 

costs, DOE did not necessarily calculate operating cost savings using the base case shipments. 

The annual operating cost includes energy, repair, and maintenance costs. 

11.4.2.1 Total Installed Cost per Unit 

For each of the considered products, DOE first presented the per-unit total installed cost 

as a function of product efficiency in section 8.2.1 of Chapter 8, LCC and PBP Analysis. 

Because the per-unit total annual installed cost is directly dependent on efficiency, DOE used the 

11-16 

EERE-2006-STD-0127 COMMENT 64.2
base case and standards case SWEFs presented above in section 11.2, in combination with the 

total installed costs presented in Chapter 8, to estimate the shipment-weighted average annual 

per-unit total installed cost under the base case and standards cases. The following sections 

describe the shipment-weighted average annual per-unit total installed cost for each of the 

considered products. 

Cooktops and Ovens 

DOE based its per-unit total installed cost of cooktops and ovens on data presented in 

sections 8.2.1.1 and 8.2.1.2 of Chapter 8. The total installed cost includes both the equipment 

price and the installation cost. For gas cooktops and standard ovens, the installation cost for 

standard levels beyond the baseline level accounts for consumers that need to install an electrical 

outlet to accommodate a cooking product that now requires electricity to operate. Details on the 

determination of this added installation costs and the percentage of consumers that are estimated 

to need an outlet are provided in sections 8.2.1.1 for gas cooktops and 8.2.1.2 for gas standard 

ovens. DOE based average equipment prices on average manufacturer costs multiplied by 

average overall markup values. Using the relationship between cooktop and oven EF and total 

installed cost presented in Chapter 8, Tables 11.4.2 and 11.4.3 show the per-unit total installed 

cost for cooktops and ovens, respectively, based on the SWEFs corresponding to the base case 

and each candidate standard level. 

Table 11.4.2 Cooktops: Base Case and Standards Case Shipment-Weighted Average PerUnit Total Installed Costs in 2012 

Product Candidate Standard Level 

Class Base Case 1 2 

Electric Coil SWEF (EF) 0.737 0.769 

Total Installed Cost (2006$) $272 $276 

Electric 

Smooth 

SWEF (EF) 0.742 0.753 

Total Installed Cost (2006$) $309 $550 

Gas SWEF (EF) 0.379 0.399 0.420 

Total Installed Cost (2006$) $385 $391 $420 

11-17 

EERE-2006-STD-0127 COMMENT 64.2
Table 11.4.3 Ovens: Base Case and Standards Case Shipment-Weighted Average PerUnit Total Installed Costs in 2012 

Product 

Class 

Base 

Case 

Candidate Standard Level 

1* 2 3 4 5 6 1a* 

Electric 

Standard 

Electric 

Self-Clean 

SWEF (EF) 

Total Installed Cost 

(2006$) 

SWEF (EF) 

0.1066 

$414 

0.1099 

0.1113 

$416 

0.1102 

0.1163 

$421 

0.1123 

0.1181 

$426 

0.1206 

$484 

0.1209 

$489 

Total Installed Cost 

(2006$) $485 $491 $548 

Gas 

Standard 

SWEF (EF) 0.0498 0.0540 0.0566 0.0572 0.0593 0.0596 0.0600 0.0548 

Total Installed Cost 

(2006$) $500 $515 $520 $522 $554 $556 $562 $516 

Gas SelfClean 

SWEF (EF) 0.0540 0.0625 0.0627 0.0632 

(2006$) 

Total Installed Cost $550 $566 $573 $574 

* For gas standard ovens, levels 1 and 1a correspond to designs that are utilized for the same purpose—eliminate 

the need for a standing pilot—but the technologies for each design are different. Level 1 is a hot surface ignition 

device while level 1a is a spark ignition device. 

For all classes except gas cooktops and standard ovens, as noted above in section 11.2, 

DOE assumed that forecasted efficiencies in the base case and candidate standard levels remain 

frozen at the efficiency levels in 2012. Therefore, because the per-unit total installed cost is a 

function of efficiency, DOE held the values shown above in Tables 11.4.4 and 11.4.5 constant 

over the forecast period (2012–2042). 

For gas cooktops and standard ovens, DOE tracked the percentage of gas standard ranges 

(which are composed of a cooktop and standard oven) with standing pilots. Because the 

percentage of ranges with standing pilots changes over time (as shown above in section 11.2, 

Figure 11.2.1), the base case total installed cost will change over time as well. Figure 11.4.1 

shows how the total installed cost for both base case gas cooktops and gas standard ovens 

increases over time as more gas standard ranges are forecasted to be shipped with pilotless 

ignition. 

11-18 

EERE-2006-STD-0127 COMMENT 64.2
$326.0 

$326.5 

$327.0 

$327.5 

$328.0 

$328.5 

2010 2015 2020 2025 2030 2035 2040 2045 

Year 

Base Case Gas Cooktop

Total Installed Cost (2006$) 

$445.5 

$446.0 

$446.5 

$447.0 

$447.5 

$448.0 

Base Case Gas Standard Oven

Total Installed Cost (2006$) 

Cooktop 

Standard Oven 

Figure 11.4.1 Gas Cooktops and Gas Standard Ovens: Forecasted Base Case 

Total Installed Costs 

DOE assumed that forecasted efficiencies for gas cooktops and standard ovens in the 

standards cases remain frozen at the efficiency levels in 2012. Therefore, because the per-unit 

total installed cost is a function of efficiency, DOE held the gas cooktop and standard oven 

values shown above in Tables 11.4.2 and 11.4.3 constant over the forecast period (2012–2042) 

for all candidate standard levels. 

Microwave Ovens 

DOE based its per-unit total installed cost of microwave ovens on data presented in 

section 8.2.1.3 of Chapter 8. For microwave ovens, the total installed cost includes only the 

equipment price, since the installation cost for these products is zero. DOE based average 

equipment prices on average manufacturer costs multiplied by average overall markup values. 

Using the relationship between microwave oven EF and total installed cost presented in Chapter 

8, Table 11.4.4 shows the per-unit total installed cost for microwave ovens based on the SWEFs 

corresponding to the base case and each TSL. 

11-19 

EERE-2006-STD-0127 COMMENT 64.2
Table 11.4.4 Microwave Ovens: Base Case and Standards Case Shipment-Weighted 

Average Per-Unit Total Installed Costs in 2012 

Base 

Case 

Trial Standard Level 

1 2 3 4 

SWEF (EF) 0.557 0.586 0.588 0.597 0.602 

Total Installed Cost (2006$) $220 $232 $246 $26 $294 

As noted above in section 11.2, DOE assumed that forecasted efficiencies in the base 

case and TSLs remain frozen at the efficiency levels in 2012. Therefore, because the per-unit 

total installed costs are a function of efficiency, DOE held the values shown above in Table 

11.4.4 constant over the forecast period (2012–2042). 

11.4.2.2 Annual Operating Cost Savings per Unit 

The per-unit annual operating cost includes the energy, repair, and maintenance costs. 

Annual Energy Costs 

DOE determined the per-unit annual energy cost savings by taking the per-unit annual 

energy consumption savings developed for each product and multiplying it by the appropriate 

energy price. 

For all of the considered products, estimates of the per-unit annual energy consumption 

for the base case and each standards case were presented earlier in section 11.3.2.1. As 

described previously, DOE forecasted the per-unit annual energy consumption for the base case 

and each standards case for all products by freezing the consumption at levels estimated for the 

year 2012.a 

Energy prices are described in section 8.2.2.2 of Chapter 8. DOE forecasted energy 

prices based on EIA’s AEO2009 Early Release.

2

 The energy price trends are described in 

section 8.2.2.3 of Chapter 8. 

Annual Repair and Maintenance Costs 

As described in section 8.2.2.4 of Chapter 8, DOE estimated increased repair and 

maintenance costs for gas cooktops and gas standard ovens. DOE assumed no increase in repair 

and maintenance costs due to standards for all electric cooking products (including microwave 

ovens), and gas self-cleaning ovens. 

For gas cooktops and gas standard ovens, DOE determined the repair and maintenance 

costs for the three types of ignition systems considered for these products: standing pilot 

(baseline level), electric glo-bar ignition (candidate standard level 1 for standard gas ovens), and 

electronic spark ignition (candidate standard level 1 for gas cooktops and candidate standard 

a

 The one exception pertains to the base case per-unit annual energy consumption of gas cooktops and gas standard 

ovens. 

11-20 

EERE-2006-STD-0127 COMMENT 64.2
level 1a for gas standard ovens). For standing pilot ignition systems, DOE determined that repair 

and maintenance are needed once every 10 years to clean valves. For electric glo-bar/hot surface 

ignition systems, the glo-bar requires replacement approximately every five years. In the case of 

electronic ignition systems, control modules tend to last 10 years. The electrodes/igniters can 

fail due to hard contact from pots or pans, although failures are rare. As defined in section 

11.4.1, for the calculation of annual operating cost savings, DOE kept track of the vintage of 

products entering the stock. Therefore, DOE was able to properly account for when gas 

cooktops and gas standard ovens incurred costs for the repair and maintenance of ignition 

systems. 

As noted above in section 11.2, DOE assumed that forecasted efficiencies in the base 

case and TSLs remain frozen at the efficiency levels in 2012. Therefore, because the per-unit 

total installed costs are a function of efficiency, DOE held the values shown above in Tables 

11.4.7 and 11.4.8 constant over the forecast period (2012–2042). 

11.4.2.3 Total Annual Installed Cost Increases 

The total annual installed cost increase for any given standards case is the product of the 

total installed cost increase per unit due to the standard and the number of units of each vintage. 

This approach accounts for differences in total installed cost from year to year. The equation for 

determining the total annual installed cost increase for a given standards case was shown in 

section 11.4.1 and is repeated below. 

TIC = ∑STOCKV ×UTICV 

11.4.2.4 Total Annual Operating Cost Savings 

The total annual operating cost savings for any given standards case is the product of the 

annual operating cost savings per unit due to the standard and the number of units of each 

vintage. This approach accounts for differences in annual operating cost savings from year to 

year. The equation for determining the total annual operating cost savings for a given standards 

case was shown above and is repeated below. 

OCS = ∑STOCKV ×UOCSV 

11.4.2.5 Discount Factors 

DOE multiplies monetary values in future years by a discount factor to determine the 

present value. The discount factor (DF) is described by the equation: 

1

DF = _

(1+ r )( y yp ) 

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EERE-2006-STD-0127 COMMENT 64.2
where: 

r = discount rate, 

y = year of the monetary value, and 

yP = year in which the present value is being determined. 

DOE estimated national impacts with both a three-percent and a seven-percent real 

discount rate as the average real rate of return on private investment in the U.S. economy. It 

used these discount rates in accordance with the Office of Management and Budget (OMB)’s 

guidance to Federal agencies on the development of regulatory analysis (OMB Circular A-4, 

September 17, 2003), and section E., “Identifying and Measuring Benefits and Costs,” therein. 

DOE defines the present year as 2007. 

11.4.2.6 Present Value of Costs 

The present value of increased installed costs is the annual installed cost increase in each 

year (i.e., the difference between the standards case and base case), discounted to the present, 

and summed for the time period over which DOE is considering the installation of equipment 

(i.e., from the effective date of standards, 2012, to the year 2042). 

The increase in total installed cost refers to both equipment cost and installation cost 

associated with the higher energy efficiency of equipment purchased in the standards case 

compared to the base case. DOE calculated annual increases in installed costs as the difference 

in total installed cost for new equipment purchased each year, multiplied by the shipments in the 

standards case. 

11.4.2.7 Present Value of Savings 

The present value of operating cost savings is the annual operating cost savings (i.e., the 

difference between the base case and standards case) discounted to the present, and summed over 

the period from the effective date, 2012, to the time when the last unit installed in 2042 is retired 

from service. 

Savings are decreases in operating costs (including electricity, repair, and maintenance 

costs) associated with the higher energy efficiency of equipment purchased in the standards case 

compared to the base case. Total annual operating cost savings are the savings per unit 

multiplied by the number of units of each vintage surviving in a particular year. Equipment 

consumes energy over its entire lifetime, and for units purchased in 2042, the consumption 

includes energy consumed until the unit is retired from service. 

11.4.3 Fuel Switching 

Fuel switching describes the occurrence of consumers switching from a product that 

consumes one type of fuel to another product that provides the same utility and service but 

11-22 

EERE-2006-STD-0127 COMMENT 64.2
consumes a different fuel. Fuel switching is caused when the purchase price or operating cost of 

a product is so high that it causes the consumer to alter their purchase decision and buy the like 

product that operates off the alternative fuel. 

As described in Chapter 8, sections 8.2.1.1 and 8.2.1.2, some gas cooktop and gas 

standard oven consumers that use products with standing pilot ignition devices would need to 

install an electrical outlet to accommodate a product that would require electricity to operate. As 

detailed in Chapter 8, DOE estimated an installation cost of $235 to install an electrical outlet for 

a gas cooking product that needed electricity to operate. Because the added installation cost is 

high, DOE needed to assess whether those gas product consumers that would need to install an 

outlet would change their purchase decision and acquire an electric cooking product. 

If a consumer were to switch from a gas cooking product to an electrical appliance due to 

the prospect of this installation cost, an outlet would still be needed to accommodate the 

electrical appliance. Based on the RS Means Mechanical Cost Data, 2008,

3

 the cost of installing 

only an outlet suitable for an electrical cooking appliance, which requires a 50-amp, 240-volt 

receptacle, is $305 (see Table 11.4.5). 

Table 11.4.5 Installation Cost for an Electrical Outlet to accommodate an Electric 

Cooking Product 

Indiv. 

Line # Description Crew 

Daily 

Output 

PersonHours Unit Mat. Labor Equip. Total 

Total 

incl. 

O&P 

2008 Mechanical Cost Data: 2008 Base Costs 

4730 

Range Outlet, 50 amp240 volt recpt. 30' of 

#8/3, EMT & wire 1 Elect 2.96 2.703 Ea. $111 $123 $0 $234 $305 

Average (2006$)* $305 

Total Installation Cost (2006$) $305.00 

* Cost in 2008$ assumed to be representative of 2006$. 

Sources: Bare Costs: RS Means, Mechanical Cost Data, 2008. 

Due to the amperage and voltage requirements of the receptacle as well as the age of the 

household in which the outlet would be installed (pre-1960), a separate branch circuit coming off 

the fuse box or circuit breaker panel would be necessary to accommodate the electrical cooking 

appliance. Also, because of the additional amperage required by the electrical cooking 

appliance, it is highly likely that the fuse box or circuit breaker panel would need to be upgraded. 

Based on material costs from the Craftsman 2008 National Home Improvement Estimator4

 and 

2008 National Repair & Remodeling Estimator5 and labor costs from the RS Means, Mechanical 

Cost Data, 2008,

2

 DOE estimated an installation cost of $1247 for installing a branch circuit and 

upgrading a breaker panel from 50 amps to 100 amps (see Table 11.4.6). Combined with the 

$305 installation cost of the receptacle, the total installation cost to accommodate an electrical 

cooking appliance is estimated to be $1562 or over six times the cost of installing a standard 

120-volt outlet for a gas cooking product. Therefore, there is no financial incentive for a 

consumer to switch from gas cooking to electric cooking. Thus, DOE believes the probability of 

11-23 

EERE-2006-STD-0127 COMMENT 64.2
fuel switching is so low that DOE is not considering it in the national impact analysis of 

cooktops and ovens. Fuel switching was not considered for microwave ovens. 

Table 11.4.6 Installation Cost for a Branch Circuit to accommodate an Electric Cooking 

Product 

Description 

2008 Bare Costs Calculated Values 

Qty Crew 

Labor 

Hours Unit Mat. 

Labor 

(given) Equip. 

Total 

(given) 

Labor 

Hours 

(Calc.) 

Mat. 

(incl. 

10% 

Profit) 

Labor 

(incl 

O&P) Equip 

Total 

incl. 

O&P 

Fishing electrical cable through a stud wall (assume 2 foot wired per stud walls)* 

Job Setup 1 1 Elec 0.270 Ea. $0 $12 $0 $12 0.270 $0 $18 $0 $18.32 

per foot of cable fished 20 1 Elec 0.050 LF $0 $2 $0 $2 1.000 $0 $68 $0 $67.87 

per electrical box set 1 1 Elec. 0.761 Ea. $0 $35 $0 $35 0.761 $0 $52 $0 $51.65 

per stud notched and 

hole patched 10 1 Elec 0.400 Per Stud $0 $18 $0 $18 4.000 $0 $271 $0 $271.48 

Branch Circuit Installation 

Panel (100 AMP 

service - 12-circuit, 

Installation) ** 

1 1 Elec 1.600 Ea. $160 $73 $0 $233 1.600 $176 $109 $0 $284.59 

Disconnect and 

remove distribution 

panel (50-100 Amps, 

Frame Wall) *** 

1 1 Elec. 0.220 Ea. $0 $10 $0 $10 0.220 $0 $15 $0 $14.93 

Per Circuit 

Disconnect *** 10 1 Elec. 0.063 Per 

Circuit $0 $3 $0 $3 0.630 $0 $43 $0 $42.76 

Ground-fault 

interrupter plug-on 

circuit breaker, QOGFI Qwik-Gard®, 

Square D® (50 AMP, 

2 Pole) *** 

1 1 Elec. 0.150 $163 $7 $0 $170 0.150 $179 $10 $0 $189.48 

Grounding rod with 

clamp (100 AMP 

Service Installation) ** 

1 1 Elec 2.670 Ea. $16.50 $122 0 $138 2.670 $18 $181 $0 $199.36 

Ground Cable 

(typcical Allowance is 

10 LF) ** 

10 1 Elec. 0.080 LF $0.18 $4 $0 $4 0.800 $2 $54 $0 $56.28 

Electrical Permit 

Charge ** 1 1 Elec 0.000 CLF $0.00 $0 0 $0 0.000 $0 $0 $0 $50.00 

Total Installation Cost (2006$)† $1246.72 

* Sources – Labor Hours and Material Costs: Craftsman, National Home Improvement Estimator, 2008; Labor Costs and Overhead & 

Profit (O&P) Multiplier: RS Means, Mechanical Cost Data, 2008. 

** Sources – Labor Hours and Material Costs: Craftsman, Repair and Remodel Estimator, 2008; Labor Costs and Overhead & Profit 

(O&P) Multiplier: RS Means, Mechanical Cost Data, 2008.

*** Sources – Labor Hours and Material Costs: Craftsman, Home Improvement, 2008; Labor Costs and Overhead & Profit (O&P) 

Multiplier: RS Means, Mechanical Cost Data, 2008.

† Cost in 2008$ assumed to be representative of 2006$. 

11-24 

EERE-2006-STD-0127 COMMENT 64.2
11.5 NES AND NPV RESULTS 

The NIA Model provides estimates of the NES and NPV due to various candidate 

standards levels. The inputs to the NIA Model have been discussed earlier in sections 11.3.2 

(NES Inputs) and 11.4.2 (NPV Inputs). DOE generated the NES and NPV results using a 

Microsoft Excel® spreadsheet, which is accessible on the Internet 

(http://www.eere.energy.gov/buildings/appliance_standards/). Details and instructions for using 

the spreadsheet are provided in Appendix 11A. 

11.5.1 NES and NPV Input Summary 

Table 11.5.1 summarizes the inputs to the NIA Model. For each input a brief description 

of the data source is given. 

Table 11.5.1 NES and NPV Inputs 

Input Data Description 

Shipments Annual shipments from Shipments Model. (See Chapter 10.) 

Effective Date of Standard 2012. 

Base Case Forecasted Efficiencies SWEF determined in the year 2005 for each of the considered 

products. SWEF held constant over forecast period of 2005–2042. 

(See Section 11.2.) 

Standards Case Efficiencies Roll-up scenario assumed for determining SWEF in the year 2012 for 

each standards case and for each of the considered products. SWEF 

held constant over forecast period of 2012–2042. (See Section 11.2.) 

Annual Energy Consumption per Unit Annual weighted-average values are a function of SWEF. (See 

Section 11.3.2.1.) 

Total Installed Cost per Unit Annual weighted-average values are a function of SWEF. (See 

Section 11.4.2.1.) 

Energy Cost per Unit Annual weighted-average values are a function of the annual energy 

consumption per unit and energy prices. (See Section 8.2.2.3 of 

Chapter 8 for energy prices.) 

Repair Cost and Maintenance Cost per Unit For gas cooktops and gas standard ovens, repair and maintenance 

costs specified for different types of ignition systems. For all electric 

cooking products, including microwave ovens, and gas self-cleaning 

ovens, no changes in repair and maintenance cost assumed due to 

standards. (See Section 8.2.2.4 of Chapter 8 for repair and 

maintenance costs.) 

Escalation of Energy Prices Energy Prices: EIA AEO2008 forecasts (to 2030) and extrapolation to 

2042. (See Section 8.2.2.3 of Chapter 8.) 

Energy Site-to-Source Conversion Conversion varies yearly and is generated by DOE/EIA’s NEMS* 

program (a time series conversion factor; includes electric generation, 

transmission, and distribution losses). 

Discount Rate 3 percent and 7 percent real. 

Present Year Future expenses are discounted to year 2007. 

* Chapter 14 on the Utility Impact Analysis and the Environmental Assessment Report provide more detail on NEMS. 

11-25 

EERE-2006-STD-0127 COMMENT 64.2
11.5.2 NES Results 

The following sections provide NES results for the TSLs analyzed for the considered 

products. NES results are cumulative to 2042 and are shown as primary energy savings. NWS 

results are expressed in billions of gallons. DOE based the inputs to the NIA Model on 

weighted-average values, yielding results that are discrete point values, rather than a distribution 

of values as in the LCC and PBP Analysis. 

11.5.2.1 Cooktops and Ovens 

This section provides NES results for the efficiency levels considered for the three 

product classes of cooktops and the four product classes of ovens. Tables 11.5.2 and 11.5.3 

show the NES results for the candidate standard levels and TSLs analyzed for cooktops and 

ovens, respectively. 

Table 11.5.2 Cooktops: Cumulative NES Results 

CSL 

Electric Coil Electric Smooth Gas 

TSL EF 

NES 

quads TSL EF 

NES 

quads TSL EF 

NES 

Quads 

Baseline 1 0.737 - 1, 2, 3 0.742 - - 0.156 -

1 2, 3, 4 0.769 0.04 4 0.753 0.02 1, 2, 3 0.399 0.10 

2 4 0.420 0.15 

Table 11.5.3 Ovens: Cumulative NES Results 

CSL 

Electric Standard Electric Self-Clean Gas Standard Gas Self-Clean 

TSL EF 

NES 

quads TSL EF 

NES 

quads TSL EF 

NES 

quads TSL EF 

NES 

quads 

Base 1 0.1066 - 1, 2, 3 0.1099 - - 0.0298 - 1, 2 0.0540 -

1* - 0.1113 0.03 - 0.1102 0.01 - 0.0536 0.04 3 0.0625 0.09 

2 2, 3 0.1163 0.05 4 0.1123 0.04 - 0.0566 0.06 - 0.0627 0.09 

3 - 0.1181 0.06 - 0.0572 0.07 4 0.0632 0.10 

4 - 0.1206 0.07 - 0.0593 0.08 

5 4 0.1209 0.07 - 0.0596 0.09 

6 4 0.0600 0.09 

1a* 1, 2, 3 0.0583 0.05 

* For gas standard ovens, candidate standard levels 1 and 1a correspond to designs that are utilized for the same 

purpose—eliminate the need for a standing pilot—but the technologies for each design are different. Candidate 

standard level 1 is a hot surface ignition device while level 1a is a spark ignition device. Candidate standard level 1a 

is presented at the end of the table because levels 2 through 6 are derived from level 1. 

Tables 11.5.4 and 11.5.5 show the magnitude of the NES if the savings are discounted at 

rates of seven percent and three percent for cooktops and ovens, respectively. 

11-26 

EERE-2006-STD-0127 COMMENT 64.2
Table 11.5.4 Cooktops: Cumulative NES Results Discounted at Seven Percent and Three 

Percent 

Electric Coil Electric Smooth Gas 

NES (quads) NES (quads) NES (quads) 

CSL TSL EF 

7% 

disc. 

3% 

disc. TSL EF 

7% 

disc. 

3% 

disc. TSL EF 

7% 

disc. 

3% 

disc. 

Base 1 0.737 - - 1, 2, 3 0.742 - - - 0.156 - -

1 2, 3, 4 0.769 0.01 0.02 4 0.753 0.00 0.01 1, 2, 3 0.399 0.03 0.05 

2 4 0.420 0.04 0.08 

Table 11.5.5 Ovens: Cumulative NES Results Discounted at Seven Percent and Three 

Percent 

Electric Standard Electric Self-Clean Gas Standard Gas Self-Clean 

NES (quads) NES (quads) NES (quads) NES (quads) 

CSL TSL EF 

7% 

disc. 

3% 

disc. TSL EF 

7% 

disc. 

3% 

disc. TSL EF 

7% 

disc. 

3% 

disc. TSL EF 

7% 

disc. 

3% 

disc. 

Base 1 0.1066 - - 1,2,3 0.1099 - - - 0.0298 - - 1,2 0.0540 - -

1* - 0.1113 0.01 0.01 - 0.1102 0.00 0.00 - 0.0536 0.01 0.02 3 0.0625 0.02 0.04 

2 2, 3 0.1163 0.01 0.03 4 0.1123 0.01 0.02 - 0.0566 0.02 0.03 - 0.0627 0.02 0.05 

3 - 0.1181 0.01 0.03 - 0.0572 0.02 0.04 4 0.0632 0.02 0.05 

4 - 0.1206 0.02 0.04 - 0.0593 0.02 0.04 

5 4 0.1209 0.02 0.04 - 0.0596 0.02 0.04 

6 4 0.0600 0.02 0.05 

1a* 1,2,3 0.0583 0.01 0.03 

* For gas standard ovens, candidate standard levels 1 and 1a correspond to designs that are utilized for the same 

purpose—eliminate the need for a standing pilot—but the technologies for each design are different. Candidate 

standard level 1 is a hot surface ignition device while level 1a is a spark ignition device. Candidate standard level 1a 

is presented at the end of the table because levels 2 through 6 are derived from level 1. 

11.5.2.2 Microwave Ovens 

This section provides NES results for the efficiency levels considered for microwave 

ovens. Table 11.5.6 shows the NES results for the TSLs analyzed for microwave ovens. 

Table 11.5.6 Microwave Ovens: Cumulative NES Results 

TSL EF 

NES 

Quads 

1 0.586 0.08 

2 0.588 0.09 

3 0.597 0.11 

4 0.602 0.12 

11-27 

EERE-2006-STD-0127 COMMENT 64.2
Table 11.5.7 shows the magnitude of the NES if the savings are discounted at rates of 

seven percent and three percent. 

Table 11.5.7 Microwave Ovens: Cumulative NES Results Discounted at Seven Percent 

and Three Percent 

TSL EF 

NES (quads) 

7% discounted 3% discounted 

1 0.586 0.02 0.05 

2 0.588 0.02 0.05 

3 0.597 0.03 0.06 

4 0.602 0.03 0.07 

11.5.3 Annual Costs and Savings 

To illustrate the basic inputs to the NPV calculations, Figure 11.5.1 presents the nondiscounted annual installed cost increases and annual operating cost savings at the national level 

for TSL 3b for microwave ovens. The figure also shows the net savings, which is the difference 

between the savings and costs for each year. The annual equipment cost is the increase in the 

total installed cost for products purchased each year over the period 2012–2042. The annual 

operating cost savings is the savings in operating costs for products operating in each year. The 

NPV is the difference between the cumulative annual discounted savings and the cumulative 

annual discounted costs. DOE could create figures like the one shown below for each of the 

considered products’ standard cases. 

11-28 

EERE-2006-STD-0127 COMMENT 64.2
-1.50 

-1.30 

-1.10 

-0.90 

-0.70 

-0.50 

-0.30 

-0.10 

0.10 

0.30 

2012 2017 2022 2027 2032 2037 2042 2047 2052 

Year 

Billion of 2006 Dollars 

Equipment Cost 

Operating Cost Savings 

Net Savings 

Figure 11.5.1 Non-Discounted Annual Installed Cost Increases and Annual 

Operating Cost Savings for Microwave Ovens, TSL 3 

11.5.4 NPV Results 

The following sections provide NPV results for the candidate standards levels considered 

for the product classes of each considered product. Results are cumulative and are shown as the 

discounted value of these savings in dollar terms. DOE based the inputs to the NIA Model on 

weighted-average values, yielding results that are discrete point values, rather than a distribution 

of values as in the LCC and PBP Analysis. 

The present value of increased total installed costs is the total annual installed cost 

increase (i.e., the difference between the standards case and base case), discounted to the present, 

and summed over the time period in which DOE evaluates the impact of standards (i.e., from the 

effective date of standards, 2012, to the year 2042). 

Savings are decreases in operating costs (including energy) associated with the higher 

energy efficiency of equipment purchased in the standards case compared to the base case. Total 

operating cost savings are the savings per unit multiplied by the number of units of each vintage 

(i.e., the year of manufacture) surviving in a particular year. Equipment consumes energy and 

must be maintained over its entire lifetime. For units purchased up through 2042, the operating 

cost includes energy consumed until the last unit is retired from service. 

11-29 

EERE-2006-STD-0127 COMMENT 64.2
11.5.4.1 Cooktops and Ovens 

This section provides NPV results based on discount rates of seven percent and three 

percent for the standard levels considered for cooktops and ovens. Tables 11.5.8 and 11.5.9 

show the NPV results for the candidate standard levels analyzed for cooktops and ovens, 

respectively. Under the base case (i.e., without standards), the cumulative national equipment 

and operating costs of cooking products based on a seven-percent discount rate equal $61.7 

billion and $56.6 billion, respectively. Based on a three-percent discount rate, the cumulative 

national equipment and operating costs equal $118.0 billion and $122.3 billion, respectively. 

Detailed results showing the breakdown of the NPV into national equipment costs and national 

operating costs are provided in Appendix 11B. 

Table 11.5.8 Cooktops: Cumulative NPV Results based on Seven-Percent and ThreePercent Discount Rates 

Electric Coil Electric Smooth Gas 

NPV NPV NPV NPV NPV NPV 

CSL TSL EF 

@ 7% 

billion 

2006$ 

@ 3% 

billion 

2006$ TSL EF 

@ 7% 

billion 

2006$ 

@ 3% 

billion 

2006$ TSL EF 

@ 7% 

billion 

2006$ 

@ 3% 

billion 

2006$ 

Base 1 0.737 - - 1, 2, 3 0.742 - - - 0.156 - -

1 2, 3, 4 0.769 0.07 0.23 4 0.753 -7.26 -13.89 1, 2, 3 0.399 0.19 0.50 

2 4 0.420 -0.73 -1.11 

Table 11.5.9 Ovens: Cumulative NPV Results based on Seven-Percent and Three-Percent 

Discount Rates 

CSL 

Electric Standard Electric Self-Clean Gas Standard Gas Self-Clean 

TSL EF 

NPV 

@ 7% 

billion 

2006$ 

NPV 

@ 3% 

billion 

2006$ TSL EF 

NPV 

@ 7% 

billion 

2006$ 

NPV 

@ 3% 

billion 

2006$ TSL EF 

NPV 

@ 7% 

billion 

2006$ 

NPV 

@ 3% 

billion 

2006$ TSL EF 

NPV 

@ 7% 

billion 

2006$ 

NPV 

@ 3% 

billion 

2006$ 

Base 1 0.1066 - - 1,2,3 0.1099 - - - 0.0298 - - 1,2 0.0540 - -

1* - 0.1113 0.07 0.21 - 0.1102 -0.27 -0.50 - 0.0536 -0.18 -0.34 3 0.0625 -0.01 0.19 

2 2, 3 0.1163 0.11 0.34 4 0.1123 -2.77 -5.21 - 0.0566 -0.38 -0.81 - 0.0627 -0.12 -0.01 

3 - 0.1181 0.06 0.28 ­ 0.0572 -0.38 -0.81 4 0.0632 -0.14 -0.04 

4 - 0.1206 -0.74 -1.24 ­ 0.0593 -0.82 -1.60 

5 4 0.1209 -0.81 -1.37 ­ 0.0596 -0.84 -1.64 

6 4 0.0600 -0.91 -1.76 

1a* 1,2,3 0.0583 0.02 0.11 

* For gas standard ovens, candidate standard levels 1 and 1a correspond to designs that are utilized for the same 

purpose—eliminate the need for a standing pilot—but the technologies for each design are different. Candidate 

standard level 1 is a hot surface ignition device while level 1a is a spark ignition device. Candidate standard level 1a 

is presented at the end of the table because levels 2 through 6 are derived from level 1. 

11-30 

EERE-2006-STD-0127 COMMENT 64.2
11.5.4.2 Microwave Ovens 

This section provides NPV results based on discount rates of seven percent and three 

percent for the standard levels considered for microwave ovens. Table 11.5.10 shows the NPV 

results for the trial standard levels analyzed for microwave ovens. Under the base case (i.e., 

without standards), the cumulative national equipment and operating costs of microwave ovens 

based on a seven-percent discount rate equal $36.4 billion and $22.9 billion, respectively. Based 

on a three-percent discount rate, the cumulative national equipment and operating costs equal 

$69.6 billion and $46.4 billion, respectively. Detailed results showing the breakdown of the 

NPV into national equipment costs and national operating costs are provided in Appendix 11B. 

Table 11.5.10 Microwave Ovens: Cumulative NPV Results based on Seven-Percent and 

Three-Percent Discount Rates 

TSL EF 

NPV 

7% Discount Rate 

billion 2006$ 

3% Discount Rate 

billion 2006$ 

1 0.586 -0.61 -1.07 

2 0.588 -1.60 -2.96 

3 0.597 -3.06 -5.72 

4 0.602 -4.94 -9.28 

11.6 IMPACT OF STANDARDS ON NATURAL GAS AND ELECTRICITY 

PRICES AND ASSOCIATED CONSUMER BENEFITS 

11.6.1 Impact on Natural Gas Prices 

DOE conducted an analysis on the potential impact on natural gas prices resulting from 

the promulgation of new standards on cooking products at maximum technologically feasible 

(i.e., “Max Tech”) standard levels. “Max Tech” standard levels correspond to TSL 4 for 

cooktops and ovens and TSL 4 for microwave ovens. The analysis used a version of NEMS 

called NEM-BT, modified to account for energy savings associated with the proposed standards. 

As described in Chapter 14 on the utility impact analysis, using NEMS-BT for such an analysis 

typically involves using higher-decrement runs to isolate the impacts of the standards from 

numerical noise. DOE derived the price effect results associated with the energy savings 

resulting from the Max Tech standards using a regressed interpolation toward the origin. 

DOE examined the Max Tech scenario consisting of TSL 4 for cooktops and ovens and 

TSL 4 for microwave ovens. 

Figure 11.6.1 shows the change in total natural gas consumption for the year 2030 (on the 

x-axis) resulting from Max Tech standard levels and the corresponding change in U.S. average 

wellhead natural gas price (on the y-axis). The points in Figure 11.6.1 that are labeled with 

11-31 

EERE-2006-STD-0127 COMMENT 64.2
“50x”, “60x” or “75x” represent the results for a series of higher decrement runs assuming 

various multiples of the savings resulting from the Max Tech scenarios. Each scenario has 

multiple points that represent the results using the Annual Energy Outlook (AEO) 2008 

Reference Case.6

 The interpolated results for the Max Tech standard levels are shown in the 

upper right hand corner of Figure 11.6.1. For the Max Tech standard levels, NEMS predicts that 

the 2030 average wellhead natural gas price will remain unchanged for the cooking product 

standards. As shown in Table 11.6.1, relative to AEO 2008 Reference Case values, the 

forecasted wellhead price decline in 2030 is zero percent. Other outputs from NEMS show that 

the predicted reduction in the average-customer natural gas price in 2030 is also unchanged.b 

Because the results shown in Table 11.6.1 show that cooking product energy efficiency 

standards at the Max Tech level have no impact on average well head prices, efficiency standards 

for cooking products, even at the Max Tech level, will have no effect on natural gas consumer 

prices. 

50xCook 

Cook MaxTech 

Mar13 

75xCook 

60xCook 

-1.2 -1.0 -0.8 -0.6 -0.4 -0.2 0.0 

Change in Total Natural Gas Consumption (Quads) 

0.02 

0.00 

-0.02 

-0.04 

-0.06 

-0.08 

-0.10 

-0.12 

-0.14 

-0.16 

-0.18 

Change in Wellhead Natural Gas Price (2006 

$/MBtu) 

Figure 11.6.1 Wellhead Natural Gas Price Change in 2030 Resulting from 

Reduced Natural Gas Consumption Associated with Max Tech 

Standard Levels 

b

 The main customer sectors are electric power, industry, residential and commercial. 

11-32 

EERE-2006-STD-0127 COMMENT 64.2
Table 11.6.1 Impact of Max Tech Standard Levels on Natural Gas Consumption and 

Average Wellhead Price in 2030 

No-Standard Case Max Tech Scenario Result 

Nat Gas 

Consumption 

Nat Gas 

Price 

Nat Gas 

Consumption 

Change in 

Consumption 

Nat Gas 

Price 

Change in 

Price 

Quads 

2006$/ 

MMBtu Quads Quads % 

2006$/ 

MMBtu 

2006$/ 

MMBtu % 

Cooking 

Product 

Max Tech 

21.4 6.63 21.4 -0.01 -0.1 6.63 0.00 0.0 

The inverse price elasticity seen in NEMS to estimate the effect of consumption on price 

varies over the forecast period due to the dynamics of natural gas supply and demand in NEMS 

(Figure 11.6.2).c

 The average value over the forecast period is 0.61 and 0.02 for cooking product 

standards (labeled as “Cook” in Figure 11.6.2). 

0.00 

0.10 

0.20 

0.30 

0.40 

0.50 

0.60 

0.70 

0.80 

Inverse Price Elasticity

Cook MaxTech CSL 

2015201620172018201920202021202220232024202520262027202820292030 

Year 

Figure 11.6.2 Inverse Natural Gas Price Elasticity from NEMS Analysis for 

Cooking Product Max Tech Standard Levels 

The average inverse price elasticity (0.61 and 0.02) reported above is generally consistent 

with other studies that used various versions of NEMS to examine the impacts to natural gas 

prices resulting from reductions in natural gas demand. In a review of a number of such studies, 

Wiser and Bollinger7

 examined analyses that reported the reduction in national natural gas 

c

 Since the demand reduction in the early years after the standard takes effect is small, the model results for those 

years may be less accurate than in later years. 

11-33 

EERE-2006-STD-0127 COMMENT 64.2
demand from certain energy policies and the resulting decline in the wellhead gas price. 

Examining the average values of the inverse price elasticity over the forecast period in each 

study, they found the average values to range from 0.7 to 4.7. It is important to note that the 

average inverse price elasticities in 13 of 19 analyses were between 0.8 and 2.0, and the average 

value from DOE's current analysis (0.90) falls in the lower end of this range. 

Although NEMS provides a detailed characterization of natural gas supply, it is 

understandable that NEMS may not accurately represent the long-run supply of natural gas of the 

country since all aspects of the future are not certain. However, other widely used complex 

energy demand/supply models produce results that are similar to NEMS results, and NEMS is 

recognized as a reliable analytical tool. Table 11.6.2 compares the results of modeling studies of 

the response of natural gas price to change in gas consumption. These results are summarized in 

a 2003 study by Stanford's Energy Modeling Forum.8

 While the magnitude of the price response 

(as summarized by the inverse price elasticity) varies considerably among the models reviewed, 

in general, they confirm that a sizable price impact is associated with changes in natural gas 

consumption.d

 It is worth noting that the NEMS long-run (2020) response is smaller than that of 

most of the other models. 

Table 11.6.2 Implicit Natural Gas Inverse Price Elasticity from Seven Energy Models 

2005 2010 2015 2020 Average 

NEMS 1.8 2.2 0.53 0.11 1.2 

POEMS 2.4 1.8 2.5 1.8 2.1 

CRA 3.5 2.5 1.1 0.9 2.0 

NANGAS 5.4 7.0 7.6 5.1 6.3 

E2020 1.5 1.0 1.0 0.7 1.1 

MARKAL N/A 2.0 N/A 2.1 2.1 

NARG 8.7 12.4 5.6 2.4 7.3 

NEMS (National Energy Modeling System, 2002); POEMS (Policy Office Electricity Modeling System), CRA 

(Charles River Associates), NANGAS (North American Natural Gas Analysis System), E2020 (Energy 2020), 

MARKAL (MARKet ALlocation), NARG (North American Regional Gas model) 

Source: Based on EMF, 2003 

In addition to the models listed in Table 11.6.2, there exist studies conducted by the 

National Petroleum Council9

 and the National Commission on Energy Policy10 that are based on 

the EEA model. The EEA model shows higher inverse price elasticities (between 4.0 and 16.8), 

leading to larger natural gas price reductions for a given demand decrease, than those predicted 

by NEMS and most of the other national energy models. 

d

 The EMF scenarios actually modeled the impact of increased gas demand on price. Assuming a smooth supply 

curve over the long term, however, the elasticities implied by an increase in demand should be essentially equivalent 

to those implied by a decrease in demand. Two of the models (NANGAS and NARG) report somewhat anomalous 

inverse elasticities for undetermined reasons. 

11-34 

EERE-2006-STD-0127 COMMENT 64.2
11.6.2 Impact on Electricity Prices 

DOE also conducted an analysis on the potential impact on electricity prices resulting 

from the promulgation of new standards on cooking products at maximum technologically 

feasible (i.e., “Max Tech”) standard levels. “Max Tech” standard levels correspond to TSL 4 for 

cooktops and ovens and TSL 4 for microwave ovens. The analysis used a version of NEMS 

called NEMS-BT, modified to account for energy savings associated with the proposed 

standards. Again, using NEMS-BT for such an analysis typically involves using higherdecrement runs to isolate the impacts of the standards from numerical noise. DOE derived the 

price effect results associated with the energy savings resulting from the Max Tech standards 

using a regressed interpolation toward the origin. 

DOE examined the Max Tech scenario consisting of TSL 4 for cooktops and ovens and 

TSL 4 for microwave ovens. 

Figure 11.6.3 shows the change in total electric power consumption for the year 2030 (on 

the x-axis) resulting from Max Tech standard levels and the corresponding change in U.S. 

average electricity price (on the y-axis). The points in Figure 11.6.3 that are labeled with “50x”, 

“60x” or “75x” represent the results for a series of higher decrement runs assuming various 

multiples of the savings resulting from the Max Tech scenarios. Each scenario has multiple 

points that represent the results using the Annual Energy Outlook (AEO) 2008 Reference Case.5 

The interpolated results for the Max Tech standard levels are shown in the upper right hand 

corner of Figure 11.6.3. For the Max Tech standard levels, NEMS predicts that the 2030 average 

electricity price will remain unchanged for the cooking product standards. As shown in Table 

11.6.3, relative to AEO 2008 Reference Case values, the forecasted electricity price decline in 

2030 is zero percent. Other outputs from NEMS show that the predicted reduction in the 

average-customer electricity price in 2030 is also unchanged.e 

Because the results shown in Table 11.6.3 show that cooking product energy efficiency 

standards at the Max Tech level have no impact on average electricity prices, efficiency 

standards for cooking products, even at the Max Tech level, will have no effect on the average 

electricity price to end users. 

e

 The main customer sectors are electric power, industry, residential and commercial. 

11-35 

EERE-2006-STD-0127 COMMENT 64.2
Cook MaxTech 

50xCook 

Mar13 

75xCook 

60xCook 

0.00 

-0.01 

-0.02 

-0.03 

-0.04 

-0.05 

-0.06 

-0.07 

-0.7 -0.6 -0.5 -0.4 -0.3 -0.2 -0.1 0.0

Change in Total Electricity Consumption (Quads)

Figure 11.6.3 Electricity Price Change in 2030 Resulting from Reduced 

Electricity Consumption Associated with Max Tech Standard 

Levels 

Table 11.6.3 Impact of Max Tech Standard Levels on Electricity Consumption and Price 

in 2030 

Change in Electricity Price (2006-$/MBtu) 

No-Standard Case Max Tech Scenario Result 

Electricity 

Consumption 

Electricity 

Price 

Electricity 

Consumption 

Change in 

Consumption 

Electricity 

Price 

Change in 

Price 

Quads 

2006$/ 

MMBtu Quads Quads % 

2006$/ 

MMBtu 

2006$/ 

MMBtu % 

Cooking 

Product 

Max Tech 

49.21 25.93 49.20 -0.01 -0.02% 25.93 0.00 0.0 

The inverse price elasticity seen in NEMS is used to estimate the effect of consumption 

on price varies over the forecast period due to the dynamics of energy supply and demand in 

NEMS (Figure 11.6.4).f

 The average value over the forecast period is 0.67 and 0.30 for cooking 

product standards (labeled as “Cook” in Figure 11.6.4). 

f

 Since the demand reduction in the early years after the standard takes effect is small, the model results for those 

years may be less accurate than in later years. 

11-36 

EERE-2006-STD-0127 COMMENT 64.2
Inverse Price Elasticity 

1.40 

1.20 

1.00 

0.80 

0.60 

0.40 

0.20 

0.00 

Cook MaxTech CSL 

2015201620172018201920202021202220232024202520262027202820292030 

Year 

Figure 11.6.4 Inverse Electricity Price Elasticity from NEMS Analysis for 

Cooking Product Max Tech Standard Levels 

11-37 

EERE-2006-STD-0127 COMMENT 64.2
REFERENCES 

1 U.S. Department of Energy-Office of Energy Efficiency and Renewable Energy. Technical 

Support Document: Energy Efficiency Program for Consumer Products and Commercial and 

Industrial Equipment: Residential Dishwashers, Dehumidifiers, Cooking Products, and 

Commercial Clothes Washers, September, 2008. Washington, DC. 

<http://www1.eere.energy.gov/buildings/appliance_standards/residential/home_appl_tsd.html> 

2 U.S. Department of Energy-Energy Information Administration. Annual Energy Outlook 

2009 Early Release, December, 2008. Washington, DC. <http://www.eia.doe.gov/oiaf/aeo/> 

3 RS Means. Mechanical Cost Data, 31st Annual Edition, 2008. Kingston, MA. 

4 Craftsman Book Company, 2008 National Home Improvement Estimator. 2008. Carlsbad, 

CA. 

<http://craftsman-book.com/products/index.php?main_page=cbc_product_book_info&products_id=396> 

5 Craftsman Book Company, 2008 National Repair & Remodeling Estimator. 2008. Carlsbad, 

CA. 

< http://craftsman-book.com/products/index.php?main_page=cbc_product_book_info&products_id=400> 

6 U.S. Department of Energy - Energy Information Administration, Annual Energy Outlook 

2008 (Revised Early Release) with Projections to 2030. 2008: Washington, DC. 

<http://www.eia.doe.gov/oiaf/aeo/> 

7 Ryan Wiser, Mark Bolinger, and Matt St. Clair, Easing the Natural Gas Crisis: Reducing 

Natural Gas Prices through Increased Deployment of Renewable Energy and Energy 

Efficiency. 2005, Lawrence Berkeley National Laboratory. 

8 Natural Gas, Fuel Diversity and North American Energy markets, Energy Modeling Forum, 

Stanford University. 

9 Balancing Natural Gas Policy - Fueling the Demands of a Growing Economy, Vol. I 

Summary of Findings and Recommendations, National Petroleum Council. 

10 National Commission on Energy Policy, Increasing U.S. Natural Gas Supplies: A Discussion 

Paper and Recommendations from the National Commission on Energy Policy. 2003. 

11-38 

EERE-2006-STD-0127 COMMENT 64.2