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ACHIEVING—AT LONG LAST—APPLIANCE

EFFICIENCY STANDARDS

HEARING

BEFORE THE

SUBCOMMITTEE ON ENERGY AND AIR QUALITY

OF THE

COMMITTEE ON ENERGY AND

COMMERCE

HOUSE OF REPRESENTATIVES

ONE HUNDRED TENTH CONGRESS

FIRST SESSION

MAY 1, 2007

Serial No. 110–36

(

Printed for the use of the Committee on Energy and Commerce

energycommerce.house.gov
COMMITTEE ON ENERGY AND COMMERCE

JOHN D. DINGELL, Michigan, Chairman

HENRY A. WAXMAN, California

EDWARD J. MARKEY, Massachusetts

RICK BOUCHER, Virginia

EDOLPHUS TOWNS, New York

FRANK PALLONE, JR., New Jersey

BART GORDON, Tennessee

BOBBY L. RUSH, Illinois

ANNA G. ESHOO, California

BART STUPAK, Michigan

ELIOT L. ENGEL, New York

ALBERT R. WYNN, Maryland

GENE GREEN, Texas

DIANA DEGETTE, Colorado

Vice Chairman

LOIS CAPPS, California

MIKE DOYLE, Pennsylvania

JANE HARMAN, California

TOM ALLEN, Maine

JAN SCHAKOWSKY, Illinois

HILDA L. SOLIS, California

CHARLES A. GONZALEZ, Texas

JAY INSLEE, Washington

TAMMY BALDWIN, Wisconsin

MIKE ROSS, Arkansas

DARLENE HOOLEY, Oregon

ANTHONY D. WEINER, New York

JIM MATHESON, Utah

G.K. BUTTERFIELD, North Carolina

CHARLIE MELANCON, Louisiana

JOHN BARROW, Georgia

BARON P. HILL, Indiana

JOE BARTON, Texas

Ranking Member

RALPH M. HALL, Texas

J. DENNIS HASTERT, Illinois

FRED UPTON, Michigan

CLIFF STEARNS, Florida

NATHAN DEAL, Georgia

ED WHITFIELD, Kentucky

BARBARA CUBIN, Wyoming

JOHN SHIMKUS, Illinois

HEATHER WILSON, New Mexico

JOHN B. SHADEGG, Arizona

CHARLES W. ‘‘CHIP’’ PICKERING,

Mississippi

VITO FOSSELLA, New York

STEVE BUYER, Indiana

GEORGE RADANOVICH, California

JOSEPH R. PITTS, Pennsylvania

MARY BONO, California

GREG WALDEN, Oregon

LEE TERRY, Nebraska

MIKE FERGUSON, New Jersey

MIKE ROGERS, Michigan

SUE WILKINS MYRICK, North Carolina

JOHN SULLIVAN, Oklahoma

TIM MURPHY, Pennsylvania

MICHAEL C. BURGESS, Texas

MARSHA BLACKBURN, Tennessee

PROFESSIONAL STAFF

DENNIS B. FITZGIBBONS, Chief of Staff

GREGG A. ROTHSCHILD, Chief Counsel

SHARON E. DAVIS, Chief Clerk

BUD ALBRIGHT, Minority Staff Director

(II)
(III)

SUBCOMMITTEE ON ENERGY AND AIR QUALITY

RICK BOUCHER, Virginia, Chairman

G.K. BUTTERFIELD, North Carolina,

Vice Chairman

CHARLIE MELANCON, Louisiana

JOHN BARROW, Georgia

HENRY A. WAXMAN, California

EDWARD J. MARKEY, Massachusetts

ALBERT R. WYNN, Maryland

MIKE DOYLE, Pennsylvania

JANE HARMAN, California

TOM ALLEN, Maine

CHARLES A. GONZALEZ, Texas

JAY INSLEE, Washington

TAMMY BALDWIN, Wisconsin

MIKE ROSS, Arkansas

DARLENE HOOLEY, Oregon

ANTHONY D. WEINER, New York

JIM MATHESON, Utah

JOHN D. DINGELL, Michigan (ex officio)

J. DENNIS HASTERT, Illinois,

Ranking Member

RALPH M. HALL, Texas

FRED UPTON, Michigan

ED WHITFIELD, Kentucky

JOHN SHIMKUS, Illinois

JOHN B. SHADEGG, Arizona

CHARLES W. ‘‘CHIP’’ PICKERING,

Mississippi

STEVE BUYER, Indiana

MARY BONO, California

GREG WALDEN, Oregon

MIKE ROGERS, Michigan

SUE WILKINS MYRICK, North Carolina

JOHN SULLIVAN, Oklahoma

MICHAEL C. BURGESS, Texas

JOE BARTON, Texas (ex officio)

PROFESSIONAL STAFF

SUE D. SHERIDAN, Chief Counsel

JOHN JIMISON, Counsel

DAVID MCCARTHY, Minority Counsel

MARGARET HORN, Clerk

(V)

C O N T E N T S

Page

Hon. Rick Boucher, a Representative in Congress from the Commonwealth

of Virginia, opening statement ............................................................................ 1

Hon. J. Dennis Hastert, a Representative in Congress from the State of

Illinois, opening statement .................................................................................. 3

Hon. Fred Upton, a Representative in Congress from the State of Michigan,

opening statement ................................................................................................ 4

Hon. John D. Dingell, a Representative in Congress from the State of Michigan, prepared statement ...................................................................................... 141

WITNESSES

Alexander Karsner, Assistant Secretary, Energy Efficiency and Renewable

Energy, U.S. Department of Energy ................................................................... 6

Prepared statement .......................................................................................... 9

Answers to submitted questions ...................................................................... 194

Arthur Rosenfeld, commissioner, California Energy Commission ....................... 18

Prepared statement .......................................................................................... 21

Answers to submitted questions ...................................................................... 241

Evan Gaddis, president and chief executive officer, National Electrical Manufacturers Association ............................................................................................ 42

Prepared statement .......................................................................................... 44

Answers to submitted question ....................................................................... 169

C. David Myers, vice president, building efficiency, Johnson Controls, Inc. ...... 56

Prepared statement .......................................................................................... 58

Answers to submitted questions ...................................................................... 230

Joseph McGuire, president, Association of Home Appliance Manufacturers ..... 64

Prepared statement .......................................................................................... 66

Answers to submitted questions ...................................................................... 219

Douglas Johnson, senior director, technology policy and international affairs,

Consumer Electronics Association ...................................................................... 79

Prepared statement .......................................................................................... 81

Andrew Delaski, executive director, Appliance Standards Awareness Project .. 91

Prepared statement .......................................................................................... 94

Answers to submitted questions ...................................................................... 158

Charles Harak, National Consumer Law Center .................................................. 111

Prepared statement .......................................................................................... 113

Answers to submitted questions ...................................................................... 180
(1)

ACHIEVING-AT LONG LAST-APPLIANCE

EFFICIENCY STANDARDS

TUESDAY, MAY 1, 2007

HOUSE OF REPRESENTATIVES, SUBCOMMITTEE ON ENERGY AND AIR QUALITY, COMMITTEE ON ENERGY AND COMMERCE, Washington, DC.

The subcommittee met, pursuant to call, at 10:00 a.m., in room

2322 of the Rayburn House Office Building, Hon. Rick Boucher

(chairman) presiding.

Members present: Representatives Butterfield, Barrow, Wynn,

Inslee, Baldwin, Hooley, Matheson, Hastert, Upton, Shimkus, Pickering, Walden, Burgess, and Barton.

Staff present: Sue Sheridan, John Jimison, Laura Vaught, Chris

Treanor, Margaret Horn, David McCarthy, Kurt Bilas, Peter

Kielty, Matthew Johnson, Legislative Analyst, and Garrett

Golding.

OPENING STATEMENT OF HON. RICK BOUCHER, A REPRESENTATIVE IN CONGRESS FROM THE COMMONWEALTH

OF VIRGINIA

Mr. BOUCHER. The subcommittee will come to order. This morning we will examine appliance efficiency standards and hear from

appliance and equipment manufacturing groups, as well as efficiency advocates and officials responsible for implementation of

Federal and State energy efficiency programs. It is our intention to

develop legislative provisions from today’s hearing for inclusion in

the energy independence legislation which this committee will consider and report to the full House during the course of the next several weeks and that will be considered on the House floor during

the month of July.

Federal law has required the establishment of energy efficiency

standards for a group of 20 categories of home appliances since

1975. However, there have been longstanding problems with the

implementation of these required standards. Earlier this year, the

Government Accountability Office produced a report which I had

requested, along with Chairman Dingell and Mr. Markey, on the

Department of Energy’s record with regard to setting appliance efficiency standards. The GAO report indicated that DOE has failed

to set standards for 17 of the 20 categories of appliances originally

required by law.

In fact, DOE missed all 34 of the statutory deadlines for developing the standards. These delays have spanned more than 30 years

and encompass administrations of both political parties. The GAO
2

estimates that Americans have, to date, spent $28 billion for energy that they could have avoided if the standards that should

have been adopted had, in fact, been adopted. Moreover, these inefficient appliances will continue operating in American homes and

businesses for years to come. It is, therefore, clear that the failure

to meet the deadlines for issuing standards has been a major problem and that the past failures have populated our homes and businesses with appliances significantly less efficient than they should

have been.

Despite these longstanding delays and associated problems, there

has recently been progress. The DOE entered into a consent decree

in November 2006 in which the Department promised the court it

would meet a new set of short-term deadlines to make up for the

deficiencies and to date, DOE has, in fact, met those deadlines.

DOE Assistant Secretary for Energy Efficiency and Renewable Energy, Andy Karsner, who we will hear from today, has an admirable record during his time in that position. And I want to commend

him for the work that he has done. He has pledged to make up the

backlog of overdue standards. He is to be commended for that program and we all look forward to hearing his testimony this morning about the work that he is overseeing.

Further progress has been reached by the affected industries and

efficiency advocacy groups, which have reached a number of consensus agreements on new standards for various products. Some of

these consensus agreements have been adopted into law and others

are subject to the DOE regulatory process at the present time or

are being proposed to this subcommittee for legislative enactment.

While this recent progress is, indeed, promising, serious concerns

surrounding the appliance efficiency program remain. The GAO report identified a number of obstacles to improvements in the program. Among the report’s conclusions are areas that clearly warrant further examination, including the fact that DOE lacks the

program management practices to ensure that the program is kept

up to date. Questions about whether DOE has the staff and budget

resources to make up for the backlog on pending standards. Whether the department’s product testing procedures need to be updated

and conducted more frequently. The extent to which a State is preempted from adopting its own standard for a product that is covered by Federal law, even if the DOE has failed to meet its own

deadlines for imposing regulatory treatment for those particular

products. And whether the DOE can and should expedite rulemaking proceedings in cases where a consensus exists between the

affected industry and efficiency advocates.

Other questions also warrant further consideration. DOE has

concluded that it is prevented by law from setting more than one

national standard for a given category of appliance. This appears

to be an unreasonable limitation. For example, significant climate

variations among zones of the Nation suggest that for heating and

air conditioning equipment, different efficiency standards might be,

to quote the statute, ‘‘technologically feasible’’ and ‘‘economically

justified.’’ As a result, the recently adopted DOE standard for furnaces, at 80 percent thermal efficiency, is below State standards in

a number of the northern States and is actually below the effi-
3

ciency rating that is achieved by 99 percent of the furnaces already

on the market.

Another matter of concern is whether or not DOE should be able

to set more than one performance standard for a covered product.

For example, should they be able to set both a heating efficiency

standard and a fan motor efficiency standard for a furnace? In

other words, is it appropriate, in some cases, to have multiple

standards for various functions of a single product? There is also

a question regarding whether DOE should be able to dictate design

features for a covered product that may have a role in energy efficiency, but would also have other roles, such as whether a switch

must be provided to turn a product, which is normally designed to

go into standby mode, completely off.

Today’s witnesses will provide us with an in-depth analysis of

the status of the DOE program, as well as suggestions for possible

statutory improvements to that program and an overview of areas

in which consensus has been reached. And I want to say welcome

to all of our witnesses. We will hear your testimony shortly.

It is now my pleasure to recognize the ranking member of this

subcommittee, the gentleman from Illinois, Mr. Hastert, for 5 minutes.

OPENING STATEMENT OF HON. J. DENNIS HASTERT, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF ILLINOIS

Mr. HASTERT. Thank you, Mr. Chairman. Thank you for holding

this hearing. Energy efficiency is certainly an essential element of

energy security. The hearing today is particularly timely as we

head into our peak months of energy use, both in electricity and

in transportation. Efficiency gains we have already achieved in the

U.S. economy are impressive. The total amount of energy used in

this country’s recent years has not grown as much as our economy.

That being said, much of our economic growth has been spurred by

productivity gains made possible by innovations that allow us to

use less energy to accomplish the same amount of work in factories, offices, and even at home.

But far more needs to be done and we should not wait any longer

to make our cars, our buildings, our appliances more energy efficient. If we want to lessen our dependence on unstable sources of

foreign oil and meet our growing overall demand for electricity, we

simply must look harder at what we could do to be more energy

efficient. The Energy Policy Act, which we passed last Congress,

did just that. We set efficiency standards for Federal buildings,

raised the level for commercial and household appliances and created tax incentives for increased energy efficiency and conservation

of energy.

I think it is now important that we hear from the Department

of Energy. We need to uncover the major reasons for DOE’s delays

in setting efficiency standards. We also need to hear what the department is doing to correct the situation and what further steps

require legislation. It is also important to hear from experts in the

State government, industry, and other stakeholders. Mr. Chairman, we need to make sure that in trying to be careful with legislation we don’t make the standard setting process more complicated or time consuming than it needs to be. At the same time,
4

the process must be flexible so that the standards can keep pace

with new developments in energy and more efficient technology.

Lighting technology is a good example of what we see current

standards not keeping pace with technology. PolyBrite International, for instance, is a company based in Illinois. It makes light

emitting diode light bulbs that look and feel the same as the bulbs

that we put in our homes or any of the lighting that we have right

here in this committee room. The difference is these bulbs are 100

percent green with no mercury or hazardous material. They last up

to 10 years and they emit no heat or UV rays and use 90 percent

less energy consumption than everyday bulbs. They are 90 percent

more energy efficient than lighting that we use in this country.

The energy savings cost the Federal Government alone in using

these types of bulbs could be billions of dollars a year. Mr. Upton

and Ms. Harman have taken the lead to ensure cost-saving environmentally safe technology like this is utilized. I commend them

for these efforts and look forward to supporting them as they move

legislation forward to upgrade lighting efficiency standards in the

United States.

However, we must also look beyond lighting efficiency. Vehicles,

heating and cooling systems and building design are all other areas

we need to look closely at to understand what we can do to achieve

more energy efficiency without asking people to compromise safety,

security, comfort in the settings. I welcome our witnesses and look

forward to their testimony to learn more on what they feel this

Congress and particularly, this committee, can do to encourage new

technologies and speed the efficiency standards process along.

Mr. Chairman, again, thanks for holding this hearing and I yield

back the balance of my time.

Mr. BOUCHER. Thank you very much, Mr. Hastert. The gentlewoman from Oregon, Ms. Hooley, is recognized for 5 minutes.

Ms. HOOLEY. Thank you, Mr. Chairman. I have a statement that

I will submit for the record, but just wanting to say that in 1983,

which is a couple of years ago, when I served on the Oregon legislature, one of the things we tried to do, along with California, is improve the standards for appliances, so it is interesting that 24

years later I am sitting here at a hearing doing the same thing,

so I am looking forward to your hearing and your testimony.

Mr. BOUCHER. Thank you very much, Ms. Hooley. And I would

announce that Members who elect to waive an opening statement

will have the time for that opening statement added to their period

for propounding questions. The gentleman from Michigan, Mr.

Upton, is recognized for 3 minutes.

OPENING STATEMENT OF HON. FRED UPTON, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF MICHIGAN

Mr. UPTON. Well, thank you, Mr. Chairman. I appreciate your

leadership on this issue in having this hearing this morning. I

would say that there is a great frustration among many in this

Congress, and I also know in the administration, that we have not

been able to see a standard given for appliances with energy efficiency. It is a great frustration.

I can remember well when Secretary Bodman came to testify before this committee, I want to say 2 or 3 years ago, and in that
5

opening testimony, he, in fact, shared that frustration and was curious to know about the morale in the Department, knowing that

they had been decades overdue in terms of promulgating these regulations that frankly, the industry wants. The American industry

DOEs want energy efficient standards and despite the pushes and

prods by the Congress, the legislation, we have really seen nothing

move through the door, whether it be, perhaps, DOE or through

OMB.

So I look forward to this hearing. I look forward to hearing the

testimony of our able witnesses and hopefully, this will, in fact,

start a spark to see these regulations promulgated and the appliances built and come into consumers’ homes all across this great

Nation and Mr. Speaker, or Mr. Chairman, I yield back my time.

Mr. BOUCHER. Thank you very much, Mr. Upton.

Mr. UPTON. I was looking at Mr. Hastert.

Mr. BOUCHER. I am told it is not a bad job. The gentleman from

Georgia, Mr. Barrow, is recognized for 3 minutes.

Mr. BARROW. Mr. Chairman, I apologize for stepping out for a

second. I will waive the opportunity for an opening.

Mr. BOUCHER. Mr. Barrow waives an opening statement. The

gentleman from Utah, Mr. Matheson, is recognized for 3 minutes.

Mr. MATHESON. I will waive.

Mr. BOUCHER. Mr. Matheson waives his opening statement. And

the gentleman from Oregon, Mr. Walden, is recognized.

Mr. WALDEN. Thank you, Mr. Chairman. I will waive my opening

statement.

Mr. BOUCHER. Mr. Walden waives his statement, as well.

Mr. BOUCHER. We now welcome our panel of witnesses and I will

say a brief word of introduction about each.

Mr. Andrew Karsner is the Department of Energy’s Assistant

Secretary for Energy Efficiency and Renewable Energy. And as I

said previously, he has made a commendable commitment to improving the efficiency program at DOE.

Art Rosenfeld is a commissioner on the California Energy Commission. Mr. Rosenfeld’s outstanding work in the area of efficiency

spans a number of decades, including his work as co-founder of the

American Council for an Energy Efficient Economy and his leadership on a Nobel Prize winning particle physics group.

Mr. Evan Gaddis is the president and chief executive officer of

the National Electrical Manufacturers Association.

David Myers is vice president for building efficiency with Johnson Controls and is testifying on behalf of the Air Conditioning and

Refrigeration Institute and the Gas Appliance Manufacturers Association.

Joseph McGuire is the president of the Association of Home Appliance Manufacturers.

Doug Johnson is the senior director for technology policy and

international affairs at the Consumer Electronics Association.

Andrew deLaski is the executive director of the Appliance Standards Awareness Project.

And Charles Harak is the National Consumer Law Center representative. That center is located in Boston.

We want to say welcome to each of our witnesses and without

objection, your prepared written statement will be made a part of
6

the record. We would welcome now your oral summary and I ask

that you keep that to approximately 5 minutes. And Mr. Karsner,

we will be happy to begin with you.

STATEMENT OF ALEXANDER KARSNER, ASSISTANT SECRETARY, ENERGY EFFICIENCY AND RENEWABLE ENERGY,

U.S. DEPARTMENT OF ENERGY

Mr. KARSNER. Thank you, Chairman Boucher, Ranking Member

Hastert, members of the committee and let me begin by saying

thank you for your confidence and generous praise in your opening

remarks. Any success that we are having is largely due to the career professionals and Federal employees, some of whom are sitting

behind me: David Rogers and Rob Lewis and Mike McKay and

their responsiveness to a new era of organization. I also want to

thank you for the opportunity to testify today on energy conservation standards programs at the Department of Energy.

As is well known, over the last three decades, the Department

has fallen behind in setting and updating required standards. The

frustration felt by Congress and by many stakeholders is amply

justified. I understand the skepticism as to whether the Department can remedy this longstanding problem. Past delays are the

results of many factors over many years and cannot be traced to

any single administration or management team. I am not here to

defend that history, but I do want to provide some context.

This is a challenging area of significant complexity, but the scale

of potential energy savings for our Nation demands that we address it with renewed vigor and commitment. By law, energy conservation standards settings must incorporate both the cost and

benefits to the consumer and the Nation, as well as the impact on

manufacturers. The Department’s technical and economic analysis

must be thorough, accurate and publicly vetted with stakeholders

to support the very difficult decisions involved in setting standards

levels that are safe, technologically feasible, economically justified

and result in significant conservation of energy as is required by

law.

Energy conservation standards are generally established by three

phase public process: an Advance Notice of Proposed Rulemaking,

what we call an ANPR; Notice of Proposed Rulemaking, the NPR;

and a final rule. In addition to the cost benefit analyses and factors

that Congress directed the Department to consider in rulemakings

and the public comments requirements, the Department must also

conduct reviews for 13 other requirements, such as Regulatory

Flexibility Act and the National Environmental Policy Act of 1969

or NEPA.

Many of these reviews require preparation of additional analyses

and/or reviews by other entities such as the Office of Management

and Budget, the Small Business Administration, the Department of

Justice and the Federal Trade Commission, for example. Nearly

one-third of the time to produce a conservation standard is devoted

to accomplishing these required external reviews. Since arriving at

the Department of Energy last year, I have made efficiency standards a top priority, as has Secretary Bodman. The Department is

unequivocally committed to addressing the backlog of rulemakings

and meeting all of its statutory requirements.
7

On January 31, 2006, the Department submitted a report to Congress on its standards activities prepared in response to section 141

of the Energy Policy Act of 2005. The report publicly laid out our

action plan and schedule for rulemakings out to the year 2011.

Since committing to this schedule for the standards program, I am

happy to report the Department has met 100 percent of its targets.

We have completed eight rulemakings since EPAct 2005, including

test procedure rulemaking and codification of prescribed standards

and it made significant progress on others that were under way

prior to EPAct 2005.

In 2006 alone, in fact, we began rulemakings for 12 additional

products. These recent accomplishments represent a pace substantially more aggressive than at any time prior in the Department’s

history. Final rules for electric distribution transformers and residential furnaces and boilers are presently on schedule to be issued

by September 30 of this year. The Department has published a Notice of Proposed Rulemaking for single product test procedure, residential central air conditioners and heat pumps and a final rule for

multiple test procedures.

Our Department’s senior leadership has demonstrated a strong

commitment to improving the energy conservation standards programs. In 3 successive years the President has requested budget

increases for this program. In addition, the flexibility provided by

the fiscal year 2007 Continuing Resolution allowed the Department

to shift additional funding into accelerating efficiency standards.

These increased resources in combination with streamlining and

accelerating our internal processes are indeed making a difference

and have led to real efficiency gains.

One example of the process improvements we are making is the

use of product bundling within a single rulemaking to achieve significant economies of scale. For example, for the home appliance

rulemaking, we brought together four product categories that, for

the most part, are manufactured by the same companies. This bundling allows us to address the backlogged rulemaking for residential dishwashers and cooking products, while at the same time

meeting the new EPAct 2005 deadline for commercial clothes washers and residential dehumidifiers.

I am pleased to say that as a result of the collective efforts of

industry and other stakeholder groups, a consensus agreement has

been reached on dishwashers and dehumidifiers, as well as other

home appliance products. In addition to bundling similar products,

we have organized staff and contractors into seven technology

teams; heating, transformers and motors, lighting, home appliances, space cooling, commercial refrigeration and battery chargers

and external power supplies.

The Department is also implementing a substantially improved

document review and clearance process with an intra-agency crosscutting review team that includes the Appliance Standards Program in our shop, the Office of General Counsel, and the Office of

Policy and International Affairs. In February, Secretary Bodman

sent legislation to Congress requesting authorization to streamline

the standards process and bring more efficient products to market

even sooner.
8

This fast track legislative proposal would allow the Department

to move directly to a final rule for certain products when a clear

consensus for standards exist among the manufacturers, efficiency

advocates and other stakeholders. In some cases, directly proposing

a final rule will shorten the time to a completed standard by nearly

a third and shave off months, possibly a year or more off of the

rulemaking process.

I would like to conclude by emphasizing the Department has

been diligently implementing the productivity enhancements described in the Department’s January 31, 2006 report to Congress.

These enhancements are enabling the Department to meet aggressive schedule of rulemakings designed to clear the backlog of delayed actions that accumulated during prior years and simultaneously fulfill all the new requirements of the Energy Policy Act

of 2005.

Our multi-year schedules are firm and they are achievable. The

Department is demonstrating concrete progress and we intend to

keep this momentum going. We want an open and positive dialog

with Congress and stakeholders to ensure that the government can

keep its commitments. We must—and we are—moving forward.

Mr. Chairman, this concludes my prepared statement and I

would be happy to answer any questions the committee may have.

[The prepared statement of Mr. Karsner follows:]
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13
14
15
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Mr. BOUCHER. Thank you very much, Mr. Karsner. Dr.

Rosenfeld, we will be happy to hear from you.

STATEMENT OF ARTHUR ROSENFELD, COMMISSIONER,

CALIFORNIA ENERGY COMMISSION, SACRAMENTO, CA

Mr. ROSENFELD. Good morning, Mr. Boucher, Mr. Hastert and

committee. Before I talk about legislation, actually, my job has

been made a little easier there because if I take the opening remarks of Mr. Boucher and Mr. Hastert and they ask should DOE

have more powers and more resources, I think if I answer yes to

all of your questions, I will have done, sort of, my job.

I want to take a couple of minutes just to give sort of a pep talk

on behalf of, I think, all of the witnesses here. We are all happy

to be loved again with all this interest in energy efficiency and we

all represent energy efficiency. To show how important energy efficiency has been in terms of saving money for the United States as

a whole and then to take the point of view for California, for a moment.

[Slide]

If we could have the first figure, not just my name. That is a plot

of energy intensity. Energy intensity is the amount of primary energy which it takes to make a dollar of gross domestic product. It

is the amount of energy which we need every year per dollar.

The horizontal line is the embargo in 1973. The heavy blue line,

which has been coming down slowly in energy intensity before the

embargo and the light red line, which shows a big red wedge, is

the business-as-usual scenario. We were improving. We were improving about less than half percent per year. Then suddenly you

see the effect of energy policy. You see a wedge opening up as we

put in building and appliance standards, automobile efficiency

standards and prices were raised, to get our attention, from OPEC.

And that wedge represents a huge savings.

This plot is published every month by the Energy Information

Agency, but they don’t put my two little marks at the right, which

is the dollars. We actually spent, last year, for our energy bill in

this country $1 trillion, which is 7.5 percent of our gross domestic

product. But if you take the business-as-usual line, if we hadn’t

had energy policy and some structural change, it would have been

$1.7 trillion. Folks, we are saving $700 billion every year through

having improved our energy efficiency, typically with a 5-year payback, so that almost nobody noticed.

That is a lot of money. That is $700 billion, $500 billion of which

is energy policy, represents the annual budget of the Department

of Defense, including the Iraq war. We are all conscious of that. We

are seldom conscious that just good policies have made this advantage. Having made that point, I will show the second slide, only for

30 seconds.

[Slide]

It is exactly the same information, except in terms of energy

itself, so you can see a huge wedge of avoided costs, even though

the energy services went up. We have more cars, more homes, more

TVs, bigger everything, and yet we are saving $500 billion a year.

Now to make a couple remarks as a Californian. Can I have the

next plot?
19

[Slide]

Here I am not talking about raw energy, because I don’t want

to get involved with gasoline, which we have sort of neglected since

1985, so I am going to talk about electricity only where California

controls its own destiny. What you can see is the good energy policies in California have caused—the yellow line is California electricity per capita. The upward sloping gray line is the United

States electricity per capita. They were growing roughly 6 percent

a year before the embargo.

We, in California, introduced building standards and appliance

standards and conservation programs for the utilities to beat the

standards and we have kept electricity use constant per person for

30 years now, even though everything is bigger and there are more

loads and Gross Domestic Product per disposable income went up

80 percent, we managed to keep electricity use constant with better

refrigerators, better air conditioners, better buildings.

How much of that comes from standards? I will show you the

next plot and my last one.

[Slide]

This is an attempt by the Energy Commission to show how much

of that blue wedge can be attributed to building standards, appliance standards and our utility programs to beat everything that

the standards require, if possible, and you will see that appliance

standards alone represent more or less one quarter of the whole

picture. Now, those standards are not just Federal standards, but

when the Feds leave us a hole, we go ahead and pass advanced

standards and so that is Federal plus State standards. And we are

very proud of this record.

From our point of view, DOE is, in some sense, a blessing, a

mixed blessing. They do some good things, but they are usually a

little bit weak on the standards and almost invariably late, so that

my general argument is for more flexibility, more powers to DOE,

a lot more resources for DOE so they can get the standards out on

time. We are slightly against legislative consensus standards. We

think you have to do those now to catch up. But in general, we

think the good analysis with a good staff by DOE is the way to

hunker down in the future.

I will particularly make amends to Mr. Boucher’s question about

should DOE be able to address separate features like we want

clothes washers to also have a water characteristic, because water

is expensive in California and we are short on it. We want air conditioners to be able to have thermostatic expansion in addition to

co-efficiency of performance. We want all those efficient things.

The last point I am going to make, since I am into 6 minutes,

is a plea for the country to, in fact, for DOE to have the power of

clarification. The DOE has the power to do the question which you,

Mr. Boucher, addressed, which is to have more than one climate

zone for heaters and—so let us say two, north and south of the

Mason-Dixon line, and three zones for air conditioners. And I do

want to make the point about air conditioners, because it is not so

well-known. The point I want to describe here is when you say

break the country into two climate zones, you think of, again, the

north, where air conditioners run only a thousand hours a year and
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Miami or Phoenix, where they run 4,000 hours a year and you need

better air conditioners.

What is not understood so well is that an air conditioner in, say,

Atlanta, is a very different object from an air conditioner in, say,

Phoenix. In Atlanta, its main job is to take like a 90 degree very

damp air and drip the water out and that is why it is called air

conditioning instead of just cooling. Whereas in Phoenix, all we are

interested in, or California, is 115 degrees outside but no need to

drip any water out. So an Atlanta air conditioner is basically a

dripper and a Phoenix air conditioner is basically a cooler.

With the help of DOE we did runs to look at what would happen

if we optimized an air conditioner for the dry West, as opposed to

just one air conditioner for the country and it is in my appendix

C, we found out that with a 3-year payback and a total for its cost

to the manufacturer of $200 or retail, maybe $400, and a payback

time of about 3 years, that we could get a 15 percent improvement

in co-efficient performance. That means in air conditioning demand, on a hot afternoon in Fresno or Phoenix, and we in California are just not about to give up the opportunity for a 15 percent

reduction in air conditioning load, which is a third of our total load

on a hot afternoon.

Mr. BOUCHER. Dr. Rosenfeld, I am going to have to ask you to

conclude. We are almost 4 minutes beyond.

Mr. ROSENFELD. Luckily, I am through.

Mr. BOUCHER. Thank you, sir. Well, you did a very nice job and

we thank you.

Mr. ROSENFELD. Thank you, sir.

[The prepared statement of Mr. Rosenfeld follows:]
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Mr. BOUCHER. Mr. Gaddis.

STATEMENT OF EVAN GADDIS, PRESIDENT AND CEO, NATIONAL ELECTRICAL MANUFACTURERS ASSOCIATION,

ROSSLYN, VA

Mr. GADDIS. Chairman Boucher, Ranking Member Hastert, members of the committee, I am Evan Gaddis, president and CEO of

the National Electrical Manufacturers Association. NEMA’s 430

member companies make products for the generation, transmission,

distribution, control and end use of electricity. I am pleased to be

here today to present our association’s views on the important role

of the national efficiency standards program and to offer our comments on experiences involving consensus standards, legislative

changes to the statute and role of Federal pre-emption.

NEMA is experienced with the DOE program as centered on

lighting, electrical motors and distribution transformers. The deployment of energy efficient products is the cheapest, cleanest and

quickest source of meeting national energy and environmental

goals. Our industry stands at the very heart of our national effort

to achieve a reduced dependence on fossil fuels, a cleaner environment and a higher standard of living across the globe. NEMA supports a robust national energy conservation standards program

under the Energy Policy and Conservation Act, EPCA. We believe

that a strong national program of standards, test procedures and

labeling information is critical to effectively maximize energy savings for the Nation and the consuming public.

Products are manufactured and distributed on a national and

sometimes global basis and it is key that energy conservation regulation for products occur at the Federal level. NEMA has considerable experience with negotiation consensus standards and we support congressional enactment of these proposals. For instance,

NEMA and the American Council of Energy Efficient Economy

have submitted joint recommendations for a new standard for industrial electric motors. Electric motors consume 65 to 70 percent

of electrical energy used in commercial and industrial motor driven

systems like pumps, fans and compressors. Thus, increases in

motor efficiency translate to significant energy savings for industrial and manufacturing end users. The consensus proposal, if enacted by Congress, with an effective date of 2011, is estimated to

save 8 billion kilowatt hours by 2030 with a net energy savings to

consumers of almost $500 million.

NEMA is also engaged in negotiation with interested parties on

new standards for light bulbs. Lighting use in the U.S. consumes

some 20 to 22 percent of all electricity generated and 30 percent

of the energy consumed in an office building to use for lighting and

5 to 10 percent of residential energy use is for lighting. It is estimated that a comprehensive consensus agreement that works with

market forces could result in $18 billion in annual energy savings

and avoid more than 158 million tons of carbon dioxide. We believe,

based on our experience with consensus standards negotiations and

agreements, that EPCA should be amended to include procedures

for consensus agreements to be quickly acted upon by the Department of Energy.
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To date, our consensus agreements have been enacted through

legislative action. While this has had the desired effect of setting

minimum efficiency levels and advancing energy savings, it is not

practical to expect Congress should have to legislate each time a

consensus agreement is reached. That is why we support changes

to EPCA to permit stakeholders to submit, through a petition process, their consensus agreement for the Department of Energy to expeditiously consider and act upon.

Mr. Chairman, a fundamental tenet of the Energy Policy Conservation Act is the significant and longstanding principle of Federal pre-emption. NEMA supports efforts to improve and strengthen a national energy conservation program and keeping Federal

pre-emption intact. Some have proposed that Federal pre-emption

for a federally covered product should lapse if the Department of

Energy misses a rulemaking deadline for that product.

To us, this misses the point. Manufacturing should not be penalized because of the government’s lapse. If deadlines are missed, the

agency must be called to task by Congress. Placing products that

should be Federal regulated under a patchwork of State regulations is a significant burden for manufacturers, distributors and retailers. The consumer and the country are best served by having

a national energy efficiency program.

And finally, document review and clearance processes with DOE

must be streamlined and resources and budgets for the Codes and

Standards program within DOE must be adequate to perform the

task. Mr. Chairman, let me thank you for having this hearing on

DOE standards program. It is a key component of the Nation’s energy efficiency efforts and NEMA is committed to working with you

and the subcommittee to enhance these programs.

[The prepared statement of Mr. Gaddis follows:]
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Mr. BOUCHER. Thank you very much, Mr. Gaddis. Mr. Myers.

STATEMENT OF C. DAVID MYERS, VICE PRESIDENT, BUILDING

EFFICIENCY, JOHNSON CONTROLS, INC., MILWAUKEE, WI

Mr. MYERS. Thank you, Mr. Chairman, Ranking Member Hastert

and the members of the subcommittee. My name is Dave Myers.

I am President of the Building Efficiency business at Johnson Controls and I am here today on behalf of two associations, ARI and

GAMA. Thank you for inviting me.

Our organizations represent a domestic manufacturing industry

with combined shipments of over $50 billion annually, contributing

over $2.3 billion in positive trade balance. Our organizations manufacture furnaces, boilers, water heaters, heat pumps, air conditioners and refrigeration equipment for both residential and commercial applications. We have more than 240,000 American men

and women working in our companies. Our industry has long supported energy efficiency.

We joined forces with the public interest groups and the States

to work on the 1987 appliance efficiency law called NAECA. We

worked on national standards and a sensitive review schedule. We

were also at the table on putting together the Energy Policy Acts

of 1992 and 2005. Taken together, energy efficiency laws are based

on three concepts. First, initial national standards; second, periodic

reviews of those standards and third, pre-emption of State actions

that can result in a patchwork quilt, inconsistent with our national

policy.

Our current appliance efficiency policy has been quite effective,

but today’s policy debate threatens to depart from this effective

three-part effort. Recent discussion of regional standards is a clear

departure from an effective national policy on energy efficiency.

Such regional standards present four major challenges.

First, they produce great difficulties in enforcement. Today, original equipment manufacturers actually enforce meeting the standards for all products that are manufactured and we have certification programs in place to support that. In the future, with regional standards, it will require local contractors at individual site

installations to bear the burden of ensuring that all compliance is

met with regulations and standards. There is no resource or mechanism in place to do that today. There will be an incremental cost

to be able to support that and effectiveness will be a challenge.

Second, regional standards undermine the economies of scales in

our industry. Cost of manufacturers and the incremental cost of investment to manufacture will increase. There will be complexity of

the process and we will have to meet a wide variety of different

standards that may be in place.

Third, they will increase the cost to the consumer with disproportionate impact on those living on fixed incomes. It will include a

higher cost of enforcement; higher cost of production, as I just discussed; also, higher costs of installation and could take away economic choices of each individual consumer.

Fourth, and most importantly, in my mind, is they may even discourage turnover in existing appliances to upgrade to more efficient

products.
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Recently, our air conditioning industry adopted the 13 SEER

minimum standards in 2006. We immediately saw a 25 percent decline in new air conditioner sales with a corresponding increase of

25 percent in after market parts sales. Consumers were clearly

making a choice not to buy the more expensive efficient units and

chose to repair or maintain inefficient units in the marketplace. In

addition, there is also conflicting interests. For example, a landlord

who bears the cost of the initial new equipment purchase may

choose not to make that investment because the economic gain is

paid by the tenants who are paying the utility bills, so therefore

he will not see a direct correlation to the benefit of investing in

more expensive equipment that is more efficient.

In addition, although the DOE DOEs not have authority to prescribe regional standards, there is already a waiver process in place

for compelling cases. By contrast, Federal pre-emption, as envisioned in our efficiency laws, ensures predictability and consistency

in our regulations. Our industry has always supported substantial

progress and innovation in efficiency improvements. In fact, I view

them as the primary reasons we are leading in the U.S. marketplace, as well as competitive globally.

And with the impact of legislation of design, I also see a challenge in being able to compel innovation in our products if we get

into the specification of types of design in products. That said, we

must walk a fine line. Policies that create arbitrary distinctions

among States and regions and drive costs to consumers may run

at cross purposes to the policy objectives of energy efficiency.

In conclusion, much can be achieved and not just with the stick,

but with the carrot. We support sensible standard setting, but we

must have other policies to encourage installation of new, efficient

equipment. For action beyond the Federal standards, we must recommend tax incentives and education and certification programs.

One of the keys is also to improve the current process within DOE,

as Assistant Secretary Karsner pointed out.

For example, the Cool and Efficient Buildings Act in front of the

House now would provide an incentive to upgrade to new, more efficient equipment. We also support legislation of incentives to create a catalyst for homeowners to upgrade to more efficient products. We would also support an expedited process for adopting consensus agreements. We believe it is as critical to address the installed base of equipment as it is the new equipment and future

sales. In this way, I believe consumers, public interest, States and

industry can all win together. Thank you for your time.

[The prepared statement of Mr. Myers follows:]
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Mr. BOUCHER. Thank you very much, Mr. Myers. Mr. McGuire,

we will be happy to hear from you.

STATEMENT OF JOSEPH MCGUIRE, PRESIDENT, ASSOCIATION

OF HOME APPLIANCE MANUFACTURERS, WASHINGTON, DC

Mr. MCGUIRE. Thank you, Mr. Chairman and members of the

subcommittee. AHAM represents manufacturers of the vast majority of home appliances sold in the United States. AHAM members’

commitment to energy efficiency is evidenced by nearly 60 percent

decrease in clothes washer energy consumption, 47 percent refrigerator energy consumption decrease and the 38 percent drop in

dishwasher energy consumption since 1990. The National Appliance Energy Conservation Act provides the framework for appliance efficiency standards. Many AHAM products are covered by it,

including refrigerators, clothes washers, dryers, dishwashers,

ranges and ovens, room air conditioners and dehumidifiers.

Federal residential appliance standards that have gone into effect since 1988 or which will take effect by the end of this year will

save a cumulative total of 34 quads of energy by 2020 and 54 by

2030. Over half the energy savings are attributable to refrigerator

freezers currently in third generation standards and about to commence a rulemaking for fourth generation standards next year; and

clothes washers currently in third generation standards and which

will undergo a rulemaking for fourth generation standards very

soon.

In the case of DOE covered products produced by AHAM members, all products have gone through DOE appliance efficiency

standards rulemakings, while some, as mentioned above, have gone

through multiple regulatory proceedings. The same few full line

companies have absorbed much of the cost of the multiple

rulemakings and standards.

We believe there are two fundamental strengths of the current

program. The first is the process used to determine if appliance

standards are justified. The law requires DOE to determine if

standards will result in significant energy savings based on maximum technological feasibility. DOE must then determine if the potential energy savings will justify the resulting cost to consumers

and manufacturers and whether the standards result in the loss of

any product functionality or feature. The resources to complete

such analyses are difficult to find at the Federal level and even

harder at the State level.

The second strength is Federal pre-emption. It is the most effective way to achieve significant energy savings. NAECA was enacted

in response to the growing tendency of States to enact appliance

standard programs. While well-intentioned, these various State efforts were creating a vulcanization of the national market and forcing manufacturers to consider multiple product and manufacturing

lines. Consumers would be the losers in such a regime by bearing

the impact of increased costs of production. NAECA establishes a

process for States to seek exemptions from pre-emption if they can

show unusual and compelling circumstances.

AHAM opposes proposals to limit or suspend Federal preemption, such as when DOE determines that no standard is justified. We also oppose proposals to authorize DOE to establish re-
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gional standards for products. Such efforts would create the same

problems NAECA was meant to address. The Federal system DOEs

have it flaws. For example, in every administration resources have

been the Achilles heel of DOE standards office, but these instances

should not be the cause for abandoning the Federal approach in

going back to a State by State system.

AHAM believes there are steps to improve the current system,

including adequate funding for DOE. We also think DOE should revisit and strengthen its process improvement rule, which provided

a forum for all stakeholders to participate in priority setting. We

support DOE with the authority to abbreviate its rulemaking process if stakeholders have come to an agreement on a new efficiency

standard and Congress should be open to agreements negotiated

amongst stakeholders and appliance efficiency that might expedite

policy decisions and break new ground in environmental protection

and energy efficiency.

Mr. Chairman and members of the subcommittee, the agreement

that we are announcing today on multiple appliances seeks to legislate new appliance efficiency standards for several covered products, recommends to DOE and EPA that they adopt new strict Energy Star specifications for these products and seeks to extend the

manufacturers tax credit for super efficient appliances to more

products. A consensus based agreement also provides, for the first

time, national water efficiency standards for residential clothes

washers and dishwashers. This agreement also calls for new DOE

rulemakings for several products, including refrigerator freezers.

These new standards, when combined with the provisions of the

agreement I just mentioned, will result in total energy savings

ranging from 7.5 to nearly 15 quads, additional water savings of up

to 68 million acre feet and consumer utility savings will range from

$38 billion to $68 billion, depending on the cost justification of various standards options. We hope this agreement will be included in

committee legislation. On behalf of the appliance industry, we appreciate the opportunity to testify before the subcommittee and

would welcome your questions. Thank you very much.

[The prepared statement of Mr. McGuire follows:]
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Mr. BOUCHER. Thank you, Mr. McGuire. Mr. Johnson.

STATEMENT OF DOUGLAS JOHNSON, SENIOR DIRECTOR,

TECHNOLOGY POLICY AND INTERNATIONAL AFFAIRS, CONSUMER ELECTRONICS ASSOCIATION, ARLINGTON, VA

Mr. JOHNSON. Thank you, Chairman Boucher and Ranking Member Hastert and members of the committee. We commend the subcommittee for holding this hearing on the important issue of energy

efficiency and appreciate the opportunity to provide views of our

membership. Our members are committed to energy efficiency and

conservation and we have taken a comprehensive, multifaceted approach to addressing energy efficiency.

First, our industry understands its obligation to inform consumers about the energy needs of their products. This year we

launched a new consumer Web site called mygreenelectronics.org. In addition to pointing consumers toward electronics recycling options close to their homes, this site includes a number of tools

which enable consumers to identify and purchase energy efficient

products. We are very proud of this site and we urge you to pay

it a visit.

Promoting the use of industry-led standards for energy efficiency

is also critical. Recently, CEA developed two new industry standards for energy use in set top boxes. We also supported the development of a new standard for measuring power consumption in digital televisions, as the current decades old standard for measuring

power consumption is inappropriate for today’s DTVs.

Together, these voluntary standards initiatives transform the

market and deliver more energy efficient products to consumers

and businesses. We also have taken every opportunity to showcase

and promote energy efficient products. At January’s International

CES, the world’s largest annual trade show for consumer technology, we spotlighted the importance of energy efficiency and conservation, including displays of energy efficient products and technologies, conference sessions on energy efficiency and public policy

and design award for products.

In addition, CEA, in partnership with the Information Technology Industry Council is holding an energy efficiency product

technology demonstration on Capitol Hill on May 16 and we welcome your attendance. Finally, we have worked cooperatively with

government agencies to promote voluntary market oriented programs like Energy Star, which highlight and support energy efficient product design and purchasing.

As you know, the market for consumer electronics is dynamic,

highly competitive and characterized by rapid innovation, significant time-to-market pressures, rapid rates of market penetration,

rapid transformation from one technology to another. In this way,

our products are vastly different from the more established products, such as residential, industrial and commercial appliances.

Government industry partnerships like Energy Star provide the

flexibility, market orientation, competitive incentive and consumer

recognition that are necessary for our dynamic industry. Most importantly, Energy Star has had a long and established track record

of success, as measured by energy savings and reduced greenhouse

gas emissions. As the U.S. Environmental Protection Agency’s lat-
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est annual report on Energy Star indicates, the Energy Star program for consumer electronics and residential office equipment has

saved 18.8 kilowatt hours of energy and avoided emissions totaling

3.8 million metric tons of carbon equivalent. Since 1992, there have

been 1.1 billion purchases of Energy Star consumer electronics

products.

While these accomplishments are positive, we are deeply concerned by a recent increase in State legislative activity related to

appliance efficiency standards. Some of these bills have targeted

product categories not addressed by DOE standards, including external power supplies, also known as AC power adapters. So far,

seven States have enacted laws or regulations establishing energy

efficiency standard for external power supplies and others may

soon join them. This developing patchwork of inconsistent State

regulations is harmful to consumers and innovation.

Consumer electronics is a global industry with a global network

of supply and distribution. The existence of multiple requirements

across different States and regions creates design, manufacturing

and supply chain difficulties, harming efficiency and increasing the

cost of final products for consumers. For that reason, we urge quick

Federal action on establishing a national energy efficiency standard

for external power supplies. This is important not only to prevent

divergent State activity, but also to facilitate harmonization across

North America and internationally.

In conclusion, we believe this committee’s focus on energy efficiency is important and necessary. Electronics are a part of an energy saving solution. Home networking products help save energy

by providing increased control over home heating, lighting and

cooling systems. Information technology and telecommunications

products allow tele-working and remote access to information and

entertainment, which saves fuel and reduces greenhouse gas emissions. As policymakers consider programs and policies that support

the efficient use of energy, we urge Congress to support innovation

and promote consumer oriented initiatives like Energy Star, which

are the keys to energy efficiency achievements for the consumer

electronics industry.

Thank you again for this opportunity to share CEA’s position on

this important public policy issue. I look forward to addressing any

questions you may have.

[The prepared statement of Mr. Johnson follows:]
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Mr. BOUCHER. Thank you, Mr. Johnson. Mr. deLaski.

STATEMENT OF ANDREW DELASKI, EXECUTIVE DIRECTOR,

APPLIANCE STANDARDS AWARENESS PROJECT, BOSTON, MA

Mr. DELASKI. Mr. Chairman, Ranking Member Hastert, members

of the committee, my name is Andrew deLaski and I am the executive director of the Appliance Standards Awareness Project and I

have served in that capacity since 1999. ASAP is a coalition project

with a Steering Committee representing the energy efficiency organizations, consumer organizations, environmental organizations,

utility industry and State government. The Project works to advance cost-effective appliance and equipment efficiency standards

at both the State and Federal level.

Since 1999, I have been involved in every single major DOE appliance standards rulemaking process. I have also worked actively

on appliance standards at the State level in more than a dozen

States through both legislative and regulatory proceedings. Eleven

States have enacted or otherwise adopted various appliance and

equipment standards since 2004. This State action has prompted

renewed manufacturer interest in expansion of the Federal standards program. Standards first enacted by various States formed the

basis of the 15 consensus standards included in the Energy Policy

Act of 2005 and those consensus standards, I would submit, are

one of the biggest energy saving components of the 2005 act.

So I am deeply honored to be here today to have the opportunity

to share with the committee some of my views with respect to the

Federal program and some recommendations for how it might be

improved. In my oral testimony, I will first summarize some of the

current and potential impacts of the Federal appliance standards

program. I will next discuss DOE’s recent performance implementing the Federal appliance standards program and I will close with

some specific recommendations for legislative reforms. In my written testimony I address the seven specific questions the committee

raised in the invitation to testify today.

The Federal appliance standards program has delivered enormous energy and economic benefits since 1987. Analysis by the

American Council for Energy-Efficient Economy, one of the sponsors of my project, estimates that existing standards will save nearly 400 billion kilowatt hours per year by 2020. That is with on-theground-today standards already in place. These standards will cut

U.S. electricity use by approximately 9 percent from levels that

otherwise would have been reached. Already existing standards

will cut peak electricity demand by 144,000 megawatts by 2020.

That is the equivalent to the output of about 288 500 megawatt

power plants.

For consumers, the already existing standards on the ground

today have a net present value of approximately $234 billion. For

the environment, those savings translate to about 315 million metric tons less carbon dioxide emissions per year, about 4.5 percent

reduction of 2020 project emissions. These are big savings. However, DOE’s failure, as we have already heard today, to meet deadlines as documented by the GAO report, show that the savings are

smaller than what they should have been. The opportunity has

been even larger.
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DOE’s recent commitment to get the appliance standards program back on track by establishing firm deadlines and sticking to

them is good news. We estimate that by issuing new standards for

products which DOE already has the authority and the obligation

to review and set standards, DOE could add at least another 200

billion kilowatt hours in annual savings and cut carbon dioxide

emissions by another 165 million metric tons per year or about 2.2

percent of projected emissions for the year 2020.

But these savings will only be achieved if DOE establishes appropriately strong standards. Meeting a deadline is one important

goal, but you also have to set an appropriately strong standard. In

each of the three most recent proposals for new standards concerning home furnaces, home boilers and electric distribution transformers, DOE has issued weak standards. In the case of furnaces,

DOE has proposed a single national standard met, as mentioned in

Chairman Boucher’s opening comments, met by 99 percent of current sales. Notably, DOE rejected State calls for regional standards

in their proposed rule, saying they lack legal authority to set such

standards.

For boilers, DOE rejected a consensus agreement recommended

by manufacturers and advocacy organizations. With regard to

transformers, DOE has rejected a standard supported by the very

electric utility industry which purchase this equipment. In several

cases, DOE has indicated its hand are tied legally. If the law is the

problem, as DOE indicates, then Congress should clarify the law.

I am also heartened that DOE recently reopened the comment period with regard to transformers and appears to be looking at the

possibility of setting a stricter standard than originally proposed

for transformers.

Several reforms to the law are needed to help ensure that DOE

will be better able to capture the savings from cost effective standards in the future. We have six specific recommendations.

First, we recommend that Congress authorize DOE to establish

limited regional standards for heating and cooling products only.

The same furnace standard DOEs not make sense for Michigan as

makes sense for Mississippi, nor DOEs the same air conditioner

standard make sense for Georgia as makes sense for Sacramento.

The clear needs of different regions of the country should not be

subjugated to manufacturer preference to have a single national

pre-emptive standard. Regional standards for some products are

absolutely necessary to achieve the intent of the law to maximize

cost effective national energy savings.

Second, DOE should authorize DOE applied additional multiple

efficiency measures to a single product. A single measure is sometimes inadequate to represent a product’s energy consumption.

DOE should have greater flexibility to capture all aspects of a product’s energy consumption in its efficiency standards.

Congress should require DOE to conduct a furnace standard

rulemaking on a firm schedule. DOE has the authority to do this

now without a firm schedule. We are concerned this rulemaking

just won’t happen.

DOE also should review appliance standards on a regular basis.

As we heard, one of the principles of the statute is to set a standard and also require DOE to review these standards periodically.
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However, once these requirements are completed, then they are

going to be pre-empted, but there are no further reviews. We think

Congress should direct DOE to review all standards on a periodic

basis on a forward-going basis.

If DOE fails to review a standard, we believe that pre-emption

of State standards should sunset. The potential for pre-emption to

expire will dramatically increase the pressure for DOE and all

stakeholders to work diligently to ensure that we get adequate national standards. If deadlines are missed, authority should return

to the States.

And finally, I recommend that the Congress clarify that preemption only applies when there is a Federal standard. Federal

law should not pre-empt State standards in those instances where

DOE has failed to act or chosen not to exercise its authority. Congress should make clear that no Federal standards equals no Federal pre-emption.

This concludes my oral remarks. Thank you again for the opportunity to testify today.

[The prepared statement of Mr. deLaski follows:]
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Mr. BOUCHER. Thank you, Mr. deLaski. Mr. Harak.

STATEMENT OF CHARLES HARAK, NATIONAL CONSUMER LAW

CENTER, BOSTON, MA

Mr. HARAK. Thank you very much, Chairman Boucher, Ranking

Minority Member Hastert and members of the committee. My

name is Charles Harak. I am the senior attorney for the energy

project at the National Consumer Law Center. Throughout my 30

years as a lawyer, I have worked on energy issues almost exclusively on behalf of low-income consumers. Over the past 5 years,

NCLC has represented low-income consumers in some of the DOE

appliance dockets, as well as in two recent lawsuits. In these comments I want to underscore the importance to low-income consumers of adopting strong appliance efficiency standards, particularly

for boilers and furnaces. I will also highlight some areas where I

think the Department of Energy could do a better job in carrying

out the congressional mandate regarding appliance standards.

Households living in poverty spend 25 percent of their total

household income to pay for their energy bills. This is an unbearable burden. The unsurprising result is that ever-rising numbers of

households are having their gas and electric service terminated.

Many others live without heat because they cannot afford their propane or oil bills. For low-income households, applying efficiency

standards are much more than a way to save energy and reduce

harmful emissions. These standards could help families to stay

warm in the winter and cool in the summer and literally keep the

lights on by making the energy they need more affordable.

Strong appliance standards are uniquely important for the millions of low-income families who rent their dwellings. Property

owners, not renters, generally replace large household appliances,

such as furnaces, boilers and water heaters. Yet, these owners will

often install less expensive and less efficient appliances because the

tenants bear the higher energy costs of operating less efficient appliances. This so-called ‘‘split incentive’’ between property owners

and tenants must inform congressional and DOE policy regarding

standards for residential appliances.

While it is important to be aware of this problem of split incentives, appliance standards are also important for all consumers. Efficiency standards have had and will continue to have a significant

impact on overall energy consumption. Savings resulting from

adoption of stronger boiler and furnace standards alone would have

a measurable impact on the demand for natural gas, thus moderating expected future increases in the price of natural gas consumed

by households, businesses and industry, alike.

Low-income houses, in particular, benefit from any moderation in

the price of natural gas because they pay a disproportionate share

of their incomes for home energy bills and often face termination

of their service due to non-payment. The committee is obviously

well aware of DOE’s checkered history in implementing the appliance standards program. Here I would note that from the perspective of low-income consumers, the most important improvement

that Congress could make in the process is to provide DOE with

clear authority, if not an out-and-out mandate to adopt standards

for products that vary by climate region.
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Numerous parties in the DOE boiler and furnace docket that is

pending have urged DOE to adopt a two-tiered standard for gasfired furnaces. There is a consensus that a 90 percent efficiency

standard is economically justified in most States in the country.

DOE, however, flatly refuses to consider a two-tiered standard, relying on an unexplained parsing of the definition of ‘‘energy conservation standard’’ in the law. NCLC, along with several other

parties, presented DOE with a detailed legal analysis as to why,

in fact, it has the authority already to adopt a two-tiered standard

for furnaces. We also sent a letter to DOE Secretary Bodman urging him to pay personal attention to the agency’s position in the

furnace docket, regarding its authority to adopt a two-tiered standard for gas furnaces.

At the moment, however, it appears that DOE DOEs not intend

to change its position and will only consider a single weak standard

for the entire United States. Congress should carefully consider the

adoption of legislation to overcome this unnecessary obstacle to the

attainment of cost-effective energy savings. If Congress wishes to

clarify that DOE can adopt regional standards for any product

where this would best carry out congressional intent, NCLC attaches to this testimony proposed legislative changes, as well.

Congress should also consider mandating that DOE address the

issue of regional standards for furnaces promptly, within the next

18 months. DOE is unlikely to adopt a two-tiered standard in the

pending rulemaking that will probably end up later this year. The

weak nationwide standard proposals will not take effect until 2015,

14 years after it began considering revisions to the existing standards. Unless Congress mandates that DOE immediately revisit furnace standards, DOE may not implement new furnace standards

until 2020 or later. In the pending furnace docket, DOE has all of

the technical and economic information it would need to promptly

adopt a two-tiered furnace standard.

On behalf of the National Consumer Law Center, I thank the

committee for allowing me to testify today.

[The prepared statement of Mr. Harak follows:]
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Mr. BOUCHER. Well, thank you very much, Mr. Harak. You got

the award for timing. You were within 3 seconds of 5 minutes.

Mr. HARAK. I timed it before I got here, Mr. Boucher.

Mr. BOUCHER. Very well done. And I want to say thank you to

all of the witnesses for their well-prepared and delivered testimony

here this morning.

Mr. Karsner, let me begin my questions with you. You have mentioned, in your testimony, that certain new items of legislation

would be helpful in addressing problems that you perceive with the

existing statute and also giving you some helpful new regulatory

flexibility. Could you be more specific in what you are recommending to us?

Mr. KARSNER. Yes, sir, Mr. Chairman. Specifically, and it has

been mentioned by several people up here in their testimony, movement towards a consensus rule. Effectively, anything that we would

request for new legislation that would give the Department additional flexibility to compress the timetable. As has been said, it is

one thing to establish a critical path and bring some order to chaos;

it is another thing to be able to analyze that critical path and determine whether or not you can compress it in some logical way

that still has equitable fairness. We think moving to a consensus

rule, when all of the manufacturers, advocates, stakeholders and

all the relative parties are in agreement, expediting the process, is

quite important, so we have sent legislation to the Hill to that end.

Mr. BOUCHER. I understand that. What else?

Mr. KARSNER. Well, a lot that was mentioned here today are

things that are new. They would be either amendments to the existing EPCA or new in statute, but specifically, the potential for

considering different regions of the country and different climate

zones, giving DOE a greater latitude to look at design features in

addition to performance features. These are all things that we

would avail our technical expertise to the committee and be happy

to collaborate on.

Mr. BOUCHER. OK. Well, thank you very much. Let me suggest

that you send us a list of specific statutory changes that you think

would be appropriate for us to make. We are in the process now

of considering what changes to make and we are on a fairly short

timeframe in terms of reporting legislation for consideration by the

full House that will be on the floor in July of this year. So if you

could submit to us, within the coming 2 to 3 weeks, a list of proposals for legislation, that would be extremely helpful.

Let me ask a question for all of the witnesses. For the consensus

standards that have been developed specifically for clothes washers

and for dishwashers, I think Mr. McGuire described that new set

of consensus standards in his testimony, would everyone here agree

that we should codify those consensus standards by a statute and

do so in the near term? Any comment on that? Anyone opposed to

us doing that? Let us put it that way. I don’t see any hands. Well,

there is Dr. Rosenfeld.

Mr. ROSENFELD. I think the advocates have done a good job and

I reluctantly support it, but I do want to say California didn’t sign

on because the standards for water factor in clothes washers were

not up to what we need in the State of California.

Mr. BOUCHER. OK, thank you. Mr. deLaski.
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Mr. DELASKI. We are participating in those negotiations and

strongly support the recommendations that Mr. McGuire outlined

today. These, I think, the industry represents. We have had numerous negotiated agreements over the years. This latest, I think, is

the most global in terms of addressing multiple products and addressing both new standards for several products require new

rulemakings, as he mentioned, for clothes washers and refrigerators, tax credits for promoting the most efficient products.

Mr. BOUCHER. The precise question is should we incorporate

these consensus agreements in the statute?

Mr. DELASKI. Yes.

Mr. BOUCHER. Thank you, Mr. deLaski. Mr. Harak. Well, if you

disagree with that, tell me. If you don’t, let us pass on to another

question. We will assume that is the consensus view of the panel.

OK. The next question would be this. There has been an endorsement from at least Mr. Harak, Mr. Rosenfeld and Mr. deLaski that

we have regional standards with respect to heating and cooling

products and I would like to ask the entire panel if they would

agree that these regional standards should be limited just to heating and cooling products or would it be appropriate to have regional or other variable standards for other kinds of products, as

well? And if for other kinds of products, what other products? Who

would like to answer that? Dr. Rosenfeld.

Mr. ROSENFELD. Do I sound like the broken record? I just want

to remind you that water is very expensive in the West, which is

a region.

Mr. BOUCHER. Thank you. Yes, Mr. Harak.

Mr. HARAK. I would say at the moment those are the most important products and I think in the pending docket on boilers and

furnaces, it is extremely important to move forward on heating and

cooling products.

Mr. BOUCHER. So you would say limit it to heating and cooling,

at least for the time being?

Mr. HARAK. At the moment I am comfortable with that, yes.

Mr. BOUCHER. Would everyone agree we should limit that to

heating and cooling and not provide DOE with greater latitude in

order to set regional standards or other variable standards for

other kinds of products?

Mr. HARAK. If I could amend, it is hard to know when there

might be other products and if you were going to fix the law, if you

changed it in the way you suggest, you have made it even clearer

that maybe they don’t have authority on other products. I read the

current law that they have regional authority, but if you are going

the direction you are suggesting, you would need a further amendment of Congress if there were another product where its efficiency

and utility varies by region, the economic benefits vary by region.

I would be a little cautious.

Mr. BOUCHER. All right. Yes, Mr. McGuire.

Mr. MCGUIRE. Mr. Chairman, we would oppose extending it to

other products and we certainly do not support it covering heating

and cooling products, although those are not my products, I think

it is the gentleman next to me, but we think the national standard,

which takes into account national energy savings and the features

and functionality of the products is a tested and true process and
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I think we need to leave it to the innovation of the product manufacturers to work within a performance standard to deliver the energy efficiency and performance that they can do.

Mr. BOUCHER. Mr. Myers.

Mr. MYERS. Mr. Chairman, I guess I would support the national

structure, even though we specifically are talking about heating

and cooling products here. I guess I would point out that consumers are making choices, even within regions. More than two-thirds

of the furnaces now sold in the Northeast are at levels above inefficiency, above the minimum standards, so we are making economic

sense. The consumers are choosing to do so.

Mr. BOUCHER. Well, let me just ask both of you this question. If

we were to have, I think, perhaps, it was Dr. Rosenfeld who suggested two regions, a North region, a South region. He nods and

says it was him. How much added burden to you would that be?

You are manufacturing to two standards instead of one. Surely,

that would not be an enormous additional burden, wouldn’t it?

Mr. MYERS. I think, from a manufacturing perspective, perhaps

not, but I think the effectiveness of the standard in those two regions would result in minimal benefit in the overall cost structure.

I think when you talk about the ability to enforce it, the compliance, it moves it from centralized product certification and management within the OEMs and imported products to the field. Do they

have the resources to enforce it? Can they verify each installation?

Is operating within the conditions set for that particular region?

I think you have the practical side of legislation. We are very ineffective from the standpoint of timing and the processes we have

described here with the DOE. Now we are going to do it with two

separate activities that might have complete processes individually

done by region that only burdens it further. And I think we have

demonstrated where national standards have been passed, they are

very effective and we are achieving the standards. I guess the last

point I would make is——

Mr. BOUCHER. Well, my time has long expired, but let me just

say that an argument has been presented that I think deserves our

consideration, that with regard to heating and cooling in particular,

where we do have different functionalities that perhaps should

apply in different climates, that a different standard, perhaps,

would be sensible within that very limited context and I think

what we have heard from our witnesses is that the limit for that

context would, in fact, be heating and cooling and not anything

broader. And as much as I would like to call on you, Dr. Rosenfeld,

I simply don’t have the time to do it. He is going to say water, anyway. No, no. He is not. Well, in that case, with the indulgence of

my colleague from Illinois, let me ask you, then, Dr. Rosenfeld,

what you do have in mind?

Mr. ROSENFELD. I just want to point out, with respect to the

problem of heating and cooling that in California we have 16 climate zones, compared to just one for the country, is a little pathetic. And we require better windows in some climate zones than

in others and there isn’t any problem with administering this. We

have Low-E windows required in some climate zones and not in

others and it all works fine.
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Mr. BOUCHER. All right. Thank you, Dr. Rosenfeld. The gentleman from Illinois, Mr. Hastert, is recognized for 5 minutes.

Mr. HASTERT. I thank the chairman. First of all, I would entertain a UC request.

Mr. BOUCHER. Oh, yes. I ask unanimous consent to include in the

record of today’s proceedings the statement of the chairman of the

full committee, Mr. Dingell.

Mr. HASTERT. Without objection.

Mr. BOUCHER. So ordered.

[The prepared statement of Mr. Dingell follows:]

PREPARED STATEMENT OF HON. JOHN D. DINGELL, A REPRESENTATIVE IN CONGRESS

FROM THE STATE OF MICHIGAN

Mr. Chairman, thank you for calling this hearing on the Federal program that

establishes energy efficiency standards for appliances. As one who participated in

enacting the Energy Policy and Conservation Act of 1975 that originally created this

important program, I am perhaps more conscious than most of the degree to which

we have wasted the opportunity to save energy from increased appliance efficiency

in the 32 years since then.

Thirty percent of our electricity demand is attributable to residential electric appliances, which makes them indirectly responsible for about 15 percent of our national carbon dioxide emissions. We have improved their energy efficiency significantly without loss of performance, indeed with better performance. But we could

have done so much better if we had adopted timely standards that met the statutory

test of requiring the energy efficiency that was ‘‘technologically feasible’’ and ‘‘economically justified.’’

In March, we released the Government Accountability Office report on this topic

that Chairman Boucher, Chairman Markey, and I had requested, as Chairman Boucher has already noted. The track record of this program has been a long series of

derailments or trains that never left the station. I can think of no other critical energy program that has such a long history of failure to meet its objectives.

Now, however, we are seeing the early signs of new and effective leadership from

Assistant Secretary Karsner, who is here to testify this morning. He has told us

that he can and will meet the current deadlines for new standards. We will help

him keep his promise.

But setting standards is only half the necessary commitment. They must also be

the right standards. They must strike a demanding balance between first cost, cost

of operation, and technical features to minimize energy consumption. In this way,

our household appliances can help make a major contribution to meeting our climate challenge.

I appreciate the fact that the efficiency advocates and the appliance manufacturers have many times been able to find consensus on new standards, saving the time

and uncertainties of waiting out the Department of Energy’s rulemaking process.

This is one way to get there, and we need to encourage more such consensus agreements.

We also need to review where changes in DOE’s rulemaking process will lead to

more effective implementation. I for one am ready to move quickly on legislative recommendations that emerge from this review. It has been 32 years since this program started; I would like to see DOE implementation fully up-to-date for all covered appliances.

For all of these purposes, this is a timely and important hearing, and I thank

Chairman Boucher and the subcommittee for undertaking it.

Mr. HASTERT. Thank you, Mr. Chairman. I came into this hearing and I am kind of jumping into this stuff from another world

in the last 6 months, but I thought this was kind of an esoteric

hearing, in a sense, and talking about standards and as I listen

and go through this, it is somewhat of a conundrum because I have

a base philosophy that economics drives behavior, especially what

people buy. For instance, I am involved with building a house in

southern Wisconsin. My brother sells heating and air conditioning

equipment in northern Illinois, yet the products that he rec-
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ommends in northern Illinois are completely different from southern Wisconsin, only 100 miles apart, but the weather is different.

And so the products that that market demands are completely

different or not completely, but there is a variation from the products that people in northern Illinois need and what is economically

viable. And I understand if you move to northern Wisconsin or into

Minnesota, those again, products are different. We are building a

house to an R28 level. You don’t have to build houses in other

places to R28. But the variation of wind and temperature and other

things demand or show that economically, that is a viable thing to

do.

So here we are saying how DOEs the DOE set more rules and

more regulations in an effective way? And of course, I have been

in the rule and regulation business now, I am sorry to say, for almost a quarter of a century, more than that. And sometimes rules

and regulations work, but I found mostly that government lags behind what the industry can offer. And so if the government regulation becomes a ceiling instead of a floor of what can be offered, I

see we enter ourselves into a conundrum. We are saying we are

limiting what our efficiency could be because we are just meeting

the standards.

Now, I understand that if we get in a situation and I think that

is a very good point that Mr. Harak brings out, that if landlords

are buying the equipment, they have a different economic view of

this than consumers do and he rightly supports the consumers. My

question is how do you make it economically feasible for a landlord

or the base consumer of the product to buy the most efficient product to build his house or his apartment building in the most efficient way or to remodel to make those efficiencies apparent? And

this is the bottom line. How do we change behavior?

And I just have to come back, if it is economically feasible, if it

pays, if it make economic sense, that is what is going to drive this

issue, so all you folks that represent industries, you have these regulations that you are going to have to deal with, I don’t know if

anybody here represents a company, per se, except for maybe Johnson Controls, that you know, you are there representing the consensus of a lot of ideas from a lot of people. But the fact is, what

is the best way to make and to deliver something that is really effective and really cost-efficient in two things?

We want to lower our energy demand and of course, a lot of this

energy comes from off-shore. If the generation is generated like it

is in the northeast, by fuel, or it is more effective and more efficient

to lower energy demand, period, because we are putting less CO2

into the air and other things that are important today. Mr. Harak,

what you recommend?

Mr. HARAK. Mr. Hastert, you raise a lot of very interesting points

and I made a few notes. I want to go through them briefly. First

is to the ceiling and floor issue. I think it would be very fair to say

that DOE is setting a floor, not an irrationally low floor, but there

is this ceiling or this range way above it through the Energy Star

program. Whenever DOE sets a standard for a product, there are

still many products on the market that are more efficient and then

there are incentive programs that layer on top of the DOE mini-
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mum standard. So I don’t think we are setting a ceiling that stifles

technology.

And the counter-example I can think of to what the market can

do on its own, compact fluorescent bulbs use 75 percent less energy

than the incandescents, but they don’t penetrate the market very

much in the United States, at least. Penetrate the market much

more significantly in all the other industrialized economies, so

there are things that don’t work in the market very well and consumers knowing enough to make choices.

Mr. HASTERT. But let me counter that. I have a company in my

district that has a terrible time trying to penetrate the market. You

know why? Because traditional light bulb companies want to be

able to change the lights every year. They don’t want to put a light

into the socket that is going to be there 10 or 15 years. It is not

economically viable for them. So how do you turn that thing

around?

Mr. HARAK. Well, the problem is that is inefficient for our economy that is spending dollars on energy in our economy that could

go to other productive uses are a drag on our economy and I think

Dr. Rosenfeld gave us some great examples of the magnitude of

that, so we don’t want to be dragging our economy with inefficient

expenditures. The landlord/tenant example, it is a tough one to

wrestle with. I would say, as someone who represents low-income

tenants, if the landlord had to and could calculate to the penny

how much the rent or the sale price of that unit goes up, it pays

back so quickly that the tenants are better off and we need to drive

those decisions.

Mr. HASTERT. Simple answer is make the landlords pay the utilities and take it out of that, but anyway.

Mr. HARAK. Well, that is another hearing we can do someday.

Mr. HASTERT. Mr. Rosenfeld, very quickly. Comment.

Mr. ROSENFELD. I support your general support of regional

standards. And I believe that with respect to the landlord/tenant

problem, our belief in California is make the landlord install an efficient appliance. He knows that there will be a short payback

time. It makes his property more attractive.

Mr. HASTERT. Thank you, thank you. I yield back, sir.

Mr. BOUCHER. Thank you very much, Mr. Hastert. The gentleman from Utah, Mr. Matheson, is recognized for 8 minutes.

Mr. MATHESON. Thank you, Mr. Chairman. Dr. Rosenfeld, as

someone who represents the second most arid State in the country,

I appreciate your reference to water efficiency and I want to start

with a question for you. In your testimony you advocated for the

regional standards and you have heard some of the—in fact, you

have also said that States may be able to develop their own standards in case DOE misses deadlines. How do you reconcile this with

the issues raised by the manufacturing sector about how they deal

with the cost issue of multiple jurisdictions and multiple sets of

rules?

Mr. ROSENFELD. I think that the manufacturers have really already dealt with this. We already heard Mr. Boucher say and corroborated that the efficiency of furnaces sold in cold States way

outweighs the standards. The standards are left in the dust. And

these are huge markets. We are talking, even if we break the coun-
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try into three air conditioning regions, we are talking about 80 million customers in each of these regions. I don’t see any problem

with the manufacturers going for individual markets for 80 million

people.

Mr. MATHESON. Mr. deLaski, you made a number of very interesting recommendations in your testimony. I noticed in the table

in your testimony where you looked at potential savings from DOE

rulemakings, you raised the issue of furnace fans and at least on

percentage, it is your highest one on your list and yet, you also

pointed out, in your testimony, that we don’t seem to have progress

on furnace fan rulemaking with the DOE. Could you tell us why

that hasn’t been happening?

Mr. DELASKI. A furnace, obviously, uses natural gas or oil to create heat, but then you have got to get that heat to where people

need it, through both a fan and a motor to blow it into the home.

That fan system is one of the largest single electricity uses in most

homes. It is an aspect of energy consumption that currently has no

standard whatsoever. DOE has determined that it will only set a

standard that addresses the efficiency with which the furnace

turns the oil into heat, the heating aspect of it. And Congress, in

2005, gave DOE authority, in the Energy Policy Act, to address furnace fans. DOE said subsequently, we are not going to do it, we

got the voluntary, so we are not going to do it until we don’t know

when. So we think that Congress should set a deadline to address

that.

Mr. MATHESON. Mr. Karsner, is that DOE’s position, that it is

not—or is there confusion at DOE about whether or not you are

able to set more than one performance standard for a particular

appliance?

Mr. KARSNER. I wouldn’t say there is confusion. I think the Office

of General Counsel has taken the position, from interpreting the

statute, that DOE DOEs not presently have that authority to set

multiple standards at the same time in that way.

Mr. MATHESON. OK. Mr. Chairman, it looks like that is an issue

we get to look at, then, if that is the case, because it seems like

there is some low-hanging fruit here that we are avoiding on the

furnace fan issue, to say the least.

Next question I would like to ask is, Mr. Karsner, we have talked

about the delays and we have talked about the challenges that face

DOE, my question for you is when DOE develops internally its

technical expertise that is necessary for evaluating these efficiency

standards, is all that work done in-house or do you work with other

Federal agencies, such as NIST, in terms of finding technical expertise to deal with these issues?

Mr. KARSNER. Let me revert back to the record to the extent that

we cooperate with NIST and the other agencies. My impression is

that we do, but it is not all in-house in the sense it is largely driven by outside contractors predominantly through our national laboratories. NIST, EPA and other agencies use DOE’s national laboratory system, so I am not sure to what degree we credit where

the collaboration lies.

Mr. MATHESON. Right.
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Mr. KARSNER. But generally speaking, there is inter-agency collaboration and a great deal is done out of the house, predominantly

through the national laboratory system.

Mr. MATHESON. Do you think that we ought to be looking at

ways to encourage a more fluid and efficient inter-agency process

to help expedite your process? I am on the Science Committee, too.

I think, just for example, NIST is a very solid organization. Are

there things Congress needs to do to make that inter-agency process work better, do you think?

Mr. KARSNER. Yes, I do think that there are things that could be

helpful that Congress could do.

Mr. MATHESON. I know our chairman asked you for some suggestions on legislation and I might throw that on the list, as well. I

am not trying to gum up the works, if there is a more efficient way

to create that cooperation, I think there is a real talent pool in

some of these agencies that might be able to really help the process

and eliminate some of the backlog.

Mr. KARSNER. I think that is worth examining.

Mr. MATHESON. Next question I wanted to ask has to do with—

a very general question for Mr. Karsner. We have again heard

about the problems with delays. Do you have the staff and budgetary resources now to make up the backlogs and also take on the

new requirements of EPAct 2005? What is your sense right now of

your resource capability and is there something Congress needs to

do to adjust that?

Mr. KARSNER. Well, in fact, we have substantially increased our

budget in these areas, about 66 percent over the last 2 years, so

it is an enormous bump in budgets, so now we are going to allocate

as we increase and mobilize resources and staff, so it begins with

additional contractors, probably additional Federal employees, so

there is a little bit of a lag time in terms of what the effect is from

the increased budget but yes, the answer is we are allocating substantially more resources that will translate into human resources,

as well.

Mr. MATHESON. I just submit that I think there is general consensus we want you to be able to do this in a timely way and if

you think that there are different resource requirements, I think

communicating that to us would be really helpful, as well.

Mr. KARSNER. If I could follow on your last question. NIST is, in

fact, a primary developer of some of our test procedures and we

fund that.

Mr. MATHESON. That is good to know. Last question. On the

GAO report, it listed a conclusion that there are some program

management practices that perhaps are lacking at DOE to ensure

the program is kept up to date and it also lacks, as well, DOE lacks

the data to analyze root causes of its own administrative problems.

Do you agree with that GAO conclusion and if you do, what steps

are being taken now to address that deficiency?

Mr. KARSNER. I agree with that conclusion for the period that

was covered under the GAO report, which DOEs not take account

of any of what we have done in the past year and so it is a little

bit like your stockbroker. Past performance is not a reliable indicator of future results. And so we take that report very seriously. We

have taken those recommendations and fundamentally put in a
146

great deal more of time management tools and tracking procedures

and high priority correspondence and management attention.

And so all of these things combined, which we would be happy

to provide in greater detail, but all of these things combined have

meant we have had a very different record in the past year than

we have in the past 30 years, namely that we have met all of our

scheduled deadlines. So we think, empirically, the new reforms we

put in place are working, are having effect. It is not to say they

are perfect yet. I think they will take years to perfect, but we think

we are on the right track.

Mr. MATHESON. I want to thank the whole panel. I thought the

testimonies have been really excellent today and Mr. Chairman, I

yield back.

Mr. BOUCHER. Thank you very much, Mr. Matheson. The gentleman from Texas, Mr. Barton, the ranking member of the full

committee, is recognized for 5 minutes.

Mr. BARTON. Thank you, Mr. Chairman. It is a measure of our

affection for you that we are here on a day that we don’t have votes

until three o’clock.

Mr. BOUCHER. I am very grateful.

Mr. BARTON. My first question is to you, Mr. Karsner. Is there

any relative of mine in the Department that is giving you a problem meeting these deadlines?

Mr. KARSNER. Not as yet, sir, but I will be happy to report back

in the event that that changes.

Mr. BARTON. If you have any problems, let me know.

Mr. KARSNER. Yes, sir.

Mr. BARTON. I was a White House fellow in the Department of

Energy in 1981 and 1982. This was in the first year of the Reagan

administration. In the Carter administration there were a number

of energy efficiency statutes passed, some of which required setting

standards for appliances. In the Reagan administration, in the

early years, set a no-standards standard. They decided to let the

market set the standard, so they officially set a standard of having

no standard. That was ultimately overturned and result is what we

see here.

Before we get too excited, though, about some of these standards,

and I am supportive of where it makes sense setting standards,

certainly setting regional standards. I think it needs to be said, Mr.

Chairman, that if you look down the list that is in our memo, hearing memo, where the right-hand column says consensus pending,

out of approximately 20 appliances, I only see five yeses. I see a

lot of no’s. Now, I don’t think you blame the Department of Energy

if there is no consensus.

So my first question is going to be to Mr. Gaddis. Why do we not

have a consensus on clothes dryers, for example?

Mr. GADDIS. Well, sir, let me redirect that. I don’t handle clothes

dryers. That is Mr. McGuire.

Mr. BARTON. OK. Mr. McGuire.

Mr. MCGUIRE. Thank you.

Mr. BARTON. Maybe that is why we don’t have consensus.

Mr. MCGUIRE. Mr. Barton, thank you for your question. I think

the question you ask is very important because it illuminates the

conflict we have with the priority setting of DOE and some of the
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statutory deadlines. In other words, the process improvement rule,

which used to be used brought all the stakeholders together to get

consensus on priorities for standards rulemakings which the DOE

would then review and adopt, high, medium and low. In low, what

is an area where no resources would be expended? Everybody involved, advocates, industry, States, agree with this process and priority setting, yet if something was in the low world, it could kick

in a statutory deadline problem.

When we had an agreement in 2000 for new clothes washer

standards that the advocates and States supported, energy efficiency standards for clothes washers, the modified energy factor

was so stringent that clothes going into the dryer were much drier,

that everyone agreed that there was no need to upgrade the dryer

standard that was in effect, even though there was a statutory

deadline requiring it. There was no appreciable energy savings.

And so DOE did not act, because they had other priorities, so I

think, in terms of the Congress dealing with the problems here, one

of the issues is the priority setting and the statutory deadlines

sometimes conflict.

Mr. BARTON. Well, I don’t want to overdo it, but there is a reason

that it has been difficult to set these standards on consensus and

that is because we have got a very diverse economy and we have

diverse climate in our country. An air conditioner standard

DOEsn’t need to be the same in Maine as it is in Texas and when

you set a high standard, you are going to almost always, not always, but almost always set a higher cost which makes it much

more difficult for low-income constituents to purchase that particular appliance. Now, some of these pool heaters—I don’t give a damn

what the standard is on pool heaters. If you got the money to buy

a swimming pool, you ought to be able to have the money to spend

whatever it takes to heat the pool.

Certainly, our former Vice President, Al Gore, can spend the

money at his pool down in Tennessee, no problem. But refrigerators, washing machines, there are a lot of these appliances that

really impact everyday Americans and we do need to get those

right, so Mr. Chairman, I will be very supportive of wading into

this and where a statutory deadline or a regional standard makes

some sense, I am more than willing to be supportive of your efforts

to try to simplify the process, but I don’t want to shortchange the

consumers of America and I want to reiterate what Speaker

Hastert said, doing something on a regional basis, although I know

that it is more difficult on the manufacturer because you have got

to manufacture to more than one standard, would seem to me, in

some of the more high ticket items, to make some sense. And with

that I would thank our panel and yield back.

Mr. BOUCHER. Thank you very much, Mr. Barton, and we look

forward to working with you and all the members of the subcommittee as we address these issues. The gentle lady from Wisconsin, Ms. Baldwin, is recognized for 5 minutes.

Ms. BALDWIN. Thank you, Mr. Chairman, and I thank the witnesses today. I am interested in the issue of standby power and I

understand standby power to be defined as the electricity consumed by end use electrical equipment when it is switched off or

not performing its main function. I can do a little survey of my own
148

home in Madison, Wisconsin and see all sorts of examples of that;

microwave that has the time on even if you are not actively using

it; the oven, the coffeemaker; certainly, in the family room, the TV,

the receiver, CD player, et cetera. And I understand that by some

estimates, as much as 10 percent of household power consumption

comes through standby power.

I am interested that it has been regulated only in one State and

that the regulation imposed by the California Energy Commission

is an example we can look to. And so I would start with Dr.

Rosenfeld. If you could please discuss how the standard came about

and do you have any data or figures yet for how much energy has

been saved due to this particular regulation? And also, have you

had any documentation of consumer complaints about a difference

in functionality of any product by virtue of the standby regulations

that California has imposed?

Mr. ROSENFELD. Thank you. I have two different remarks. First

of all, just quantitatively, what California has done is to reduce the

power of external power supplies, that is the little vampires that

plug into your wall and have two teeth and suck electricity all the

time, from typically 2 or 3 watts to under half a watt at which

stage they are still giving you all those services. Your coffeepot can

work fine, your microwave clock can work fine. What we discovered

is that these power supplies, which typically cost under a dollar at

3 watts cost maybe an additional 3 to 5 cents if you take them

down to half a watt.

We used to think that the payback time was measured in

months. In fact, my senior advisor, John Wilson, spent some time

in Taiwan and China, where most of these are made, and the manufacturer said they weren’t going to raise the price at all, it was

insignificant. So I think we have done a good job. I think it should

be taken over by DOE. We only did it because DOE was asleep at

the switch.

Second, however, I think modern thinking says that we could improve the way we address standby. Right now the external power

supply business is taken care of. Now there remains the standby

power of individual items; TVs, set top boxes, Dust Busters, whatever. We are beginning to think that what we want is a horizontal

approach in which all products shall have a standby power of less

than half a watt, unless they are a covered product which has been

worked out by DOE or by California. Or unless there are obvious

exemptions. If a set top box just can’t do it, let it apply for why

they can’t do it. But in general, keep standby power under half a

watt and you will get the services. You asked about reduction in

services. I don’t know of any reduction in services.

Ms. BALDWIN. Thank you. For Mr. Karsner, I would like to inquire about the Department of Energy’s involvement in this area.

Have you performed any studies to determine how large of a problem standby power is and if you want to comment, I know that provisions in EPAct has served to involve you in battery chargers and

external power supplies in terms of studying and making recommendations, but I am also interested in your involvement in

studying the standby power consumed by other products.

Mr. KARSNER. Yes, ma’am. In fact, I think most of the basis of

the work that Art is referring to in California comes out of DOE’s
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national laboratories, in particular, Lawrence Berkeley National

Laboratory and we do have what you would call, for lack of a better

name, a center of excellence study of the issue and for the most

part, today, we include standby power as an integrated part of the

whole appliance and it is not broken apart, as opposed to where

you might have a laptop computer with an external battery charger

that you could rate separately and independently, so in fact, the

technology DOEs exist.

That was the basis for California moving forward on it and we

have an obligation to study and make a determination whether it

is worthy to make a separate standard nationally for standby

power, as many of the advocates are claiming they would like. I

think the manufacturers also need to weigh in and determine what

will be the net cost impact of separating that out. It is important,

also, to note that regulation is one of the tools that the Department

has.

We also are very active, when it comes to efficiency, in terms of

regulation, market transformation, demand pool activities like Energy Star, and one of those demand pool activities would be our

Federal energy management programs, so that when President

Bush was made aware of this vampire electricity or the standby

power problem 5 years ago, one of the biggest leaps, rather, that

occurred in the sector was the President including it in an Executive order that made the Federal Government purchase only low

power, standby power appliances and that, in fact, was the greatest

movement for manufacturing of new low standby power.

Ms. BALDWIN. I see that I have run out of time, so I will yield

back.

Mr. BOUCHER. Well, thank you very much for those very thoughtful questions. The gentleman from Oregon, Mr. Walden, is recognized for 8 minutes.

Mr. WALDEN. Thank you, Mr. Chairman. Mr. Karsner, let me follow up on that last comment you made about President Bush ordering Federal agencies to use the low power transformers. Then

where DOEs the Department of Energy go from there? Did you all

move to try and set standards nationally, then, for those vampire

power supplies?

Mr. KARSNER. As mentioned, there are almost, there are two separate categories, really. There are those that are external to the appliance and those that are built in and integrated.

Mr. WALDEN. Right.

Mr. KARSNER. We are not presently moving on those that are external and integrated because we rate it in the overall efficiency of

the appliance, the net efficiency of the appliance, so whatever that

standby power consumption is, 3 watts, 10 watts, 1 watt, it comes

out in the whole of the appliance.

Mr. WALDEN. Then why did it matter for an Executive order to

do it Government-wide, then? Wouldn’t the same appliance be regulated the same way?

Mr. KARSNER. I believe that the Government order was just for

the external power, but I can revert on that for the record.

Mr. WALDEN. OK, but I guess what I am trying to get at is there

a Federal regulation regulating the vampire supplies?

Mr. KARSNER. There is not.
150

Mr. WALDEN. Do you have legislative authority to promulgate

one?

Mr. KARSNER. I believe that we do and that we have a scheduled

determination and analysis in August of next year.

Mr. WALDEN. Why DOEs it take that long?

Mr. KARSNER. Well, I mean, they all take approximately the

same time. It is just that we have so many of them that we have

a specific schedule that we intend to stay on.

Mr. WALDEN. I guess the point I am trying to make is if the

President thought it was important enough, and I concur with him,

to issue an Executive order saying Federal Government-wide, this

is something we can do right now and that there is a standard or

at least these are in the market, wouldn’t that be a pretty easy one

to move forward on?

Mr. KARSNER. Well, I mean, it goes to the whole question of the

latitude of an Executive order. The President has ordered that 75

percent of all our fleet operate on flex fuel and we meet and comply

with that in the Federal Government. I am not sure that that is

tantamount to making a national regulation for the same thing,

but it is up to Congress to consider that. With the authorities that

we have, FEMP, Federal Energy Management Program, advising

the Executive orders for implementation and moving the market is

one tool we have, it has been quite effective. National regulations

and that process that takes 36 to 56 months is something very separate.

Mr. WALDEN. I guess that is the next question I would like to get

to and perhaps Dr. Rosenfeld can address this. How was California

able to move so rapidly to make these decisions and the Federal

Government—and I am not picking on the people, I deal with these

issues on a lot of different realms. How fast DOEs it take you to

make a decision like that in California?

Mr. ROSENFELD. Since 2005, as I mentioned in my testimony, we

have adopted and passed 44 standards during the time when completed standards, the DOE has done none.

Mr. WALDEN. So Mr. Karsner, why DOEs it take DOE so long?

What is different?

Mr. KARSNER. DOE operates under statutes promulgated by Congress.

Mr. WALDEN. I am sorry.

Mr. KARSNER. And the State of California——

Mr. WALDEN. How can we fix that?

Mr. KARSNER. Well, as I suggested to the chairman, we would be

happy to, as we have on the Senate side, offer technical drafting

assistance as you move forward with your legislative proposals in

the coming weeks. There is an enormous amount of things that

could be done creatively. Some of them have been talked about

today. But in general, anything that compresses our timetable,

shaves time, offers more flexibility to the Department, greater latitude of interpretation, all of those things will be consideration of

the different——

Mr. WALDEN. Have you thought of just subcontracting to California?
151

Mr. KARSNER. Typically, when people have trouble in California,

they sue the Federal Government and so California has all the up

side, very little to the down side and it is a very special place.

Mr. WALDEN. Remember I am just from north of there. We are

very aware of that.

Mr. ROSENFELD. Can I actually support Andy Karsner? DOE is

simply humbled with an awful lot of very time consuming constraints.

Mr. WALDEN. That is what I am trying to get to.

Mr. ROSENFELD. One of the things I didn’t say exclusively that

is in my testimony, is there is a process in which you issue an advance NOPR, Notice of Proposed Rulemaking.

Mr. WALDEN. Right.

Mr. ROSENFELD. And there is a certain delay in the comment period and then you have an NOPR. I don’t see, it is you folks, Congress, who passed all that, but I think you could streamline the

process a lot.

Mr. WALDEN. And still allow for public involvement.

Mr. ROSENFELD. Oh, yes. I mean, I think, in California we work

ourselves to death on public workshops and almost always these

people who are here on the panel have been in the CEC building

defending their point of view. I think we do that part of it very

well, but there are just an awful lot of administrative things that

Andy has to take care of. He sends things off to OMB and has to

wait for I don’t know how many months to get concurrence.

Mr. WALDEN. He can’t tell us. He can’t talk badly about OMB.

Mr. JOHNSON. If I could jump in here?

Mr. WALDEN. Yes, Mr. Johnson.

Mr. JOHNSON. We spend a lot of time in Sacramento, as well as

Washington working with DOE, as well as the California Energy

Commission. The Consumer Electronics Association would support

an expedited treatment of external power supplies. There is a rulemaking that has been started as a result of the legislation of 2005

on external power supplies and battery chargers. However, the

timeline, as it would progress, could go to 2013. That is too long.

We need a solution now for external power supplies. Seven States

have acted in this area. We are ready to achieve it with all relevant

stakeholders and we would look forward to it, as we have said in

our testimony.

Mr. WALDEN. Would you support that same sort of expedited

process across all these issues involving energy efficiency, give the

Department the ability to move more rapidly while still allowing

for public input?

Mr. JOHNSON. I think a number of parties here have perspectives

on that, but we certainly, for external power supplies, support,

whether it is through legislation or changing the rules of DOE and

expedited treatment of rulemaking for external power supplies.

Mr. WALDEN. All right, so only for external power supplies.

Mr. JOHNSON. There is a great opportunity there.

Mr. WALDEN. Yes, right. All right, Mr. McGuire.

Mr. MCGUIRE. If I could just add, we would support an expedited

process and one of the ways to do that, I think, is to revisit this

process improvement rule where the stakeholders were involved in

prioritization and when those priorities bump up against the statu-
152

tory deadlines, even though the people with knowledge know what

the priorities are to be, then maybe that is an area for the committee to look at, whether the statutory deadlines are impeding

progress.

I think another thing that is important to keep in mind at the

Federal level versus the State level, is the quality of analysis that

NIST, in developing the test procedures in the Federal labs and in

doing analysis can do with the resources they are given and I think

the States, even California, DOEsn’t have the ability to conduct as

thorough an analysis and sometimes has to resort to stakeholders

doing the analysis, which I don’t think is right.

Mr. WALDEN. So is NIST the holdup?

Mr. MCGUIRE. No, I don’t think NIST is the holdup and I don’t

think the Federal labs are the holdup. I think the holdup involves

more DOE process in some of the funding, in some of the statutory

deadlines which really probably don’t make sense compared to

some of the prioritization, like for example, clothes dryers. They

missed statutory deadlines. Nobody in the advocacy community or

industry felt the standards needed to be upgraded because the

clothes washers are spinning out the clothes dry.

Mr. WALDEN. DOEs anybody ever come back to us and say you

don’t need that statutory deadline on this?

Mr. MCGUIRE. I would like to say so today, at least.

Mr. WALDEN. Well, yes. When was that deadline, 2005 did you

say? What was the statutory deadline for clothes dryers?

Mr. MCGUIRE. Clothes dryers, I don’t know offhand. It was previous to 2005. But in 2000, I think the deadline was in the late

1990’s and 2000.

Mr. WALDEN. What I am hearing in the GAO report is these

deadlines we put in law are ignored anyway, right? Isn’t that what

the GAO report found? Mr. Karsner, am I missing something?

Mr. KARSNER. I don’t know that it found that they were ignored.

I think it found that they were underperformed.

Mr. WALDEN. All right. So then we are at fault. All right.

So I am doing 75 in a 55, I was just over-performing, right? All

right, my time is up. Thank you.

Mr. KARSNER. I think what Mr. McGuire is referring to is the

1996 process rule, when he talks about prioritizing these things according to what their energy demand or consumption was and that

was an annualized process that I would characterize by all measures as having failed in the sense that it may have been the right

idea at the time. It was certainly supported by most of the people

at this table. But in the end, the net result was we met no deadlines and we enacted almost nothing in terms of the regulations.

So now, actually what we are going to is time management and determining a schedule for when we will knock these things down

methodically on a critical path. And it may be that some of them

are out of order or out of favor with different parts of the industry

or stakeholder at given times, but we, as a nation, have an obligation to take care of all of them, because they are in law and we

are going to pursue that systematically.

Mr. WALDEN. And I appreciate that and maybe we all need to

spend more time together more often, as pleasurable as that is for

all us, I am sure, but I really think that needs to happen in this
153

country if we are going to achieve these goals, which as a consumer, I want to achieve. When we are looking at the carbon emissions and all the environmental things, we don’t need to be building more power plants if we don’t need them and the extent to

which we conserve, we won’t need as much power out there and if

we have got problems in the statute, for heaven’s sakes, work with

us and I am sure the chairman and others on this committee would

be willing to work with you all to fix the problems.

Mr. BOUCHER. Thank you very much, Mr. Walden. And Mr.

Karsner, let me underscore again our collective frustration is not

with you, it is with those at DOE who preceded you. Mr. Shimkus

from Illinois is recognized for 5 minutes.

Mr. SHIMKUS. Thank you, Mr. Chairman. I want to start with

first of all, thank you for coming. I do think this has been a good

hearing. I am sorry. I was able to fly out this morning, so I missed

some of the opening statements. But Mr. Rosenfeld, you mentioned

44 standards since 2005. When was the California energy crisis? In

what year?

Mr. ROSENFELD. Sorry. It was really bad at the end of—early

2001.

Mr. SHIMKUS. Right. So the only reason why I say that is because that probably provided the constituency of California to understand, because there was—I mean, I sat on this committee. We

had a lot of debates and hearings on that and there was movement

from the State government to say you have to get energy efficient,

folks. So I would say that there was also a crisis in California

based upon a lot of things.

I would say that that was probably an impetus to the State of

California to really move aggressively in these energy debates on

efficiency, don’t you agree?

Mr. ROSENFELD. I 50 percent agree, sir.

Mr. SHIMKUS. I would like you to get to 65, that is passing.

Mr. ROSENFELD. I 65 percent agree, sir.

Mr. SHIMKUS. OK, good.

Mr. ROSENFELD. Actually, interest in California in energy efficiency is way up and in fact, you are right. In non-standards activities, we have increased our budget for energy efficiency programs

to beat the standards from $250 million a year, which is 1 percent

of electric revenues, to $750 million a year, which is nearly 3 percent of electric revenues. With respect to the standards, however,

we adopted our first appliance standard in 1975, effective in 1977.

That was for refrigerators. We have updated appliance standards

every 3 years since 1975, so we have been pretty consistent.

Mr. SHIMKUS. Yes, I would agree, but I would say 44 standards

since 2005 DOEs show a ramp-up.

Mr. ROSENFELD. You are 65 percent right.

Mr. SHIMKUS. Thank you. I will take it. I am in the minority

now; passing is OK. The other question I wanted to ask was, in following up, and this is from the committee, the Republican prep, it

talks about these—we deal with some voluntary aspects where,

even through the committee where we do the prescription drug

user fee, industry puts more money in to try and encourage the

Federal Government to respond quicker and it has been very successful.
154

My question is, there is two-fold. One is if we formulated a process by which working across the interest groups here, where we try

to expedite that process, is that something that could translate into

this debate? Because efficiency standards will be part—I have

heard the chairman’s opening statements and I think efficiency

standards will be part of an energy security bill or whatever we are

going to call—so the question is how do we get it done right and

for the consumer folks here, it was my understanding that there

was a concern in the EPAct Bill 2005 that moving in this process

might violate the due process rights of persons who are not part

of the consensus process. So this is really a two-fold question and

I will just open it up for anyone who wants to answer.

One, is there a way that we can empower making good rulemaking on an expedited process based upon maybe a fee setup,

kind of like PDUFA? Second, is there a credible due process rights

for persons who are not part of the consensus approach? And if

those of you who understand that question, if you want to answer

it, just raise and go for it.

Mr. DELASKI. I will answer the second part of your question.

Mr. SHIMKUS. OK. Why not the first?

Mr. DELASKI. I don’t have an answer for you.

Mr. SHIMKUS. OK.

Mr. DELASKI. I will do the one that I can.

Mr. SHIMKUS. OK.

Mr. DELASKI. On the expedited process, we do think that it DOEs

make sense for DOE to have the authority for an expedited process

where a consensus exists. It is not going to catch up, with 10 years

overdue. It is not going to solve that problem, but if we can cut 3

months or 6 months off the process, so be it. That is a good thing.

It is not revolutionary, but it is a small improvement. That said,

we did see the language the Department proposed—in 2005. It did

have problems in terms of not creating an adequate opportunity for

stakeholders to raise objections, who weren’t part of the in group.

We think some alternative language could achieve the same objective without that kind of constraint.

Mr. SHIMKUS. And I would encourage you to work with the committee staff. That is probably something that we could probably

help fix in this process, I would think, Mr. Chairman. Anyone else

like to add to that? Mr. Karsner.

Mr. KARSNER. Yes, sir, Congressman. I would say that we began

meeting with—well, we always meet with stakeholders and the

folks at this table, but with regard to this specific issue, we began

a dialog on this last week. There is really two key components and

it is how you define what a consensus is, that is building a consensus on the word consensus and then having the opportunity for significant objection, whether that significance is qualified quantitatively, et cetera, and so we are working with them to try and

integrate those concerns because our goal would be to go well beyond 3 months’ savings or 6 months’ savings, but to push the envelope to compress the timetable as much as possible and go to a

final rule once a consensus is made. As the GAO report suggests,

energy savings delayed or energy savings denied and so the more

time we can make when we agree that we are in consensus, that
155

would be our objective and we hope we can work with the committee on that.

Mr. SHIMKUS. And my time has expired. I will just end with saying I hope that when we address efficiency standards that it

DOEsn’t negatively affect smart metering, smart appliances and

the like, Mr. Chairman, and that is just my little commentary.

Thank you.

Mr. BOUCHER. Thank you very much, Mr. Shimkus, and I wholeheartedly endorse your reservation with regard to that. The gentleman from Texas, Mr. Burgess, is recognized for 5 minutes.

Mr. BURGESS. Thank you, Mr. Chairman. Actually, Mr. Karsner,

let us just pick up on that last point that Mr. Shimkus just made

with the smart grid technologies. We are actually going to have a

hearing about that later this week, I believe, but those technologies

sometimes require advanced appliances that can interact and communicate with the grid. Is there a danger, as we push forward with

setting appliance standards, do we have a concern that we are

going to somehow interfere with that process, with the setting of

efficiency standard?

Mr. KARSNER. I suppose there is always a danger of unintended

consequences when you push the envelope on new technology development, but in general, it is integral to the Department’s mission that we want to proliferate those sorts of technologies and so

between voluntary standards, tax incentives and then regulatory

standards, we need to find that equilibrium, but it is a new horizon. You would almost be better off asking Mr. Gaddis, McGuire

and others.

Mr. BURGESS. Dr. Rosenfeld.

Mr. ROSENFELD. We are very much into this in California. We

are installing 12 million smart meters and with new buildings we

will require that thermostats have the capability of communicating,

being communicated with directly from the utility source to know

when there is a high price or a congestion of power. We haven’t

seen any conflicts with energy efficiency problems that we are

aware of.

Mr. BURGESS. Keep the microphone there. In my house I am not

allowed to touch the thermostat and I doubt very seriously that my

wife will let the power company touch it either, but I wasn’t here

when you did your testimony. I wonder if we could go to the slide

that you showed on the annual peak in California in 2003, the annual peak savings from efficiency programs and standards, the

graph that you showed. Just so I am clear on this, can you explain

to me what the utility efficiency programs, the yellow block in that

graph, what is represented there?

Mr. ROSENFELD. With great pleasure. We have a pretty wellrounded system in California with what are called public goods

charges, during these 30 years of which, on the average, 1 percent

of your utility bill has been directed back to be spent by the utilities to do anything they can do to beat standards. That includes rebates for white goods. Almost any time the Energy Star logo appears on any appliance, your local utility will give you a rebate to

buy the payback time down to a couple of years. This money goes

to design assistance for new homes or retrofits. One of the most
156

dramatic things it DOEs, now that we are getting a lot of interest

in compact fluorescent lamps.

I will give you an example. I got a compact fluorescent lamp from

a store this weekend for 25 cents. Now, how did that happen? Well,

your electricity bill goes into what is called an upstream buy down

whereby the California utilities have told manufacturers anywhere

in the world—most of these compact fluorescents are made in Taiwan or in China and they cost about $3 wholesale. The manufacturer gets two bucks off of that and reduces the wholesale price to

$1 and then by the time it works its way back to the retailers, to

the retail chain in California, it is like $2 or $3. So a retail compact

fluorescent in California is cheaper than a wholesale compact fluorescent in Taiwan. That is sort of the way we use our ingenuity to

get efficient products into the market.

Mr. BURGESS. And would this apply to things like skylights? I

noticed Wal-Mart, in Texas, when they build new stores now they

are making much greater use of skylights in their buildings that

they are putting up.

Mr. ROSENFELD. That is right. The California utilities offer rebates on more efficient windows than necessary on skylights, on

what is called daylight harvesting, which is controls turning the

lights out near the outside of the buildings. They help us with our

standards. They have a program called CASE, Codes and Standards Enhancement, in which they do the analysis of the standards.

They do anything they can to reduce electric use.

Mr. BURGESS. I don’t want to interrupt, but just, from your graph

here, that sort of looks like you got the most bang for the buck or

more bang for the buck out of that than appliance standards. Do

you expect that by pushing the appliance standards envelope a little bit that you are going to make the purple part of that graph

jump up in the years to come?

Mr. ROSENFELD. What happens is that the yellow part of the

graph, which is expensive, but still costs us only 21⁄2 cents to avoid

a kilowatt hour with that. It is a very good deal. But it is expensive. What it DOEs is to increase the commercialization of better

products and then once they are robust, I will give you one more

example in a second. Once they are robust, then we can put them

into standards. But remember, we can’t put something into new

building standards, for example, unless it is trusted enough in the

marketplace and unless there are 200,000 units a year available.

Let me give you a tiny example.

Mr. BURGESS. Well, let me just ask you a question. What about

tankless hot water heaters? They are gas, they are not electricity,

they are gas fired, but having recently built a house, I have been

impressed that that has delivered a lot of bang for the buck as far

as energy savings.

Mr. ROSENFELD. I believe, but I am not sure that there are rebates for them in California, but I am not positive.

Mr. BURGESS. Would you give me a rebate in Texas for the one

I bought if I send it?

Mr. ROSENFELD. That might be a problem.

Mr. BURGESS. Let me just ask you one last question and it

DOEsn’t have to do with appliances so much, but we were in Denmark this summer with the chairman on a trip and the district
157

heating that they have developed there, and I don’t know whether

that is applicable to any area of the United States, but I guess they

take industrial and primarily from electrical generation, the heat

thrown off from that process. They have these elaborate colored

vents or tubes or water conduits that go all over the city and an

article in the Washington Post a few weeks ago suggested that that

has resulted in a big savings for them; a lot of headache when it

was first being developed and I think their political leaders took a

lot of grief for that, but ultimately, it has delivered a low-cost heating alternative and of course, for those who are concerned about

greenhouse gases, it is another way of reducing those emissions. Is

that the type of strategy that you might employ with the yellow

part of the graph?

Mr. ROSENFELD. No, sir. This is entirely consumer oriented programs. District heating, as you mentioned, it is a great idea for

dense cities and every major European city from Berlin through

Copenhagen through Paris through London has district heating.

But that is a planning issue which could be handled on public

goods money, but it is not part of this consumer oriented yellow

band.

Mr. BURGESS. Thank you, Mr. Chairman.

Mr. BOUCHER. Thank you very much, Mr. Burgess. Mr. Matheson, do you have additional questions you would like to—I think we

probably have exhausted our range of questions for what is now

the afternoon. And I want to say thank you very much to our panel

of witnesses for joining us here today. Mr. Inslee, you have just

barely made it under the wire here and Mr. Inslee, we will recognize you for a period of 5 minutes to ask your questions.

Mr. INSLEE. I appreciate it, Mr. Chairman, but I am going to

break my rule and since I have nothing intelligent to add, I will

just be quiet here. I will waive, thank you.

Mr. BOUCHER. All right, Mr. Inslee waives his questions. Well,

let me say thank you very much to our panel of witnesses for joining us today. You have been very informative on what is a truly

timely topic for us. We will be considering your recommendations

in the near term and producing legislation for consideration on the

House floor in July, which will contain a number of statutory

changes, many of which will be in conformance with what you have

discussed with us here today. So again, with thanks to our witnesses, this hearing stands adjourned.

[Whereupon, at 12:18 p.m., the subcommittee was adjourned.]

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ARTHUR H. ROSENFELD

RESPONSES TO QUESTIONS FROM THE HONORABLE JOHN D. DINGELL

1. You generally favor allowing more flexibility to States to set their own

standards. The industry witnesses uniformly favor tight preemption of the

States for all covered appliances and equipment in the law, even where the

Department of Energy (DOE) determines not to set a standard. Both groups

seem to acknowledge that the threat of State Standards is a major reason

that industry is willing to negotiate consensus standards.

a. Is the potential for establishment of separate State standards primarily a means of leverage to bring industry to the table, or would you actually prefer that States be free to act, even if many do not act at all?

Response: The opportunity for State standards is not primarily to leverage industry, although that is a useful by-product. The National Appliance Energy Conservation Act (NAECA) as originally passed by Congress included criteria for States to

receive waivers from Federal preemption because it was expected there would be situations in which States had compelling reasons to have standards different than

Federal standards due to local State conditions, such as high energy prices, energy

shortages or environmental concerns. As it has played out, inaction by DOE, and

DOE standards that are based on ‘‘consensus’’ rather than efficiency levels that are

justified by engineering and economic analyses, have created additional opportunities for States to be motivated to set their own standards. If State actions motivate

DOE and industry to more closely follow the original intent of NAECA, then that

is a desirable outcome.

b. Do you believe that reaching a national consensus standard is preferable to having a situation where a few States have their own standards

and many have none at all?

Response: A national standard is preferable only if it has a sound analytic basis

and achieves the maximum improvement in energy efficiency that is technologically

feasible and economically justified. Anything less shackles the States to a lowestcommon-denominator standard that DOEs little to promote true energy efficiency.

See section I.A.4., pages 8 through 9, of my May 1, 2007, written testimony (my

written testimony).

c. Do you think the manufacturing groups are being disingenuous or exaggerating when they claim that individual State standards would be wholly unworkable for them?

Response: Individual State standards have been, and will continue to be, feasible

and workable. California and other States have been setting efficiency standards for

a variety of appliances for decades, and manufacturers have been able to conduct

business in these States with little or no disruption. In numerous appliance standard rulemakings in California, the California Energy Commission (CEC) has asked

manufacturers for data that would support their claim that a State standard is unworkable, and they have failed to do so. You should ask manufacturers for the same

data.

d. Have you performed or seen any credible analysis of the incremental

cost to manufacturers of meeting separate State standards and managing

their deliveries and sales in accordance with them?

Response: The CEC has consistently requested that manufacturers submit data

regarding the cost of complying with California efficiency standards, but such data

has not been submitted. Without manufacturer cooperation and the submission of

requested data, a detailed analysis of such costs is not possible.

2. Is it realistic to allow State standards to suddenly become effective for

any appliance where DOE has missed any deadline in its process of adopting Federal standards?

Response: This question incorrectly assumes that State standards will ‘‘suddenly

become effective.’’ In reality, DOE, the States and manufacturers will know well in

advance when DOE must meet a deadline and whether DOE will be able to do so.

Also, all parties will know well in advance what a State standard is and when it

will become effective. Thus all parties will be afforded ample time to prepare for

compliance with a State standard should DOE fail to comply with a deadline. See

section I.A.2., page 6, of my written testimony.

3. Would this not potentially result not only in a large number of standards for a given appliance, but also standards coming and going in-and-out
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of effect over short periods of time as a function of whether State standards had been adopted and Federal standard setting was meeting all deadlines?

Response: In practice, a small number of States would set generally consistent

standards for a given product. Again, as stated in the answer to question 2, there

is a lag-time between the adoption and the effective date of a product standard.

Thus if DOE did miss a deadline for a product, and then subsequently did adopt

a standard for that product, that standard would not be effective, and thus would

not preempt the existing State standard, for several years.

You also seek to have the DOE program improved in speed and rigor so

that it can set standards that may be better than those that emerge from

the consensus process. Would such effective DOE standards also be preferable to you than allowing the States freedom to set separate standards?

Response: If DOE improves its rulemaking in the ways I suggest, see section I.A.,

pages 5 through 9, of my written testimony, with the preeminent goal of achieving

the maximum improvement in energy efficiency that is technologically feasible and

economically justified, then a Federal standard is preferred over individual State

standards.

5. You were a key advisor on appliance efficiency standard setting during the Clinton administration. Did you make the same recommendations

for expediting approval processes at that time?

Response: See response to 5.b.

a. If you did so, what reasons were you given that they were not adopted

then?

Response: See response to 5.b.

b. If not, why not?

Response: When I was at DOE I worked mainly on updating air conditioning

standards, which were initiated by California in 1977 and taken over by DOE

through NAECA, so I considered them Federal problems. Unfortunately I was unaware that other States were impatient. I just tried to hurry them along.

Are these delaying factors recent?

Response: They have been slow since the passage of NAECA, but have grown

worse recently. See section I.A.1., pages 5 through 6, of my written testimony.

d. Has this administration added any steps to the rulemaking process,

such as the Advanced Notice of Proposed Rulemaking step or Office of

Management and Budget review, that have made it slower?

Response: I am unaware of new steps, but repeat that DOE has recently interpreted the waiver rules in an unacceptably strict manner.

6. Manufacturers have what appear to me to be sound reasons why numerous individual State standards for the same appliance would raise their

costs and complicate their product distribution and maintenance practices.

Producing and appliance to a single national efficiency standard market is

obviously easier and cheaper than doing so to multiple State standards. Yet

your testimony suggests we should allow individual States to set standards

whenever and for whatever product that DOE has failed to do so, had declined to do so, or has been late in doing so. Do you believe it is a valid

concern by manufactures that they might face a proliferation of State

standards covering a single appliance?

Response: As stated in the response to question 3, it would be a mistake to assume that States will adopt standards for any given product that differ significantly

from other States in their respective climate region. This is the only logical conclusion, as there is no reason for a State to adopt efficiency standards that do not correspond with the regional climate of that State. For example, the standard for air

conditioners would be generally consistent in California, Arizona, New Mexico, Nevada, Utah and most of Texas, as the climate is hot and dry. Similarly, the standard

for air conditioners would be consistent in hot and wet/moist/soggy States such as

Florida, Georgia, North and South Carolina, Alabama, Mississippi, Louisiana, Arkansas and Tennessee. What would most likely emerge are de facto regional standards similar to the federally-articulated regional standards that I endorse in my testimony. See section I.A.3.a., page 7, and appendix C of my written testimony. Thus

it is unreasonable to assume that manufacturers will be faced with standards that
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vary from State to State to State, but rather we will, and should, see standards that

vary from one climate region to another.

a. If so, how can California then set its own standards without raising

this concern?

Response: A State standard that is based on achieving the maximum improvement of energy efficiency that is technologically feasible and economically justified

will be consistent with other States in that region, for the reasons discussed above.

The appliance rule-making process in California allows for significant input from

manufacturers. It is in this forum that they may present their facts and arguments

that a certain State standard is not economically justified.

b. If not, have you analyzed the energy-savings benefits against the potential costs of requiring manufacturers to meet such standards, passed

through in higher appliance costs?

Response: As stated in the response to question 1d., the CEC has consistently requested, but has not received, data from manufacturers that would enable the CEC

to conduct a comprehensive analysis that would take into account the potential costs

to manufacturers of meeting certain California standards.

7. At page 8 of your written testimony, you suggest that DOE can adopt

more effective standards than would result from successful negotiations

with between manufacturers and efficiency advocates. Are there currently

effective standards that have resulted from a consensus process that you

believe are significantly weaker than they should be and would have been

using an appropriate and effective rulemaking process?

Response: It is difficult to know what DOE should or would have done absent a

consensus recommendation. At best, we can only make educated guesses.— The results will be highly subjective since DOE’s criteria, in the final analysis, require it

to apply judgment. Without doing a complete review of the record of DOE’s past decisions, it is safe to say that many of the consensus proposals that were adopted

by DOE were at efficiency levels less than what DOE’s technical analysis showed

was justified. The reason for this is DOE’s lack of willingness to follow the direction

of NAECA to set standards at levels justified by technical analysis, and the resulting ability of industry to leverage efficiency advocates to accept lower levels of efficiency in order to get any national standard.

8. Referring to page 10 of your testimony, is it your view that allowing

a State to set a performance-based standard for a whole building that could

most realistically be met by including appliances with higher efficiency

standards than required by DOE, but that standard could also be met in

other ways such as insulation, would that preclude that State from establishing such a building standard without a DOE waiver under the appliance efficiency law?

Response: It is my view that California is precluded from such a building standard unless a waiver from DOE is obtained. This is why I recommend a change in

Federal law that authorizes a State to base the energy budgets in a performancebased building code on appliances with more than the Federal minimum efficiencies

if the resulting budget is technically feasible, cost effective and would not unduly

burden interstate commerce.

9. In your view, how should the appliance efficiency standards process be

applied for electric lighting, given three technologies—the classic incandescent bulb, available compact fluorescent bulbs, and emerging solid-state

lighting—have very different first costs, energy consumption, life cycles,

and availability in the market?

Response: Representative Jane Harman has introduced an amendment which

phases out lowest cost general service incandescents, but permits infrared reflecting

technology (or other strategies) which increase lumens per watt by about 50 percent.

This is a good first step. We should start phasing out today’s inefficient incandescent bulbs, keeping in mind there are efficient halogen incandescent bulbs that are

coming into the market, and move toward requiring levels that can be achieved

today by compact fluorescents (CFLs) and will be achieved soon by solid-state light

sources. This can be done by setting a two-step standard that bans the inefficient

bulbs effective in five years, and requires CFL-level efficiency in ten years. These

new bulbs will be extremely cost-effective to consumers, save energy, reduce greenhouse gas, and will be profitable to industry.
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RESPONSES TO THE QUESTIONS OF THE HONORABLE EDWARD J. MARKEY

1. Two years ago, this committee approved my amendment to sunset the

Federal preemption of State energy efficiency standard whenever DOE was

more than 3 years late in issuing a new or revised efficiency standard. My

amendment was later dropped from the final version of the bill due to opposition from the industry and the Administration. In light of the problems

the GAO and other have identified with DOE’s persistent failures to issue

appliance standards in a timely manner, should Congress now enact such

an amendment so that the States aren’t preempted from adopting efficiency standards when DOE fails to act in a timely fashion?

Response: Yes. There must be a mechanism in place that helps staunch the loss

of energy savings that results when DOE fails to meet an efficiency standard deadline. The best way to accomplish this is to halt Federal preemption of a State standard if DOE misses the deadline for a new or revised standard. See section I.A.2.,

page 6, of my written testimony.

2. Should DOE be required to regularly review all existing appliance

standards to determine whether technology improvements warrant adoption of stronger efficiency standards, and if so, to adopt rules mandating

stronger standards?

Response: Yes. DOE should always be vigilant when it comes to efficiency standards, including keeping abreast of new technologies and ensuring that appliances

standards reflect the maximum improvement in energy efficiency that is technologically feasible and economically justified.

3. Should this subcommittee approve legislation providing DOE with

clear authority, or even a mandate, to adopt standards for appliances that

vary by region or zone when the cost-effectiveness of a higher standard

also varies by region—so that DOE could adjust standards for central air

conditioners, boilers, or furnaces to take into account regional climates?

Response: Yes. I believe that DOE already has the authority to adopt regional

standards for heating and cooling appliances, but has simply failed to do so. As

such, it is necessary for Congress to make clear to DOE that it DOEs have this authority, and that it should adopt such regional standards where appropriate. See

section I.A.3.a., page 7, of my written testimony.

4. Should Congress eliminate the current requirement for an Advanced

Notice of Proposed Rulemaking, which lengthens the rulemaking process,

and instead allow DOE to go directly into a Notice of Proposed Rulemaking

and solicit public comment whenever it wants to consider a new appliance

standard?

Response: Yes. The Advanced Notice of Proposed Rulemaking (ANOPR) is an unnecessary, inefficient and time-consuming process. DOE should eliminate the

ANOPR and proceed directly to the Notice of Proposed Rulemaking. See section

I.A.1., page 5, of my written testimony.

5. Should DOE be directed to repeal its so-called ‘‘Process Rule’’—which

caused so much of the ‘‘paralysis by analysis’’ that has led DOE to be unable to meet its statutory deadlines for issuing rules on appliance efficiency?

Response: Yes, the ‘‘Process Rule’’ should be eliminated or substantially changed.

At present, the Process Rule is needlessly complex and hinders effective and efficient analysis. See section I.A.1., pages 5 through 6, of my written testimony.

6. Should Congress make it crystal clear in the statute that DOE has the

authority to adopt more than one appliance efficiency standard for an appliance?

Response: Yes. As many appliances have more than one efficiency attribute, Congress should make it clear to DOE that it has the authority to:

• Establish both water and energy efficiency standards for the same appliance;

• Adopt different energy (or water) metrics for the same appliance (e.g., SEER and

EER for air conditioners);

• Regulate all energy-or water-using components within a regulated appliance;

and

• Require prescriptive components in any appliance. See section I.A.3.b., pages 7

through 8, of my written testimony.
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7. Should the legal standard for approval of State requests for a waiver

of Federal preemption be changed to allow DOE to approve such waivers

unless the burden on interstate commerce clearly exceeds the local benefits?

Response: In considering preemption waivers, DOE should weigh the three criteria for preemption contained in Energy Policy and Conservation Act (EPCA)—the

State’s interests in the standard, the potential burden on the national appliance industry, and the potential for consumer utility—and grant a waiver if the State’s interests predominate. See section I.B.1, page 9, of my written testimony.

8. Should a State be permitted to adopt performance-based building

codes on heating, cooling, and water heating appliances that exceed the

Federal minimum standards, if the State found that the resulting energy

saving were technologically feasible, cost-effective, and would not unduly

burden interstate commerce?

Response: Yes. By doing so, the maximum feasible amount of energy and water

efficiency can be achieved while providing the builder with the greatest degree of

choice and the best deal for the buyer. See section I.B.2., pages 9 through 11 of my

written testimony.

9. If DOE chooses to regulate only one aspect of an appliance’s energy or

water usage and fails to others, should the States be clearly permitted to

regulate these other aspects of energy or water usage that are not covered

by DOE’s rules so that we don’t fall into a regulatory black hole of having

no Federal standard and no State standard?

Response: Yes. For example, the statute should clarify that if DOE has established an SEER standard for air conditioners, but not an EER standard, then the

States are not preempted from setting an EER standard. See section I.B.3., page

11, of my written testimony.

10. Should Congress direct DOE to step up enforcement of the appliances

standards law by requiring periodic independent testing to verify manufacturer’s performance claims?

Response: Yes. Congress should provide DOE with the funding to verify manufacturers’ performance claims via independent testing, and conducting surveys for noncompliant appliances offered at retail outlets. DOE should also be required to regularly report the data and findings derived from these and other enforcement efforts

to the appropriate congressional committees. See section I.C.1., page 11, of my written testimony.

11. Should Congress adopt expedited procedures for consideration of

rules that grow out of a stakeholder consensus process involving manufacturers, the States, and energy efficiency advocates?

Response: Yes, as long as the consensus achieves the maximum improvement in

energy efficiency that is technologically feasible and economically justified.

12. In Dr. Rosenfeld’s written testimony; he notes that central air conditioners can be rated in terms of both and energy efficiency ratio (or EER)

that depends on the actual outdoor temperature, and a season energy efficiency ratio (or SEER) that is measures at a single season average temperature. I have been told that there are some central air conditioning units

that have a very high SEER rating, but also a low EER ratio during particularly hot days. One such unit has a SEER 19 rating, and has an EER

of 17 at moderate temperature conditions, but then falls to an EER on hot

days when a second stage engages. This would appear to actually increase

power consumption by a substantial amount at times when the power grid

may be most stressed and expensive (and often polluting) peaking units

may have to be turned on to meet demand. In light of this, DOEs DOE need

to be able to set appliance standards that prevent such a situation?

Response: There are two different issues here. First, the laws of physics (Carnot

efficiency) reduce the efficiency of an air conditioning unit as the outside air temperature rises. But, second, air conditioners should be designed to be most efficient

under conditions which are most important; e.g. 95 degrees Fahrenheit and soggy

in Atlanta, and 110 degrees Fahrenheit and dry in Phoenix. That is why we must

break the United States up into three climate zones for air conditioning, optimized

for Atlanta, Phoenix, and Chicago climates. See section I.A.3.a., page 7, of my written testimony.
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13. Do you think DOE should be directed to issue efficiency standards for

digital TV sets?

Response: Yes.

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