1

- i CHAPTER 1. INTRODUCTION

TABLE OF CONTENTS

1.1 PURPOSE OF THE DOCUM ENT

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- 1

1.2 OVERVIEW OF STANDARD S FOR RESIDENTIAL DI SHWASHERS

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- 1

1.3 PROCESS FOR SETTING ENERGY CONSERVATION STANDARDS

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1.4 STRUCTURE OF THE DOC UMENT

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LIST OF TABLES

Table 1.3.1 Analyses Under the Process Rule

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- 31-1 CHAPTER 1. INTRODUCTION

1.1 PURPOSE OF THE DOCUM ENT

This techni cal support document (TSD) is a stand

- alone report that provides the technical analyses and results supporting the information presented in the direct final rule and executive

summary for residential dish washers

.

1.2 OVERVIEW OF STANDARD S FOR RESIDENTIAL DISH W ASHERS

The Energy Policy and Conservation Act (EPCA) of 1975, Pub. L. 94

- 163 (42 United States Code (U.S.C.) 6291

– 6309)

, established an energy conservation program for major household appliances. The National Energy Conservation Policy Act of 1978 (NECPA) , Pub. L.

95

- 619, amended EPCA to add Part C a of Title III (42 U.S.C. 6311

– 6317), which established an energy conservation program for certain industrial equipment. Additional amendments to EPCA give DOE the authority to regulate the energy efficiency of s everal products, including

residential dish washers

— the products that are the focus of this document. The amendments to EPCA in the National Appliance Energy Conservation Act of 1987 (NAECA), Pub. L. 100

- 12,

established standards for residential dish washers , as well as requirements for determining

whether these standards should be amended. (42 U.S.C. 6295 (g) )

NAECA established the first prescriptive standards for residential dish washers

, requiring

that dish washers be equipped with an option to dry without heat , and further required that DOE conduct two cycles of rulemakings to determine if more stringent standards are justified. b (42 U.S.C. 6295 (g)( 1 ) and (4)) On May 14, 1991, DOE published a final rule in the Federal Register (FR) establishing the first s et of performance standards for residential dish washers; the compliance date of the new standards was May 14, 1994

. 56 FR 22250 . DOE initiated a second standards rulemaking for residential dish washers, publishing a n advance notice of proposed rulemaking (A NOPR) on November 14, 1994, to consider amending the energy conservation standards for clothes washers, dishwashers, and clothes dryers. 59 FR 56423

. However, as a result of the priority

- setting process outlined in its Procedures for Consideration of New o r Revised Energy Conservation Standards for Consumer Products (the “Process Rule”) (61 FR 36974 (July 15, 1996); 10 CFR part 430, subpart C, appendix A), DOE suspended the standards rulemaking for dishwashers.

a Part C has been redesignated Part A

- 1 in the United States Code for editorial reasons.

b DOE defines “ dish washer” under EPCA as “a cabinet

- like appliance which w ith the aid of water and detergent, washes, rinses, and dries (when a drying process is included) dishware, glassware, eating utensils, and most cooking utensils by chemical, mechanical and/or electrical means and discharges to the plumbing drainage system .” 10 CFR

430.2.1-2 To complete the second rulemaking cycle requ ired by NAECA, on March 15, 2006, DOE published on its website the Rulemaking Framework for Commercial Clothes Washers and Residential Dishwashers, Dehumidifiers, and Cooking Products , and a notice announcing the availability of this framework document. On November 15, 2007, DOE published an ANOPR addressing energy conservation standards for these products. 72 FR 64432. On December 19, 2007, however, Congress enacted the Energy Independence and Security Act of 2007 ( EISA

2007 ), Pub. L. 110

- 140 , which, among other things, established maximum energy and water use levels for residential dishwashers manufactured on or after January 1, 2010. (42 U.S.C. 6295(g)(10)) Because EISA 2007 established standards for residential dishwashers, DOE codified the statutory sta ndards for these products in a final rule published March 23, 2009. 74

FR 12058.

1.3 PROCESS FOR SETTING ENERGY CON S ERVATION STANDARDS

Under EPCA, when DOE is studying new or amended standards, it must consider, to the greatest extent practicable, the followi ng seven factors (42 U.S.C. 6295 (o)(2)(B)(i)):

1) the economic impact of the standard on the manufacturers and consumers of the affected products;

2) the savings in operating costs throughout the estimated average life of the product compared to any increase s in the initial cost or maintenance expense;

3) the total projected amount of energy savings likely to result directly from the imposition of the standard;

4) any lessening of the utility or the performance of the products likely to result from the impositi on of the standard;

5) the impact of any lessening of competition, as determined in writing by the Attorney General, that is likely to result from the imposition of the standard;

6) the need for national energy conservation; and

7) other factors the Secretary considers relevant.

Other statutory requirements are set forth in 42 U.S.C. 6295 (o)(1)

– (2)(A), (2)(B)(ii)

– (iii), and (3)

– (4) and 42 U.S.C. 6316(e).

DOE initiated the current rulemaking in response to the “Agreement on Minimum Federal Efficiency Standa rds, Smart Appliances, Federal Incentives and Related Matters for Specified Appliances” (the “Joint Petition”), a comment submitted on July 30, 2010, by groups1-3 representing manufacturers

, energy and environmental advocates

, and consumer groups (collectivel y, the “Joint Petitioners”). This collective set of comments, which DOE refers to in

this notice as the “Joint Petition” c recommends specific energy conservation standards for

residential dish washers that, in the commenters’ view, would satisfy the EPCA re quirements in 42 U.S.C. 6295(o).

EPCA allows DOE to issue a direct final rule establishing an energy conservation standard on receipt of a statement submitted jointly by interested persons that are fairly representative of relevant points of view (inclu ding representatives of manufacturers of covered products, States, and efficiency advocates) that contains recommendations with respect to an energy conservation standard that are in accordance with the provisions of 42 U.S.C. 6295(o).

DOE has concluded th at the recommendations of the Joint Petition satisfy the requirements of 42 U.S.C. 6295(o). Therefore, DOE is publishing this direct final rule concurrently with a notice of proposed rulemaking that proposes identical energy conservation standards. If DOE receives adverse comment and determines that such comment may provide a reasonable basis for withdrawing the direct final rule, this final rule will be withdrawn and DOE will proceed with the proposed rule.

For the direct final rule, DOE conducted each o f the analyses typically performed at the Preliminary Analysis and NOPR rulemaking stages , as shown in Table 1.3.1.

Table 1.3.1 Analyses Under the Process Rule

Preliminary Analyses NOPR Final Rule

Market and technology assessment Revised preliminary analyses Revised NOPR analyses

Screening analysis Life

- cycle cost sub

- group analysis

Engineering analysis Manufacturer impact analysis

Energy use determination Utility impact analysis

Markups for equipment price

determination Environmental assessment

Life

- cycle c ost and payback period analysis Employment impact analysis

Shipments analysis Regulatory impact analysis

National impact analysis

Preliminary manufacturer impact analysis

As part of the information gathering and sharing process, DOE organized a nd held

interviews with manufacturers of the residential dish washers considered in this rulemaking. DOE selected companies that represented production of all types of products, ranging from small to

c DOE Docket No. EERE

– 2011

– BT

– STD

–0060 , Comment 1

.1-4 large manufacturers, and included the Association of Home Appliance Manufacturers (AHAM) member companies. DOE had four objectives for these interviews: (1) solicit manufacturer

feedback on the draft inputs to the engineering analysis; (2) solicit feedback on topics related to the manufacturer impact analysis; ( 3) provide an opportunity to express manufacturers’ concerns to DOE; and (4) foster cooperation between manufacturers and DOE. DOE incorporated the information gathered during the engineering interviews with manufacturers into its engineering analysis ( cha pter 5) and the manufacturer impact analysis ( chapter 12).

DOE developed spre adsheets for the engineering, Life

- Cycle Cost (LCC) Payback Period (PBP)

, and national impact analyses for each product. The LCC spreadsheet calculates the LCC

and PBP at variou s energy efficiency levels. The national impact analysis spreadsheet calculates

th e national energy savings and national ne t present values at various energy efficiency levels. This spreadsheet includes a model that forecasts the impacts of amended energy conservation standards at various levels on product shipments. All of these spreadsheets are available on the

DOE website for residential dish washers at :

ww w1.eere.energy.gov/buildings/appliance_standards/residential/dishwashers.html

.

DOE can also provide quantitative outputs from its analyses in machine

- readable format
upon request. For example, outputs from trial runs of the LCC Monte Carlo simulations c a n be provided in such a format.

1.4 STRUCTURE OF THE DOCUMENT

This TSD outlines the analytical approaches used in this rulemaking. The TSD consists of the following chapters and appendices.

Chapter 1 Introduction: provides an overview of the appliance stan dards pr ogram and how it applies to this rulemaking, and outlines the structure of the

document.

Chapter 2 Analytical Framework: describes the analytical process and methods

.

Chapter 3 Market and Technology Assessment: characterizes the market for the considered products and the technologies available for increasing product efficiency.

Chapter 4 Screening Analysis: identifies all the design options that improve efficiency of the considered products, and determines which technology options are viable f or consideration in the engineering analysis.1-5 Chapter 5 Engineering Analysis: discusses the methods used for developing the relationship between increased manufacturer price and increased efficiency.

Chapter 6 Markups Analysis : discusses the methods us ed for establishing markups for converting manufacturer prices to customer product cost s

.

Chapter 7 Energy Use Analysis : discusses the pro cess used for generating energy

use estimates for the considered products as a function of standard

levels.

Chapter 8 Life

- Cycle Cost and Payback Period Analysis: discusses the effects of

standards on individual customers and users of the products and compares the LCC and PBP of products with and without higher efficiency standards.

Chapter 9 Shipments Analysis: est imate s shipments of the products over the 30

- year analysis period that i s used in performing the national impact analysis (NIA)

.

Chapter 10 National Impact Analysis: assesse s the national energy savings, and the national net present value of total consum er costs and savings, expected to result from specific, potential energy conservation standards

.

Chapter 11 Consumer Subgroup Analysis: discusses the effects of standards on

different subgroups of consumers.

Chapter 12 Manufacturer Impact Analysis: dis cusses the effects of standards on the finances and profitability of product manufacturers.

Chapter 1 3 Employment Impact Analysis: discusses the effects of standards on national employment.

Chapter 1 4 Utility Impact Analysis: discusses certain effects of the considered on electric and gas utilities.

Chapter 1 5 Environmental Assessment : discusses the effects of standards on three pollutants

— sulfur dioxide (SO 2 ), nitrogen oxides (NO

x ), and mercury

— as well as carbon dioxide emissions.

Chapter 1 6 Mon eti zation o f Emission Reductions Benefits

Chapter 17 Regulatory Impact Analysis: discusses the impact of non

- regulatory alternatives to efficiency standards.1-6 Appendix 8

- A User Instructions for Life

- Cycle Cost and Payback Period Spreadsheets

Appendix 8

- B Uncertainty and Variability

Appendix 8

- C Estimation of Equipment Price Trends for Residential Dishwashers

Appendix 8

- D Lifetime Distributions

Appendix 8

- E Distribution Used for Discount Rates

Appendix 8

- F LCC and PBP Results Using Alternative Base Case Efficiency

Distribution

Appendix 9

- A Relative Price Elasticity of Demand for Appliances

Appendix 10

- A User Instructions for Shipments and National Impact Analysis Spreadsheet s

Appendix 10

- B National Net Present Value of Consumer Benefits Using Alt ernative

Product Price Forecasts

Appendix 10

- C National Energy Savings and Net Present Value Using Alternative

Economic Growth Scenarios

Appendix 10

- D . National Energy Savings And Net Present Value Using Alternative Analysis Period

Appendix 10

- E

. National Ene rgy Savings a nd Net Present Value Using Alternative Base Case Efficiency Trend

Appendix 12

- A M anufacturer Impact Analysis Interview Guide

Appendix 12

- B Government Regulatory Impact Model

Appendix 16

- A Social Cost of Carbon for Regulatory Impact Analysis und er Executive

Order 12866

Appendix 17

- A Regulatory Impact Analyisis: Supporting Material