Plans for Developing Energy Conservation Standards for

Battery Chargers and External Power Supplies

U.S. Department of Energy

Office of Energy Efficiency and Renewable Energy

Building Technologies Program

December 2006

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EERE-2006-DET-0136 COMMENT 04.3
TABLE OF CONTENTS

1. INTRODUCTION ............................................................................................................................................... 1-1

1.1 THE ENERGY POLICY ACT OF 2005 AND DOE 's REPORT TO CONGRESS ................................................. 1-2

1.1.1 Development of a Test Procedure for Battery Chargers and External Power Supplies .................... 1-8

1.1.2 Scophrg Workshop and Plans for Developing Energy Conservation Standards ............................. 1-10

1.1.3 Determination Analysis for Battery Chargers and External Power Supp lies .................................. 1-12

1.2 DEFINITIONS OF BATTERY CHARGER AND EXTERNAL POWER SUPPLY ................................................. 1-13

1.3 SUMMARY OF DOE 's PROPOSED TEST PROCEDURES ............................................................................ 1-14

2. RULEMAKING ANALYSES ............................................................................................................................. 2-1

2. 1 COMPONENTS OF A DETERMINATION ANALYSIS RULEMAKING............................................................... 2-2

2.2 ANALYSES FOR AN ENERGY CONSERVATION STANDARDS RULEMAKING ............................................... 2-3

2.2.1 Energy Conservation Standards Rulemaking Steps and Stakeholder Participation .......................... 2-6

2.2.2 Advance Notice ofProposed Rulemaking .......................................................................................... 2-8

2.2.3 Notice of Proposed Rulemaking ....................................................................................................... 2-10

2.2.4 Final Rule ........................................................................................................................................ 2-11

3. MARKET AND TECHNOLOGY ASSESSMENT .......................................................................................... 3-1

3.1 MARKET ASSESSMENT ............................................................................................................................ 3-2

3.2 TECHNOLOGY ASSESSMENT .................................................................................................................... 3-3

3.3 PRODUCT CLASSES .................. ................................................................................................................ 3-4

3.4 BASELINE MODELS ................................................................................................................................. 3-5

4. SCREENING ANALYSIS .................................................................................................................................. 4-1

5. ENGINEERING ANALYSIS .............................................................................................................................5-1

5.1 ENGINEERING ANALYSIS OVERVIEW ....................................................................................................... 5-1

5.2 ENGINEERING ANALYSIS APPROACH ....................................................................................................... 5-3

MANUFACTURER PRICES ......................................................................................................................... 5-4

5.4 PROPRIETARY DESIGNS ........................................................................................................................... 5-5

S OUTSIDE REGULATORY CHANGES AFFECTING THE ENGINEERING ANALYSIS ......................................... 5-5

6. ENERGY-USE AND END-USE LOAD CHARACTERIZATION ................................................................. 6-1

7. MARKUPS FOR EQUIPMENT PRICE DETERMINATION ....................................................................... 7-1

8. LIFE-CYCLE COST AND PAYBACK PERIOD ANALY SIS ....................................................................... 8-1

F. I ENERGY PRICES ....................................................................................................................................... 8-2

8.2 LIFE-CYCLE COST DISCOUNT RATES ...................................................................................................... 8-3

F.3 PRODUCT LIFETIMES ............................................................................................................................... 8-4

9. SHIPMENTS ANALYSIS ................................................................................................................................... 9-1

9.1 BASE-CASE FORECAST ............................................................................................................................ 9-1

9.2 ACCOUNTING METHODOLOGY... .... ................. ............................................. ........................................ 9-2

9.3 STANDARDS IMPACTS ON PRODUCT SHIPMENTS ..................................................................................... 9-3

10. NATIONAL IMPACT ANALYSIS ............................................................................................................... 10-1

10.1 INPUTS TO FORECASTS .......................................................................................................................... 10-1

10.2 CALCULATION OF ENERGY SAVINGS ..................................................................................................... 10-1

10.3 NET PRESENT VALUE ............................................................................................................................ 10-2

11. LIFE-CYCLE COST SUBGROUP ANALYSIS ........................................................................................... 11-1

12. MANUFACTURER IMPACT ANALYSIS .................................................................................................. 12-1

12.1 SOURCES OF INFORMATION FOR THE MANUFACTURER IMPACT ANALYSIS ........................................... 12-1

EERE-2006-DET-0136 COMMENT 04.3
12.2 INDUSTRY CASH FLOW ANALYSIS ....................................................................................................... 12-2

12.3 MANUFACTURER SUBGROUP ANALYSIS ................................................................................................ 12-3

12.4 COMPETITIVE IMPACTS ASSESSMENT .................................................................................................... 12-4

12.5 CUMULATIVE REGULATORY BURDEN ................................................................................................... 12-4

13. UTILITY IMPACT ANALYSIS ....................................................................................................................13-1

14. EMPLOYMENT IMPACT ANALYSIS ........................................................................................................14-t

15. ENVIRONMENTAL ASSESSMENT ............................................................................................................ 15-1

16. REGULATORY IMPACT ANALYSIS ........................................................................................................16-1

Appendix A. Relevant Sections of EPCA .......................................................................... A-I

Appendix B. Definitions of Battery Chargers and External Power Supplies ................ B-I

Appendix C. Issues for Comment ......................................................................................C-I

LIST OF FIGURES

Figure l . 1 Flow diagram depicting immediate requirements of EPACT 2005 .......................... 1-6

Figure 1 . 2 Energy Transfer in a Battery Charging System ....................................................... 1-16

Figure 1.3. Energy Transfer in a Battery Charger Operating in No-load Mode ....................... 1-17

Figure 1 .4. Energy Transfer in an External Power Supply Under Test .................................... 1-18

Figure 1 .5 Power Transfer of an External Power Supply Operating in No-load Mode ............ 1-19

Figure 2 . 1. Flow Diagram of the Components of a Determination Analysis .............................. 2-3

Figure 2.2 Flow Diagram of Analyses for an Energy Conservation Standard Rulemaking....... 2-5

LIST OF TABLES

Table 1.1 Excerpt from DOE's Report to Congress on Battery Chargers and External Power

Supplies ........................................................................................................................................ 1-7

EERE-2006-DET-0136 COMMENT 04.3
LIST OF ACRONYMS

AC alternating current

AEO Annual Energy Outlook

ANOPR advance notice of proposed rulemaking

BC battery charger

BT Building Technologies Program

CEA Consumer Electronics Association

CPR Code of Federal Regulations

C02 carbon dioxide

CSL candidate standard level

DC direct current

DOE U.S. Department of Energy

DOJ U.S. Department of Justice

EERE Office of Energy Efficiency and Renewable Energy

ElA Energy Information Administration

EPA U.S. Environmental Protection Agency

EPACT 2005 Energy Policy Act of 2005

EPCA Energy Policy and Conservation Act of 1 975

EPS external power supply

GRIM Government Regulatory Impact Model

ImSET Impact of Sector Energy Technologies

LCC life-cycle cost

NEMS National Energy Modeling System

NES national energy savings

NOPR notice of proposed rulemaking

NOx nitrogen oxides

NPV net present value

OMB U.S. Office of Management and Budget

RIA regulatory impact analysis

S02 sulfur dioxide

TSD technical support document

TSL trial standard level

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EERE-2006-DET-0136 COMMENT 04.3
1. INTRODUCTION

The U.S. Department of Energy (DOE) Residential Appliances and Commercial

Equipment Standards Program of the Office of Energy Efficiency and Renewable Energy's

(EERE's) Building Technologies Program (BT) develops and promulgates test procedures and

energy conservation standards for consumer appliances and commercial equipment . On August

8, 2005, the Energy Policy Act of 2005 (Pub. L. 109-58; EPACT 2005), amended section 325 of

the Energy Policy and Conservation Act (42 U.S.C. 6291 et seq.; EPCA), in part, by adding a

new subsection 325(u) that directs DOE to establish a test procedure, hold a scoping workshop

and conduct a determination analysis of energy conservation standards for battery chargers (BCs)

and external power supplies (EPSs). (42 U.S.C. 6295(u))

This document, "Plans for Developing Energy Conservation Standards for Battery

Chargers and External Power Supplies" is associated with DOE's work preparing for the scoping

workshop and determining whether to develop energy conservation standards for BCs and EPSs.

This document is published in conjunction with DOE's "The Current and Future Market for

Battery Chargers and External Power Supplies."' Together, these two documents represent the

Framework Document for these products and present the steps the DOE will follow in

conducting the determination analysis, its plans for developing energy conservation standards

(should there be a positive determination), and DOE's initial understanding of the current and

future market for these products. DOE has embedded issues for stakeholder comment

throughout the text of both documents, and included a summary list of the issues in the

Available for download in PDF format from DOE's homepage for BCs and EPSs:

http://www.eere.energy.gov/buildings'appliance_standards/residential/battery_extemal.html

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EERE-2006-DET-0136 COMMENT 04.3
appendices to both documents. Stakeholders are encouraged to review both documents and

provide comment on these issues and any others that are of concern.

Section 325 (u)(1)(D) of EPCA directs DOE to hold a scoping workshop by February 8,

2007, to discuss and receive comments on plans for developing energy conservation standards

for battery chargers and external power supplies . (42 U.S.C. 6295(u)(1)(D)) DOE prepared this

document to facilitate discussion and comment on plans for developing energy conservation

standards.

1.1 The Energy Policy Act of 2005 and DOE 's Report to Congress

EPACT 2005 amended EPCA to add a new subsection 325(u) directing DOE to conduct

certain activities on BCs and EPSs. Subsection (u) is reproduced here for convenience, and then

is discussed in detail in the following text, indicating how DOE is addressing or handling each of

these requirements. The schedule which DOE is following pertaining to these products was

published in the Report to Congress2 on January 31. 2006. An excerpt of relevant portions of the

Report to Congress also appears in this section.

2 Energy Conservation Standards Activities - Submitted Pursuant to Section 141 of the Energy Policy Act of 2005

and to the Conference Report (109-275) to the FY 2006 Energy and Water Development Appropriations Act. U.S.

Department of Energy. January 2006.

http:/hvww.eereetnergy.gov/buildings/appliance_standards/pdfs/congressional_report013106.pdf

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EERE-2006-DET-0136 COMMENT 04.3
See. 325 ENERGY CONSERVATION STANDARDS

(u) BATTERY CHARGER AND EXTERNAL POWER SUPPLYELECTRIC ENERGY

CONSUMPTION. -

(1)(A) Not later than 18 months after the date of enactment of this subsection, the

Secretary shall, after providing notice and an opportunity fbi- conmrent, prescribe, by

rule, definitions and test procedures for the power use of battery chargers and

external power supplies.

(B) In establishing the test procedures under sub paragraph (A), the Secretary

shall-

(i) consider existing definitions and test procedures used for measuring

energy consumption in standby mode and other modes; and

(ii) assess the current and projected future market for battery chargers and

external power supplies.

(C) The assessment under subparagraph (B)(ii) shall include-

(i) estimates of the significance of potential energy savings from technical

improvements to battery chargers and external power supplies; and

(ii) suggested product classesfor energy conservation standards.

(D) Not later than 18 months after the date o f enactment o f this subsection, the

Secretary shall hold a scoping workshop to discuss and receive comments on

plans for developing energy conservation standards, for c nerg v use for battery

chargers and external power supplies.

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EERE-2006-DET-0136 COMMENT 04.3
(E)(i) Not later than 3 years after the date of enactment of this subsection, the

Secretary shall issue a final rule that determines whether energy conservation

standards shall be issued. for battery chargers and external power supplies or,

classes of battery chargers and external power supplies.

(ii) For each product class, any energy conservation standards issued under

clause (i) shall be set at the lowest level of energy use that-

(1) meets the criteria and procedures of subsections (o), (p), (q),

(r), (s), and (t); and

(11) would result in significant overall annual energy savings,

considering standby mode and other operating modes.

(2) In determining under section 323 whether test procedures and energy conservation

standards under this section should be revised with respect to covered products that

are major sources of standby mode energy consumption, the Secretary shall consider

whether to incorporate standby mode into the test procedures and energy

conservation standards, taking into account standby mode power consumption

compared to overall product energy consumption.

(3) The Secretary shall not propose on energy conservation standard under this section,

unless the Secretary has issued applicable test procedures for each product under

section 323.

(4) Any energy conservation standard issued under this subsection shall be applicable to

products manufactured or imported beginning on the date that is 3 years after the

date of issuance.

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EERE-2006-DET-0136 COMMENT 04.3
(5) The Secretary and the Administrator [qf the EPA] shall collaborate and develop

programs (including programs under section 324A and other voluntary industry

agreements or codes of conduct) that are designed to reduce standby mode energy

use.

In general terms, EPCA contains three immediate tasks for DOE - 1) develop a test

procedure and definitions for BCs and EPSs; 2) hold a scoping workshop (i.e., public meeting) to

discuss plans for developing energy conservation standards; and 3) determine whether energy

conservation standards are warranted for BCs and EPSs. If the Secretary of Energy were to

make a positive determination for one or both products, DOE would initiate an energy

conservation standards rulemaking to determine what, if any, technologically feasible and

economically justified efficiency level(s) are appropriate. If an energy conservation standards

rulemaking is conducted, provisions outlined in paragraphs (u)(l)(E)(ii) and (u)(2) through (u)(4)

would apply to the rulemaking analysis. Included in these provisions, is a requirement under

EPCA 325(u)(E)(ii)(I) that DOE "meet the criteria and procedures of [EPCA 325] subsections

(o), (p), (q), (r), (s), and (t)." (42 U.S.C. 6295(u)(E)(ii)(I)) These requirements specifically

include subsection (o), which was also amended by section 135(c)(3) of EPACT 2005 to read:

"(5) The Secretary may set more than I energy conservation standard for products that serve

more than I major function by setting I energy conservation standard for each major function."

(42 U.S.C. 6295(o)(5))

The diagram below is an illustration of the three main tasks assigned to DOE for BCs and

EPSs. Due to the fact that both the test procedure and scoping workshop requirements were

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EERE-2006-DET-0136 COMMENT 04.3
scheduled for an 18-month timeframe, DOE envisions these two tasks as parallel activities. The

determination analysis is depicted as following from the scoping workshop because DOE

anticipates receiving stakeholder comment during and following the scoping workshop which

will contribute to DOE's determination analysis. Finally, a labeled "ANOPR" was added to the

diagram with a dotted border to depict that an energy conservation standard rulemaking process

would follow the determination analysis, if there were a positive determination for one or both

products.

.!.................. i

*An energy conservation standard rulemaking would only occur ifthe Secretary makes a positive determination.

Figure 1.1 Flow diagram depicting immediate requirements of EPACT 2005

DOE provided a schedule in its Report to Congress for the test procedure, determination

analysis, and possible energy conservation standards rulemaking (contingent on a positive

determination). The table below reproduces the portion of a table from the Report that pertains

to BCs and EPSs.

EERE-2006-DET-0136 COMMENT 04.3
Table 1.1 Excerpt from DOE's Report to Congress on Battery Chargers and External

Power Stippies

Rulemaking Rule Type Product(s) EPA CT 2005, Approx . Rule Final

Team Backlog, Other Initiation Date Action Date

Battery Determination Battery Chargers and EPACT 2005 NA August 2008

Chargers and Analysis External Power

External Supplies

Power

Supplies Standards Battery Chargers and EPACT 2005 FY2008, Q4 August 2011

Team External Power

Supplies (Contingent

on Determination)

Test Procedure Battery Chargers and EPACT 2005 NA February

External Power 2007

Supplies

For the test procedure, DOE published a notice of proposed rulemaking on July 25, 2006.

71 FR 42178. DOE received comment, reviewed and responded to those comments, and

published a final rule on December 8, 2006. 71 FR 71340. For detailed information on DOE's

proposal and final rule, please see the relevant sections of those two Federal Register notices.

For the determination analysis. DOE is anticipating completing this work by August

2008. If that analysis results in a positive determination, then an energy conservation standards

rulemaking process would be initiated, and would be conducted over a three-year period, ending

in August 2011. That three-year period is not specified in section 325(u). but is the timeframe

under which DOE is now scheduling and completing its standards rulemakings.

The remainder of this introductory section discusses each of these three main tasks for

BCs and EPSs that are required by EPCA. The applicable provisions and sections of the statute

associated with each of these tasks are discussed, along with an explanation of DOE's

interpretation and actions to be taken or already taken.

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EERE-2006-DET-0136 COMMENT 04.3
1.1.1 Development of a Test Procedure for Battery Chargers and External Power

Supplies

Section 325(u)(I)(A) of EPCA reads:

Not later than 18 months after the date of enactment of this subsection, the Secretary

shall, after providing notice and an opportunity for comment, prescribe, by rule,

definitions and test procedures for the power use of battery chargers and external power

supplies.

(42 U.S.C. 6295(u)(1)(A)) In this paragraph, DOE is directed to develop, publish for public

comment, and publish a final rule on definitions and test procedures measuring the energy

consumption of BCs and EPSs. This final rule is due 18 months after enactment of EPACT 2005,

which is February 8, 2007.

DOE published definitions and test procedures for BCs and EPSs (and other products) in

a final rule published on December 8, 2006. 71 FR 71340. In the Final Rule, DOE adopts the

definitions provided in EPACT 2005 for BCs and EPSs. These definitions are discussed in detail

in section 1.2 below. DOE also incorporates by reference two ENERGY STAR test procedures,

one for BCs and one for EPSs. Incorporation of the ENERGY STAR test procedures is

consistent with sections 325(u)(1)(B)(i), which instruct that "In establishing the test procedures

under sub paragraph (A), the Secretary shall- (i) consider existing definitions and test

procedures used for measuring energy consumption in standby mode and other modes[.]". (42

U.S.C. 6295 (u)(I)(B)(I)) DOE determined that the existing ENERGY STAR test procedures

for BCs and EPSs adequately measure energy consumption in standby mode and other modes for

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EERE-2006-DET-0136 COMMENT 04.3
both products. However, the ENERGY STAR test procedure for BCs does not contain a method

by which to measure active mode, so DOE reserved a section in the CFR for active mode and

intends to revisit this issue at a later date. More detail on the test procedure can be found in

section 1.3.

When establishing test procedures, EPCA directs DOE in section 325(u)( I )(B)(ii) to

"assess the current and projected future market for battery chargers and external power supplies."

(42 U.S.C. 6295(u)(I)(B)(ii)) DOE has not traditionally conducted market analysis when

developing a test procedure for a given product. because the test procedure is designed to

measure the energy consumption or efficiency of a product, irrespective of shipments or market

trends for that product. Market trend forecasts are normally conducted as part of a determination

analysis or energy conservation standards process. For a determination or energy conservation

standard, its important to know how the market is changing over time, or what new technological

innovations are being developed which could affect energy consumption. These factors impact

the overall energy savings potential of the product, and therefore would impact a determination

or energy conservation standards rulemaking process. DOE interpreted the instruction in this

paragraph to apply to the seeping workshop, which is a precursor to the determination analysis.

As discussed in Section 3, DOE's initial assessment of the current and projected future market

can be found in the aforementioned document published concurrently with this one, "The

Current and Projected Future Market for Batten' Chargers and External Pom'e r Supplies."

EERE-2006-DET-0136 COMMENT 04.3
1.1.2 Scoping Workshop and Plans for Developing Energy Conservation

Standards

DOE will hold a scoping workshop to discuss plans for developing energy conservation

standards. This statutory requirement appears in subsection 325(u)(l)(D) of EPCA, which reads,

Not later than 18 months after the date of enactment of this subsection, the Secretary shall

hold a scoping workshop to discuss and receive comments on plans for developing

energy conservation standards for energy use for battery chargers and external power

supplies.

(42 U.S.C. 6295 (u)(1)(D)) This document, published in conjunction with a Federal Register

notice announcing the scoping workshop (i.e., public meeting). represents DOE's plans for

developing energy conservation standards for these products.

DOE is providing plans for developing energy conservation standards in two parts. In the

first part, those analyses that are common to both a determination analysis (which DOE is

conducting) and an energy conservation standard (which is contingent on a positive

determination) are identified as such, and are discussed in sections 3 through 10 of this

document. Second, those analyses that would only be conducted in developing an energy

conservation standard are discussed in sections 1 1 through 16 of this document. Because these

analyses are contingent on a positive determination, DOE will only conduct these analyses for a

product (BCs and/or EPSs), if the Secretary determines that a standards evaluation for that

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EERE-2006-DET-0136 COMMENT 04.3
product is warranted. Please see section 2 for more information on the determination and the

contingent standard.

As discussed in the previous section, DOE conducted a market assessment as part of the

scoping workshop instead. Also, as discussed above, EPCA 325(u)(1)(B)(ii) requires that DOE

"assess the current and projected future market for battery chargers and external power supplies."

(42 U.S.C. 6295(u)(1)(B)) EPCA continues in 325(u)(l)(C) requiring that:

The assessment under subparagraph (B)(ii) shall include - (i) estimates of the significance

of potential energy savings from technical improvements to battery chargers and external

power supplies; and (ii) suggested product classes for energy conservation standards.

(42 U.S.C. 6295(u)(1)(C)) To comply with this requirement DOE prepared a report entitled

"The Cu rent and Projected Future Market , for Battery Chargers and External Power Supplies."

That report contains three main parts-a market assessment, a technology assessment and

suggested product classes. It was published on DOE's website concurrently with this document

and the Federal Register notice announcing the scoping workshop. The report is available (in

PDF format) at DOE's homepage for BCs and EPSs:

littp:/,,,"www.eej'e.enei-gy.gov/builf-iiiips/aL)pliance standards/residential/batterv external htrnl

DOE encourages stakeholders to review the market analysis report, as it contains initial

findings and asks for comment on various issues and concerns. Particular issues on which DOE

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EERE-2006-DET-0136 COMMENT 04.3
seeks comment are listed both in the text of the body of the report as well as in an appendix to

that report.

1.1.3 Determination Analysis for Battery Chargers and External Power Supplies

Section 325(u)(] )(E)(i) of EPCA reads "(E)(i) Not later than 3 years after the date of

enactment of this subsection, the Secretary shall issue a final rule that determines whether energy

conservation standards shall be issued for battery chargers and external power supplies or classes

of battery chargers and external power supplies." This section of the statute gives clear guidance

to DOE to study these two products and determine whether energy conservation standards would

appear to be technologically feasible, economically justified and would result in significant

energy savings. Some of the work conducted to prepare for the scoping workshop, particularly

the market assessment and technology assessment, will contribute to DOE's determination

analysis.

Section 2 of this document discusses the analytical components of a determination

analysis and identifies which of those are common to an energy conservation standards analysis

(which would only be conducted if the determination were positive for BCs and/or EPSs). Some

specific detail on the analytical work DOE is planning to conduct as part of its evaluation of

these two products can be found in sections 3 through 10 of this report. Although this document

addresses both BCs and EPSs, DOE will conduct separate analyses for each of these products,

including an engineerinp analysis. a life-cycle cost (LCC) and payback period analysis, and a

national impact analysis to determine whether energy conservation standards are technologically

feasible, economically justified, and would result in significant energy savings. DOE recognizes

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EERE-2006-DET-0136 COMMENT 04.3
that it may be possible to have a positive determination on one product and a negative

determination on the other. If this is the case, DOE would conduct an energy conservation

standards rulemaking for the product that had a positive determination, but not the other. DOE

reserves the right to revisit its determination at:any time in the future, should market conditions

change, and energy conservation standards appear to be technologically feasible, economically

justified and would result in significant energy savings.

1.2 Definitions of Battery Charger and External Power Supply

Section 1 35(a)(3) of EPACT 2005 amends section 321 of SPCA by adding section

321(32), which defines the term "battery charger" as a "device that charges batteries for

consumer products, including battery chargers embedded in other consumer products." (42

U.S.C. 6291 (32)) Section 135(a)(3) of EPACT 2005 also amends section 321 of EPCA by

adding section 321(36), which defines the term "external power supply " as "an external power

supply circuit that is used to convert household electric current into DC [direct current] or lowervoltage AC [alternating current] to operate a consumer product ." (42 U.S.C. 6291 (36)) DOE

adopted these two definitions into Title 10 of the Code of Federal Regulations. Part 430 (10 CFR

Part 430) in a Federal Register notice published on December 8, 2006 . 71 FR 71365-71366.

While the EPCA definitions provide some clarity as to which devices should be classified

as a BC and which should be classified as an EPS, DOE recognizes that there are some consumer

products (e.g., laptop computers, video cameras, etc.) that incorporate both a BC and an EPS

under the scope of the EPCA definitions. In these cases, DOE will have to determine whether

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EERE-2006-DET-0136 COMMENT 04.3
these consumer products will be subject to two standards or whether a single standard can be

applied with criteria developed to provide clear guidance as to whether the consumer product is

classified as a BC or an EPS. In addition, under EPACT 2005 DOE was also granted author

to establish two standards for one product that serves two major functions . Some power

y:

conversion devices perform two major functions (i.e., those functions of a BC and those of an

EPS), and therefore the devices could be classified as both a BC and an EPS. For these products,

DOE will have to determine whether these consumer products should be subject to two standards

(i.e., one standard for each major function) or whether a single standard can be applied with

criteria developed to provide clear guidance as to whether the consumer product is classified as a

BC or an EPS. DOE is actively soliciting stakeholder comment on the issue of multiple

standards for some consumer products. This issue is discussed in detail in section 4 of The

Current and Projected Future Market for Battery Chargers and External Power Supplies.

1.3 Summary of DOE's Proposed Test Procedures

Section 325(u)(I)(B) of EPCA directs the Secretary, in establishing test procedures for BCs and

EPSs. "to consider existing definitions and test procedures used for measuring the energy

consumption in standby mode and other modes." (42 U.S.C. 6295(u)(1)(B)(i)) As discussed

earlier in this document. DOE adopted the EPCA definitions and ENERGY STAR test

procedures for BCs and EPSs in its final rule notice published on December 8, 2006. 71 FR

71340. In this rulemaking process, DOE stated that it elected to address BCs and EPSs

separately because (l) the nature and operation of these products is different; (2) they have

separate and discrete utilities to the consumer; (3) the Environmental Protection Agency (EPA)

developed separate ENERGY STAR test procedures and program requirements for these

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EERE-2006-DET-0136 COMMENT 04.3
products; and (4) several stakeholders participating in the development of the EPA's ENERGY

STAR program called for separate treatment of these products. 71 FR 42190.

For BCs, DOE adopted sections 4 and 5 of the ENERGY STAR "Test Methodology for

Determining the Energy Performance of Battery Charging Systems," December 2005. DOE

determined that this ENERGY STAR test method provided sufficient detail, tolerances, and a

test protocol to measure the energy consumption of BCs, as required under section 325(u)(1)(A)

of EPCA. (42 U.S.C. 6295(u)(l)(A)) Additionally, DOE also believes that this test procedure

has a reasonable degree of industry support, based on comments submitted to the EPA, as well as

the public comment process that EPA and its contractors engaged in while developing the

ENERGY STAR test procedure. Copies of these stakeholder comments can be found on the

EPA's website.3 In the final rule, DOE noted that the December 2005 ENERGY STAR test

procedure for battery charging systems does not include a module for measuring energy

consumed during active mode (i.e., when the battery is charging). DOE therefore added and

reserved a section in the CFR for active mode energy consumption measurement. DOE intends

to continue working cooperatively with stakeholders to evaluate test procedures for BCs in active

mode.

In the adopted ENERGY STAR test procedure, the BC and battery are evaluated together as a

system to determine the amount of energy that is passed from the mains (i.e., household walloutlet) to the consumer product via the BC and battery, as shown in Figure 1.2.

EPA's website documenting the development of the ENERGY STAR battery charging systems specification and

test procedure, including stakeholder comments:

littp://www.energystai-.gov/index.cfiii?c=neN,,, specs.ba tterychargerdevelopment

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EERE-2006-DET-0136 COMMENT 04.3
CM ins Charger Battery Consumer

Battery

Energy In (13 C) Energy Out product

Figure 1.2 Energy Transfer in a Battery Charging System

The BC test procedure measures the sum of the power consumed by the BC in battery

maintenance mode and standby mode4 over specified time periods. This measured power

consumption, called the accumulated nonactive energy, or Ea, is normalized by the battery

energy, Eb, in watt-hours, produced by the battery at a constant current of 0.2C5 from maximum

voltage to cut-off voltage. Energy input and output are combined into an efficiency metric called

the "nonactive energy ratio", ER:

Eq. 1-1

where Ea is the energy consumed, in watt-hours, by a BC during 36 hours in maintenance mode

followed by 12 hours in no-load mode (see Figure 1.3). For a given battery voltage, the

nonactive energy ratio gives a relative measure of the efficiency of a battery charging system.

4 Standby mode means the mode of operation when the battery charger is connected to the main electricity supply

and the battery is not connected to the charger.

The term "0.2C" describes the rate at which a battery is discharged. It represents the capacity obtained from a new

battery subjected to a constant-current discharge at room temperature. For example, draining a battery at I C means

to drain the capacity of a new battery completely in one hour.

1-16

EERE-2006-DET-0136 COMMENT 04.3
Mains

Energy In

Battery

Charger

(BC) No Energy Out

Figure 1.3. Energy Transfer in a Battery Charger Operating in No-load Mode

For external power supplies, DOE adopted sections 4 and 5 of the ENERGY STAR "Test

Method for Calculating the Energy Efficiency of Single-Voltage External Ac-Dc and Ac-Ac

Power Supplies (August 11, 2004)." DOE determined that this test procedure provides sufficient

detail, tolerances, and test protocols to measure the energy consumption of external power

supplies required under section 325(u) of EPCA. (42 U.S.C. 6295(u)) DOE also believes that

this test procedure has a reasonable degree of industry support, based on comments submitted to

the EPA and the public comment process that EPA engaged in while developing these test

methods. The paragraphs below briefly summarize the methodology followed in the EPS test

procedure.

In the EPS test procedure, efficiency is measured in active mode and the power

consumption is measured in no-load mode. For active mode, the test procedure records the

efficiency of the power supply at four loading conditions (i.e., 25 percent, 50 percent, 75 percent,

and 100 percent of maximum rated output power) and calculates the simple average efficiency.

For no-load mode, the power consumption of the device is measured when there is no load

connected to the output of the device.

1-17

EERE-2006-DET-0136 COMMENT 04.3
To conduct the active-mode test measurements, the EPS is attached to a test load with a

variable resistance, as shown in Figure 1.4.

Mains

Power In

External

Power

Supply

(EPS) Power Out

Test Load

Figure 1.4. Energy Transfer in an External Power Supply Under Test

The load resistance is adjusted so that the current going to the load is 25 percent, 50

percent. 75 percent, and 1 00 percent of maximum rated output current. At each loading

condition, the efficiency, 11Load Condition, is determined by:

where "Load-Condition" is 25 percent, 50 percent. 75 percent, or 100 percent. The efficiencies

of the EPS under all four load conditions determine the average efficiency, rlAve,,,ge:

772, +71sas; +177^y,+77ioni

4 Eq. 1-3

The measurement of no-load mode power consumption is the power consumed by the

EPS when it is connected to the mains (i.e., household wall-outlet) and nothing is connected to

the output, as shown in Figure 1.5.

1-18

EERE-2006-DET-0136 COMMENT 04.3
Mains

Power In

External

Power

Supply

(EPS) No Power Out

Figure 1.5 Power Transfer of an External Power Supply Operating in No-load Mode

For detailed information on the test procedures, stakeholders are encouraged to review

the notice of proposed rulemaking published on July 25, 2006 (71 FR 42178), the Final Rule

published on December 8, 2006 (71 FR 71340) and sections of the two ENERGY STAR test

procedures that were incorporated by reference.

Information regarding the test procedure rulemaking is maintained on the DOE Website

at:

http://www. eere.energy.gov/buildings/applian ce_standards/residential/battery_ex i erial.litrml.

EERE-2006-DET-0136 COMMENT 04.3
Issue Boxes: While DOE invites comments from stakeholders on all aspects of the material

presented in this document, there are several issues in particular on which DOE seeks comment

and that are identified in issue boxes such as this one. These issue boxes are used to highlight

certain issues and ask pertinent questions on the approaches that DOE intends to follow in

conducting the analyses applicable to the determination analysis, and potential standards

rulemaking. These comment boxes are numbered according to the order of appearance and are

listed together in Appendix C. Additional issues for stakeholder comment on the determination

analysis are also identified in the companion document published with this document, "The

Current and Future Market. far Battery Chargers and External Parer Supplies. "

1-20

EERE-2006-DET-0136 COMMENT 04.3
2. RULEMAKING ANALYSES

DOE will conduct a determination analysis rulemaking for BCs and EPSs. If the

Secretary makes a positive determination that energy conservation standards are warranted for

one or both of these products. DOE will initiate a rulemaking process to determine which, if any,

energy conservation standards would be technologically feasible, economically justified, and

would result in significant energy savings.

DOE's determination and the possible establishment of energy conservation standards are

two separate actions; however they share some analytical components. In other words, some of

the analysis that DOE will prepare in making its determination could be used for the energy

conservation standard, should that determination be positive. More specifically, a determination

analysis and an analysis for development of energy conservation standards both include a market

and technology assessment, screening analysis, engineering analysis. energy-use and end-use

load characterization, markups for equipment price determination, life-cycle cost and payback

period analysis, shipments analysis and national impact analysis. However, only an energy

conservation standard analysis includes a life-cycle cost sub-group analysis, manufacturer impact

analysis, utility impact analysis, net national employment impact analysis, environmental

assessment and regulatory impact analysis. Thus, for DOE's on-going determination analysis,

analytical work will focus on the analyses relevant to a detennination. If the Secretary makes a

positive detennination for one or both products, then DOE will review and revise these eight

analyses, and conduct the additional six analyses, during the energy conservation standards

rulemaking process.

2-1

EERE-2006-DET-0136 COMMENT 04.3
For the eight analyses that are common to both a determination analysis and energy

conservation standard, while they have the same general purpose. they do not represent the same

degree of analytical rigor. For example, a determination analysis considers just one candidate

standard level on which the Secretary would make a decision whether to proceed with energy

conservation standards. In the standards analysis, DOE typically considers multiple levels,

sometimes as many as six candidate standard levels, to evaluate the cost-effectiveness and

technical feasibility of small, incremental improvements in efficiency as well as significant

increases, such as the maximum technologically feasible level. Additionally, an LCC

spreadsheet for a determination will typically look at a few average cases while the LCC

spreadsheet of a standards rulemaking typically incorporates a Monte Carlo analysis, looking at

thousands of customers to get a more robust picture of the national impacts.

2.1 Components of a Determination Analysis Rulemaking

Figure 2.1 summarizes the analytical components of a determination analysis rulemaking

process. Each analysis (represented by the boxes with dark numbers) has a set of key inputs,

which are data and information required for the analysis. The numbers correspond to the section

numbers where these analyses are typically found. The "approaches" column are the methods

that could be used to obtain inputs for those analyses. for example, some key inputs exist in

public databases, while others could be collected from stakeholders or experts with special

knowledge. The DOE analytical team supporting the rulemaking may also develop key inputs

for the analyses. The results of each analysis are key outputs, which feed directly into the

rulemaking. The lines and arrows indicate the flow of information between the various analyses.

2-2

EERE-2006-DET-0136 COMMENT 04.3
Approaches Key Inputs*

Determination Analysis

Characterize Industry

Analysis of Market Dal

- Analysis of Product Data

• Efficiency-Level Approach

• Design Option Approach

• Analysis of Energy Use Data ; I,

• Define Distribution Channels

• Economic Census Data

Analysis

• Retail Price Collection and

Analysis

• Accounting Approach:

Backcast and Forecast:

Market Saturation

• Identify Firms/Products

• Historical Shipments

- Market Segmentation

Analyses* Key Outputs

• Non-Regulatory Programs Assessment

• Manufacturing Cost

• Efficiency / Performance

Energy Use and

End-Use Load

Characterization EnergyEfficiency

Levels

H

! -3

Product Classes 4 4Technology Options

Screening Analysis - Design Options

Design Options

Engineering Analysis n

^ • Cost-Efficiency Relationship

Design Energy

Annual Energy Use

Markups for Retail Price

Equipment Price

Determination (

• Energy Prices

• Installation Costs

• Maintenance 8 Re air Costs '

- Energy-Efficiency Levels

I

Shipments

Analysis I

• Energy Price Forecasts

• Site-to-Source Factors

? Dark boxes indicate Determination Analysis TSD chapters.

Life-Cycle Cost and

Payback Period

Analysis

• Candidate

Standard

Levels

UEC

• Energy Pric

National Impact

Analysis

• National Energy Savings

• Net Present Value

Figure 2.1. Flow Diagram of the Components of a Determination Analysis

2.2 Analyses for an Energy Conservation Standards Rulemaking

Figure 2 . 2 summarizes the analytical components of an energy conservation standardssetting process. The analyses are presented in the third column. Each analysis has a set of key

inputs. which are data and information required for the analysis . The "approaches " are the

methods that could be used to obtain key inputs . For example , some kev inputs exist in public

databases, while others could be collected from stakeholders or experts with special knowledge.

• Product Classes

• Market Structure

• Life-Cycle Costs

• Payback Periods

• Installation' Costs

• Maint. Costs

• Repair Cots

2-3

EERE-2006-DET-0136 COMMENT 04.3
The project team supporting the rulemaking would also develop key inputs. The results of each

analysis are key outputs. which feed directly into the rulemaking. The lines and arrows indicate

the flow of information between the various analyses.

EERE-2006-DET-0136 COMMENT 04.3
Approaches Key Inputs Analyses

• Identify FirmslProducls

• Characterize Industry Historical Shipments

• Markel Segmentation

• Analysis of Markel Data • Non-Regulatory Programs

Analysis of Product Data Product Prototype

• Efficiency-Level Approach

• Design Option Approach • Manufacturing Cost

• Analysis of Energy and

Water Use Date

• Define Distribution Channels

• Economic Census Data

Analysis

• Retail Price Collection and

Analysis

• EfficiencytPedarmance

r•tW Energy and

Water Use

Markups for

Product Price

Determination

Market and Technology

Assessment

Product Classes Technology Option

Screening Analysis

Des gn Option 1

Engineering Analysis

Design En

• Annual Energy Use (UEC)

• Annual Water Use (UWC)

Retail Prices

• Energy and Water Prices

Installation Costs

Maintenance 8 Repair Cost

• Energy-Efficiency Levels

• Accounting Approac

• Back cast and Foreca

• Market Saturation

Shipments

Analysis

• Energy Price Forecasts

• Site-to-Source Factors

• Manufacturer Prices

A-ge Costs

• National Energy Savings

• Net Present Values

• Conversion Capital Expenditures

• Direct Employment Impacts

dvunce Notice of prep osed Rulemaking (ANO

• Stakeholder Comments Revise ANOPR • That Standard Levels (TSLS)

Analyses TSL5

• Demographics Life-Cycle Cost

• Life-Cycle Costs

• Payback Periods

• Manufacturer Prices

Sub-Group Analysis • Industry Cash Flea

• Sub-Group Cash-Flow

• Average Costs • Direct Employment Impacts

Manufacturer Informs

M f t I t

• Competitive Impacts

GRIM A l i - f F D

anu ac urer mpac

A l i

• Cumulative Regulatory Burden

na ys s M clurer lnanoal al na ys s

NEMS-BT

• Utility Load Factors

National Energy Savinos Utility Impact

Dilecl Empioymenl

I mpacts

Analysis • Utility Impacts

• National Energy Savings

IMBUILD

• National Product Costs

- National Operating Costs Employment Impact

Analysis • National Employment Impacts

• NEMS-BT

- Emission Rates

• Nationel Energy saving Environmental Emission Estimate

Assessment

• Non-Regulatory

Aft ... live, Regulatory Impact • National Energy Savings

Analysis

• Net Present Values

• DD artment of Justice Review'

• Slakeholde^ Comments Revise Analyses

Key Outputs

F ---k Document

• Product Classes

• Technology Options

• Design Optie

• Cost-Efficiency Relationship

• Life-Cycle Costs

• Payback Periods

Notice of Proposed Rulemaking (NOPR)

• Revised Results

FIneLRule

Figure 2.2 Flow Diagram of Analyses for an Energy Conservation Standard Rulemaking

Energy-Efficiency

Levels

2-5

EERE-2006-DET-0136 COMMENT 04.3
2.2.1 Energy Conservation Standards Rulemaking Steps and Stakeholder

Participation

This section provides further detail on DOE's process for an energy conservation

standards rulemaking process. When DOE evaluates new or amended standards for "covered

products" under EPCA, it must consider seven statutory factors, to the greatest extent

practicable,, considering the following factors:

1) The economic impact of the standard on the manufacturers and consumers of the

affected product(s);

2) The savings in operating costs throughout the estimated average life of the

product(s) compared to any increases 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 product(s) likely to result

from the imposition 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. (42 U.S.C. 6295(o)(2)(B)(i))

Additional statutoy requirements for prescribing new or amended standards are set forth in

section 325(o). (42 U.S.C. 6295(o))

2-6

EERE-2006-DET-0136 COMMENT 04.3
The process for developing energy conservation standards involves analysis. public

notice, and consultation with interested parties. Such parties, collectively referred to as

stakeholders, include manufacturers. consumers, energy conservation and environmental

protection advocates, State and Federal agencies, and any other groups or individuals with an

interest in energy conservation standards and test procedures. DOE considers stakeholder

participation to be a very important part of the rulemaking process. DOE actively encourages the

participation and interaction of all stakeholders during the comment period of each rulemaking

stage. The broad array of stakeholders who provide comments promotes a balanced discussion

of critical information required to conduct the standards rulemaking, beginning with the public

comment on the Framework Document and continuing during subsequent comment periods.

In conducting the test procedure and energy conservation standards rulemakings, DOE

involves stakeholders through a variety of means, including public notifications (i.e.. Federal

Register notices). The standards rulemaking process generally involves three public notices,

which are published in the Federal Register. The first of the rulemaking notices is an advance

notice of proposed rulemaking (ANOPR) (see section 2.2.2). The ANOPR is designed to

publicly vet the models and tools that will be used in the rulemaking, and to facilitate public

participation before the proposed-rule stage. The second notice is a notice of proposed

rulemaking (NOPR) (see section 2.2.3), which presents a discussion of comments received in

response to the ANOPR; analysis of the impacts of standards on consumers, manufacturers, and

the Nation; DOE's weighting of the impacts; and the proposed standards. The third notice is the

final rule (see section 2.2.4), which presents a discussion of comments received in response to

the NOPR, the revised analysis of the impacts of standards, DOE's weighting of the impacts, the

2-7

EERE-2006-DET-0136 COMMENT 04.3
standards adopted by DOE and the basis for such standards , and the effective dates of the

standards.

2.2.2 Advance Notice of Proposed Rulemaking

As part of its initial rulemaking activity, DOE typically identifies product design options

or efficiency levels that it will analyze in detail, and those it should eliminate from further

consideration. This process includes a market and technology assessment (see Section 3) and a

screening analysis (see Section 4). These activities include consultations with stakeholders and

independent technical experts who can assist with identifying the key issues and design options

to be considered by DOE in the rulemaking. This Framework Document, the public meeting,

and the opportunity for comment on this Framework Document are all intended to initiate

dialogue with stakeholders and provide an opportunity for comment and input into the structure

and analytical approach proposed for any energy conservation standards rulemaking.

At the ANOPR stage. in addition to the market and technology assessment and screening

analysis, the other principal analyses that DOE presents include the engineering analysis (see

Section 5), the consumer L(C impact and payback period results (see Section 8), the national

energy savings (NES) and consumer net present value (NPV) results (see Section 10), and a

preliminary manufacturer impact analysis (see Section 12).

The ANOPR analysr^ includes candidate standard efficiency levels (CSLs) to facilitate

the stakeholder review of the spreadsheet models that underpin the analyses presented.

Stakeholder comments on the models are used to refine the CSLs for the NOPR stage of the

2-8

EERE-2006-DET-0136 COMMENT 04.3
rulemaking analyses, where DOE proposes trial efficiency standard levels for comment. In the

ANOPR stage, DOE's range of CSLs for analysis includes the maximum improvement in energy

efficiency that is technologically feasible and the efficiency level that corresponds to the

minimum LCC point. DOE generally considers efficiency levels or design options that span the

full range of technologically achievable efficiencies.

Relative to a baseline model (see section 3.4), the range of levels analyzed typically

includes:

• The highest energy efficiency level or lowest energy-consumption level that is

technologically feasible (the "max tech" level);

® The level with the lowest LCC; and

® Levels that incorporate noteworthy technologies or fill in large gaps between efficiency

levels of other levels considered.

DOE makes available for review on its website, at

http://www.eere.energy.gov/buildings/appliance_standards/, the spreadsheet tools and results of

the ANOPR analysis, and considers any comments received. When DOE publishes the ANOPR.

it also makes available a technical support document (TSD) that contains details of the analyses

performed to date. Following publication of the ANOPR. DOE provides a 75-day public

comment period and holds a public meeting during the 75-day comment period. Throughout this

rulemaking stage.. DOE encourages stakeholders to develop joint recommendations for particular

energy conservation standards levels.

2-9

EERE-2006-DET-0136 COMMENT 04.3
2.2.3 Notice of Proposed Rulemaking

DOE begins the NOPR stage by reviewing and considering all the comments received

after the publication of the ANOPR. This may result in revisions or refinements to the ANOPR

analyses, including the engineering analysis and LCC analysis. DOE also conducts additional

economic impact analyses that generally include a consumer LCC sub-group analysis (see

Section l 1), a complete manufacturer impact analysis (see Section 12), a utility impact analysis

(see Section 13), an employment impact analysis (see Section 14), an environmental assessment

(see Section 15). and a regulatory impact analysis (RIA) (see Section 16).

This analytical process ends with the selection of proposed energy conservation levels

that are presented in the NOPR. DOE selects the proposed standard levels from the trial standard

levels (TSLs) analyzed during the NOPR phase of the rulemaking. The NOPR documents the

evaluation and selection of the proposed standard level(s), if any.

For each product class, DOE identifies the maximum technology (max tech) efficiency

level. If DOE proposes a level lower than the max tech efficiency level, the reasons for

eliminating higher levels beginning with the highest level considered will be explained. DOE

presents the analysis results in the NOPR and the analysis details in an accompanying TSD.

DOE considers many factors in selecting proposed standards, as described above in

section 2.2.1. These factors and criteria are contained in EPCA and take into consideration the

benefits, costs, and impacts of energy conservation standards. In addition, DOE encourages

2-10

EERE-2006-DET-0136 COMMENT 04.3
stakeholders to develop joint recommendations for standard levels. DOE carefully considers

such recommendations in its decision process.

When DOE publishes the NOPR. it provides the U.S. Department of Justice (DOJ) with a

copy of the NOPR and TSD, and solicits feedback on the impact of the proposed standard level

on competition. The DOJ reviews these standard levels in light of any lessening of competition

that is likely to result from the imposition of standards. DOE considers the determination on the

impacts of the proposed standard on competition in preparing the final rule. Tile NOPR is

followed by a 75-day public comment period that includes one public meeting. (42 U.S.C. 6295)

2.2.4 Final Rule

DOE may revise its analyses after considering public comments on the NOPR. In

response to public comments, DOE reviews the engineering and economic impact analyses and

proposed standards and considers modifications where necessary.

After the publication of the NOPR, DOE conducts a thorough review of all analyses

performed and of the TSLs. Final revisions to the analyses and TSLs are made as appropriate.

Before the final rule is issued, DOE considers DOJ comments on the NOPR relating to

the impacts of the proposed standard levels on competition to determine if changes to these

standard levels are needed.

2-11

EERE-2006-DET-0136 COMMENT 04.3
The standards rulemaking concludes with the publication of the Final Rule. DOE selects

the final standard levels based on the complete record of the standards rulemaking. The Final

Rule promulgates the final standard levels and their effective date and explains the basis for their

selection. The final rule is accompanied by a final TSD.

EERE-2006-DET-0136 COMMENT 04.3
3. MARKET AND TECHNOLOGY ASSESSMENT

The market and technology assessment represents DOE's understanding of the market,

the structure and function of BC and EPS, potential energy saving technologies and product

classes. The market and technology assessment is used throughout the analyses that support the

determination and, if there is a positive determination, the energy conservation standard

rulemaking. The initial assessment of the market and technology typically provide important

inputs for developing product classes and identifying technology design options to improve

product energy efficiency.

For BC and EPS. DOE has explicit statutory requirements to conduct a market

assessment and propose product classes. As noted in section 1.1 of this document, section 325

(u)(1)(B)(ii) directs DOE to "assess the current and projected future market for battery chargers

and external power supplies." (42 U.S.C. 6295(u)(l)(B)(ii)) Section 325(u) further directs DOE

to include "suggested product classes for energy conservation standards" in this assessment. (42

U.S.C. 6295(u)(1)(C)(ii))

DOE has begun developing its initial market and technology assessment in order to meet

the requirements of section 325. Stakeholders are invited to review and comment on DOE's

current understanding of the BC and EPS market and technology described in "The Current and

Projected Future Market for Battery Chargers and External Power- Supplies" document

published on DOE's website for this rulemaking.

3-1

EERE-2006-DET-0136 COMMENT 04.3
Issue 1. DOE invites input on its initial assessment and analysis of the BC and EPS markets and

technology. Specific invitations for comment on DOE's initial findings and understanding of the

market can be found in "The Current and Projected Future Market for Battery Chargers and

External Power Supplies."

3.1 Market Assessment

In the market assessment, Section 2 of "The Current and Projected Future Market for

Battery Chargers and External Power Supplies," DOE characterized both qualitatively and

quantitatively the structure of the markets for BC and EPS to the extent possible using available

data. It identified key market actors; mapped distribution channels, estimated market shares and

trends, and identified and described regulatory and non-regulatory initiatives likely to impact the

efficiency of BC and EPS. Data gathered for the market assessment will be used in the

determination analyses, particularly in the shipments analysis, which is in turn a key input for the

national impact analysis.

DOE is making its preliminary market assessment available to increase the probability

that critical stakeholder input is obtained early in the rulemaking process before the bulk of the

analysis is underway and to ensure the greatest speed and accuracy. DOE intends to revise and

expand the market assessment in the coming months and publish its complete market assessment

in conjunction with the Secretary's determination notice for these products.

3-2

EERE-2006-DET-0136 COMMENT 04.3
In developing this preliminary market assessment, DOE applied the ENERGY STAR

definition differentiating between a BC and an EPS. This approach is applied to the consumer

products discussed in this section of the report to facilitate stakeholder review and discussion.

DOE may review and revise this interpretation: of how products are classified as either a BC or

an EPS, or whether products either incorporating or serving both a BC and an EPS function

should be subject to two standards. For detail on this issue, stakeholders are encouraged to

review section 4 of "The Current and Projected Future Market for Battery Chargers and

External Power Supplies."

3.2 Technology Assessment

In the technology assessment, Section 3 of "The Current and Projected Future Market

.fbr Battery Chargers and External Power Supplies," DOE describes the differences between the

underlying technology of a battery charger and external power supply. The section discusses the

different applications for BC and EPS, examines from a systems level the various EPS functions,

and discusses critical components such as the raw supply and regulator circuit. The section also

presents potential technological and design improvements to enhance the energy efficiency of

BC and EPS. For each, efficiency is inherently tied to their modes of usage and the efficiency

improvement opportunities available in each mode. For EPS_ the greatest potential efficiency

increase is found by improving the quality of the EPS parts with the greatest losses. The quality

of parts is also a key aspect of BC efficiency improvements; however, the largest increases in BC

efficiency may in fact be available from reducing energy consumption when the BC is in

maintenance mode, delivering little or no power to the battery.

3-3

EERE-2006-DET-0136 COMMENT 04.3
DOE is making its preliminary technology assessment available to increase the

probability that critical stakeholder input is obtained early in the rulemaking process before the

bulk of the analysis is underway and to ensure the greatest speed and accuracy. DOE intends to

continue developing and expanding the technology assessment, as new data and information

becomes available. A final version of the technology assessment will be published in

conjunction with the Secretary's determination notice for these products.

3.3 Product Classes

Section 325(u)( 1)(C)(ii) requires that for BCs and EPSs, DOE provide "(ii) suggested

product classes for energy conservation standards." (42 U.S.C. 6295 (u)(1)(c)(ii))DOE is

complying with this requirement in Section 4 of the report titled "The Current and Projected

Future Market for Batterv Chargers and External Power Supplies." A brief discussion of DOE's

approach is provided here, and stakeholders are encouraged to review the draft proposal

presented in Section 4 of the other report, and provide comment to DOE.

DOE divides covered products into classes by (a) the type of energy used; and (b) the

capacity of the product or any other performance-related feature that justifies different standard

levels, such as features affecting consumer utility. (42 U.S.C. 6295(q)) For BCs and EPSs, the

type of energy used in all designs and models is electricity, so the first criterion is not a

differentiating characteristic. The second criterion, encompassing capacity or any other

performance-related features. does apply. and there are characteristics DOE is taking into

consideration in its draft proposal for product classes of these products.

3-4

EERE-2006-DET-0136 COMMENT 04.3
There are several capacity- and performance-related features of battery chargers that

could be used to classify products. including the charging method it employs (continuous

charging vs. terminating charging), the voltage of the battery or batteries it is intended to charge,

and/or the battery chemistry. Similarly, there are several capacity- and performance-related

features of external power supplies that could be used to classify products, including rated output

power, voltage regulation, output current (i.e., AC or DC), power factor correction and/or output

voltage. Finally, there are some power conversion devices which have a differentiating feature

in that they serve two major functions - both charging a battery and operating a consumer

product (e.g., laptop computer power supplies). For these devices, which (in conjunction with

the end-use consumer product) represent both a battery charger and an external power supply,

DOE may create a separate product class to acknowledge the fact that these devices are

performing two major functions and could not be optimized to perform each function (i.e., BC or

EPS) individually. Stakeholders are invited to comment on this issue in Chapter 4 of "The

Current and Projected Future Market for Batten Chargers and External Power Supplies."

3.4 Baseline Models

Once DOE defines product classes, it will select baseline models as reference points

against which DOE can measure changes resulting from energy conservation standards. The

baseline model represents the characteristics of equipment in a given product class and

encompasses commonly available products with features and performance characteristics such as

wattage. voltage, and chemistry. Typically, the baseline model would be a model that just meets

current required energy conservation standards. If no existing standards apply to a product, as is

3-5

EERE-2006-DET-0136 COMMENT 04.3
the case with battery chargers and external power supplies. DOE will select baseline models that

are typical of what is sold in the market today.

The baseline models are used to conduct the engineering analysis and the LCC and

payback-period analyses. To determine energy savings and changes in manufacturer selling

price, DOE will compare each of the more efficient battery chargers or external power supplies

(i.e., those designs that incorporate the design options to improve efficiency) with the baseline

model.

Issue 2. DOE invites stakeholders to recommend baseline models from each of the product

classes that would constitute good representative units for analysis.

EERE-2006-DET-0136 COMMENT 04.3
4. SCREENING ANALYSIS

The purpose of the screening analysis is to eliminate technology design options that

would not be considered in any rulemaking for BCs and EPSs. DOE eliminates technology

options according to four criteria, as noted below.

A screening analysis is both part of a determination analysis and an energy conservation

standards rulemaking. So, even though DOE is still determining whether to evaluate BCs and

EPSs for energy conservation standards, DOE will be developing a screening analysis as part of

the EPACT 2005-mandated determination analysis.

Through its own research and in consultation with interested parties, DOE will develop a

list of technology options for consideration. Initially, either the candidate design options or best

available technologies will encompass all those technologies that may be technologically

feasible. Following development of this initial list of technology options, DOE will review each

technology option or best available technology based on the following four criteria, as addressed

in sections 4(a)(4) and 5(b) of the Process Rule (Appendix A to Subpart C of 10 CFR Part 430):

I . Technological feasibility. Design options that are not incorporated in commercially

available products or in working prototypes will not be considered further.

2. Practicability to manufacture, install and service. If it is determined that mass

production of a design option or reliable installation and servicing of a design option

could not be achieved on the scale necessary to serve the relevant market by the time

4-1

EERE-2006-DET-0136 COMMENT 04.3
of the effective date of the energy conservation standard, then that design option will

not be considered further.

3. Impacts on product utility to consumers. If a design option is determined to have

significant adverse impact on the utility of the product to significant subgroups of

consumers, or result in the unavailability of any covered product with performance

characteristics (including reliability), features, size, capacities, and volumes that are

substantially the same as products generally available in the United States at the time

it will not be considered further.

4. Safety of technologies. If it is determined that a design option will have significant

adverse impacts on health or safety, it will not be considered further.

The reasons for eliminating any-technology options during the screening analysis will be

fully documented and published for stakeholder review and comment as part of the ANOPR.

EERE-2006-DET-0136 COMMENT 04.3
5. ENGINEERING ANALYSIS

After conducting the screening analysis, DOE performs an engineering analysis based on

the remaining design options that improve the efficiency of BCs and EPSs. This section

provides an overview of the engineering analysis (section 5. 1), discusses DOE's proposed

approach (section 5.2), and addresses manufacturer prices (section 5.3). proprietary designs

(section 5.4), and regulatory burdens that might affect the engineering analysis (section 5.5).

An engineering analysis is part of both a determination analysis and an energy

conservation standards rulemaking. So, even though DOE is still determining whether to

evaluate BCs and EPSs for energy conservation standards, DOE will be developing an

engineering analysis as part of the EPACT 2005-mandated determination analysis.

5.1 Engineering Analysis Overview

The purpose of the engineering analysis is to determine the relationship between the

manufacturers's selling price and the energy efficiency of BCs and EPSs. In determining the

price-efficiency relationship, DOE will estimate the increase in the manufacturer selling price

associated with technological changes that increase the efficiency of the baseline models. DOE

will develop cost estimates for the engineering analysis (which it will also use in the

manufacturer impact analysis in Section 12) from detailed data on the incremental costs of

material, labor, and overhead. DOE will develop separate engineering analyses for each of the

baseline models (see Section 3). DOE intends to develop industry-average, cost-efficiency

relationships for these products based primarily on manufacturer-supplied data. If needed, DOE

may supplement this analysis with its own cost estimates of specific design options.

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EERE-2006-DET-0136 COMMENT 04.3
Therefore. DOE seeks design, efficiency, and cost information to develop a detailed

understanding of the cost of improving the efficiency of the various baseline-model BCs and

EPSs. In addition, DOE must identify the model with the highest efficiency that is

technologically feasible within each product class (i.e., the max-tech model).

Issue 3. For each product class, DOE welcomes information on design options and incremental

manufacturing costs for several efficiency levels above the baseline, one of which would be max

tech. Detailed information on the product performance and the incremental manufacturing costs

(e.g., material costs,, labor costs,- overhead costs (excluding depreciation), building conversion

capital expenditures, tooling/equipment conversion capital expenditures, research and

development (R&D) expenses, and marketing expenses) would be welcome.

Material costs are the costs of raw materials, including scrap. that can be traced to final or end products. Direct

material costs do not include indirect material costs, which are attributed to supplies that may be used in the

production process but are not assigned to final products (e.g.. lubricating oil for production machinery).

a Labor costs include the earnings of workers who assemble parts into a finished good or operate machines in the

production process. Direct labor includes the fringe benefits of direct laborers such as group health care, as well as

overtime pay. Direct labor does not include indirect labor, which is defined as the earnings of employees who do

not work directly in assembling a product such as supervisors, janitors. stockroom personnel, inspectors, and forklift

operators.

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EERE-2006-DET-0136 COMMENT 04.3
5.2 Engineering Analysis Approach

For the engineering analysis, DOE will examine aggregated incremental increases in the

manufacturer production cost at specified efficiency levels. In support of this analysis, DOE

intends to collect incremental cost data from manufacturers. The cost data would represent the

average incremental production cost to improve the efficiency of a baseline model. DOE will

supplement the manufacturer-provided cost data with its own cost estimates of particular design

options. DOE intends to develop design-option cost estimates via consultation with industry

experts and industry representatives and/or further review of any available cost and performance

information. Thereafter, DOE will use the cost data that it collected for the engineering analysis

and apply it to the manufacturer impact analysis (see Section 12). If possible, DOE would then

aggregate the cost numbers by weighting each individual data point by company-level sales

volumes for each product class.

To be useful in the manufacturer impact analysis, manufacturer-cost information should

reflect any variability in baseline models, design strategies, and cost structures that exist among

manufacturers. If necessary, DOE will qualify any aggregated cost-efficiency data. Information

obtained through follow-up with manufacturers would assist this effort. These confidential

interviews will provide a deeper understanding of the various combinations of technologies used

to increase device efficiency, and their associated manufacturing costs.'

DOE will estimate the contribution of the depreciation of conversion-capital expenditures

to the incremental overhead. During the interviews with manufacturers, DOE intends to gather

" Information provided by a stakeholder that the stakeholder believes to be confidential must be submitted according

to 10 CFR 1004.11.

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EERE-2006-DET-0136 COMMENT 04.3
information about the capital expenditures needed to increase the efficiency of the baseline

models to various efficiency levels (i.e., conversion expenditures by efficiency). Also, DOE will

gather information about the depreciation method(s) used to expense the conversion

expenditures. DOE will maintain the confidentiality of proprietary data in accordance with 10

CFR 1004.11, while allowing the public to examine the cost and design assumptions that

underlie the cost-efficiency estimates.

Issue 4. DOE welcomes comments on the above-described approach to determining the

relationship between manufacturer selling price and device efficiency. Stakeholders are invited

to provide data to support their comments where appropriate.

5.3 Manufacturer Prices

DOE plans to apply markups to convert manufacturer production costs to manufacture

selling prices. DOE intends to estimate manufacturer markups from publicly available financial

information (e.g., Securities and Exchange Commission 10-K reports).

Issue 5. DOE welcomes comments on the markup approach proposed for developing estimates

of manufacturer selling prices.

EERE-2006-DET-0136 COMMENT 04.3
5.4 Proprietary Designs

DOE will consider in its engineering and economic analyses all design options that are

commercially available or present in a working prototype, including proprietary designs. DOE

will consider a proprietary design in the subsequent analyses only if it is not a unique path to a

given product efficiency level. If the proprietary design is the only approach available to achieve

a given efficiency level, then DOE would reject the efficiency level (that can only be achieved

by a proprietary design) from further analysis. Furthermore, DOE is sensitive to manufacturers'

concerns regarding proprietary designs, and will make provisions to maintain the confidentiality

of any proprietary data submitted by a manufacturer in accordance with 10 CFR 1004.1 1. This

information will provide input to the competitive impacts assessment and other economic

analyses.

Issue 6. DOE welcomes comments as to whether there are proprietary designs that DOE should

be aware of for BCs or EPSs under consideration by this rulemaking.

5.5 Outside Regulatory Changes Affecting the Engineering Analysis

In conducting an engineering analysis. DOE must consider the effects of regulatory

changes outside DOE's energy conservation standards rulemaking process which could impact

the manufacturers of the covered equipment. Some of these changes could also affect the

efficiency or energy consumption of the covered products. DOE will attempt to identify all such

outside engineering issues that could impact the engineering analysis. The consideration of these

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EERE-2006-DET-0136 COMMENT 04.3
issues is closely related to the cumulative regulatory burden assessment that DOE will carry out

as part of the manufacturer impact analysis.

Issue 7. DOE welcomes comments as to whether there are outside issues that DOE should

consider in its analysis of BCs and EPSs and the impact of such issues . Stakeholders are invited

to provide data to support their comments where appropriate.

EERE-2006-DET-0136 COMMENT 04.3
6. ENERGY-USE AND END-USE LOAD CHARACTERIZATION

The purpose of the energy-use and end-use load characterization is to identify the way in

which products are used by consumers, and thereby determine the energy-savings potential of

energy efficiency improvements. For the products in this rulemaking, this analysis will focus on

how consumers use BCs and EPSs with the consumer products they operate. An energy-use and

end-use load characterization is part of both a determination analysis and an energy conservation

standards rulemaking. DOE will begin developing this analysis as part of the determination

analysis.

The energy-use and end-use load characterization analysis, which is an input to the LCC

assessment and the national impact analysis, is intended to capture and represent the typical

energy consumption under real world conditions. This use profile enables DOE to conduct a

calculation to determine the LCC and the payback period of more efficient technologies relative

to the baseline product.

DOE seeks to identify and obtain detailed data on the typical applications and end-use

profiles for BCs and EPSs considered in this rulemaking. If the range of energy use determined

for each product is large enough, DOE will conduct a sensitivity analysis to determine how high

and low estimates of energy use might impact the economic feasibility of any energy

conservation standard.

Issue 8. DOE welcomes recommendations on sources of data that would provide end-use

operating profiles for BCs and EPSs covered under this rulemaking.

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EERE-2006-DET-0136 COMMENT 04.3
7. MARKUPS FOR EQUIPMENT PRICE DETERMINATION

This analysis is part of both a determination analysis and an energy conservation

standards rulemaking. DOE will begin developing markups for equipment price determination

as part of the determination analysis.

DOE uses manufacturer-to-consumer markups to convert the manufacturer selling-price

estimates from the engineering analysis to consumer prices. DOE then uses these markups in the

LCC analysis, consumer payback period analysis, and national impact analysis. Retail prices are

needed for the baseline efficiency level and all other efficiency levels under consideration. DOE

will obtain these retail prices by applying manufacturer-to-consumer markups to manufacturer

selling-price estimates. To validate these markups, DOE will attempt to collect data on existing

prices in the market either by purchasing large data sets or by downloading data from distributor

websites.

Before it can develop markups, DOE must identify distribution channels (i.e., how a BC

or an EPS is distributed from the manufacturer to the consumer). Once it establishes proper

distribution channels for each of the product types, DOE will rely on economic census data from

the U.S. Census Bureau. as well as input from industry and subject matter experts, to develop an

understanding of the markups applied as the product moves from the manufacturer to the

consumer. To the extent possible, DOE also will use collected retail-price data to determine

overall manufacturer-to-consumer markups.

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EERE-2006-DET-0136 COMMENT 04.3
This analysis will generate retail prices based on the marked-up manufacturing prices

from the engineering analysis. Because DOE expects to generate a range of price estimates. it

plans to describe new retail prices within a range of uncertainty. If the range of retail prices for

each product is large enough, DOE will conduct a sensitivity analysis to determine how high and

low estimates of retail price might impact the economic feasibility of any potential amended

energy conservation standard.

Issue 9. DOE welcomes comments on the distribution channels for BCs and EPSs, the key

stakeholders in those distribution channels, the typical markups applied by those stakeholders,

and the overall markup from manufacturer selling price to retail shelf.

EERE-2006-DET-0136 COMMENT 04.3
8. LIFE-CYCLE COST AND PAYBACK PERIOD ANALYSIS

The effects of increased energy conservation standards on consumers include a change in

operating expense (usually decreased) and a change in purchase price (usually increased). In

carrying out rulemakings for other products, DOE has analyzed the net effect on consumers by

calculating the LCC and payback period analyses using the engineering performance data

(Section 5), the energy-use and end-use load characterization data (Section 6), and the equipment

retail prices (Section 7). Inputs to the LCC calculation include the installed cost to the consumer

(purchase price plus installation cost), operating expenses (energy expenses, and, if applicable,

repair costs, and maintenance costs), the lifetime of the product or other defined period of

analysis, and a discount rate.

An LCC analysis is part of both a determination analysis and an energy conservation

standards rulemaking. DOE will begin developing an LCC analysis as part of the determination

analysis.

For the determination, DOE will conduct the LCC analysis using inputs that reflect

conditions in the field for product retail price and life. energy costs, energy use, and discount

rates. If DOE determines that there is significant variability in any of the above inputs, it will

conduct sensitivity analyses to determine how the LCC and payback period are impacted by high

and low estimates for each of the inputs. For any sensitivity analyses that it conducts, DOE will

account for correlations that may exist between inputs (e.g., energy use may be correlated to

energy prices). A detailed impact calculation on subgroups of consumers would only be

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EERE-2006-DET-0136 COMMENT 04.3
conducted as part of an energy conservation standards rulemaking, and would be conducted after

the ANOPR (see Section 11).

Based on the results of the LCC analysis, DOE would select CSLs for the ANOPR

analysis. The range of CSLs typically will include the product efficiency level with the lowest

LCC, the highest efficiency level that is technologically feasible, and other levels DOE has not

yet determined.

For the NOPR, DOE would carefully review all of the comments it received on the

ANOPR LCC analysis, make any necessary revisions to the analysis, and evaluate additional

parameters not included in the ANOPR analysis, if necessary.

For BCs and EPSs, DOE needs to determine input values for several variables. The

-following sections discuss the-methodologies DOE plans to use to develop energy prices,

discount rates, and product lifetimes.

8.1 Energy Prices

For consumers of BCs and EPSs, DOE will review residential energy price data from the

Energy Information Administration (EIA) as a means for establishing electricity prices . If the

EIA data demonstrate a large variability in electricity prices, DOE will conduct a sensitivity

analysis to determine how high and low electricity price estimates might impact the economic

feasibility of any amended energy conservation standards. DOE will use projections of nationalaverage energy prices for residential consumers to estimate future energy prices in its LCC

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EERE-2006-DET-0136 COMMENT 04.3
analysis. DOE will use EIA's Annual Energy Outlook (AEO) as the principal source of

projections for future electricity prices.

Issue 10. DOE welcomes input on the proposed methodology for estimating current and future

electricity prices.

8.2 Life-Cycle Cost Discount Rates

The calculation of consumer LCC requires the use of an appropriate discount rate. For

residential consumers, DOE plans to use the same approach that it relied on to develop discount

rates for its rulemaking on residential furnaces and boilers-i.e., derive the discount rates from

estimates of the interest or "finance cost" to purchase residential products. By applying financial

theory, the finance cost of raising funds to purchase residential products can be interpreted as (1)

the financial cost of any debt incurred to purchase residential products. principally interest

charges on debt, or (2) the opportunity cost of any equity used to purchase residential products,

principally interest earnings on household equity. Household equity is represented by holdings

in assets such as stocks and bonds, as well as the return on homeowner equity. DOE would

obtain much of the data required to determine the cost of debt and equity fi-otn the Federal

Reserve Board's triennial Survey of Consumer Finance. 2004.

DOE will publish the discount rates and associated documentation on the derivation of

these discount rates at the time of the ANOPR publication . Stakeholders will be invited to

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EERE-2006-DET-0136 COMMENT 04.3
comment specifically on the issue of consumer discount rates during the ANOPR comment

period.

Issue 10 . DOE welcomes input on the proposed approaches for estimating discount rates for

consumers of BCs and EPSs covered under this rulemaking.

8.3 Product Lifetimes

DOE will use information from catalogues and various literature sources, as well as input

from manufacturers and other stakeholders, to establish product lifetimes for use in the LCC and

subsequent analyses.

Based on consideration of the comments received for the ANOPR, DOE will make

necessary changes to the analysis. These changes will be reflected in the documentation of the

NOPR.

Issue 11. DOE welcomes comments on appropriate product lifetimes for BCs and EPSs.

EERE-2006-DET-0136 COMMENT 04.3
9. SHIPMENTS ANALYSIS

Shipment forecasts are required in order to calculate the national impacts of energy

conservation standards on energy, net present value (NPV), and future manufacturer cash flows.'

DOE plans to develop shipment forecasts based on an analysis of key market drivers for the

covered products. Principal among these drivers is demand for the consumer products that use

BCs and EPSs.

A shipments analysis is part of both a determination analysis and an energy-conservation

standards rulemaking. DOE will begin developing a shipments analysis as part of the

determination analysis.

9.1 Base-Case Forecast

- ----To-evaluate the various impacts-of standards, DOE must develop a base-caseforecast

against which to compare forecasts for higher efficiency levels. The base-case forecast is

designed to depict what would happen to energy consumption and energy costs over time if DOE

does not adopt new or amended energy conservation standards for the products covered under

this rulemaking. In determining the base-case forecast, DOE will consider historical shipments,

the mix of product efficiencies sold, and how that mix might change over time. For these

purposes. DOE needs data on historical product shipments and the market shares of the different

efficiency levels offered in each product class.

DOE proposes to use shipment forecasts published by the Darnell Group, and end-use

product sales data published by the Consumer Electronics Association (CEA), as the initial

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EERE-2006-DET-0136 COMMENT 04.3
points of reference for evaluating and projecting shipment volumes for each product class. DOE

will use these data to create a forecast of shipment volumes by product class.

Also, DOE hopes to collect market-share efficiency data (i.e., data on the distribution of

product shipments), if applicable, for each product class. DOE recognizes that this information

may be difficult to collect and, therefore. may consider other methods for estimating the

efficiency distribution in the market. For instance , if market-share efficiency data are not

available , DOE may develop, as a proxy. efficiency distributions based on available BC and EPS

test data and input from industry , technical experts, or other sources. DOE then will combine

shipment forecasts with market -share efficiency data or efficiency distributions for each product

class to create the base-case shipments forecast.

9.2 Accounting Methodology

DOE proposes to determine annual shipments in the base case by accounting for trends in

the markets for consumer electronics . In broad terms, there are four factors that will contribute

to changes over time in the demand for BCs and EPSs:

1. Changing demand for products in existing consumer product categories - driven by

changes in preferences, level of affluence , and population size;

2. Convergence of consumer product categories - such as when mobile phones are

combined with PDAs. As a result of convergence , some consumers may have fewer

devices than they would otherwise, thus reducing the demand for BCs or EPSs;

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EERE-2006-DET-0136 COMMENT 04.3
3. Emergence of new consumer product categories a critical factor, given the rapid

pace of change in the consumer electronics market; and

4. Shifts between methods for supplying power to consumer products - internal power

supplies, external power supplies, primary batteries, rechargeable batteries, USB

systems, and others. This would include development of new power supply

technology, such as fuel-cell energy systems.'

In assessing the contributions of the four factors,.. DOE will review industry literature,

conduct a patent search, and discuss market trends with manufacturers, as well as marketing and

technical experts, knowledgeable in this technology.

Issue12- DOE welcomes coiiinents on, And any- informal Ion concerning: the four factors

described above for projecting over time annual shipments of BCs and EPSs.

9.3 Standards Impacts on Product Shipments

For each set of standards analyzed, DOE will develop one set of shipment forecasts for

BCs and a separate set of shipment forecasts for EPSs. These standards-case forecasts will be

used to evaluate the impacts of standards on shipments of BCs and EPSs. Standards-case

forecasts are derived using the same data sets as base-case forecasts. However, because the

' Fuel cells are expected to be developed in a very small farm-factors. such that they can be used in conjunction with

portable electronic devices. Consumers would "recharge" their products by adding additional electrolytic fluid to

the fuel cell rather than plugging the device into charger.

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EERE-2006-DET-0136 COMMENT 04.3
standards-case forecasts take into account the increase in purchase price and the decrease in the

consumer's cost of operating the more efficient product caused by standards, standards-case

shipment forecasts typically deviate from those for the base case. The size of the difference

between two forecasts depends on the estimated purchase-price-increase, as well as the

operating-cost savings from the standard.

In addition, for products considered in this rulemaking, DOE will take into consideration

substitute products that may become more popular under various standards scenarios. For

example, if DOE sets a standard for EPSs but not for BCs, there might be a migration in some

product categories away from models that use EPSs and toward those that use BCs. Because the

purchase price tends to have a larger impact than operating cost on equipment purchase

decisions, standards-case forecasts typically do show an elasticity of demand, manifested as a

drop in shipments relative to the base case.

Market-pull programs, such as the ENERGY STAR program and consumer rebate

programs, that encourage the purchase of more efficient products, and market-push programs,

such as manufacturer tax credits, that encourage the production of more efficient products, also

affect standards-case forecasts. When such programs exist, DOE considers their impacts on both

standards-case and base-case forecasts.

Issue 13. DOE welcomes comments on how standards for BCs or EPSs might impact BC and

EPS shipments. DOE also invites input on the expected impacts of market-pull programs that

promote the adoption of more efficient BCs or EPSs.

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EERE-2006-DET-0136 COMMENT 04.3
Issue 14. DOE welcomes input on BC and EPS shipments forecasts. See issues 28 and 29 in the

Current and Projected Future Markets document for related invitations for comment.

EERE-2006-DET-0136 COMMENT 04.3
10. NATIONAL IMPACT ANALYSIS

Methods for estimating the LCC savings and payback period for individual consumers

were discussed earlier in Section 8. Section 10 discusses DOE's assessment of the aggregate

impacts at the national level. Measures of impact to be reported include the NPV of total

consumer LCC and NES.

A national impact analysis is part of both a determination analysis and an energy

conservation standards rulemaking. DOE will begin developing a national impact analysis as

part of the determination analysis.

10.1 Inputs to Forecasts

Analyzing impacts of Federal energy conservation standards requires a comparison of

projected United-States-energy. consumption with, and without, new or amended energy -

conservation standards. The forecasts contain projections of unit energy consumption of new

BCs and EPSs, annual equipment shipments, and the price of purchased equipment. Approaches

to determining unit energy consumption are described in Section 6, methods for deriving basecase shipment forecasts are discussed in Section 9, and approaches to determining retail prices

for products are described in Section 7.

10.2 Calculation of Energy Savings

DOE intends to calculate national energy consumption for each year beginning with the

expected effective date of the standards. It will calculate national electricity consumption for the

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EERE-2006-DET-0136 COMMENT 04.3
base case and each standard level analyzed . DOE plans to perform this calculation through the

use of a spreadsheet model that effectively multiplies annual shipment forecasts by unit energy

savings, thereby accounting for the stock of products affected by standards.

In response to comments by stakeholders who asked for a simple, transparent model,

DOE developed NES spreadsheet models for its standards rulemakings starting in 1996. DOE's

NES spreadsheet model will provide reasonable, stand-alone forecasts of NES and NPV both for

BCs and EPSs.

In other rulemakings, DOE has prepared NES spreadsheet models to project energy

savings and to demonstrate how improvements in energy efficiency can be accounted for over

time. Similar models will be developed for BCs and EPSs.

Issue 15. DOE welcomes comments on the NES spreadsheet models used for estimating

national impacts of energy conservation standards.

10.3 Net Present Value

DOE calculates the national NPV of the energy conservation standards in conjunction with the

NES. It calculates annual energy expenditures from annual energy consumption by

incorporating forecasted energy prices. DOE calculates annual equipment expenditures by

multiplying the price-per-unit times the forecasted shipments. The difference between a basecase and a standards-case scenario typically contributes to an NES offset against increased

expenditures on more efficient BCs and EPSs. The difference each year between energy bill

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EERE-2006-DET-0136 COMMENT 04.3
savings and increased equipment expenditures is the net savings (if positive) or net costs (if

negative). DOE discounts these annual values to the present time and sums them to give an

NPV. According to U.S. Office of Management and Budget (OMB) requirements, DOE will

conduct two NPV calculations: one using a real discount rate of three percent and the other

using a real discount rate of seven percent (OMB, Circular A-4: Regulatory Analysis, 2003).

Based on consideration of the comments received for the ANOPR, DOE will make any

necessary changes to the analysis and CSLs.

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11. LIFE-CYCLE COST SUBGROUP ANALYSIS

A life-cycle cost subgroup analysis is only part of an energy conservation standards

rulemaking ; therefore this analysis would only be conducted if DOE decides to evaluate BC

and/or EPS for energy conservation standards.

This section describes how DOE analyzes consumer impacts by dividing consumers into

subgroups and accounting for variations in key inputs to the LCC analysis. A consumer

subgroup comprises a subset of the population that is likely, for one reason or another, to be

impacted disproportionately by new or revised energy conservation standards. The purpose of a

subgroup analysis is to determine the extent of this disproportional impact. DOE will work with

stakeholders early in the rulemaking process to identify any subgroups for this consideration,

should DOE determine to proceed with a standards rulemaking. However, it will not analyze the

consumer subgroups until the NOPR stage of the analysis.

In comparing potential impacts on the different consumer subgroups, DOE will evaluate

variations in regional electricity prices , variations in use profiles, and variations in installation

costs that might affect the NPV of an energy conservation standard for certain consumer

subgroups. To the extent possible , DOE may obtain estimates of the variability in each input

variable and consider this variability in its calculation of consumer impacts . It will discuss with

stakeholders the variability in each input variable and likely sources of information.

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12. MANUFACTURER IMPACT ANALYSIS

A manufacturer impact analysis is only part of an energy conservation standards

rulemaking; therefore, this analysis would only be conducted if DOE decides to evaluate BCs

and/or EPSs for energy conservation standards.

The analysis of impacts on manufacturers is intended to provide DOE with an assessment

of the potential impacts of energy conservation standards on manufacturers of BCs and EPSs.

DOE will conduct a separate manufacturer impact analysis for each of the product types covered

under this rulemaking should DOE determine to proceed with a standards rulemaking. In

addition to financial impacts, a wide range of quantitative and qualitative effects may occur

following adoption of a standard that may require changes to the manufacturing practices for

these products. DOE would identify these effects through interviews with manufacturers and

other experts.

12.1 Sources of Information for the Manufacturer Impact Analysis

Many of the analyses described earlier provide important information that DOE uses as

inputs for the manufacturer impact analysis. Such information includes financial parameters

developed in the market assessment (section 3.1), manufacturing costs and prices from the

engineering analysis (sections 5.2 and 5.3), retail price forecasts (Section 7), and shipments

forecasts (Section 9). DOE supplements this information with information gathered during

manufacturer interviews. The interview process plays a key role in the manufacturer impact

analysis, since it provides an opportunity for interested parties to express their views on

important issues.

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DOE would conduct detailed interviews with manufacturers to gain insight into the range

of potential impacts from standards. During the interviews, DOE would take note of information

on the possible impacts on manufacturing costs, equipment prices, sales, direct employment,

capital assets, and industry competitiveness. Both qualitative and quantitative information is

valuable. DOE would schedule interviews well in advance to provide every opportunity for key

individuals to be available.

DOE would ask interview participants to identify all confidential information provided in

writing or verbally. It would consider the information gathered, as appropriate, in the energy

conservation standard decision-making process. DOE also would ask participants to identify any

information that they wish to have included in the public record, but that they do not want to

have associated with their interview. DOE would incorporate this information into the public

record, but would report it without attribution.

DOE would collate the interview results and prepare a summary of the major issues and

outcomes. This summary would become part of the TSD for this rulemaking.

12.2 Industry Cash Flow Analysis

The industry cash flow analysis relies primarily on the Government Regulatory Impact

Model (GRIM). DOE uses GRIM to analyze the financial impacts of more stringent energy

conservation standards on the industry that produces the products covered by the standard.

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The GRIM analysis uses a number of factors-annual expected revenues; manufacturer

costs, such as costs of goods sold; selling, general, and administrative costs; taxes; and capital

expenditures (both ordinary capital expenditures and those related to standards)-to arrive at a

series of annual cash flows beginning from the announcement of the new energy conservation

standard and continuing for several years after its implementation. DOE compares the results

against base-case projections that involve no new standards. The financial impact of new

standards is then the difference between the two sets of discounted annual cash flows. Other

performance metrics, such as return on invested capital, also are available from GRIM.

DOE would gather this information from two primary sources: the analyses conducted to

this point, and interviews with manufacturers and other stakeholders. Information gathered from

previous analyses would include financial parameters, manufacturing costs, price forecasts, and

shipments forecasts. Interviews with manufacturers and other stakeholders would be essential in

supplementing this information.

12.3 Manufacturer Subgroup Analysis

It is possible that the use of average industry cost values would not adequately assess

differential impacts among subgroups of BC and EPS manufacturers. DOE recognizes that

smaller manufacturers, niche players, and manufacturers exhibiting a cost structure that differs

largely from the industry average may be impacted differently by the imposition of energy

conservation standards. Ideally, DOE would consider the impact on every firm individually. In

highly concentrated industries, this may be possible. In industries having numerous participants,

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however, DOE would use the results of the market and technology assessment to group

manufacturers into subgroups, as appropriate.

12.4 Competitive Impacts Assessment

Section 325(o)(2)(B)(i)(V) directs DOE to consider any lessening of competition that is

likely to result from an imposition of standards. (42 U.S.C. 6295(o)(2)(B)(i)(V)) Further, EPCA

directs the Attorney General to determine in writing, the impacts, if any, of any lessening of

competition. (42 U.S.C. 6295(o)(2)(B)(ii)) DOE would make a determined effort to gather firmspecific financial infornation and impacts. DOE would then report the aggregated impact of the

standard on manufacturers. The competitive analysis would focus on assessing the impacts to

smaller, yet significant, manufacturers. DOE would provide the Attorney General with a copy of

the NOPR for consideration in his evaluation of the impact of energy conservation standards on

the lessening of competition. DOE would base the assessment on manufacturing cost data and

on information collected from interviews with manufacturers. The manufacturer interviews

would focus on gathering information that would help in assessing asymmetrical cost increases

to some manufacturers, increased proportion of fixed costs potentially increasing business risks,

and potential barriers to market entry (e.g., proprietary technologies).

12.5 Cumulative Regulatory Burden

DOE is aware that other regulations may apply to products covered under this

rulemaking, as well as to other equipment produced by the same manufacturers of products

covered under this rulemaking. Multiple regulations may result in a cumulative regulatory

burden on these manufacturers. DOE would seek to limit the overlapping effects on

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EERE-2006-DET-0136 COMMENT 04.3
manufacturers of DOE standards and other regulatory actions affecting the types of covered

product.

EERE-2006-DET-0136 COMMENT 04.3
13. UTILITY IMPACT ANALYSIS

A utility impact analysis is only part of an energy conservation standards rulemaking;

therefore, this analysis would only be conducted if DOE decides to evaluate BCs and/or EPSs for

energy conservation standards.

To perform the utility impact analysis, which would include an analysis of the electric

utility industry, DOE plans to use a variant of the EIA's National Energy Modeling System

(NEMS), called NEMS-BT (BT is DOE's Building Technologies Program). The NEMS is a

large, multi-sector partial-equilibrium model of the U.S. energy sector, used primarily for the

purpose of preparing the AEO. The NEMS-BT produces a widely recognized reference-case

forecast for the United States through 2030, which is available in the public domain. Outputs of

the utility analysis can parallel results that appear in the latest AEO, with some additions.

Typical outputs include forecasts of sales, price, and avoided capacity. DOE plans on

conducting the utility impact analysis as a scenario departing from the latest AEO reference case.

In other words, the energy-savings impacts from amended energy conservation standards would

be modeled using NEMS-BT to generate forecasts that deviate from the AEO reference case.

EERE-2006-DET-0136 COMMENT 04.3
14. EMPLOYMENT IMPACT ANALYSIS

An employment impact analysis is only part of an energy conservation standards

rulemaking; therefore, this analysis would only be conducted if DOE decides to evaluate BCs

and/or EPSs for energy conservation standards.

The imposition of standards can impact employment both directly and indirectly. Direct

employment impacts are changes in the number of employees at the factories that produce the

covered BC and EPS products, along with any affiliated distribution and service companies.

DOE would evaluate direct employment impacts in the manufacturer impact analysis, as

described in Section 12. Indirect employment impacts may result from expenditures shifting

between goods (the substitution effect) and changes in income and overall expenditure levels

(the income effect) that occur due to the imposition of standards. The combined direct and

indirect employment impacts would be investigated in the employment impact analysis using

DOE's "Impact of Sector Energy Technologies" (ImSET) model. The ImSET model was

developed for DOE's Office of Planning, Budget, and Analysis, and estimates the employment

and income effects of energy-saving technologies in buildings, industry, and transportation. In

comparison with simple economic multiplier approaches, ImSET allows for more complete and

automated analysis of the economic impacts of energy-efficiency investments.

EERE-2006-DET-0136 COMMENT 04.3
15. ENVIRONMENTAL ASSESSMENT

An environmental assessment is only part of an energy conservation standards

rulemaking ; therefore, this analysis would only be conducted if DOE decides to evaluate BCs

and/or EPSs for energy conservation standards:

The primary environmental effects of energy conservation standards for BCs and EPSs

are likely to be reduced emissions resulting from reduced electricity consumption. An

environmental analysis would track the impact of possible standards on three types of energyrelated emissions: carbon dioxide (CO2), oxides of nitrogen (NO,), and sulfur dioxide (SO2).

DOE intends to base these calculations on the NEMS-BT modeling work proposed for the utility

impact analysis. This approach has the advantage of examining the marginal impact of standards

for BCs and EPSs on the utility generation mix and the subsequent environmental emissions.

Carbon emissions are tracked in NEMS-BT by a detailed module that produces robust

results because of its broad coverage of all sectors and inclusion of interactive effects. The

NEMS-BT also includes a module for SO2-allowance trading and delivers a forecast of SO2-

allowance prices. It is important to note that simulation of SO2 trading tends to imply that the

physical effects of emissions would be zero. However. there is an SO2 benefit from energyconservation standards in the form of a lower emission pennit price and, if big enough to be

calculable by NEMS, this value can be reported. The NEMS-BT also has an algorithm for

estimating NO, emissions from power generation.

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EERE-2006-DET-0136 COMMENT 04.3
16. REGULATORY IMPACT ANALYSIS

The RIA is only part of an energy-conservation standards rulemaking; therefore, this

analysis would only be conducted if DOE decides to evaluate BCs and/or EPSs for energyconservation standards.

Under section 12 of appendix A to subpart C of the Process Rule, DOE is committed to

exploring non-regulatory alternatives to mandatory standards. 10 CFR 430 subpart C appendix

A. In the NOPR stage, DOE would prepare an RIA pursuant to Executive Order (E.O.) 12866,

"Regulatory Planning and Review," 58 FR 51735 (October 4, 1993). The RIA would be subject

to review by the Office of Information and Regulatory Affairs at OMB. The RIA would address

the potential for non-regulatory approaches to supplant or augment energy conservation

standards to improve the efficiency of BCs and EPSs in the market.

DOE recognizes that voluntary or other non-regulatory efforts by manufacturers , utilities,

and other interested parties can result in substantial efficiency improvements. DOE intends to

consider the likely effects of non-regulatory initiatives on energy use, consumer utility, and LCC.

DOE will take into account the actual impacts of any such initiatives to date, but would also

consider information presented regarding the impacts that any existing initiative might have in

the future.

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EERE-2006-DET-0136 COMMENT 04.3
APPENDIX A. RELEVANT SECTIONS OF EPCA

This appendix provides a copy of the current requirements for battery chargers and

external power supplies set forth under section 135(c)(4) of EPACT 2005 that amends section

325 of EPCA to add section 325 (u), 42 U.S.C. 6295 (u). This Framework Document and

associated scoping workshop address these requirements under subsection 325(u)(1)(D) of

EPCA, 42 U.S.C 6295 (u)(l)(D).

Sec. 325 ENERGY CONSERVATION STANDARDS FOR ADDITIONAL PRODUCTS

(u) BATTERY CHARGER AND EXTERNAL POWER SUPPLY ELECTRIC ENERGY

CONSUMPTION. -

(1)(A) Not later than 18 months after the dale of enactment gf this subsection, the

Secretary shall, after providing notice and an opportunity, for comment, prescribe, by

rule, definitions and test procedures for the power use gf battery chargers and

external power supplies.

(B) In establishing the lest procedures under sub paragraph (A), the Secretary

shall-

(i) consider existing definitions and lest procedures used for measuring

energy consumption in standby mode and other modes; and

(ii) assess the current and projected future market for battery chargers and

external power supplies.

(C) The assessment under subparagraph (B)(ii) shall includeA-]

EERE-2006-DET-0136 COMMENT 04.3
i

(i) estimates of the significance of potential energy savings from technical

improvements to battery chargers and external power supplies; and

(ii) suggested produce classes for energy conservation standards.

(D) Not later than 18 months after the date of enactment of this subsection, the

Secretary shall hold a scoping workshop to discuss and receive comments on

plans far developing energy conservation standards for energy use for battery

chargers and external power supplies.

(E)(i) Not later than 3 years after the date of'enactment of'this subsection, the

Secretary shall issue a final rule that determines whether energy conservation

standards shall be issued for battery chargers and external power supplies or

classes of battery chargers and external power supplies.

(ii) For each product class, any energy conservation standards issued

under clause (i) shall be set at the lowest level of energy use thatfI) -meets the criteria and procedures of'sub' sections (o), fp), (q),

(r), (s), and (1); and

(11) would result in significant overall annual energy savings,

considering standby mode and other operating modes.

(2) In determining under section 323 whether test procedures and energy conservation

standards under this section should be revised with respect to covered products that

are major sources o/'standby mode energy consumption, the Secretary shall consider

whether to incorporate standby mode into the test procedures and energy

conservation standards, taking into account standby mode power consumption

compared to overall product energy consumption.

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EERE-2006-DET-0136 COMMENT 04.3
(3) The Secretary shall not propose an energy conservation standard under this section,

unless the Secretary has issued applicable test procedures, for each product under

section 323.

(4) Any energy conservation standard issued under this subsection shall be applicable to

products manufactured or imported beginning on the date that is 3 years after the

dale of issuance.

(5) The Secretary and the Administrator shall collaborate and develop programs

(including programs under section 324A and other voluntary industry agreements or

codes of conduct) that are designed to reduce standby mode energy use.

Sections of EPCA 325 (42 USC 6295) referenced in section l 35(u)(l)(E)(ii)(I) of

EPACT are as follows:

(o) Criteria for prescribing-new or amended standards

(1) The Secretary may not prescribe any amended standard which increases the

maximum allowable energy use, or, in the case ofshowerheads, faucets, water closets,

or urinals, water use, or decreases the minimum required energy efficiency, of a

covered product.

(2)

(A) Any new or amended energy conservation standard prescribed by the

Secretary under this section for any type (or class) of coveredproduct shall be

designed to achieve the maximum improvement in energy efficiency, or, in the

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EERE-2006-DET-0136 COMMENT 04.3
case of showerheads, faucets, water closets, or urinals, water efficiency, which

the Secretary determines is technologically feasible and economically justified.

(B)

(i) In determining whether- a standard is economically justified, the

Secretary shall, after receiving views and comments furnished with respect

to the proposed standard, determine whether the benefits ofthe standard

exceed its burdens by, to the greatest extent practicable, considering-

(1) the economic impact of the standard on the manufacturers and on the

consumers of the products subject to such standard;

(11) the savings in operating costs throughout the estimated average life

of the covered product in the type (or class) compared to any increase in

the price of or in the initial chargesfor, or maintenance expenses of the

covered products which are likely to result fi om the imposition of'the

standard;

(111) the total projected amount of energy, or as applicable, water,

savings likely to result directlyfrom the imposition of the standard;

(IV) any lessening of'the utility or the performance of the covered

products likely to result from the imposition of the standard;

(V) the impact of'any lessening of competition , as determined in writing

by the Attorney General, that is likely to resultfrom the imposition ofthe

standard;

(VI) the need for national energy and water conservation; and

(VII) other factors the Secretary considers relevant.

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EERE-2006-DET-0136 COMMENT 04.3
(ii) For purposes of clause (i)(V), the Attorney General shall make a

determination of the impact, if'any, of any lessening of competitionlikely to

result from such standard and shall transmit such determination, not later

than 60 days after the publication of a proposed rule prescribing or

amending an energy conservation standard, in writing to the Secretary,

together with an analysis of the nature and extent of'such impact. Any such

determination and analysis shall be published by the Secretary in the

Federal Register.

(iii) ifthe Secretary finds that the additional cost to the consumer of

purchasing a product complying with an energy conservation standard level

will be less than three tunes the value of the energy, and as applicable,

water; savings during the, first year that the consumer will receive as a result

of the standard, as calculated under the applicable test procedure, there

shall lrezrrebuttablepresumption that such standard level is economically

justified. A determination by the Secretary that such criterion is not met

shall not be taken into consideration in the Secretary's determination of

whether a standard is economicallyjustified.

(3) The Secretary may not prescribe an amended or new standard under this section

for a type (or class) of'covered product if=

(A) for products other than dishwashers, clothes washers, clothes dryers, and

kitchen ranges and ovens, a test procedur e has not been prescribedpursuant to

section 6293 ofthis title with respect to that type (or class) ofproduct; or

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EERE-2006-DET-0136 COMMENT 04.3
(B) the Secretary determines, by rule, that the establishment of such standard will

not result in significant conservation ofenergy or, in the case ofshoe-verheads,

faucets, water closets, or urinals, water, or that the establishment of such

standard is not technologically feasible or economically justified.

For purposes ofsection 6297 ofthis title, a determination under subparagraph (B)

with respect to any type (or class) of covered products shall have the same effect as

would a standard prescribed for such type (or class).

(4) The Secretary may not prescribe an amended or new standard under this section if

the Secretary finds (and publishes such finding) that interested persons have

established by a preponderance of the evidence that the standard is likely to result in

the unavailability in the United States in any covered product type (or class) of

performance characteristics (including reliability), features, sizes, capacities, and

volumes that are substantially the same as those generally available in the United

States at-the tinge of the Secretary's finding:--The failure of some types (or classes) to

meet this criterion shall not affect the Secretary's determination of whether- to

prescribe a standard for other types (or classes).

(5) The Secretary may set more than I energy conservation standcird. for products that

serve more than I major function by setting I energy conservation standard for each

major function.

(p) Procedure for prescribing new or amended standards

Any new or amended energy conservation standard shall be prescribed in accordance with

the following procedure:

(1) The SecretaryA-6

EERE-2006-DET-0136 COMMENT 04.3
(A) shall publish an advance notice of proposed rulemaking which specifies the

type (or class) of covered products to which the rule may apply;

(B) shall invite interested persons to submit, within 60 days after the date of

publication ofsuch advance notice, written presentations of data, views, and

arguments in response to such notice; and

(C) may ident i^; proposed or amended standards that may be prescribed.

(2) A proposed rule which prescribes an amended or new energy conservation

standard or prescribes no amendment or no new standard for- a type (or class) of

covered products shall be published in the Federal Register. In prescribing any such

proposed rule with respect to a standard, the Secretary shall determine the maximum

improvement in energy efficiency or maximum 7 reduction in energy use that is

technologically feasible for each type (or class) of covered products. If such standard

is not designed to achieve such efficiency or use, the Secretary shall state in the

proposed rule the reasons therefor [sic].

(3) A/ier the publication of such proposed rulemakhng, the Secretary shall, in

accordance with section 6306 of this title, afford interested persons an opportunity,

during a period of not less than 60 days, to present oral and written comments

(including an opportunity to question those who make such presentations, as provided

in such section) on matters relating to such proposed rule, including-

(A) ii'hether the standard to be prescribed is economically justified (taking into

account those factors which the Secretary must consider under subsection (o)(2)

of this section) or will result in the effects described in subsection ('o)(4) of this

section;

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EERE-2006-DET-0136 COMMENT 04.3
(B) whether the standard will achieve the maximum improvement in energy

efficiency which is technologically feasible;

(C) if the standard will not achieve such improvement, whether the reasons for

not achieving such improvement are adequate; and

(D) whether such rule should prescribe a level of energy use or efficiency which

is higher or lower than that which would otherwise apply in the case of any group

ofproducts within the type (or class) that will be subject to such standard.

(4) A final rule prescribing an amended or new energy conservation standard or

prescribing no amended or new standard for a type (or class) of covered products

shall be published as soon as is practicable, but not less than 90 days, after

publication of the proposed rule in the Federal Register.

(q) Special rule for certain types or classes of products

(1) A rule prescribing an energy conservation standard, for a type (or class) of covered

products shall specifj> a Ievel of energyuse orefficiency higher or lower than that

which applies (or would apply) for such type (or class) for any group of covered

products which have the same function or intended use, if the Secretary determines

that covered products within such group-

(A) consume a different kind of energy from that consumed by other covered

products within such type (or class); or

(B) have a capacity or other performance-related featrn-e which other products

within such type (or class) do not have and such feature justifies a higher or

lower standard from that which applies (or will apply) to other products within

such type (or class).

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EERE-2006-DET-0136 COMMENT 04.3
In making a determination under this paragraph concerning whether a performancerelated feature justifies the establishment (?/a higher or lower standard, the Secretary

shall consider such. factors as the utility to the consumer of'such a feature, and such

otherjhctors as the Secretary deems appropriate.

(2) Any rule prescribing a higher or lower level of energy use or efficiency under

paragraph (1) shall include an explanation of the basis on which such higher or lower

level was established.

(r) Inclusion in standards of test procedures and other requirements

Any new or amended energy conservation standard prescribed under this section shall

include, where applicable, test procedures prescribed in accordance with section 6293 of

this title and may include any requirement which the Secretary determines is necessary to

assure that each covered product to which such standard applies meets the required

minim mn level of ever y efficiency or maxinutin quantity of energy use specified in such

standard.

(s) Determination of compliance with standards

Compliance with, and performance under, the energy conservation standards (except for

design standards authorized by this part) established in, or prescribed under, this section

shall be determined using the test procedures and corresponding compliance criteria

prescribed Wunder section 6293 of this title.

(t) Small manufacturer exemption

(1) Subject to paragraph (2), the Secretary rnm-, on application of any manufacturer,

exempt such manufacturer- fr-an all or part of the requirements of any energy

conservation standard established in or prescribed under this section for any period

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EERE-2006-DET-0136 COMMENT 04.3
not longer than the 24-month period beginning on the date such rule becomes

effective, if the Secretary finds that the annual gross revenues of such manufacturer

.from all its operations (including the mcnnrf cture and sale of covered products) does

not exceed $8, 000, 000 jbr the 12-month period preceding the date of the application.

In making such.finding with respect to any manujacturer; the Secretary shall take into

account the annual gross revenues of any other person who controls, is controlled by,

or is under common control with, such manufacturer.

(2) The Secretary may not exercise the authority granted under paragraph (1) with

respect to any type (or class) of covered product subject to an energy conservation

standard under this section unless the Secretary makes a.finding, after obtaining the

written views of the Attorney General, that a.failure to allow an exemption under

paragraph (1) would likely result in a lessening of competition.

EERE-2006-DET-0136 COMMENT 04.3
APPENDIX B. DEFINITIONS OF BATTERY CHARGERS AND EXTERNAL, POWER

SUPPLIES

This appendix provides a copy of the statutory definitions for the terms "battery charger"

and "external power supply," as set forth under section 135(a)(3) of EPACT 2005 that amends

section 321 of EPCA, 42 U.S.C. 6291, to add subsections (32) and (36), which are covered under

this rulemaking. The statutory definition of the term "consumer product" is also reproduced

below for convenience.

Sec. 321(32): The term ` battery charger ' means a device that charges batteries for

consumer products, including battery chargers embedded in other consumer products. (42

U.S.C. 629] (32))

Sec. 321(36): The term `external power supply' means an external power supply circuit

that is used to convert household electric current into DC current or lower-voltage AC current to

operate a consumer product. (42 U.S.C. 6291(36))

Sec. 321(1): The term "consumer product" means any article (other than an automobile,

as defined in section 32901(a)(3) of title 49) of a type-- (A) which in operation consumes, or is

designed to consume, energy or, with respect to showerheads, faucets, water closets, and urinals,

water; and (B) which, to any significant extent, is distributed in commerce for personal use or

consumption by individuals; without regard to whether such article of such type is in fact

distributed in commerce for personal use or consumption by an individual, except that such term

B-1

EERE-2006-DET-0136 COMMENT 04.3
includes fluorescent lamp ballasts, general service fluorescent lamps, incandescent reflector

lamps, showerheads, faucets, water closets, and urinals distributed in commerce for personal or

commercial use or consumption. (42 U.S.C. 6291(1))

EERE-2006-DET-0136 COMMENT 04.3
APPENDIX C. ISSUES FOR COMMENT

While DOE invites comments on all aspects of the material presented in this document,

there are several issues in particular on which DOE seeks comment. These issues can be found

set off in comment boxes throughout the document and are listed together here. The issues

highlight certain issues and ask pertinent questions on the approaches that DOE intends to follow

in conducting the analyses applicable to the determination process, and potentially a standards

rulemaking.

Issue 1. DOE invites input on its initial assessment and analysis of the BC and EPS markets and

technology. Specific invitations for comment on DOE's initial findings and understanding of the

market can be found in "The Current and Projected Futau-e Market for Battery Chargers and

External Power Supplies." ........................................................................................................... 3-2

Issue 2. DOE invites stakeholders to recommend baseline models from each of the product

classes that would constitute good representative units for analysis . .......................................... 3-6

Issue 3. For each product class, DOE welcomes information on design options and incremental

manufacturing costs for several efficiency levels above the baseline, one of which would be max

tech. Detailed information on the product performance and the incremental manufacturing costs

(e.g., material costs, labor costs, overhead costs (excluding depreciation), building conversion

capital expenditures, tooling/equipment conversion capital expenditures, research and

development (R&D) expenses, and marketing expenses) would be welcome . ........................... 5-2

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EERE-2006-DET-0136 COMMENT 04.3
Issue 4. DOE welcomes comments on the above-described approach to determining the

relationship between manufacturer selling price and device efficiency. Stakeholders are invited

to provide data to support their comments where appropriate ..................................................... 5-4

Issue 5. DOE welcomes comments on the markup approach proposed for developing estimates

of manufacturer selling prices ...................................................................................................... 5-4

Issue 6. DOE welcomes comments as to whether there are proprietary designs that DOE should

be aware of for BCs or EPSs under consideration by this rulemaking ........................................ 5-5

Issue 7. DOE welcomes comments as to whether there are outside issues that DOE should

consider in its analysis of BCs and EPSs and the impact of such issues. Stakeholders are invited

to provide data to support their comments where appropriate ..................................................... 5-6

Issue 8. DOE welcomes recommendations on sources of data that would provide end-use

operating profiles for BCs and EPSs covered under this rulemaking .......................................... 6-1

Issue 9. DOE welcomes comments on the distribution channels for BCs and EPSs, the key

--stakelrolders-iirthase--distributirni-chami-^ls-the-typical-markuli -applied-by-tlrose-stakehulders-, -

and the overall markup from manufacturer selling price to retail shelf ....... ................................ 7-2

Issue 10. DOE welcomes input on the proposed methodology for estimating current and future

electricity prices.............................................................................Error ! Bookmark not defined.

Issue 11 . DOE welcomes input on the proposed approaches for estimating discount rates I'wconsumers of BCs and EPSs covered under this rulemaking ...................................................... 8-4

Issue 12. DOE welcomes comments on appropriate product lifetimes for BCs and EPSs........ 8-4

Issue 13. DOE welcomes comments on, and any information concerning, the four factors

described above for projecting over time annual shipments of BCs and EPSs ........................... 9-3

C-2

EERE-2006-DET-0136 COMMENT 04.3
Issue 14. DOE welcomes comments on how standards for BCs or EPSs might impact BC and

EPS shipments. DOE also invites input on the expected impacts of market-pull programs that

promote the adoption of more efficient BCs or EPSs ..................................................................9-4

Issue 15. DOE welcomes input on BC and EPS shipments forecasts. See issues 28 and 29 in the

Current and Projected Future Markets document for related invitations for comment ..............9-5

Issue 16. DOE welcomes comments on the NES spreadsheet models used for estimating

national impacts of energy conservation standards . .................................................................. 10-2

Additional issues for stakeholder review and comment can be found in the separate report

entitled "The Current and Projected Future Market for Battery Chargers and External Power

Supplies", which can be downloaded (in a PDF format) from DOE's homepage for BCs and

EPSs:

http://www.eere.energy.gov/buildings/appliance standards/residential/battery_external.html

EERE-2006-DET-0136 COMMENT 04.3