Vol. 79 Friday, 

No. 60 March 28, 2014 

Part III 

Department of Energy 

10 CFR Part 431 

Energy Conservation Program: Energy Conservation Standards for 

Commercial Refrigeration Equipment; Final Rule 


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17726 Federal Register / Vol. 79, No. 60 / Friday, March 28, 2014 / Rules and Regulations 

DEPARTMENT OF ENERGY 

10 CFR Part 431 

[Docket Number EERE–2010–BT–STD– 

0003] 

RIN 1904–AC19 

Energy Conservation Program: Energy 

Conservation Standards for 

Commercial Refrigeration Equipment 

AGENCY: Office of Energy Efficiency and 

Renewable Energy, Department of 

Energy. 

ACTION: Final rule. 

SUMMARY: The Energy Policy and 

Conservation Act of 1975 (EPCA), as 

amended, prescribes energy 

conservation standards for various 

consumer products and certain 

commercial and industrial equipment, 

including commercial refrigeration 

equipment (CRE). EPCA also requires 

the U.S. Department of Energy (DOE) to 

determine whether more-stringent 

standards would be technologically 

feasible and economically justified, and 

would save a significant amount of 

energy. In this final rule, DOE is 

adopting more-stringent energy 

conservation standards for some classes 

of commercial refrigeration equipment. 

It has determined that the amended 

energy conservation standards for these 

products would result in significant 

conservation of energy, and are 

technologically feasible and 

economically justified. 

DATES: The effective date of this rule is 

May 27, 2014. Compliance with the 

amended standards established for 

commercial refrigeration equipment in 

today’s final rule is required on March 

27, 2017. 

The incorporation by reference of 

certain publications listed in this final 

rule were approved by the Director of 

the Office of the Federal Register on 

January 9, 2009 and February 21, 2012. 

ADDRESSES: The docket, which includes 

Federal Register notices, public meeting 

attendee lists and transcripts, 

comments, and other supporting 

documents/materials, is available for 

review at www.regulations.gov. All 

documents in the docket are listed in 

the regulations.gov index. However, 

some documents listed in the index, 

such as those containing information 

that is exempt from public disclosure, 

may not be publicly available. 

A link to the docket Web page can be 

found at: http://www.regulations.gov/

#!docketDetail;D=EERE-2010-BT=STD0003. The regulations.gov Web page will 

contain simple instructions on how to 

access all documents, including public 

comments, in the docket. 

For further information on how to 

review the docket, contact Ms. Brenda 

Edwards at (202) 586–2945 or by email: 

Brenda.Edwards@ee.doe.gov. 

FOR FURTHER INFORMATION CONTACT: 

John Cymbalsky, U.S. Department of 

Energy, Office of Energy Efficiency 

and Renewable Energy, Building 

Technologies Program, EE–2J, 1000 

Independence Avenue SW., 

Washington, DC, 20585–0121. 

Telephone: (202 287–1692. Email: 

commercial_refrigeration_

equipment@EE.Doe.Gov. 

Ms. Jennifer Tiedeman, U.S. Department 

of Energy, Office of the General 

Counsel, GC–71, 1000 Independence 

Avenue SW., Washington, DC 20585– 

0121. Telephone: (202) 287–6111. 

Email: Jennifer.Tiedeman@

hq.doe.gov. 

SUPPLEMENTARY INFORMATION: 

Table of Contents 

I. Summary of the Final Rule and Its Benefits 

A. Benefits and Costs to Customers 

B. Impact on Manufacturers 

C. National Benefits and Costs 

D. Conclusion 

II. Introduction 

A. Authority 

B. Background 

1. Current Standards 

2. History of Standards Rulemaking for 

Commercial Refrigeration Equipment 

III. General Discussion 

A. Test Procedures and Normalization 

Metrics 

1. Test Procedures 

2. Normalization Metrics 

B. Technological Feasibility 

1. General 

2. Maximum Technologically Feasible 

Levels 

C. Energy Savings 

1. Determination of Savings 

2. Significance of Savings 

D. Economic Justification 

1. Specific Criteria 

a. Economic Impact on Manufacturers and 

Commercial Customers 

b. Savings in Operating Costs Compared To 

Increase in Price 

c. Energy Savings 

d. Lessening of Utility or Performance of 

Equipment 

e. Impact of Any Lessening of Competition 

f. Need of the Nation To Conserve Energy 

g. Other Factors 

2. Rebuttable Presumption 

IV. Methodology and Discussion of 

Comments 

A. General Rulemaking Issues 

1. Trial Standard Levels 

2. Proposed Standard Levels 

3. Rulemaking Timeline 

4. Normalization Metrics 

5. Conformance With Executive Orders and 

Departmental Policies 

6. Offset Factors 

B. Market and Technology Assessment 

1. Equipment Classes 

a. Equipment Subcategories 

b. Floral Equipment 

2. Technology Assessment 

a. Technologies Applicable to All 

Equipment 

b. Technologies Relevant Only to 

Equipment With Doors 

c. Technologies Applicable Only to 

Equipment Without Doors 

C. Screening Analysis 

D. Engineering Analysis 

1. Representative Equipment for Analysis 

a. Representative Unit Selection 

b. Baseline Models 

2. Design Options 

a. Fluorescent Lamp Ballasts 

b. Condenser Fans 

c. Evaporator Fans 

d. Design Options Impacting Equipment 

Form Factor 

e. Vacuum Insulated Panels (VIPs) 

f. Variable-Speed Fan Motors 

g. Improved Transparent Door Designs 

h. High-Performance Coil Designs 

i. Higher-Efficiency Fan Blades 

j. ECM Fan Motors 

k. Lighting Occupancy Sensors and 

Controls 

l. Night Curtains 

3. Refrigerants 

4. Cost Assessment Methodology 

a. Teardown Analysis 

b. Cost Model 

c. Manufacturer Production Cost 

d. Cost-Efficiency Relationship 

e. Manufacturer Markup 

f. Shipping Costs 

g. Manufacturer Interviews 

5. Energy Consumption Model 

a. Release of Engineering Model for Review 

b. Anti-Sweat Heater Power 

c. Coil Performance Modeling 

d. Compressor Performance Modeling 

e. Insulation Modeling 

f. Lighting Performance 

g. Transparent Door Performance 

h. Validation of Engineering Results 

E. Markups Analysis 

F. Life-Cycle Cost and Payback Period 

Analysis 

1. Equipment Cost 

2. Installation Costs 

3. Maintenance and Repair Costs 

4. Annual Energy Consumption 

5. Energy Prices 

6. Energy Price Projections 

7. Equipment Lifetime 

8. Discount Rates 

9. Compliance Date of Standards 

10. Base-Case Efficiency Distributions 

11. Inputs to Payback Period Analysis 

12. Rebuttable-Presumption Payback 

Period 

G. Shipments 

1. Impact of Standards on Shipments 

H. National Impact Analysis—National 

Energy Savings and Net Present Value 

1. Forecasted Efficiency in the Base Case 

and Standards Cases 

2. National Energy Savings 

3. Net Present Value of Customer Benefit 

I. Customer Subgroup Analysis 

J. Manufacturer Impact Analysis 

1. Overview 

2. Government Regulatory Impact Model 


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1For editorial reasons, upon codification in the 

U.S. Code, Part C was redesignated Part A–1. 

2All references to EPCA in this document refer 

to the statute as amended through the American 

Energy Manufacturing Technical Corrections Act 

(AEMTCA), Public Law 112–210 (Dec. 18, 2012). 

a. Government Regulatory Impact Model 

Key Inputs 

b. Government Regulatory Impact Model 

Scenarios 

3. Discussion of Comments 

a. Volume Purchasing of Components 

b. Refrigerants 

c. Redesign Issues 

d. LED Material Costs 

e. GRIM 

f. Cumulative Regulatory Burden 

g. Certification Costs 

h. Small Manufacturers 

K. Emissions Analysis 

L. Monetizing Carbon Dioxide and Other 

Emissions Impacts 

1. Social Cost of Carbon 

a. Monetizing Carbon Dioxide Emissions 

b. Social Cost of Carbon Values Used in 

Past Regulatory Analyses 

c. Current Approach and Key Assumptions 

2. Valuation of Other Emissions 

Reductions 

M. Utility Impact Analysis 

N. Employment Impact Analysis 

V. Analytical Results 

A. Trial Standard Levels 

1. Trial Standard Level Formulation 

Process and Criteria 

2. Trial Standard Level Equations 

B. Economic Justification and Energy 

Savings 

1. Economic Impacts on Commercial 

Customers 

a. Life-Cycle Cost and Payback Period 

b. Customer Subgroup Analysis 

c. Rebuttable Presumption Payback 

2. Economic Impacts on Manufacturers 

a. Industry Cash-Flow Analysis Results 

b. Impacts on Direct Employment 

c. Impacts on Manufacturing Capacity 

d. Impacts on Subgroups of Manufacturers 

e. Cumulative Regulatory Burden 

3. National Impact Analysis 

a. Energy Savings 

b. Net Present Value of Customer Costs and 

Benefits 

c. Employment Impacts 

4. Impact on Utility or Performance of 

Equipment 

5. Impact of Any Lessening of Competition 

6. Need of the Nation To Conserve Energy 

7. Summary of National Economic Impact 

8. Other Factors 

C. Conclusions 

1. Benefits and Burdens of Trial Standard 

Levels Considered for Commercial 

Refrigeration Equipment 

2. Summary of Benefits and Costs 

(Annualized) of the Standards 

VI. Procedural Issues and Regulatory Review 

A. Review Under Executive Orders 12866 

and 13563 

B. Review Under the Regulatory Flexibility 

Act 

1. Description and Estimated Number of 

Small Entities Regulated 

2. Description and Estimate of Compliance 

Requirements 

3. Duplication, Overlap, and Conflict with 

Other Rules and Regulations 

4. Significant Alternatives to the Rule 

C. Review Under the Paperwork Reduction 

Act 

D. Review Under the National 

Environmental Policy Act of 1969 

E. Review Under Executive Order 13132 

F. Review Under Executive Order 12988 

G. Review Under the Unfunded Mandates 

Reform Act of 1995 

H. Review Under the Treasury and General 

Government Appropriations Act, 1999 

I. Review Under Executive Order 12630 

J. Review Under the Treasury and General 

Government Appropriations Act, 2001 

K. Review Under Executive Order 13211 

L. Review Under the Information Quality 

Bulletin for Peer Review 

M. Congressional Notification 

VII. Approval of the Office of the Secretary 

I. Summary of the Final Rule and Its 

Benefits 

Title III, Part C1 of the Energy Policy 

and Conservation Act of 1975 (EPCA or 

the Act), Public Law 94–163 (42 U.S.C. 

6291–6309, as codified), added by 

Public Law 95–619, Title IV, section 

441(a), established the Energy 

Conservation Program for Certain 

Industrial Equipment.2 Pursuant to 

EPCA, any new or amended energy 

conservation standard that DOE 

prescribes for certain products, such as 

commercial refrigeration equipment, 

shall be designed to achieve the 

maximum improvement in energy 

efficiency that DOE determines is both 

technologically feasible and 

economically justified. (42 U.S.C. 

6295(o)(2)(A)) Furthermore, the new or 

amended standard must result in 

significant conservation of energy. (42 

U.S.C. 6295(o)(3)(B) and 6316(e)(1)) In 

accordance with these and other 

statutory provisions discussed in this 

document, DOE is adopting amended 

energy conservation standards for 

commercial refrigeration equipment. 

The amended standards, which consist 

of maximum daily energy consumption 

(MDEC) values as a function of either 

refrigerated volume or total display area 

(TDA), are shown in Table I.1. These 

amended standards apply to all 

equipment listed in Table I.1 and 

manufactured in, or imported into, the 

United States on or after March 27, 

2017. 

TABLE I.1—ENERGY CONSERVATION STANDARDS FOR COMMERCIAL REFRIGERATION EQUIPMENT

[Compliance required starting March 27, 2017] 

Equipment class* Standard level** † Equipment class* Standard level** †

VOP.RC.M ..................................... 0.64 × TDA + 4.07 VOP.RC.I ...................................... 2.79 × TDA + 8.7 

VOP.RC.L ...................................... 2.2 × TDA + 6.85 SVO.RC.L ..................................... 2.2 × TDA + 6.85 

VOP.SC.M ..................................... 1.69 × TDA + 4.71 SVO.RC.I ...................................... 2.79 × TDA + 8.7 

VCT.RC.M ...................................... 0.15 × TDA + 1.95 HZO.RC.I ...................................... 0.7 × TDA + 8.74 

VCT.RC.L ....................................... 0.49 × TDA + 2.61 VOP.SC.L ..................................... 4.25 × TDA + 11.82 

VCT.SC.M ...................................... 0.1 × V + 0.86 VOP.SC.I ...................................... 5.4 × TDA + 15.02 

VCT.SC.L ....................................... 0.29 × V + 2.95 SVO.SC.L ..................................... 4.26 × TDA + 11.51 

VCT.SC.I ........................................ 0.62 × TDA + 3.29 SVO.SC.I ...................................... 5.41 × TDA + 14.63 

VCS.SC.M ...................................... 0.05 × V + 1.36 HZO.SC.I ...................................... 2.42 × TDA + 9 

VCS.SC.L ....................................... 0.22 × V + 1.38 SOC.RC.L ..................................... 0.93 × TDA + 0.22 

VCS.SC.I ........................................ 0.34 × V + 0.88 SOC.RC.I ...................................... 1.09 × TDA + 0.26 

SVO.RC.M ..................................... 0.66 × TDA + 3.18 SOC.SC.I ...................................... 1.53 × TDA + 0.36 

SVO.SC.M ..................................... 1.7 × TDA + 4.59 VCT.RC.I ...................................... 0.58 × TDA + 3.05 

SOC.RC.M ..................................... 0.44 × TDA + 0.11 HCT.RC.M .................................... 0.16 × TDA + 0.13 

SOC.SC.M ..................................... 0.52 × TDA + 1 HCT.RC.L ..................................... 0.34 × TDA + 0.26 

HZO.RC.M ..................................... 0.35 × TDA + 2.88 HCT.RC.I ...................................... 0.4 × TDA + 0.31 

HZO.RC.L ...................................... 0.55 × TDA + 6.88 VCS.RC.M .................................... 0.1 × V + 0.26 

HZO.SC.M ..................................... 0.72 × TDA + 5.55 VCS.RC.L ..................................... 0.21 × V + 0.54 

HZO.SC.L ...................................... 1.9 × TDA + 7.08 VCS.RC.I ...................................... 0.25 × V + 0.63 

HCT.SC.M ...................................... 0.06 × V + 0.37 HCS.SC.I ...................................... 0.34 × V + 0.88 

HCT.SC.L ....................................... 0.08 × V + 1.23 HCS.RC.M .................................... 0.1 × V + 0.26 

HCT.SC.I ........................................ 0.56 × TDA + 0.43 HCS.RC.L ..................................... 0.21 × V + 0.54 


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3Life-cycle cost of commercial refrigeration 

equipment is the cost to customers of owning and 

operating the equipment over the entire life of the 

equipment. Life-cycle cost savings are the 

reductions in the life-cycle costs due to amended 

energy conservation standards when compared to 

the life-cycle costs of the equipment in the absence 

of amended energy conservation standards. 

4Payback period refers to the amount of time (in 

years) it takes customers to recover the increased 

installed cost of equipment associated with new or 

amended standards through savings in operating 

cost. Further discussion can be found in chapter 8 

of the final rule TSD. 

5All monetary values in this notice are expressed 

in 2012 dollars. 

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

Information Administration, Annual Energy 

Outlook 2013 (AEO 2013) data. 

7All present value results reflect discounted to 

beginning of 2014. 

8A metric ton is equivalent to 1.1 short tons. 

Results for NOX and Hg are presented in short tons. 

TABLE I.1—ENERGY CONSERVATION STANDARDS FOR COMMERCIAL REFRIGERATION EQUIPMENT—Continued 

[Compliance required starting March 27, 2017] 

Equipment class* Standard level** † Equipment class* Standard level** †

HCS.SC.M ..................................... 0.05 × V + 0.91 HCS.RC.I ...................................... 0.25 × V + 0.63 

HCS.SC.L ...................................... 0.06 × V + 1.12 SOC.SC.L ..................................... 1.1 × TDA + 2.1 

PD.SC.M ........................................ 0.11 × V + 0.81 ..................................................

* Equipment class designations consist of a combination (in sequential order separated by periods) of: (1) An equipment family code (VOP = 

vertical open, SVO = semivertical open, HZO = horizontal open, VCT = vertical closed with transparent doors, VCS = vertical closed with solid 

doors, HCT = horizontal closed with transparent doors, HCS = horizontal closed with solid doors, SOC = service over counter, or PD = pulldown); (2) an operating mode code (RC = remote condensing or SC = self-contained); and (3) a rating temperature code (M = medium temperature (38±2 °F), L = low temperature (0±2 °F), or I = ice-cream temperature (¥15±2 °F)). For example, ‘‘VOP.RC.M’’ refers to the ‘‘vertical open, 

remote condensing, medium temperature’’ equipment class. See discussion in chapter 3 of the final rule technical support document (TSD) for a 

more detailed explanation of the equipment class terminology. 

** ‘‘TDA’’ is the total display area of the case, as measured in the Air-Conditioning, Heating, and Refrigeration Institute (AHRI) Standard 1200– 

2010, appendix D. † ‘‘V’’ is the volume of the case, as measured in American National Standards Institute (ANSI)/Association of Home Appliance Manufacturers 

(AHAM) Standard HRF–1–2004. 

A. Benefits and Costs to Customers 

Table I.2 presents DOE’s evaluation of 

the economic impacts of today’s 

standards on customers of commercial 

refrigeration equipment, as measured by 

the average life-cycle cost (LCC) 

savings 3 and the median payback 

period (PBP).4 The average LCC savings 

are positive for all equipment classes for 

which customers are impacted by the 

amended standards. 

TABLE I.2—IMPACTS OF TODAY’S

STANDARDS ON CUSTOMERS OF

COMMERCIAL REFRIGERATION

EQUIPMENT

Equipment 

class* 

Average 

LCC savings 

2012$ 

Median PBP 

years 

VOP.RC.M ........ 922 5.7 

VOP.RC.L ......... 53 6.1 

VOP.SC.M ........ .................... ....................

VCT.RC.M ........ 542 2.1 

VCT.RC.L ......... 526 2.7 

VCT.SC.M ......... 226 5.3 

VCT.SC.L .......... 5001 1.1 

VCT.SC.I ........... 18 7.2 

VCS.SC.M ........ 363 1.4 

VCS.SC.L ......... 507 2.5 

VCS.SC.I .......... 113 5.0 

SVO.RC.M ........ 564 6.2 

SVO.SC.M ........ .................... ....................

SOC.RC.M ........ .................... ....................

SOC.SC.M ........ .................... ....................

HZO.RC.M ........ .................... ....................

HZO.RC.L ......... .................... ....................

TABLE I.2—IMPACTS OF TODAY’S

STANDARDS ON CUSTOMERS OF

COMMERCIAL REFRIGERATION

EQUIPMENT—Continued 

Equipment 

class* 

Average 

LCC savings 

2012$ 

Median PBP 

years 

HZO.SC.M ........ 55 6.9 

HZO.SC.L ......... .................... ....................

HCT.SC.M ........ 101 5.8 

HCT.SC.L ......... 293 2.5 

HCT.SC.I .......... .................... ....................

HCS.SC.M ........ 15 5.5 

HCS.SC.L ......... 64 2.5 

PD.SC.M ........... 165 5.6 

* Values have been shown only for primary 

equipment classes, which are equipment 

classes that have significant volume of shipments and, therefore, were directly analyzed. 

See chapter 5 of the final rule TSD, Engineering Analysis, for a detailed discussion of primary and secondary equipment classes. 

* For equipment classes VOP.SC.M, 

SVO.SC.M, SOC. RC.M, SOC. SC.M, 

HZO.RC.M, HZO.RC.L, HZO.SC.L, and 

HCT.SC.I, no efficiency levels above the baseline were found to be economically justifiable. 

Therefore, the standard levels contained in today’s document for these equipment classes 

are the same as those set in the 2009 final 

rule. As a result, LCC savings and PBP values 

for these equipment classes are not relevant. 

Note: Equipment lifetimes are between 10 

and 15 years for all equipment classes. 

B. Impact on Manufacturers 

The industry net present value (INPV) 

is the sum of the discounted cash flows 

to the industry from the base year (2013) 

through the end of the analysis period 

(2046). Using a real discount rate of 10.0 

percent, DOE estimates that the INPV 

for manufacturers of commercial 

refrigeration equipment is $2,660.0 

million in 2012$.5 Under today’s 

standards, DOE expects the industry net 

present value to decrease by 3.53 

percent to 6.60 percent. Total industry 

conversion costs are expected to total 

$184.0 million. Additionally, based on 

DOE’s interviews with the 

manufacturers of commercial 

refrigeration equipment, DOE does not 

expect significant loss of domestic 

employment. 

C. National Benefits and Costs 

DOE’s analyses indicate that today’s 

standards would save a significant 

amount of energy. The lifetime savings 

for commercial refrigeration equipment 

purchased in the 30-year period that 

begins in the year of compliance with 

amended standards (2017–2046) amount 

to 2.89 quadrillion British thermal units 

(quads). The annualized energy savings 

(0.10 quads) are equivalent to 0.5 

percent of total U.S. commercial 

primary energy consumption in 2014.6

The cumulative net present value 

(NPV) of total consumer costs and 

savings of today’s standards for 

commercial refrigeration equipment 

ranges from $4.93 billion (at a 7-percent 

discount rate) to $11.74 billion (at a 3- 

percent discount rate).7 This NPV 

expresses the estimated total value of 

future operating cost savings minus the 

estimated increased product costs for 

products purchased in 2016–2047. 

In addition, today’s standards are 

expected to have significant 

environmental benefits. The energy 

savings would result in cumulative 

emission reductions of approximately 

142 million metric tons (Mt) 8 of carbon 

dioxide (CO2), 762 thousand tons of 

methane, 207 thousand tons of sulfur 

dioxide (SO2), 94 tons of nitrogen oxides 


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Federal Register / Vol. 79, No. 60 / Friday, March 28, 2014 / Rules and Regulations 17729 

9 DOE calculated emissions reductions relative to 

the AEO 2013 Reference case, which generally 

represents current legislation and environmental 

regulations for which implementing regulations 

were available as of December 31, 2012. 

10Technical Update of the Social Cost of Carbon 

for Regulatory Impact Analysis Under Executive 

Order 12866. Interagency Working Group on Social 

Cost of Carbon, United States Government. May 

2013; revised November 2013. http://

www.whitehouse.gov/sites/default/files/omb/assets/

inforeg/technical-update-social-cost-of-carbon-forregulator-impact-analysis.pdf. 

11 DOE is investigating the valuation of avoided 

Hg and SO2 emissions. 

12 DOE used a two-step calculation process to 

convert the time-series of costs and benefits into 

annualized values. First, DOE calculated a present 

value in 2013, the year used for discounting the 

NPV of total customer costs and savings, for the 

time-series of costs and benefits, using discount 

rates of three and seven percent for all costs and 

benefits except for the value of CO2 reductions. For 

the latter, DOE used a range of discount rates, as 

shown in Table I.3. From the present value, DOE 

then calculated the fixed annual payment over a 30- 

year period (2017 through 2046) that yields the 

same present value. The fixed annual payment is 

the annualized value. Although DOE calculated 

annualized values, this does not imply that the 

time-series of cost and benefits from which the 

annualized values were determined is a steady 

stream of payments. 

(NOX) and 0.25 tons of mercury (Hg).9

Through 2030, the estimated energy 

savings would result in cumulative 

emissions reductions of 48 Mt of CO2.

The value of the CO2 reductions is 

calculated using a range of values per 

metric ton of CO2 (otherwise known as 

the Social Cost of Carbon, or SCC) 

developed by a recent Federal 

interagency process.10 The derivation of 

the SCC values is discussed in section 

IV.M. Using discount rates appropriate 

for each set of SCC values, DOE 

estimates that the net present monetary 

value of the CO2 emissions reductions is 

between $1.0 billion and $14.0 billion. 

DOE also estimates that the net present 

monetary value of the NOX emissions 

reductions is $33 million at a 7-percent 

discount rate, and $104 million at a 3- 

percent discount rate.11

Table I.3 summarizes the national 

economic costs and benefits expected to 

result from today’s standards for 

commercial refrigeration equipment. 

TABLE I.3—SUMMARY OF NATIONAL ECONOMIC BENEFITS AND COSTS OF AMENDED COMMERCIAL REFRIGERATION

EQUIPMENT ENERGY CONSERVATION STANDARDS* 

Category 

Present value 

Billion 

2012$ 

Discount rate 

(percent) 

Benefits 

Operating Cost Savings ................................................................................................................................... 7.70 

16.63 

7 

3 

CO2 Reduction Monetized Value ($11.8/t case)** .......................................................................................... 1.01 5 

CO2 Reduction Monetized Value ($39.7/t case)** .......................................................................................... 4.55 3 

CO2 Reduction Monetized Value ($61.2/t case)** .......................................................................................... 7.20 2.5 

CO2 Reduction Monetized Value ($117/t case)** ........................................................................................... 14.05 3 

NOX Reduction Monetized Value (at $2,591/ton )** ....................................................................................... 0.03 7 

0.10 3 

Total Benefits† .......................................................................................................................................... 12.28 7 

21.28 3 

Costs 

Incremental Installed Costs ............................................................................................................................. 2.77 7 

4.89 3 

Net Benefits 

Including CO2 and NOX † Reduction Monetized Value .................................................................................. 9.51 

16.40 

7 

3 

* This table presents the costs and benefits associated with commercial refrigeration equipment shipped in 2017–2046. These results include 

benefits to customers which accrue after 2046 from the equipment purchased in 2017–2046. The results account for the incremental variable and 

fixed costs incurred by manufacturers due to the amended standard, some of which may be incurred in preparation for this final rule. 

** The CO2 values represent global monetized values of the SCC, in 2012$, in 2015 under several scenarios of the updated SCC values. The 

first three cases use the averages of SCC distributions calculated using 5%, 3%, and 2.5% discount rates, respectively. The fourth case represents the 95th percentile of the SCC distribution calculated using a 3% discount rate. The SCC time series used by DOE incorporates an escalation factor. The value for NOX is the average of the low and high values used in DOE’s analysis. 

† Total Benefits for both the 3% and 7% cases are derived using the series corresponding to average SCC with 3-percent discount rate. 

The benefits and costs of today’s 

standards, for equipment sold in 2017– 

2046, can also be expressed in terms of 

annualized values. The annualized 

monetary values are the sum of (1) the 

annualized national economic value of 

the benefits from operating the product 

(consisting primarily of operating cost 

savings from using less energy, minus 

increases in equipment purchase and 

installation costs, which is another way 

of representing consumer NPV, plus (2) 

the annualized monetary value of the 

benefits of emission reductions, 

including CO2 emission reductions.12

Although adding the value of 

consumer savings to the values of 

emission reductions provides a valuable 

perspective, two issues should be 

considered. First, the national operating 

cost savings are domestic U.S. consumer 

monetary savings that occur as a result 

of market transactions, while the value 

of CO2 reductions is based on a global 

value. Second, the assessments of 

operating cost savings and CO2 savings 

are performed with different methods 

that use different time frames for 

analysis. The national operating cost 

savings is measured for the lifetime of 

commercial refrigeration equipment 

shipped in 2017–2046. The SCC values, 

on the other hand, reflect the present 

value of all future climate-related 

impacts resulting from the emission of 

one metric ton of carbon dioxide in each 


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year. These impacts continue well 

beyond 2100. 

Estimates of annualized benefits and 

costs of today’s standards are shown in 

Table I.4. The results under the primary 

estimate are as follows. Using a 7- 

percent discount rate for benefits and 

costs other than CO2 reduction, for 

which DOE used a 3-percent discount 

rate along with the average SCC series 

that uses a 3-percent discount rate, the 

cost of the amended standards in 

today’s rule is $256 million per year in 

increased equipment costs, while the 

benefits are $710 million per year in 

reduced equipment operating costs, 

$246 million in CO2 reductions, and 

$3.01 million in reduced NOX

emissions. In this case, the net benefit 

amounts to $704 million per year. Using 

a 3-percent discount rate for all benefits 

and costs and the average SCC series, 

the cost of the standards in today’s rule 

is $264 million per year in increased 

equipment costs, while the benefits are 

$900 million per year in reduced 

operating costs, $246 million in CO2

reductions, and $5.64 million in 

reduced NOX emissions. In this case, the 

net benefit amounts to $888 million per 

year. 

TABLE I.4—ANNUALIZED BENEFITS AND COSTS OF AMENDED STANDARDS FOR COMMERCIAL REFRIGERATION EQUIPMENT* 

Discount rate 

million 2012$/year 

Primary estimate* Low net benefits estimate* High net benefits estimate* 

Benefits 

Operating Cost Savings .... 7% ..................................... 710 .................................... 688 .................................... 744. 

3% ..................................... 900 .................................... 865 .................................... 947. 

CO2 Reduction at ($11.8/t 

case)**.

5% ..................................... 73 ...................................... 73 ...................................... 73. 

CO2 Reduction at ($39.7/t 

case)**.

3% ..................................... 246 .................................... 246 .................................... 246. 

CO2 Reduction at ($61.2/t 

case)**.

2.5% .................................. 361 .................................... 361 .................................... 361. 

CO2 Reduction at ($117.0/t 

case)**.

3% ..................................... 760 .................................... 760 .................................... 760. 

NOX Reduction at ($2,591/

ton)**.

7% ..................................... 3.01 ................................... 3.01 ................................... 3.01. 

3% ..................................... 5.64 ................................... 5.64 ................................... 5.64. 

Total Benefits† ........... 7% plus CO2 range ........... 786 to 1,474 ...................... 764 to 1,451 ...................... 820 to 1,508. 

7% ..................................... 960 .................................... 937 .................................... 994. 

3% plus CO2 range ........... 978 to 1,666 ...................... 943 to 1,631 ...................... 1,026 to 1,713. 

3% ..................................... 1,152 ................................. 1,117 ................................. 1,200. 

Costs 

Incremental Equipment 

Costs.

7% ..................................... 256 .................................... 250 .................................... 261. 

3% ..................................... 264 .................................... 258 .................................... 271. 

Net Benefits 

Total† ......................... 7% plus CO2 range ........... 530 to 1,218 ...................... 513 to 1,201 ...................... 559 to 1,246. 

7% ..................................... 704 .................................... 687 .................................... 733. 

3% plus CO2 range ........... 714 to 1,402 ...................... 685 to 1,373 ...................... 755 to 1,442. 

3% ..................................... 888 .................................... 859 .................................... 929. 

* This table presents the annualized costs and benefits associated with commercial refrigeration equipment shipped in 2017–2046. These results include benefits to customers which accrue after 2046 from the products purchased in 2017–2046. The results account for the incremental 

variable and fixed costs incurred by manufacturers due to the amended standard, some of which may be incurred in preparation for the final rule. 

The primary, low, and high estimates utilize projections of energy prices from the AEO 2013 Reference case, Low Estimate, and High Estimate, 

respectively. In addition, incremental equipment costs reflect a medium decline rate for projected product price trends in the Primary Estimate, a 

low decline rate for projected product price trends in the Low Benefits Estimate, and a high decline rate for projected product price trends in the 

High Benefits Estimate. The method used to derive projected price trends are explained in section IV.H. 

** The CO2 values represent global monetized values of the SCC, in 2012$, in 2015 under several scenarios of the updated SCC values. The 

first three cases use the averages of SCC distributions calculated using 5%, 3%, and 2.5% discount rates, respectively. The fourth case represents the 95th percentile of the SCC distribution calculated using a 3% discount rate. The SCC time series used by DOE incorporate an escalation factor. The value for NOX is the average of the low and high values used in DOE’s analysis. 

† Total Benefits for both the 3-percent and 7-percent cases are derived using the series corresponding to average SCC with 3-percent discount 

rate. In the rows labeled ‘‘7% plus CO2 range’’ and ‘‘3% plus CO2 range,’’ the operating cost and NOX benefits are calculated using the labeled 

discount rate, and those values are added to the full range of CO2 values. 

D. Conclusion 

Based on the analyses culminating in 

this final rule, DOE found the benefits 

to the nation of the amended standards 

(energy savings, consumer LCC savings, 

positive NPV of consumer benefit, and 

emission reductions) outweigh the 

burdens (loss of INPV and LCC 

increases for some users of this 

equipment). DOE has concluded that the 

standards in today’s final rule represent 

the maximum improvement in energy 

efficiency that is both technologically 

feasible and economically justified, and 

would result in significant conservation 

of energy. (42 U.S.C. 6295(o), 6316(e)) 

II. Introduction 

The following section briefly 

discusses the statutory authority 

underlying today’s final rule, as well as 

some of the relevant historical 

background related to the establishment 

of amended standards for commercial 

refrigeration equipment. 


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Federal Register / Vol. 79, No. 60 / Friday, March 28, 2014 / Rules and Regulations 17731 

13For editorial reasons, upon codification in the 

U.S. Code, Part C was re-designated Part A–1. 

14All references to EPCA in this document refer 

to the statute as amended through the American 

Energy Manufacturing Technical Corrections Act 

(AEMTCA), Public Law 112–210 (Dec. 18, 2012). 

A. Authority 

Title III, Part C of EPCA, Public Law 

94–163 (42 U.S.C. 6311–6317, as 

codified), added by Public Law 95–619, 

Title IV, section 441(a), established the 

Energy Conservation Program for 

Certain Industrial Equipment, a program 

covering certain industrial equipment, 

which includes the commercial 

refrigeration equipment that is the focus 

of this document.13 14 EPCA prescribes 

energy conservation standards for 

commercial refrigeration equipment (42 

U.S.C. 6313(c)(2)–(4)), and directs DOE 

to conduct rulemakings to establish new 

and amended standards for commercial 

refrigeration equipment. (42 U.S.C. 

6313(c)(4)–(6)) (DOE notes that under 42 

U.S.C. 6295(m) and 6316(e)(1) the 

agency must periodically review its 

already established energy conservation 

standards for covered equipment. Under 

this requirement, the next review that 

DOE would need to conduct must occur 

no later than 6 years from the issuance 

of a final rule establishing or amending 

a standard for covered equipment.) 

Pursuant to EPCA, DOE’s energy 

conservation program for covered 

equipment generally consists of four 

parts: (1) Testing; (2) labeling; (3) the 

establishment of Federal energy 

conservation standards; and (4) 

certification and enforcement 

procedures. For commercial 

refrigeration equipment, DOE is 

responsible for the entirety of this 

program. Subject to certain criteria and 

conditions, DOE is required to develop 

test procedures to measure the energy 

efficiency, energy use, or estimated 

annual operating cost of each type or 

class of covered equipment. (42 U.S.C. 

6314) Manufacturers of covered 

equipment must use the prescribed DOE 

test procedure as the basis for certifying 

to DOE that their equipment complies 

with the applicable energy conservation 

standards adopted under EPCA and 

when making representations to the 

public regarding the energy use or 

efficiency of that equipment. (42 U.S.C. 

6315(b), 6295(s), and 6316(e)(1)) 

Similarly, DOE must use these test 

procedures to determine whether that 

equipment complies with standards 

adopted pursuant to EPCA. The DOE 

test procedure for commercial 

refrigeration equipment currently 

appears at title 10 of the Code of Federal 

Regulations (CFR) part 431, subpart C. 

DOE must follow specific statutory 

criteria for prescribing amended 

standards for covered equipment. As 

indicated above, any amended standard 

for covered equipment must be designed 

to achieve the maximum improvement 

in energy efficiency that is 

technologically feasible and 

economically justified. (42 U.S.C. 

6295(o)(2)(A) and 6316(e)(1)) 

Furthermore, DOE may not adopt any 

standard that would not result in the 

significant conservation of energy. (42 

U.S.C. 6295(o)(3) and 6316(e)(1)) DOE 

also may not prescribe a standard: (1) 

For certain equipment, including 

commercial refrigeration equipment, if 

no test procedure has been established 

for the product; or (2) if DOE determines 

by rule that the proposed standard is not 

technologically feasible or economically 

justified. (42 U.S.C. 6295(o)(3)(A)–(B) 

and 6316(e)(1)) In deciding whether a 

proposed standard is economically 

justified, DOE must determine whether 

the benefits of the standard exceed its 

burdens. (42 U.S.C. 6295(o)(2)(B)(i) and 

6316(e)(1)) DOE must make this 

determination after receiving comments 

on the proposed standard, and by 

considering, to the greatest extent 

practicable, the following seven factors: 

1. The economic impact of the 

standard on manufacturers and 

consumers of the equipment subject to 

the standard; 

2. The savings in operating costs 

throughout the estimated average life of 

the covered equipment in the type (or 

class) compared to any increase in the 

price, initial charges, or maintenance 

expenses for the covered equipment that 

are likely to result from the imposition 

of the standard; 

3. The total projected amount of 

energy, or as applicable, water, savings 

likely to result directly from the 

imposition of the standard; 

4. Any lessening of the utility or the 

performance of the covered equipment 

likely to result from the imposition of 

the standard; 

5. The impact of any lessening of 

competition, as determined in writing 

by the U.S. Attorney General (Attorney 

General), that is likely to result from the 

imposition of the standard; 

6. The need for national energy and 

water conservation; and 

7. Other factors the Secretary 

considers relevant. 

(42 U.S.C. 6295(o)(2)(B)(i)(I)–(VII) and 

6316(e)(1)) 

EPCA, as codified, also contains what 

is known as an ‘‘anti-backsliding’’ 

provision, which prevents the Secretary 

from prescribing any amended standard 

that either increases the maximum 

allowable energy use or decreases the 

minimum required energy efficiency of 

covered equipment. (42 U.S.C. 

6295(o)(1) and 6316(e)(1)) Also, the 

Secretary may not prescribe an amended 

or new standard if interested persons 

have established by a preponderance of 

the evidence that the standard is likely 

to result in the unavailability in the 

United States of 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. 

(42 U.S.C. 6295(o)(4) and 6316(e)(1)) 

Further, EPCA, as codified, 

establishes a rebuttable presumption 

that a standard is economically justified 

if the 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 times the value of the energy 

savings during the first year that the 

consumer will receive as a result of the 

standard, as calculated under the 

applicable test procedure. (See 42 U.S.C. 

6295(o)(2)(B)(iii) and 6316(e)(1)) Section 

III.D.2 presents additional discussion 

about the rebuttable presumption 

payback period. 

Additionally, 42 U.S.C. 6295(q)(1) and 

6316(e)(1) specify requirements when 

promulgating a standard for a type or 

class of covered equipment that has two 

or more subcategories that may justify 

different standard levels. DOE must 

specify a different standard level than 

that which applies generally to such 

type or class of equipment for any group 

of covered products that has the same 

function or intended use if DOE 

determines that products within such 

group (A) consume a different kind of 

energy from that consumed by other 

covered equipment within such type (or 

class); or (B) have a capacity or other 

performance-related feature that other 

equipment within such type (or class) 

do not have and such feature justifies a 

higher or lower standard. (42 U.S.C. 

6295(q)(1) and 6316(e)(1)) In 

determining whether a performancerelated feature justifies a different 

standard for a group of equipment, DOE 

must consider such factors as the utility 

to the consumer of the feature and other 

factors DOE deems appropriate. Id. Any 

rule prescribing such a standard must 

include an explanation of the basis on 

which such higher or lower level was 

established. (42 U.S.C. 6295(q)(2) and 

6316(e)(1)) 

Federal energy conservation 

requirements generally supersede State 

laws or regulations concerning energy 

conservation testing, labeling, and 


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17732 Federal Register / Vol. 79, No. 60 / Friday, March 28, 2014 / Rules and Regulations 

standards. (42 U.S.C. 6297(a)–(c) and 

6316(e)) 

B. Background 

1. Current Standards 

The current energy conservation 

standards for commercial refrigeration 

equipment were established by two 

different legislative actions and one 

DOE final rule. EPCA, as amended by 

the Energy Policy Act of 2005 (EPACT 

2005), established standards for selfcontained commercial refrigerators and 

freezer with solid or transparent doors, 

self-contained commercial refrigeratorfreezers with solid doors, and selfcontained commercial refrigerators 

designed for pull-down applications. 

(42 U.S.C. 6313(c)(2)–(3)) On January 9, 

2009, DOE published a final rule 

(January 2009 final rule) prescribing 

standards for commercial refrigeration 

equipment. 74 FR at 1092. Specifically, 

this final rule completed the first 

standards rulemaking for commercial 

refrigeration equipment by establishing 

standards for equipment types specified 

in 42 U.S.C. 6313(c)(5), and for which 

EPCA did not prescribe standards in 42 

U.S.C. 6313(c)(2)–(3). These types 

consisted of commercial ice-cream 

freezers; self-contained commercial 

refrigerators, commercial freezers, and 

commercial refrigerator-freezers without 

doors; and remote condensing 

commercial refrigerators, commercial 

freezers, and commercial refrigeratorfreezers. More recently, the American 

Energy Manufacturing Technical 

Corrections Act (AEMTCA), Public Law 

112–210 (December 18, 2012), amended 

section 342(c) of EPCA to establish a 

new standard for self-contained service 

over counter medium temperature 

commercial refrigerators (this class is 

known as SOC.SC.M per DOE’s 

equipment class nomenclature). (42 

U.S.C. 6313(c)(4)) As a result, DOE’s 

current energy conservation standards 

for commercial refrigeration equipment 

include the following: Standards 

established by EPCA for commercial 

refrigeration equipment manufactured 

on or after January 1, 2010; standards 

established in the January 2009 final 

rule for commercial refrigeration 

equipment manufactured on or after 

January 1, 2012; and standards 

established by AEMTCA for SOC.SC.M 

equipment manufactured on or after 

January 1, 2012. 

Table II.1 and Table II.2 present 

DOE’s current energy conservation 

standards for commercial refrigeration 

equipment set by EPCA and the January 

2009 final rule, respectively. The 

AEMTCA standard for SOC.SC.M 

equipment manufactured on or after 

January 1, 2012 is prescribed as 0.6 × 

TDA + 1.0. (42 U.S.C. 6313(c)(4)) 

TABLE II.1—COMMERCIAL REFRIGERATION EQUIPMENT STANDARDS PRESCRIBED BY EPCA—COMPLIANCE REQUIRED

BEGINNING ON JANUARY 1, 2010 

Category Maximum daily energy consumption 

kWh/day* 

Refrigerators with solid doors .............................................................................................................. 0.10 V** + 2.04. 

Refrigerators with transparent doors ................................................................................................... 0.12 V + 3.34. 

Freezers with solid doors .................................................................................................................... 0.40 V + 1.38. 

Freezers with transparent doors .......................................................................................................... 0.75 V + 4.10. 

Refrigerators/freezers with solid doors ................................................................................................ the greater of 0.27 AV†—0.71 or 0.70. 

Self-contained refrigerators with transparent doors designed for pull-down temperature applications.0.126V + 3.51. 

* kilowatt-hours per day. 

** Where ‘‘V’’ means the chilled or frozen compartment volume in cubic feet as defined in the Association of Home Appliance Manufacturers 

Standard HRF–1–1979. 10 CFR 431.66. 

† Where ‘‘AV’’ means that adjusted volume in cubic feet measured in accordance with the Association of Home Appliance Manufacturers 

Standard HRF–1–1979. 10 CFR 431.66. 

TABLE II.2—COMMERCIAL REFRIGERATION EQUIPMENT STANDARDS ESTABLISHED IN THE JANUARY 2009 

FINAL RULE—COMPLIANCE REQUIRED BEGINNING ON JANUARY 1, 

2012 

Equipment class * Standard level ** 

kWh/day 

VOP.RC.M ................ 0.82 × TDA + 4.07 

SVO.RC.M ................ 0.83 × TDA + 3.18 

HZO.RC.M ................ 0.35 × TDA + 2.88 

VOP.RC.L ................. 2.27 × TDA + 6.85 

HZO.RC.L ................. 0.57 × TDA + 6.88 

VCT.RC.M ................. 0.22 × TDA + 1.95 

VCT.RC.L .................. 0.56 × TDA + 2.61 

SOC.RC.M ................ 0.51 × TDA + 0.11 

VOP.SC.M ................. 1.74 × TDA + 4.71 

SVO.SC.M ................. 1.73 × TDA + 4.59 

HZO.SC.M ................. 0.77 × TDA + 5.55 

HZO.SC.L .................. 1.92 × TDA + 7.08 

VCT.SC.I ................... 0.67 × TDA + 3.29 

VCS.SC.I ................... 0.38 × V + 0.88 

HCT.SC.I ................... 0.56 × TDA + 0.43 

SVO.RC.L ................. 2.27 × TDA + 6.85 

VOP.RC.I .................. 2.89 × TDA + 8.7 

SVO.RC.I .................. 2.89 × TDA + 8.7 

TABLE II.2—COMMERCIAL REFRIGERATION EQUIPMENT STANDARDS ESTABLISHED IN THE JANUARY 2009 

FINAL RULE—COMPLIANCE REQUIRED BEGINNING ON JANUARY 1, 

2012—Continued 

Equipment class * Standard level ** 

kWh/day 

HZO.RC.I .................. 0.72 × TDA + 8.74 

VCT.RC.I ................... 0.66 × TDA + 3.05 

HCT.RC.M ................. 0.16 × TDA + 0.13 

HCT.RC.L .................. 0.34 × TDA + 0.26 

HCT.RC.I ................... 0.4 × TDA + 0.31 

VCS.RC.M ................. 0.11 × V + 0.26 

VCS.RC.L .................. 0.23 × V + 0.54 

VCS.RC.I ................... 0.27 × V + 0.63 

HCS.RC.M ................ 0.11 × V + 0.26 

HCS.RC.L ................. 0.23 × V + 0.54 

HCS.RC.I .................. 0.27 × V + 0.63 

SOC.RC.L ................. 1.08 × TDA + 0.22 

SOC.RC.I .................. 1.26 × TDA + 0.26 

VOP.SC.L .................. 4.37 × TDA + 11.82 

VOP.SC.I ................... 5.55 × TDA + 15.02 

SVO.SC.L .................. 4.34 × TDA + 11.51 

SVO.SC.I ................... 5.52 × TDA + 14.63 

HZO.SC.I ................... 2.44 × TDA + 9. 

TABLE II.2—COMMERCIAL REFRIGERATION EQUIPMENT STANDARDS ESTABLISHED IN THE JANUARY 2009 

FINAL RULE—COMPLIANCE REQUIRED BEGINNING ON JANUARY 1, 

2012—Continued 

Equipment class * Standard level ** 

kWh/day 

SOC.SC.I .................. 1.76 × TDA + 0.36 

HCS.SC.I ................... 0.38 × V + 0.88 

* Equipment class designations consist of a 

combination (in sequential order separated by 

periods) of: (1) An equipment family code 

(VOP = vertical open, SVO = semivertical 

open, HZO = horizontal open, VCT = vertical 

closed with transparent doors, VCS = vertical 

closed with solid doors, HCT = horizontal 

closed with transparent doors, HCS = horizontal closed with solid doors, or SOC = service over counter); (2) an operating mode code 

(RC = remote condensing or SC = self-contained); and (3) a rating temperature code (M 

= medium temperature (38 °F), L = low temperature (0 °F), or I = ice-cream temperature 

(¥15 °F)). For example, ‘‘VOP.RC.M’’ refers 

to the ‘‘vertical open, remote condensing, medium temperature’’ equipment class. 


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15EPCA defines the term ‘‘holding temperature 

application’’ as a use of commercial refrigeration 

equipment other than a pull-down temperature 

application, except a blast chiller or freezer. (42 

U.S.C. 6311(9)(B)) 

16EPCA defines the term ‘‘pull-down temperature 

application’’ as a commercial refrigerator with 

doors that, when fully loaded with 12 ounce 

beverage cans at 90 °F, can cool those beverages to 

an average stable temperature of 38 °F in 12 hours 

or less. (42 U.S.C. 6311(9)(D)) 

17Baseline units consist of units possessing 

features and levels of efficiency consistent with the 

least-efficient equipment currently available and 

widely sold on the market. 

** TDA is the total display area of the case, 

as measured in ANSI/Air-Conditioning and Refrigeration Institute (ARI) Standard 1200–2006, 

appendix D. V is the volume of the case, as 

measured in AHAM Standard HRF–1–2004. 

In December 2012, AEMTCA 

amended EPCA by establishing new 

standards for SOC.SC.M equipment 

with a compliance date of January 1, 

2012. (42 U.S.C. 6313(c)(4)) The 

SOC.SC.M equipment had previously 

been classified under the category selfcontained commercial refrigerators with 

transparent doors, for which standards 

were established by EPACT 2005. (42 

U.S.C. 6313(c)(2)) The standard 

established by AEMTCA for SOC.SC.M 

equipment reduces the stringency of the 

standard applicable to this equipment. 

AEMTCA also directs DOE to 

determine, within three years of 

enactment of the new SOC.SC.M 

standard, whether this standard should 

be amended. (42 U.S.C. 6313(c)(4)(B)(i)) 

If DOE determines that the standard 

should be amended, then DOE must 

issue a final rule establishing an 

amended standard within this same 

three-year period. (42 U.S.C. 

6313(c)(4)(B)(ii)) 

2. History of Standards Rulemaking for 

Commercial Refrigeration Equipment 

EPCA, as amended by EPACT 2005, 

prescribes energy conservation 

standards for certain self-contained 

commercial refrigeration equipment 

designed for holding temperatures 15

(i.e., commercial refrigerators, freezers, 

and refrigerator-freezers with 

transparent and solid doors designed for 

holding temperature applications) and 

self-contained commercial refrigerators 

with transparent doors designed for 

pull-down temperature applications.16

Compliance with these standards was 

required as of January 1, 2010. (42 

U.S.C. 6313(c)(2)–(3)) DOE published a 

technical amendment final rule on 

October 18, 2005 codifying these 

standards into subpart C of part 431 

under title 10 of the Code of Federal 

Regulations (CFR). 70 FR at 60407. 

In addition, EPCA requires DOE to set 

standards for additional commercial 

refrigeration equipment that is not 

covered by 42 U.S.C. 6313(c)(2)–(3), 

namely commercial ice-cream freezers; 

self-contained commercial refrigerators, 

freezers, and refrigerator-freezers 

without doors; and remote condensing 

commercial refrigerators, freezers, and 

refrigerator-freezers. (42 U.S.C. 

6313(c)(5)) DOE published a final rule 

establishing these standards on January 

9, 2009 (74 FR 1092), and manufacturers 

must comply with these standards 

starting on January 1, 2012. (42 U.S.C. 

6313(c)(5)(A)) 

EPCA requires DOE to conduct a 

subsequent rulemaking to determine 

whether to amend the standards 

established under 42 U.S.C. 6313(c), 

which includes both the standards 

prescribed by EPACT 2005 and those 

prescribed by DOE in the January 2009 

final rule. (42 U.S.C. 6313(c)(6)) If DOE 

decides as part of this ongoing 

rulemaking to amend the current 

standards, DOE must publish a final 

rule establishing any such amended 

standards by January 1, 2013. Id. 

To satisfy this requirement, DOE 

initiated the current rulemaking on 

April 30, 2010 by publishing on its Web 

site its ‘‘Rulemaking Framework for 

Commercial Refrigeration Equipment.’’ 

(The Framework document is available 

at: www1.eere.energy.gov/buildings/

appliance_standards/commercial/pdfs/

cre_framework_04-30-10.pdf.) DOE also 

published a document in the Federal 

Register announcing the availability of 

the Framework document, as well as a 

public meeting to discuss the document. 

The document also solicited comment 

on the matters raised in the document. 

75 FR 24824 (May 6, 2010). The 

Framework document described the 

procedural and analytical approaches 

that DOE anticipated using to evaluate 

energy conservation standards for 

commercial refrigeration equipment, 

and identified various issues to be 

resolved in the rulemaking. 

DOE held the Framework public 

meeting on May 18, 2010, at which it: 

(1) Presented the contents of the 

Framework document; (2) described the 

analyses it planned to conduct during 

the rulemaking; (3) sought comments 

from interested parties on these 

subjects; and (4) in general, sought to 

inform interested parties about, and 

facilitate their involvement in, the 

rulemaking. Major issues discussed at 

the public meeting included: (1) The 

scope of coverage for the rulemaking; (2) 

potential updates to the test procedure 

and appropriate test metrics (being 

addressed in a concurrent rulemaking); 

(3) manufacturer and market 

information, including distribution 

channels; (4) equipment classes, 

baseline units,17 and design options to 

improve efficiency; (5) life-cycle costs to 

customer, including installation, 

maintenance, and repair costs; and (6) 

any customer subgroups DOE should 

consider. At the meeting and during the 

comment period on the Framework 

document, DOE received many 

comments that helped it identify and 

resolve issues pertaining to commercial 

refrigeration equipment relevant to this 

rulemaking. These are discussed in 

subsequent sections of this document. 

DOE then gathered additional 

information and performed preliminary 

analyses to help review energy 

conservation standards for this 

equipment. This process culminated in 

DOE’s notice of a public meeting to 

discuss and receive comments regarding 

the tools and methods DOE used in 

performing its preliminary analysis, as 

well as the analyses results. 76 FR 

17573 (March 30, 2011) (the March 2011 

notice). DOE also invited written 

comments on these subjects and 

announced the availability on its Web 

site of a preliminary analysis technical 

support document (preliminary analysis 

TSD). Id. (The preliminary analysis TSD 

is available at: www.regulations.gov/

#!documentDetail;D=EERE-2010-BTSTD-0003-0030.) 

The preliminary analysis TSD 

provided an overview of DOE’s review 

of the standards for commercial 

refrigeration equipment, discussed the 

comments DOE received in response to 

the Framework document, and 

addressed issues including the scope of 

coverage of the rulemaking. The 

document also described the analytical 

framework that DOE used (and 

continues to use) in considering 

amended standards for commercial 

refrigeration equipment, including a 

description of the methodology, the 

analytical tools, and the relationships 

between the various analyses that are 

part of this rulemaking. Additionally, 

the preliminary analysis TSD presented 

in detail each analysis that DOE had 

performed for this equipment up to that 

point, including descriptions of inputs, 

sources, methodologies, and results. 

These analyses were as follows: 

• A market and technology 

assessment addressed the scope of this 

rulemaking, identified existing and 

potential new equipment classes for 

commercial refrigeration equipment, 

characterized the markets for this 

equipment, and reviewed techniques 

and approaches for improving its 

efficiency; 

• A screening analysis reviewed 

technology options to improve the 


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17734 Federal Register / Vol. 79, No. 60 / Friday, March 28, 2014 / Rules and Regulations 

efficiency of commercial refrigeration 

equipment, and weighed these options 

against DOE’s four prescribed screening 

criteria; 

• An engineering analysis estimated 

the manufacturer selling prices (MSPs) 

associated with more energy efficient 

commercial refrigeration equipment; 

• An energy use analysis estimated 

the annual energy use of commercial 

refrigeration equipment; 

• A markups analysis converted 

estimated MSPs derived from the 

engineering analysis to customer 

purchase prices; 

• A life-cycle cost analysis calculated, 

for individual customers, the 

discounted savings in operating costs 

throughout the estimated average life of 

commercial refrigeration equipment, 

compared to any increase in installed 

costs likely to result directly from the 

imposition of a given standard; 

• A payback period analysis 

estimated the amount of time it would 

take customers to recover the higher 

purchase price of more energy efficient 

equipment through lower operating 

costs; 

• A shipments analysis estimated 

shipments of commercial refrigeration 

equipment over the time period 

examined in the analysis; 

• A national impact analysis (NIA) 

assessed the national energy savings 

(NES), and the national NPV of total 

customer costs and savings, expected to 

result from specific, potential energy 

conservation standards for commercial 

refrigeration equipment; and 

• A preliminary manufacturer impact 

analysis (MIA) took the initial steps in 

evaluating the potential effects on 

manufacturers of amended efficiency 

standards. 

The public meeting announced in the 

March 2011 notice took place on April 

19, 2011 (April 2011 preliminary 

analysis public meeting). At the April 

2011 preliminary analysis public 

meeting, DOE presented the 

methodologies and results of the 

analyses set forth in the preliminary 

analysis TSD. Interested parties 

provided comments on the following 

issues: (1) Equipment classes; (2) 

technology options; (3) energy 

modeling; (4) installation, maintenance, 

and repair costs; (5) markups and 

distributions chains; (6) commercial 

refrigeration equipment shipments; and 

(7) test procedures. 

On September 11, 2013, DOE 

published a notice of proposed 

rulemaking (NOPR) in this proceeding 

(September 2013 NOPR). 78 FR 55890. 

In the September 2013 NOPR, DOE 

addressed, in detail, the comments 

received in earlier stages of rulemaking, 

and proposed amended energy 

conservation standards for commercial 

refrigeration equipment. In conjunction 

with the September 2013 NOPR, DOE 

also published on its Web site the 

complete technical support document 

(TSD) for the proposed rule, which 

incorporated the analyses DOE 

conducted and technical documentation 

for each analysis. Also published on 

DOE’s Web site were the engineering 

analysis spreadsheets, the LCC 

spreadsheet, and the national impact 

analysis standard spreadsheet. These 

materials are available at http://

www1.eere.energy.gov/buildings/

appliance_standards/rulemaking.aspx/

ruleid/27. 

The standards which DOE proposed 

for commercial refrigeration equipment 

at the NOPR stage of this rulemaking are 

shown in Table II.3. They are provided 

solely for background informational 

purposes and differ from the amended 

standards set forth in this final rule. 

TABLE II.3—PROPOSED ENERGY CONSERVATION STANDARDS FOR COMMERCIAL REFRIGERATION EQUIPMENT

[For compliance in 2017] 

Equipment class* Proposed level ** † Equipment class * Proposed standard level ** 

VCT.RC.L ...................................... 0.43 × TDA + 2.03 VOP.RC.I ...................................... 2.68 × TDA + 8.08 

VOP.RC.M ..................................... 0.61 × TDA + 3.03 SVO.RC.L ..................................... 2.11 × TDA + 6.36 

SVO.RC.M ..................................... 0.63 × TDA + 2.41 SVO.RC.I ...................................... 2.68 × TDA + 8.08 

HZO.RC.L ...................................... 0.57 × TDA + 6.88 HZO.RC.I ...................................... 0.72 × TDA + 8.74 

HZO.RC.M ..................................... 0.35 × TDA + 2.88 VOP.SC.L ..................................... 3.79 × TDA + 10.26 

VCT.RC.M ..................................... 0.08 × TDA + 0.72 VOP.SC.I ...................................... 4.81 × TDA + 13.03 

VOP.RC.L ...................................... 2.11 × TDA + 6.36 SVO.SC.L ..................................... 3.77 × TDA + 10.01 

SOC.RC.M ..................................... 0.39 × TDA + 0.08 SVO.SC.I ...................................... 4.79 × TDA + 12.72 

VOP.SC.M ..................................... 1.51 × TDA + 4.09 HZO.SC.I ...................................... 2.44 × TDA + 9.0 

SVO.SC.M ..................................... 1.5 × TDA + 3.99 SOC.RC.L ..................................... 0.83 × TDA + 0.18 

HZO.SC.L ...................................... 1.92 × TDA + 7.08 SOC.RC.I ...................................... 0.97 × TDA + 0.21 

HZO.SC.M ..................................... 0.75 × TDA + 5.44 SOC.SC.I ...................................... 1.35 × TDA + 0.29 

HCT.SC.I ....................................... 0.49 × TDA + 0.37 VCT.RC.I ...................................... 0.51 × TDA + 2.37 

VCT.SC.I ....................................... 0.52 × TDA + 2.56 HCT.RC.M .................................... 0.14 × TDA + 0.11 

VCS.SC.I ....................................... 0.35 × V + 0.81 HCT.RC.L ..................................... 0.3 × TDA + 0.23 

VCT.SC.M ..................................... 0.04 × V + 1.07 HCT.RC.I ...................................... 0.35 × TDA + 0.27 

VCT.SC.L ...................................... 0.22 × V + 1.21 VCS.RC.M .................................... 0.1 × V + 0.24 

VCS.SC.M ..................................... 0.03 × V + 0.53 VCS.RC.L ..................................... 0.21 × V + 0.5 

VCS.SC.L ...................................... 0.13 × V + 0.43 VCS.RC.I ...................................... 0.25 × V + 0.58 

HCT.SC.M ..................................... 0.02 × V + 0.51 HCS.SC.I ...................................... 0.35 × V + 0.81 

HCT.SC.L ...................................... 0.11 × V + 0.6 HCS.RC.M .................................... 0.1 × V + 0.24 

HCS.SC.M ..................................... 0.02 × V + 0.37 HCS.RC.L ..................................... 0.21 × V + 0.5 

HCS.SC.L ...................................... 0.12 × V + 0.42 HCS.RC.I ...................................... 0.25 × V + 0.58 

PD.SC.M ........................................ 0.03 × V + 0.83 SOC.SC.L ..................................... 0.67 × TDA + 1.12 

SOC.SC.M ..................................... 0.32 × TDA + 0.53 

* Equipment class designations consist of a combination (in sequential order separated by periods) of: (1) An equipment family code (VOP = vertical open, SVO 

= semivertical open, HZO = horizontal open, VCT = vertical closed with transparent doors, VCS = vertical closed with solid doors, HCT = horizontal closed with 

transparent doors, HCS = horizontal closed with solid doors, SOC = service over counter, or PD = pull-down); (2) an operating mode code (RC = remote condensing or SC = self-contained); and (3) a rating temperature code (M = medium temperature (38±2 °F), L = low temperature (0±2 °F), or I = ice-cream temperature (¥15±2 °F)). For example, ‘‘VOP.RC.M’’ refers to the ‘‘vertical open, remote condensing, medium temperature’’ equipment class. See discussion in chapter 3 

of the final rule technical support document (TSD) for a more detailed explanation of the equipment class terminology. 

** ‘‘TDA’’ is the total display area of the case, as measured in the Air-Conditioning, Heating, and Refrigeration Institute (AHRI) Standard 1200–2010, appendix D. 

‘‘V’’ is the volume of the case, as measured in American National Standards Institute (ANSI)/Association of Home Appliance Manufacturers (AHAM) Standard 

HRF–1–2004. 

In the September 2013 NOPR, DOE 

identified seven issues on which it was 

particularly interested in receiving 

comments and views of interested 

parties: light-emitting diode (LED) price 

projections, base case efficiency trends, 


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18Night curtains are devices made of an 

insulating material, typically insulated aluminum 

fabric, designed to be pulled down over the open 

front of the case to decrease infiltration and heat 

transfer into the case when the merchandizing 

establishment is closed. 

19The NSF was founded in 1944 as the National 

Sanitation Foundation, and is now referred to 

simply as NSF. 

operating temperature ranges, offset 

factors for smaller equipment, extension 

of standards developed for the 25 

primary classes to the remaining 24 

secondary classes, standards for hybrid 

cases and wedges, and standard levels. 

78 FR 55987 (September 11, 2013) After 

the publication of the September 2013 

NOPR, DOE received written comments 

on these and other issues. DOE also held 

a public meeting in Washington, DC, on 

October 3, 2013, to hear oral comments 

on and solicit information relevant to 

the proposed rule. These comments are 

addressed in today’s document. 

III. General Discussion 

A. Test Procedures and Normalization 

Metrics 

1. Test Procedures 

On December 8, 2006, DOE published 

a final rule in which it adopted 

American National Standards Institute 

(ANSI)/Air-Conditioning and 

Refrigeration Institute (ARI) Standard 

1200–2006, ‘‘Performance Rating of 

Commercial Refrigerated Display 

Merchandisers and Storage Cabinets,’’ 

as the DOE test procedure for this 

equipment. 71 FR at 71340, 71369–70. 

ANSI/ARI Standard 1200–2006 requires 

performance tests to be conducted 

according to the American Society of 

Heating, Refrigerating, and AirConditioning Engineers (ASHRAE) 

Standard 72–2005, ‘‘Method of Testing 

Commercial Refrigerators and Freezers.’’ 

The standard also contains rating 

temperature specifications of 38 °F (+/ 

¥2 °F) for commercial refrigerators and 

refrigerator compartments, 0 °F (+/

¥2 °F) for commercial freezers and 

freezer compartments, and ¥5 °F (+/ 

¥2 °F) for commercial ice-cream 

freezers. During the 2006 test procedure 

rulemaking, DOE determined that 

testing at a ¥15 °F (±2 °F) rating 

temperature was more representative of 

the actual energy consumption of 

commercial freezers specifically 

designed for ice-cream application. 71 

FR at 71357 (December 8, 2006). 

Therefore, in the test procedure final 

rule, DOE adopted a ¥15 °F (±2 °F) 

rating temperature for commercial icecream freezers, rather than the ¥5 °F 

(±2 °F) prescribed in the ANSI/ARI 

Standard 1200–2006. In addition, DOE 

adopted ANSI/Association of Home 

Appliance Manufacturers (AHAM) 

Standard HRF–1–2004, ‘‘Energy, 

Performance, and Capacity of 

Household Refrigerators, RefrigeratorFreezers, and Freezers,’’ for determining 

compartment volumes for this 

equipment. 71 FR at 71369–70 

(December 8, 2006). 

On February 21, 2012, DOE published 

a test procedure final rule (2012 test 

procedure final rule) in which it 

adopted several amendments to the DOE 

test procedure. This included an 

amendment to incorporate by reference 

ANSI/Air-Conditioning, Heating, and 

Refrigeration Institute (AHRI) Standard 

1200–2010, ‘‘Performance Rating of 

Commercial Refrigerated Display 

Merchandisers and Storage Cabinets,’’ 

as the DOE test procedure for this 

equipment. 77 FR 10292, 10314 

(February 21, 2012). The 2012 test 

procedure final rule also included an 

amendment to incorporate by reference 

the updated ANSI/AHAM Standard 

HRF–1–2008, ‘‘Energy, Performance, 

and Capacity of Household 

Refrigerators, Refrigerator-Freezers, and 

Freezers,’’ for determining compartment 

volumes for this equipment. 

In addition, the 2012 test procedure 

final rule included several amendments 

designed to address certain energy 

efficiency features that were not 

accounted for by the previous DOE test 

procedure, including provisions for 

measuring the impact of night 

curtains 18 and lighting occupancy 

sensors and scheduled controls. 77 FR 

at 10296–98 (February 21, 2012). In the 

2012 test procedure final rule, DOE also 

adopted amendments to allow testing of 

commercial refrigeration equipment at 

temperatures other than one of the three 

rating temperatures previously specified 

in the test procedure. Specifically, the 

2012 test procedure final rule allows 

testing of commercial refrigeration 

equipment at its lowest application 

product temperature, for equipment that 

cannot be tested at the prescribed rating 

temperature. The 2012 test procedure 

final rule also allows manufacturers to 

test and certify equipment at the morestringent temperatures and ambient 

conditions required by NSF for food 

safety testing.19 77 FR at 10305 

(February 21, 2012). 

The test procedure amendments 

established in the 2012 test procedure 

final rule are required to be used in 

conjunction with the amended 

standards promulgated in this energy 

conservation standards final rule. As 

such, use of the amended test procedure 

to show compliance with DOE energy 

conservation standards or make 

representations with respect to energy 

consumption of commercial 

refrigeration equipment is required on 

the compliance date of the revised 

energy conservation standards 

established by today’s document. 77 FR 

at 10308 (February 21, 2012). 

DOE has initiated a test procedure 

rulemaking for commercial refrigeration 

equipment to revise and reorganize its 

test procedure for commercial 

refrigeration equipment in order to 

clarify certain terms, procedures, and 

compliance dates. A NOPR for this 

rulemaking was published on October 

28, 2013. 78 FR 64206 (October 28. 

2013). In the NOPR, DOE addressed: 

• Several inquiries received from 

interested parties regarding the 

applicability of DOE’s test procedure 

and current Federal energy conservation 

standards; 

• The definitions of certain terms 

pertinent to commercial refrigeration 

equipment; 

• The proper configuration and use of 

certain components and features of 

commercial refrigeration equipment 

when testing according to the DOE test 

procedure; 

• The proper application of certain 

test procedure provisions; 

• The compliance date of certain 

provisions specified in the DOE test 

procedure final rule published on 

February 21, 2012; and 

• A number of test procedure 

clarifications which arose as a result of 

the negotiated rulemaking process for 

certification of commercial heating, 

ventilation, air conditioning, 

refrigeration, and water heating 

equipment. 

DOE also held a public meeting in 

Washington, DC, on December 5, 2013, 

to hear oral comments on and solicit 

information relevant to the proposed 

rule. 

2. Normalization Metrics 

Both the January 2009 final rule and 

EPACT 2005 contain energy 

conservation standards for respective 

covered types of commercial 

refrigeration equipment, expressed in 

the form of equations developed as a 

function of unit size. This use of 

normalization metrics allows for a 

single standard-level equation 

developed for an equipment class to 

apply to a broad range of equipment 

sizes offered within that class by 

manufacturers. In the aforementioned 

commercial refrigeration equipment 

standards, the two normalization 

metrics used are refrigerated 

compartment volume, as determined 

using AHAM HRF–1–2004, and TDA, as 

determined using ANSI/ARI 1200–2006. 

In particular, the EPACT 2005 standards 


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20 DOE also presents a sensitivity analysis that 

considers impacts for products shipped in a 9-year 

period. 

21 In the past, DOE presented energy savings 

results for only the 30-year period that begins in the 

year of compliance. In the calculation of economic 

impacts, however, DOE considered operating cost 

savings measured over the entire lifetime of 

products purchased during the 30-year period. DOE 

has chosen to modify its presentation of national 

energy savings to be consistent with the approach 

used for its national economic analysis. 

utilize volume as the normalization 

metric for all equipment types, with the 

exception of refrigerator-freezers with 

solid doors, for which the standard 

specifies adjusted volume. (42 U.S.C. 

6313(c)(2)) The January 2009 final rule, 

meanwhile, utilizes TDA as the 

normalization metric for all equipment 

with display capacity while specifying 

volume as the metric for solid-door 

(VCS and HCS) equipment. 74 FR at 

1093 (January 9, 2009). 

At the May 2010 Framework public 

meeting, interested parties raised 

several questions regarding the potential 

normalization metrics that could be 

used in amended standards. DOE also 

received stakeholder feedback 

pertaining to this issue following the 

publication of the Framework 

document. In the preliminary analysis, 

DOE suggested that it would consider 

retaining the normalization metrics in 

this rulemaking for the respective 

classes to which they were applied in 

EPCA (42 U.S.C. 6313(c)(2)–(3)) and the 

January 2009 final rule. 74 FR at 1093 

(January 9, 2009). In chapter 2 of the 

preliminary analysis TSD, DOE 

presented its rationale for the continued 

use of TDA for equipment with display 

areas addressed in the January 2009 

final rule and the continued use of 

volume as the metric for solid-door 

remote condensing equipment and icecream freezers, as well as for the 

equipment covered by EPACT 2005 

standards. DOE maintained this stance 

in the NOPR document and TSD. DOE 

did not receive any significant 

information or data while conducting 

the final rule analyses that would alter 

this position, and thus DOE includes 

continued use of the existing 

normalization metrics in today’s 

document. 

B. Technological Feasibility 

1. General 

In each standards rulemaking, DOE 

conducts a screening analysis, which is 

based on information that the 

Department has gathered on all current 

technology options and prototype 

designs that could improve the 

efficiency of the products or equipment 

that are the subject of the rulemaking. 

As the first step in such analysis, DOE 

develops a list of design options for 

consideration, in consultation with 

manufacturers, design engineers, and 

other interested parties. DOE then 

determines which of these options for 

improving efficiency are technologically 

feasible. DOE considers a design option 

to be technologically feasible if it is 

used by the relevant industry or if a 

working prototype has been developed. 

Technologies incorporated in 

commercially available equipment or in 

working prototypes will be considered 

technologically feasible. 10 CFR part 

430, subpart C, appendix A, section 

4(a)(4)(i) Although DOE considers 

technologies that are proprietary, it will 

not consider efficiency levels that can 

only be reached through the use of 

proprietary technologies (i.e., a unique 

pathway), which could allow a single 

manufacturer to monopolize the market. 

Once DOE has determined that 

particular design options are 

technologically feasible, it further 

evaluates each of these design options 

in light of the following additional 

screening criteria: (1) Practicability to 

manufacture, install, or service; (2) 

adverse impacts on product utility or 

availability; and (3) adverse impacts on 

health or safety. 10 CFR part 430, 

subpart C, appendix A, section 

4(a)(4)(ii)–(iv) Chapter 4 of the final rule 

TSD discusses the results of the 

screening analyses for commercial 

refrigeration equipment. Specifically, it 

presents the designs DOE considered, 

those it screened out, and those that are 

the bases for the TSLs considered in this 

rulemaking. 

2. Maximum Technologically Feasible 

Levels 

When DOE adopts (or does not adopt) 

an amended or new energy conservation 

standard for a type or class of covered 

equipment such as commercial 

refrigeration equipment, it determines 

the maximum improvement in energy 

efficiency that is technologically 

feasible for such equipment. (See 42 

U.S.C. 6295(p)(1) and 6316(e)(1)) 

Accordingly, DOE determined the 

maximum technologically feasible 

(‘‘max-tech’’) improvements in energy 

efficiency for commercial refrigeration 

equipment in the engineering analysis 

using the design parameters that passed 

the screening analysis. 

As indicated previously, whether 

efficiency levels exist or can be 

achieved in commonly used equipment 

is not relevant to whether they are 

considered max-tech levels. DOE 

considers technologies to be 

technologically feasible if they are 

incorporated in any currently available 

equipment or working prototypes. 

Hence, a max-tech level results from the 

combination of design options predicted 

to result in the highest efficiency level 

possible for an equipment class, with 

such design options consisting of 

technologies already incorporated in 

commercial equipment or working 

prototypes. DOE notes that it 

reevaluated the efficiency levels, 

including the max-tech levels, when it 

updated its results for this final rule. 

See chapter 5 of the TSD for the results 

of the analyses and a list of technologies 

included in max-tech equipment. Table 

III.1 shows the max-tech levels 

determined in the engineering analysis 

for commercial refrigeration equipment. 

TABLE III.1—‘‘MAX-TECH’’ LEVELS FOR

COMMERCIAL REFRIGERATION

EQUIPMENT PRIMARY CLASSES

Equipment class 

‘‘Max-Tech’’ 

level 

kWh/day 

VCT.RC.L ............................. 33.044 

VOP.RC.M ............................ 35.652 

SVO.RC.M ............................ 27.702 

HZO.RC.L ............................. 31.078 

HZO.RC.M ............................ 14.15 

VCT.RC.M ............................ 10.988 

VOP.RC.L ............................. 100.006 

SOC.RC.M ............................ 21.560 

VOP.SC.M ............................ 29.714 

SVO.SC.M ............................ 25.400 

HZO.SC.L ............................. 29.922 

HZO.SC.M ............................ 13.748 

HCT.SC.I .............................. 2.327 

VCT.SC.I ............................... 18.106 

VCS.SC.I .............................. 16.042 

VCT.SC.M ............................. 5.148 

VCT.SC.L .............................. 16.048 

VCS.SC.M ............................ 3.028 

VCS.SC.L ............................. 11.130 

HCT.SC.M ............................ 0.614 

HCT.SC.L ............................. 1.315 

HCS.SC.M ............................ 0.981 

HCS.SC.L ............................. 0.713 

PD.SC.M ............................... 3.405 

SOC.SC.M ............................ 26.119 

C. Energy Savings 

1. Determination of Savings 

For each TSL, DOE projected energy 

savings from the products that are the 

subjects of this rulemaking purchased 

during a 30-year period that begins in 

the year of compliance with amended 

standards (2017–2046).20 The savings 

are measured over the entire lifetime of 

products purchased in the 30-year 

period.21 DOE used the NIA model to 

estimate the NES for equipment 

purchased over the period 2017–2046. 

The model forecasts total energy use 

over the analysis period for each 

representative equipment class at 

efficiency levels set by each of the 

considered TSLs. DOE then compares 


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22 ‘‘Review of Site (Point-of-Use) and Full-FuelCycle Measurement Approaches to DOE/EERE 

Building Appliance Energy- Efficiency Standards,’’ 

(Academy report) was completed in May 2009 and 

included five recommendations. A copy of the 

study can be downloaded at: http://www.nap.edu/ 

catalog.php?record_id=12670. 

the energy use at each TSL to the basecase energy use to obtain the NES. The 

NIA model is described in section IV.H 

of this document and in chapter 10 of 

the final rule TSD. 

DOE used its NIA spreadsheet model 

to estimate energy savings from 

amended standards for the equipment 

that is the subject of this rulemaking. 

The NIA spreadsheet model (described 

in section IV.H of this document) 

calculates energy savings in site energy, 

which is the energy directly consumed 

by products at the locations where they 

are used. For electricity, DOE reports 

national energy savings in terms of the 

savings in the energy that is used to 

generate and transmit the site 

electricity. To calculate this quantity, 

DOE derives annual conversion factors 

from the model used to prepare the 

Energy Information Administration’s 

(EIA) Annual Energy Outlook (AEO). 

DOE also has begun to estimate fullfuel-cycle energy savings. 76 FR 51282 

(August 18, 2011), as amended at 77 FR 

49701 (August 17, 2012). The full-fuelcycle (FFC) metric includes the energy 

consumed in extracting, processing, and 

transporting primary fuels, and thus 

presents a more complete picture of the 

impacts of energy efficiency standards. 

DOE’s evaluation of FFC savings is 

driven in part by the National Academy 

of Science’s (NAS) report on FFC 

measurement approaches for DOE’s 

Appliance Standards Program.22 The 

NAS report discusses that FFC was 

primarily intended for energy efficiency 

standards rulemakings where multiple 

fuels may be used by a particular 

product. In the case of this rulemaking 

pertaining to commercial refrigeration 

equipment, only a single fuel— 

electricity—is consumed by the 

equipment. DOE’s approach is based on 

the calculation of an FFC multiplier for 

each of the energy types used by 

covered equipment. Although the 

addition of FFC energy savings in the 

rulemakings is consistent with the 

recommendations, the methodology for 

estimating FFC does not project how 

fuel markets would respond to this 

particular standard rulemaking. The 

FFC methodology simply estimates how 

much additional energy, and in turn 

how many tons of emissions, may be 

displaced if the estimated fuel were not 

consumed by the equipment covered in 

this rulemaking. It is also important to 

note that inclusion of FFC savings does 

not affect DOE’s choice of proposed 

standards. 76 FR 51282 (August 18, 

2011), as amended at 77 FR 49701 

(August 17, 2012). The FFC metric 

includes the energy consumed in 

extracting, processing, and transporting 

primary fuels (i.e., coal, natural gas, 

petroleum fuels), and thus presents a 

more complete picture of the impacts of 

energy efficiency standards. For more 

information on FFC energy savings, see 

section IV.H.2. 

2. Significance of Savings 

EPCA prohibits DOE from adopting a 

standard that would not result in 

significant additional energy savings. 

(42 U.S.C. 6295(o)(3)(B),(v) and 

6316(e)(1)) While the term ‘‘significant’’ 

is not defined in EPCA, the U.S. Court 

of Appeals for the District of Columbia 

in Natural Resources Defense Council v. 

Herrington, 768 F.2d 1355, 1373 (D.C. 

Cir. 1985), indicated that Congress 

intended significant energy savings to 

be savings that were not ‘‘genuinely 

trivial.’’ 

D. Economic Justification 

1. Specific Criteria 

As discussed in section III.D.1, EPCA 

provides seven factors to be evaluated in 

determining whether a potential energy 

conservation standard is economically 

justified. (42 U.S.C. 6295(o)(2)(B)(i) and 

6316(e)(1)) The following sections 

generally discuss how DOE is 

addressing each of those seven factors in 

this rulemaking. For further details and 

the results of DOE’s analyses pertaining 

to economic justification, see sections 

III.C and V of today’s document. 

a. Economic Impact on Manufacturers 

and Commercial Customers 

In determining the impacts of a 

potential new or amended energy 

conservation standard on 

manufacturers, DOE first determines its 

quantitative impacts using an annual 

cash flow approach. This includes both 

a short-term assessment (based on the 

cost and capital requirements associated 

with new or amended standards during 

the period between the announcement 

of a regulation and the compliance date 

of the regulation) and a long-term 

assessment (based on the costs and 

marginal impacts over the 30-year 

analysis period). The impacts analyzed 

include INPV (which values the 

industry based on expected future cash 

flows), cash flows by year, changes in 

revenue and income, and other 

measures of impact, as appropriate. 

Second, DOE analyzes and reports the 

potential impacts on different types of 

manufacturers, paying particular 

attention to impacts on small 

manufacturers. Third, DOE considers 

the impact of new or amended 

standards on domestic manufacturer 

employment and manufacturing 

capacity, as well as the potential for 

new or amended standards to result in 

plant closures and loss of capital 

investment. Finally, DOE takes into 

account cumulative impacts of other 

DOE regulations and non-DOE 

regulatory requirements on 

manufacturers. 

For individual customers, measures of 

economic impact include the changes in 

LCC and the PBP associated with new 

or amended standards. These measures 

are discussed further in the following 

section. For consumers in the aggregate, 

DOE also calculates the national net 

present value of the economic impacts 

applicable to a particular rulemaking. 

DOE also evaluates the LCC impacts of 

potential standards on identifiable 

subgroups of consumers that may be 

affected disproportionately by a national 

standard. 

b. Savings in Operating Costs Compared 

To Increase in Price 

EPCA requires DOE to consider the 

savings in operating costs throughout 

the estimated average life of the covered 

product compared to any increase in the 

price of the covered product that are 

likely to result from the imposition of 

the standard. (42 U.S.C. 

6295(o)(2)(B)(i)(II) and 6316(e)(1)) DOE 

conducts this comparison in its LCC and 

PBP analysis. 

The LCC is the sum of the purchase 

price of equipment (including the cost 

of its installation) and the operating 

costs (including energy and 

maintenance and repair costs) 

discounted over the lifetime of the 

equipment. To account for uncertainty 

and variability in specific inputs, such 

as product lifetime and discount rate, 

DOE uses a distribution of values, with 

probabilities attached to each value. For 

its analysis, DOE assumes that 

consumers will purchase the covered 

products in the first year of compliance 

with amended standards. 

The LCC savings and the PBP for the 

considered efficiency levels are 

calculated relative to a base-case 

scenario, which reflects likely trends in 

the absence of new or amended 

standards. DOE identifies the percentage 

of consumers estimated to receive LCC 

savings or experience an LCC increase, 

in addition to the average LCC savings 

associated with a particular standard 

level. 


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c. Energy Savings 

While significant conservation of 

energy is a statutory requirement for 

imposing an energy conservation 

standard, EPCA also requires DOE, in 

determining the economic justification 

of a standard, to consider the total 

projected energy savings that are 

expected to result directly from the 

standard. (42 U.S.C. 6295(o)(2)(B)(i)(III) 

and 6316(e)(1)) DOE uses NIA 

spreadsheet results in its consideration 

of total projected savings. For the results 

of DOE’s analyses related to the 

potential energy savings, see section 

I.A.3 of this document and chapter 10 

of the final rule TSD. 

d. Lessening of Utility or Performance of 

Equipment 

In establishing classes of equipment, 

and in evaluating design options and 

the impact of potential standard levels, 

DOE seeks to develop standards that 

would not lessen the utility or 

performance of the equipment under 

consideration. DOE has determined that 

none of the TSLs presented in today’s 

final rule would reduce the utility or 

performance of the equipment 

considered in the rulemaking. (42 U.S.C. 

6295(o)(2)(B)(i)(IV) and 6316(e)(1)) 

During the screening analysis, DOE 

eliminated from consideration any 

technology that would adversely impact 

customer utility. For the results of 

DOE’s analyses related to the potential 

impact of amended standards on 

equipment utility and performance, see 

section IV.C of this document and 

chapter 4 of the final rule TSD. 

e. Impact of Any Lessening of 

Competition 

EPCA requires DOE to consider any 

lessening of competition that is likely to 

result from setting new or amended 

standards for covered equipment. 

Consistent with its obligations under 

EPCA, DOE sought the views of the 

United States Department of Justice 

(DOJ). DOE asked DOJ to provide a 

written determination of the impact, if 

any, of any lessening of competition 

likely to result from the amended 

standards, together with an analysis of 

the nature and extent of such impact. 42 

U.S.C. 6295(o)(2)(B)(i)(V) and (B)(ii). 

To assist DOJ in making such a 

determination, DOE provided DOJ with 

copies of both the NOPR and NOPR TSD 

for review. DOJ subsequently 

determined that the amended standards 

are unlikely to have a significant 

adverse impact on competition. 

f. Need of the Nation To Conserve 

Energy 

Another factor that DOE must 

consider in determining whether a new 

or amended standard is economically 

justified is the need for national energy 

and water conservation. (42 U.S.C. 

6295(o)(2)(B)(i)(VI) and 6316(e)(1)) The 

energy savings from new or amended 

standards are likely to provide 

improvements to the security and 

reliability of the Nation’s energy system. 

Reductions in the demand for electricity 

may also result in reduced costs for 

maintaining the reliability of the 

Nation’s electricity system. DOE 

conducts a utility impact analysis to 

estimate how new or amended 

standards may affect the Nation’s 

needed power generation capacity. 

Energy savings from amended 

standards for commercial refrigeration 

equipment are also likely to result in 

environmental benefits in the form of 

reduced emissions of air pollutants and 

GHGs associated with energy 

production (i.e., from power plants). For 

a discussion of the results of the 

analyses relating to the potential 

environmental benefits of the amended 

standards, see sections IV.K, IV.L and 

V.B.6 of this document. DOE reports the 

expected environmental effects from the 

amended standards, as well as from 

each TSL it considered for commercial 

refrigeration equipment, in the 

emissions analysis contained in chapter 

13 of the final rule TSD. DOE also 

reports estimates of the economic value 

of emissions reductions resulting from 

the considered TSLs in chapter 14 of the 

final rule TSD. 

g. Other Factors 

EPCA allows the Secretary, in 

determining whether a new or amended 

standard is economically justified, to 

consider any other factors that the 

Secretary deems to be relevant. (42 

U.S.C. 6295(o)(2)(B)(i)(VII) and 

6316(e)(1)) There were no other factors 

considered for today’s final rule. 

2. Rebuttable Presumption 

As set forth in 42 U.S.C. 

6295(o)(2)(B)(iii) and 6316(e)(1), EPCA 

provides for a rebuttable presumption 

that an energy conservation standard is 

economically justified if the additional 

cost to the customer of equipment that 

meets the new or amended standard 

level is less than three times the value 

of the first-year energy (and, as 

applicable, water) savings resulting from 

the standard, as calculated under the 

applicable DOE test procedure. DOE’s 

LCC and PBP analyses generate values 

that calculate the PBP for customers of 

potential new and amended energy 

conservation standards. These analyses 

include, but are not limited to, the 3- 

year PBP contemplated under the 

rebuttable presumption test. However, 

DOE routinely conducts a full economic 

analysis that considers the full range of 

impacts to the customer, manufacturer, 

Nation, and environment, as required 

under 42 U.S.C. 6295(o)(2)(B)(i) and 

6316(e)(1). The results of these analyses 

serve as the basis for DOE to evaluate 

the economic justification for a potential 

standard level definitively (thereby 

supporting or rebutting the results of 

any preliminary determination of 

economic justification). The rebuttable 

presumption payback calculation is 

discussed in section IV.F.12 of this 

document and chapter 8 of the final rule 

TSD. 

IV. Methodology and Discussion of 

Comments 

A. General Rulemaking Issues 

During the October 2013 NOPR public 

meeting, and in subsequent written 

comments, stakeholders provided input 

regarding general issues pertinent to the 

rulemaking, including the trial standard 

levels and proposed standard levels 

presented, the rulemaking timeline, the 

metrics used to normalize equipment 

size, and other subjects. These issues are 

discussed in this section. 

1. Trial Standard Levels 

In his comment, Mr. R. Kopp (Kopp) 

suggested that using continuous energyefficiency cost-curves as opposed to 

discrete TSLs would provide a more 

accurate analysis. Further, he suggested 

that instead of setting a single TSL 

standard, DOE should adopt pathways 

to improve efficiency. (Kopp, No. 60 at 

p. 5) 

In its engineering analysis, DOE 

utilized a design-option approach, in 

which it began by modeling baseline 

units and then modeled increasingly 

efficient designs up to max-tech by 

adding design options one at a time in 

order of ascending payback period. This 

methodology reflects the options 

available to manufacturers in increasing 

the efficiency of their equipment, which 

consist of piecewise design 

improvements corresponding to the 

design options modeled in the 

engineering analysis. Therefore, the 

efficiency levels generated from the 

engineering analysis and carried 

through the downstream analyses to the 

development of TSLs correspond to 

specific packages of technologies and 

design features which could be 

developed and built by manufacturers. 

Since the stepwise increments along the 


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23 In the comment citation format used in this 

document, the citation first presents the name of the 

commenter, followed by the number on the docket 

corresponding to the document in which the 

comment is contained, followed by a reference to 

the page in that document on which the comment 

can be found. 

24ENERGY STAR is a joint program of the U.S. 

Environmental Protection Agency (EPA) and DOE 

that establishes a voluntary rating, certification, and 

labeling program for highly energy efficient 

consumer products and commercial equipment. 

Information on the program is available at: 

www.energystar.gov. 

cost-efficiency curve represent tangible 

efficiency improvements attainable 

through the implementation of design 

options, DOE asserts that a smooth costefficiency curve would not be realistic, 

as the areas on the curve between the 

current efficiency levels would not 

correspond to any design that exists. 

Therefore, DOE has retained the 

approach used in the NOPR in 

developing this final rule. 

2. Proposed Standard Levels 

Traulsen, Structural Concepts Corp. 

(Structural Concepts), National Rural 

Electric Cooperative Association 

(NRECA), and the Edison Electric 

Institute (EEI) asserted that TSL4, the 

level proposed in the NOPR, was not 

economically viable, noting that the 

marginal efficiency increase over TSL 3 

did not justify the increased costs of 

compliance. (Traulsen, No. 65 at p. 

16; 23 Structural Concepts, Public 

Meeting Transcript, No. 62 at p. 337; 

NRECA, No. 88 at p. 2; EEI, No. 89 at 

p. 4) Traulsen opined that any TSL with 

a payback period longer than 3 years 

was not feasible for most manufacturers. 

(Traulsen, No. 65 at p. 21) Further, 

NRECA and EEI urged DOE to select 

TSL 3 instead of TSL 4. However, the 

joint comments from the American 

Council for an Energy-Efficient 

Economy (ACEEE), National Resources 

Defense Council (NRDC), Appliance 

Standards Awareness Project (ASAP), 

Alliance to Save Energy (ASE), and 

Northwest Energy Efficiency Alliance 

(NEEA) (hereafter referred to as the 

‘‘Joint Comment’’) supported DOE’s 

proposal to adopt TSL 4, noting that it 

represented maximum energy savings 

with a positive NPV. (Joint Comment, 

No. 91 at p. 1) 

Several manufacturers expressed an 

expected inability to meet the proposed 

standard levels, even with the best 

available technology. At the October 

public meeting, Zero Zone Inc. (Zero 

Zone) noted that there had been no 

significant technological advancements 

since the previous rulemaking which 

would make an amended standard 

feasible. (Zero Zone, Public Meeting 

Transcript, No. 62 at p. 62) Structural 

Concepts raised a similar concern, 

noting that despite using the most 

efficient technology currently available, 

its minimum attainable daily energy 

consumption was 30–40% above the 

proposed standard level. (Structural 

Concepts, Public Meeting Transcript, 

No. 62 at p. 133) Royal Vendors Inc. 

(Royal Vendors), in its written 

comment, noted that even with the most 

efficient currently-available technology, 

the maximum possible efficiency gain 

was 10% over the levels contained in 

the ENERGY STAR24 Version 3 

specification. However, the Joint 

Comment opined that most of these 

concerns were limited to pull-down 

equipment, and that if the standard for 

that class were revised, there would be 

no need to revise standards for other 

classes. (Joint Comment, No. 91 at p. 2) 

Additionally, manufacturers opined that 

the percentage reduction in energy 

consumption between the existing 

standard and the proposed rule was not 

achievable. Hussmann Corp. 

(Hussmann), True Manufacturing Co., 

Inc. (True), and Hoshizaki America, Inc. 

(Hoshizaki) all commented that the 

efficiency improvements in excess of 

60%, as proposed for SC equipment and 

the VCT.RC.M class, were neither 

economically feasible nor 

technologically possible. (Hussmann, 

No. 77 at p. 10) (True, No. 76 at p. 1) 

(Hoshizaki, No. 84 at p. 1) 

Hoshizaki noted in its written 

comment that a large majority of 

currently ENERGY STAR-certified 

equipment would fail to meet the 

proposed standard. (Hoshizaki, No. 84 

at p. 1) During the public meeting, 

Structural Concepts pointed out the 

relationship between the proposed 

standard and the ENERGY STAR 

Version 3.0 requirement, opining that it 

was impractical for a standard to be 

more stringent than the ENERGY STAR 

requirement. (Structural Concepts, 

Public Meeting Transcript, No. 62 at p. 

305) The Joint Comment, however, 

noted that according to the ENERGY 

STAR-qualified products list, there 

already are products in five major selfcontained equipment classes that meet 

or exceed the proposed standard. 

Further, the Joint Comment drew 

comparison to the 2009 final rule for 

residential refrigerators, noting that 

proceeding to be a precedent in which 

units on the market were not reaching 

the maximum technically feasible 

efficiency level modeled, since no 

product was using all the design options 

considered in DOE’s analysis. (Joint 

Comment, No. 91 at p. 3) Additionally, 

joint comments from the California 

Investor Owned Utilities (CA IOUs) 

noted that all equipment currently listed 

in the CEC product database for the 

VOP.SC.M, SVO.SC.M, HZO.SC.M, and 

HZO.RC.M classes already met the 

proposed standard. (CA IOUs, No. 63 at 

p. 1) 

Stakeholders noted that, in the 

proposed rule, the expected efficiency 

improvement over existing standards 

was more stringent for some equipment 

classes than for others. Lennox 

International Inc. (Lennox) urged DOE 

to set standards for VCT classes which 

had the same percentage reduction from 

existing standard levels as open-case 

classes, and suggested that stricter VCT 

standards would encourage consumers 

to switch from closed to open 

equipment. (Lennox, No. 73 at p. 4) 

Structural Concepts opined that the 

proposed change in MDEC for SOC 

equipment was too drastic, further 

noting that for SOC and VCS equipment 

classes, it is counterintuitive for DOE to 

propose a greater relationship between 

size and daily energy consumption for 

remote condensing units than for selfcontained units, since SC units are 

inherently less efficient. (Structural 

Concepts, No. 85 at p. 3) Coca-Cola, Inc. 

(Coca-Cola) commented that the TSL 4 

standard was more stringent for 

PD.SC.M units than for VCT.SC.M, and 

that this was counterintuitive. (CocaCola, Public Meeting Transcript, No. 62 

at p. 100) The CA IOUs pointed out in 

its written comment that the current 

standards for PD.SC.M were set through 

a negotiated process, whereas the 

standards for other classes were 

modeled. (CA IOUs, No. 63 at p. 6) 

China commented that while DOE 

proposed stricter standards for the 

VCT.RC.M class since the 2009 final 

rule, DOE was not suggesting amended 

standards for the HZO class. (China, No. 

92 at p. 3) 

Another concern amongst 

manufacturers and consumers was the 

belief that the proposed standard levels 

were based on technology that was 

currently not available, but rather which 

DOE projected would be available at the 

time of required compliance with the 

proposed rule. Continental opined that 

it was impractical to develop standards 

based on currently unavailable 

technologies. (Continental, Public 

Meeting Transcript, No. 62 at p. 96) 

Coca-Cola commented that since the 

proposed standards were based on 

technology which was not yet available, 

the proposed standards, specifically 

TSL4 for VCT.SC.M units, were not 

technologically feasible. (Coca-Cola, 

Public Meeting Transcript, No. 62 at p. 

74) True expressed agreement with 

Coca-Cola, stating that the proposed 

efficiency levels were beyond the level 


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25ENERGY STAR only maintains standard levels 

applying to equipment classes VCS.SC.M, 

VCS.SC.L, VCT.SC.M, VCT.SC.L, HCS.SC.M, 

HCS.SC.L, HCT.SC.M, and HCT.SC.L. Thus, these 

were the only classes for which a comparison 

between the DOE and ENERGY STAR levels could 

be made. 

of what industry can meet at the current 

time. (True, Public Meeting Transcript, 

No. 62 at p. 307) Lennox commented 

that the proposed standards for VCT 

units were unattainable with currently 

known technology and were not 

economically justified. Lennox further 

commented that under the proposed 

rule, only a very limited number of 

compliant VCT products would be 

produced and sold. (Lennox, No. 73 at 

p. 2) The North American Association of 

Food Equipment Manufacturers 

(NAFEM) noted that none of its member 

manufacturers were able to identify 

current technology options or prototype 

designs which met the proposed 

standard levels, and that using 

assumptions beyond what was available 

in the current market landscape would 

also improperly quantify the impact of 

the proposed rule on manufacturer 

costs. (NAFEM, No. 93 at p. 3) 

Additionally, during the October 

public meeting Coca-Cola and True 

commented that food safety was of 

prime importance in the design of their 

equipment, and should take precedence 

over energy savings. (Coca-Cola, Public 

Meeting Transcript, No. 62 at p. 86) 

(True, Public Meeting Transcript, No. 62 

at p. 350) National Restaurant 

Association (NRA) noted that the 

proposed standards had the potential to 

reduce cooling ability and recovery time 

for equipment subject to constant 

opening and closing, and that this 

reduced performance could compromise 

food safety. (NRA, No. 90 at p. 3) 

Similarly, NAFEM also noted that the 

implementation of the proposed 

standards would have potential negative 

effects on food safety for end-users. 

(NAFEM, No. 93 at p. 5) 

DOE understands the concerns voiced 

by stakeholders regarding their future 

ability to meet standard levels as 

proposed in the NOPR. Between the 

NOPR and final rule stages, DOE revised 

and updated its analysis based on 

stakeholders comments received at the 

NOPR public meeting and in written 

comments. These updates included 

improvements to the modeling of 

equipment geometries, design 

specifications, and design option 

performance and costs so as to provide 

a more accurate model of baseline and 

higher-efficiency designs across the 

classes analyzed. After applying these 

updates, DOE amended its TSLs and 

standard level equations accordingly. 

With respect to the comments from Zero 

Zone, Structural Concepts, and Royal 

Vendors regarding the ability of 

technologies needed to meet the 

proposed standard level, DOE analyzed 

the available technologies in its market 

and technology assessment and 

screening analyses, and incorporated 

appropriate and available technology 

options in the modeling performed as 

part of its engineering analysis. 

Therefore, DOE believes that the 

technologies and designs included in 

the analysis accurately reflect what is 

available to industry for improving 

equipment efficiency. 

In response to the Joint Comment, 

DOE notes that it evaluated equipment 

performance independently for each 

equipment class and thus did not revise 

standards for any one class solely based 

upon factors affecting another class. 

DOE believes that the updates and 

improvements to the modeling applied 

between the NOPR and final rule stages 

of this rulemaking have resulted in 

standard levels presented in today’s 

final rule which address the concerns 

voiced by stakeholders after publication 

of the NOPR. 

In response to stakeholder comments 

comparing the proposed standard levels 

to ENERGY STAR levels, DOE cautions 

against direct comparisons between its 

standards and those set forth by 

ENERGY STAR due to the different 

natures of the programs and how the 

two different sets of standard levels are 

set. ENERGY STAR is a voluntary 

program which derives its standard 

levels from market data based on the 

performance of certain models of 

equipment currently available for 

purchase. ENERGY STAR also does not 

model performance or include 

consumer economics in its standardsetting process. DOE sets its standards 

as applicable to all covered equipment 

and develops them through specific 

analyses of equipment performance and 

modeling of economic impacts and 

other downstream effects. Due to the 

different goals and methodologies of 

these two programs, a direct comparison 

may not be entirely relevant. However, 

during the final rule stage, for relevant 

equipment classes,25 DOE did compare 

its engineering results to available 

ENERGY STAR data as a means of 

checking the modeled performance 

levels against empirical test data. With 

respect to the comparison by the 

California IOUs of performance of open 

cases to certified values from the CEC 

directory, DOE also cautions that this 

directory is not exhaustive. For 

example, a search of the directory shows 

that, for some equipment classes, only 

equipment from a single manufacturer is 

included. Therefore, while directory 

data is helpful in providing a check on 

DOE’s results, DOE has performed 

independent modeling and analysis to 

derive its standard levels. 

With respect to the concerns about the 

relative perceived stringencies of 

proposed standards for different classes, 

in the NOPR analyses, DOE examined 

each equipment class independently 

based on standard geometries and 

feature sets for representative units 

within the classes. DOE then conducted 

the engineering simulations and 

downstream economic analyses 

separately for each primary class 

examined. The results presented at the 

NOPR stage represent the suggested 

performance and cost values for each 

class based on the best available 

information at the time of that analysis. 

Therefore, DOE cautions against 

comparative examination of the relative 

stringencies of the various standard 

levels, as each was calculated 

independently and the performance and 

economic benefits of individual design 

options vary specific to each class. DOE 

also agrees with the California IOUs that 

previous standard levels should not 

necessarily be used as a check on 

current analytical results because the 

origins of those standards are not 

completely transparent, meaning that a 

direct comparison may be inappropriate 

due to differences between the 

methodologies used to set those 

standards and those used by DOE in the 

current rulemaking. At the final rule 

stage, DOE continued to examine each 

class independently based on the merits 

of the available efficiency-improving 

features, and has set amended standards 

for each class based on the results of 

those analyses. 

In response to the assertions that 

DOE’s standard levels were not based 

upon currently available technologies, 

but rather were dependent upon future 

potential technological developments, 

DOE maintains that all technology 

options and equipment configurations 

included in its NOPR reflect 

technologies currently in use in 

commercial refrigeration equipment or 

related equipment types. DOE has 

observed these design options and 

features used in current manufacturer 

models offered for sale. The specific 

inputs which it used to model these 

design options, such as compressor 

efficiency improvements over the 

market baseline, glass door U-factor, or 

heat exchanger UA, were provided to 

the public for comment in the NOPR 

TSD and engineering analysis 

spreadsheet, and DOE has updated 

those inputs according to stakeholder 


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26Appendix A to subpart C of 10 CFR part 430, 

‘‘Procedures, Interpretations, and Policies for 

Consideration of New or Revised Energy 

Conservation Standards for Consumer Products’’ is 

known as ‘‘The Process Rule.’’ 

27This refers to the NSF/ANSI 7 procedure used 

to test equipment performance for food safety. 

feedback and other information 

available during the final rule stage. 

DOE understands the concerns voiced 

by Coca-Cola, True, NAFEM, and NRA 

regarding food safety. DOE realizes that 

food safety is of the utmost importance 

to the industry, and is in fact a 

definitional aspect of the design of 

equipment for food storage 

temperatures. In its screening analysis, 

DOE is compelled by sections 4(b)(4) 

and 5(b) of the Process Rule 26 to 

eliminate from consideration any 

technology that presents unacceptable 

problems with respect to a specific set 

of criteria, including impacts on 

equipment utility. Therefore, DOE 

removed from consideration 

technologies and design options which 

could result in such adverse impacts. 

Additionally, in its engineering 

analysis, DOE modeled mediumtemperature equipment as having an 

average product temperature of 38°F, 

consistent with the rating temperature 

specified in the DOE test procedure and 

below the 41°F requirement of the NSF 

7 27 food safety rating procedure. Thus, 

the daily energy consumption values 

produced in the engineering analysis 

reflect a level of equipment performance 

which ensures preservation of the 

ability to maintain food safety 

temperatures. 

3. Rulemaking Timeline 

Some stakeholders felt that in light of 

the large number of analytical changes 

that could be required between the 

NOPR and final rule, DOE should 

extend the target date for publication of 

the final rule. Traulsen requested that 

DOE slow the rulemaking process down 

due to the aggressiveness of the final 

rule date. (Traulsen, Public Meeting 

Transcript, No. 62 at p. 347) 

Hillphoenix and Lennox also expressed 

the same concern, noting that a 

February 2014 deadline for publication 

of the final rule allowed insufficient 

time for the reevaluation of DOE’s 

engineering analysis. (Hillphoenix, No. 

71 at p. 3) (Lennox, No. 73 at p. 2) In 

contrast, the New York State Attorney 

General (NYSAG) commented that the 

delay in amending these efficiency 

standards not only violated 

Congressional mandates, but has also 

prolonged the time that inefficient 

products stay in the market. NYSAG 

further commented that these delays 

have led to avoidable pollution and 

waste of resources. (NYSAG, No. 92 at 

p. 1) 

While DOE appreciates the input from 

commenters requesting that the timeline 

for this rulemaking be extended, none of 

the commenters has provided any 

details or specifics with regard to what 

specifically they believe would require 

extra time. In reviewing its analyses to 

date, the inputs received at the NOPR 

public meeting and in subsequent 

written comment, DOE believes that the 

time allotted is sufficient in order to 

allow for full and proper analysis 

required in order to develop the final 

rule. In fact, DOE conducted an efficient 

and thorough effort to promulgate the 

final rule within the constraints of the 

time allotted. With regard to NYSAG’s 

comment, DOE notes that it has moved 

as efficiently as possible while 

conducting the thorough analysis 

required to set appropriate standards. 

4. Normalization Metrics 

Following publication of the NOPR, 

DOE received comment on the 

normalization metrics used to scale 

allowable daily energy consumption 

under the standard levels as a function 

of equipment size. Depending on the 

design and intended application of each 

equipment class, DOE proposed energy 

standard levels using either total display 

area or volume as a metric. Structural 

Concepts commented that DOE’s 

metrics for the VCT and HCT families 

were inconsistent, since some proposed 

standards for classes within the families 

were based on total display area (TDA) 

while others were based on volume, 

NAFEM stated that industry 

participants use volume, rather than 

linear feet, to estimate total market size. 

(Structural Concepts, No. 85 at p. 3) 

(NAFEM, No. 93 at p. 6) 

DOE understands that the selection of 

appropriate measures of case size is 

important to the standards-setting 

process across all covered equipment 

classes. For the self-contained 

equipment with doors for which 

standards were set in the EPACT 2005 

legislation, volume was identified in the 

statute as the normalization metric. (42 

U.S.C. 6313(c)(2)) For the equipment 

covered by the 2009 final rule, DOE 

selected the metrics of volume for 

equipment with solid doors and TDA 

for display-type equipment. Because 

radiation and conduction through doors 

are the primary heat transfer pathways 

for CRE equipment with transparent 

doors, DOE concluded that TDA is the 

metric that best quantifies this effect. 

Likewise, for equipment without doors, 

the majority of heat load occurs due to 

warm air infiltration, and DOE 

determined that TDA would also be the 

most appropriate metric for capturing 

these effects. DOE also stated its 

conclusion that for these equipment 

types, where the function is to display 

merchandise for sale, TDA best 

quantifies the ability of a piece of 

equipment to perform that function. On 

the other hand, equipment with solid 

doors is designed for storage, and 

volume was determined to be the most 

appropriate metric for quantifying the 

storage capacity of the unit. 72 FR 

41177–78 (July 26, 2007). 

DOE does not believe, based on its 

discussions with manufacturers and 

comments solicited over the course of 

this rulemaking that the fundamental 

concepts underlying the choices of TDA 

or volume as the normalization metric 

for any given class of equipment have 

changed. In line with the reasons stated 

above, DOE is retaining the current 

normalization metrics for the respective 

equipment classes, consisting of both 

the metrics set forth in the 2009 final 

rule and those prescribed by the EPACT 

2005 standards for self-contained 

equipment with doors. 

In response to the comment from 

NAFEM regarding the usage of linear 

feet, DOE wishes to clarify that it did 

not use linear feet of equipment as a 

measure of equipment size in its 

engineering analysis, nor as a metric 

when estimating total market size in its 

shipments analysis. Rather, DOE 

utilized linear feet as a normalization 

metric in the national impacts and other 

downstream analyses when accounting 

for the aggregate costs and benefits of 

today’s final rule. DOE believes that the 

units used in making representations of 

equipment market size are accurate, and 

DOE did not modify them for the final 

rule analysis. 

5. Conformance With Executive Orders 

and Departmental Policies 

At the NOPR public meeting, and in 

a subsequent written comment, 

Traulsen opined that the proposed rule 

violates Executive Order 12866. 

Specifically, Traulsen stated that the 

rule failed to identify the failures of 

private markets or public institutions 

that warrant new agency action, since 

the industry had actively embraced 

voluntary efficiency goals and 

standards. (Traulsen, No. 65 at p.16) 

Section 1(b)(1) of Executive Order 12866 

requires each agency to identify the 

problem that it intends to address, 

including, where applicable, the failures 

of private markets or public institutions 

that warrant new agency action, as well 

as to assess the significance of that 

problem. In section VI.A of today’s 

document (and also in the NOPR), DOE 

has identified the problems that it has 


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28https://www.directives.doe.gov/references/

secretarial_policy_statement_on_scientific_

integrity/view. 

addressed by amending energy 

conservation standards for commercial 

refrigeration equipment. For certain 

segments of the companies that 

purchase commercial refrigeration 

equipment, such as small grocers, these 

problems may include a lack of 

consumer information and/or 

information processing capability about 

energy efficiency opportunities in the 

commercial refrigeration equipment 

market. In addition, the market for 

commercial refrigeration equipment is 

affected by electricity prices that do not 

reflect all of the social and 

environmental costs associated with 

electricity use. When such externalities 

are not included in the decisions made 

by market actors, this is considered a 

market failure by economists. 

Traulsen asserted that the proposed 

rule was in violation of Executive Order 

13563 and the Information Quality Act 

since the assumptions in DOE’s analysis 

did not use the best available techniques 

to quantify the benefits of the rule. 

(Traulsen, No. 65 at pp.16–17) DOE 

believes that the analysis described in 

today’s document is based on the best 

available techniques that were suited to 

the data available to analyze commercial 

refrigeration equipment. Further, 

Traulsen did not point to any specific 

techniques in its comment that would 

have been superior to those employed 

by DOE. 

NAFEM expressed concern that the 

proposed rule was in violation of 

Executive Orders because it had a 

disproportionate negative impact on 

small businesses, failed to consider nonregulatory alternatives, and since DOE 

had made no contact with end-users in 

order to understand impact on users. 

(NAFEM, No. 93 at p. 14) Traulsen 

stated that DOE should consider 

supplementing regulatory action with 

other forms of non-regulatory 

alternatives, such as expanded 

collaboration with ENERGY STAR, 

rebates, and incentive programs. 

(Traulsen, No. 65 at p. 15) 

As discussed in section V.B.1.b of this 

document, DOE believes that today’s 

rule would not have a disproportionate 

negative impact on small businesses. 

DOE did consider non-regulatory 

alternatives to amended standards, as 

described in detail in chapter 17 of the 

final rule TSD. Finally, DOE requested 

comment from the public and held 

public meetings that were attended by 

representatives of end-users of 

commercial refrigeration equipment 

(e.g., ACCA, Coca-Cola, and NAFEM). 

NAFEM also opined that the proposed 

rule violated the Secretarial Policy 

Statement of Scientific Integrity, since 

the analysis was not independently 

peer-reviewed by qualified experts, 

underlying assumptions were not 

clearly explained, and since DOE failed 

to accurately contextualize uncertainties 

pertaining to non-regulatory 

alternatives. (NAFEM, No. 93 at p. 14) 

The Secretary’s March 23, 2012 

‘‘Secretarial Policy Statement of 

Scientific Integrity’’ 28 sets forth a policy 

for DOE employees and states, in 

relevant part, that ‘‘DOE will ensure that 

data and research used to support policy 

decisions are of high scientific and 

technical objectivity. Scientific and 

technical objectivity will be supported 

through independent peer review by 

qualified experts, where feasible and 

appropriate, and consistent with law.’’ 

With respect to DOE’s analysis 

underlying this final rule, DOE has 

solicited and thoroughly considered 

comment and data from expert CRE 

manufacturers throughout the 

rulemaking process. DOE does not 

believe that any additional expert 

review of its analysis is either necessary 

or appropriate. 

Further, the assumptions used in 

DOE’s analysis are described in detail in 

the NOPR TSD and in the final rule 

TSD. DOE is not aware of the 

uncertainties pertaining to nonregulatory alternatives mentioned only 

in a general sense by NAFEM. 

6. Offset Factors 

In presenting the NOPR standard 

levels, DOE adopted and modified the 

offset factors from the 2009 final rule 

and EPACT 2005 standard levels to 

define the energy consumption of a unit 

at zero volume or TDA, thus setting the 

y-intercepts of the linear standard level 

equations proposed at levels intended to 

represent ‘‘end effects’’ inherent in all 

equipment. Some stakeholders 

expressed disagreement with DOE’s 

modeling of offset factors. Hillphoenix 

commented that offset factors were 

designed to account for factors which 

remained constant over a range of 

equipment sizes. Hillphoenix further 

commented that such factors as 

conduction end effects typically do not 

vary with size. (Hillphoenix, No. 71 at 

p. 2) Traulsen commented that DOE’s 

modeled offset factors were not 

empirically determined. (Traulsen, No. 

65 at p. 19) The Air-Conditioning, 

Heating, and Refrigeration Institute 

(AHRI) commented that it was 

impossible for stakeholders to compare 

the offset factors within the current 

rulemaking with the previous 

rulemaking’s values. (AHRI, No. 75 at p. 

14) 

In developing offset factors for the 

NOPR, DOE scaled existing offset factors 

from the EPACT 2005 and 2009 final 

rule standard levels based on the 

percentage reduction in energy use 

modeled at the representative unit size. 

This allowed the NOPR standard level 

equations to reflect energy allowances 

which proposed a standard percentage 

reduction in allowable consumption 

across all equipment sizes. While DOE 

agrees with Traulsen that the offset 

factors were not empirically 

determined, the factors were based upon 

scaling proportional to modeled 

equipment performance and applied to 

the existing offset factors which have 

been well-established and vetted 

through development of and compliance 

with the existing standards containing 

them. 

In response to the comment from 

Hillphoenix, DOE agrees that there are 

certain fixed effects which will be 

encountered by any piece of equipment, 

such as a minimum amount of 

conduction, or energy consumption 

attributable to the presence of a 

minimum of a single fan motor, for 

example. For the final rule, and in 

response to the concern of stakeholders, 

DOE adjusted its offset factors to 

account for these constant effects. In 

equipment for which DOE developed 

offset factors for use in standard level 

equations in its 2009 final rule, DOE 

retained the same offset factors in the 

development of the trial standard levels 

presented in today’s document. DOE 

believes that the retention of these 

factors accurately reflects the presence 

of fixed end-effect behavior in this 

equipment, which remains independent 

of the design options elsewise 

implemented in the equipment. For the 

equipment for which standard levels 

were set by EPACT 2005, DOE had no 

background information as to how those 

offset factors were developed. Therefore, 

in developing trial standard levels for 

today’s final rule, DOE adjusted those 

offset factors based on available data 

from directories of certified product 

performance. For more information on 

the development of offset factors, please 

see chapter 5 of the final rule TSD. 

B. Market and Technology Assessment 

When beginning an energy 

conservation standards rulemaking, 

DOE develops information that provides 

an overall picture of the market for the 

equipment concerned, including the 

purpose of the equipment, the industry 

structure, and market characteristics. 

This activity includes both quantitative 

and qualitative assessments based 


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29An air curtain is a continuously moving stream 

of air, driven by fans, which exits on one side of 

the opening in an open refrigerated case and reenters on the other side via an intake grille. The 

function of the air curtain is to cover the opening 

in the case with this sheet of air, which minimizes 

the infiltration of warmer ambient air into the 

refrigerated space. 

primarily on publicly available 

information (e.g., manufacturer 

specification sheets, industry 

publications) and data submitted by 

manufacturers, trade associations, and 

other stakeholders. The subjects 

addressed in the market and technology 

assessment for this rulemaking include: 

(1) Quantities and types of equipment 

sold and offered for sale; (2) retail 

market trends; (3) equipment covered by 

the rulemaking; (4) equipment classes; 

(5) manufacturers; (6) regulatory 

requirements and non-regulatory 

programs (such as rebate programs and 

tax credits); and (7) technologies that 

could improve the energy efficiency of 

the equipment under examination. DOE 

researched manufacturers of commercial 

refrigeration equipment and made a 

particular effort to identify and 

characterize small business 

manufacturers. See chapter 3 of the final 

rule TSD for further discussion of the 

market and technology assessment. 

1. Equipment Classes 

In evaluating and establishing energy 

conservation standards, DOE generally 

divides covered equipment into classes 

by the type of energy used, or by 

capacity or other performance-related 

feature that justifies a different standard 

for equipment having such a feature. (42 

U.S.C. 6295(q) and 6316(e)(1)) In 

deciding whether a feature justifies a 

different standard, DOE must consider 

factors such as the utility of the feature 

to users. DOE normally establishes 

different energy conservation standards 

for different equipment classes based on 

these criteria. 

Commercial refrigeration equipment 

can be divided into various equipment 

classes categorized by specific physical 

and design characteristics. These 

characteristics impact equipment 

efficiency, determine the kind of 

merchandise that the equipment can be 

used to display, and affect how the 

customer can access that merchandise. 

Key physical and design characteristics 

of commercial refrigeration equipment 

are the operating temperature, the 

presence or absence of doors (i.e., closed 

cases or open cases), the type of doors 

used (transparent or solid), the angle of 

the door or air curtain 29 (horizontal, 

semivertical, or vertical), and the type of 

condensing unit (remote condensing or 

self-contained). The following list 

shows the key characteristics of 

commercial refrigeration equipment that 

DOE developed as part of the January 

2009 final rule (74 FR at 1099–1100 

(January 9, 2009)), and used during this 

rulemaking: 

1. Operating Temperature 

• Medium temperature (38 °F, 

refrigerators) 

• Low temperature (0 °F, freezers) 

• Ice-cream temperature (¥15 °F, icecream freezers) 

2. Door Type 

• Equipment with transparent doors 

• Equipment with solid doors 

• Equipment without doors 

3. Orientation (air-curtain or door angle) 

• Horizontal 

• Semivertical 

• Vertical 

4. Type of Condensing Unit 

• Remote condensing 

• Self-contained 

Additionally, because EPCA 

specifically sets a separate standard for 

refrigerators with a self-contained 

condensing unit designed for pull-down 

temperature applications and 

transparent doors, DOE has created a 

separate equipment class for this 

equipment. (42 U.S.C. 6313(c)(3)) DOE 

included this equipment in the form of 

a separate family with a single class 

(PD.SC.M). A total of 49 equipment 

classes were created, and these are 

listed in chapter 3 of the TSD using the 

nomenclature developed in the January 

2009 final rule. 74 FR at 1100 (January 

9, 2009). 

During the October 2013 NOPR public 

meeting and in subsequent written 

comments, a number of stakeholders 

addressed issues related to proposed 

equipment classes and the inclusion of 

certain types of equipment in the 

analysis. These topics are discussed in 

this section. 

a. Equipment Subcategories 

In their written comments, 

Continental, NAFEM, True and 

Traulsen all expressed concern that the 

equipment classes defined by DOE in 

the proposed rule did not sufficiently 

encompass various sub-classifications, 

especially with regard to pass-through 

and reach-in cases. (Continental, No. 87 

at p. 1) (NAFEM, No. 93 at p. 7) (True, 

No. 76 at p. 3) (Traulsen, No. 65 at p. 

16) Further, Traulsen and True pointed 

out that a multitude of custom-built and 

niche equipment exists, which would 

require further analysis in order to 

determine a viable standard. (Traulsen, 

No. 65 at p. 20) (True, No. 76 at p. 1) 

In response to the concerns of 

interested parties, DOE believes that its 

existing equipment class structure is 

sufficient to account for the majority of 

variation in type and combination of 

equipment geometry, condensing unit 

configuration, and operating 

temperature. DOE provides allowances 

in its standards to account for the 

energy needs of different equipment 

sizes through its use of standard level 

equations constructed in the form of 

linear equations varying with 

equipment size (as measured by volume 

or TDA) and through its use of offset 

factors to represent energy end-effects. 

DOE also accommodates variation in 

operating temperature outside of its 

three rating temperatures through the 

use of a lowest application product 

temperature provision in its test 

procedure. 77 FR at 10305 (February 21, 

2012) 

b. Floral Equipment 

In the context of niche equipment 

classes, the Society of American Florists 

(SAF) noted that the floral industry uses 

purpose-designed refrigeration 

equipment, including sliding door floral 

display coolers (self-contained), open 

air access floral display coolers (reachin), countertop floral display coolers 

and long door floral display coolers 

(swinging or sliding doors, top-mounted 

or remote condensing unit). SAF further 

added that most of these units are 

custom-built, since floral cooling 

systems are balanced to keep humidity 

high, and that special low-velocity coils 

are utilized to blow air through the unit 

while maintaining temperature and high 

humidity levels—features not available 

in stock equipment. (SAF, No. 74 at p. 

3) 

DOE believes that its division of 

covered equipment into numerous 

classes is sufficiently broad to capture 

the level of differentiation present 

within the commercial refrigeration 

equipment market. The equipment types 

described in the comment from SAF 

would fall into a number of existing 

equipment classes for which DOE has 

conducted analyses in this rulemaking. 

Additionally, DOE has recognized the 

temperature issues which may be 

present in floral cases, and has 

accommodated those different operating 

temperatures by developing and 

implementing a provision in its test 

procedure allowing equipment which 

cannot reach the specified DOE rating 

temperature to be tested at its lowest 

application product temperature. 77 FR 

at 10305 (February 21, 2012) 

2. Technology Assessment 

As part of the market and technology 

assessment performed for the final rule 

analysis, DOE developed a 

comprehensive list of technologies that 

would be expected to improve the 


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energy efficiency of commercial 

refrigeration equipment. Chapter 3 of 

the TSD contains a detailed description 

of each technology that DOE identified. 

Although DOE identified a complete list 

of technologies that improve efficiency, 

DOE only considered in its analysis 

technologies that would impact the 

efficiency rating of equipment as tested 

under the DOE test procedure. 

Therefore, DOE excluded several 

technologies from the analysis during 

the technology assessment because they 

do not improve the rated efficiency of 

equipment as measured under the 

specified test procedure. Technologies 

that DOE determined impact the rated 

efficiency were carried through to the 

screening analysis and are discussed in 

section IV.C. 

a. Technologies Applicable to All 

Equipment 

In the NOPR analysis market and 

technology assessment, DOE listed the 

following technologies that would be 

expected to improve the efficiency of all 

equipment: higher efficiency lighting, 

higher efficiency lighting ballasts, 

remote lighting ballast location, higher 

efficiency expansion valves, higher 

efficiency evaporator fan motors, 

variable-speed evaporator fan motors 

and evaporator fan motor controllers, 

higher efficiency evaporator fan blades, 

increased evaporator surface area, lowpressure differential evaporators, 

increased case insulation or 

improvements, defrost mechanisms, 

defrost cycle controls, vacuum insulated 

panels, and occupancy sensors for 

lighting controls. These technologies are 

discussed in depth in chapter 3 of the 

NOPR TSD. Not all of these technologies 

were considered in the engineering 

analysis; some were screened out or 

removed from consideration on 

technical grounds. After the publication 

of the NOPR analysis, DOE received 

numerous stakeholder comments 

regarding these technologies, discussed 

below. 

Low Pressure Differential Evaporators 

Traulsen commented that low 

pressure differential evaporators would 

require larger spaces between fins and 

tubes, which could in turn reduce 

overall efficiency by allowing frost 

build-up. (Traulsen, No. 65 at p. 7) Lowpressure differential evaporators reduce 

energy consumption by reducing the 

power of evaporator fan motors, often by 

increasing the air gap between fins. 

However, as noted in chapter 5 of the 

NOPR TSD, in space-constrained 

equipment such as commercial 

refrigeration equipment, this reduction 

usually comes from a decrease in 

evaporator coil surface area, which 

generally requires a lower saturated 

evaporator temperature (SET) to achieve 

the same discharge air temperature and 

cooling potential. This, in turn, results 

in a reduction in compressor efficiency. 

Therefore, DOE agrees with Traulsen 

that low pressure differential 

evaporators are not a viable option for 

consideration in this rulemaking and 

did not consider them as a design 

option. 

Defrost Mechanisms 

Traulsen commented that in order for 

DOE to advocate for improved defrost 

sensors, new designs would need to be 

implemented, and that the compliance 

date suggested in the NOPR would not 

allow for the levels of research and 

development (R&D) necessary to achieve 

this improvement. (Traulsen, No. 65 at 

p. 8) DOE wishes to clarify that it did 

not consider advanced defrost sensors 

as a design option within the analyses 

conducted at the NOPR or final rule 

stages of this rulemaking. Much 

equipment currently manufactured 

already uses partial defrost cycle control 

in the form of cycle temperaturetermination control. However, defrost 

cycle initiation is still scheduled at 

regular intervals. Full defrost cycle 

control would involve a method of 

detecting frost buildup and initiating 

defrost. This could be accomplished 

using an optical sensor or through use 

of a sensor to detect the temperature 

differential across the evaporator coil. 

However, DOE understands that both of 

these methods are currently unreliable 

due to fouling of the coil with dust and 

other surface contaminants, which 

becomes more of an issue as cases age. 

Because of these issues, DOE agrees 

with Traulsen’s concerns and did not 

consider defrost cycle control as a 

design option at the NOPR or final rule 

stages. Instead, the defrost lengths 

modeled in the engineering analysis 

were based on defrost times gathered 

through review of manufacturer 

literature, manufacturer interviews, and 

data collected through laboratory testing 

of equipment currently available on the 

market. 

Light Emitting Diode Lighting 

After publication of the NOPR, 

Traulsen commented that DOE’s 

assertion of consumer enthusiasm 

towards LEDs lacked basis in reality. 

Further, Traulsen commented that any 

weight given to this assertion in the 

calculations was null. (Traulsen, No. 65 

at p. 4) During its analysis, DOE 

considered design options based on 

their availability on the market and on 

the screening criteria set forth by the 

Process Rule. In considering LED 

lighting as a design option, DOE did so 

after researching existing product 

offerings on the market and conferring 

with manufacturers in confidential 

interviews. DOE did not factor 

‘‘consumer enthusiasm’’ into its 

decision to include LED lighting as 

asserted by Traulsen, but instead 

considered this design option based on 

the information available from the 

current equipment market and the 

technology’s ability to reduce the 

measured energy consumption of 

covered equipment. 

b. Technologies Relevant Only to 

Equipment With Doors 

In chapter 3 of the NOPR TSD, DOE 

mentioned three technologies that could 

apply only to doored equipment: antifog films, anti-sweat heater controllers, 

and high performance doors. Not all of 

these technologies were considered in 

the NOPR engineering analysis, as some 

were screened out or removed from 

consideration on technical grounds. The 

following sections discuss stakeholder 

comments regarding these technologies. 

Anti-Fog Films 

Traulsen commented that while DOE 

called for the use of advanced 

hydrophobic materials in the form of 

anti-fog films to prevent condensation 

build-up, there were concerns with 

regard to the NSF certification of this 

feature. (Traulsen, No. 65 at p. 11) DOE 

wishes to clarify that, while it included 

anti-fog films for consideration in the 

NOPR market and technology 

assessment, it did not include them as 

a design option in the engineering 

analysis. For a full discussion of why 

DOE did not consider anti-fog films, 

please see chapter 5 of the NOPR TSD. 

DOE agrees with Traulsen’s concerns, 

amongst others, and continued to 

exclude this technology from its 

analysis at the final rule stage. 

Anti-Sweat Heater Controllers 

In its statements at the NOPR public 

meeting, the California IOUs urged DOE 

to consider anti-sweat heater controllers 

as a design option due to their large 

savings potential. (CA IOUs, Public 

Meeting Transcript, No. 62 at p. 19) 

However, in its written comment, 

Traulsen pointed out that these may be 

impractical, since sensor technologies 

had high failure rates in kitchen 

environments. (Traulsen, No. 65 at p. 

11) 

DOE addressed consideration of this 

technology in chapter 4 of the NOPR 

TSD. Anti-sweat heater controllers 

modulate the operation of anti-sweat 

heaters by reducing heater power when 


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humidity is low, and operate most 

effectively when a constant ambient 

dew point cannot be maintained. 

However, in the context of the DOE test 

procedure, anti-sweat heater controllers 

solely serve to keep the power to the 

anti-sweat heaters at the levels 

necessary for the test conditions. These 

fixed conditions of 75 °F and 55 percent 

relative humidity are the conditions that 

ASHRAE has determined to be generally 

representative of commercial 

refrigeration equipment operating 

environments and which DOE has 

adopted in its test procedure. While 

anti-sweat heater controllers could 

modulate the anti-sweat power to a 

further extent in the field so as to 

account for more or less extreme 

ambient conditions, a system equipped 

with anti-sweat heater controllers will 

not likely exhibit significantly different 

performance at test procedure 

conditions than a unit with anti-sweat 

heaters tuned for constant 75/55 

conditions. Because they would have no 

impact on measured energy 

consumption under the DOE test 

procedure, DOE did not consider antisweat heater controllers in the 

engineering analysis. 

c. Technologies Applicable Only to 

Equipment Without Doors 

In chapter 3 of the NOPR TSD, DOE 

mentioned two technologies, air-curtain 

design and night curtains, that 

potentially could be used to improve the 

efficiency of commercial refrigeration 

equipment without doors. Air curtain 

design was not considered in the NOPR 

engineering analysis, as it was screened 

out and removed from consideration 

because, according to the information 

available to DOE, advanced air curtain 

designs are still in research and 

development stages and are not yet 

available for use in the manufacture of 

commercial refrigeration equipment. 

The following sections address 

stakeholder comments regarding 

technologies applicable to equipment 

without doors. 

Air-Curtain Design 

In its written comment, Traulsen 

expressed concern over the use of 

advanced air curtain designs. (Traulsen, 

No. 65 at p. 11) DOE agrees with 

Traulsen that advanced air curtain 

designs are not currently a feasible 

option for use in commercial 

refrigeration equipment. Sections 4(a) 

and 5(b) of the Process Rule specifically 

set ‘‘practicability to manufacture, 

install, and service’’ as a criterion that 

should be satisfied for technology to be 

considered as a design option. In 

chapter 4 of the NOPR TSD, DOE 

explained that advanced air curtain 

designs are only in the research stage 

and, therefore, that it would be 

impracticable to manufacture, install, 

and service this technology on the scale 

necessary to serve the relevant market at 

the time an amended standard would 

become effective. For that reason, DOE 

screened out improved air curtains as a 

design option for improving the energy 

efficiency of commercial refrigeration 

equipment. 

C. Screening Analysis 

DOE uses four screening criteria to 

determine which design options are 

suitable for further consideration in a 

standards rulemaking. Namely, design 

options will be removed from 

consideration if they are not 

technologically feasible; are not 

practicable to manufacture, install, or 

service; have adverse impacts on 

product utility or product availability; 

or have adverse impacts on health or 

safety. 10 CFR part 430, subpart C, 

appendix A, sections (4)(a)(4) and (5)(b). 

In comments received after the NOPR 

publication, Traulsen commented that, 

while DOE screened out certain 

technology options due to impacts on 

end-users, it was unclear why the same 

technology option was screened out for 

some equipment classes but not others. 

(Traulsen, No. 65 at p. 2) 

During the screening analysis, DOE 

considered sections 4(b)(4) and 5(b) of 

the Process Rule, which provide 

guidance in determining whether to 

eliminate from consideration any 

technology that presents unacceptable 

problems with respect to certain criteria. 

These criteria include technological 

feasibility, practicability to 

manufacture, install, and service, 

impacts on equipment utility or 

equipment availability, and adverse 

impacts on health or safety. If DOE 

determines that a technology, or a 

combination of technologies, meet any 

of the criteria set forth in section 5(b) of 

the Process Rule, it will be eliminated 

from consideration. This screening 

process is applied to each candidate 

technology being considered, and is 

applicable across all equipment classes. 

Therefore, in response to the comment 

from Traulsen, DOE does not believe 

that it screened out any particular 

technology options for some classes but 

not others. 

Based on all available information, 

DOE has concluded that: (1) All of the 

efficiency levels discussed in today’s 

document are technologically feasible; 

(2) equipment at these efficiency levels 

could be manufactured, installed, and 

serviced on a scale needed to serve the 

relevant markets; (3) these efficiency 

levels would not force manufacturers to 

use technologies that would adversely 

affect product utility or availability; and 

(4) these efficiency levels would not 

adversely affect consumer health or 

safety. Thus, the efficiency levels that 

DOE analyzed and discusses in this 

document are all achievable through 

technology options that were ‘‘screened 

in’’ during the screening analysis. 

D. Engineering Analysis 

The engineering analysis determines 

the manufacturing costs of achieving 

increased efficiency or decreased energy 

consumption. DOE historically has used 

the following three methodologies to 

generate the manufacturing costs 

needed for its engineering analyses: (1) 

The design-option approach, which 

provides the incremental costs of adding 

to a baseline model design options that 

will improve its efficiency; (2) the 

efficiency-level approach, which 

provides the relative costs of achieving 

increases in energy efficiency levels, 

without regard to the particular design 

options used to achieve such increases; 

and (3) the cost-assessment (or reverse 

engineering) approach, which provides 

‘‘bottom-up’’ manufacturing cost 

assessments for achieving various levels 

of increased efficiency, based on 

detailed data as to costs for parts and 

material, labor, shipping/packaging, and 

investment for models that operate at 

particular efficiency levels. 

As discussed in the Framework 

document, preliminary analysis, and 

NOPR analysis, DOE conducted the 

engineering analyses for this rulemaking 

using a design-option approach for 

commercial refrigeration equipment. 

The decision to use this approach was 

made due to several factors, including 

the wide variety of equipment analyzed, 

the lack of numerous levels of 

equipment efficiency currently available 

in the market, and the prevalence of 

relatively easily implementable energysaving technologies applicable to this 

equipment. More specifically, DOE 

identified design options for analysis, 

used a combination of industry research 

and teardown-based cost modeling to 

determine manufacturing costs, and 

employed numerical modeling to 

determine the energy consumption for 

each combination of design options 

used to increase equipment efficiency. 

DOE selected a set of 25 high-shipment 

classes, referred to as ‘‘primary’’ classes, 

to analyze directly in the engineering 

analysis. Additional details of the 

engineering analysis are available in 

chapter 5 of the final rule TSD. 


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1. Representative Equipment for 

Analysis 

a. Representative Unit Selection 

In performing its engineering analysis, 

DOE selected representative units for 

each primary equipment class to serve 

as analysis points in the development of 

cost-efficiency curves. In selecting these 

units, DOE researched the offerings of 

major manufacturers to select models 

that were generally representative of the 

typical offerings produced within the 

given equipment class. Unit sizes, 

configurations, and features were based 

on high-shipment-volume designs 

prevalent in the market. Using this data, 

a set of specifications was developed 

defining a representative unit for each 

primary equipment class. These 

specifications include geometric 

dimensions, quantities of components 

(such as fans), operating temperatures, 

and other case features that are 

necessary to calculate energy 

consumption. Modifications to the units 

modeled were made as needed to ensure 

that those units were representative of 

typical models from industry, rather 

than a specific unit offered by one 

manufacturer. This process created a 

representative unit for each equipment 

class with typical characteristics for 

physical parameters (e.g., volume, 

TDA), and minimum performance of 

energy-consuming components (e.g., 

fans, lighting). 

b. Baseline Models 

DOE created a set of baseline design 

specifications for each equipment class 

analyzed directly in the engineering 

model. Each set of representative 

baseline unit specifications, when 

combined with the lowest technological 

level of each design option applicable to 

the given equipment class, defines the 

energy consumption and cost of the 

lowest efficiency equipment analyzed 

for that class. Chapter 5 of the final rule 

TSD sets forth the specifications that 

DOE chose for each equipment class and 

discusses baseline models in greater 

detail. 

One complexity involved in 

developing an engineering baseline was 

due to the variety of designs and 

technology options that manufacturers 

could utilize in order to meet the 

recently-implemented standards arising 

from EPACT 2005 and the 2009 final 

rule. Through its analyses, DOE 

determined that manufacturers were 

utilizing a wide variety of design paths 

in order to meet the necessary 

performance level. Therefore, in order to 

develop its engineering results for the 

current rule, DOE retained the 

engineering baseline and associated 

technologies used in its January 2009 

final rule engineering analysis and 

expanded them to accommodate the 

new equipment classes covered by the 

standards initially established by EPCA. 

(42 U.S.C. 6313(c)(2)–(3)) DOE then 

added technologies to this baseline to 

develop its cost-efficiency curves, and 

ordered the technology options from 

lowest to highest payback period. The 

result was a set of cost-efficiency curves 

reflecting what DOE believes to be the 

most cost-effective means of meeting the 

existing standards, as well as that of 

attaining the higher levels of 

performance reflected in today’s rule. 

As a result, some of the engineering 

results represent levels of unit 

performance that are below the standard 

levels for equipment currently on the 

market and subject to DOE’s existing 

standards. (10 CFR 431.66). However, in 

its LCC and other downstream analyses, 

DOE accounted for this fact by utilizing 

a standards baseline as the minimum 

efficiency level examined, thereby 

truncating the engineering design option 

levels so that the lowest efficiency point 

analyzed corresponded to the current 

standard level with which that 

particular model of equipment would 

have to comply. The exact procedure is 

described in section IV.F and additional 

details are provided in chapter 8 of the 

final rule TSD. 

After publication of the NOPR and the 

NOPR public meeting, DOE received a 

number of comments from interested 

parties regarding its establishment of 

baseline models, and the features and 

design specifications included in those 

baseline models. The subsequent 

sections contain those comments and 

DOE’s responses. 

Composition of Baseline 

Southern Store Fixtures Inc. 

(Southern Store Fixtures), AHRI, 

Hussmann and Structural Concepts 

expressed concern that, by keeping the 

baseline consistent between the 

previous rule and the proposed rule, 

DOE had failed to account for the 

efficiency improvement brought about 

by the previous standard, thereby 

overestimating the potential for energy 

savings. (Southern Store Fixtures, No. 

67 at p. 2) (AHRI, No. 75 at p. 2) 

(Hussmann, No. 77 at p. 9) (Structural 

Concepts, No. 85 at p. 1) Additionally, 

AHRI noted that although the current 

rulemaking retains the baseline 

specifications and some related 

technologies from the previous 

rulemaking, there are differences in the 

baseline energy consumption across the 

two rulemakings. (AHRI, No. 75 at p. 4) 

The Joint Comment pointed out that, 

for some equipment classes, many 

ENERGY STAR-qualified products were 

rated as being less efficient than the 

modeled baseline. Further, the Joint 

Comment urged DOE to re-evaluate the 

baseline levels for equipment classes for 

which the current standards were 

established by EPACT 2005. (Joint 

Comment, No. 91 at p. 5) 

In response to the comments raised by 

interested parties regarding the modeled 

equipment baseline, DOE points out that 

there is currently no prescriptive 

requirement that commercial 

refrigeration equipment use any specific 

combination of features to meet the 

existing EPACT 2005 or 2009 final rule 

standard levels. For this reason, and in 

order to ensure a proper ordering of the 

implementation of efficiency-improving 

technologies in its engineering analysis, 

DOE started with an engineering 

baseline which was, in many cases, 

below the performance level mandated 

by the current standards. DOE then 

modeled equipment with increasingly 

higher levels of performance by 

implementing the applicable design 

options in order of ascending payback 

period. The result of this was a modeled 

configuration reflecting, based on the 

information available to DOE, the most 

cost-effective way to build a model 

which complies with the existing 

standards. Then, DOE continued to add 

the remaining design options until it 

reached the max-tech level. It was these 

additional efficiency levels above the 

performance level required by the 

existing standard that were considered 

as offering incremental efficiency 

improvements beyond the level required 

at the time of the analysis. 

Energy savings and downstream 

impacts (such as life-cycle cost and 

national net present value results) were 

calculated based on a base case 

efficiency distribution in which 

minimum-efficiency products available 

today are assumed to comply with 

existing standards. Therefore the 

modeled design options up to the level 

of performance required by existing 

standards did not have any impact on 

the energy or cost savings attributed to 

the amended standards prescribed 

today, but rather, served only to align 

the engineering cost-efficiency curve 

with the technologies which present the 

shortest-payback options for reducing 

energy consumption. As a result, DOE 

believes that the assertion of some 

stakeholders that its methodology 

overstates the energy savings 

attributable to today’s rule is inaccurate. 

With regard to the specific technology 

modeling that was discussed by AHRI, 

DOE updated modeling of some baseline 

design options and components from 

the 2009 final rule to the current 


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30Available http://www.energystar.gov/certifiedproducts/certified-products. 

rulemaking to ensure the most accurate 

possible depiction of components 

currently available on the market. In the 

final rule stage, DOE revisited these 

design option parameters based on 

stakeholder comments and further 

revised them where appropriate so as to 

ensure a greater degree of accuracy in 

the engineering model inputs. 

Therefore, DOE understands that there 

may be adjustments to the numerical 

outputs of the modeling of baseline 

units between rulemakings and 

rulemaking stages. 

In response to the issue raised in the 

Joint Comment, DOE wishes to point out 

that the ENERGY STAR-qualified 

directory 30 is, by design, not necessarily 

an exhaustive source of information for 

all models available on the market. 

However, DOE has adjusted its 

modeling of baseline units in the final 

rule stage of the analysis and, in 

conducting comparisons between its 

engineering results and market data 

such as the ENERGY STAR directory, 

has found agreement between the 

performance results obtained from its 

engineering analysis and the data points 

contained in the ENERGY STAR 

directory. 

Condensate Pan Heaters 

In their written comments, 

manufacturers provided input on the 

modeling of condensate pan heaters in 

baseline and higher-performance units. 

Traulsen noted that closed door 

refrigerators were modeled in the NOPR 

engineering analysis as not requiring 

electric condensate pan heaters, while 

freezers were modeled as using this 

component, even though refrigerators 

face the same physical limitations as 

freezers. Further, Traulsen commented 

that DOE should consider the power 

required to bring condensate pan 

heaters to operating temperature and the 

idle power consumption of empty 

condensate pans when reviewing energy 

conservation strategies. Further, 

Traulsen expressed the belief that 

electric condensate pan heaters are an 

important feature which cannot be 

ignored. (Traulsen, No. 65 at p. 1) 

Similarly, Hussmann also commented 

that in self-contained mediumtemperature units, manufacturers are 

required to use condensate evaporator 

pans, the lack of which would reduce 

utility to end-users. (Hussmann, No. 77 

at p. 7) 

In response to the comments provided 

by Traulsen and Hussmann, DOE 

revisited its engineering analysis and 

added condensate pan heaters for 

medium-temperature vertical closeddoor cases to its analytical model. 

Additionally, in response to Traulsen’s 

suggestion, DOE added a factor of an 

additional 10% pan energy 

consumption to its modeling of 

condensate pan energy use in order to 

account for the energy needed to bring 

the pan up to temperature. However, 

DOE did not add further energy in its 

engineering simulation to account for 

idle consumption of empty condensate 

pans, as DOE understands that most 

condensate pan heaters use float 

switches or other sensor devices to 

activate the pan heater only when the 

water level is sufficiently high to require 

it, minimizing operation of heaters with 

empty pans. 

Defrost 

In its written comment, Traulsen 

provided additional information to 

assist in DOE’s modeling of defrost 

systems. Traulsen commented that 

while the DOE model assumed that all 

VCT.SC.M and VCS.SC.M units employ 

off-cycle defrost systems, this is not true 

in real-life applications. Traulsen 

further commented that, for most 

refrigerator models, it uses an electric 

defrost element. Traulsen further noted 

that if electric defrost were included, all 

theoretical models would fail to meet 

the proposed standard. Additionally, 

Traulsen commented that DOE’s model 

seems to ignore desired features such as 

hot-gas defrost and electric defrost 

systems, even though they are widely 

available in the market. 

Traulsen commented that defrost 

cycles tend to terminate when the 

evaporator coil reaches a predetermined 

temperature, but the time period 

required for melting all accumulated 

frost varies with the mass of the 

evaporator coil and surrounding 

components. Further, Traulsen noted 

that the DOE spreadsheet appears not to 

account for these accommodations, and 

fails to account for increased defrost 

length when using enhanced evaporator 

coils, which have a 50% higher mass 

than the baseline coil designs. Traulsen 

commented that, in the DOE NOPR 

engineering model, defrost heater 

wattage only varied in proportion to the 

length of the cabinet, and not with the 

cabinet height or volume. Furthermore, 

Traulsen noted that the heater wattage 

calculated for full-height closed door 

cabinets appear to be too high. 

(Traulsen, No. 65 at p. 11) Structural 

Concepts commented that the 

multipliers used to model defrost cycles 

should differ between open and closed 

type cases. (Structural Concepts, No. 85 

at p. 3) 

After the NOPR public meeting and 

upon receipt of comments, DOE 

researched defrost mechanisms applied 

in medium-temperature applications. 

Specifically, DOE investigated this 

subject through review of manufacturer 

literature such as manuals and 

replacement parts catalogs, as well as 

through testing and teardown of 

selected units. The results of this 

investigation contradicted Traulsen’s 

assertion that electric defrost is 

commonly used in medium-temperature 

units, as DOE did not find evidence of 

this. Additionally, examination of 

public certification databases such as 

the ENERGY STAR directory showed 

equipment performance levels 

inconsistent with the use of substantial 

amounts of electric defrost. Therefore, 

DOE did not find sufficient evidence to 

warrant adding the modeling of electric 

defrost to its engineering analysis. With 

respect to the discussion of hot gas 

defrost, DOE understands that this 

feature is currently used by some 

manufacturers in the market, but did not 

explicitly model it due to concerns 

raised through comments and in 

manufacturer interviews regarding 

reliability issues with this feature. 

In response to the comments from 

Traulsen and Structural Concepts 

regarding defrost cycle lengths, DOE 

based its modeling of defrost cycles for 

various equipment classes based on a 

number of sources, including 

manufacturer literature, manufacturer 

interviews, and testing of equipment 

currently on the market. Thus DOE 

agrees that the defrost length values 

should vary by equipment class, and has 

modeled them as such in its engineering 

analysis. With respect to Traulsen’s 

comment on additional defrost power 

being needed for larger evaporator coils, 

DOE constrained the size of the 

evaporator coils modeled in the final 

rule analysis, thus mitigating concern 

over this issue. Additionally, in the final 

rule engineering analysis, for vertical 

freezers, DOE adjusted the modeled 

defrost heater wattages based on inputs 

from Traulsen’s comment and other 

sources. DOE believes that these 

changes better reflects the actuality of 

defrost mechanisms utilized in these 

equipment classes. 

Lighting Configurations 

Hillphoenix commented that the 

number of shelves, and therefore shelf 

lights, varies greatly for SVO cases 

depending on the height of the case. 

Hillphoenix further commented that 

there exist ‘‘extreme configuration 

differences’’ among cases within the 

same class. (Hillphoenix, No. 71 at p. 4) 


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In developing its engineering analysis 

for this rulemaking, DOE collected data 

on common designs within the industry. 

This information included 

specifications on lighting configurations 

and formed the basis for the 

representative units modeled within the 

engineering analysis. Based on input 

collected over the course of the current 

rulemaking and in the development of 

the 2009 final rule, DOE believes that its 

design specifications, including lighting 

configurations, are accurate and 

representative of the various covered 

classes, including SVO cases. 

Additionally, DOE notes that for SVO 

cases, the allowable energy 

consumption under the existing and 

amended standards is a function of 

TDA. Cases with greater height, such as 

those suggested by Hillphoenix, would 

have a greater measured total display 

area and thus would be allowed a 

proportionally larger amount of energy. 

Therefore, DOE believes that its existing 

analytical methodology accounts for the 

concerns raised by Hillphoenix. 

Infiltration Loads 

Manufacturers opined that DOE’s 

modeling of air infiltration caused by 

door openings could be improved. 

Continental Refrigerator (Continental), 

Hussmann, and Traulsen all commented 

that air exchange during door openings 

significantly affects system energy 

consumption. (Hussmann, No. 77 at p. 

3) (Traulsen, No. 65 at p. 10) 

(Continental, No. 87 at p. 2) 

Specifically, True commented that door 

openings and the resultant air exchange 

could account for between 15% and 

25% of a unit’s energy consumption. 

(True, Public Meeting Transcript, No. 62 

at p. 151) 

Traulsen commented that the energy 

consumption formulas for closed door 

models fail to account for gasket losses 

(heat gain or added load), and that it 

was concerned with the use of the air 

infiltration load models applied, 

especially with respect to closed door 

units, since real world conditions can 

vary from those experienced during the 

ASHRAE test procedure. (Traulsen, No. 

65 at p. 10) Moreover, Continental noted 

that the percentage of air that is 

exchanged varies greatly with the 

configuration and type of cabinet. 

Continental further commented that the 

DOE model did not provide sufficient 

explanation of how air infiltration loads 

were calculated for different cabinet 

types. (Continental, Public Meeting 

Transcript, No. 62 at p. 123) Structural 

Concepts commented that the 

multipliers used to model infiltration 

should differ between open and closed 

type cases. (Structural Concepts, No. 85 

at p. 3) ACEEE commented that tracer 

gas analysis, a well-established 

technology, could be used to analyze the 

actual air exchange that occurs during 

door openings. (ACEEE, Public Meeting 

Transcript, No. 62 at p. 154) 

DOE understands the significance of 

air infiltration and is aware of its impact 

on the modeled energy consumption of 

commercial refrigeration equipment. In 

response to these comments, DOE 

reviewed its modeled infiltrated air 

mass values between the NOPR and 

final rule stages of the rulemaking. 

Specifically, DOE adjusted the values 

for a variety of classes to better align 

with new information presented in 

stakeholder comments and other 

sources. This included adjustments to 

account for the impacts of the respective 

air densities at the three DOE rating 

temperatures, and scaling to better 

simulate the impacts of case geometry. 

For full details on the infiltration levels 

modeled, please refer to chapter 5 and 

appendix 5A of the final rule TSD. 

With respect to the comment from 

True regarding the percentage of case 

heat load attributable to infiltration, 

DOE’s engineering model provides a 

specific breakdown of the constituent 

components of the case heat loads 

modeled in its simulation. A review of 

the DOE engineering model shows the 

contribution of infiltration to case heat 

load for closed-door units to be in line 

with the figures provided by True. In 

response to the comment from Traulsen, 

DOE believes that gasket losses are 

accounted for in its infiltrated air mass 

values. These values were derived from 

manufacturer literature based upon test 

performance under ASHRAE 

conditions, and thus would encapsulate 

all phenomena, including gasket losses, 

encountered by the unit which 

contribute to the infiltration load during 

operation. The engineering model 

simulates performance under the DOE 

test procedure, and thus changes which 

may be encountered in the field such as 

those noted by Traulsen are not 

specifically relevant to the calculated 

daily energy consumption values used 

for standards setting purposes. 

Therefore, DOE does not see a need to 

change its methodology to account for 

this attribute. 

DOE agrees with Continental and 

Structural Concepts that wide variation 

in infiltration is observed among 

different equipment classes, particularly 

between open and closed cases. DOE 

believes that its updated air infiltration 

values better account for differences that 

exist in infiltration loads among cases of 

different configurations, geometries, 

sizes, and operating temperatures. 

With respect to the comment from 

ACEEE, DOE understands that tracer gas 

analysis could be used in a controlled 

laboratory environment to possibly 

determine infiltration rates into 

commercial refrigeration equipment. 

However, within the scope, time frame, 

and resources of this rulemaking 

process, DOE did not pursue that 

method to further investigate infiltration 

effects. Instead, DOE continued to base 

its approach on infiltration load values 

calculated from manufacturer literature, 

and adjusted those values based upon 

comments received after publication of 

the NOPR. DOE believes that this is an 

accurate approach, consistent with 

methodologies employed in other past 

and current rulemakings, which is 

substantiated by the best available data 

as of the time of this analysis. 

2. Design Options 

After conducting the screening 

analysis and removing from 

consideration technologies that did not 

warrant inclusion on technical grounds, 

DOE included the remaining 

technologies as design options in the 

energy consumption model for its 

engineering analysis: 

• Higher efficiency lighting and 

occupancy sensors for VOP, SVO, and 

SOC equipment families (horizontal 

fixtures); 

• higher efficiency lighting and 

occupancy sensors for VCT and PD 

equipment families (vertical fixtures); 

• improved evaporator coil design; 

• higher efficiency evaporator fan 

motors; 

• improved case insulation; 

• improved doors for VCT equipment 

family, low temperature and ice-cream 

temperature (hinged); 

• improved doors for VCT and PD 

equipment families, medium 

temperature (hinged); 

• improved doors for HCT equipment 

family, low temperature and ice-cream 

temperature (sliding); 

• improved doors for HCT equipment 

family, medium temperature (sliding); 

• improved doors for SOC equipment 

family, medium temperature (sliding); 

• improved condenser coil design (for 

self-contained equipment only); 

• higher efficiency condenser fan 

motors (for self-contained equipment 

only); 

• higher efficiency compressors (for 

self-contained equipment only); and 

• night curtains (equipment without 

doors only). 

After publication of the NOPR, DOE 

received a number of comments on its 

choice and implementation of certain 

design options within the engineering 

analysis. The following sections address 

these stakeholder comments. 


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a. Fluorescent Lamp Ballasts 

Traulsen commented that markets 

have already trended towards electronic 

(solid-state) ballasts to modulate power 

provided by T8 lights. Traulsen raised 

concern that DOE analysis might 

therefore be unfairly overstating savings 

from the adoption of TSL4 by including 

electronic ballasts as a design option in 

its analysis. (Traulsen, No. 65 at p. 4) 

DOE understands that electronic 

ballasts are ubiquitous in the 

commercial refrigeration equipment 

market within cases that use fluorescent 

lighting and agrees with the comment 

presented by Traulsen. In its NOPR 

engineering analysis, DOE modeled the 

baseline design option in cases with 

lighting as comprised of T8 fluorescent 

fixtures with electronic ballasts. At 

improved levels of efficiency, DOE 

implemented super-T8 fluorescent 

lighting, LED lighting, and LED lighting 

with occupancy sensors. DOE did not 

model magnetic ballasts within its 

NOPR engineering analysis. Given the 

comments received at the NOPR stage, 

DOE retained this stance in its final rule 

engineering analysis. 

With regard to Traulsen’s assertion 

that DOE might be overstating savings, 

DOE wishes to clarify that energy 

savings and downstream impacts (such 

as life-cycle cost and national net 

present value results) were calculated 

using a base case efficiency distribution 

in which minimum-efficiency products 

available today are assumed to comply 

with existing standards. Therefore, the 

modeled design options up to the level 

of performance required by existing 

standards did not have any impact on 

the energy or cost savings attributed to 

the amended standards set forth today, 

but rather, served only to align the 

engineering cost-efficiency curve with 

the technologies which present the 

shortest-payback options for reducing 

energy consumption. 

b. Condenser Fans 

Southern Store Fixtures and AHRI 

commented that the modeling of 

electronically commutated motors 

(ECMs) in condenser fan applications 

was redundant, since they believe that 

all equipment in compliance with the 

2009 final rule are already using ECMs. 

(Southern Store Fixtures, No. 67 at p. 4) 

(AHRI, No. 75 at p. 7) 

DOE understands that manufacturers 

may currently be choosing to utilize 

ECM fan motors as part of their designs 

on the market. However, the 2009 final 

rule and EPACT 2005 standards do not 

include prescriptive requirements, so 

DOE is unable to assume that 

manufacturers have all used any one 

single design path in order to achieve 

the necessary performance levels. 

Instead, DOE started its analysis with an 

engineering baseline representing 

designs less sophisticated than needed 

to meet the current standard levels, and 

added all available design options, 

including some previously considered 

in the 2009 final rule, until reaching the 

max tech efficiency level. This method 

allowed DOE to order all design options 

in the most cost-effective manner. 

However, only those modeled efficiency 

levels having performance above the 

level required by existing standards 

were considered as contributing to the 

energy and cost savings attributable to 

this rule. For a further explanation of 

this methodology, please see section 

IV.D.1.b, ‘‘Baseline Models.’’ 

c. Evaporator Fans 

Southern Store Fixtures and AHRI 

commented that the modeling of ECM 

fan motors in evaporators was 

redundant, since they believe that all 

equipment in compliance with the 2009 

final rule is already using ECMs. 

(Southern Store Fixtures, No. 67 at p. 4) 

(AHRI, No. 75 at p. 7) Continental 

commented that shutting off the fans 

during door-opening could cause the 

evaporator coil to freeze up, and thus 

that this should not be considered as an 

option. (Continental, Public Meeting 

Transcript, No. 62 at p. 153) 

DOE understands that many 

manufacturers may currently be 

choosing to utilize ECM fan motors as 

part of their designs on the market at 

this time. However, the 2009 final rule 

and EPACT 2005 standards do not 

include prescriptive requirements, so 

DOE was unable to assume that 

manufacturers all chose any one single 

design path in order to achieve the 

necessary performance levels. Instead, 

DOE started with a simpler engineering 

baseline representing equipment 

performance at a lower level than that 

permitted by current standards, and 

added all design options, including 

some previously considered in the 2009 

final rule, until reaching the max tech 

level. This method allowed DOE to 

order all design options in the most 

cost-effective manner. However, only 

those modeled efficiency levels 

performance above the level required by 

existing standards were considered as 

contributing to the energy and cost 

savings attributable to this rule. For a 

further explanation of this methodology, 

please see section IV.D.1.b, ‘‘Baseline 

Models.’’ 

DOE agrees with the concerns of 

Continental regarding turning off 

evaporator fans, and did not model 

evaporator fan controls as a design 

option in this rulemaking due to a 

number of issues including the integrity 

of the air curtain on open cases and food 

safety issues due to lack of air 

circulation arising from stopping the 

evaporator fans. For a full discussion of 

this issue, please see chapter 5 of the 

final rule TSD. 

d. Design Options Impacting Equipment 

Form Factor 

Some manufacturers and consumer 

groups urged DOE to screen out any 

design options which would even 

marginally affect the geometry of a 

model, either by increasing its total 

footprint or reducing the cooled internal 

space. Specifically, these comments 

referred to DOE’s consideration of 

added insulation thickness as a design 

option. True commented that it was 

impractical to increase the total 

footprint of equipment since almost all 

commercial kitchen equipment has a 

fixed footprint and replacement units 

must fit into the same space as old 

units. (True, No. 76 at p. 1) Continental 

commented that a 1⁄2′′ increase in 

insulation of walls could have a 

significant impact on end-users and 

manufacturers, since equipment is often 

designed for very specific footprints and 

layouts. Continental further commented 

that while an inch less inside space or 

an inch larger cabinet may seem 

insignificant, it may be important to 

end-users. (Continental, Public Meeting 

Transcript, No. 62 at p. 103) Traulsen, 

too, noted that both internal capacity 

and footprint of a unit were its key 

selling points. (Traulsen, No. 65 at p. 7) 

Hoshizaki, True, AHRI, NAFEM, SAF, 

Continental, Structural Concepts and 

Hillphoenix all opined that increasing 

the case insulation requirement by even 

1⁄2′′, would lead to a significant increase 

in footprint, or decrease in internal 

volume—both of which would 

detrimentally affect consumer utility, 

since many commercial environments 

have very limited floor space. 

(Hoshizaki, No. 84 at p. 2) (True, No. 76 

at p. 3) (AHRI, No. 75 at p. 6) (NAFEM, 

No. 93 at p. 5) (SAF, No. 74 at p. 6) 

(Continental, No. 87 at p. 3) (Structural 

Concepts, No. 85 at p. 2) (Hillphoenix, 

No. 71 at p. 3) 

DOE understands stakeholder 

concerns over unit form factor, and 

discussed these concerns thoroughly in 

its manufacturer interviews conducted 

at the NOPR stage of the rulemaking. At 

that time, manufacturers agreed that the 

addition of 1⁄2′′ of insulation above the 

baseline thicknesses modeled (1.5′′, 2′′, 

and 2.5′′ for refrigerators, freezers, and 

ice cream freezers, respectively) was 

feasible, albeit at the expense of 

equipment redesign and replacement of 


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31UL standard 471, ‘‘Commercial Refrigerators 

and Freezers,’’ is a safety standard applicable to this 

equipment. Part of this procedure includes a test of 

the ability of the unit to avoid tipping over under 

certain conditions. This is the ‘‘tip test’’ referenced 

by the commenter. 

foaming fixtures. DOE incorporated cost 

figures for these factors into the 

engineering and manufacturer impact 

analyses so as to account for the costs 

of additional foam as a design option. 

With respect to the concerns over 

additional foam thickness having an 

impact on the usefulness of the product 

to consumers, DOE notes that in its 

teardown analyses it encountered a 

number of models currently on the 

market utilizing the increased foam wall 

thicknesses which it modeled. Since 

manufacturers are already employing 

these wall thicknesses in currentlyavailable models, DOE believes that this 

serves as a proof of concept and that the 

resulting changes to form factor would 

be of minimal impact to end users. DOE 

also would like to remind stakeholders 

that it is not setting prescriptive 

standards, and should manufacturers 

value some features over others, they are 

free to use different design paths in 

order to attain the performance levels 

required by today’s rule. 

e. Vacuum Insulated Panels (VIPs) 

True, Structural Concepts, and 

Traulsen commented that the use of 

VIPs is very cost-prohibitive and can 

reduce the structural strength of the 

unit. Additionally, Traulsen 

recommended further discussion on the 

use of vacuum insulated panels, 

specifically on the structural integrity 

and associated trade-offs of this 

technology. (Traulsen, No. 65 at p. 10) 

(True, No. 76 at p. 3) (Structural 

Concepts, No. 85 at p. 2) 

DOE considered vacuum insulated 

panels as a design option in its 

engineering analysis because they have 

the potential to improve equipment 

efficiency, are available on the market 

today, are currently used in refrigeration 

equipment, and pass the screening 

criteria set forth in sections 4(b)(4) and 

5(b) of the Process Rule. However, DOE 

understands that there is a high level of 

cost required to implement this design 

option, including redesign costs, and 

sought to reflect that fact through 

appropriate cost values obtained from 

manufacturer interviews and other 

sources and included in its analyses. As 

a result, vacuum insulated panels 

appear only in max-tech designs for 

each equipment class, and are not 

included in any of the modeled 

configurations selected in setting the 

standard levels put forth in today’s 

document. 

f. Variable-Speed Fan Motors 

Traulsen commented that while DOE 

suggested varying condenser and 

evaporator fan speeds to improve 

performance, Traulsen equipment is 

used in applications in which food 

safety concerns make this option 

infeasible. Traulsen further commented 

that NSF issues related to food safety 

and sanitation must be a primary 

consideration over energy savings. 

(Traulsen, No. 65 at p. 5) However, ebmpapst, Inc. (ebm-papst) noted that 

variable speed condenser fans have 

successfully been deployed in the 

European market. (ebm-papst, No. 70 at 

p. 3) 

DOE agrees with Traulsen’s concerns 

over food safety issues arising from 

possible implementation of evaporator 

fan control schemes. DOE noted in 

chapter 5 of its NOPR TSD that the 

effectiveness of the air curtain in 

equipment without doors is very 

sensitive to changes in airflow, and fan 

motor controllers could disrupt the air 

curtain. The potential of disturbance to 

the air curtain, which could lead to 

higher infiltration loads, does not 

warrant the use of evaporator fan motor 

controllers in equipment without doors, 

even if there were some reduction in fan 

energy use. With respect to equipment 

with doors, DOE, in its discussions with 

manufacturers, found that there are 

concerns in industry about the 

implementation of variable-speed fan 

technology due to the need to meet food 

safety and maximum temperature 

requirements. Varying the fan speed 

would reduce the movement of air 

within the case, potentially leading to 

the development of ‘‘hot spots’’ in some 

areas of the case, where temperatures 

could exceed the desired value. This 

finding aligns with the concerns raised 

by Traulsen. Some industry 

representatives also stated during 

interviews that the use of such 

controllers could have unintended 

consequences, in which fans would be 

inadvertently run at full power to 

attempt to overcome a frosted or dirty 

coil, resulting in wasted energy. Due to 

the uncertainties that exist with respect 

to these technologies, DOE did not 

consider variable-speed evaporator fan 

motors or evaporator fan motor 

controllers as a design option in its 

NOPR or final rule analyses. 

In response to the comment from 

ebm-papst, DOE points out that it 

discussed condenser fan controls in 

chapter 4 of its NOPR TSD. Because 

testing under the ANSI/ASHRAE 

Standard 72 test procedure is conducted 

at a constant ambient temperature, there 

is little opportunity to account for the 

adaptive technology of varying 

condenser fan motor speed to reduce 

daily energy consumption of a given 

model. Moreover, DOE understands that 

condenser fan motor controllers 

function best when paired with a 

variable-speed modulating compressor, 

a technology that DOE understands to 

be only in the early stages of 

implementation in this industry. 

Therefore, DOE did not consider 

variable-speed condenser fan motors or 

condenser fan motor controllers as 

design options in its engineering 

analysis. 

g. Improved Transparent Door Designs 

In the NOPR, DOE modeled triple 

pane, low-e coated glass in the 

configuration of an advanced design 

option for vertical medium-temperature 

cases with transparent doors. Hussmann 

commented that low-e coatings have an 

inherent tint to them, which reduces the 

visibility of merchandise through a 

triple-paned, low-e coated glass door. 

(Hussmann, Public Meeting Transcript, 

No. 62 at p. 99) SAF, AHRI and NRA 

also expressed concern over product 

visibility associated with this 

technology. (SAF, No. 74 at p. 6) (AHRI, 

No. 75 at p. 6) (NRA, No. 90 at p. 5) 

Traulsen, NAFEM, Continental, Royal 

Vendors, and True noted that triplepane glass doors are much heavier than 

double-paned doors, and increase the 

risk of the unit tipping over, especially 

when it is near empty. Additionally, 

True pointed out that triple-paned glass 

led to reduced thermo-break in hinge 

areas, reduction in internal volume of 

sliding doors, failure to clear the 

Underwriters Laboratories (UL) 471 tiptest,31 door opening difficulties due to 

added mass and easier breakage. 

Traulsen also noted that an enhanced 

door would require design changes 

including heavier hinges, and a 

complete redesign of sliding doors with 

applications in narrow aisles. 

(Continental, No. 87 at p. 3) (NAFEM, 

No. 93 at p. 7) (True, No. 76 at p. 2) 

(Traulsen, No. 65 at p. 10) 

Additionally, AHRI commented that, 

for HCT equipment, the NOPR TSD 

considered two extra panes of glass for 

high-performance doors that were used 

in low and ice-cream temperatures, 

whereas only a single extra pane of glass 

was used for medium temperature highperformance doors. (AHRI, No. 75 at p. 

7) 

The CA IOUs disagreed with the 

comments from many manufacturers 

and trade associations, and in a written 

comment opined that triple-pane, low-e 

transparent doors were feasible in 

medium temperature applications and 

were already found in existing 


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equipment. (CA IOUs, No. 63 at p. 6) 

The Joint Comment suggested that if the 

use of triple-pane, low-e doors were to 

reduce product visibility, then increased 

lighting levels may be more energyefficient than reverting to double-pane 

glass. (Joint Comment, No. 91 at p. 4) 

DOE understands the concern of 

manufacturers and other interested 

parties regarding the applicability and 

appropriateness of triple-pane, low-e 

doors in medium temperature 

equipment. The range of concerns 

suggests that manufacturers may 

encounter significant issues of redesign, 

recertification, consumer choice, and 

possible loss of some functionality were 

this feature to be implemented across all 

medium-temperature glass-door units. 

Therefore, in its final rule modeling of 

glass doors, DOE restricted its highperformance design to consider only 

two panes of glass for mediumtemperature cases. 

In response to AHRI’s comments 

regarding HCT doors, DOE asserts that 

HCT doors as modeled in its 

engineering analysis for the NOPR 

featured the same number of panes of 

glass in both low/ice cream and medium 

temperature designs. For these 

equipment types, the baseline door 

featured a single pane of glass, while the 

high-performance door featured a 

second pane of glass. These designs are 

consistent with what DOE has observed 

on the market and in the design of 

similar equipment. Therefore, DOE 

retained these designs, with respect to 

the number of panes of glass modeled, 

in its final rule engineering analysis. 

DOE agrees with the CA IOUs that 

some equipment currently on the 

market for medium-temperature 

applications does feature triple-pane, 

low-e glass doors. However, this is not 

a standard design and DOE understands 

the concerns of manufacturers in 

applying this feature to the entirety of 

their product lines. Due to concerns 

over applicability and implementation 

of triple-pane, low-e doors in all 

medium-temperature products, DOE 

retained a double-pane design in its 

final rule engineering analysis 

simulation of improved glass door 

performance. However, DOE wishes to 

point out again that it is not setting 

prescriptive design requirements, and 

thus manufacturers are free to use only 

those designs and technologies they see 

fit in order to attain the level of 

performance specified in today’s final 

rule. 

h. High-Performance Coil Designs 

In order to model improved 

performance, DOE considered the use of 

improved evaporator and condenser 

coils as design options. However, many 

manufacturers felt that while these 

design options provided theoretical 

efficiency gain, there are several 

practical issues which mitigated these 

gains in the field. Heatcraft commented 

that the phrase ‘‘improved evaporator 

coil design’’ was a very generic term, 

and that coils that can be designed for 

high efficiency in a laboratory 

environment may not serve the purpose 

of the equipment functionally in the 

field. (Heatcraft, Public Meeting 

Transcript, No. 62 at p. 77) Danfoss, 

Traulsen, Southern Store Fixtures, 

Royal Vendors and True commented 

that higher fin density for evaporators 

and condensers would lead to frequent 

clogging and freezing, which could not 

only cause an increase in energy use, 

but also cause the unit to not maintain 

temperature levels required for safe 

storage of food. (Danfoss, No. 61 at p. 4) 

(Traulsen, No. 65 at p. 6) (Southern 

Store Fixtures, No. 67 at p. 3) (Royal, 

No. 68 at p. 1) (True, Public Meeting 

Transcript, No. 62 at p. 67) 

At the NOPR stage, DOE modeled an 

improved evaporator coil with a larger 

number of tube passes than the baseline 

design; however, Traulsen commented 

that if an evaporator with a larger 

number of tube passes is selected, there 

is an increased risk of refrigerant 

pressure drop through the coils. 

Traulsen further commented that, with 

multiple tubing circuits, this drop could 

be so substantial that the refrigerant 

could fail to make its way back to the 

compressor. (Traulsen, No. 65 at p. 6) 

DOE also modeled rifled evaporator 

tubes to improve coil performance in its 

NOPR analyses. Southern Store Fixtures 

commented that the use of rifled tubing 

for evaporator coils may have no 

significant improvement in coil 

performance for commercial 

refrigeration systems. (Southern Store 

Fixtures, No. 67 at p. 3) AHRI 

commented that rifling of evaporator 

coil tubes is common in the industry, 

but that in practical applications, lower 

evaporation temperatures and lower 

flow rates result in no significant 

efficiency improvement attributable to 

internally enhanced tubing. (AHRI, No. 

75 at p. 3) Continental commented that 

rifled tubing for evaporator coils causes 

turbulence in refrigerant flow, leading to 

slugging and stress concentrations, 

which lead to increased maintenance 

costs and failure possibilities. 

(Continental, No. 87 at p. 2) 

Another concern amongst 

manufacturers was the effect of 

incorporating larger evaporator and 

condenser coils into a unit. AHRI noted 

that there had been drastic reductions in 

the overall width and depth of the 

modeled evaporator coils since the last 

rulemaking. Further, AHRI noted that 

while DOE relied on its contractors for 

details on coil construction, it did not 

provide any references to studies that 

justify changes in coil dimensions. 

(AHRI, No. 75 at p. 5) Traulsen 

commented that larger coils would 

require equipment redesign, resulting in 

possible obsolescence of smaller lines 

and custom applications. (Traulsen, No. 

65 at p. 6) Hillphoenix commented that 

the use of taller coils would decrease 

the amount of product that could be put 

in the case, or would move the product 

further away from consumers, and that 

this would be unacceptable to retailers. 

(Hillphoenix, No. 71 at p. 4) Hussmann 

commented that increasing evaporator 

and condenser coil dimensions would 

involve engineering costs associated 

with redesigning parts of the case that 

interface with the coil. (Hussmann, No. 

77 at p. 2) Structural Concepts 

commented that changing the overall 

height of heat exchangers would require 

that either the display capacity to be 

reduced, or the overall height of a unit 

be increased, which would impact 

utility negatively. (Structural Concepts, 

No. 85 at p. 2) Continental commented 

that in under-counter and worktop 

units, limited space is available for a 

condensing unit, and increasing the size 

of the condenser coil is not practical. 

(Continental, No. 87 at p 2) 

In response to the comment from 

Heatcraft regarding DOE’s reference to 

‘‘improved evaporator coil design,’’ DOE 

points to chapter 5 of its TSD, where it 

specifically outlines the geometries and 

features included in this coil design. 

With respect to the concerns of 

Heatcraft, Danfoss, Traulsen, Southern 

Store Fixtures, Royal Vendors, and True 

that coil designs must remain functional 

in the field, DOE only considered 

features which were proven through 

field use in current coil designs. In a 

review of the coil designs at the final 

rule stage, DOE removed from 

consideration designs featuring 

increased fin pitch, and instead retained 

the modeled fin pitches at levels seen in 

teardown units. DOE believes that this 

action addresses the concerns of these 

stakeholders over the issues of clogging 

and freezing that could be encountered 

with higher-fin-pitch coils. 

When modeling coil configurations at 

baseline and improved levels of 

efficiency, DOE evaluated the overall 

performance of the coils within the 

context of specific refrigeration systems 

in which they would be used. This 

included numerical simulation of coil 

performance accounting for pressure 

drops. DOE excluded from 

consideration coil designs which proved 


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impractical, or which had negative 

energy impacts. Therefore, DOE believes 

Traulsen’s concern regarding pressure 

drops over larger numbers of tube 

passes to be unsubstantiated. 

Additionally, DOE re-evaluated its coil 

designs at the final rule stage based on 

stakeholder comments and additional 

data from teardowns, incorporating 

many of the concerns expressed in these 

comments during coil modeling at the 

final rule stage. 

Based on stakeholder comments 

including those of Southern Store 

Fixtures, AHRI, and Continental, DOE 

removed consideration of coil tube 

rifling from its analysis of improved 

heat exchanger performance at the final 

rule stage of this rulemaking. DOE 

believes that this action addresses the 

concerns voiced by stakeholders over 

the inapplicability of rifled tubing to 

some commercial refrigeration designs 

and issues with reduced refrigerant 

flow, slugging, and other negative 

effects. 

During the final rule stage, DOE 

revised its modeling of evaporator and 

condenser coils based on new 

information gained through stakeholder 

comments and additional teardowns. In 

this analysis, it addressed the concerns 

expressed by manufacturers and other 

parties regarding the size constraints 

imposed upon heat exchangers in 

commercial refrigeration applications. 

With respect to the comments from 

AHRI, DOE notes that it did re-evaluate 

its coil designs from the 2009 

rulemaking to produce designs that 

better approximate the configurations 

and performance attributes of coils 

found in the market. In response to the 

concerns of Hillphoenix, Hussmann, 

Structural Concepts, and Continental, 

during its final rule engineering 

modeling, DOE kept the size of modeled 

evaporator coils constant based on 

geometries seen in teardown units, and 

instead modified only features which 

could improve coil performance without 

growing the footprint of the coil. When 

modeling condenser coils, DOE allowed 

for a modest inclusion of an additional 

coil row in the direction of airflow. This 

was consistent with advanced designs 

seen in production units today, and 

DOE believes that this added coil size 

would not be sufficient to cause major 

impacts on unit form factor. 

i. Higher-Efficiency Fan Blades 

Traulsen commented that DOE 

modeling of higher efficiency fan blades 

did include specific details pertaining to 

the implementation of this design 

option, including energy savings, 

method of cost modeling, and other 

attributes. (Traulsen, No. 65 at p. 5) 

ebm-papst commented that fan selection 

should be based on airflow at the 

operating point and should not be 

limited to axial and tangential fans. 

(ebm-papst, No. 70 at p. 3) 

In response to Traulsen’s comment, 

DOE wishes to clarify that DOE did not 

consider higher-efficiency fan blades as 

a design option within its NOPR or final 

rule engineering analyses. Most 

commercial refrigeration equipment 

currently uses stamped sheet metal or 

plastic axial fan blades. DOE was not 

able to identify any axial fan blade 

technology that is significantly more 

efficient than what is currently used, 

but did identify tangential fan blades as 

an alternative fan blade technology that 

might improve efficiency. However, 

tangential fan blades in small sizes are 

themselves less efficient at moving air, 

and thus require greater motor shaft 

power. Because of these competing 

effects, DOE did not consider tangential 

fan blades as a design option in its 

analyses. Additionally, with regard to 

ebm-papst’s comment, DOE did not 

encounter any other fan blade 

technologies aside from axial and 

tangential fans which were available for 

application in commercial refrigeration 

equipment. Consistent with the 

comment from ebm-papst, DOE 

modeled fan motor and blade 

combinations so as to provide needed 

airflow across the heat exchangers 

consistent with what is used in designs 

currently available on the market. 

j. ECM Fan Motors 

ebm-papst, in its written comment, 

noted that a variety of fans with 

electronically commutated (EC) motors 

(ECMs) were available on the market 

which provided wire-to-air efficiency of 

65–70%. ebm-papst further commented 

that EC motors are compact and easily 

integrated into all levels of refrigeration 

systems. Also, ebm-papst commented 

that EC fans compatible with alternative 

refrigerants are now available on the 

market. (ebm-papst, No. 70 at p. 4) 

DOE agrees with ebm-papst regarding 

the performance and availability of ECM 

fan motors for commercial refrigeration 

applications. In its preliminary and 

NOPR analyses, DOE considered EC 

motors as a design option for evaporator 

and condenser fan applications in all 

equipment classes where such fans were 

present. Additionally, DOE modeled an 

overall efficiency of 66% for EC motors, 

which is consistent with the figure 

provided by ebm-papst. DOE retained 

this modeling of EC motors in the final 

rule analyses. 

k. Lighting Occupancy Sensors and 

Controls 

In its analysis, DOE considered 

lighting occupancy sensors as a design 

option with the potential to reduce unit 

energy consumption. However, Traulsen 

commented that the study of occupancy 

sensors which DOE cited did not 

account for different traffic patterns, and 

only covered 30 days of data collection 

with LEDs at full power and 60 days 

with LEDs dimmed. Traulsen expressed 

concern that this analysis used 

insufficient data to support the savings 

assumed by TSL4. (Traulsen, No. 65 at 

p. 12) Hillphoenix commented that the 

occupancy sensor credit for VOP.RC.L 

was higher than for all other classes. 

(Hillphoenix, No. 71 at p. 7) 

Some manufacturers questioned the 

need for occupancy sensors. AHRI 

commented that since manual night 

curtains are modeled, it could be 

assumed that when the curtains are 

deployed, the CRE lighting systems can 

also be manually turned off during 

periods of inactivity. (AHRI, No. 75 at 

p. 4) Structural Concepts commented 

that requiring occupancy sensors on 

cases that will be going to twenty-four 

hour stores would be a cost-burden with 

no associated energy savings. (Structural 

Concepts, No. 85 at p. 2) However, the 

Joint Comment suggested that the use of 

lighting sensors could further reduce the 

energy consumption of max-tech 

options for self-contained vertical 

closed transparent door units. (Joint 

Comment, No. 91 at p. 4) 

DOE based its modeling of lighting 

occupancy sensors and scheduled 

controls on the provisions of the DOE 

test procedure as amended by the 2012 

final rule. 77 FR at 10292 (February 21, 

2012). These provisions allow for cases 

featuring these technologies to be tested 

with the lights turned off for a fixed 

period of time. DOE applied these 

provisions specifically across all classes 

in which occupancy sensors and 

scheduled controls were considered as a 

design option. Therefore, DOE believes 

Traulsen’s assertions regarding DOE’s 

modeled savings levels to be incorrect, 

as DOE did not model savings potential 

based on field studies, but rather on the 

specific provisions of the DOE test 

procedure. In response to the comment 

from Hillphoenix, DOE wishes to clarify 

that occupancy sensors were not given 

an absolute credit in the form of a kWh/ 

day reduction, but instead were 

modeled as they are treated under the 

DOE test procedure, where they are 

given an allowance for lighting off time. 

This modified lighting run time was 

incorporated into DOE’s engineering 

analysis model for cases including 


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32The Montreal Protocol is an international 

agreement, first signed in 1987, in which signatories 

pledged to phase out the production and use of 

ozone depleting substances. 

lighting occupancy sensors, and the 

model was run for the particular case 

configuration being examined. 

Therefore, due to differences in case 

geometries, features, and design options, 

DOE cautions against direct 

comparisons of the absolute merits of 

specific technologies across different 

equipment classes, as such comparisons 

may be misleading. 

With respect to the comment from 

AHRI, DOE does not consider a manual 

light switch to be a lighting controller 

under the provisions of its test 

procedure, since this device does not 

have the inherent ability to reduce 

energy consumption and since the 

method of test included in the 

procedure requires that all lighting be 

activated during the test. In its 2012 test 

procedure final rule, DOE added a 

provision specifically to allow for the 

testing of units including occupancy 

sensors and scheduled controls, but this 

does not include manual light switches. 

77 FR at 10292 (February 21, 2012). 

Therefore, DOE maintains that a manual 

light switch is not a lighting control and 

shall not be treated as such during the 

conduct of the DOE test procedure. 

In response to the concerns of 

Structural Concepts, occupancy sensors 

have the potential to operate at all 

times, turning off lighting to save energy 

during periods of inactivity, then 

reactivating the lights when shoppers 

are present. DOE understands that, even 

in 24-hour stores, there are periods 

when a high density of shoppers may 

not be present, and thus when lighting 

occupancy sensors would present the 

potential to save energy. DOE agrees 

with the Joint Comment that lighting 

occupancy sensors offer the potential to 

reduce the energy consumption of 

equipment in classes to which they are 

applicable, including the particular 

class noted in the comment. Therefore, 

DOE retained its modeling of this design 

option in its final rule engineering 

analysis. 

l. Night Curtains 

DOE analyzed night curtains as a 

design option with the potential to 

reduce equipment energy consumption. 

However, Southern Store Fixtures 

commented that, while DOE modeled a 

reduction in heat load when night 

curtains were employed, there was no 

cost analysis presented to justify this 

option. Furthermore, Southern Store 

Fixtures referred to a Pacific Gas and 

Electric Company (PG&E) report which 

asserted that night curtains were not 

cost effective due to poor economics, 

and a study funded by the California 

Energy Commission which reported a 

minimum 6.63 year and maximum 

21.56 year payback period on night 

curtains. (Southern Store Fixtures, No. 

67 at p. 6) Structural Concepts 

commented that night curtains should 

be excluded from the analysis since they 

were deemed by DOE as not ‘‘required.’’ 

Structural Concepts further commented 

that twenty-four-hour stores would not 

be able to use night curtains. (Structural 

Concepts, No. 85 at p. 2) 

Regarding the types of night curtains 

that were modeled by DOE, AHRI 

commented that DOE did not explore 

automatic night curtains and Southern 

Store Fixtures commented that there 

were no night curtains currently 

available that are suited for curved 

display cases. (Southern Store Fixtures, 

No. 67 at p. 5) (AHRI, No. 75 at p. 3) 

In response to the comment from 

Southern Store Fixtures on cost 

analysis, DOE wishes to clarify that it 

did include a cost analysis of night 

curtains in its engineering analysis. 

Costs per foot of night curtain were 

included in DOE’s engineering 

spreadsheet model as released to the 

public, and served as the basis of DOE’s 

placement of night curtains in the 

engineering cost-efficiency curves, as 

design options were ordered from 

lowest to highest calculated payback 

period. Regarding the mention of the 

PG&E report as presented to CEC, DOE 

understands that that report focused 

largely on time-variant economic factors 

such as the savings at peak-load 

conditions, rather than the overall life 

cycle cost savings and payback periods 

calculated by DOE. Therefore, due to a 

different focus and methodology, that 

organization may have reached a 

different conclusion than that attained 

by DOE. DOE plans to retain its 

analytical methodology as used across a 

variety of rulemaking efforts and 

believes that that methodology is 

appropriate and soundly evaluates the 

economic and energy savings benefits of 

design options including night curtains. 

With respect to the comments from 

Structural Concepts, DOE agrees that 

use of night curtains is not required 

since DOE is setting a performance 

standard based on daily energy 

consumption under the DOE test 

procedure, rather than a prescriptive 

standard mandating the use of specific 

features. However, DOE is charged with 

exploring all avenues of reducing 

measured energy consumption, and the 

ability of the DOE test procedure to 

quantify savings attributed to night 

curtains justifies DOE’s inclusion of this 

technology in its analysis. In addition, 

DOE notes that night curtains may be 

used in 24-hour stores during periods of 

low customer traffic, and that 

consideration of this feature in 

equipment offered for sale would 

provide store operators with the 

availability of an additional mechanism 

for attaining energy savings. 

DOE agrees with AHRI that it did not 

explore automatic night curtains, as it 

did not find a readily available 

automatic night curtain technology that 

was applicable to the relevant case 

designs, including vertical and 

semivertical open cases. With respect to 

the comment from Southern Store 

Fixtures on case geometries, DOE 

believes that night curtains are available 

that apply to the vast majority of open 

case designs. Further, DOE is not setting 

a prescriptive standard; night curtains 

are one design option, but not required 

under the amended standard. 

3. Refrigerants 

For the preliminary and NOPR 

analyses, DOE considered two 

refrigerants, hydrofluorocarbons (HFCs) 

R–134a and R–404a, because these are 

the industry-standard choices for use in 

the vast majority of commercial 

refrigeration equipment covered by this 

rulemaking. This selection was 

consistent with the modeling performed 

in the January 2009 final rule, which 

was based on industry research and 

stakeholder feedback at that time. After 

the publication of the NOPR, DOE 

received a number of comments on 

potential future issues relating to 

refrigerants for this equipment. 

ACEEE commented that the DOE had 

not taken into consideration the use of 

propane and other hydrocarbon 

refrigerants, which are in use 

internationally and are now allowed in 

limited quantities by the U.S. 

Environmental Protection Agency 

(EPA). ACEEE further commented that it 

has manufacturer statements to show 

that these refrigerants considerably 

improve equipment efficiency. (ACEEE, 

Public Meeting Transcript, No. 62 at p. 

40) Danfoss commented that Montreal 

Protocol 32 amendments requiring the 

phasing out of HFCs would likely come 

into effect before this standard’s 

compliance date. Additionally, Danfoss 

commented that this action would make 

DOE’s ‘‘refrigerant neutral’’ stance 

flawed, and that DOE must consider the 

increased uncertainty and regulatory 

burden from the use of low-global 

warming potential (GWP) refrigerants in 

its analysis. (Danfoss, No. 61 at p. 2) 

Coca-Cola, too, opined that by not 

directly analyzing alternative 

refrigerants, DOE was showing a bias 


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33EPA SNAP is the U.S. government regulatory 

program responsible for maintaining the list of 

alternatives to ozone depleting substances allowed 

for use within specific applications, including 

refrigeration, in the United States. 

towards HFCs. (Coca-Cola, Public 

Meeting Transcript, No. 62 at p. 121) 

The CA IOUs commented that 

alternative refrigerants are being used 

both internationally and in the United 

States. The CA IOUs further commented 

that, given the potential for EPA 

regulations on HFC usage, DOE should 

be prepared to adopt the levels of 

performance included in its proposed 

standards to reflect the performance 

abilities of other refrigerants. (CA IOUs, 

No. 63 at p. 8) 

AHRI commented that the potential 

for changes in Federal refrigerant policy 

over the next few years will require the 

industry to use refrigerants with low 

GWP, putting into question the 

applicability of the proposed standard 

over extended time periods. AHRI 

further stated that there was a 

possibility of refrigerant switching 

having adverse impacts on equipment 

performance. (AHRI, No. 75 at p. 10) 

True commented that the refrigerants 

modeled in the analysis, R404 and 

R134a, are both currently being 

reviewed by the EPA Significant New 

Alternatives Policy (SNAP) program 33

for possible removal from commercial 

refrigeration applications. (True, Public 

Meeting Transcript, No. 62 at p. 123) 

Lennox, too, noted that non-HFC 

refrigerants might become a growing 

part of the CRE market in the 

foreseeable future. (Lennox, No. 73 at p. 

5) Additionally, Hillphoenix 

commented that manufacturers are 

being pushed towards low GWP 

refrigerants which will have an impact 

on coil and evaporator designs, as well 

as efficiency curves for compressors. 

(Hillphoenix, No. 71 at p. 2) 

ACEEE asserted that the market 

already has begun to move away from 

HFC refrigerants. (ACEEE, Public 

Meeting Transcript, No. 62 at p. 185) 

Coca-Cola commented that it was 

seeking to stop using HFCs and switch 

over to R744, R290 and R600A, not only 

to improve energy efficiency, but also to 

make the units environmentally benign. 

(Coca-Cola, Public Meeting Transcript, 

No. 62 at p. 88) Further, Coca-Cola 

commented that it is already purchasing 

a large number (28% in the United 

States) of R744 cabinets, and aim to be 

using only R744 within three years. 

(Coca-Cola, Public Meeting Transcript, 

No. 62 at p. 128) Continental 

commented that refrigerants such as 

propane and CO2 have been approved 

by EPA and are actively being evaluated 

and tested in products. Continental 

further commented that alternative 

refrigerants have the potential to affect 

the performance of equipment. 

(Continental, No. 87 at p. 1) AHRI also 

commented that a change in refrigerant 

policy would impact refrigerants which 

are used as blowing agents for foams, 

possibly resulting in lower insulation 

performance values. (AHRI, No. 75 at p. 

10) Providing an additional view, the 

Joint Comment noted that the use of 

propane as a refrigerant could improve 

efficiency of units by 7–11%. 

Additionally, the Joint Comment 

pointed out that while DOE did not 

model non-HFC refrigerants, 

manufacturers have the option of using 

more efficient refrigerants. (Joint 

Comment, No. 91 at p. 4) 

Specifically, many stakeholders 

wished for DOE to consider propane 

(R290) as a viable alternative refrigerant. 

Danfoss commented that the inclusion 

of natural refrigerants in the analysis 

was a critical issue, since, unlike higherefficiency compressors, the technology 

is already available. Danfoss urged DOE 

to consider propane, isobutane and 

carbon dioxide as viable refrigerants. 

(Danfoss, Public Meeting Transcript, No. 

62 at p. 126) ACEEE commented that 

DOE’s decision to screen out propane 

refrigerant as a design option had 

seriously impacted the downstream 

analyses. (ACEEE, Public Meeting 

Transcript, No. 62 at p. 127) However, 

both Structural Concepts and True 

noted that they could consider propane 

as a refrigerant for some, but not all, of 

their products, since the 150 gram 

SNAP limit restricted total compressor 

capacity. (Structural Concepts, Public 

Meeting Transcript, No. 62 at p. 127) 

(True, Public Meeting Transcript, No. 62 

at p. 127) 

In its written comment, however, 

Traulsen commented that, while 

alternative refrigerants were discussed 

in the public meeting, DOE should 

remain technology neutral with regard 

to those refrigerants at this time, since 

there was a risk of conflict with other 

programs such as EPA SNAP and UL, 

and since the costs to switch over to 

alternative refrigerants is high. 

(Traulsen, No. 65 at p. 18) 

While DOE appreciates the input from 

stakeholders at the public meeting and 

in subsequent written comment, DOE 

does not believe that there is sufficient 

specific, actionable data presented at 

this juncture to warrant a change in its 

analysis and assumptions regarding the 

refrigerants used in commercial 

refrigeration applications. As of now, 

there is inadequate publicly-available 

data on the design, construction, and 

operation of equipment featuring 

alternative refrigerants to facilitate the 

level of analysis of equipment 

performance which would be needed for 

standard-setting purposes. DOE is aware 

that many low-GWP refrigerants are 

being introduced to the market, and 

wishes to ensure that this rule is 

consistent with the phase-down of HFCs 

proposed by the United States under the 

Montreal Protocol. DOE continues to 

welcome comments on experience 

within the industry with the use of lowGWP alternative refrigerants. Moreover, 

there are currently no mandatory 

initiatives such as refrigerant phase-outs 

driving a change to alternative 

refrigerants. Absent such action, DOE 

will continue to analyze the most 

commonly-used, industry-standard 

refrigerants in its analysis. 

DOE wishes to clarify that it will 

continue to consider CRE models 

meeting the definition of commercial 

refrigeration equipment to be part of 

their applicable covered equipment 

class, regardless of the refrigerant that 

the equipment uses. If a manufacturer 

believes that its design is subjected to 

undue hardship by regulations, the 

manufacturer may petition DOE’s Office 

of Hearing and Appeals (OHA) for 

exception relief or exemption from the 

standard pursuant to OHA’s authority 

under section 504 of the DOE 

Organization Act (42 U.S.C. 7194), as 

implemented at subpart B of 10 CFR 

part 1003. OHA has the authority to 

grant such relief on a case-by-case basis 

if it determines that a manufacturer has 

demonstrated that meeting the standard 

would cause hardship, inequity, or 

unfair distribution of burdens. 

4. Cost Assessment Methodology 

During the preliminary analysis, DOE 

developed costs for the core case 

structure of the representative units it 

modeled, based on cost estimates 

performed in the analysis for the 

January 2009 final rule. For more 

information, see chapter 5 of the 

preliminary analysis TSD, pp. 5–3 to 5– 

8. DOE also developed costs for the 

design option levels implemented, 

based on publicly available information 

and price quotes provided during 

manufacturer interviews. These costs 

were combined in the engineering cost 

model based on the specifications of a 

given modeled unit in order to yield 

manufacturer production cost (MPC) 

estimates for each representative unit at 

each configuration modeled. At the 

preliminary analysis rulemaking stage, 

DOE’s component cost estimates were 

based on data developed from 

manufacturer interviews, estimates from 

the January 2009 final rule, and publicly 

available cost information. During the 

NOPR analysis, DOE augmented this 


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34The reason why no HZO units were torn down 

was that the HZO family is the least complex of the 

equipment classes with respect to its construction. 

DOE felt that there was no additional data which 

could be gained from teardown of this equipment 

which would not have already been captured by the 

teardowns of other units. 

information with data from physical 

teardowns of commercial refrigeration 

equipment currently on the market. 

During the development of the 

engineering analysis for the NOPR, DOE 

interviewed manufacturers to gain 

insight into the commercial refrigeration 

industry, and to request feedback on the 

engineering analysis methodology, data, 

and assumptions that DOE used. Based 

on the information gathered from these 

interviews, along with the information 

obtained through a teardown analysis 

and public comments, DOE refined the 

engineering cost model. Next, DOE 

derived manufacturer markups using 

publicly available commercial 

refrigeration industry financial data, in 

conjunction with manufacturer 

feedback. The markups were used to 

convert the MPCs into MSPs. These 

results were used as the basis for the 

downstream calculations at the NOPR 

stage of the rulemaking. 

At the NOPR public meeting and in 

subsequent written comments, DOE 

received further input from stakeholders 

regarding the methodologies and inputs 

used in DOE’s cost assessment. DOE 

incorporated this input in updating its 

modeling at the final rule stage. Further 

discussion of the comments received 

and the analytical methodology used is 

presented in the following subsections. 

For additional detail, see chapter 5 of 

the final rule TSD. 

a. Teardown Analysis 

In the preliminary analysis TSD, DOE 

expressed its intent to update its core 

case cost estimates, which were at that 

time developed based on estimates from 

the January 2009 final rule, through 

performing physical teardowns of 

selected units. These core case costs 

consist of the costs to manufacture the 

structural members, insulation, 

shelving, wiring, etc., but not the costs 

associated with the components that 

could directly affect energy 

consumption, which were considered 

collectively as design options and 

served as one of many inputs to the 

engineering cost model. DOE first 

selected representative units for 

physical teardown based on available 

offerings from the catalogs of major 

manufacturers. DOE selected units that 

had sizes and feature sets similar to 

those of the representative units 

modeled in the engineering analytical 

model. DOE selected units for teardown 

representing each of the equipment 

families, with the exception of the HZO 

family.34 The units were then 

disassembled into their base 

components, and DOE estimated the 

materials, processes, and labor required 

for the manufacture of each individual 

component. This process is referred to 

as a ‘‘physical teardown.’’ Using the 

data gathered from the physical 

teardowns, DOE characterized each 

component according to its weight, 

dimensions, material, quantity, and the 

manufacturing processes used to 

fabricate and assemble it. These 

component data were then entered into 

a spreadsheet and organized by system 

and subsystem levels to produce a 

comprehensive bill of materials (BOM) 

for each unit analyzed through the 

physical teardown process. 

The physical teardowns allowed DOE 

to identify the technologies, designs, 

and manufacturing techniques that 

manufacturers incorporated into the 

equipment that DOE analyzed. The 

result of each teardown was a structured 

BOM, incorporating all materials, 

components, and fasteners, classified as 

either raw materials or purchased parts 

and assemblies, and characterizing the 

materials and components by weight, 

manufacturing processes used, 

dimensions, material, and quantity. The 

BOMs from the teardown analysis were 

then modified, and the results used as 

one of the inputs to the cost model to 

calculate the MPC for each 

representative unit modeled. The MPCs 

resulting from the teardowns were then 

used to develop an industry average 

MPC for each equipment class analyzed. 

At the final rule stage of the 

rulemaking, in response to comments 

regarding the technologies incorporated 

into commercial refrigeration equipment 

at various levels of performance, DOE 

procured additional models of 

equipment on the market and performed 

further teardown assessment of the 

construction and componentry featured 

in these models. The data from these 

supplemental teardowns, coupled with 

known performance of the purchased 

units from independent testing or 

ENERGY STAR certification, allowed 

DOE to compare the performance of 

models currently on the market to the 

results of modeling of the same 

equipment configurations using its 

engineering simulation. This 

comparison provided a validation check 

on the results of the simulations. See 

chapter 5 of the final rule TSD for more 

details on the teardown analysis. 

b. Cost Model 

The cost model for this rulemaking 

was divided into two parts. The first of 

these was a standalone core case cost 

model, based on physical teardowns, 

that was used for developing the core 

case costs for the 25 directly analyzed 

equipment classes. This cost model is a 

spreadsheet that converts the materials 

and components in the BOMs from the 

teardowns units into MPC dollar values 

based on the price of materials, average 

labor rates associated with 

manufacturing and assembling, and the 

cost of overhead and depreciation, as 

determined based on manufacturer 

interviews and DOE expertise. To 

convert the information in the BOMs to 

dollar values, DOE collected 

information on labor rates, tooling costs, 

raw material prices, and other factors. 

For purchased parts, the cost model 

estimates the purchase price based on 

volume-variable price quotations and 

detailed discussions with manufacturers 

and component suppliers. For fabricated 

parts, the prices of raw metal materials 

(e.g., tube, sheet metal) are estimated 

based on 5-year averages calculated 

from cost estimates obtained from 

sources including the American Metal 

Market and manufacturer interviews. 

The cost of transforming the 

intermediate materials into finished 

parts is estimated based on current 

industry pricing. 

The function of the cost model 

described above is solely to convert the 

results of the physical teardown 

analysis into core case costs. To achieve 

this, components immaterial to the core 

case cost (lighting, compressors, fans, 

etc.) were removed from the BOMs, 

leaving the cost model to generate 

values for the core case costs for each of 

the teardown points. Then, these 

teardown-based core case BOMs were 

used to develop a ‘‘parameterized’’ 

computational cost model, which allows 

a user to virtually manipulate case 

parameters such as height, length, 

insulation thickness, and number of 

doors by inputting different numerical 

values for these features to produce new 

cost estimates. For example, a user 

could start with the teardown data for 

a two-door case and expand the model 

of the case computationally to produce 

a cost estimate for a three-door case by 

changing the parameter representing the 

number of doors, which would in turn 

cause the model to scale other geometric 

and cost parameters defining the overall 

size of the case. This parameterized 

model, coupled with the design 

specifications chosen for each 

representative unit modeled in the 

engineering analysis, was used to 


tkelley on DSK3SPTVN1PROD with RULES2
17756 Federal Register / Vol. 79, No. 60 / Friday, March 28, 2014 / Rules and Regulations 

35The DOE Solid-State Lighting Program is a 

program within DOE’s Office of Energy Efficiency 

& Renewable Energy. More information on the 

program is available at http://

www1.eere.energy.gov/buildings/ssl/. 

develop core case MPC cost estimates 

for each of the 25 directly analyzed 

representative units. These values 

served as one of several inputs to the 

engineering cost model. 

The engineering analytical model, as 

implemented by DOE in a Microsoft 

Excel spreadsheet, also incorporated the 

engineering cost model, the second cost 

modeling tool used in this analysis. In 

the engineering cost model, core case 

costs developed based on physical 

teardowns were one input, and costs of 

the additional components required for 

a complete piece of equipment (those 

components treated as design options) 

were another input. The two inputs 

were added together to arrive at an 

overall MPC value for each equipment 

class. Based on the configuration of the 

system at a given design option level, 

the appropriate design option costs were 

added to the core case cost to reflect the 

cost of the entire system. Costs for 

design options were calculated based on 

price quotes from publicly available 

sources and discussions with 

commercial refrigeration equipment 

manufacturers. Chapter 5 of the final 

rule TSD describes DOE’s cost model 

and definitions, assumptions, data 

sources, and estimates. 

c. Manufacturer Production Cost 

Once the cost estimates for all the 

components of each representative unit, 

including the core case cost and design 

option costs, were finalized, DOE 

totaled the costs in the engineering cost 

model to calculate the MPC. DOE 

estimated the MPC at each efficiency 

level considered for each directly 

analyzed equipment class, from the 

baseline through the max-tech. After 

incorporating all of the assumptions 

into the cost model, DOE calculated the 

percentages attributable to each element 

of total production cost (i.e., materials, 

labor, depreciation, and overhead). DOE 

used these production cost percentages 

in the MIA (see section IV.J). At the 

NOPR stage of the rulemaking, DOE 

revised the cost model assumptions 

used for the preliminary analysis based 

on teardown analysis, updated pricing, 

and additional manufacturer feedback, 

which resulted in refined MPCs and 

production cost percentages. DOE once 

again updated the analysis at the final 

rule stage based on input from the 

NOPR public meeting and subsequent 

written comments. DOE calculated the 

average equipment cost percentages by 

equipment class. Chapter 5 of the TSD 

presents DOE’s estimates of the MPCs 

for this rulemaking, along with the 

different percentages attributable to 

each element of the production costs 

that comprise the total MPC. 

d. Cost-Efficiency Relationship 

The result of the engineering analysis 

is a cost-efficiency relationship. DOE 

created a separate relationship for each 

input capacity associated with each 

commercial refrigeration equipment 

class examined for this rule. DOE also 

created 25 cost-efficiency curves, 

representing the cost-efficiency 

relationship for each commercial 

refrigeration equipment class. 

To develop cost-efficiency 

relationships for commercial 

refrigeration equipment, DOE examined 

the cost differential to move from one 

design option to the next for 

manufacturers. DOE used the results of 

teardowns to develop core case costs for 

the equipment classes modeled, and 

added those results to costs for design 

options developed from publicly 

available pricing information and 

manufacturer interviews. Additional 

details on how DOE developed the costefficiency relationships and related 

results are available in the chapter 5 of 

the final rule TSD. Chapter 5 of the final 

rule TSD also presents these costefficiency curves in the form of energy 

efficiency versus MPC. After the 

publication of the NOPR analysis, 

several stakeholders provided input and 

feedback regarding DOE’s cost modeling 

methodology and costs used for specific 

components and design options. 

Specifically, DOE received comments 

regarding core case costs, LED cost 

specifications, component sourcing and 

cost information, and coil costs. The 

following sections address these 

stakeholder comments and concerns. 

Core Case Costs 

Traulsen commented that DOE’s 

assumption of core costs not changing 

for more efficient design option levels is 

flawed. Traulsen further pointed out 

that costs for shelving, wiring, air 

curtain grills, trim, etc. do change in all 

cases when internal or external product 

footprint is altered. (Traulsen, No. 65 at 

p. 15) 

DOE understands that changes to 

design requiring adjustment to a unit’s 

form factor would have an impact on 

the cost of production of the unit, and 

would result in the manufacturer 

incurring redesign costs. Of the design 

options considered, most would not 

have a significant impact in these areas, 

as they consist largely of component 

swaps or bolt-on component additions. 

However, for the design options which 

would affect unit format, DOE 

considered incremental materials costs 

and redesign costs, as well as capital 

expenditures, in its engineering and 

MIA analyses. Therefore, DOE believes 

that it has sufficiently addressed the 

concerns raised by Traulsen. 

Light-Emitting Diode Cost 

Specifications 

Several stakeholders expressed 

reservations over DOE’s use of LED 

price projections, opining that DOE had 

likely underestimated the price of LEDs. 

Traulsen commented that according to 

DOE’s Solid State Lighting Multi-Year 

Program Plan (MYPP), there is a 

breakthrough in LED performance 

required in 2015 that would decrease 

the life-cycle energy of LED lamps. 

Traulsen asserted that these projections 

were based on the assumption of 

continued governmental R&D support, 

and that there is evidence of declining 

R&D support for LEDs. Traulsen further 

commented that this lack of certainty 

made some assumptions in DOE 

analysis questionable. (Traulsen, No. 65 

at p. 3) Hussmann noted that, typically, 

LED fixtures cost twice as much as T8 

fluorescent ballasts. (Hussmann, No. 77 

at p. 2) Structural Concepts commented 

that the prices of LED fixtures would 

likely be 37–40% higher than DOE 

predictions for 2017. (Structural 

Concepts, No. 85 at p. 2) Similarly, 

Hillphoenix commented that DOE had 

modeled a zero cost for drivers and that 

current LED prices are on the order of 

three times that estimated in the model. 

(Hillphoenix, No. 71 at p. 1) Traulsen 

noted that for VCT.SC systems, the 

added cost of using LED systems was 

greater than $120 per unit. (Traulsen, 

No. 65 at p. 3) True commented that it 

was unlikely for LED prices to continue 

to drop. (True, No. 76 at p. 1) 

Hillphoenix commented that LED 

lighting for the VCT.RC.M and 

VCT.RC.L classes had experienced an 

83% reduction in cost from the previous 

rulemaking to the current rulemaking 

analysis. (Hillphoenix, No. 71 at p. 7) 

Conversely, the Joint Comment 

concurred with DOE’s analysis, noting 

that the incorporation of LED price 

projections significantly improved the 

analysis by reflecting a realistic estimate 

of LED costs. (Joint Comment, No. 91 at 

p. 5) 

In its NOPR analysis, DOE 

incorporated price projections from its 

Solid-State Lighting Program 35 into its 

MPC values for the primary equipment 

classes. The price projections for LED 

case lighting were developed from 

projections developed for the DOE 

Solid-State Lighting Program 2012 

report, Energy Savings Potential of 


tkelley on DSK3SPTVN1PROD with RULES2
Federal Register / Vol. 79, No. 60 / Friday, March 28, 2014 / Rules and Regulations 17757 

36Navigant Consulting, Inc., Energy Savings 

Potential for Solid-State Lighting in General 

Illumination Applications. 2012. Prepared for the 

U.S. Department of Energy—Office of Energy 

Efficiency and Renewable Energy Building 

Technologies Office, Washington, DC. 

37 Discussion related to lighting maintenance 

costs for commercial refrigeration equipment can be 

found in section 0, and a more detailed explanation 

can be found in chapter 8 of the final rule TSD. 

Solid-State Lighting in General 

Illumination Applications (‘‘the energy 

savings report’’).36 In the appendix to 

this report, price projections from 2010 

to 2030 were provided in ($/klm) for 

LED lamps and LED luminaires. DOE 

analyzed the models used in the SolidState Lighting Program work and 

determined that the LED luminaire 

projection would serve as an 

appropriate proxy for a cost projection 

to apply to refrigerated case LEDs. The 

price projections presented in the SolidState Lighting Program’s energy savings 

report are based on the DOE’s 2011 

Multi-Year Program Plan (MYPP). The 

MYPP is developed based on input from 

manufacturers, researchers, and other 

industry experts. Table IV.1 shows the 

normalized LED price deflators used in 

the final rule analysis. 

TABLE IV.1—LED PRICE DEFLATORS USED IN THE FINAL RULE ANALYSIS

Year Normalized to 

2013 

Normalized to 

2017 Year Normalized to 2013 

Normalized to 

2017 

2010 .................................................. 2.998 5.652 2021 ................................................. 0.361 0.681 

2011 .................................................. 1.799 3.392 2022 ................................................. 0.335 0.631 

2012 .................................................. 1.285 2.423 2023 ................................................. 0.312 0.588 

2013 .................................................. 1.000 1.885 2024 ................................................. 0.292 0.550 

2014 .................................................. 0.819 1.543 2025 ................................................. 0.274 0.517 

2015 .................................................. 0.693 1.306 2026 ................................................. 0.259 0.488 

2016 .................................................. 0.601 1.133 2027 ................................................. 0.245 0.462 

2017 .................................................. 0.530 1.000 2028 ................................................. 0.232 0.438 

2018 .................................................. 0.475 0.895 2029 ................................................. 0.221 0.417 

2019 .................................................. 0.430 0.810 2030 ................................................. 0.211 0.398 

2020 .................................................. 0.393 0.740 * 2031–2046 ..................................... 0.211 0.398 

During the NOPR stage, DOE 

incorporated the price projection trends 

from the energy savings report into its 

engineering analysis by using the data to 

develop a curve of decreasing LED 

prices normalized to a base year. That 

base year corresponded to the year 

when LED price data was collected for 

the NOPR analyses of this rulemaking 

from catalogs, manufacturer interviews, 

and other sources. DOE started with this 

commercial refrigeration equipmentspecific LED cost data and then applied 

the anticipated trend from the energy 

savings report to forecast the projected 

cost of LED fixtures for commercial 

refrigeration equipment at the time of 

required compliance with the proposed 

rule (2017). These 2017 cost figures 

were incorporated into the engineering 

analysis as comprising the LED cost 

portions of the MPCs for the primary 

equipment classes. 

The LCC analysis (section IV.F) was 

carried out with the engineering 

numbers that account for the 2017 

prices of LED luminaires. The reduction 

in price of LED luminaires from 2018 

through 2030 was taken into account in 

the NIA (section IV.H). The cost 

reductions were calculated for each year 

from 2018 through 2030 and subtracted 

from the equipment costs in the NIA. 

The reduction in lighting maintenance 

costs 37 due to reduction in LED prices 

for equipment installed in 2018 to 2030 

were also calculated and appropriately 

deducted from the lighting maintenance 

costs. 

While DOE understands the concerns 

of manufacturers over projections of 

LED prices in the future, DOE made the 

decision to incorporate these projections 

based on stakeholder input, past market 

trends, and DOE research within the 

lighting field, which includes regular 

interaction with manufacturers and 

suppliers of LED lighting technologies. 

With respect to the comments from 

Traulsen, DOE does not see any specific 

hurdles in the market that indicate that 

levels predicted in the MYPP will fail to 

be realized. DOE appreciates the 

comments from Hussmann, Structural 

Concepts, Hillphoenix, Traulsen, and 

True regarding present and future LED 

prices. However, based on past market 

trends and the current research 

supporting the MYPP, DOE continued to 

utilize these LED price projections in 

the modeling underlying today’s final 

rule. As a point of clarification to the 

comment presented by Hillphoenix, 

DOE wishes to mention that the 

modeled costs include all components 

of the LED fixture, including drivers, 

emitters, housing, and wiring. DOE 

agrees with the assertion of the Joint 

Comment that incorporation of LED 

price projections allow the analysis to 

better depict market conditions which 

will be encountered by manufacturers at 

the time of their compliance with the 

amended standard set forth in today’s 

rule. 

Component Sourcing and Cost 

Information 

In its written comment following 

publication of the NOPR, Hoshizaki 

commented that the engineering cost 

analysis was unrealistic and incomplete 

since specific parts suppliers, part 

numbers, and parts costs were not 

listed. (Hoshizaki, No. 84 at p. 1) 

In developing its engineering cost 

model, DOE gathered a wide variety of 

input information, including component 

and material costs, to serve as the basis 

for this model. Much of this information 

was collected under nondisclosure 

agreement by DOE’s contractors, or from 

sources which are not publicly 

available. Therefore, in order to protect 

the sensitive nature of this information, 

DOE is unable to disclose the 

information in its notice or technical 

support document. However, in 

developing its engineering performance 

and cost models, DOE ensured that the 

components and features being modeled 

did not present any intellectual property 

issues with respect to sourcing or 

implementation. That is, DOE ensured 

that the features modeled were 

consistent with designs and components 

available on the open market to the 

entire range of CRE manufacturers. 

Coil Costs 

Some manufacturers opined that DOE 

had underestimated the cost of 

manufacturing improved evaporator and 

condenser coils. Southern Store Fixtures 

commented that using smaller tubes in 


tkelley on DSK3SPTVN1PROD with RULES2
17758 Federal Register / Vol. 79, No. 60 / Friday, March 28, 2014 / Rules and Regulations 

38Typically, DOE uses the data for the 5 years 

preceding the year of analysis. However, in this 

case additional data were available up to 2004. 

Hence, data from 2004 to 2010 were used for these 

calculations. 

a fixed size evaporator was found 

through their internal studies to allow 

for only 8% performance improvement, 

while incurring a 290% cost increase. 

Southern Store Fixtures noted that 

making changes to a condensing unit 

would make the cost 80% higher than 

the standard catalog price. (Southern 

Store Fixtures, No. 67 at p. 3) AHRI 

commented that DOE had 

underestimated the added costs 

associated with the implementation of 

higher efficiency evaporator coils. 

(AHRI, No. 75 at p. 5) Traulsen, too, 

commented that DOE estimated values 

of the cost to manufacture improved 

coils was much lower than a cost figure 

provided to it by the largest provider of 

CRE coils in the U.S. (Traulsen, No. 65 

at p. 6) Hillphoenix concurred with 

DOE on the modeled price of condenser 

coils, but noted that evaporator coils 

cost nearly three to four times as much 

as condenser coils. Hillphoenix 

qualified this assertion by pointing out 

that the necessary customization, as 

well as the increased assembly cost 

(labor) of a lower fin density and longer 

width coil, contributed to the increased 

price of the evaporator coil. 

(Hillphoenix, No. 71 at p. 1) 

In response to the comment from 

Southern Store Fixtures, DOE did not 

consider smaller-diameter tubes in its 

evaporator coil designs as modeled in 

the final rule engineering analysis. 

Additionally, DOE modeled the 

components of the condensing unit— 

coil, fans, compressor, and cost to 

assemble—independently, rather than 

modeling the cost of a single 

prepackaged assembly. DOE believes 

that this modeling accurately reflects 

the costs incurred by manufacturers 

when producing the condensing units of 

self-contained equipment. 

Regarding the concerns of AHRI, 

Traulsen and Hillphoenix on the 

modeled costs of condenser and 

evaporator coils, DOE revisited this 

modeling for the final rule. DOE based 

its modeling of coil costs on information 

gathered from teardowns of coils 

present in units currently available on 

the market, and then used these inputs 

in conjunction with an internal cost 

model to develop costs to manufacture 

for these components. These costs factor 

in the prices of raw materials, the costs 

of processing, forming, and assembly 

operations, and other key costs integral 

to the development of the components. 

DOE updated its coil costs for the final 

rule taking into account the design 

changes to the form factors of its 

modeled coils and the information 

provided in stakeholder comments 

regarding the relative costs of different 

coil types. DOE is confident in its use 

of this methodology, which has been 

implemented and vetted through use in 

a number of other past and ongoing 

rulemaking analyses. For further 

information regarding coil modeling, 

please see chapter 5 of the final rule 

TSD. 

e. Manufacturer Markup 

To account for manufacturers’ nonproduction costs and profit margin, DOE 

applies a non-production cost multiplier 

(the manufacturer markup) to the full 

MPC. The resulting MSP is the price at 

which the manufacturer can recover all 

production and non-production costs 

and earn a profit. To meet new or 

amended energy conservation 

standards, manufacturers often 

introduce design changes to their 

product lines that result in increased 

MPCs. Depending on the competitive 

environment for this equipment, some 

or all of the increased production costs 

may be passed from manufacturers to 

retailers and eventually to customers in 

the form of higher purchase prices. The 

MSP should be high enough to recover 

the full cost of the equipment (i.e., full 

production and non-production costs) 

and yield a profit. The manufacturer 

markup has an important bearing on 

profitability. A high markup under a 

standards scenario suggests 

manufacturers can readily pass along 

the increased variable costs and some of 

the capital and equipment conversion 

costs (one-time expenditures) to 

customers. A low markup suggests that 

manufacturers will not be able to 

recover as much of the necessary 

investment in plant and equipment. 

To calculate the manufacturer 

markups, DOE used 10–K reports 

submitted to the SEC by the six publicly 

owned commercial refrigeration 

equipment companies in the United 

States. (SEC 10–K reports can be found 

using the search database available at 

www.sec.gov/edgar/searchedgar/

webusers.htm.) The financial figures 

necessary for calculating the 

manufacturer markup are net sales, 

costs of sales, and gross profit. DOE 

averaged the financial figures spanning 

the years from 2004 to 2010 38 to 

calculate the markups. For commercial 

refrigeration equipment, to calculate the 

average gross profit margin for the 

periods analyzed for each firm, DOE 

summed the gross profit earned during 

all of the aforementioned years and then 

divided the result by the sum of the net 

sales for those years. DOE presented the 

calculated markups to manufacturers 

during the manufacturer interviews for 

the NOPR (see section IV.D.4.g). DOE 

considered manufacturer feedback to 

supplement the calculated markup, and 

refined the markup to better reflect the 

commercial refrigeration market. DOE 

developed the manufacturer markup by 

weighting the feedback from 

manufacturers on a market share basis 

because manufacturers with larger 

market shares more significantly affect 

the market average. DOE used a constant 

markup to reflect the MSPs of both the 

baseline equipment and higher 

efficiency equipment. DOE used this 

approach because amended standards 

may transform high-efficiency 

equipment, which currently is 

considered to be premium equipment, 

into baseline equipment. See chapter 5 

of the final rule TSD for more details 

about the manufacturer markup 

calculation. 

f. Shipping Costs 

The final component of the MSP after 

the MPC and manufacturer markup is 

the shipping cost associated with 

moving the equipment from the factory 

to the first point on the distribution 

chain. During interviews, manufacturers 

stated that the specific party 

(manufacturer or buyer) that incurs that 

cost for a given shipment may vary 

based on the terms of the sale, the type 

of account, the manufacturer’s own 

business practices, and other factors. 

However, for consistency, DOE includes 

shipping costs as a component of MSP. 

In calculating the shipping costs for use 

in its analysis, DOE first gathered 

estimates of the cost to ship a full trailer 

of manufactured equipment an average 

distance in the United States, generally 

representative of the distance from a 

typical manufacturing facility to the first 

point on the distribution chain. DOE 

then used representative unit sizes to 

calculate a volume for each unit. Along 

with the dimensions of a shipping 

trailer and a loading factor to account 

for inefficiencies in packing, DOE used 

this cost and volume information to 

develop an average shipping cost for 

each equipment class directly analyzed. 

g. Manufacturer Interviews 

Throughout the rulemaking process, 

DOE has sought and continues to seek 

feedback and insight from interested 

parties that would improve the 

information used in its analyses. DOE 

interviewed manufacturers as a part of 

the NOPR MIA (see section IV.J). During 

the interviews, DOE sought feedback on 

all aspects of its analyses for 

commercial refrigeration equipment. For 

the engineering analysis, DOE discussed 


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39Available at http://www1.eere.energy.gov/

buildings/appliance_standards/rulemaking.aspx/

ruleid/27. 

the analytical assumptions and 

estimates, cost model, and costefficiency curves with manufacturers. 

DOE considered all of the information 

learned from manufacturers when 

refining the cost model and 

assumptions. However, DOE 

incorporated equipment and 

manufacturing process figures into the 

analysis as averages to avoid disclosing 

sensitive information about individual 

manufacturers’ equipment or 

manufacturing processes. The results of 

the manufacturer interview process 

conducted before the release of the 

NOPR were augmented with additional 

information provided in written 

comments after the NOPR and at the 

NOPR public meeting. More details 

about the manufacturer interviews are 

contained in chapter 12 of the final rule 

TSD. 

5. Energy Consumption Model 

The energy consumption model is the 

second key analytical model used in 

constructing cost-efficiency curves. This 

model estimates the daily energy 

consumption, calculated using the DOE 

test procedure, of commercial 

refrigeration equipment in kilowatthours at various performance levels 

using a design-option approach. In this 

methodology, a unit is initially modeled 

at a baseline level of performance, and 

higher-efficiency technologies, referred 

to as design options, are then 

implemented and modeled to produce 

incrementally more-efficient equipment 

designs. The model is specific to the 

types of equipment covered under this 

rulemaking, but is sufficiently 

generalized to model the energy 

consumption of all covered equipment 

classes. DOE developed the energy 

consumption model as a Microsoft Excel 

spreadsheet.39

For a given equipment class, the 

model estimates the daily energy 

consumption for the baseline, as well as 

the energy consumption of subsequent 

levels of performance above the 

baseline. The model calculates each 

performance level separately. For the 

baseline level, a corresponding cost is 

calculated using the cost model, which 

is described in section IV.D.4.b. For 

each level above the baseline, the 

changes in system cost due to the 

implementation of various design 

options are used to recalculate the cost. 

Collectively, the data from the energy 

consumption model are paired with the 

cost model data to produce points on 

cost-efficiency curves corresponding to 

specific equipment configurations. After 

the publication of the NOPR analysis, 

DOE received numerous stakeholder 

comments regarding the methodology 

and results of the energy consumption 

model. 

a. Release of Engineering Model for 

Review 

At the NOPR public meeting, Zero 

Zone and ACEEE urged DOE to make its 

engineering spreadsheet model publicly 

available. (Zero Zone, Public Meeting 

Transcript, No. 62 at p. 70) (ACEEE, 

Public Meeting Transcript, No. 62 at p. 

125) DOE agreed with Zero Zone and 

ACEEE and released the engineering 

spreadsheet model for public review 

shortly after the NOPR public meeting. 

Stakeholder review of the model served 

as the basis for many of the specific 

comments and suggestions discussed in 

today’s document and incorporated into 

DOE’s final rule analysis. 

b. Anti-Sweat Heater Power 

Some stakeholders opined that the 

DOE model did not fully consider some 

equipment classes and components 

which used anti-sweat heat. Traulsen 

noted that, due to gasket and breaker 

strip inefficiencies, VCS.SC.L and 

VCS.SC.M equipment will require some 

auxiliary heat around door perimeters to 

prevent condensation, even at ambient 

conditions of 75 °F and 55% RH. 

(Traulsen, No. 65 at p. 11) Hussmann 

noted that no-heat doors for VCT.RC.M 

were not suitable in high-humidity 

conditions, since they could lead to 

condensation on the doors and the risk 

of water dripping onto the floor. 

(Hussmann, No. 77 at p. 9) AHRI 

commented that there was no clear 

justification provided for why certain 

doors were modeled with anti-sweat 

heat power and others were modeled 

without it, further pointing out, that 

anti-sweat heat is not limited only to 

doors, but often also applies to frames 

and mullions too. (AHRI, No. 75 at p. 8) 

DOE appreciates the input from 

commenters regarding the use of antisweat heat and has updated its 

engineering model for the final rule 

stage to better reflect the needs of 

different equipment classes in this 

respect. In response to the comment 

from Traulsen and based on additional 

investigational teardowns performed at 

the final rule stage, DOE added antisweat heater power to some solid-door 

classes in order to account for 

inefficiencies in gasketing which could 

otherwise result in condensation or frost 

issues. The magnitude of the power of 

these heaters was developed based on 

figures included in stakeholder 

comments applicable to classes 

VCS.SC.M and VCS.SC.L, as well as 

from measurements taken during 

teardown analysis performed at the final 

rule stage. 

During manufacturer interviews and 

in investigations of the current offerings 

of commercial refrigeration equipment 

manufacturers and door suppliers, DOE 

encountered a number of ‘‘energy-free’’ 

transparent door designs for mediumtemperature applications. This served as 

the basis for the modeling of some doors 

without anti-sweat heat in the NOPR 

analysis, as referenced by AHRI and 

Hussmann. However, in response to the 

concerns of stakeholders over an 

assumption of zero energy doors being 

too strict for field applications, DOE 

added a modest amount of anti-sweat 

heat to its modeling of transparent doors 

for medium-temperature applications in 

the final rule engineering analysis. DOE 

believes that this modeled design 

provides energy savings benefits over 

standard designs while maintaining the 

ability to utilize some anti-sweat heat to 

prevent condensation issues during use. 

In response to the concerns of AHRI, 

DOE wishes to clarify that for 

transparent door classes, the modeled 

‘‘door’’ anti-sweat heat includes all antisweat heat on the face of the unit, 

including frame, mullion, and glass 

heat. This anti-sweat heat is included 

with the modeling of the door because 

generally, the display case manufacturer 

purchases the doors and frames as a 

single item, inclusive of the anti-sweat 

heaters, which is then installed in an 

opening in the case body. For cases with 

solid doors, as well as open cases, the 

perimeter, gasket, mullion, and/or face 

heater power is included under the 

category of ‘‘non-door anti-sweat 

power’’ in the design specifications tab 

of the engineering analysis spreadsheet 

model. Therefore, while the needed 

power may be accounted for differently 

among the different classes, the 

appropriate heater types are modeled for 

each class. DOE believes that its efforts 

in updating anti-sweat heater powers 

modeled in the engineering analysis for 

the final rule sufficiently and directly 

address the concerns voiced by 

stakeholders at the NOPR stage. 

c. Coil Performance Modeling 

Stakeholders offered feedback to DOE 

on how the simulation of coil 

performance could be improved to 

better reflect the performance of 

evaporator and condenser coils in the 

field. Traulsen commented that while 

DOE states that evaporators can be 

designed to have a discharge air 

temperature that is a minimum of 10 

degrees F colder than the product 

temperature, the baseline model in the 


tkelley on DSK3SPTVN1PROD with RULES2
17760 Federal Register / Vol. 79, No. 60 / Friday, March 28, 2014 / Rules and Regulations 

40Coil UA is a lumped parameter describing the 

heat transfer capability of a heat exchanger, 

accounting for the thermal transmittance (U) and 

surface area (A) of the specific heat exchanger 

design. 

analysis shows a product-to-refrigerant 

temperature difference of 11 degrees F. 

Traulsen further sought clarification on 

where the improvement in evaporator 

performance could be attained since the 

temperature differential at the baseline 

was already low. (Traulsen, No. 65 at p. 

5) Hussmann commented that the gap 

between discharge air temperature and 

saturated evaporator temperature was 

unrealistically low for certain 

equipment classes. (Hussmann, No. 77 

at p. 10) 

Hillphoenix and AHRI noted that, 

conventionally, coil UA 40 is calculated 

using log-mean temperature difference 

(LMTD) and inlet temperature. Further, 

Hillphoenix commented that the use of 

what it perceived to be incorrect 

formulae had led to over-estimation of 

UA for condensers and evaporators, and 

that different methods were used to 

calculate UA for condensers than were 

used for evaporators. (AHRI, No. 75 at 

p. 5) (Hillphoenix, No. 71 at p. 5). 

AHRI commented that since both the 

previous and current rulemakings 

included rifled tubing and increased fin 

pitch, the total prototype energy 

consumption should have been the 

same across rulemakings. Further, AHRI 

commented that the prototype 

condenser coil scenario is not fully 

representative of all condensers for SC 

equipment. (AHRI, No. 75 at p. 8) 

In response to the concerns of 

Traulsen and Hussmann, DOE reevaluated its parameters for modeling of 

coil temperature performance. 

Specifically, it adjusted the temperature 

differential between product 

temperature and saturated evaporator 

temperature to be 15 °F for certain 

classes under the baseline configuration. 

DOE believes that this is a more 

accurate representation of evaporator 

performance based on the feedback that 

it has received from comments and data 

from testing and equipment literature. 

The result is that the temperature 

differential at the baseline and highperformance level is higher, reflecting 

the adjustments to this parameter 

suggested by stakeholders. 

In the engineering model, evaporator 

coil UA is calculated as a function of 

case heat load and a log mean 

temperature difference based on the 

saturated evaporator temperature, 

discharge air temperature, and return air 

temperature. This is the same 

methodology that was used in the 2009 

final rule engineering analysis, which 

underwent rigorous examination by 

stakeholders. Therefore, DOE believes 

that Hillphoenix and AHRI are 

misinterpreting DOE’s methodology 

when discussing evaporator 

performance. Additionally, with respect 

to the comment that different formulae 

were applied to the modeling of 

evaporators and condensers, DOE agrees 

with this fact, but does not believe that 

this is an incorrect methodology. The 

modeling of the evaporator reflects the 

fact that chilled case air is being 

recirculated, whereas modeling of the 

condenser reflects the fact that the 

condenser is rejecting heat to an 

ambient environment which functions 

as an effectively infinite thermal sink. 

Therefore, DOE believes that these 

different performance environments 

warrant different modeling, and 

maintains its methodology for 

conducting this modeling in the final 

rule. 

With regard to the concern of AHRI 

over disparities between the coil 

performance levels modeled in the 2009 

final rule and the current rulemaking, 

DOE performed new analysis for the 

current rulemaking based on teardowns 

and simulation conducted at the NOPR 

stage. At the final rule stage, based on 

further input from stakeholder 

comments, DOE again updated this 

performance and cost modeling. 

Therefore, due to the fact that the 

analysis was conducted anew at each of 

these stages and is not directly related 

to the analysis conducted for the 2009 

final rule, DOE believes that the 

differences in modeled performance are 

reasonable and reflect improvements to 

DOE’s understanding of baseline and 

high-performance coil designs. 

In reference to AHRI’s mention of the 

applicability of DOE’s condenser coil 

design to a variety of commercial 

refrigeration equipment, DOE modeled a 

baseline coil based upon geometries and 

features measured from teardowns of 

representative models for sale on the 

market today, and then implemented 

further design improvements based on 

the inputs of outside subject matter 

experts and within the guidance 

provided by stakeholder comments and 

feedback. The engineering model then 

expands the cost and capacity of the 

modeled coil to adjust to the needs of 

different equipment sizes being 

simulated. Thus, DOE believes that the 

modeled coil design accurately reflects 

the real-world needs of condenser heat 

exchangers for this equipment. 

d. Compressor Performance Modeling 

Manufacturers and consumers 

expressed concern over DOE’s 

assumptions regarding the advances in 

compressor technology anticipated 

before the compliance date. Danfoss, 

Traulsen, AHRI, True, Structural 

Concepts, Continental, NAFEM and 

Hoshizaki commented that if a 10% 

compressor efficiency improvement 

were possible for a 5% cost increase, 

then it is most likely that manufacturers 

would have already adopted this 

technology. (Traulsen, No. 65 at p. 12) 

(AHRI, No. 75 at p. 9) (True, No. 76 at 

p. 2) (Structural Concepts, No. 85 at p. 

2) (Continental, No. 87 at p. 2) (NAFEM, 

No. 93 at p. 3) (Hoshizaki, No. 84 at p. 

2) Further, Danfoss stated that, at most, 

a 1–2% increase in efficiency could be 

gained for a 5% cost increase. (Danfoss, 

No. 61 at p. 2) 

DOE appreciates the specific and 

detailed input which it received from 

manufacturers and suppliers regarding 

its previous assumptions of potential 

improvements in compressor efficiency 

and the corresponding costs to attain 

these performance increases. In light of 

these comments, DOE updated its 

performance and cost modeling of 

compressors for the final rule analysis. 

Specifically, DOE implemented the 

suggestion of Danfoss, a major supplier, 

which stated that a 2% increase in 

performance over today’s standard 

offerings, with a corresponding cost 

increase of 5%, is attainable. DOE 

believes that these parameters better 

reflect the options available to 

manufacturers of commercial 

refrigeration equipment. 

e. Insulation Modeling 

Some stakeholders felt that DOE’s 

analytical model of case insulation had 

failed to sufficiently capture its effect on 

manufacturing processes and field 

performance. Continental and Structural 

Concepts commented that the actual Rvalue of urethane foam insulation is 

significantly lower than the value 

modeled. (Structural Concepts, No. 85 at 

p. 2) (Continental, No. 87 at p. 3) AHRI 

and True suggested that an R-Value of 

6 per inch was more realistic for 

insulation than the currently modeled 8 

per inch. (AHRI, No. 75 at p. 5) (True, 

No. 76 at p. 3) Concurrently, NAFEM 

commented that 1.25 inches of added 

insulation would actually be required to 

meet the level of insulating performance 

included in the proposed standard. 

(NAFEM, No. 93 at p. 5) True 

commented that there was a loss of 

insulation value over time using 

urethane insulation and plastic liners. 

(True, No. 76 at p. 3) 

Traulsen commented that the DOE 

assumption that increased insulation 

would not affect cabinet structure was 

incorrect. Traulsen further noted that 

some aspects of cabinet geometry and 

features where the highest level of heat 


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leakage occur appear to be beyond the 

scope of DOE’s model. (Traulsen, No. 65 

at p. 7) Continental, too, commented 

that cabinet geometry would lead to low 

in-place insulation values, requiring 

much thicker insulation in some areas 

than others, to achieve the proposed 

standards. (Continental, No. 87 at p. 3) 

Traulsen commented that since the 

2009 rule noted that a 1⁄2′′ insulation 

increase was not viable for some classes, 

and since no significant changes in 

technology have occurred, DOE should 

exclude this design option from a 

proposed standard level. (Traulsen, No. 

65 at p. 8) 

In response to the comments from 

Structural Concepts, Continental, AHRI, 

True, and NAFEM, DOE believes that an 

R-value of 8 per inch is accurate for 

foamed-in-place polyurethane 

insulation as used in commercial 

refrigeration equipment. DOE has 

corroborated this value in past and 

ongoing rulemakings against product 

literature, supplier and academic 

studies, and discussions in 

manufacturer interviews. Therefore DOE 

believes that this is an accurate value 

and has maintained it for the modeling 

of foam performance in its final rule 

engineering analysis. With regard to the 

comment from True on changes in 

insulative value of foam over time, DOE 

notes that certification of equipment is 

conducted at or shortly after the time of 

manufacture, and thus equipment in 

that state is modeled in DOE’s 

engineering analysis. DOE did not 

model the performance of equipment at 

points long after the time of 

manufacture. 

DOE based its modeling of case heat 

loads on measured geometries as seen in 

units purchased and torn down over the 

course of the rulemaking, as well as on 

product literature for designs currently 

on the market. DOE notes that these 

geometries in some cases included the 

level of increased foam thicknesses 

modeled as a design option, meaning 

that manufacturers were already 

including these increases and 

accounting for their effects. Thus, since 

proof of concept is already being 

presented in today’s equipment market, 

DOE does not believe that there are 

inaccuracies in its levels of modeled 

foam thickness. In response to the 

comment from Traulsen, DOE believes 

that its model sufficiently accounts for 

the thermal effects of conduction, 

infiltration, and other heat loads 

incident upon the refrigerated case. 

With respect to Continental’s concerns, 

DOE has examined a wide variety of 

case designs on the market, but 

generally has not encountered instances 

in which low in-place insulation 

thicknesses have been observed. In most 

instances that DOE has examined, 

manufacturers have maintained a 

standard thickness throughout the body 

of the case. Therefore, DOE believes that 

its insulation modeling is accurate and 

consistent with designs currently 

produced by the industry. 

DOE conducted its current analysis 

based on the latest available information 

regarding equipment designs, cost and 

performance of design options and 

components, and downstream factors 

such as electricity price forecasts. This 

information was updated entirely from 

the 2009 rule. Therefore, in response to 

Traulsen’s comment that DOE should 

not consider a design option in this 

analysis just because it was not 

included in the analytical levels 

corresponding to standards set for some 

classes in 2009, DOE cautions that a 

direct comparison between the two 

rulemakings may not be accurate. 

Changes in prices, market factors, and 

other inputs since 2009 mean that 

outcomes between the two analyses 

could be different. Therefore, DOE has 

conducted the current analysis in 

isolation based on the best currently 

available data, and has set the standard 

levels included in today’s rule using the 

results of that analysis. 

f. Lighting Performance 

Several manufacturers opined that 

DOE had modeled LED performance too 

aggressively. Southern Store Fixtures 

commented that even with more 

directional light from LED systems, 

higher wattage LEDs with higher 

number of diodes than those modeled 

by DOE would be required to provide 

illumination comparable to a 

fluorescent system. (Southern Store 

Fixtures, No. 67 at p. 2) Traulsen, in 

agreement with other commenters, 

noted that LEDs require more watts per 

lumen than high efficiency T8 lighting 

which uses reflectors. (Traulsen, No. 65 

at p. 3) Continental commented that, 

while LEDs are significantly more 

directional than fluorescent lights, the 

efficacy modeled by DOE was 

overestimated. (Continental, No. 87 at p. 

2) More specifically, AHRI commented 

that although LEDs are directional, the 

DOE assumption that the output of 4-ft 

& 5-ft LEDs is only 29% of that 

associated with T8 lighting is flawed, 

since the directional nature of LEDs 

cannot fully compensate for such a large 

differential. (AHRI, No. 75 at p. 3) 

Additionally, True commented that due 

to the varied nature of illumination 

needs across products, many models 

require higher wattages if LEDs are 

used. (True, No. 76 at p. 1) AHRI added 

that reducing the light output into cases 

through use of LEDs would affect 

consumer utility. (AHRI, No. 75 at p. 4) 

Traulsen commented that CRE 

applications, especially those requiring 

low temperature settings, could 

experience degradation in LED color 

quality and shorter lifespans. Traulsen 

further commented that the variety of 

displayed packaging or product types 

may need special light colors, and that 

one size fits all approach to LED lighting 

could lead to loss of utility. (Traulsen, 

No. 65 at p. 4) 

Providing an additional viewpoint, 

the CA IOUs commented that the 

assumed level of efficacy for LED 

technology (54 lumens per watt) was 

very conservative. The CA IOUs further 

noted that using the DesignLights 

Consortium online database, the current 

simple average for all vertical 

refrigerated case lighting was 59 lumens 

per watt, with the average for products 

added in 2013 being 66 lumens per 

watt. (CA IOUs, No. 63 at p. 7) 

AHRI commented that comparisons 

between T8, super T8, and LED lighting 

systems as modeled in the previous and 

current rulemakings suggest that no 

significant improvements have been 

made in lighting since the last 

rulemaking cycle. (AHRI, No. 75 at p. 2) 

With regard to specific equipment 

classes, Hillphoenix commented that 

the savings from SVO.RC.M due to LED 

lighting was the same as for VOP.RC.M 

even though the semi-vertical cases 

would have fewer shelf lights than the 

vertical open cases. (Hillphoenix, No. 71 

at p. 6) Further, AHRI commented that 

in the case of VCT.RC.M and VCT.RC.L 

equipment, the LED lighting design 

option provides about an 80–83% 

increased energy consumption 

reduction for the current rulemaking as 

compared to the previous rulemaking. 

(AHRI, No. 75 at p. 9) 

DOE agrees with the comments from 

Southern Store Fixtures, Continental, 

and Traulsen that, in absolute terms, 

LED lighting produces fewer output 

lumens per watt than T8 fluorescent 

lighting. However, DOE understands 

that due to the directionality of LED 

lighting, a much greater percentage of 

the lighting is incident upon the 

product, rather than being diffused into 

the cabinet. With respect to the 

concerns of AHRI and Continental that 

this directionality is still not sufficient 

to compensate for the levels of lighting 

modeled in the engineering analysis, 

DOE asserts that it based its modeling 

directly on the specific configurations of 

equipment being shipped on the market 

at the time of the analysis. When 

selecting LED lighting specifications to 

model, DOE performed research through 

manufacturer literature and catalogs, 


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41This software is an industry-accepted, publiclyavailable software tool used to model the 

performance of various fenestration components 

such as windows. More information is available at 

http://windows.lbl.gov/software/window/

window.html. 

studies of lighting manufacturer product 

literature, and physical teardowns of 

existing units on the market. Developed 

based on this data, DOE believes that its 

lighting specifications reflect the current 

needs of customers and designs 

produced by manufacturers to satisfy 

those needs. 

In addition, based on new information 

provided by stakeholder comments at 

the final rule stage, DOE has increased 

the modeled lumen output of its LED 

fixtures by roughly 20% across all 

classes. DOE believes that this added 

modeled light output serves to address 

the concerns presented by stakeholders 

in their comments. Additionally, DOE 

understands that manufacturers have 

concerns over the applicability of LED 

lighting to the wide variety of models 

merchandised within commercial 

refrigeration equipment. During its 

manufacturer interviews, DOE 

specifically addressed this subject, 

speaking to manufacturers of a broad 

range of equipment about their use of 

LEDs. Generally, manufacturers stated 

that LED technology has advanced 

sufficiently that issues with color 

matching and product color 

illumination are no longer as significant 

as in the past. DOE’s research into 

current manufacturer designs aligns 

with this finding, as manufacturers are 

using LED lighting in all applicable 

equipment families. With respect to 

concerns over LED lifetimes, based on 

its discussions with manufacturers, DOE 

does understand that there still remain 

variations in quality and durability of 

LED products based on the chosen 

supplier, but that LED reliability has 

improved significantly to its current 

state. Additionally, DOE has accounted 

for the need for replacement of LED 

lighting fixtures as part of the 

maintenance costs analyzed in its lifecycle cost and payback period analysis. 

After receiving the comment from the 

CA IOUs regarding standard efficacies of 

LED fixtures produced today, DOE 

researched the referenced DesignLights 

Consortium online database and found 

that the listed data agreed with the 

performance levels stated in the 

comment from the CA IOUs. In response 

to this new data, DOE updated its 

efficacy figures for the modeled LED 

fixtures in line with those levels 

depicted for models currently on the 

market per the database. This resulted 

in an approximate 20% increase in 

modeled lumen output for all LED 

fixtures modeled. DOE believes that this 

adjustment allows its LED modeling to 

better reflect the level of technology 

currently available on the market, while 

simultaneously addressing concerns 

from manufacturers and other 

stakeholder about low levels of product 

illumination using LED lighting. 

DOE agrees with AHRI that no major 

new lighting technologies have come 

onto the market since the conduct of the 

2009 rulemaking; that is, that the 

options currently available to 

manufacturers consist largely of T8 

fluorescent and LED lighting. Therefore, 

in building up engineering costefficiency curves depicting the price 

and performance of equipment from 

baseline to max-tech levels, DOE 

included these technologies in the 

baseline and higher-efficiency scenarios 

and implemented energy-saving lighting 

features alongside other design options 

in order of ascending payback period. 

With respect to AHRI’s assertion of 

significant new improvements to 

lighting technologies since the modeling 

for the 2009 final rule was performed, 

DOE points out that it updated the 

prices and performance levels of the 

various lighting technologies to reflect 

new information since the 2009 

rulemaking, and reordered its design 

options and cost-efficiency curves 

correspondingly. 

In response to the comments from 

AHRI and Hillphoenix comparing the 

perceived relative efficacies of specific 

design options in the engineering 

analysis to the incremental performance 

changes associated with them in the 

2009 rule, DOE cautions against making 

such comparisons since many other 

factors were not held constant. Updates 

to the baseline configuration, improved 

pricing and performance modeling, 

inclusion of new design options, and 

updated design option ordering all 

mean that the modeled order of 

implementation of design options, and 

the effects of those design options being 

implemented, has in many instances 

changed since the 2009 final rule 

analysis. Therefore, a direct comparison 

would be inaccurate and unfair. 

Similarly, DOE cautions against direct 

comparisons of specific incremental 

results across different equipment 

classes. Engineering results for each 

equipment class were calculated 

independently based upon the best 

available data on equipment 

configuration, design option 

performance, and costs. Therefore, the 

results of each class should be examined 

independently, and there was no 

interrelation to other classes built into 

the model. 

g. Transparent Door Performance 

Stakeholders expressed concern over 

the modeled improvements in 

transparent door performance between 

the current and previous rulemaking 

analyses. AHRI commented that there 

was a decrease of over 60% in the Ufactors for transparent doors between 

the previous final rule and the current 

NOPR, even though both results were 

arrived at using the Lawrence Berkeley 

National Laboratory (LBNL) 

WINDOW41 software. Further, AHRI 

noted that the U-factor associated with 

high-performance doors for VCT.M 

equipment in 2009 did not even meet 

the level of performance suggested by 

the U-factor that is listed in the current 

TSD for standard doors. (AHRI, No. 75 

at p. 9) Similarly, Hussmann 

commented that the U-factors and antisweat heat values for transparent doors 

in various classes were significantly 

lower than in the 2009 final rule, and 

that base cases in the current NOPR 

analysis did not meet the definition of 

high-performance from the previous 

analysis. (Hussmann, No. 77 at p. 2) 

Hillphoenix commented that the Ufactor and heater power varied for 

identical classes from the previous 

rulemaking to the current. (Hillphoenix, 

No. 71 at p. 7) AHRI commented that for 

HCT.M equipment, while the overall UFactor specified for standard doors 

seems appropriate, the U-factor for highperformance doors seems very low. 

(AHRI, No. 75 at p. 10) 

In response to the stakeholder 

concerns regarding the modeled 

performance of transparent doors, DOE 

revisited its modeling of this feature as 

part of its final rule engineering 

analysis. In doing so, it incorporated 

comments and suggestions from 

stakeholders received during the NOPR 

public meeting and in written 

comments after the publication of the 

NOPR regarding design attributes such 

as the number of panes of glass 

modeled, the use of low-e coatings, and 

appropriate levels of anti-sweat heat. 

DOE also gathered additional 

information through physical inspection 

and teardown of several additional 

glass-door models procured during the 

final rule stage. Based on these inputs, 

DOE modeled the various types of glass 

doors using the latest version of the LBL 

WINDOW software to develop new, 

more accurate whole-door U-factors. In 

response to the comments on alignment 

of the previous and current baseline 

door designs, DOE did in some cases, 

where appropriate, retain the U-factors 

and anti-sweat powers used at the 

baseline in the 2009 final rule. However, 

in other instances where DOE found 

evidence that the market baseline and 


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42http://www.energystar.gov/certified-products/

certified-products. 

43http://www.appliances.energy.ca.gov/

Default.aspx. 

features included in standard door 

offerings had evolved since that time, 

DOE sought to include in its baseline 

designs features which reflect the 

current offerings of major door 

manufacturers. For full details on the 

modeled performance attributes of 

transparent doors, please see chapter 5 

of the final rule TSD. 

h. Validation of Engineering Results 

DOE’s engineering results as 

presented in the NOPR were based on 

the results of analytical modeling. 

Several stakeholders, however, felt that 

the analysis was purely theoretical and 

did not account for factors affecting 

field performance. Hoshizaki 

commented that DOE’s engineering 

analysis considers a theoretical base 

case with no experimental or physical 

data to support the model. (Hoshizaki, 

No. 84 at p. 1) Traulsen commented that 

the MDEC targets were evaluated by 

using a theoretical prototype based on 

market trends and assumptions, and 

contrasted that with DOE’s statement in 

the NOPR TSD that design options 

comprising the maximum 

technologically feasible level must have 

been physically demonstrated. Further, 

Traulsen noted that the engineering 

analysis was only an academic exercise 

based on computer simulations rather 

than physical results. (Traulsen, No. 65 

at p. 2) 

Hoshizaki, ACEEE and Lennox urged 

DOE to perform validation testing and 

physically demonstrate the achievement 

of the proposed efficiency improvement 

levels. (Hoshizaki, No. 84 at p. 2) 

(ACEEE, Public Meeting Transcript, No. 

62 at p. 351) (Lennox, No. 73 at p. 2) 

Similarly, NAFEM noted that the 

modeled maximum-technology designs 

were not backed by tests or prototypes. 

(NAFEM, No. 93 at p. 3) The CA IOUs 

strongly urged DOE to calibrate and 

validate its model with test and 

prototype data, asserting that while 

many of the assumptions made by DOE 

might hold true in theory, they may not 

be physically possible to realize. (CA 

IOUs, No. 63 at p. 6) 

Traulsen commented that the success 

of the 2009 final rule standard could 

have been reviewed using voluntary 

databases containing empirical data of 

commonly-produced units. Traulsen 

further commented that DOE should 

base its future MDEC targets on data 

regarding best practices and 

technologies available in the market, as 

indicated by these databases. (Traulsen, 

No. 65 at p. 2) 

The Joint Comment noted that DOE 

utilized a theoretical engineering model 

approach for the 2011 residential 

refrigerators final rule. 76 FR 57516 

(Sept. 15, 2011) Further, the Joint 

Comment noted that the 2011 

residential refrigeration model’s maxtech levels were 59% more efficient 

than the existing standard, even though 

the most efficient model available at the 

time was only 27% more efficient. (Joint 

Comment, No. 91 at p. 2) 

DOE agrees that its results are based 

on analytical modeling, but disagrees 

with the assertions from Hoshizaki and 

Traulsen that the simulation and 

modeling were purely theoretical in 

nature. DOE based its analysis on a 

model which was developed for the 

2009 final rule and updated to 

accommodate the needs of this current 

rulemaking. Inputs to the model 

included data from tangible sources 

such as manufacturer literature, 

manufacturer interviews, production 

facility tours, reverse engineering and 

teardown of existing products on the 

market, and tests of commercial 

refrigeration equipment and 

components. DOE maintains its 

assertion, contrary to Traulsen’s 

comment, that all design options 

modeled have been physically 

demonstrated in the commercial 

refrigeration market or in comparable 

products. 

In agreement with the Joint Comment, 

DOE points to the 2011 residential 

refrigerators final rule, the 2009 

commercial refrigeration equipment 

final rule, and the 2009 refrigerated 

beverage vending machine final rule as 

examples of cases where analytical tools 

and simulation have been used to 

develop effective energy efficiency 

standards. 76 FR 57516 (Sept. 15, 2011); 

74 FR 1092 (Jan. 9, 2009); 74 FR 44914 

(Aug. 31, 2009) Additionally, DOE notes 

that it recently issued a rule, strongly 

supported by industry, which will allow 

manufacturers to use alternative energy 

determination methods (AEDMs), which 

are non-testing methodologies and 

analytical tools, to certify the 

performance of their equipment. 78 FR 

79579 (December 31, 2013) 

In response to the comments from 

Traulsen, Hoshizaki, ACEEE, the CA 

IOUs, Lennox, and NAFEM that DOE 

perform validation testing to confirm 

the veracity of its model, at the final 

rule stage DOE procured a number of 

commercial refrigeration units currently 

on the market, including highperformance units featuring advanced 

designs. It gathered physical test data on 

each unit from certification directories 

and, in some cases, from independent 

laboratory tests conducted by DOE on 

the units. DOE then performed physical 

teardowns and inspection of the units to 

quantify the features and design 

attributes included in each model. 

Then, DOE used this empiricallydetermined data as inputs into its 

engineering model, allowing the model 

to simulate these specific manufacturer 

models as closely as possible. The 

results showed good alignment between 

the model outputs and the physical test 

results across a range of equipment 

classes and efficiencies, validating the 

abilities of the model. For further 

information on this validation exercise, 

please see chapter 5 of the final rule 

TSD. 

With regard to the suggestion from 

Traulsen that DOE reference existing 

equipment performance databases, at 

the final rule stage of this rulemaking, 

DOE utilized information from the 

ENERGY STAR42 and California Energy 

Commission 43 appliance databases as a 

point of comparison to its engineering 

analysis results. This allowed DOE to 

compare its analytical results to existing 

directories of certified data and ensure 

that the results fell within a reasonable 

range of performance values. However, 

DOE notes that neither of these 

databases is necessarily comprehensive 

and exhaustive of all models offered for 

sale in the United States, and that 

market data only capture those designs 

which are currently being built, not all 

of those which may be feasible. For 

these reasons, while DOE compared its 

results against those databases as a 

check, it continued to use a design 

option approach and simulation as the 

basis for developing its engineering 

analysis results, rather than developing 

standard levels solely from existing 

market data. 

E. Markups Analysis 

DOE applies multipliers called 

‘‘markups’’ to the MSP to calculate the 

customer purchase price of the analyzed 

equipment. These markups are in 

addition to the manufacturer markup 

(discussed in section IV.D.4.e) and are 

intended to reflect the cost and profit 

margins associated with the distribution 

and sales of the equipment. DOE 

identified three major distribution 

channels for commercial refrigeration 

equipment, and markup values were 

calculated for each distribution channel 

based on industry financial data. The 

overall markup values were then 

calculated by weighted-averaging the 

individual markups with market share 

values of the distribution channels. 

In estimating markups for CRE and 

other products, DOE develops separate 

markups for the cost of baseline 


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17764 Federal Register / Vol. 79, No. 60 / Friday, March 28, 2014 / Rules and Regulations 

44Monte Carlo simulation is, generally, a 

computerized mathematical technique that allows 

for computation of the outputs from a mathematical 

model based on multiple simulations using 

different input values. The input values are varied 

based on the uncertainties inherent to those inputs. 

The combination of the input values of different 

inputs is carried out in a random fashion to 

simulate the different probable input combinations. 

equipment and the incremental cost of 

higher-efficiency equipment. 

Incremental markups are applied as 

multipliers only to the MSP increments 

of higher-efficiency equipment 

compared to baseline, and not to the 

entire MSP. 

Traulsen stated that, in its experience, 

the initial markup on equipment will be 

consistent with production costs, and 

that the incremental markups will 

increase with higher levels of product 

efficiency due to product 

differentiation. (Traulsen, No. 65 at p. 

18) DOE agrees that manufacturer 

markups are often larger on higherefficiency equipment due to product 

differentiation strategies. However, 

DOE’s approach considers a situation in 

which products at any given efficiency 

level may be the baseline products 

under new or amended standards (i.e., 

they just meet the standard). In that 

situation, a typical markup would 

apply. DOE uses average values for 

manufacturer markups. 

Traulsen also stated that it did not 

believe that wholesalers differentiate 

markups based on the technologies 

inherently present in this equipment 

and that, in its experience, wholesalers/ 

resellers will use traditional markup 

rates regardless of equipment’s energy 

efficiency. (Traulsen, No. 65 at p. 18) 

DOE’s approach for wholesaler 

markups does not imply that 

wholesalers differentiate markups based 

on the technologies inherently present 

in the equipment. It assumes that the 

average markup declines as the 

wholesalers’ cost of goods sold increases 

due to the higher cost of more-efficient 

equipment. If the markup remains 

constant while the cost of goods sold 

increases, as Traulsen’s comment 

suggests, the wholesalers’ profits would 

also increase. While this might happen 

in the short run, DOE believes that the 

wholesale market is sufficiently 

competitive such that there would be 

pressure on margins. DOE recognizes 

that attempting to capture the market 

response to changing cost conditions is 

difficult. However, DOE’s approach is 

consistent with the mainstream 

understanding of firm behavior in 

competitive markets. 

See chapter 6 of the final rule TSD for 

more details on DOE’s markups 

analysis. 

F. Life-Cycle Cost and Payback Period 

Analysis 

DOE conducts LCC analysis to 

evaluate the economic impacts of 

potential amended energy conservation 

standards on individual commercial 

customers—that is, buyers of the 

equipment. LCC is defined as the total 

customer cost over the life of the 

equipment, and consists of purchase 

price, installation costs, and operating 

costs (maintenance, repair, and energy 

costs). DOE discounts future operating 

costs to the time of purchase and sums 

them over the expected lifetime of the 

piece of equipment. PBP is defined as 

the estimated amount of time it takes 

customers to recover the higher 

installed costs of more-efficient 

equipment through savings in operating 

costs. DOE calculates the PBP by 

dividing the increase in installed costs 

by the average savings in annual 

operating costs. 

As part of the engineering analysis, 

design option levels were ordered based 

on increasing efficiency (i.e., decreasing 

energy consumption) and increasing 

MSP. For the LCC analysis, DOE chose 

a maximum of eight levels, henceforth 

referred to as ‘‘efficiency levels,’’ from 

the list of engineering design option 

levels. For equipment classes for which 

fewer than eight design option levels 

were defined in the engineering 

analysis, all design option levels were 

used. However, for equipment classes 

where more than eight design option 

levels were defined, DOE selected 

specific levels to analyze in the 

following manner: 

1. The lowest and highest energy 

consumption levels provided in the 

engineering analysis were preserved. 

2. If the difference in reported energy 

consumptions and reported 

manufacturer price between sequential 

levels was minimal, only the higher 

efficiency level was selected. 

3. If the energy consumption savings 

benefit between efficiency levels 

relative to the increased cost was very 

similar across multiple sequential 

levels, an intermediate level was not 

selected as an efficiency level. 

The first efficiency level (Level 0) in 

each equipment class is the least 

efficient and the least expensive 

equipment configuration in that class. 

The higher efficiency levels (Level 1 and 

higher) exhibit progressive increases in 

efficiency and cost from Level 0. The 

highest efficiency level in each 

equipment class corresponds to the 

max-tech level. Each higher efficiency 

level represents a potential new 

standard level. 

The installed cost of equipment to a 

customer is the sum of the equipment 

purchase price and installation costs. 

The purchase price includes MPC, to 

which a manufacturer markup and 

outbound freight cost are applied to 

obtain the MSP. This value is calculated 

as part of the engineering analysis 

(chapter 5 of the final rule TSD). DOE 

then applies additional markups to the 

equipment to account for the markups 

associated with the distribution 

channels for the particular type of 

equipment (chapter 6 of the final rule 

TSD). Installation costs were varied by 

state, depending on the prevailing labor 

rates. 

Operating costs for commercial 

refrigeration equipment are the sum of 

maintenance costs, repair costs, and 

energy costs. These costs are incurred 

over the life of the equipment and 

therefore are discounted to the base year 

(2017, which is the compliance date of 

any amended standards that are 

established as part of this rulemaking). 

The sum of the installed cost and the 

operating cost, discounted to reflect the 

present value, is termed the life-cycle 

cost or LCC. Generally, customers incur 

higher installed costs when they 

purchase higher efficiency equipment, 

and these cost increments will be 

partially or wholly offset by savings in 

the operating costs over the lifetime of 

the equipment. LCC savings are 

calculated for each efficiency level of 

each equipment class. 

The PBP of higher efficiency 

equipment is obtained by dividing the 

increase in the installed cost by the 

decrease in annual operating cost. In 

addition to energy costs (calculated 

using the electricity price forecast for 

the first year), the annual operating cost 

includes annualized maintenance and 

repair costs. PBP is calculated for each 

efficiency level of each equipment class. 

Apart from MSP, installation costs, 

and maintenance and repair costs, other 

important inputs for the LCC analysis 

are markups and sales tax, equipment 

energy consumption, electricity prices 

and future price trends, expected 

equipment lifetime, and discount rates. 

Many inputs for the LCC analysis are 

estimated from the best available data in 

the market, and in some cases the inputs 

are generally accepted values within the 

industry. In general, each input value 

has a range of values associated with it. 

While single representative values for 

each input may yield an output that is 

the most probable value for that output, 

such an analysis does not provide the 

general range of values that can be 

attributed to a particular output value. 

Therefore, DOE carried out the LCC 

analysis in the form of Monte Carlo 

simulations,44 in which certain inputs 


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The outputs of the Monte Carlo simulations reflect 

the various outputs that are possible due to the 

variations in the inputs. 

45A Weibull survival function is a continuous 

probability distribution function that is used to 

approximate the distribution of equipment lifetimes 

of commercial refrigeration equipment. 

46Bureau of Labor Statistics, Producer Price Index 

Industry Data, Series: PCU3334153334153. 

were expressed as a range of values and 

probability distributions to account for 

the ranges of values that may be 

typically associated with the respective 

input values. The results, or outputs, of 

the LCC analysis are presented in the 

form of mean and median LCC savings; 

percentages of customers experiencing 

net savings, net cost and no impact in 

LCC; and median PBP. For each 

equipment class, 10,000 Monte Carlo 

simulations were carried out. The 

simulations were conducted using 

Microsoft Excel and Crystal Ball, a 

commercially available Excel add-in 

used to carry out Monte Carlo 

simulations. 

LCC savings and PBP are calculated 

by comparing the installed costs and 

LCC values of standards-case scenarios 

against those of base-case scenarios. The 

base-case scenario is the scenario in 

which equipment is assumed to be 

purchased by customers in the absence 

of the amended energy conservation 

standards. Standards-case scenarios are 

scenarios in which equipment is 

assumed to be purchased by customers 

after the amended energy conservation 

standards, determined as part of the 

current rulemaking, go into effect. The 

number of standards-case scenarios for 

an equipment class is equal to one less 

than the total number of efficiency 

levels in that equipment class, since 

each efficiency level above Efficiency 

Level 0 represents a potential amended 

standard. Usually, the equipment 

available in the market will have a 

distribution of efficiencies. Therefore, 

for both base-case and standards-case 

scenarios, in the LCC analysis, DOE 

assumed a distribution of efficiencies in 

the market (see section IV.F.10). 

Recognizing that each building that 

uses commercial refrigeration 

equipment is unique, DOE analyzed 

variability in the LCC and PBP results 

by performing the LCC and PBP 

calculations for seven types of 

businesses: (1) Supermarkets; (2) 

wholesaler/multi-line retail stores, such 

as ‘‘big-box stores,’’ ‘‘warehouses,’’ and 

‘‘supercenters’’; (3) convenience and 

small specialty stores, such as meat 

markets and wine, beer, and liquor 

stores; (4) convenience stores associated 

with gasoline stations; (5) full-service 

restaurants; (6) limited service 

restaurants; and (7) other foodservice 

businesses, such as caterers and 

cafeterias. Different types of businesses 

face different energy prices and also 

exhibit differing discount rates that they 

apply to purchase decisions. 

Expected equipment lifetime is 

another input whose value varies over a 

range. Therefore, DOE assumed a 

distribution of equipment lifetimes that 

are defined by Weibull survival 

functions.45

Another important factor influencing 

the LCC analysis is the State in which 

the commercial refrigeration equipment 

is installed. Inputs that vary based on 

this factor include energy prices and 

sales tax. At the national level, the 

spreadsheets explicitly modeled 

variability in the inputs for electricity 

price and markups, using probability 

distributions based on the relative 

shipments of units to different States 

and business types. 

Detailed descriptions of the 

methodology used for the LCC analysis, 

along with a discussion of inputs and 

results, are presented in chapter 8 and 

appendices 8A and 8B of the final rule 

TSD. 

1. Equipment Cost 

To calculate customer equipment 

costs, DOE multiplied the MSPs 

developed in the engineering analysis 

by the distribution channel markups, 

described in section IV.D.5. DOE 

applied baseline markups to baseline 

MSPs, and incremental markups to the 

MSP increments associated with higher 

efficiency levels. 

DOE developed an equipment price 

trend for CRE based on the inflationadjusted index of the producer price 

index (PPI) for air conditioning, 

refrigeration, and forced air heating 

from 1978 to 2012.46 A linear regression 

of the inflation-adjusted PPI shows a 

slight downward trend (see appendix 

10D of the final rule TSD). To project a 

future trend, DOE extrapolated the 

historic trend using the regression 

results. For the LCC and PBP analysis, 

this default trend was applied between 

the present and the first year of 

compliance with amended standards, 

2017. 

2. Installation Costs 

Installation cost includes labor, 

overhead, and any miscellaneous 

materials and parts needed to install the 

equipment. The installation costs may 

vary from one equipment class to 

another, but they do not vary with 

efficiency levels within an equipment 

class. DOE retained the nationally 

representative installation cost values 

from the January 2009 final rule and 

simply escalated the values from 2007$ 

to 2012$, resulting in installation costs 

of $2,299 for all remote condensing 

equipment and $862 for all selfcontained equipment. 

Hussmann opined that as equipment 

becomes more expensive, it will also 

become more difficult to install, which 

will result in higher installation labor 

costs. (Hussmann, No. 77 at p. 5) DOE 

has found no evidence to support the 

notion that higher-efficiency (and more 

expensive) commercial refrigeration 

equipment lead to an increase in 

installations costs. The installation costs 

derived for the NOPR and final rule are 

based on a detailed list of installation 

and commissioning procedures, which 

DOE believes to be representative of 

current industry practice. These 

installation and commissioning details 

can be found in chapter 8 of the final 

rule TSD. 

NAFEM asserted that DOE failed to 

take into account the ramifications of 

the proposed standard on a variety of 

end-uses, such as restaurants, grocery 

stores, and convenience stores. For 

these end-users floor space is limited, 

and increasing efficiency may increase 

the equipment size to store the same 

amount of goods. NAFEM suggests that 

increasing the thickness of foam 

insulation would decrease storage and 

display capacity of equipment and will 

likely result in a limitation of the 

products offered for sale by these users. 

(NAFEM, No. 93 at pp. 3–4) 

As described in detail in section 

IV.D.2.d of today’s rule, DOE, in its 

teardown analyses, encountered a 

number of models currently on the 

market utilizing the increased foam wall 

thicknesses which it modeled. Since 

manufacturers are already employing 

these wall thicknesses in currentlyavailable models, DOE believes that this 

serves as a proof of concept and that the 

resulting changes to form factor would 

be of minimal impact to end users. DOE 

also would like to remind stakeholders 

that it is not setting prescriptive 

standards, and should manufacturers 

value some features over others, they are 

free to use different design paths in 

order to attain the performance levels 

required by today’s rule. 

3. Maintenance and Repair Costs 

Maintenance costs are associated with 

maintaining the operation of the 

equipment. DOE split the maintenance 

costs into regular maintenance costs and 

lighting maintenance costs. Regular 

maintenance activities, which include 

cleaning evaporator and condenser 

coils, drain pans, fans, and intake 

screens; inspecting door gaskets and 

seals; lubricating hinges; and checking 


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17766 Federal Register / Vol. 79, No. 60 / Friday, March 28, 2014 / Rules and Regulations 

47U.S. Energy Information Administration. EIA– 

826 Sales and Revenue Spreadsheets. (Last 

accessed May 16, 2012). www.eia.doe.gov/cneaf/

electricity/page/eia826.html. 

48The spreadsheet tool that DOE used to conduct 

the LCC and PBP analyses allows users to select 

price forecasts from either AEO’s High Economic 

Growth or Low Economic Growth Cases. Users can 

thereby estimate the sensitivity of the LCC and PBP 

results to different energy price forecasts. 

starter panel, control, and defrost 

system operation, were considered to be 

equivalent for equipment at all 

efficiency levels. Lighting maintenance 

costs are the costs incurred to replace 

display case lighting at regular intervals 

in a preventative fashion. Because lights 

and lighting configuration change with 

efficiency levels, lighting maintenance 

costs vary with efficiency levels. As 

stated in chapter 5 of the TSD, for 

efficiency levels that incorporate LED 

lights as a design option, the expected 

reduction in LED costs beyond 2017 was 

taken into account when calculating the 

lighting maintenance costs. 

Repair cost is the cost to the customer 

of replacing or repairing failed 

components. DOE calculated repair 

costs based on the typical failure rate of 

refrigeration system components, 

original equipment manufacturer (OEM) 

cost of the components, and an assumed 

markup value to account for labor cost. 

Several stakeholders stated that DOE’s 

estimated repair and maintenance costs 

were too low. The National Restaurant 

Association commented that, in general, 

maintenance costs would be much 

higher. (NRA, No. 90 at p. 3) Hussmann 

asserted that the condensate evaporator 

pan, which is often present in selfcontained equipment, must be 

periodically cleaned and serviced, 

which increases the maintenance costs 

for such equipment, and that selfcontained equipment that utilizes 

enhanced condenser coils needs to be 

cleaned more frequently due to the 

greater density of fins on the condenser. 

(Hussmann, No. 77 at p. 4) Hussmann 

further commented that equipment 

using ECM has higher repair costs. 

(Hussmann, No. 77 at p. 5) True 

commented that fluorescent lamps in 

low temperature applications fail more 

commonly, so there is a substantial 

increase in the cost of lighting for 

freezers compared to refrigerators. LEDs 

do not have this problem. (True, Public 

Meeting Transcript, No. 62 at p. 186) 

Continental commented that smaller 

refrigeration systems have higher 

maintenance costs due to tighter 

tolerances. (Continental, Public Meeting 

Transcript, No. 62 at p. 186) 

DOE requested information from 

stakeholders regarding maintenance and 

repair costs specifically related to any of 

the design options used for this 

rulemaking. DOE believes its 

maintenance costs per linear foot are 

consistent with current industry 

practices and are sufficient to account 

for the additional time required to clean 

closely placed condenser coils and other 

considerations related to tight space. 

DOE does not believe that any design 

option used in the higher efficiency 

equipment considered in this 

rulemaking would lead to higher costs 

for regular maintenance activities. 

Therefore, DOE retained its approach of 

using the same costs for regular 

maintenance for all efficiency levels. 

However, repair costs have been 

modeled to be proportional to the OEM 

cost of the components and, 

consequently, are higher for higher 

efficiency equipment. 

4. Annual Energy Consumption 

Typical annual energy consumption 

of commercial refrigeration equipment 

at each considered efficiency level is 

obtained from the engineering analysis 

results (see chapter 5 of the final rule 

TSD). 

5. Energy Prices 

DOE calculated state average 

commercial electricity prices using the 

U.S. Energy Information 

Administration’s (EIA’s) ‘‘Database of 

Monthly Electric Utility Sales and 

Revenue Data.’’ 47 DOE calculated an 

average national commercial price by (1) 

estimating an average commercial price 

for each utility company by dividing the 

commercial revenues by commercial 

sales; and (2) weighting each utility by 

the number of commercial customers it 

served by state. 

6. Energy Price Projections 

To estimate energy prices in future 

years, DOE extrapolated the average 

state electricity prices described above 

using the forecast of annual average 

commercial electricity prices developed 

in the Reference Case from 

AEO2013.48 AEO2013 forecasted prices 

through 2040. To estimate the price 

trends after 2040, DOE assumed the 

same average annual rate of change in 

prices as from 2031 to 2040. 

7. Equipment Lifetime 

DOE defines lifetime as the age at 

which a commercial refrigeration 

equipment unit is retired from service. 

DOE based expected equipment lifetime 

on discussions with industry experts, 

and concluded that a typical lifetime of 

10 years is appropriate for most 

commercial refrigeration equipment in 

large grocery/multi-line stores and 

restaurants. Industry experts believe 

that operators of small food retail stores, 

on the other hand, tend to use CRE 

longer. In the NOPR, DOE used 15 years 

as the average equipment lifetime for 

remote condensing equipment in small 

food retail stores. DOE reflects the 

uncertainty of equipment lifetimes in 

the LCC analysis for both equipment 

markets as probability distributions, as 

discussed in section 8.2.3.5 of the final 

rule TSD. 

Several commenters responded on the 

subject of equipment lifetimes. NAFEM 

asserted that DOE had overestimated the 

lifetime of commercial refrigeration 

equipment, and suggested that DOE 

reach out to end-users and 

manufacturers for a more accurate 

estimate. (NAFEM, No. 93 at p. 7) 

Traulsen commented that commercial 

refrigeration equipment is too diverse to 

be lumped into categories of different 

lifetimes, as the lifetime of a unit 

depends on how it is used by a 

customer in each environment. Traulsen 

added that without including the time 

spent in the used equipment market, the 

estimate of equipment life is too low. 

(Traulsen, No. 65 at p. 21) The National 

Restaurant Association also commented 

that DOE’s assumption of a 10 to 15 year 

lifetime is too low. (NRA, No. 90 at p. 

3) Hussmann and Hoshizaki both 

commented that DOE’s equipment 

lifetime estimates are reasonable at 10 

and 15 years. (Hussmann, No. 77 at p. 

7) (Hoshizaki, No. 84 at p. 1) 

DOE recognizes that the lifetime of 

commercial refrigeration equipment is 

dependent on customer type and usage 

environment. In the NOPR, DOE used 

an average lifetime of 15 years for 

remote condensing equipment for small 

retail stores, and 10 years for all other 

business types. These lifetimes are the 

averages of distributions with a 

maximum lifetime of 20 and 15 years, 

respectively, for remote condensing 

equipment for small retail stores, and all 

other business types. DOE received 

comments indicating that the lifetimes 

for small businesses aside from small 

retail were too low in the NOPR, and 

that equipment used in small businesses 

of other types were likely to have 

increased lifetimes as well. DOE agrees 

with these statements, and adopted 

figures for the average and maximum 

lifetime of 15 and 20 years, respectively, 

for equipment operated by small 

businesses of all types. The equipment 

lifetimes for all other business types 

remains unchanged from the NOPR with 

an average and maximum lifetime of 10 

and 15 years, respectively. Equipment 

lifetimes are described in detail in 

chapter 8 of the TSD. 


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49The LCC analysis estimates the economic 

impact on the individual customer from that 

customer’s own economic perspective in the year of 

purchase and therefore needs to reflect that 

individual’s own perceived cost of capital. By way 

of contrast DOE’s analysis of national impact 

requires a societal discount rate. These rates used 

in that analysis are 7 percent and 3 percent, as 

required by OMB Circular A–4, September 17, 2003. 

50Harris, R.S. Applying the Capital Asset Pricing 

Model. UVA–F–1456. Available at SSRN: http://

ssrn.com/abstract=909893. 

51U.S. Energy Information Administration. 

National Energy Modeling System Commercial 

Model (2004 Version). 2004. Washington, DC. 

52The CIMS Model was originally known as the 

Canadian Integrated Modeling System, but as the 

model is now being applied to other countries, the 

acronym is now used as its proper name. 

53Energy Research Group/M.K. Jaccard & 

Associates. Integration of GHG Emission Reduction 

Options using CIMS. 2000. Vancouver, B.C. 

www.emrg.sfu.ca/media/publications/Reports%20

Continued 

8. Discount Rates 

In calculating the LCC, DOE applies 

discount rates to estimate the present 

value of future operating costs to the 

customers of commercial refrigeration 

equipment.49 DOE derived the discount 

rates for the commercial refrigeration 

equipment analysis by estimating the 

average cost of capital for a large 

number of companies similar to those 

that could purchase commercial 

refrigeration equipment. This resulted 

in a distribution of potential customer 

discount rates from which DOE sampled 

in the LCC analysis. Most companies 

use both debt and equity capital to fund 

investments, so their cost of capital is 

the weighted average of the cost to the 

company of equity and debt financing. 

DOE estimated the cost of equity 

financing by using the Capital Asset 

Pricing Model (CAPM).50 The CAPM 

assumes that the cost of equity is 

proportional to the amount of 

systematic risk associated with a 

company. 

Mercatus Center, George Mason 

University (Mercatus) commented that 

the CAPM includes the risk associated 

with a firm’s failure, but it does not 

estimate the risk associated with any 

individual item used in by the firm, nor 

does it estimate the failure risk 

associated with a particular site of 

operation. (Mercatus, No. 72 at p. 3) 

The cost of capital is commonly used 

to estimate the present value of cash 

flows to be derived from a typical 

company project or investment, and the 

CAPM is among the most widely used 

models to estimate the cost of equity 

financing. The types of risk mentioned 

by Mercatus may exist, but the cost of 

equity financing tends to be high when 

a company faces a large degree of 

systematic risk, and it tends to be low 

when the company faces a small degree 

of systematic risk. DOE’s approach 

estimates this risk for the set of 

companies that could purchase 

commercial refrigeration equipment. 

See chapter 8 of the final rule TSD for 

further discussion. 

9. Compliance Date of Standards 

EPCA requires that any amended 

standards established in this rulemaking 

must apply to equipment that is 

manufactured on or after 3 years after 

the final rule is published in the Federal 

Register unless DOE determines, by 

rule, that a 3-year period is inadequate, 

in which case DOE may extend the 

compliance date for that standard by an 

additional 2 years. (42 U.S.C. 

6313(c)(6)(C)) Based on these criteria, 

DOE assumed that the most likely 

compliance date for standards set by 

this rulemaking would be in 2017. 

Therefore, DOE calculated the LCC and 

PBP for commercial refrigeration 

equipment under the assumption that 

compliant equipment would be 

purchased in 2017. 

Continental and Lennox commented 

that an extension of compliance dates of 

the amended standards may not be 

required so long as the standards are 

based on whatever technology was 

currently available. (Continental, Public 

Meeting Transcript, No. 62 at p. 334; 

Lennox, No. 73 at p. 2) Traulsen noted 

that, should the compliance date be 

extended by a further three years, then 

it was possible, albeit unlikely, that the 

proposed standards could be realized. 

(Traulsen, No. 65 at p. 24) Providing a 

contrary view, the Joint Comment 

asserted that a three year compliance 

time period appeared feasible for the 

proposed standard. In addition, the Joint 

Comment pointed out that the initial 

statutory deadline for the final rule was 

January 2013. (Joint Comment, No. 91 at 

p. 13) Earthjustice noted that if the 

compliance date were extended, this 

may have an impact on how alternative 

refrigerants feature in the next round of 

analysis. (Earthjustice, Public Meeting 

Transcript, No. 62 at p. 334) 

In response to the inputs of 

stakeholders during the NOPR public 

meeting and in written comment, DOE 

believes that a compliance date three 

years after issuance of the final rule is 

reasonable and appropriate. A threeyear period is the standard length of 

time given between final rule issuance 

and required compliance, with 

exceptions generally being made only in 

circumstances specifically warranting 

them. Additionally, the commercial 

refrigeration industry and related 

industries have proven in the past that 

a three-year period is adequate to 

produce equipment meeting updated 

standards. Therefore, DOE is not 

including an extension of the period to 

comply with standards in today’s final 

rule document. 

In their written and verbal comments 

after publication of the NOPR, 

stakeholders noted that in ascertaining 

the compliance date for the CRE 

standards rule, DOE should take into 

account other, currently open 

rulemakings, which could affect or be 

affected by the proposed rule. True 

commented that the new timeline for 

this rulemaking, alongside the recent 

negotiated settlements regarding the 

certification of commercial equipment, 

could lead to a situation where the new 

standards could be enforced, but not the 

certification requirement. (True, Public 

Meeting Transcript, No. 62 at p. 28) 

Traulsen requested that DOE refrain 

from issuing new CRE standards until 

the CRE test procedure is finalized. 

(Traulsen, No. 65 at p. 16) The final rule 

for the CRE test procedure was issued 

prior to today’s rule for CRE standards. 

Therefore, DOE sees no conflict between 

the issuance of the two rules. 

Additionally, Structural Concepts 

commented that in order to have a 

product line ready by 2017, the design 

phase would need to start at least three 

years prior, and therefore new standards 

should only be based on existing 

technologies. (Structural Concepts, 

Public Meeting Transcript, No. 62 at p. 

72) 

DOE agrees with Structural Concepts 

that existing technologies should be the 

basis of its engineering analysis, and has 

considered only currently-available 

technologies in that analysis. 

Additionally, the three-year compliance 

period required by EPCA in most 

circumstances is consistent with the 

required length of design time suggested 

by Structural Concepts. 

10. Base-Case Efficiency Distributions 

To accurately estimate the share of 

affected customers who would likely be 

impacted by a standard at a particular 

efficiency level, DOE’s LCC analysis 

considers the projected distribution of 

efficiencies of equipment that customers 

purchase under the base case (that is, 

the case without new or amended 

energy efficiency standards). DOE refers 

to this distribution of equipment 

efficiencies as a base-case efficiency 

distribution. 

In the NOPR, DOE’s methodology to 

estimate market shares of each 

efficiency level within each equipment 

class is a cost-based method consistent 

with the approaches that were used in 

the EIA’s National Energy Modeling 

System (NEMS) 51 and in the Canadian 

Integrated Modeling System (CIMS)52 53


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17768 Federal Register / Vol. 79, No. 60 / Friday, March 28, 2014 / Rules and Regulations 

for%20Natural%20Resources%20Canada/

Rollup.pdf. 

54These classes consist of VCT.SC.M, VCT.SC.L, 

VCS.SC.M, VCS.SC.L, HCT.SC.M, HCT.SC.L, 

HCS.SC.M., and HCS.SC.L 

55U.S. Energy Information Administration. 

Annual Energy Outlook 2013. 2013. Washington, 

DC. DOE/EIA–0383(2013). 

for estimating efficiency choices within 

each equipment class. 

At the NOPR public meeting, True 

stated that 62 percent of the commercial 

refrigeration equipment sold in the 

United States is certified under 

ENERGY STAR. (True, Public Meeting 

Transcript, No. 62 at p. 302) 

For today’s final rule, DOE revised its 

approach for determining the base case 

efficiency distribution to better account 

for market data from the ENERGY STAR 

program. DOE’s understanding of the 

CRE market is that consumers of 

commercial refrigeration equipment fall 

into two categories: Those that purchase 

equipment at the lowest available first 

cost (also lowest efficiency) and those 

that purchase equipment at a somewhat 

higher first cost with higher efficiency. 

Thus, for the final rule DOE developed 

a base case efficiency distribution 

consisting of two categories: Purchases 

at the baseline and purchases at higher 

efficiency. 

For equipment classes that are 

covered by ENERGY STAR,54 DOE 

assumed that baseline equipment 

accounts for all products that are not 

ENERGY STAR certified. The ENERGY 

STAR share is divided between the 

ENERGY STAR 2.1 level and the more 

recent ENERGY STAR 3.0 level, which 

will become effective in October 2014. 

For CRE classes that are not covered by 

ENERGY STAR, DOE estimated the 

share of equipment at the baseline based 

on the output from the customer choice 

model for commercial refrigeration used 

for EIA’s Annual Energy Outlook 2013 

(AEO 2013).55 For the higher efficiency 

equipment, DOE included all efficiency 

levels for which the retail price is not 

more than 10 percent above the baseline 

price, and divided the equipment 

between the baseline and the higherefficiency market. Table IV.2 shows the 

shipment-weighted market shares by 

efficiency level in the base-case 

scenario. The method for developing the 

base-case efficiency distribution is 

explained in detail in chapter 8 of the 

final rule TSD. 

TABLE IV.2—MARKET SHARES BY EFFICIENCY LEVEL, BASE CASE IN 2017 

Equipment class 

Base-case efficiency distribution (%) 

Base EL 1 EL 2 EL 3 EL 4 EL 5 EL 6 EL 7 

VOP.RC.M ....................................................... 60 40 0 0 0 0 0 0 

VOP.RC.L ........................................................ 60 20 20 0 0 0 0 0 

VOP.SC.M ........................................................ 60 40 0 0 0 0 0 0 

VCT.RC.M ........................................................ 60 14 13 13 0 0 0 0 

VCT.RC.L ......................................................... 60 20 20 0 0 0 0 0 

VCT.SC.M ........................................................ 90 0 10 0 0 0 0 0 

VCT.SC.L ......................................................... 90 0 10 0 0 0 0 0 

VCT.SC.I .......................................................... 60 8 8 8 8 8 0 0 

VCS.SC.M ........................................................ 60 0 30 0 0 0 10 0 

VCS.SC.L ......................................................... 60 30 0 0 10 0 0 0 

VCS.SC.I .......................................................... 60 8 8 8 8 8 0 0 

SVO.RC.M ....................................................... 60 40 0 0 0 0 0 0 

SVO.SC.M ........................................................ 60 40 0 0 0 0 0 0 

SOC.RC.M ....................................................... 60 40 0 0 0 0 0 0 

SOC.SC.M ....................................................... 60 40 0 0 0 0 0 0 

HZO.RC.M ....................................................... 60 40 0 0 0 0 0 0 

HZO.RC.L ........................................................ 60 20 20 0 0 0 0 0 

HZO.SC.M ........................................................ 60 20 20 0 0 0 0 0 

HZO.SC.L ......................................................... 60 20 20 0 0 0 0 0 

HCT.SC.M ........................................................ 60 0 0 40 0 0 0 0 

HCT.SC.L ......................................................... 60 0 0 30 0 0 0 10 

HCT.SC.I .......................................................... 60 40 0 0 0 0 0 0 

HCS.SC.M ........................................................ 90 0 0 0 0 0 10 0 

HCS.SC.L ......................................................... 90 0 0 0 0 0 10 0 

PD.SC.M .......................................................... 60 40 0 0 0 0 0 0 

11. Inputs to Payback Period Analysis 

Payback period is the amount of time 

it takes the customer to recover the 

higher purchase cost of more energy 

efficient equipment as a result of lower 

operating costs. Numerically, the PBP is 

the ratio of the increase in purchase cost 

to the decrease in annual operating 

expenditures. This type of calculation is 

known as a ‘‘simple’’ PBP because it 

does not take into account changes in 

operating cost over time or the time 

value of money; that is, the calculation 

is done at an effective discount rate of 

zero percent. PBPs are expressed in 

years. PBPs greater than the life of the 

equipment mean that the increased total 

installed cost of the more-efficient 

equipment is not recovered in reduced 

operating costs over the life of the 

equipment. 

The inputs to the PBP calculation are 

the total installed cost to the customer 

of the equipment for each efficiency 

level and the average annual operating 

expenditures for each efficiency level in 

the first year. The PBP calculation uses 

the same inputs as the LCC analysis, 

except that electricity price trends and 

discount rates are not used. 

12. Rebuttable-Presumption Payback 

Period 

Sections 325(o)(2)(B)(iii) and 

345(e)(1)(A) of EPCA, (42 U.S.C. 

6295(o)(2)(B)(iii) and 42 U.S.C. 

6316(e)(1)(A)), establish a rebuttable 

presumption applicable to commercial 

refrigeration equipment. The rebuttable 

presumption states that a new or 

amended standard is economically 

justified if the 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 times the value 


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Federal Register / Vol. 79, No. 60 / Friday, March 28, 2014 / Rules and Regulations 17769 

56Freedonia Group, Inc. Commercial 

Refrigeration Equipment to 2014. 2010. Cleveland, 

OH. Study 2261. www.freedoniagroup.com/

Commercial-Refrigeration-Equipment.html. 

57North American Association of Food 

Equipment Manufacturers. 2008 Size and Shape of 

Industry. 2008. Chicago, IL. 

58North American Association of Food 

Equipment Manufacturers. 20012 Size and Shape of 

Industry. 2012. Chicago, IL. 

59Navigant Consulting, Inc. Energy Savings 

Potential and R&D Opportunities for Commercial 

Refrigeration. 2009. Prepared by Navigant 

Consulting, Inc. for the U.S. Department of Energy, 

Washington, DC. 

of the energy savings during the first 

year that the consumer will receive as 

a result of the standard, as calculated 

under the applicable test procedure. 

This rebuttable presumption test is an 

alternative way of establishing 

economic justification. 

To evaluate the rebuttable 

presumption, DOE estimated the 

additional cost of purchasing moreefficient, standards-compliant 

equipment, and compared this cost to 

the value of the energy saved during the 

first year of operation of the equipment. 

DOE interprets that the increased cost of 

purchasing standards-compliant 

equipment includes the cost of 

installing the equipment for use by the 

purchaser. DOE calculated the 

rebuttable presumption PBP, or the ratio 

of the value of the increased installed 

price above the baseline efficiency level 

to the first year’s energy cost savings. 

When the rebuttable presumption PBP 

is less than 3 years, the rebuttable 

presumption is satisfied; when the 

rebuttable presumption PBP is equal to 

or more than 3 years, the rebuttable 

presumption is not satisfied. Note that 

this PBP calculation does not include 

other components of the annual 

operating cost of the equipment (i.e., 

maintenance costs and repair costs). 

While DOE examined the rebuttable 

presumption, it also considered whether 

the standard levels considered are 

economically justified through a more 

detailed analysis of the economic 

impacts of these levels pursuant to 42 

U.S.C. 6295(o)(2)(B)(i). The results of 

this analysis served as the basis for DOE 

to evaluate the economic justification 

for a potential standard level 

definitively (thereby supporting or 

rebutting the results of any preliminary 

determination of economic 

justification). 

G. Shipments 

Complete historical shipments data 

for commercial refrigeration equipment 

could not be obtained from any one 

single source. Therefore, for the NOPR 

DOE used data from multiple sources to 

estimate historical shipments. The 

major sources were 2005 shipments data 

provided by ARI as part of its comments 

submitted in response to the January 

2009 final rule Framework document, 

ARI 2005 Report (Docket No. EERE– 

2006–BT–STD–0126, ARI, No. 7, Exhibit 

B at p. 1); Commercial Refrigeration 

Equipment to 2014 by Freedonia Group, 

Inc.56; 2008, and 2012 Size and Shape 

of Industry by the North American 

Association of Food Equipment 

Manufacturers; 57 58 and Energy Savings 

Potential and R&D Opportunities for 

Commercial Refrigeration prepared by 

Navigant Consulting, Inc. for DOE.59

Historical linear feet of shipped units 

is the figure used to depict the annual 

amount of commercial refrigeration 

equipment capacity shipped, and is an 

alternative way to express shipments 

data. DOE determined the linear feet 

shipped for any given year by 

multiplying each unit shipped by its 

associated average length, and then 

summing all the linear footage values. 

Chapter 9 of the final rule TSD presents 

the representative equipment class 

lengths used for the conversion of perunit shipments to linear footage within 

each equipment class. 

DOE divided historical annual 

shipments into new and replacement 

categories by building type. First, 

equipment types were identified by the 

type of business they generally serve. 

For example, vertical open cases with 

remote condensing units are associated 

with large grocers and multi-line retail 

stores. When there was no strong 

association between the building type 

and equipment class, equipment was 

distributed across broader building 

types. Second, a ratio of new versus 

replacement equipment was developed 

based on commercial floor space 

estimates. Using the expected useful life 

of commercial refrigeration equipment 

and commercial floor space stock, 

additions, and retirements, ratios were 

developed of new versus replacement 

stock. Using these and related factors 

(e.g., the division of foodservice into the 

three building types—limited service 

restaurants, full-service restaurants, and 

other), DOE distributed commercial 

refrigeration equipment shipments 

among building types and new versus 

replacement shipments. 

DOE then estimated the annual linear 

footage shipped for each of the 25 

primary equipment classes used to 

represent the commercial refrigeration 

equipment market. The fractions shown 

in Table IV.3 were held constant over 

the analysis period. 

TABLE IV.3—PERCENT OF SHIPPED

LINEAR FEET OF COMMERCIAL REFRIGERATION EQUIPMENT

Equipment class 

Percentage of 

linear feet 

shipped * 

VOP.RC.M ............................ 10.3 

VOP.RC.L ............................. 0.5 

VOP.SC.M ............................ 1.3 

VCT.RC.M ............................ 0.8 

VCT.RC.L ............................. 10.7 

VCT.SC.M ............................. 4.8 

VCT.SC.L .............................. 0.2 

VCT.SC.I ............................... 0.3 

VCS.SC.M ............................ 25.4 

VCS.SC.L ............................. 15.0 

VCS.SC.I .............................. 0.1 

SVO.RC.M ............................ 8.2 

SVO.SC.M ............................ 1.1 

SOC.RC.M ............................ 2.1 

SOC.SC.M ............................ 0.2 

HZO.RC.M ............................ 1.3 

HZO.RC.L ............................. 4.0 

HZO.SC.M ............................ 0.1 

HZO.SC.L ............................. 0.2 

HCT.SC.M ............................ 0.1 

HCT.SC.L ............................. 0.4 

HCT.SC.I .............................. 0.4 

HCS.SC.M ............................ 4.4 

HCS.SC.L ............................. 0.6 

PD.SC.M ............................... 7.6 

* The percentages in this column do not 

sum to 100 percent because shipments of 

secondary equipment classes and certain 

other equipment classes that were not analyzed in this rulemaking were not included. 

The amount of new and existing 

commercial floor space is the main 

driver for future commercial 

refrigeration equipment shipments. The 

model divides commercial floor space 

into new construction floor space and 

existing floor space. 

DOE projected square footage of new 

construction as a driver of CRE demand 

to scale annual new commercial 

refrigeration equipment shipments. DOE 

took the projected floor space 

construction after the year 2009 from 

the NEMS projection underlying AEO 

2013. The new construction growth 

rates over the last 10 years of the AEO 

2013 forecast (2031 through 2040) were 

used to extend the AEO forecast out 

until 2046 to develop the full 30-year 

forecast needed for the NIA. 

True stated during the NOPR public 

meeting that DOE’s shipments estimates 

for the VCT.SC.M equipment class were 

20 to 30 percent of actual shipments. 

(True, Public Meeting Transcript, No. 62 

at pp. 240–242) This statement was 

supported by Coca-Cola, which asserted 

that it alone purchased 180,000 linear 

feet of VCT.SC.M equipment 

domestically compared to the 155,000 

linear feet of VCT.SC.M equipment 

presented in the NOPR. (Coca-Cola, 

Public Meeting Transcript, No. 62 at p. 


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17770 Federal Register / Vol. 79, No. 60 / Friday, March 28, 2014 / Rules and Regulations 

60Energy Star. Unit Shipment and Sales Data 

Archives. Available at: http://www.energystar.gov/

index.cfm?c=partners.unit_shipment_data_archives 

(Last accessed 12/5/2013). 

61North American Association of Food 

Equipment Manufacturers. 2012 Size and Shape of 

Industry. 2012. Chicago, IL. 

242) True followed up its public 

meeting statements with written 

comment stating that its estimate of the 

self-contained market was four to six 

times larger than what was stated in the 

proposed rule. (True, No. 76 at p. 1) 

Traulsen suggested that DOE use newer 

data, such as those in the NAFEM 2012 

‘‘Size and Shape of the Industry’’ study 

to improve the accuracy of its shipments 

analysis. (Traulsen, No. 65 at p. 15) 

Although neither True nor Coca-Cola 

provided DOE with shipments data to 

support their assertions, the magnitude 

of the discrepancy in shipments 

identified by these comments led DOE 

to revise its shipments estimates for the 

final rule. DOE reviewed three sources 

of data in developing the revision. First, 

DOE reviewed the most recent data 

published by the EPA’s ENERGY STAR 

Program.60 These EPA data include both 

an estimate of total units shipped, and 

an estimate of the fraction that are 

ENERGY STAR compliant, from 2003 to 

2012. The ENERGY STAR estimates of 

total unit shipments show somewhat 

slow growth from 2003 to 2010, and a 

significant increase between 2010 and 

2011, with shipments increasing by a 

factor of two. Second, DOE reviewed the 

most recent North American 

Association of Food Equipment 

Manufacturers Size and Shape of the 

Industry 61 report published in 2012. 

This report provides industry total 

estimates of sales in dollar values. These 

data show an increase of approximately 

60 percent in sales of the relevant 

covered equipment between 2008 and 

2011. Third, DOE reviewed equipment 

saturation estimates calculated from 

data in the Energy Information Agency’s 

(EIA) Commercial Buildings Energy 

Consumption Survey (CBECS) for 1999 

and 2003. The CBECS surveys include 

a count of the number of refrigerated 

cases in a building, which was be 

converted to a saturation value that 

represents the average number of cases 

per building. These data indicate a 

growth in saturation between 1999 and 

2003, particularly for closed 

refrigeration cases. The existence of a 

trend in equipment saturations was not 

accounted for in the NOPR analyses. 

Taken together, all three data sources 

support the claims made by 

stakeholders that DOE’s shipments 

published in the NOPR were 

substantially underestimated. 

For the final rule, DOE modified the 

shipments analysis to include a trend in 

equipment saturations between 2003 

and 2012. The trend was calculated by 

(1) smoothing the growth in shipments 

in the ENERGY STAR data to a constant 

annual growth rate, (2) correcting to 

account for the growth in total new and 

existing commercial floor space, and (3) 

applying the resulting trend in 

saturations for the years 2004 to 2012. 

Before 2003 and after 2012 equipment 

saturations are held constant. The net 

result is a doubling of equipment 

saturations between 2003 and 2012, 

with corresponding increases in the 

shipments estimates, which are 

generally consistent in magnitude with 

stakeholder comments. These 

corrections were applied uniformly to 

all equipment types and applications, 

and thus do not affect the distribution 

of equipment by building type or by 

equipment class. 

Detailed description of the procedure 

to calculate future shipments is 

presented in chapter 9 of the final rule 

TSD. 

1. Impact of Standards on Shipments 

Several stakeholders stated that 

customer purchase behavior would 

change in response to an increase in 

equipment prices due to more stringent 

standards. At the NOPR public meeting, 

Hussmann commented that it had 

noticed a shift from the open VOP.RC.M 

to the closed VCT.RC.M equipment 

class, possibly due to energy savings 

being valued by customers (primarily 

supermarkets). (Hussmann, Public 

Meeting Transcript, No. 62 at pp. 236– 

37) However, Hussmann noted that the 

shift could be reversed if closed 

equipment diminished in its utility as a 

merchandising platform. (Hussmann, 

Public Meeting Transcript, No. 62 at p. 

237) Hillphoenix and Danfoss stated 

that if standards require the use of 

triple-pane coated glass, reduction in 

visibility will result in users shifting 

back to less-efficient open cases. 

(Danfoss, No. 61 at p. 4; Hillphoenix, 

No. 71 at p. 2) Hussmann noted that it 

had not observed a reversal of the trend 

toward closed units in response to 

previous efficiency standards. 

(Hussmann, Public Meeting Transcript, 

No. 62 at p. 235) 

DOE recognizes that increased cost for 

closed equipment meeting the amended 

standards in today’s final rule has the 

potential to influence a shift from more 

efficient closed equipment to open 

equipment. However, DOE did not have 

sufficient information on customer 

behavior to model the degree of such 

equipment switching as part of the NIA. 

Further, DOE has concluded that the 

amended standards in today’s final rule 

will not diminish the utility of 

commercial refrigeration equipment, 

and they do not require triple-pane 

coated glass. 

Several stakeholders commented that, 

in response to a possible price increase 

due to standards, CRE customers may 

prolong the life of existing equipment 

through refurbishment. Danfoss asserted 

that a 15 to 20 percent increase in prices 

will reduce demand for new units and 

increase sales of used of refurbished 

units. (Danfoss, No. 61 at p. 3) NAFEM 

commented that any standard where the 

payback on new equipment is longer 

than 2 years will likely steer users into 

the refurbished market. (NAFEM, No. 93 

at pp. 7–8) Traulsen commented that the 

impact of refurbishing equipment was 

not fully represented by DOE, especially 

in the small business environment 

where customers are likely to hold onto 

equipment longer. (Traulsen, No. 65 at 

p. 19) Hussmann stated that due to price 

increases resulting from higher 

efficiency, the refurbishment of old 

equipment will reduce the market for 

new equipment. (Hussmann, No. 77 at 

p. 5) 

DOE acknowledges that increases in 

price due to amended standards could 

lead to more refurbishing of equipment 

(or purchase of used equipment), which 

would have the effect of deferring the 

shipment of new equipment for a period 

of time. DOE did not have enough 

information on CRE customer behavior 

to explicitly model the extent of 

refurbishing at each TSL. However, DOE 

believes that the extent of refurbishing 

would not be so significant as to change 

the ranking of the TSLs considered for 

today’s rule. 

H. National Impact Analysis—National 

Energy Savings and Net Present Value 

The NIA assesses the NES and the 

NPV of total customer costs and savings 

that would be expected as a result of 

amended energy conservation 

standards. The NES and NPV are 

analyzed at specific efficiency levels for 

each equipment class of commercial 

refrigeration equipment. DOE calculates 

the NES and NPV based on projections 

of annual equipment shipments, along 

with the annual energy consumption 

and total installed cost data from the 

LCC analysis. For the final rule analysis, 

DOE forecasted the energy savings, 

operating cost savings, equipment costs, 

and NPV of customer benefits over the 

lifetime of equipment sold from 2017 

through 2046. 

DOE evaluated the impacts of the 

amended standards by comparing basecase projections with standards-case 

projections. The base-case projections 


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Federal Register / Vol. 79, No. 60 / Friday, March 28, 2014 / Rules and Regulations 17771 

characterize energy use and customer 

costs for each equipment class in the 

absence of any amended energy 

conservation standards. DOE compares 

these projections with projections 

characterizing the market for each 

equipment class if DOE were to adopt 

an amended standard at specific energy 

efficiency levels for that equipment 

class. 

DOE uses a Microsoft Excel 

spreadsheet model to calculate the 

energy savings and the national 

customer costs and savings from each 

TSL. The final rule TSD and other 

documentation that DOE provides 

during the rulemaking help explain the 

models and how to use them, and 

interested parties can review DOE’s 

analyses by interacting with these 

spreadsheets. The NIA spreadsheet 

model uses average values as inputs (as 

opposed to probability distributions of 

key input parameters from a set of 

possible values). 

For the final rule analysis, the NIA 

used projections of energy prices and 

commercial building starts from the 

AEO2013 Reference Case. In addition, 

DOE analyzed scenarios that used 

inputs from the AEO2013 Low 

Economic Growth and High Economic 

Growth Cases. These cases have lower 

and higher energy price trends, 

respectively, compared to the Reference 

Case. NIA results based on these cases 

are presented in appendix 10D of the 

final rule TSD. 

A detailed description of the 

procedure to calculate NES and NPV, 

and inputs for this analysis are provided 

in chapter 10 of the final rule TSD. 

1. Forecasted Efficiency in the Base Case 

and Standards Cases 

The method for estimating the market 

share distribution of efficiency levels is 

presented in section IV.F.10, and a 

detailed description can be found in 

chapter 8 of the final rule TSD. 

As discussed in section IV.F.10 of 

today’s rule, DOE revised the 

distribution of equipment efficiencies in 

the base case to better account for data 

from ENERGY STAR. For equipment 

covered by ENERGY STAR, for the NIA 

DOE estimated that the market will 

move over time to adopt higher 

efficiency ENERGY STAR rated 

equipment. DOE estimated that for 

equipment not covered by ENERGY 

STAR, there is limited market demand 

for higher efficiency equipment, and the 

base case efficiency distribution would 

not change over time. 

To estimate market behavior in the 

standards cases, DOE uses a ‘‘roll-up’’ 

scenario. Under the roll-up scenario, 

DOE assumes that equipment 

efficiencies in the base case that do not 

meet the standard level under 

consideration would ‘‘roll up’’ to meet 

the new standard level, and equipment 

efficiencies above the standard level 

under consideration would be 

unaffected. 

To project trends in standards-case 

efficiency after the initial shift in the 

compliance year, DOE used the same 

assumptions as in the base case for 

equipment covered or not covered by 

ENERGY STAR. 

The estimated efficiency trends in the 

base case and standards cases are 

further described in chapter 8 of the 

final rule TSD. 

2. National Energy Savings 

For each year in the forecast period, 

DOE calculates the NES for each 

potential standard level by multiplying 

the stock of equipment affected by the 

energy conservation standards by the 

estimated per-unit annual energy 

savings. DOE typically considers the 

impact of a rebound effect in its 

calculation of NES for a given product. 

A rebound effect occurs when users 

operate higher efficiency equipment 

more frequently and/or for longer 

durations, thus offsetting estimated 

energy savings. DOE did not incorporate 

a rebound factor for commercial 

refrigeration equipment because it is 

operated 24 hours a day, and therefore 

there is no potential for a rebound 

effect. 

Major inputs to the calculation of NES 

are annual unit energy consumption, 

shipments, equipment stock, a site-toprimary energy conversion factor, and a 

full fuel cycle factor. 

The annual unit energy consumption 

is the site energy consumed by a 

commercial refrigeration unit in a given 

year. Because the equipment classes 

analyzed represent equipment sold 

across a range of sizes, DOE’s ‘‘unit’’ in 

the NES is actually expressed as a linear 

foot of equipment in an equipment 

class, and not an individual unit of 

commercial refrigeration equipment of a 

specific size. DOE determined annual 

forecasted shipment-weighted average 

equipment efficiencies that, in turn, 

enabled determination of shipmentweighted annual energy consumption 

values. 

The NES spreadsheet model keeps 

track of the total linear footage of 

commercial refrigeration units shipped 

each year. The commercial refrigeration 

equipment stock in a given year is the 

total linear footage of commercial 

refrigeration equipment shipped from 

earlier years that is still in use in that 

year, based on the equipment lifetime. 

To estimate the national energy 

savings expected from energy 

conservation standards, DOE uses a 

multiplicative factor to convert site 

energy consumption (energy use at the 

location where the appliance is 

operated) into primary or source energy 

consumption (the energy required to 

deliver the site energy). For today’s final 

rule, DOE used conversion factors based 

on AEO 2013. For electricity, the 

conversion factors vary over time 

because of projected changes in 

generation sources (i.e., the types of 

power plants projected to provide 

electricity to the country). Because the 

AEO does not provide energy forecasts 

beyond 2040, DOE used conversion 

factors that remain constant at the 2040 

values throughout the rest of the 

forecast. 

DOE has historically presented NES 

in terms of primary energy savings. In 

response to the recommendations of a 

committee on ‘‘Point-of-Use and FullFuel-Cycle Measurement Approaches to 

Energy Efficiency Standards’’ appointed 

by the National Academy of Science, 

DOE announced its intention to use fullfuel-cycle (FFC) measures of energy use 

and greenhouse gas and other emissions 

in the national impact analyses and 

emissions analyses included in future 

energy conservation standards 

rulemakings. 76 FR 51281 (August 18, 

2011) While DOE stated in that 

document that it intended to use the 

Greenhouse Gases, Regulated Emissions, 

and Energy Use in Transportation 

(GREET) model to conduct the analysis, 

it also said it would review alternative 

methods, including the use of NEMS. 

After evaluating both models and the 

approaches discussed in the August 18, 

2011 document, DOE published a 

statement of amended policy in the 

Federal Register in which DOE 

explained its determination that NEMS 

is a more appropriate tool for its FFC 

analysis and its intention to use NEMS 

for that purpose. 77 FR 49701 (August 

17, 2012). 

The approach used for today’s final 

rule, and the FFC multipliers that were 

applied, are described in appendix 10D 

of the final rule TSD. NES results are 

presented in both primary energy and 

FFC savings in section V.B.3.a. 

3. Net Present Value of Customer 

Benefit 

The inputs for determining the NPV 

of the total costs and benefits 

experienced by customers of the 

commercial refrigeration equipment are: 

(1) Total annual installed cost; (2) total 

annual savings in operating costs; and 

(3) a discount factor. DOE calculated net 

national customer savings for each year 


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as the difference between the base-case 

scenario and standards-case scenarios in 

terms of installation and operating costs. 

DOE calculated operating cost savings 

over the life of each piece of equipment 

shipped in the forecast period. 

As discussed in section IV.F.1, DOE 

developed an equipment price trend for 

commercial refrigeration equipment 

based on the inflation-adjusted index of 

the PPI for air conditioning, 

refrigeration, and forced air heating 

from 1978 to 2012. A linear regression 

of the inflation-adjusted PPI shows a 

slight downward trend (see appendix 

10D of the final rule TSD). To project a 

future trend over the analysis period, 

DOE extrapolated the historic trend 

using the regression results. 

DOE multiplied monetary values in 

future years by the discount factor to 

determine the present value of costs and 

savings. DOE estimated national 

impacts using both a 3-percent and a 7- 

percent real discount rate as the average 

real rate of return on private investment 

in the U.S. economy. These discount 

rates are used in accordance with the 

Office of Management and Budget 

(OMB) guidance to Federal agencies on 

the development of regulatory analysis 

(OMB Circular A–4, September 17, 

2003), and section E, ‘‘Identifying and 

Measuring Benefits and Costs,’’ therein. 

The 7-percent rate is an estimate of the 

average before-tax rate of return on 

private capital in the U.S. economy, and 

reflects the returns on real estate and 

small business capital, including 

corporate capital. DOE used this 

discount rate to approximate the 

opportunity cost of capital in the private 

sector because recent OMB analysis has 

found the average rate of return on 

capital to be near this rate. In addition, 

DOE used the 3-percent rate to capture 

the potential effects of amended 

standards on private consumption. This 

rate represents the rate at which society 

discounts future consumption flows to 

their present value. It can be 

approximated by the real rate of return 

on long-term government debt (i.e., 

yield on Treasury notes minus annual 

rate of change in the Consumer Price 

Index), which has averaged about 3 

percent on a pre-tax basis for the last 30 

years. DOE defined the present year as 

2014 for the analysis. 

I. Customer Subgroup Analysis 

In analyzing the potential impact of 

new or amended standards on 

commercial customers, DOE evaluates 

the impact on identifiable groups (i.e., 

subgroups) of customers, such as 

different types of businesses that may be 

disproportionately affected. Small 

businesses typically face higher cost of 

capital. In general, the higher the cost of 

capital, the more likely it is that an 

entity would be disadvantaged by a 

requirement to purchase higher 

efficiency equipment. Based on data 

from the 2007 U.S. Economic Census 

and size standards set by the U.S. Small 

Business Administration (SBA), DOE 

determined that a majority of small 

grocery and convenience stores and 

restaurants fall under the definition of 

small businesses. 

Comparing the small grocery and 

convenience store category to the 

convenience store with gas station 

category, both face the same cost of 

capital, but convenience stores with gas 

stations generally incur lower electricity 

prices, which would tend to render 

higher-efficiency equipment not costeffective. To examine a ‘‘worst case’’ 

situation, convenience stores with gas 

stations were chosen for the subgroup 

analysis. Limited-service restaurants 

and full-service restaurants have similar 

electricity price and discount rates. DOE 

chose to study full-service restaurants 

for the subgroup analysis because a 

higher percentage of full-service 

restaurants tend to be operated by 

independent small businesses, as 

compared to limited-service (fast-food) 

restaurants. DOE believes that these two 

subgroups are broadly representative of 

small businesses that use CRE. 

DOE estimated the impact on the 

identified customer subgroups using the 

LCC spreadsheet model. The input for 

business type was fixed to the identified 

subgroup, which ensured that the 

discount rates and electricity prices 

associated with only that subgroup were 

selected in the Monte Carlo simulations. 

The discount rate was further increased 

by applying the small firm premium to 

the WACC. In addition, DOE assumed 

that the subgroups do not have access to 

national purchasing accounts and, 

consequently, face a higher distribution 

channel markup. Apart from these 

changes, all other inputs for the 

subgroup analysis are the same as those 

in the LCC analysis. Details of the data 

used for the subgroup analysis and 

results are presented in chapter 11 of 

the final rule TSD. 

The Society of American Florists 

stated that the percent of refrigerated 

product sold at retail by florists is 

higher than in other retail industries 

and that they would be particularly 

sensitive to an increase in equipment 

price. (SAF, No. 74 at p. 3) SAF 

suggested that DOE should conduct 

analyses for floriculture growers, 

wholesalers, and retail florists to 

determine the impact of amended 

standards on these end-users. (SAF, No. 

74 at p. 7) 

While the subgroups considered by 

DOE do not exactly correspond to 

florist-related businesses, DOE believes 

that the impacts experienced by the 

selected subgroups are indicative of the 

impacts that would be experienced by 

florist-related businesses. Thus, the 

analyses suggested by SAF are not 

warranted. 

The National Restaurant Association 

suggested that DOE re-analyze the small 

business subgroups based on more 

accurate costs and equipment lifetime 

assumptions. (NRA, No. 90 at p. 2) DOE 

has used the best available data to 

estimate equipment costs and lifetime 

for the considered subgroups, so there 

would be no basis for re-analysis. 

Mercatus stated that 26 percent of 

restaurants fail in their first year and by 

year three the rate of failure is just over 

60 percent; therefore, it is not rational 

for these types of customers to purchase 

more efficient equipment before 

realizing a net benefit. (Mercatus, No. 72 

at p. 3) DOE acknowledges that some 

CRE units may outlive the particular 

business that purchased them new, but 

the customer that purchases the used 

equipment would see the energy cost 

benefits of higher-efficiency equipment. 

Several parties stated that higher 

equipment costs will induce small 

businesses to purchase used or 

refurbished equipment. The National 

Restaurant Association commented that 

an equipment cost increase of 15 to 20 

percent will force small restaurants to 

purchase used or refurbished 

equipment. (NRA, No. 90 at p. 3) The 

Air Conditioning Contractors of 

America (ACCA) commented that small 

consumers would elect to extend the life 

of existing equipment rather than 

purchase new more expensive 

equipment. (ACCA, Public Meeting 

Transcript, No. 62 at pp. 343–44) True 

commented that individually owned 

restaurants would elect to purchase 

used equipment due to lower first cost 

instead of purchasing new, more 

efficient equipment. (True, Public 

Meeting Transcript, No. 62 at p. 208) 

Traulsen opined that smaller entities are 

more likely to keep existing equipment 

longer, and will be negatively affected 

by the proposed standard. (Traulsen, 

No. 65 at p. 19) Hoshizaki commented 

that the proposed standards will 

increase costs and deter small business 

owners from buying new equipment. 

(Hoshizaki, No. 84 at p. 1) 

DOE acknowledges that some small 

businesses may respond to amended 

CRE standards by purchasing used or 

refurbished equipment. However, as 

discussed in section V.B.1.b, DOE did 

not have sufficient information to 

evaluate the likely extent of this 


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response. The consumer subgroup 

results (shown in section V.B.1.b of this 

document) indicate that in nearly all 

cases the considered small business 

subgroups see higher average LCC 

savings and lower median payback 

periods when compared to all CRE 

customers. These results suggest that 

most small businesses would find it 

beneficial to purchase new commercial 

refrigeration equipment that meets 

today’s standards. 

J. Manufacturer Impact Analysis 

1. Overview 

DOE performed a MIA to estimate the 

financial impact of amended energy 

conservation standards on 

manufacturers of commercial 

refrigeration equipment and to 

understand the impact of such 

standards on employment and 

manufacturing capacity. The MIA has 

both quantitative and qualitative 

aspects. The quantitative part of the 

MIA primarily relies on the Government 

Regulatory Impact Model (GRIM), an 

industry cash-flow model with inputs 

specific to this rulemaking. The key 

GRIM inputs are data on the industry 

cost structure, product costs, shipments, 

and assumptions about markups and 

conversion expenditures. The key 

output is the INPV. Different sets of 

markup scenarios will produce different 

results. The qualitative part of the MIA 

addresses factors such as equipment 

characteristics, impacts on particular 

subgroups of manufacturers, and 

important market and product trends. 

The complete MIA is outlined in 

chapter 12 of the final rule TSD. 

DOE conducted the MIA for this 

rulemaking in three phases. In Phase 1 

of the MIA, DOE prepared a profile of 

the commercial refrigeration equipment 

industry that includes a top-down cost 

analysis of manufacturers used to derive 

preliminary financial inputs for the 

GRIM (e.g., sales general and 

administration (SG&A) expenses; 

research and development (R&D) 

expenses; and tax rates). DOE used 

public sources of information, including 

company SEC 10–K filings, corporate 

annual reports, the U.S. Census 

Bureau’s Economic Census, and 

Hoover’s reports. 

In Phase 2 of the MIA, DOE prepared 

an industry cash-flow analysis to 

quantify the impacts of an amended 

energy conservation standard. In 

general, more-stringent energy 

conservation standards can affect 

manufacturer cash flow in three distinct 

ways: (1) By creating a need for 

increased investment; (2) by raising 

production costs per unit; and (3) by 

altering revenue due to higher per-unit 

prices and possible changes in sales 

volumes. 

In Phase 3 of the MIA, DOE 

conducted structured, detailed 

interviews with a representative crosssection of manufacturers. During these 

interviews, DOE discussed engineering, 

manufacturing, procurement, and 

financial topics to validate assumptions 

used in the GRIM and to identify key 

issues or concerns. 

Additionally, in Phase 3, DOE 

evaluated subgroups of manufacturers 

that may be disproportionately 

impacted by amended standards, or that 

may not be accurately represented by 

the average cost assumptions used to 

develop the industry cash-flow analysis. 

For example, small manufacturers, 

niche players, or manufacturers 

exhibiting a cost structure that largely 

differs from the industry average could 

be more negatively affected. 

DOE identified one subgroup, small 

manufacturers, for separate impact 

analyses. DOE applied the small 

business size standards published by 

the SBA to determine whether a 

company is considered a small business. 

65 FR 30836, 30848 (May 15, 2000), as 

amended at 65 FR 53533, 53544 

(September 5, 2000) and codified at 13 

CFR part 121. To be categorized as a 

small business under North American 

Industry Classification System (NAICS) 

333415, ‘‘Air-Conditioning and Warm 

Air Heating Equipment and Commercial 

and Industrial Refrigeration Equipment 

Manufacturing,’’ a commercial 

refrigeration manufacturer and its 

affiliates may employ a maximum of 

750 employees. The 750-employee 

threshold includes all employees in a 

business’s parent company and any 

other subsidiaries. Based on this 

classification, DOE identified at least 32 

commercial refrigeration equipment 

manufacturers that qualify as small 

businesses. The commercial 

refrigeration equipment small 

manufacturer subgroup is discussed in 

chapter 12 of the final rule TSD and in 

section I.A.1 of this document. 

2. Government Regulatory Impact Model 

DOE uses the GRIM to quantify the 

changes in the commercial refrigeration 

equipment industry cash flow due to 

amended standards that result in a 

higher or lower industry value. The 

GRIM analysis uses a standard, annual 

cash-flow analysis that incorporates 

manufacturer costs, markups, 

shipments, and industry financial 

information as inputs, and models 

changes in costs, investments, and 

manufacturer margins that would result 

from new and amended energy 

conservation standards. The GRIM 

spreadsheet uses the inputs to arrive at 

a series of annual cash flows, beginning 

with the base year of the analysis, 2013 

in this case, and continuing to 2046. 

DOE calculated INPVs by summing the 

stream of annual discounted cash flows 

during this period. For commercial 

refrigeration equipment manufacturers, 

DOE used a real discount rate of 10 

percent. DOE’s discount rate estimate 

was derived from industry financials 

and then modified according to 

feedback during manufacturer 

interviews. 

The GRIM calculates cash flows using 

standard accounting principles and 

compares changes in INPV between a 

base case and various TSLs (the 

standards cases). The difference in INPV 

between the base case and a standards 

case represents the financial impact of 

the amended standard on 

manufacturers. As discussed previously, 

DOE collected the information on the 

critical GRIM inputs from a number of 

sources, including publicly available 

data and interviews with a number of 

manufacturers (described in the next 

section). The GRIM results are shown in 

section V.B.2.a. Additional details about 

the GRIM can be found in chapter 12 of 

the final rule TSD. 

a. Government Regulatory Impact Model 

Key Inputs 

Manufacturer Production Costs 

Manufacturing a higher efficiency 

product is typically more expensive 

than manufacturing a baseline product 

due to the use of more complex 

components, which are more costly than 

baseline components. The changes in 

the MPCs of the analyzed products can 

affect the revenues, gross margins, and 

cash flow of the industry, making these 

product cost data key GRIM inputs for 

DOE’s analysis. 

In the MIA, DOE used the MPCs for 

each considered efficiency level 

calculated in the engineering analysis, 

as described in section IV.B and further 

detailed in chapter 5 of the NOPR TSD. 

In addition, DOE used information from 

its teardown analysis, described in 

section IV.D.4.a, to disaggregate the 

MPCs into material, labor, and overhead 

costs. To calculate the MPCs for 

equipment above the baseline, DOE 

added incremental material, labor, 

overhead costs from the engineering 

cost-efficiency curves to the baseline 

MPCs. These cost breakdowns and 

equipment markups were validated with 

manufacturers during manufacturer 

interviews. 


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Base-Case Shipments Forecast 

The GRIM estimates manufacturer 

revenues based on total unit shipment 

forecasts and the distribution of these 

values by efficiency level. Changes in 

sales volumes and efficiency mix over 

time can significantly affect 

manufacturer finances. For this analysis, 

the GRIM uses the NIA’s annual 

shipment forecasts derived from the 

shipments analysis from 2013, the base 

year, to 2046, the end of the analysis 

period. See chapter 9 of the final rule 

TSD for additional details. 

Product and Capital Conversion Costs 

Amended energy conservation 

standards will cause manufacturers to 

incur conversion costs to bring their 

production facilities and product 

designs into compliance. For the MIA, 

DOE classified these conversion costs 

into two major groups: (1) Product 

conversion costs and (2) capital 

conversion costs. Product conversion 

costs are investments in research, 

development, testing, marketing, and 

other non-capitalized costs necessary to 

make product designs comply with a 

new or amended energy conservation 

standard. Capital conversion costs are 

investments in property, plant, and 

equipment necessary to adapt or change 

existing production facilities such that 

new product designs can be fabricated 

and assembled. 

To evaluate the level of capital 

conversion expenditures manufacturers 

would likely incur to comply with 

amended energy conservation 

standards, DOE used manufacturer 

interviews to gather data on the level of 

capital investment required at each 

efficiency level. DOE validated 

manufacturer comments through 

estimates of capital expenditure 

requirements derived from the product 

teardown analysis and engineering 

model described in section IV.D.4. 

Further adjustments were made to 

capital conversion costs based on 

feedback in the NOPR written 

comments. The key driver of capital 

conversion costs was new production 

equipment associated with improving 

cabinet insulation. 

DOE assessed the product conversion 

costs at each level by integrating data 

from quantitative and qualitative 

sources. DOE considered feedback 

regarding the potential costs of each 

efficiency level from multiple 

manufacturers to determine conversion 

costs such as R&D expenditures and 

certification costs. Manufacturer data 

were aggregated to better reflect the 

industry as a whole and to protect 

confidential information. For the final 

rule, adjustments were made to product 

conversion costs based on feedback in 

the NOPR written comments submitted 

following the NOPR. Key drivers of 

product conversion costs included the 

re-design effort associated with 

modifying cabinets to incorporate 

improved cabinet insulation, along with 

the product and food safety certification 

costs associated with redesigning key 

equipment components. 

In general, DOE assumes that all 

conversion-related investments occur 

between the year of publication of the 

final rule and the year by which 

manufacturers must comply with an 

amended standard. The investment 

figures used in the GRIM can be found 

in section V.B.2.a of this document. For 

additional information on the estimated 

product conversion and capital 

conversion costs, see chapter 12 of the 

final rule TSD. 

b. Government Regulatory Impact Model 

Scenarios 

Markup Scenarios 

As discussed above, MSPs include 

direct manufacturing production costs 

(i.e., labor, material, and overhead 

estimated in DOE’s MPCs) and all nonproduction costs (i.e., SG&A, R&D, and 

interest), along with profit. To calculate 

the MSPs in the GRIM, DOE applied 

markups to the MPCs estimated in the 

engineering analysis and then added in 

the cost of shipping. Modifying these 

markups in the standards case yields 

different sets of impacts on 

manufacturers. For the MIA, DOE 

modeled two standards-case markup 

scenarios to represent the uncertainty 

regarding the potential impacts on 

prices and profitability for 

manufacturers following the 

implementation of amended energy 

conservation standards: (1) A 

preservation of gross margin percentage 

markup scenario; and (2) a preservation 

of operating profit markup scenario. 

These scenarios lead to different 

markups values that, when applied to 

the inputted MPCs, result in varying 

revenue and cash flow impacts. 

Under the preservation of gross 

margin percentage scenario, DOE 

applied a single uniform ‘‘gross margin 

percentage’’ markup across all efficiency 

levels. As production costs increase 

with efficiency, this scenario implies 

that the absolute dollar markup will 

increase as well. Based on publicly 

available financial information for 

manufacturers of commercial 

refrigeration equipment and comments 

from manufacturer interviews, DOE 

assumed the non-production cost 

markup—which includes SG&A 

expenses, R&D expenses, interest, and 

profit—to be 1.42. Because this markup 

scenario assumes that manufacturers 

would be able to maintain their gross 

margin percentage markups as 

production costs increase in response to 

an amended energy conservation 

standard, the scenario represents a high 

bound to industry profitability under an 

amended energy conservation standard. 

In the preservation of operating profit 

scenario, manufacturer markups are set 

so that operating profit 1 year after the 

compliance date of the amended energy 

conservation standard is the same as in 

the base case. Under this scenario, as 

the cost of production and the cost of 

sales go up, manufacturers are generally 

required to reduce their markups to a 

level that maintains base-case operating 

profit. The implicit assumption behind 

this markup scenario is that the industry 

can only maintain its operating profit in 

absolute dollars after compliance with 

the amended standard is required. 

Therefore, operating margin in 

percentage terms is squeezed (reduced) 

between the base case and standards 

case. DOE adjusted the manufacturer 

markups in the GRIM at each TSL to 

yield approximately the same earnings 

before interest and taxes in the 

standards case in the year after the 

compliance date of the amended 

standards as in the base case. This 

markup scenario represents a low bound 

to industry profitability under an 

amended energy conservation standard. 

3. Discussion of Comments 

During the NOPR public meeting, 

interested parties commented on the 

assumptions and results of the analyses 

as described in the TSD. Oral and 

written comments addressed several 

topics, including volume purchasing of 

components, refrigerants, redesign 

issues, LED material costs, the GRIM, 

foaming fixtures, cumulative regulatory 

burden, certification costs, and issues 

specific to small manufacturers. 

a. Volume Purchasing of Components 

Traulsen commented that the prices 

of high-efficiency condenser fan motors 

were higher than DOE stated, and that 

this would place a cost burden on small 

manufacturers who could not receive a 

purchase volume discount. (Traulsen, 

No. 65 at p. 4) DOE recognizes that 

small manufacturers face pricing 

disadvantages for key components in 

both the base case and the standards 

case. This issue is incorporated into the 

discussion of Regulatory Flexibility in 

section VI.B.2 of this final rule. 


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b. Refrigerants 

True commented that there was the 

potential for a substantial cost increase 

to manufacturers in the very near future 

due to the phasing out of HFCs. True 

further commented that new refrigerants 

may have an incremental cost of 5–10 

times over what is currently being paid 

for refrigerants. (True, Public Meeting 

Transcript, No. 62 at p. 279) The use of 

alternative refrigerants by manufacturers 

of commercial refrigeration equipment 

would not arise as a direct result of this 

rule, and thus was not considered in 

this analysis. Furthermore, there is no 

requirement mandating the use of 

alternative refrigerants at this time. DOE 

does not include the impacts of pending 

legislation or unfinalized regulations in 

its analyses, as any impact would be 

speculative. 

c. Redesign Issues 

Several manufacturers pointed out 

that high capital costs were required by 

the proposed standards. Traulsen 

asserted that up to 95% of all equipment 

would need to be redesigned as a result 

of the proposed standard. (Traulsen, No. 

62 at p. 315) True added that the cost 

of redesigning and retooling entire 

product lines, and including the costs of 

new refrigerants, would be cost 

prohibitive. (True, No. 62 at p. 341) 

With regard to the specific cost of 

replacing foaming fixtures, True 

commented that new fixtures could cost 

several hundred thousand dollars, and 

modifying fixtures in order to 

manufacture thicker foam panels could 

cost $40,000–$50,000 per fixture, while 

Southern Store Fixtures noted that it 

would have to change over 3,000 molds 

and 1,000 foaming fixtures for its entire 

product line, and that it would cost 

much more than the assumed 

$2,500,000. (True, No. 62 at p. 340) 

(SSF, No. 67 at p. 3) 

With regard to capital costs, True 

commented that switching from doublepane to triple pane glass would require 

new tooling and molds for 

manufacturing, costing up to $300,000 

per door model produced, and that if 

the interior volume of a unit were to 

change due to thicker foam, all shelving 

systems and weld fixtures would need 

to be redesigned. (True, No. 76 at p. 3) 

Furthermore, Traulsen commented that 

changing fixture depth would cause a 

change in production time per unit, and 

that this cost had not been reflected in 

the DOE analysis. (Traulsen, No. 65 at 

p. 9) Similarly, Hussmann commented 

that there was a substantial engineering 

cost associated with re-engineering case 

components in order to incorporate 

increased foam thickness. Specifically, 

Hussmann noted that in order to 

maintain outside dimensions of a case 

and increase insulation thickness, 

manufacturers would be required to 

redesign and retool every component 

based on the case’s internal dimensions. 

(Hussmann, No. 77 at p. 2) Hoshizaki, 

also expressed the same concern, adding 

that that DOE underestimated the cost 

associated with increasing foam 

thickness by 1⁄2′′, since this increase 

would require engineering, testing, 

tooling, production line changeover, 

down-time, packaging changes, and 

certification. (Hoshizaki, No. 84 at p. 2) 

DOE estimated the conversion costs 

associated with increases in foam 

thickness based on direct input from the 

industry in interviews, as well as 

through analysis of production 

equipment that is part of the 

engineering cost model. DOE’s analysis 

included capital conversion costs, 

including as tooling costs and 

production line upgrades, and product 

conversion costs, including redesign 

efforts, testing costs, industry 

certifications, and marketing changes. 

Differences in packing and shipping 

costs were also accounted for in the 

shipping cost component of the 

engineering analysis. 

In its NOPR analysis, DOE recognized 

the need for new foaming fixtures to 

accommodate thicker panels. However, 

for the final rule analysis, DOE revised 

its estimate of fixture investment for the 

entire CRE industry upward to $210 

million. 

At the NOPR stage, the MIA analysis 

did not associate a conversion cost with 

changes in display door designs based 

on DOE’s understanding that the vast 

majority of CRE manufacturers consider 

display doors to be purchased parts. 

Furthermore, in the final rule 

engineering analysis, DOE does not 

consider triple-pane display doors as a 

design option in its analysis. However, 

for the final rule, DOE updated its 

manufacturer impact analysis to account 

for the conversion costs associated with 

changes in door design and 

specification, such as moving from 

single-pane to double-pane for 

horizontal cases with transparent doors. 

d. LED Material Costs 

Structural Concepts commented that 

the implementation of LEDs would cost 

over $500,000 annually in material costs 

alone. (Structural Concepts, No. 85 at p. 

3) DOE agrees with Structural Concepts 

that some design options, such as LED 

lighting, require larger upfront 

investments in component inventory by 

manufacturers. DOE accounts for 

investment in more expensive 

components and greater amounts of raw 

materials as increases in working 

capital. Increases in working capital 

decrease free cash flow and are reflected 

in industry net present value (INPV), 

which DOE considers as a key input 

when selecting a standard level. 

e. GRIM 

AHRI asserted that the GRIM model 

should account for periodic revisions to 

energy standards and potential changes 

in refrigerant policy when estimating 

the INPV. (AHRI, No. 75 at p. 11) 

Additionally, AHRI commented that, 

since the GRIM predicts INPV across an 

extended period, the model should have 

accounted for impacts on manufacturers 

due to periodic revisions of energy 

conservation standards and potential 

changes to refrigerant policy, and that 

the INPV range at TSL4 was grossly 

underestimated since there will likely 

be up to five revisions to CRE standards 

by 2046. (AHRI, No. 75 at p. 13) 

However, DOE does not take unfinalized 

regulation into account in its analysis. 

Any forecast of amendments to the 

standard level in the future and the 

potential costs of those changes would 

be purely speculative and, therefore, 

outside the scope of analysis. 

f. Cumulative Regulatory Burden 

Traulsen commented that the cost 

burden to manufacturers of complying 

with both the 2009 and 2017 rules, 

which overlap, is unmanageable. 

(Traulsen, No. 65 at p. 22) Lennox also 

stated that the proposed standards 

would place significant cumulative 

regulatory burden on manufacturers. 

(Traulsen, No. 65 at p. 9) 

DOE defines cumulative regulatory 

burden (CRB) as regulations that go into 

effect within 3 years of the effective date 

of the standard under consideration. As 

a result, the 2009 amended standard is 

not one of the regulations listed in the 

CRB analysis in section V.B.2.e of this 

document. However, the market changes 

and equipment price impacts that 

resulted from the 2009 standard are 

incorporated into DOE’s analyses. 

g. Certification Costs 

AHRI commented that the 

implementation of higher efficiency 

compressors should include costs 

associated with safety certification (UL, 

etc.), compliance with NSF Standards, 

and recertification due to the induced 

change in the equipment performance. 

(AHRI, No. 75 at p. 13) In its NOPR and 

final rule analyses, DOE accounted for 

the UL and NSF certification costs 

associated with compressor changes. 

While UL and NSF certification costs 

can vary by manufacturers, DOE used an 

industry average combined cost of 


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62Forster, P., V. Ramaswamy, P. Artaxo, T. 

Berntsen, R. Betts, D.W. Fahey, J. Haywood, J. Lean, 

D.C. Lowe, G. Myhre, J. Nganga, R. Prinn, G. Raga, 

M. Schulz and R. Van Dorland. 2007: Changes in 

Atmospheric Constituents and in Radiative Forcing. 

In Climate Change 2007: The Physical Science 

Basis. Contribution of Working Group I to the 

Fourth Assessment Report of the Intergovernmental 

Panel on Climate Change. S. Solomon, D. Qin, M. 

Manning, Z. Chen, M. Marquis, K.B. Averyt, 

M.Tignor and H.L. Miller, Editors. 2007. Cambridge 

University Press, Cambridge, United Kingdom and 

New York, NY, USA. p. 212. 

63See North Carolina v. EPA, 550 F.3d 1176 (D.C. 

Cir. 2008); North Carolina v. EPA, 531 F.3d 896 

(D.C. Cir. 2008). 

64See EME Homer City Generation, LP v. EPA, 

696 F.3d 7, 38 (D.C. Cir. 2012), cert. granted, 81 

U.S.L.W. 3567, 81 U.S.L.W. 3696, 81 U.S.L.W. 3702 

(U.S. June 24, 2013) (No. 12–1182). 

$8,000 per model for those certifications 

in its final rule analysis. 

h. Small Manufacturers 

In its written comment, Traulsen 

expressed the opinion that the proposed 

rule would have a significant economic 

impact on a substantial number of small 

businesses and was therefore in 

violation of the Regulatory Flexibility 

Act. In particular, Traulsen drew 

attention to page 55983, column 2 of the 

Federal Register NOPR document, 

which stated that DOE could not certify 

that the proposed standards would not 

have a significant impact on a 

significant number of small businesses. 

(Traulsen, No. 65 at p.16) The George 

Washington University (GWU) also 

asserted in its comment that the 

proposed rule affected small 

businesses—both manufacturers and 

consumers—since it did not maintain 

flexibility and freedom of choice. (GWU, 

No. 66 at p. 11) To better understand the 

potential impact of the final rule on 

small businesses, DOE provides an 

assessment of the impacts on small 

manufacturers in section VI.B. 

K. Emissions Analysis 

In the emissions analysis, DOE 

estimated the reduction in power sector 

emissions of CO2, NOX, sulfur dioxide 

(SO2) and Hg from amended energy 

conservation standards for commercial 

refrigeration equipment. In addition, 

DOE estimates emissions impacts in 

production activities (extracting, 

processing, and transporting fuels) that 

provide the energy inputs to power 

plants. These are referred to as 

‘‘upstream’’ emissions. Together, these 

emissions account for the full-fuel-cycle 

(FFC). In accordance with DOE’s FFC 

Statement of Policy (76 FR 51282 

(August 18, 2011)) 77 FR 49701 (August 

17, 2012), the FFC analysis includes 

impacts on emissions of methane (CH4) 

and nitrous oxide (N2O), both of which 

are recognized as greenhouse gases. 

DOE primarily conducted the 

emissions analysis using emissions 

factors for CO2 and most of the other 

gases derived from data in AEO 2013, 

supplemented by data from other 

sources. DOE developed separate 

emissions factors for power sector 

emissions and upstream emissions. The 

method that DOE used to derive 

emissions factors is described in chapter 

13 of the final rule TSD. 

For CH4 and N2O, DOE calculated 

emissions reduction in tons and also in 

terms of units of carbon dioxide 

equivalent (CO2eq). Gases are converted 

to CO2eq by multiplying the physical 

units by the gas’ global warming 

potential (GWP) over a 100 year time 

horizon. Based on the Fourth 

Assessment Report of the 

Intergovernmental Panel on Climate 

Change,62 DOE used GWP values of 25 

for CH4 and 298 for N2O. 

EIA prepares the Annual Energy 

Outlook using the National Energy 

Modeling System (NEMS). Each annual 

version of NEMS incorporates the 

projected impacts of existing air quality 

regulations on emissions. AEO 2013 

generally represents current legislation 

and environmental regulations, 

including recent government actions, for 

which implementing regulations were 

available as of December 31, 2012. 

SO2 emissions from affected electric 

generating units (EGUs) are subject to 

nationwide and regional emissions capand-trade programs. Title IV of the 

Clean Air Act sets an annual emissions 

cap on SO2 for affected EGUs in the 48 

contiguous States (42 U.S.C. 7651 et 

seq.) and the District of Columbia (D.C.). 

SO2 emissions from 28 eastern States 

and D.C. were also limited under the 

Clean Air Interstate Rule (CAIR; 70 FR 

25162 (May 12, 2005)), which created an 

allowance-based trading program. CAIR 

was remanded to the U.S. 

Environmental Protection Agency (EPA) 

by the U.S. Court of Appeals for the 

District of Columbia but it remained in 

effect.63 See North Carolina v. EPA, 550 

F.3d 1176 (D.C. Cir. 2008); North 

Carolina v. EPA, 531 F.3d 896 (D.C. Cir. 

2008). In 2011, EPA issued a 

replacement for CAIR, the Cross-State 

Air Pollution Rule (CSAPR). 76 FR 

48208 (Aug. 8, 2011). On August 21, 

2012, the D.C. Circuit issued a decision 

to vacate CSAPR.64 The court ordered 

EPA to continue administering CAIR. 

The AEO 2013 emissions factors used 

for today’s final rule assume that CAIR 

remains a binding regulation through 

2040. 

The attainment of emissions caps is 

typically flexible among EGUs and is 

enforced through the use of tradable 

emissions allowances. Under existing 

EPA regulations, any excess SO2

emissions allowances resulting from the 

lower electricity demand caused by the 

adoption of a new or amended 

efficiency standard could be used to 

allow offsetting increases in SO2

emissions by any regulated EGU. In past 

rulemakings, DOE recognized that there 

was uncertainty about the effects of 

efficiency standards on SO2 emissions 

covered by the existing cap-and-trade 

system, but it concluded that negligible 

reductions in power sector SO2

emissions would occur as a result of 

standards. 

Beginning around 2015, however, SO2

emissions will fall as a result of the 

Mercury and Air Toxics Standards 

(MATS) for power plants. 77 FR 9304 

(February 16, 2012). In the final MATS 

rule, EPA established a standard for 

hydrogen chloride as a surrogate for 

acid gas hazardous air pollutants (HAP), 

and also established a standard for SO2

(a non-HAP acid gas) as an alternative 

equivalent surrogate standard for acid 

gas HAP. The same controls are used to 

reduce HAP and non-HAP acid gas; 

thus, SO2 emissions will be reduced as 

a result of the control technologies 

installed on coal-fired power plants to 

comply with the MATS requirements 

for acid gas. AEO2013 assumes that, in 

order to continue operating, coal plants 

must have either flue gas 

desulfurization or dry sorbent injection 

systems installed by 2015. Both 

technologies, which are used to reduce 

acid gas emissions, also reduce SO2

emissions. Under the MATS, NEMS 

shows a reduction in SO2 emissions 

when electricity demand decreases (e.g., 

as a result of energy efficiency 

standards). Emissions will be far below 

the cap that would be established by 

CAIR, so it is unlikely that excess SO2

emissions allowances resulting from the 

lower electricity demand would be 

needed or used to allow offsetting 

increases in SO2 emissions by any 

regulated EGU. Therefore, DOE believes 

that energy efficiency standards will 

reduce SO2 emissions in 2015 and 

beyond. 

CAIR established a cap on NOX

emissions in 28 eastern States and the 

District of Columbia. Energy 

conservation standards are expected to 

have little effect on NOX emissions in 

those States covered by CAIR because 

excess NOX emissions allowances 

resulting from the lower electricity 

demand could be used to allow 

offsetting increases in NOX emissions. 

However, standards would be expected 

to reduce NOX emissions in the States 

not affected by the caps, so DOE 

estimated NOX emissions reductions 


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65National Research Council. Hidden Costs of 

Energy: Unpriced Consequences of Energy 

Production and Use. 2009. National Academies 

Press: Washington, DC. 

from the standards considered in 

today’s final rule for these States. 

The MATS limit mercury emissions 

from power plants, but they do not 

include emissions caps and, as such, 

DOE’s energy conservation standards 

would likely reduce Hg emissions. DOE 

estimated mercury emissions factors 

based on AEO2013, which incorporates 

the MATS. 

L. Monetizing Carbon Dioxide and Other 

Emissions Impacts 

As part of the development of the 

standards in this final rule, DOE 

considered the estimated monetary 

benefits from the reduced emissions of 

CO2 and NOX that are expected to result 

from each of the TSLs considered. In 

order to make this calculation analogous 

to the calculation of the NPV of 

customer benefit, DOE considered the 

reduced emissions expected to result 

over the lifetime of equipment shipped 

in the forecast period for each TSL. This 

section summarizes the basis for the 

monetary values used for each of these 

emissions and presents the values 

considered in this final rule. 

For today’s final rule, DOE is relying 

on a set of values for the SCC that was 

developed by a Federal interagency 

process. The basis for these values is 

summarized below, and a more detailed 

description of the methodologies used is 

provided as an appendix to chapter 14 

of the final rule TSD. 

1. Social Cost of Carbon 

The SCC is an estimate of the 

monetized damages associated with an 

incremental increase in carbon 

emissions in a given year. It is intended 

to include (but is not limited to) changes 

in net agricultural productivity, human 

health, property damages from 

increased flood risk, and the value of 

ecosystem services. Estimates of the 

SCC are provided in dollars per metric 

ton of carbon dioxide. A domestic SCC 

value is meant to reflect the value of 

damages in the United States resulting 

from a unit change in carbon dioxide 

emissions, while a global SCC value is 

meant to reflect the value of damages 

worldwide. 

Under section 1(b) of Executive Order 

12866, agencies must, to the extent 

permitted by law, ‘‘assess both the costs 

and the benefits of the intended 

regulation and, recognizing that some 

costs and benefits are difficult to 

quantify, propose or adopt a regulation 

only upon a reasoned determination 

that the benefits of the intended 

regulation justify its costs.’’ The purpose 

of the SCC estimates presented here is 

to allow agencies to incorporate the 

monetized social benefits of reducing 

CO2 emissions into cost-benefit analyses 

of regulatory actions. The estimates are 

presented with an acknowledgement of 

the many uncertainties involved and 

with a clear understanding that they 

should be updated over time to reflect 

increasing knowledge of the science and 

economics of climate impacts. 

As part of the interagency process that 

developed these SCC estimates, 

technical experts from numerous 

agencies met on a regular basis to 

consider public comments, explore the 

technical literature in relevant fields, 

and discuss key model inputs and 

assumptions. The main objective of this 

process was to develop a range of SCC 

values using a defensible set of input 

assumptions grounded in the existing 

scientific and economic literatures. In 

this way, key uncertainties and model 

differences transparently and 

consistently inform the range of SCC 

estimates used in the rulemaking 

process. 

a. Monetizing Carbon Dioxide Emissions 

When attempting to assess the 

incremental economic impacts of carbon 

dioxide emissions, the analyst faces a 

number of challenges. A report from the 

National Research Council 65 points out 

that any assessment will suffer from 

uncertainty, speculation, and lack of 

information about (1) future emissions 

of GHGs, (2) the effects of past and 

future emissions on the climate system, 

(3) the impact of changes in climate on 

the physical and biological 

environment, and (4) the translation of 

these environmental impacts into 

economic damages. As a result, any 

effort to quantify and monetize the 

harms associated with climate change 

will raise questions of science, 

economics, and ethics and should be 

viewed as provisional. 

Despite the limits of both 

quantification and monetization, SCC 

estimates can be useful in estimating the 

social benefits of reducing CO2

emissions. The agency can estimate the 

benefits from reduced (or costs from 

increased) emissions in any future year 

by multiplying the change in emissions 

in that year by the SCC values 

appropriate for that year. The net 

present value of the benefits can then be 

calculated by multiplying each of these 

future benefits by an appropriate 

discount factor and summing across all 

affected years. 

It is important to emphasize that the 

interagency process is committed to 

updating these estimates as the science 

and economic understanding of climate 

change and its impacts on society 

improves over time. In the meantime, 

the interagency group will continue to 

explore the issues raised by this analysis 

and consider public comments as part of 

the ongoing interagency process. 

b. Development of Social Cost of Carbon 

Values 

In 2009, an interagency process was 

initiated to offer a preliminary 

assessment of how best to quantify the 

benefits from reducing carbon dioxide 

emissions. To ensure consistency in 

how benefits are evaluated across 

Federal agencies, the Administration 

sought to develop a transparent and 

defensible method, specifically 

designed for the rulemaking process, to 

quantify avoided climate change 

damages from reduced CO2 emissions. 

The interagency group did not 

undertake any original analysis. Instead, 

it combined SCC estimates from the 

existing literature to use as interim 

values until a more comprehensive 

analysis could be conducted. The 

outcome of the preliminary assessment 

by the interagency group was a set of 

five interim values: global SCC 

estimates for 2007 (in 2006$) of $55, 

$33, $19, $10, and $5 per metric ton of 

CO2. These interim values represented 

the first sustained interagency effort 

within the U.S. government to develop 

an SCC for use in regulatory analysis. 

The results of this preliminary effort 

were presented in several proposed and 

final rules. 

c. Current Approach and Key 

Assumptions 

After the release of the interim values, 

the interagency group reconvened on a 

regular basis to generate improved SCC 

estimates. Specially, the group 

considered public comments and 

further explored the technical literature 

in relevant fields. The interagency group 

relied on three integrated assessment 

models commonly used to estimate the 

SCC: the FUND, DICE, and PAGE 

models. These models are frequently 

cited in the peer-reviewed literature and 

were used in the last assessment of the 

Intergovernmental Panel on Climate 

Change (IPCC). Each model was given 

equal weight in the SCC values that 

were developed. 

Each model takes a slightly different 

approach to model how changes in 

emissions result in changes in economic 

damages. A key objective of the 

interagency process was to enable a 

consistent exploration of the three 

models, while respecting the different 

approaches to quantifying damages 


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66 It is recognized that this calculation for 

domestic values is approximate, provisional, and 

highly speculative. There is no a priori reason why 

domestic benefits should be a constant fraction of 

net global damages over time. 

67Social Cost of Carbon for Regulatory Impact 

Analysis Under Executive Order 12866. Interagency 

Working Group on Social Cost of Carbon, United 

States Government, February 2010. 

www.whitehouse.gov/sites/default/files/omb/

inforeg/for-agencies/Social-Cost-of-Carbon-forRIA.pdf. 

68Technical Update of the Social Cost of Carbon 

for Regulatory Impact Analysis Under Executive 

Order 12866. Interagency Working Group on Social 

Cost of Carbon, United States Government. May 

2013; revised November 2013. http://

www.whitehouse.gov/sites/default/files/omb/assets/

inforeg/technical-update-social-cost-of-carbon-forregulator-impact-analysis.pdf. 

taken by the key modelers in the field. 

An extensive review of the literature 

was conducted to select three sets of 

input parameters for these models: 

climate sensitivity, socio-economic and 

emissions trajectories, and discount 

rates. A probability distribution for 

climate sensitivity was specified as an 

input into all three models. In addition, 

the interagency group used a range of 

scenarios for the socio-economic 

parameters and a range of values for the 

discount rate. All other model features 

were left unchanged, relying on the 

model developers’ best estimates and 

judgments. 

The interagency group selected four 

sets of SCC values for use in regulatory 

analyses. Three sets of values are based 

on the average SCC from the three IAMs, 

at discount rates of 2.5, 3, and 5 percent. 

The fourth set, which represents the 

95th percentile SCC estimate across all 

three models at a 3-percent discount 

rate, was included to represent higher 

than expected impacts from temperature 

change further out in the tails of the 

SCC distribution. The values grow in 

real terms over time. Additionally, the 

interagency group determined that a 

range of values from 7 percent to 23 

percent should be used to adjust the 

global SCC to calculate domestic 

effects,66 although preference is given to 

consideration of the global benefits of 

reducing CO2 emissions. Table IV.4 

presents the values in the 2010 

interagency group report,67 which is 

reproduced in appendix 14A of the DOE 

final rule TSD. 

TABLE IV.4—ANNUAL SCC VALUES FROM 2010 INTERAGENCY REPORT, 2010–2050 

[2007 dollars per metric ton] 

Year 

Discount Rate 

5% 3% 2.5% 3% 

Average Average Average 95th percentile 

2010 ................................................................................................................. 4.7 21.4 35.1 64.9 

2015 ................................................................................................................. 5.7 23.8 38.4 72.8 

2020 ................................................................................................................. 6.8 26.3 41.7 80.7 

2025 ................................................................................................................. 8.2 29.6 45.9 90.4 

2030 ................................................................................................................. 9.7 32.8 50.0 100.0 

2035 ................................................................................................................. 11.2 36.0 54.2 109.7 

2040 ................................................................................................................. 12.7 39.2 58.4 119.3 

2045 ................................................................................................................. 14.2 42.1 61.7 127.8 

2050 ................................................................................................................. 15.7 44.9 65.0 136.2 

The SCC values used for today’s 

document were generated using the 

most recent versions of the three 

integrated assessment models that have 

been published in the peer-reviewed 

literature.68 Table IV.5 shows the 

updated sets of SCC estimates in 5-year 

increments from 2010 to 2050. The full 

set of annual SCC estimates between 

2010 and 2050 is reported in appendix 

14B of the DOE final rule TSD. The 

central value that emerges is the average 

SCC across models at the 3 percent 

discount rate. However, for purposes of 

capturing the uncertainties involved in 

regulatory impact analysis, the 

interagency group emphasizes the 

importance of including all four sets of 

SCC values. 

TABLE IV.5—ANNUAL SCC VALUES FROM 2013 INTERAGENCY REPORT, 2010–2050 

[2007 dollars per metric ton] 

Year 

Discount rate 

5% 3% 2.5% 3% 

Average Average Average 95th percentile 

2010 ................................................................................................................. 11 32 51 89 

2015 ................................................................................................................. 11 37 57 109 

2020 ................................................................................................................. 12 43 64 128 

2025 ................................................................................................................. 14 47 69 143 

2030 ................................................................................................................. 16 52 75 159 

2035 ................................................................................................................. 19 56 80 175 

2040 ................................................................................................................. 21 61 86 191 

2045 ................................................................................................................. 24 66 92 206 

2050 ................................................................................................................. 26 71 97 220 

It is important to recognize that a 

number of key uncertainties remain, and 

that current SCC estimates should be 

treated as provisional and revisable 

since they will evolve with improved 

scientific and economic understanding. 


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69Available at: http://www.whitehouse.gov/sites/

default/files/omb/inforeg/social_cost_of_carbon_

for_ria_2013_update.pdf. 

70Available at: http://www.cio.noaa.gov/services_

programs/pdfs/OMB_Peer_Review_Bulletin_m05- 

03.pdf. 

71https://www.directives.doe.gov/references/

secretarial_policy_statement_on_scientific_

integrity/view. 

The interagency group also recognizes 

that the existing models are imperfect 

and incomplete. The 2009 National 

Research Council report mentioned 

above points out that there is tension 

between the goal of producing 

quantified estimates of the economic 

damages from an incremental ton of 

carbon and the limits of existing efforts 

to model these effects. There are a 

number of analytic challenges that are 

being addressed by the research 

community, including research 

programs housed in many of the Federal 

agencies participating in the interagency 

process to estimate the SCC. The 

interagency group intends to 

periodically review and reconsider 

those estimates to reflect increasing 

knowledge of the science and 

economics of climate impacts, as well as 

improvements in modeling. 

In summary, in considering the 

potential global benefits resulting from 

reduced CO2 emissions, DOE used the 

values from the 2013 interagency report 

adjusted to 2012$ using the GDP price 

deflator. For each of the four sets of SCC 

values, the values for emissions in 2015 

were $11.8, $39.7, $61.2, and $117 per 

metric ton avoided (values expressed in 

2012$). DOE derived values after 2050 

using the relevant growth rates for the 

2040–2050 period in the interagency 

update. 

DOE multiplied the CO2 emissions 

reduction estimated for each year by the 

SCC value for that year in each of the 

four cases. To calculate a present value 

of the stream of monetary values, DOE 

discounted the values in each of the 

four cases using the specific discount 

rate that had been used to obtain the 

SCC values in each case. 

In responding to the NOPR, many 

commenters questioned the scientific 

and economic basis of the SCC values. 

These commenters made extensive 

comments about: The alleged lack of 

economic theory underlying the models; 

the sufficiency of the models for policymaking; potential flaws in the models’ 

inputs and assumptions (including the 

discount rates and climate sensitivity 

chosen); whether there had been 

adequate peer review of the three 

models; whether there had been 

adequate peer review of the interagency 

TSD supporting the 2013 SCC values; 69

whether the SCC estimates comply with 

OMB’s ‘‘Final Information Quality 

Bulletin for Peer Review’’ 70 and DOE’s 

own guidelines for ensuring and 

maximizing the quality, objectivity, 

utility and integrity of information 

disseminated by DOE; and why DOE is 

considering global benefits of carbon 

dioxide emission reductions rather than 

solely domestic benefits. (See AHRI, No. 

75; Joint Comment from America’s 

Natural Gas Alliance, the American 

Chemistry Council, the American 

Petroleum Institute, the National 

Association of Home Builders, the 

National Association of Manufacturers, 

the Portland Cement Association, and 

the U.S. Chamber of Commerce (ANGA 

et al/Chamber of Commerce), No. 79; 

Cato Institute (Cato), No. 69; EEI, No. 89; 

GWU, No. 66; Mercatus, No. 72; 

NRECA, No. 88; Traulsen, No. 65. 

Several other parties expressed support 

for the derivation and application of the 

SCC values. (Joint Comment from the 

Environmental Defense Fund, Institute 

for Policy Integrity, Natural Resources 

Defense Council, and the Union of 

Concerned Scientists, No. 83; ASAP, 

No. 91; Kopp, No. 60) 

In response to the comments on the 

SCC values, DOE acknowledges the 

limitations in the SCC estimates, which 

are discussed in detail in the 2010 

interagency group report. Specifically, 

uncertainties in the assumptions 

regarding climate sensitivity, as well as 

other model inputs such as economic 

growth and emissions trajectories, are 

discussed and the reasons for the 

specific input assumptions chosen are 

explained. Regarding discount rates, 

there is not consensus in the scientific 

or economics literature regarding the 

appropriate discount rate to use for 

intergenerational time horizons. The 

SCC estimates thus use a reasonable 

range of discount rates, from 2.5% to 

5%, in order to show the effects that 

different discount rate assumptions 

have on the estimated values. More 

information about the choice of 

discount rates can be found in the 2010 

interagency group report starting on 

page 17. 

Regarding peer review of the models, 

the three integrated assessment models 

used to estimate the SCC are frequently 

cited in the peer-reviewed literature and 

were used in the last assessment of the 

IPCC. In addition, new versions of the 

models that were used in 2013 to 

estimate revised SCC values were 

published in the peer-reviewed 

literature (see appendix 14B of the DOE 

final rule TSD for discussion). 

DOE believes that the SCC estimates 

comply with OMB’s Final Information 

Quality Bulletin for Peer Review and 

DOE’s own guidelines for ensuring and 

maximizing the quality, objectivity, 

utility and integrity of information 

disseminated by DOE.71

As to why DOE is considering global 

benefits of carbon dioxide emission 

reductions rather than solely domestic 

benefits, a global measure of SCC 

because of the distinctive nature of the 

climate change problem, which is 

highly unusual in at least two respects. 

First, it involves a global externality: 

Emissions of most greenhouse gases 

contribute to damages around the world 

even when they are emitted in the 

United States. Second, climate change 

presents a problem that the United 

States alone cannot solve. The issue of 

global versus domestic measures of the 

SCC is further discussed in appendix 

14A of the DOE final rule TSD. 

AHRI stated that DOE calculates the 

present value of the costs of standards 

to consumers and manufacturers over a 

30-year period, but the SCC values 

reflect the present value of future 

climate related impacts well beyond 

2100. AHRI stated that DOE’s 

comparison of 30 years of cost to 

hundreds of years of presumed future 

benefits is inconsistent and improper. 

(AHRI, No. 84 at p. 12) 

For the analysis of national impacts of 

the proposed standards, DOE 

considered the lifetime impacts of 

equipment shipped in a 30-year period. 

With respect to energy and energy cost 

savings, impacts continue past 30 years 

until all of the equipment shipped in 

the 30-year period is retired. With 

respect to the valuation of CO2

emissions reductions, the SCC estimates 

developed by the interagency working 

group are meant to represent the full 

discounted value (using an appropriate 

range of discount rates) of emissions 

reductions occurring in a given year. 

DOE is thus comparing the costs of 

achieving the emissions reductions in 

each year of the analysis, with the 

carbon reduction value of the emissions 

reductions in those same years. Neither 

the costs nor the benefits of emissions 

reductions outside the analytic time 

frame are included in the analysis. 

In November 2013, OMB announced a 

new opportunity for public comment on 

the interagency technical support 

document underlying the revised SCC 

estimates. See 78 FR 70586. The 

comment period for the OMB 

announcement closed on February 26, 

2014. OMB is currently reviewing 

comments and considering whether 

further revisions to the 2013 SCC 

estimates are warranted. DOE stands 

ready to work with OMB and the other 


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72For additional information, refer to U.S. Office 

of Management and Budget, Office of Information 

and Regulatory Affairs, 2006 Report to Congress on 

the Costs and Benefits of Federal Regulations and 

Unfunded Mandates on State, Local, and Tribal 

Entities, Washington, DC. 

73The EIA allows the use of the name ‘‘NEMS’’ 

to describe only an AEO version of the model 

without any modification to code or data. Because 

the present analysis entails some minor code 

modifications and runs the model under various 

policy scenarios that deviate from AEO 

assumptions, the name ‘‘NEMS–BT’’ refers to the 

model as used here. For more information on 

NEMS, refer to The National Energy Modeling 

System: An Overview, DOE/EIA–0581 (98) 

(Feb.1998), available at: http://tonto.eia.doe.gov/

FTPROOT/forecasting/058198.pdf. 

74U.S. Department of Commerce, Bureau of 

Economic Analysis. Benchmark Input-Output 

Accounts. 1997. U.S. Government Printing Office: 

Washington, DC. 

members of the interagency working 

group on further review and revision of 

the SCC estimates as appropriate. 

2. Valuation of Other Emissions 

Reductions 

DOE investigated the potential 

monetary benefit of reduced NOX

emissions from the potential standards 

it considered. As noted above, DOE has 

taken into account how new or 

amended energy conservation standards 

would reduce NOX emissions in those 

22 States not affected by emissions caps. 

DOE estimated the monetized value of 

NOX emissions reductions resulting 

from each of the TSLs considered for 

today’s final rule based on estimates 

found in the relevant scientific 

literature. Estimates of monetary value 

for reducing NOX from stationary 

sources range from $468 to $4,809 per 

ton (2012$).72 DOE calculated monetary 

benefits using a medium value for NOX

emissions of $2,639 per short ton (in 

2012$), and real discount rates of 3 

percent and 7 percent. 

DOE is evaluating appropriate 

monetization of avoided SO2 and Hg 

emissions in energy conservation 

standards rulemakings. It has not 

included monetization in the current 

analysis. 

M. Utility Impact Analysis 

The utility impact analysis estimates 

several important effects on the utility 

industry of the adoption of new or 

amended standards. For this analysis, 

DOE used the National Energy Modeling 

System—Building Technologies 

(NEMS–BT) 73 model to generate 

forecasts of electricity consumption, 

electricity generation by plant type, and 

electric generating capacity by plant 

type, that would result from each 

considered TSL. DOE obtained the 

energy savings inputs associated with 

efficiency improvements to considered 

products from the NIA. DOE conducts 

the utility impact analysis as a scenario 

that departs from the latest AEO 

Reference Case. In the analysis for 

today’s rule, the estimated impacts of 

standards are the differences between 

values forecasted by NEMS–BT and the 

values in the AEO2013 Reference Case. 

For more details on the utility impact 

analysis, see chapter 15 of the final rule 

TSD. 

N. Employment Impact Analysis 

Employment impacts are one of the 

factors that DOE considers in selecting 

an efficiency standard. Employment 

impacts include direct and indirect 

impacts. Direct employment impacts are 

any changes that affect employment of 

commercial refrigeration equipment 

manufacturers, their suppliers, and 

related service firms. Indirect impacts 

are those changes in employment in the 

larger economy which occur because of 

the shift in expenditures and capital 

investment caused by the purchase and 

operation of more-efficient commercial 

refrigeration equipment. Direct 

employment impacts are analyzed as 

part of the MIA. Indirect impacts are 

assessed as part of the employment 

impact analysis. 

Indirect employment impacts from 

amended commercial refrigeration 

equipment standards consist of the net 

jobs created or eliminated in the 

national economy, other than in the 

manufacturing sector being regulated, as 

a consequence of (1) reduced spending 

by end users on electricity; (2) reduced 

spending on new energy supply by the 

utility industry; (3) increased spending 

on the purchase price of new 

commercial refrigeration equipment; 

and (4) the effects of those three factors 

throughout the Nation’s economy. DOE 

expects the net monetary savings from 

amended standards to stimulate other 

forms of economic activity. DOE also 

expects these shifts in spending and 

economic activity to affect the demand 

for labor. 

In developing this analysis for today’s 

standard, DOE estimated indirect 

national employment impacts using an 

input/output model of the U.S. 

economy, called ImSET (Impact of 

Sector Energy Technologies), developed 

by DOE’s Building Technologies 

Program. ImSET is an economic analysis 

model that characterizes the 

interconnections among 188 sectors of 

the economy as national input/output 

structural matrices, using data from the 

U.S. Department of Commerce’s 1997 

Benchmark U.S. input/output table.74

The ImSET model estimates changes in 

employment, industry output, and wage 

income in the overall U.S. economy 

resulting from changes in expenditures 

in various sectors of the economy. DOE 

estimated changes in expenditures using 

the NIA model. ImSET then estimated 

the net national indirect employment 

impacts that amended commercial 

refrigeration equipment efficiency 

standards could have on employment by 

sector. 

For more details on the employment 

impact analysis and its results, see 

chapter 16 of the TSD. 

V. Analytical Results 

A. Trial Standard Levels 

1. Trial Standard Level Formulation 

Process and Criteria 

Based on the results of the LCC 

analysis and NIA, DOE selected five 

TSLs above the baseline level for each 

equipment class for the final rule. TSL 

5 was selected at the max-tech level for 

all equipment classes. TSL 4 was chosen 

so as to group the efficiency levels with 

the highest energy savings combined 

with a positive customer NPV at a 7- 

percent discount rate. TSL 3 was chosen 

to represent the group of efficiency 

levels with the highest customer NPV at 

a 7-percent discount rate. TSL 2 and 

TSL 1 were chosen to provide 

intermediate efficiency levels that fill 

the gap between the baseline efficiency 

levels and TSL 3. 

For the HCT.SC.I, HZO.RC.M, and 

HZO.RC.L equipment classes, there is 

only one efficiency level above baseline. 

For the HZO.SC.L equipment class, 

there are no efficiency levels above 

baseline, because there was only one 

analytical design analyzed engineering 

analysis compliant with the 2009 final 

rule. While TSL 5 was associated with 

the max-tech level for HCT.SC.I, 

HZO.RC.M, and HZO.RC.L equipment 

classes, TSLs 1 through 4 did not have 

corresponding efficiency levels that 

satisfied the TSL formulation criteria. 

Therefore, the baseline efficiency level 

was assigned to TSL 1 through TSL 4 for 

each of these equipment classes. Table 

V.1 shows the mapping between TSLs 

and efficiency levels. 


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TABLE V.1—MAPPING BETWEEN TSLS AND EFFICIENCY LEVELS

Equipment class 

Intermediate level Intermediate level Max NPV * Max NES NPV * >0-† Max-tech 

TSL 1 TSL 2 TSL 3 TSL 4 TSL 5 

VOP.RC.M .................. Baseline .................... Baseline .................... EL 1 .......................... EL 3 .......................... EL 4. 

VOP.RC.L ................... Baseline .................... Baseline .................... EL 1 .......................... EL 2 .......................... EL 3. 

VOP.SC.M .................. Baseline .................... Baseline .................... Baseline .................... EL 1 .......................... EL 2. 

VCT.RC.M .................. Baseline .................... Baseline .................... EL 1 .......................... EL 3 .......................... EL 4. 

VCT.RC.L ................... EL 1 .......................... EL 1 .......................... EL 2 .......................... EL 3 .......................... EL 4. 

VCT.SC.M .................. EL 1 .......................... EL 2 .......................... EL 3 .......................... EL 5 .......................... EL 7. 

VCT.SC.L ................... EL 1 .......................... EL 3 .......................... EL 5 .......................... EL 7 .......................... EL 7. 

VCT.SC.I .................... EL 1 .......................... EL 1 .......................... EL 1 .......................... EL 3 .......................... EL 4. 

VCS.SC.M .................. EL 1 .......................... EL 2 .......................... EL 4 .......................... EL 6 .......................... EL 7. 

VCS.SC.L ................... EL 1 .......................... EL 3 .......................... EL 5 .......................... EL 6 .......................... EL 7. 

VCS.SC.I .................... EL 1 .......................... EL 2 .......................... EL 4 .......................... EL 4 .......................... EL 5. 

SVO.RC.M .................. EL 1 .......................... EL 1 .......................... EL 1 .......................... EL 3 .......................... EL 4. 

SVO.SC.M .................. Baseline .................... Baseline .................... Baseline .................... EL 1 .......................... EL 3. 

SOC.RC.M ................. Baseline .................... Baseline .................... Baseline .................... EL 1 .......................... EL 4. 

SOC.SC.M .................. Baseline .................... Baseline .................... Baseline .................... EL 2 .......................... EL 4. 

HZO.RC.M .................. Baseline .................... Baseline .................... Baseline .................... Baseline .................... EL 1. 

HZO.RC.L ................... Baseline .................... Baseline .................... Baseline .................... Baseline .................... EL 1. 

HZO.SC.M .................. Baseline .................... EL 1 .......................... EL 1 .......................... EL 2 .......................... EL 3. 

HZO.SC.L ................... Baseline .................... Baseline .................... Baseline .................... Baseline .................... Baseline. 

HCT.SC.M .................. EL 2 .......................... EL 3 .......................... EL 4 .......................... EL 6 .......................... EL 7. 

HCT.SC.L ................... EL 2 .......................... EL 3 .......................... EL 4 .......................... EL 6 .......................... EL 7. 

HCT.SC.I .................... Baseline .................... Baseline .................... Baseline .................... Baseline .................... EL 1. 

HCS.SC.M .................. EL 1 .......................... EL 2 .......................... EL 3 .......................... EL 4 .......................... EL 6. 

HCS.SC.L ................... EL 1 .......................... EL 2 .......................... EL 3 .......................... EL 5 .......................... EL 6. 

PD.SC.M .................... EL 1 .......................... EL 2 .......................... EL 3 .......................... EL 4 .......................... EL 7. 

* NPV is estimated at a 7 percent discount rate. 

2. Trial Standard Level Equations 

Because of the equipment size 

variation within each equipment class 

and the use of daily energy 

consumption as the efficiency metric, 

DOE developed a methodology to 

express efficiency standards in terms of 

a normalizing metric. DOE used two 

normalizing metrics that were each used 

for certain equipment classes: (1) 

Volume (V), and (2) total display area 

(TDA). The use of these two 

normalization metrics allows for the 

development of a standard in the form 

of a linear equation that can be used to 

represent the entire range of equipment 

sizes within a given equipment class. 

DOE retained the respective 

normalization metric (TDA or volume) 

previously used in the EPACT 2005, 

AEMTCA, or January 2009 final rule 

standard for each covered equipment 

class. (42 U.S.C. 6313(c)(2)–(3)); 74 FR 

at 1093 (January 9, 2009). Additionally, 

for its January 2009 final rule, DOE 

developed offset factors as a method to 

adjust the energy efficiency 

requirements for smaller equipment in 

each equipment class analyzed. These 

offset factors, which form the yintercept on a plot of each standard 

level equation (representing a limit case 

of zero volume or zero TDA), accounted 

for certain components of the 

refrigeration load (such as conduction 

end effects) that remain constant even 

when equipment sizes vary. These 

constant loads affect smaller cases 

disproportionately. The offset factors 

were intended to approximate these 

constant loads and provide a fixed end 

point in an equation that describes the 

relationship between energy 

consumption and the corresponding 

normalization metric. 74 FR at 1118–19 

(January 9, 2009). The standard level 

equations prescribed by EPACT 2005 

also contained similar fixed parts not 

multiplied by the volume metric and 

which correspond to these offset factors. 

(42 U.S.C. 6313(c)(2)) In this final rule, 

DOE retained the January 2009 final rule 

offset factors at all TSLs, and updated 

those included in the EPACT 2005 

standards to reflect size-based trends in 

energy consumption for each equipment 

class. See chapter 5 of the TSD for 

further details and discussion of offset 

factors. 

For the equipment classes covered 

under this rulemaking, the standards 

equation at each TSL is presented in the 

form of MDEC (in kilowatt-hours per 

day), normalized by a volume (V) or 

TDA metric, with an offset factor added 

to that value. These equations take the 

form: 

MDEC = A × TDA + B (for equipment 

using TDA as a normalizing metric) 

or 

MDEC = A × V + B (for equipment using 

volume as a normalizing metric) 

The standards equations may be used 

to prescribe the MDEC for equipment of 

different sizes within the same 

equipment class. Chapter 9 of the final 

rule TSD explains the methodology 

used for selecting TSLs and developing 

the coefficients shown in Table V.3. 

TABLE V.2—CDEC VALUES BY TSL FOR REPRESENTATIVE UNITS ANALYZED IN THE ENGINEERING ANALYSIS FOR EACH

PRIMARY EQUIPMENT CLASS

Equipment class 

CDEC Values by TSL 

kWh/day 

TSL 1 TSL 2 TSL 3 TSL 4 TSL 5 

VOP.RC.M ................................................................. 46 .84 46 .84 38 .02 36 .1 35 .65 

VOP.RC.L .................................................................. 105 .6 105 .6 104 .94 101 .70 100 .01 


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75The matched-pair analyses compared 

calculated energy consumption levels for pieces of 

equipment with similar designs but one major 

construction or operational difference; for example, 

vertical open remote condensing cases operating at 

medium and low temperatures. The relationships 

between these sets of units were used to determine 

the effect of the design or operational difference on 

TABLE V.2—CDEC VALUES BY TSL FOR REPRESENTATIVE UNITS ANALYZED IN THE ENGINEERING ANALYSIS FOR EACH

PRIMARY EQUIPMENT CLASS—Continued 

Equipment class 

CDEC Values by TSL 

kWh/day 

TSL 1 TSL 2 TSL 3 TSL 4 TSL 5 

VOP.SC.M .................................................................. 30 .01 30 .01 30 .01 29 .91 29 .71 

VCT.RC.M .................................................................. 13 .65 13 .65 11 .8 11 .49 10 .99 

VCT.RC.L ................................................................... 35 .34 35 .34 34 .78 34 .50 33 .04 

VCT.SC.M .................................................................. 6 .83 5 .99 5 .64 5 .45 5 .15 

VCT.SC.L ................................................................... 27 .46 18 .23 17 .16 16 .05 16 .05 

VCT.SC.I .................................................................... 19 .52 19 .52 19 .52 18 .95 18 .11 

VCS.SC.M .................................................................. 5 .29 4 .03 3 .69 3 .45 3 .03 

VCS.SC.L ................................................................... 13 .94 12 .94 12 .19 12 .08 11 .13 

VCS.SC.I .................................................................... 18 .70 18 .01 17 .43 17 .43 16 .04 

SVO.RC.M ................................................................. 29 .45 29 .45 29 .45 28 .01 27 .70 

SVO.SC.M .................................................................. 26 .32 26 .32 26 .32 25 .65 25 .4 

SOC.RC.M ................................................................. 22 .74 22 .74 22 .74 22 .31 21 .56 

SOC.SC.M ................................................................. 27 .72 27 .72 27 .72 26 .61 26 .12 

HZO.RC.M ................................................................. 14 .47 14 .47 14 .47 14 .47 14 .15 

HZO.RC.L .................................................................. 32 .36 32 .36 32 .36 32 .36 31 .08 

HZO.SC.M .................................................................. 14 .66 14 .16 14 .16 14 .02 13 .75 

HZO.SC.L ................................................................... 29 .92 29 .92 29 .92 29 .92 29 .92 

HCT.SC.M .................................................................. 1 .62 0 .99 0 .90 0 .79 0 .61 

HCT.SC.L ................................................................... 2 .15 2 .03 1 .92 1 .73 1 .32 

HCT.SC.I .................................................................... 3 .13 3 .13 3 .13 3 .13 2 .33 

HCS.SC.M .................................................................. 1 .42 1 .36 1 .28 1 .26 0 .98 

HCS.SC.L ................................................................... 1 .78 1 .67 1 .53 1 .29 0 .71 

PD.SC.M .................................................................... 4 .73 3 .90 3 .78 3 .75 3 .41 

TABLE V.3—EQUATIONS REPRESENTING THE STANDARDS AT EACH TSL FOR ALL PRIMARY EQUIPMENT CLASSES

Equipment 

class 

Trial standard levels for primary equipment classes analyzed 

Baseline TSL 1 TSL 2 TSL 3 TSL 4 TSL 5 

VOP.RC.M .. 0.82 × TDA + 4.07 0.8 × TDA + 4.07 .. 0.8 × TDA + 4.07 .. 0.64 × TDA + 4.07 0.6 × TDA + 4.07 .. 0.59 × TDA + 4.07. 

VOP.RC.L ... 2.27 × TDA + 6.85 2.21 × TDA + 6.85 2.21 × TDA + 6.85 2.2 × TDA + 6.85 .. 2.12 × TDA + 6.85 2.09 × TDA + 6.85. 

VOP.SC.M ... 1.74 × TDA + 4.71 1.69 × TDA + 4.71 1.69 × TDA + 4.71 1.69 × TDA + 4.71 1.69 × TDA + 4.71 1.67 × TDA + 4.71. 

VCT.RC.M ... 0.22 × TDA + 1.95 0.18 × TDA + 1.95 0.18 × TDA + 1.95 0.15 × TDA + 1.95 0.15 × TDA + 1.95 0.14 × TDA + 1.95. 

VCT.RC.L .... 0.56 × TDA + 2.61 0.5 × TDA + 2.61 .. 0.5 × TDA + 2.61 .. 0.49 × TDA + 2.61 0.49 × TDA + 2.61 0.47 × TDA + 2.61. 

VCT.SC.M ... 0.12 × V + 3.34 ..... 0.1 × V + 2.05 ....... 0.1 × V + 1.21 ....... 0.1 × V + 0.86 ....... 0.1 × V + 0.68 ....... 0.1 × V + 0.38. 

VCT.SC.L .... 0.75 × V + 4.1 ....... 0.48 × V + 4.1 ....... 0.29 × V + 4.1 ....... 0.29 × V + 2.95 ..... 0.29 × V + 1.84 ..... 0.29 × V + 1.84. 

VCT.SC.I ..... 0.67 × TDA + 3.29 0.62 × TDA + 3.29 0.62 × TDA + 3.29 0.62 × TDA + 3.29 0.6 × TDA + 3.29 .. 0.57 × TDA + 3.29. 

VCS.SC.M ... 0.1 × V + 2.04 ....... 0.07 × V + 2.04 ..... 0.05 × V + 1.69 ..... 0.05 × V + 1.36 ..... 0.05 × V + 1.11 ..... 0.05 × V + 0.7. 

VCS.SC.L .... 0.4 × V + 1.38 ....... 0.26 × V + 1.38 ..... 0.24 × V + 1.38 ..... 0.22 × V + 1.38 ..... 0.22 × V + 1.38 ..... 0.2 × V + 1.38. 

VCS.SC.I ..... 0.38 × V + 0.88 ..... 0.37 × V + 0.88 ..... 0.36 × V + 0.88 ..... 0.34 × V + 0.88 ..... 0.34 × V + 0.88 ..... 0.32 × V + 0.88. 

SVO.RC.M .. 0.83 × TDA + 3.18 0.66 × TDA + 3.18 0.66 × TDA + 3.18 0.66 × TDA + 3.18 0.62 × TDA + 3.18 0.61 × TDA + 3.18. 

SVO.SC.M ... 1.73 × TDA + 4.59 1.7 × TDA + 4.59 .. 1.7 × TDA + 4.59 .. 1.7 × TDA + 4.59 .. 1.65 × TDA + 4.59 1.63 × TDA + 4.59 

SOC.RC.M. 0.51 × TDA + 0.11 0.44 × TDA + 0.11 0.44 × TDA + 0.11 0.44 × TDA + 0.11 0.44 × TDA + 0.11 0.42 × TDA + 0.11. 

SOC.SC.M .. 0.6 × TDA + 1 ....... 0.52 × TDA + 1 ..... 0.52 × TDA + 1 ..... 0.52 × TDA + 1 ..... 0.5 × TDA + 1 ....... 0.49 × TDA + 1. 

HZO.RC.M .. 0.35 × TDA + 2.88 0.35 × TDA + 2.88 0.35 × TDA + 2.88 0.35 × TDA + 2.88 0.35 × TDA + 2.88 0.34 × TDA + 2.88. 

HZO.RC.L ... 0.57 × TDA + 6.88 0.55 × TDA + 6.88 0.55 × TDA + 6.88 0.55 × TDA + 6.88 0.55 × TDA + 6.88 0.53 × TDA + 6.88. 

HZO.SC.M ... 0.77 × TDA + 5.55 0.76 × TDA + 5.55 0.72 × TDA + 5.55 0.72 × TDA + 5.55 0.71 × TDA + 5.55 0.68 × TDA + 5.55. 

HZO.SC.L .... 1.92 × TDA + 7.08 1.9 × TDA + 7.08 .. 1.9 × TDA + 7.08 .. 1.9 × TDA + 7.08 .. 1.9 × TDA + 7.08 .. 1.9 × TDA + 7.08. 

HCT.SC.M ... 0.12 × V + 3.34 ..... 0.06 × V + 1.09 ..... 0.06 × V + 0.46 ..... 0.06 × V + 0.37 ..... 0.06 × V + 0.27 ..... 0.06 × V + 0.09. 

HCT.SC.L .... 0.75 × V + 4.1 ....... 0.08 × V + 1.47 ..... 0.08 × V + 1.35 ..... 0.08 × V + 1.23 ..... 0.08 × V + 1.05 ..... 0.08 × V + 0.63. 

HCT.SC.I ..... 0.56 × TDA + 0.43 0.56 × TDA + 0.43 0.56 × TDA + 0.43 0.56 × TDA + 0.43 0.56 × TDA + 0.43 0.4 × TDA + 0.43. 

HCS.SC.M ... 0.1 × V + 2.04 ....... 0.05 × V + 1.05 ..... 0.05 × V + 0.98 ..... 0.05 × V + 0.91 ..... 0.05 × V + 0.89 ..... 0.02 × V + 0.81. 

HCS.SC.L .... 0.4 × V + 1.38 ....... 0.06 × V + 1.38 ..... 0.06 × V + 1.26 ..... 0.06 × V + 1.12 ..... 0.06 × V + 0.89 ..... 0.06 × V + 0.31. 

PD.SC.M ..... 0.126 × V + 3.51 ... 0.11 × V + 1.76 ..... 0.11 × V + 0.93 ..... 0.11 × V + 0.81 ..... 0.11 × V + 0.78 ..... 0.11 × V + 0.44. 

In addition to the 25 primary 

equipment classes analyzed, DOE 

evaluated existing and potential 

amended standards for 24 secondary 

equipment classes of commercial 

refrigeration equipment covered in this 

rulemaking that were not directly 

analyzed in the engineering analysis. 

DOE’s approach to evaluating standards 

for these secondary equipment classes 

involves extension multipliers 

developed using the engineering results 

for the primary equipment classes 

analyzed and a set of matched-pair 

analyses performed during the January 

2009 final rule analysis.75 In addition, 


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applicable equipment. For more information, please 

see chapter 5 of the 2009 final rule TSD, which can 

be found at http://www.regulations.gov/

#!documentDetail;D=EERE-2006-STD-0126-0058. 

DOE believes that standards for certain 

primary equipment classes can be 

directly applied to similar secondary 

equipment classes. Chapter 5 of the final 

rule TSD discusses the development of 

the extension multipliers. 

Using the extension multiplier 

approach, DOE developed an additional 

set of TSLs and associated equations for 

the secondary equipment classes, as 

shown in Table V.4. The TSLs shown in 

Table V.4 do not necessarily satisfy the 

criteria spelled out in section V.A. DOE 

is presenting the standards equations 

developed for each TSL for all 47 

equipment classes to allow interested 

parties to better observe the 

ramifications of each TSL across the 

range of equipment sizes on the market. 

TABLE V.4—EQUATIONS REPRESENTING THE STANDARDS AT EACH TSL FOR ALL SECONDARY EQUIPMENT CLASSES

Equipment 

class 

Trial standard levels for secondary equipment classes analyzed 

Baseline TSL 1 TSL 2 TSL 3 TSL 4 TSL 5 

VOP.RC.I .... 2.89 × TDA + 8.7 .. 2.81 × TDA + 8.7 .. 2.81 × TDA + 8.7 .. 2.79 × TDA + 8.7 .. 2.7 × TDA + 8.7 .... 2.65 × TDA + 8.7. 

SVO.RC.L ... 2.27 × TDA + 6.85 2.21 × TDA + 6.85 2.21 × TDA + 6.85 2.2 × TDA + 6.85 .. 2.12 × TDA + 6.85 2.09 × TDA + 6.85. 

SVO.RC.I .... 2.89 × TDA + 8.7 .. 2.81 × TDA + 8.7 .. 2.81 × TDA + 8.7 .. 2.79 × TDA + 8.7 .. 2.7 × TDA + 8.7 .... 2.65 × TDA + 8.7. 

HZO.RC.I .... 0.72 × TDA + 8.74 0.7 × TDA + 8.74 .. 0.7 × TDA + 8.74 .. 0.7 × TDA + 8.74 .. 0.7 × TDA + 8.74 .. 0.67 × TDA + 8.74. 

VOP.SC.L .... 4.37 × TDA + 

11.82.

4.25 × TDA + 

11.82.

4.25 × TDA + 

11.82.

4.25 × TDA + 

11.82.

4.24 × TDA + 

11.82.

4.2 × TDA + 11.82. 

VOP.SC.I ..... 5.55 × TDA + 

15.02.

5.4 × TDA + 15.02 5.4 × TDA + 15.02 5.4 × TDA + 15.02 5.38 × TDA + 

15.02.

5.34 × TDA + 

15.02. 

SVO.SC.L .... 4.34 × TDA + 

11.51.

4.26 × TDA + 

11.51.

4.26 × TDA + 

11.51.

4.26 × TDA + 

11.51.

4.13 × TDA + 

11.51.

4.08 × TDA + 

11.51. 

SVO.SC.I ..... 5.52 × TDA + 

14.63.

5.41 × TDA + 

14.63.

5.41 × TDA + 

14.63.

5.41 × TDA + 

14.63.

5.24 × TDA + 

14.63.

5.18 × TDA + 

14.63. 

HZO.SC.I ..... 2.44 × TDA + 9 ..... 2.42 × TDA + 9 ..... 2.42 × TDA + 9 ..... 2.42 × TDA + 9 ..... 2.42 × TDA + 9 ..... 2.42 × TDA + 9. 

SOC.RC.L ... 1.08 × TDA + 0.22 0.93 × TDA + 0.22 0.93 × TDA + 0.22 0.93 × TDA + 0.22 0.91 × TDA + 0.22 0.88 × TDA + 0.22. 

SOC.RC.I .... 1.26 × TDA + 0.26 1.09 × TDA + 0.26 1.09 × TDA + 0.26 1.09 × TDA + 0.26 1.07 × TDA + 0.26 1.03 × TDA + 0.26. 

SOC.SC.I .... 1.76 × TDA + 0.36 1.53 × TDA + 0.36 1.53 × TDA + 0.36 1.53 × TDA + 0.36 1.5 × TDA + 0.36 .. 1.45 × TDA + 0.36. 

VCT.RC.I ..... 0.66 × TDA + 3.05 0.59 × TDA + 3.05 0.59 × TDA + 3.05 0.58 × TDA + 3.05 0.57 × TDA + 3.05 0.55 × TDA + 3.05. 

HCT.RC.M ... 0.16 × TDA + 0.13 0.16 × TDA + 0.13 0.16 × TDA + 0.13 0.16 × TDA + 0.13 0.16 × TDA + 0.13 0.12 × TDA + 0.13. 

HCT.RC.L .... 0.34 × TDA + 0.26 0.34 × TDA + 0.26 0.34 × TDA + 0.26 0.34 × TDA + 0.26 0.34 × TDA + 0.26 0.24 × TDA + 0.26. 

HCT.RC.I ..... 0.4 × TDA + 0.31 .. 0.4 × TDA + 0.31 .. 0.4 × TDA + 0.31 .. 0.4 × TDA + 0.31 .. 0.4 × TDA + 0.31 .. 0.28 × TDA + 0.31. 

VCS.RC.M ... 0.11 × V + 0.26 ..... 0.11 × V + 0.26 ..... 0.1 × V + 0.26 ....... 0.1 × V + 0.26 ....... 0.1 × V + 0.26 ....... 0.09 × V + 0.26. 

VCS.RC.L .... 0.23 × V + 0.54 ..... 0.23 × V + 0.54 ..... 0.22 × V + 0.54 ..... 0.21 × V + 0.54 ..... 0.21 × V + 0.54 ..... 0.19 × V + 0.54. 

VCS.RC.I ..... 0.27 × V + 0.63 ..... 0.27 × V + 0.63 ..... 0.25 × V + 0.63 ..... 0.25 × V + 0.63 ..... 0.25 × V + 0.63 ..... 0.23 × V + 0.63. 

HCS.SC.I ..... 0.38 × V + 0.88 ..... 0.37 × V + 0.88 ..... 0.36 × V + 0.88 ..... 0.34 × V + 0.88 ..... 0.34 × V + 0.88 ..... 0.32 × V + 0.88. 

HCS.RC.M .. 0.11 × V + 0.26 ..... 0.11 × V + 0.26 ..... 0.1 × V + 0.26 ....... 0.1 × V + 0.26 ....... 0.1 × V + 0.26 ....... 0.09 × V + 0.26. 

HCS.RC.L ... 0.23 × V + 0.54 ..... 0.23 × V + 0.54 ..... 0.22 × V + 0.54 ..... 0.21 × V + 0.54 ..... 0.21 × V + 0.54 ..... 0.19 × V + 0.54. 

HCS.RC.I .... 0.27 × V + 0.63 ..... 0.27 × V + 0.63 ..... 0.25 × V + 0.63 ..... 0.25 × V + 0.63 ..... 0.25 × V + 0.63 ..... 0.23 × V + 0.63. 

SOC.SC.L* .. 0.75 × V + 4.10 ..... 1.1 × TDA + 2.1 .... 1.1 × TDA + 2.1 .... 1.1 × TDA + 2.1 .... 1.05 × TDA + 2.1 .. 1.03 × TDA + 2.1. 

* Equipment class SOC.SC.L was inadvertently grouped under the category self-contained commercial freezers with transparent doors in the 

standards prescribed by EPCA, as amended by EPACT 2005. (42 U.S.C. 6313(c)(2)) The baseline expression is thus given by the expression 

0.75 × V + 4.10, which is the current standard for SOC.SC.L equipment. A similar anomaly (of inadvertent classification under a different equipment category) for SOC.SC.M equipment was corrected by the standard established by AEMTCA. (42 U.S.C. 6313(c)(4)) However, no such corrective action has been prescribed for standards for SOC.SC.L equipment. In establishing a new standard for SOC.SC.M equipment, AEMTCA 

also changed the normalization metric from volume (V) to total display area (TDA). Accordingly, DOE is promulgating amended standards for 

SOC.SC.M equipment with TDA as the normalization metric (see Table V.3), DOE derives the standard for secondary equipment classes based 

on the standard of a primary equipment that has similar characteristics as the secondary equipment class under consideration (see chapter 5 of 

the final rule TSD for details). For the equipment class SOC.SC.L, the standard was derived from the standard level selected for equipment class 

SOC.SC.M. Since the standard for SOC.SC.M is in terms of TDA, the standard for SOC.SC.L equipment has also been specified in terms of 

TDA. Therefore, while the baseline expression has been shown with V as the normalization metric, the expressions for TSLs 1 through 5 have 

been shown in terms of TDA. This change of normalization metric for equipment class SOC.SC.L is consistent with the legislative intent, evident 

in AEMTCA, for equipment class SOC.SC.M. 

B. Economic Justification and Energy 

Savings 

1. Economic Impacts on Commercial 

Customers 

a. Life-Cycle Cost and Payback Period 

Customers affected by new or 

amended standards usually incur higher 

purchase prices and lower operating 

costs. DOE evaluates these impacts on 

individual customers by calculating the 

LCC and the PBP associated with the 

TSLs. The results of the LCC analysis for 

each TSL were obtained by comparing 

the installed and operating costs of the 

equipment in the base-case scenario 

(scenario with no amended energy 

conservation standards) against the 

standards-case scenarios at each TSL. 

The energy consumption values for both 

the base-case and standards-case 

scenarios were calculated based on the 

DOE test procedure conditions specified 

in the 2012 test procedure final rule. 77 

FR 10292, 10318–21 (February 21, 2012) 

The DOE test procedure adopted an 

industry-accepted test method and has 

been widely accepted as a reasonably 

accurate representation of the 

conditions to which a vast majority of 

the equipment covered in this 

rulemaking is subjected during actual 

use. As described in section IV.F, the 

LCC analysis was carried out in the form 

of Monte Carlo simulations. 

Consequently, the results are distributed 

over a range of values, as opposed to a 

single deterministic value. DOE presents 

the mean or median values, as 

appropriate, calculated from the 

distributions of results. 


tkelley on DSK3SPTVN1PROD with RULES2
17784 Federal Register / Vol. 79, No. 60 / Friday, March 28, 2014 / Rules and Regulations 

Table V.5 through Table V.29 show 

key results of the LCC and PBP analysis 

for each equipment class. Each table 

presents the mean LCC, mean LCC 

savings, median PBP, and distribution 

of customer impacts in the form of 

percentages of customers who 

experience net cost, no impact, or net 

benefit. 

All of the equipment classes, except 

for VCT.SC.L, have negative LCC 

savings values at TSL 5. Negative 

average LCC savings imply that, on 

average, customers experience an 

increase in LCC as a consequence of 

buying equipment associated with that 

particular TSL. 

The mean LCC savings associated 

with TSL 4 vary by equipment class, 

and are negative for some equipment 

classes with significant market shares. 

The mean LCC savings at today’s 

standard, TSL 3, are all positive. (LCC 

savings are equal in cases in which both 

TSLs are associated with the same 

efficiency level.) 

Generally, customers who currently 

buy equipment in the base case scenario 

at or above the level of performance 

specified by the TSL under 

consideration would be unaffected if the 

amended standard were to be set at that 

TSL. Customers who buy equipment 

below the level of the TSL under 

consideration would be affected if the 

amended standard were to be set at that 

TSL. Among these affected customers, 

some may benefit (lower LCC) and some 

may incur net cost (higher LCC). DOE’s 

results indicate that only a small 

percentage of customers may benefit 

from an amended standard that is set at 

TSL 5. At TSL 4, the percentage of 

customers who experience net benefits 

or no impacts ranges from 0 to 92 

percent. At TSL 3, a larger percentage of 

customers experience net benefits or no 

impacts as compared to TSL 4. At TSLs 

1 and 2, almost all customers experience 

either net benefits or no impacts. 

For all of the equipment classes, 

except VCT.SC.L, the median PBPs for 

TSL 5 are greater than the average 

lifetime of the equipment, indicating 

that a majority of customers may not be 

able to recover the higher equipment 

installed costs through savings in 

operating costs during the life of the 

equipment. The median PBP values for 

TSL 4 range from 1.4 years to 63.1 years. 

The median PBP values at TSL 3 are all 

below the average lifetime of a majority 

of the commercial refrigeration 

equipment under consideration is 10 to 

15 years. Therefore, PBP results for TSL 

3 indicate that, in general, the majority 

of customers will be able to recover the 

increased purchase costs associated 

with equipment that is compliant with 

TSL 3 through operating cost savings 

within the lifetime of the equipment. 

TABLE V.5—SUMMARY LCC AND PBP RESULTS FOR VOP.RC.M EQUIPMENT CLASS* 

TSL 

Annual energy consumption 

kWh/yr 

Life-cycle cost, all customers 

2012$ 

Life-cycle cost savings 

Median 

payback 

period 

years Installed 

cost 

Discounted 

operating 

cost 

LCC 

Affected 

customers’ 

average 

savings 

2012$ 

% of Customers that experience** 

Net cost 

(percent) 

No impact 

(percent) 

Net benefit 

(percent) 

1 ............... 17,095 10,527 2,376 30,748 .................... 0 100 0 ....................

2 ............... 17,095 10,527 2,376 30,748 .................... 0 100 0 ....................

3 ............... 13,877 11,988 2,099 29,826 922 4 41 55 5.7 

4 ............... 13,177 12,786 2,071 30,374 ¥5 64 0 36 9.9 

5 ............... 13,013 15,901 2,202 34,572 ¥4,203 100 0 0 34.1 

* Percentages may not add up to 100 percent due to rounding. 

TABLE V.6—SUMMARY LCC AND PBP RESULTS FOR VOP.RC.L EQUIPMENT CLASS* 

TSL 

Annual energy consumption 

kWh/yr 

Life-cycle cost, all customers 

2012$ 

Life-cycle cost savings 

Median 

payback 

period 

years Installed 

cost 

Discounted 

operating 

cost 

LCC 

Affected 

customers’ 

average 

savings 

2012$ 

% of Customers that experience** 

Net cost 

(percent) 

No impact 

(percent) 

Net benefit 

(percent) 

1 ............... 38,544 11,699 4,445 49,574 .................... 0 100 0 ....................

2 ............... 38,544 11,699 4,445 49,574 .................... 0 100 0 ....................

3 ............... 38,301 11,799 4,427 49,521 53 7 40 53 5.7 

4 ............... 37,117 12,631 4,353 49,707 ¥148 59 20 21 7.2 

5 ............... 36,502 17,725 4,534 56,289 ¥6,701 100 0 0 9.9 

* Percentages may not add up to 100 percent due to rounding. 

TABLE V.7—SUMMARY LCC AND PBP RESULTS FOR VOP.SC.M EQUIPMENT CLASS* 

TSL 

Annual energy consumption 

kWh/yr 

Life-cycle cost, all customers 

2012$ 

Life-cycle cost savings 

Median 

payback 

period 

years Installed 

cost 

Discounted 

operating 

cost 

LCC 

Affected 

customers’ 

average 

savings 

2012$ 

% of Customers that experience** 

Net cost 

(percent) 

No impact 

(percent) 

Net benefit 

(percent) 

1 ............... 10,953 6,365 1,340 20,337 .................... 0 100 0 ....................

2 ............... 10,953 6,365 1,340 20,337 .................... 0 100 0 ....................

3 ............... 10,953 6,365 1,340 20,337 .................... 0 100 0 ....................

4 ............... 10,917 6,432 1,339 20,391 ¥54 60 40 0 5.7 


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Federal Register / Vol. 79, No. 60 / Friday, March 28, 2014 / Rules and Regulations 17785 

TABLE V.7—SUMMARY LCC AND PBP RESULTS FOR VOP.SC.M EQUIPMENT CLASS*—Continued 

TSL 

Annual energy consumption 

kWh/yr 

Life-cycle cost, all customers 

2012$ 

Life-cycle cost savings 

Median 

payback 

period 

years Installed 

cost 

Discounted 

operating 

cost 

LCC 

Affected 

customers’ 

average 

savings 

2012$ 

% of Customers that experience** 

Net cost 

(percent) 

No impact 

(percent) 

Net benefit 

(percent) 

5 ............... 10,846 7,483 1,368 21,742 ¥1,384 100 0 0 7.2 

* Percentages may not add up to 100 percent due to rounding. 

TABLE V.8—SUMMARY LCC AND PBP RESULTS FOR VCT.RC.M EQUIPMENT CLASS* 

TSL 

Annual energy consumption 

kWh/yr 

Life-cycle cost, all customers 

2012$ 

Life-cycle cost savings 

Median 

payback 

period 

years Installed 

cost 

Discounted 

operating 

cost 

LCC 

Affected 

customers’ 

average 

savings 

2012$ 

% of Customers that experience** 

Net cost 

(percent) 

No impact 

(percent) 

Net benefit 

(percent) 

1 ............... 4,981 12,951 1,263 23,996 .................... 0 100 0 ....................

2 ............... 4,981 12,951 1,263 23,996 .................... 0 100 0 ....................

3 ............... 4,307 13,102 1,185 23,454 542 0 40 60 2.1 

4 ............... 4,192 13,384 1,193 23,803 41 36 13 51 6.6 

5 ............... 4,011 17,093 1,341 28,775 ¥4,937 100 0 0 364.7 

* Percentages may not add up to 100 percent due to rounding. 

TABLE V.9—SUMMARY LCC AND PBP RESULTS FOR VCT.RC.L EQUIPMENT CLASS* 

TSL 

Annual energy consumption 

kWh/yr 

Life-cycle cost, all customers 

2012$ 

Life-cycle cost savings 

Median 

payback 

period 

years Installed 

cost 

Discounted 

operating 

cost 

LCC 

Affected 

customers’ 

average 

savings 

2012$ 

% of Customers that experience** 

Net cost 

(percent) 

No impact 

(percent) 

Net benefit 

(percent) 

1 ............... 12,898 14,411 2,081 32,705 647 0 40 60 1.8 

2 ............... 12,898 14,411 2,081 32,705 647 0 40 60 1.8 

3 ............... 12,694 14,508 2,066 32,665 526 4 20 76 2.7 

4 ............... 12,593 14,809 2,070 32,996 93 43 0 57 6.3 

5 ............... 12,061 19,567 2,232 39,125 ¥6,036 100 0 0 194.7 

* Percentages may not add up to 100 percent due to rounding. 

TABLE V.10—SUMMARY LCC AND PBP RESULTS FOR VCT.SC.M EQUIPMENT CLASS* 

TSL 

Annual 

energy 

consumption 

kWh/yr 

Life-cycle cost, all customers 

2012$ 

Life-cycle cost savings 

Median 

payback 

period 

years Installed 

cost 

Discounted 

operating 

cost 

LCC 

Affected 

customers’ 

average 

savings 

2012$ 

% of Customers that experience** 

Net cost 

(percent) 

No impact 

(percent) 

Net benefit 

(percent) 

1 ............... 2,491 5,184 490 10,025 ¥10 71 10 18 23.4 

2 ............... 2,184 5,336 452 9,800 214 1 10 89 4.8 

3 ............... 2,057 5,401 442 9,767 226 3 0 97 5.3 

4 ............... 1,991 5,487 440 9,830 163 17 0 83 7.0 

5 ............... 1,879 6,831 478 11,534 ¥1,541 100 0 0 96.2 

* Percentages may not add up to 100 percent due to rounding. 

TABLE V.11—SUMMARY LCC AND PBP RESULTS FOR VCT.SC.L EQUIPMENT CLASS

TSL 

Annual energy consumption 

kWh/yr 

Life-cycle cost, all customers 

2012$ 

Life-cycle cost savings 

Median 

payback 

period 

years Installed 

cost 

Discounted 

operating 

cost 

LCC 

Affected 

customers’ 

average 

savings 

2012$ 

90 of Customers that experience ** 

Net cost 

(percent) 

No impact 

(percent) 

Net benefit 

(percent) 

1 ............... 10,022 6,498 1,270 19,135 2,503 0 10 90 0.5 


tkelley on DSK3SPTVN1PROD with RULES2
17786 Federal Register / Vol. 79, No. 60 / Friday, March 28, 2014 / Rules and Regulations 

TABLE V.11—SUMMARY LCC AND PBP RESULTS FOR VCT.SC.L EQUIPMENT CLASS—Continued 

TSL 

Annual energy consumption 

kWh/yr 

Life-cycle cost, all customers 

2012$ 

Life-cycle cost savings 

Median 

payback 

period 

years Installed 

cost 

Discounted 

operating 

cost 

LCC 

Affected 

customers’ 

average 

savings 

2012$ 

90 of Customers that experience ** 

Net cost 

(percent) 

No impact 

(percent) 

Net benefit 

(percent) 

2 ............... 6,654 6,822 964 16,397 4,709 0 0 100 0.8 

3 ............... 6,262 7,003 917 16,105 5,001 0 0 100 1.1 

4 ............... 5,857 8,909 948 18,294 2,812 11 0 89 4.7 

5 ............... 5,857 8,909 948 18,294 2,812 11 0 89 4.7 

* Percentages may not add up to 100 percent due to rounding. 

TABLE V.12—SUMMARY LCC AND PBP RESULTS FOR VCT.SC.I EQUIPMENT CLASS * 

TSL 

Annual energy consumption 

kWh/yr 

Life-cycle cost, all customers 

2012$ 

Life-cycle cost savings 

Median 

payback 

period 

years Installed 

cost 

Discounted 

operating 

cost 

LCC 

Affected 

customers’ 

average 

savings 

2012$ 

90 of Customers that experience ** 

Net cost 

(percent) 

No impact 

(percent) 

Net benefit 

(percent) 

1 ............... 7,124 7,305 1,015 17,384 18 10 40 50 7.2 

2 ............... 7,124 7,305 1,015 17,384 18 10 40 50 7.2 

3 ............... 7,124 7,305 1,015 17,384 18 10 40 50 7.2 

4 ............... 6,916 7,509 1,003 17,468 ¥68 65 24 11 16.2 

5 ............... 6,609 9,780 1,057 20,242 ¥2,834 84 16 0 663.6 

* Percentages may not add up to 100 percent due to rounding. 

TABLE V.13—SUMMARY LCC AND PBP RESULTS FOR VCS.SC.M EQUIPMENT CLASS * 

TSL 

Annual energy consumption 

kWh/yr 

Life-cycle cost, all customers 

2012$ 

Life-cycle cost savings 

Median 

payback 

period 

years Installed 

cost 

Discounted 

operating 

cost 

LCC 

Affected 

customers’ 

average 

savings 

2012$ 

% of Customers that experience ** 

Net cost 

(percent) 

No impact 

(percent) 

Net benefit 

(percent) 

1 ............... 1,929 3,572 368 6,378 223 0 40 60 0.5 

2 ............... 1,469 3,601 326 6,083 518 0 40 60 0.6 

3 ............... 1,346 3,651 318 6,067 363 7 10 83 1.4 

4 ............... 1,258 3,734 314 6,125 305 25 10 65 2.6 

5 ............... 1,105 5,062 365 7,828 ¥1,428 100 0 0 48.0 

* Percentages may not add up to 100 percent due to rounding. 

TABLE V.14—SUMMARY LCC AND PBP RESULTS FOR VCS.SC.L EQUIPMENT CLASS * 

TSL 

Annual energy consumption 

kWh/yr 

Life-cycle cost, all customers 

2012$ 

Life-cycle cost savings 

Median 

payback 

period 

years Installed 

cost 

Discounted 

operating 

cost 

LCC 

Affected 

customers’ 

average 

savings 

2012$ 

% of Customers that experience ** 

Net cost 

(percent) 

No impact 

(percent) 

Net benefit 

(percent) 

1 ............... 5,088 4,007 702 9,374 588 0 40 60 0.6 

2 ............... 4,722 4,083 672 9,215 550 0 10 90 1.3 

3 ............... 4,448 4,216 653 9,201 507 7 0 93 2.5 

4 ............... 4,410 4,238 651 9,213 495 9 0 91 2.7 

5 ............... 4,062 5,988 703 11,349 ¥1,640 100 0 0 31.8 

* Percentages may not add up to 100 percent due to rounding. 


tkelley on DSK3SPTVN1PROD with RULES2
Federal Register / Vol. 79, No. 60 / Friday, March 28, 2014 / Rules and Regulations 17787 

TABLE V.15—SUMMARY LCC AND PBP RESULTS FOR VCS.SC.I EQUIPMENT CLASS * 

TSL 

Annual energy consumption 

kWh/yr 

Life-cycle cost, all customers 

2012$ 

Life-cycle cost savings 

Median 

payback 

period 

years Installed 

cost 

Discounted 

operating 

cost 

LCC 

Affected 

customers’ 

average 

savings 

2012$ 

% of Customers that experience ** 

Net cost 

(percent) 

No impact 

(percent) 

Net benefit 

(percent) 

1 ............... 6,824 4,349 895 11,195 41 0 40 60 2.6 

2 ............... 6,574 4,420 876 11,117 114 0 32 68 3.6 

3 ............... 6,361 4,515 861 11,096 113 9 17 75 5.0 

4 ............... 6,361 4,515 861 11,096 113 9 17 75 5.0 

5 ............... 5,855 6,839 927 13,909 ¥2,710 92 8 0 183.7 

* Percentages may not add up to 100 percent due to rounding. 

TABLE V.16—SUMMARY LCC AND PBP RESULTS FOR SVO.RC.M EQUIPMENT CLASS * 

TSL 

Annual energy consumption 

kWh/yr 

Life-cycle cost, all customers 

2012$ 

Life-cycle cost savings 

Median 

payback 

period 

years Installed 

cost 

Discounted 

operating 

cost 

LCC 

Affected 

customers’ 

average 

savings 

2012$ 

% of Customers that experience ** 

Net cost 

(percent) 

No impact 

(percent) 

Net benefit 

(percent) 

1 ............... 10,748 10,304 1,694 24,841 564 7 40 54 6.2 

2 ............... 10,748 10,304 1,694 24,841 564 7 40 54 6.2 

3 ............... 10,748 10,304 1,694 24,841 564 7 40 54 6.2 

4 ............... 10,226 10,875 1,670 25,201 ¥19 67 0 33 10.4 

5 ............... 10,111 12,867 1,752 27,873 ¥2,691 100 0 0 29.9 

* Percentages may not add up to 100 percent due to rounding. 

TABLE V.17—SUMMARY LCC AND PBP RESULTS FOR SVO.SC.M EQUIPMENT CLASS§* 

TSL 

Annual energy consumption 

kWh/yr 

Life-cycle cost, all customers 

2012$ 

Life-cycle cost savings 

Median 

payback 

period 

years Installed 

cost 

Discounted 

operating 

cost 

LCC 

Affected 

customers’ 

average 

savings 

2012$ 

% of Customers that experience§** 

Net cost 

(percent) 

No impact 

(percent) 

Net benefit 

(percent) 

1 ............... 9,608 4,980 1,150 16,733 .................... 0 100 0 ....................

2 ............... 9,608 4,980 1,150 16,733 .................... 0 100 0 ....................

3 ............... 9,608 4,980 1,150 16,733 .................... 0 100 0 ....................

4 ............... 9,361 5,157 1,132 16,728 6 32 40 27 10.9 

5 ............... 9,271 5,897 1,151 17,648 ¥917 100 0 0 151.6 

* Percentages may not add up to 100 percent due to rounding. 

TABLE V.18—SUMMARY LCC AND PBP RESULTS FOR SOC.RC.M EQUIPMENT CLASS * 

TSL 

Annual energy consumption 

kWh/yr 

Life-cycle cost, all customers 

2012$ 

Life-cycle cost savings 

Median 

payback 

period 

years Installed 

cost 

Discounted 

operating 

cost 

LCC 

Affected 

customers’ 

average 

savings 

2012$ 

% of Customers that experience ** 

Net cost 

(percent) 

No impact 

(percent) 

Net benefit 

(percent) 

1 ............... 8,300 13,971 1,679 28,172 .................... 0 100 0 ....................

2 ............... 8,300 13,971 1,679 28,172 .................... 0 100 0 ....................

3 ............... 8,300 13,971 1,679 28,172 .................... 0 100 0 ....................

4 ............... 8,144 14,144 1,674 28,301 ¥128 60 40 0 38.0 

5 ............... 7,869 15,879 1,729 30,492 ¥2,268 100 0 0 114.1 

* Percentages may not add up to 100 percent due to rounding. 


tkelley on DSK3SPTVN1PROD with RULES2
17788 Federal Register / Vol. 79, No. 60 / Friday, March 28, 2014 / Rules and Regulations 

TABLE V.19—SUMMARY LCC AND PBP RESULTS FOR SOC.SC.M EQUIPMENT CLASS * 

TSL 

Annual energy consumption 

kWh/yr 

Life-cycle cost, all customers 

2012$ 

Life-cycle cost savings 

Median 

payback 

period 

years Installed 

cost 

Discounted 

operating 

cost 

LCC 

Affected 

customers’ 

average 

savings 

2012$ 

% of Customers that experience ** 

Net cost 

(percent) 

No impact 

(percent) 

Net benefit 

(percent) 

1 ............... 10,119 13,965 1,821 27,861 .................... 0 100 0 ....................

2 ............... 10,119 13,965 1,821 27,861 .................... 0 100 0 ....................

3 ............... 10,119 13,965 1,821 27,861 .................... 0 100 0 ....................

4 ............... 9,711 14,332 1,808 28,128 ¥209 100 0 1 28.7 

5 ............... 9,533 15,880 1,868 30,123 ¥2,204 100 0 0 25.3 

* Percentages may not add up to 100 percent due to rounding. 

TABLE V.20—SUMMARY LCC AND PBP RESULTS FOR HZO.RC.M EQUIPMENT CLASS * 

TSL 

Annual energy consumption 

kWh/yr 

Life-cycle cost, all customers 

2012$ 

Life-cycle cost savings 

Median 

payback 

period 

years Installed 

cost 

Discounted 

operating 

cost 

LCC 

Affected 

customers’ 

average 

savings 

2012$ 

% of Customers that experience ** 

Net cost 

(percent) 

No impact 

(percent) 

Net benefit 

(percent) 

1 ............... 5,282 8,290 1,036 16,958 .................... 0 100 0 ....................

2 ............... 5,282 8,290 1,036 16,958 .................... 0 100 0 ....................

3 ............... 5,282 8,290 1,036 16,958 .................... 0 100 0 ....................

4 ............... 5,282 8,290 1,036 16,958 .................... 0 100 0 ....................

5 ............... 5,165 9,921 1,103 19,137 ¥2,180 60 40 0 ....................

* Percentages may not add up to 100 percent due to rounding. 

TABLE V.21—SUMMARY LCC AND PBP RESULTS FOR HZO.RC.L EQUIPMENT CLASS * 

TSL 

Annual energy consumption 

kWh/yr 

Life-cycle cost, all customers 

2012$ 

Life-cycle cost savings 

Median 

payback 

period 

years Installed 

cost 

Discounted 

operating 

cost 

LCC 

Affected 

customers’ 

average 

savings 

2012$ 

% of Customers that experience ** 

Net cost 

(percent) 

No impact 

(percent) 

Net benefit 

(percent) 

1 ............... 11,812 8,504 1,673 22,548 .................... 0 100 0 ....................

2 ............... 11,812 8,504 1,673 22,548 .................... 0 100 0 ....................

3 ............... 11,812 8,504 1,673 22,548 .................... 0 100 0 ....................

4 ............... 11,812 8,504 1,673 22,548 .................... 0 100 0 ....................

5 ............... 11,344 11,822 1,787 26,795 ¥4,249 60 40 0 288.9 

* Percentages may not add up to 100 percent due to rounding. 

TABLE V.22—SUMMARY LCC AND PBP RESULTS FOR HZO.SC.M EQUIPMENT CLASS * 

TSL 

Annual energy consumption 

kWh/yr 

Life-cycle cost, all customers 

2012$ 

Life-cycle cost savings 

Median 

payback 

period 

years Installed 

cost 

Discounted 

operating 

cost 

LCC 

Affected 

customers’ 

average 

savings 

2012$ 

% of Customers that experience ** 

Net cost 

(percent) 

No impact 

(percent) 

Net benefit 

(percent) 

1 ............... 5,351 2,605 629 9,022 .................... 0 100 0 ....................

2 ............... 5,168 2,698 615 8,967 55 5 40 54 6.9 

3 ............... 5,168 2,698 615 8,967 55 5 40 54 6.9 

4 ............... 5,118 2,763 613 9,013 ¥4 50 21 29 11.8 

5 ............... 5,018 3,689 636 10,163 ¥1,154 100 0 0 194.7 

* Percentages may not add up to 100 percent due to rounding. 


tkelley on DSK3SPTVN1PROD with RULES2
Federal Register / Vol. 79, No. 60 / Friday, March 28, 2014 / Rules and Regulations 17789 

TABLE V.23—SUMMARY LCC AND PBP RESULTS FOR HZO.SC.M EQUIPMENT CLASS * 

TSL 

Annual energy consumption 

kWh/yr 

Life-cycle cost, all customers 

2012$ 

Life-cycle cost savings 

Median 

payback 

period 

years Installed 

cost 

Discounted 

operating 

cost 

LCC 

Affected 

customers’ 

average 

savings 

2012$ 

% of Customers that experience ** 

Net cost 

(percent) 

No impact 

(percent) 

Net benefit 

(percent) 

1 ............... 10,922 5,008 1,265 17,894 .................... 0 100 0 ....................

2 ............... 10,922 5,008 1,265 17,894 .................... 0 100 0 ....................

3 ............... 10,922 5,008 1,265 17,894 .................... 0 100 0 ....................

4 ............... 10,922 5,008 1,265 17,894 .................... 0 100 0 ....................

5 ............... 10,922 5,008 1,265 17,894 .................... 0 100 0 ....................

* Percentages may not add up to 100 percent due to rounding. 

TABLE V.24—SUMMARY LCC AND PBP RESULTS FOR HCT.SC.M EQUIPMENT CLASS

TSL 

Annual 

energy 

consumption 

kWh/yr 

Life-cycle cost, all customers 

2012$ 

Life-cycle cost savings 

Median 

payback 

period 

years Installed 

cost 

Discounted 

operating 

cost 

LCC 

Affected 

customers’ 

average 

savings 

2012$ 

% of Customers that experience ** 

Net 

cost 

(percent) 

No impact 

(percent) 

Net 

benefit 

(percent) 

1 ............... 590 2,101 140 3,577 66 0 40 60 2.5 

2 ............... 360 2,198 122 3,478 165 0 40 60 4.7 

3 ............... 327 2,213 120 3,476 101 20 0 80 5.8 

4 ............... 289 2,279 120 3,534 43 45 0 55 9.2 

5 ............... 224 2,807 131 4,175 ¥599 100 0 0 46.6 

* Percentages may not add up to 100 percent due to rounding. 

TABLE V.25—SUMMARY LCC AND PBP RESULTS FOR HCT.SC.L EQUIPMENT CLASS * 

TSL 

Annual 

energy 

consumption 

kWh/yr 

Life-cycle cost, all customers 

2012$ 

Life-cycle cost savings 

Median 

payback 

period 

years Installed 

cost 

Discounted 

operating 

cost 

LCC 

Affected 

customers’ 

average 

savings 

2012$ 

% of Customers that experience ** 

Net 

cost 

(percent) 

No impact 

(percent) 

Net 

benefit 

(percent) 

1 ............... 785 2,297 190 3,882 428 0 41 59 1.8 

2 ............... 742 2,312 187 3,876 435 0 41 59 2.0 

3 ............... 701 2,330 185 3,870 293 10 10 80 2.5 

4 ............... 632 2,399 182 3,915 248 29 10 61 3.6 

5 ............... 480 3,120 200 4,775 ¥613 87 10 3 19.5 

** Percentages may not add up to 100 percent due to rounding. 

TABLE V.26—SUMMARY LCC AND PBP RESULTS FOR HCT.SC.I EQUIPMENT CLASS * 

TSL 

Annual 

energy 

consumption 

kWh/yr 

Life-cycle cost, all customers 

2012$ 

Life-cycle cost savings 

Median 

payback 

period 

years Installed 

cost 

Discounted 

operating 

cost 

LCC 

Affected 

customers’ 

average 

savings 

2012$ 

% of Customers that experience** 

Net 

cost 

(percent) 

No impact 

(percent) 

Net 

benefit 

(percent) 

1 ............... 1,141 2,490 240 4,348 .................... 0 100 0 ....................

2 ............... 1,141 2,490 240 4,348 .................... 0 100 0 ....................

3 ............... 1,141 2,490 240 4,348 .................... 0 100 0 ....................

4 ............... 1,141 2,490 240 4,348 .................... 0 100 0 ....................

5 ............... 849 3,553 264 5,587 ¥1,240 61 39 0 23.8 

* Percentages may not add up to 100 percent due to rounding. 


tkelley on DSK3SPTVN1PROD with RULES2
17790 Federal Register / Vol. 79, No. 60 / Friday, March 28, 2014 / Rules and Regulations 

TABLE V.27—SUMMARY LCC AND PBP RESULTS FOR HCS.SC.M EQUIPMENT CLASS * 

TSL 

Annual 

energy 

consumption 

kWh/yr 

Life-cycle cost, all customers 

2012$ 

Life-cycle cost savings 

Median 

payback 

period 

years Installed 

cost 

Discounted 

operating 

cost 

LCC 

Affected 

customers’ 

average 

savings 

2012$ 

% of Customers that experience ** 

Net 

cost 

(percent) 

No impact 

(percent) 

Net 

benefit 

(percent) 

1 ............... 518 1,986 146 3,100 12 0 9 91 2.9 

2 ............... 495 1,993 145 3,095 17 1 9 90 3.7 

3 ............... 466 2,008 143 3,097 15 10 9 80 5.5 

4 ............... 461 2,014 144 3,107 5 42 9 48 7.5 

5 ............... 358 2,488 157 3,679 ¥568 91 9 0 680.6 

* Percentages may not add up to 100 percent due to rounding. 

TABLE V.28—SUMMARY LCC AND PBP RESULTS FOR HCS.SC.L EQUIPMENT CLASS * 

TSL 

Annual 

energy 

consumption 

kWh/yr 

Life-cycle cost, all customers 

2012$ 

Life-cycle cost savings 

Median 

payback 

period 

years Installed 

cost 

Discounted 

operating 

cost 

LCC 

Affected 

customers’ 

average 

savings 

2012$ 

% of Customers that experience ** 

Net 

cost 

(percent) 

No impact 

(percent) 

Net 

benefit 

(percent) 

1 ............... 650 2,006 160 3,224 31 0 10 90 1.4 

2 ............... 609 2,013 156 3,205 50 0 10 90 1.7 

3 ............... 558 2,028 153 3,191 64 0 10 90 2.5 

4 ............... 472 2,093 148 3,222 33 20 10 70 6.2 

5 ............... 260 2,663 156 3,845 ¥590 90 10 0 68.9 

* Percentages may not add up to 100 percent due to rounding. 

TABLE V.29—SUMMARY LCC AND PBP RESULTS FOR PD.SC.M EQUIPMENT CLASS * 

TSL 

Annual 

energy 

consumption 

kWh/yr 

Life-cycle cost, all customers 

2012$ 

Life-cycle cost savings 

Median 

payback 

period 

years Installed 

cost 

Discounted 

operating 

cost 

LCC 

Affected 

customers’ 

average 

savings 

2012$ 

% of Customers that experience ** 

Net 

cost 

(percent) 

No impact 

(percent) 

Net 

benefit 

(percent) 

1 ............... 1,726 3,502 342 6,732 8 28 39 33 9.3 

2 ............... 1,422 3,654 310 6,574 163 3 0 97 5.3 

3 ............... 1,381 3,677 308 6,572 165 5 0 95 5.6 

4 ............... 1,369 3,691 308 6,587 150 8 0 92 6.0 

5 ............... 1,243 4,808 340 7,989 ¥1,252 100 0 0 102.2 

* Percentages may not add up to 100 percent due to rounding. 

b. Customer Subgroup Analysis 

As described in section IV.I, DOE 

estimated the impact of potential 

amended efficiency standards for 

commercial refrigeration equipment on 

two representative customer subgroups: 

full-service restaurants and convenience 

stores with gas stations. 

The results for full-service restaurants 

are presented only for the self-contained 

equipment classes because full-service 

restaurants that are small businesses 

generally do not use remote condensing 

equipment. Table V.30 presents the 

comparison of mean LCC savings for the 

subgroup with the values for all CRE 

customers. For all TSLs in all 

equipment classes save one, the LCC 

savings for this subgroup are higher (or 

less negative) than the national average 

values. This can be attributed to the 

longer average lifetimes of CRE used by 

small business customers, and higher 

electricity prices in the case of full 

service restaurants. 

Table V.31 compares median PBPs for 

full-service restaurants with the values 

for all CRE customers. The PBP values 

are lower for the small business 

subgroup in all cases save one, which is 

consistent with the decrease in LCC 

savings. 

TABLE V.30—COMPARISON OF MEAN LCC SAVINGS FOR THE FULL-SERVICE RESTAURANTS SUBGROUP WITH THE

SAVINGS FOR ALL CRE CUSTOMERS

Equipment class Category 

Mean LCC savings 

2012$ * 

TSL 1 TSL 2 TSL 3 TSL 4 TSL 5 

VOP.SC.M .............................................. Small Business ....................................... ................ ................ ................ $(57) $(1,508) 


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Federal Register / Vol. 79, No. 60 / Friday, March 28, 2014 / Rules and Regulations 17791 

TABLE V.30—COMPARISON OF MEAN LCC SAVINGS FOR THE FULL-SERVICE RESTAURANTS SUBGROUP WITH THE

SAVINGS FOR ALL CRE CUSTOMERS—Continued 

Equipment class Category 

Mean LCC savings 

2012$ * 

TSL 1 TSL 2 TSL 3 TSL 4 TSL 5 

All Business Types ................................. ................ ................ ................ $(54) $(1,384) 

VCT.SC.M ............................................... Small Business ....................................... $0 $299 $330 $280 $(1,391) 

All Business Types ................................. $(10) $214 $226 $163 $(1,541) 

VCT.SC.L ................................................ Small Business ....................................... $3,073 $5,868 $6,254 $4,163 $4,163 

All Business Types ................................. $2,503 $4,709 $5,001 $2,812 $2,812 

VCT.SC.I ................................................. Small Business ....................................... $34 $34 $34 $(12) $(2,706) 

All Business Types ................................. $18 $18 $18 $(68) $(2,834) 

VCS.SC.M ............................................... Small Business ....................................... $375 $870 $652 $632 $(1,031) 

All Business Types ................................. $223 $518 $363 $305 $(1,428) 

VCS.SC.L ................................................ Small Business ....................................... $979 $971 $999 $1,000 $(936) 

All Business Types ................................. $588 $550 $507 $495 $(1,640) 

VCS.SC.I ................................................. Small Business ....................................... $81 $257 $321 $321 $(2,241) 

All Business Types ................................. $41 $114 $113 $113 $(2,710) 

SOC.SC.M .............................................. Small Business ....................................... ................ ................ ................ $(74) $(1,952) 

All Business Types ................................. ................ ................ ................ $(209) $(2,204) 

SVO.SC.M .............................................. Small Business ....................................... ................ ................ ................ $53 $(871) 

All Business Types ................................. ................ ................ ................ $6 $(917) 

HZO.SC.M .............................................. Small Business ....................................... ................ $92 $92 $33 $(1,097) 

All Business Types ................................. ................ $55 $55 $(4) $(1,154) 

HZO.SC.L ............................................... Small Business ....................................... ................ ................ ................ ................ ................

All Business Types ................................. ................ ................ ................ ................ ................

HCT.SC.M ............................................... Small Business ....................................... $81 $216 $137 $85 $(546) 

All Business Types ................................. $66 $165 $101 $43 $(599) 

HCT.SC.L ................................................ Small Business ....................................... $687 $707 $487 $468 $(319) 

All Business Types ................................. $428 $435 $293 $248 $(613) 

HCT.SC.I ................................................. Small Business ....................................... ................ ................ ................ ................ $(1,081) 

All Business Types ................................. ................ ................ ................ ................ $(1,240) 

HCS.SC.M .............................................. Small Business ....................................... $23 $38 $48 $38 $(477) 

All Business Types ................................. $12 $17 $15 $5 $(568) 

HCS.SC.L ............................................... Small Business ....................................... $55 $91 $127 $133 $(381) 

All Business Types ................................. $31 $50 $64 $33 $(590) 

TABLE V.31—COMPARISON OF MEDIAN PAYBACK PERIODS FOR THE FULL-SERVICE RESTAURANTS SUBGROUP WITH THE

VALUES FOR ALL CRE CUSTOMERS

Equipment class Category 

Mean LCC savings 

2012$ * 

TSL 1 TSL 2 TSL 3 TSL 4 TSL 5 

VOP.SC.M .............................................. Small Business ....................................... ................ ................ ................ 54.1 541.3 

All Business Types ................................. ................ ................ ................ 63.1 593.2 

VCT.SC.M ............................................... Small Business ....................................... 12.9 4.1 4.5 5.9 64.8 

All Business Types ................................. 23.4 4.8 5.3 7.0 96.2 

VCT.SC.L ................................................ Small Business ....................................... 0.4 0.7 0.9 4.0 4.0 

All Business Types ................................. 0.5 0.8 1.1 4.7 4.7 

VCT.SC.I ................................................. Small Business ....................................... 5.8 5.8 5.8 12.4 310.0 

All Business Types ................................. 7.2 7.2 7.2 16.2 663.6 

VCS.SC.M ............................................... Small Business ....................................... 0.4 0.5 1.2 2.1 22.4 

All Business Types ................................. 0.5 0.6 1.4 2.6 48.0 

VCS.SC.L ................................................ Small Business ....................................... 0.5 1.1 2.0 2.2 19.2 

All Business Types ................................. 0.6 1.3 2.5 2.7 31.8 

VCS.SC.I ................................................. Small Business ....................................... 2.1 2.9 3.9 3.9 91.7 

All Business Types ................................. 2.6 3.6 5.0 5.0 183.7 

SOC.SC.M .............................................. Small Business ....................................... ................ ................ ................ 15.5 221.7 

All Business Types ................................. ................ ................ ................ 28.7 25.3 

SVO.SC.M .............................................. Small Business ....................................... ................ ................ ................ 8.9 124.3 

All Business Types ................................. ................ ................ ................ 10.9 151.6 

HZO.SC.M .............................................. Small Business ....................................... ................ 5.7 5.7 9.5 166.7 

All Business Types ................................. ................ 6.9 6.9 11.8 194.7 

HZO.SC.L ............................................... Small Business ....................................... ................ ................ ................ ................ ................

All Business Types ................................. ................ ................ ................ ................ ................

HCT.SC.M ............................................... Small Business ....................................... 2.1 4.0 4.7 7.5 33.9 

All Business Types ................................. 2.5 4.7 5.8 9.2 46.6 

HCT.SC.L ................................................ Small Business ....................................... 1.5 1.6 2.0 2.9 14.0 

All Business Types ................................. 1.8 2.0 2.5 3.6 19.5 

HCT.SC.I ................................................. Small Business ....................................... ................ ................ ................ ................ 176.3 


tkelley on DSK3SPTVN1PROD with RULES2
17792 Federal Register / Vol. 79, No. 60 / Friday, March 28, 2014 / Rules and Regulations 

TABLE V.31—COMPARISON OF MEDIAN PAYBACK PERIODS FOR THE FULL-SERVICE RESTAURANTS SUBGROUP WITH THE

VALUES FOR ALL CRE CUSTOMERS—Continued 

Equipment class Category 

Mean LCC savings 

2012$ * 

TSL 1 TSL 2 TSL 3 TSL 4 TSL 5 

All Business Types ................................. ................ ................ ................ ................ 23.8 

HCS.SC.M .............................................. Small Business ....................................... 2.3 2.9 4.2 5.4 136.0 

All Business Types ................................. 2.9 3.7 5.5 7.5 680.6 

HCS.SC.L ............................................... Small Business ....................................... 1.1 1.4 2.1 4.7 27.9 

All Business Types ................................. 1.4 1.7 2.5 6.2 68.9 

PD.SC.M ................................................. Small Business ....................................... 6.9 4.5 4.7 5.0 63.3 

All Business Types ................................. 9.3 5.3 5.6 6.0 102.2 

Table V.32 presents the comparison of 

mean LCC savings for convenience 

stores with gasoline stations with the 

national average values at each TSL. 

This comparison shows higher (or less 

negative) LCC savings for the subgroups 

in nearly all instances. 

Table V.33 presents the comparison of 

median PBPs for convenience stores 

with gasoline stations with national 

median values at each TSL. This 

comparison shows lower PBP for the 

subgroup in nearly all cases. 

TABLE V.32—COMPARISON OF MEAN LCC SAVINGS FOR CONVENIENCE STORES WITH GASOLINE STATIONS WITH

SAVINGS FOR ALL CRE CUSTOMERS

Equipment class Category 

Mean LCC savings * 

2012$ 

TSL 1 TSL 2 TSL 3 TSL 4 TSL 5 

VOP.RC.M .............................................. Small Business ....................................... ................ ................ $1,334 $299 $(4,003) 

All Business Types ................................. ................ ................ $922 $(5) $(4,203) 

VOP.RC.L ............................................... Small Business ....................................... ................ ................ $82 $2 $(6,703) 

All Business Types ................................. ................ ................ $53 $(148) $(6,701) 

VOP.SC.M .............................................. Small Business ....................................... ................ ................ ................ $(62) $(1,485) 

All Business Types ................................. ................ ................ ................ $(54) $(1,384) 

VCT.RC.M ............................................... Small Business ....................................... ................ ................ $636 $135 $(4,544) 

All Business Types ................................. ................ ................ $542 $41 $(4,937) 

VCT.RC.L ................................................ Small Business ....................................... $751 $751 $634 $213 $(5,486) 

All Business Types ................................. $647 $647 $526 $93 $(6,036) 

VCT.SC.M ............................................... Small Business ....................................... $(8) $214 $229 $169 $(1,479) 

All Business Types ................................. $(10) $214 $226 $163 $(1,541) 

VCT.SC.L ................................................ Small Business ....................................... $2,489 $4,699 $4,988 $2,878 $2,878 

All Business Types ................................. $2,503 $4,709 $5,001 $2,812 $2,812 

VCT.SC.I ................................................. Small Business ....................................... $19 $19 $19 $(59) $(2,732) 

All Business Types ................................. $18 $18 $18 $(68) $(2,834) 

VCS.SC.M ............................................... Small Business ....................................... $299 $696 $511 $476 $(1,157) 

All Business Types ................................. $223 $518 $363 $305 $(1,428) 

VCS.SC.L ................................................ Small Business ....................................... $785 $765 $763 $758 $(1,190) 

All Business Types ................................. $588 $550 $507 $495 $(1,640) 

VCS.SC.I ................................................. Small Business ....................................... $62 $189 $224 $224 $(2,354) 

All Business Types ................................. $41 $114 $113 $113 $(2,710) 

SVO.RC.M .............................................. Small Business ....................................... $966 $966 $966 $340 $(2,148) 

All Business Types ................................. $564 $564 $564 $(19) $(2,691) 

SVO.SC.M .............................................. Small Business ....................................... ................ ................ ................ $5 $(891) 

All Business Types ................................. ................ ................ ................ $6 $(917) 

SOC.RC.M .............................................. Small Business ....................................... ................ ................ ................ $(93) $(2,058) 

All Business Types ................................. ................ ................ ................ $(128) $(2,268) 

HZO.RC.M ** ........................................... Small Business ....................................... ................ ................ ................ ................ $(2,015) 

All Business Types ................................. ................ ................ ................ ................ $(2,180) 

HZO.RC.L ** ............................................ Small Business ....................................... ................ ................ ................ ................ $(3,880) 

All Business Types ................................. ................ ................ ................ ................ $(4,249) 

HZO.SC.M .............................................. Small Business ....................................... ................ $55 $55 $(3) $(1,114) 

All Business Types ................................. ................ $55 $55 $(4) $(1,154) 

HZO.SC.L ** ............................................ Small Business ....................................... ................ ................ ................ ................ ................

All Business Types ................................. ................ ................ ................ ................ ................

HCT.SC.M ............................................... Small Business ....................................... $62 $151 $92 $35 $(591) 

All Business Types ................................. $66 $165 $101 $43 $(599) 

HCT.SC.L ................................................ Small Business ....................................... $535 $548 $374 $343 $(451) 

All Business Types ................................. $428 $435 $293 $248 $(613) 

HCT.SC.I ................................................. Small Business ....................................... ................ ................ ................ ................ $(1,106) 

All Business Types ................................. ................ ................ ................ ................ $(1,240) 

HCS.SC.M .............................................. Small Business ....................................... $18 $28 $32 $23 $(498) 

All Business Types ................................. $12 $17 $15 $5 $(568) 


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Federal Register / Vol. 79, No. 60 / Friday, March 28, 2014 / Rules and Regulations 17793 

TABLE V.32—COMPARISON OF MEAN LCC SAVINGS FOR CONVENIENCE STORES WITH GASOLINE STATIONS WITH

SAVINGS FOR ALL CRE CUSTOMERS—Continued 

Equipment class Category 

Mean LCC savings * 

2012$ 

TSL 1 TSL 2 TSL 3 TSL 4 TSL 5 

HCS.SC.L ............................................... Small Business ....................................... $44 $71 $97 $87 $(453) 

All Business Types ................................. $31 $50 $64 $33 $(590) 

PD.SC.M ................................................. Small Business ....................................... $14 $186 $190 $177 $(1,159) 

All Business Types ................................. $8 $163 $165 $150 $(1,252) 

TABLE V.33—COMPARISON OF MEDIAN PAYBACK PERIODS FOR CONVENIENCE STORES WITH GASOLINE STATIONS WITH

VALUES FOR ALL CRE CUSTOMERS

Equipment class Category 

Median payback period 

years 

TSL1 TSL2 TSL3 TSL4 TSL5 

VOP.RC.M .............................................. Small Business ....................................... ................ ................ 5.5 9.0 25.1 

All Business Types ................................. ................ ................ 5.7 9.9 34.1 

VOP.RC.L ............................................... Small Business ....................................... ................ ................ 5.8 10.2 195.3 

All Business Types ................................. ................ ................ 6.1 11.3 310.0 

VOP.SC.M .............................................. Small Business ....................................... ................ ................ ................ 69.5 513.9 

All Business Types ................................. ................ ................ ................ 63.1 593.2 

VCT.RC.M ............................................... Small Business ....................................... ................ ................ 1.9 5.8 308.8 

All Business Types ................................. ................ ................ 2.1 6.6 364.7 

VCT.RC.L ................................................ Small Business ....................................... 1.7 1.7 2.5 5.7 171.0 

All Business Types ................................. 1.8 1.8 2.7 6.3 194.7 

VCT.SC.M ............................................... Small Business ....................................... 18.2 4.5 5.0 6.5 82.7 

All Business Types ................................. 23.4 4.8 5.3 7.0 96.2 

VCT.SC.L ................................................ Small Business ....................................... 0.4 0.8 1.0 4.4 4.4 

All Business Types ................................. 0.5 0.8 1.1 4.7 4.7 

VCT.SC.I ................................................. Small Business ....................................... 6.6 6.6 6.6 14.3 531.1 

All Business Types ................................. 7.2 7.2 7.2 16.2 663.6 

VCS.SC.M ............................................... Small Business ....................................... 0.5 0.6 1.3 2.3 26.4 

All Business Types ................................. 0.5 0.6 1.4 2.6 48.0 

VCS.SC.L ................................................ Small Business ....................................... 0.5 1.2 2.2 2.4 22.2 

All Business Types ................................. 0.6 1.3 2.5 2.7 31.8 

VCS.SC.I ................................................. Small Business ....................................... 2.3 3.2 4.3 4.3 118.4 

All Business Types ................................. 2.6 3.6 5.0 5.0 183.7 

SVO.RC.M .............................................. Small Business ....................................... 5.4 5.4 5.4 8.4 20.7

All Business Types ................................. 6.2 6.2 6.2 10.4 29.9 

SVO.SC.M .............................................. Small Business ....................................... ................ ................ ................ 10.0 150.5 

All Business Types ................................. ................ ................ ................ 10.9 151.6 

SOC.RC.M .............................................. Small Business ....................................... ................ ................ ................ 23.2 656.6 

All Business Types ................................. ................ ................ ................ 38.0 114.1 

SOC.SC.M .............................................. Small Business ....................................... ................ ................ ................ 18.2 265.4 

All Business Types ................................. ................ ................ ................ 28.7 25.3 

HZO.RC.M .............................................. Small Business ....................................... ................ ................ ................ ................ ................

All Business Types ................................. ................ ................ ................ ................ ................

HZO.RC.L ............................................... Small Business ....................................... ................ ................ ................ ................ 59.8 

All Business Types ................................. ................ ................ ................ ................ 288.9 

HZO.SC.M .............................................. Small Business ....................................... ................ 6.4 6.4 10.8 174.0 

All Business Types ................................. ................ 6.9 6.9 11.8 194.7 

HZO.SC.L ............................................... Small Business ....................................... ................ ................ ................ ................ ................

All Business Types ................................. ................ ................ ................ ................ ................

HCT.SC.M ............................................... Small Business ....................................... 2.3 4.4 5.4 8.5 40.5 

All Business Types ................................. 2.5 4.7 5.8 9.2 46.6 

HCT.SC.L ................................................ Small Business ....................................... 1.7 1.8 2.3 3.3 15.6 

All Business Types ................................. 1.8 2.0 2.5 3.6 19.5 

HCT.SC.I ................................................. Small Business ....................................... ................ ................ ................ ................ 208.9 

All Business Types ................................. ................ ................ ................ ................ 23.8 

HCS.SC.M .............................................. Small Business ....................................... 2.6 3.3 4.7 6.2 151.6 

All Business Types ................................. 2.9 3.7 5.5 7.5 680.6 

HCS.SC.L ............................................... Small Business ....................................... 1.3 1.6 2.3 5.3 33.7 

All Business Types ................................. 1.4 1.7 2.5 6.2 68.9 

PD.SC.M ................................................. Small Business ....................................... 8.0 4.9 5.2 5.6 78.9 

All Business Types ................................. 9.3 5.3 5.6 6.0 102.2 


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17794 Federal Register / Vol. 79, No. 60 / Friday, March 28, 2014 / Rules and Regulations 

c. Rebuttable Presumption Payback 

As discussed in section IV.F.12, EPCA 

provides a rebuttable presumption that 

a given standard is economically 

justified if the increased purchase cost 

for a product that meets the standard is 

less than three times the value of the 

first-year energy savings resulting from 

the standard. However, DOE routinely 

conducts a full economic analysis that 

considers the full range of impacts, 

including those to the customer, 

manufacturer, Nation, and environment, 

as required under 42 U.S.C. 

6295(o)(2)(B)(i) and 42 U.S.C. 

6316(e)(1). The results of this analysis 

serve as the basis for DOE to evaluate 

definitively the economic justification 

for a potential standard level (thereby 

supporting or rebutting the results of 

any preliminary determination of 

economic justification). Therefore, if the 

rebuttable presumption is not met, DOE 

may justify its standard on another 

basis. 

Table V.34 shows the rebuttable 

payback periods analysis for each 

equipment class. 

TABLE V.34—SUMMARY OF RESULTS FOR COMMERCIAL REFRIGERATION EQUIPMENT TSLS: REBUTTABLE MEDIAN

PAYBACK PERIOD

Median Payback Period 

years 

Equipment class TSL 1 TSL 2 TSL 3 TSL 4 TSL 5 

VOP.RC.M ........................................................................... ........................ ........................ 5.1 7.6 17.3 

VOP.RC.L ............................................................................ ........................ ........................ 4.6 7.3 36.2 

VOP.SC.M ............................................................................ ........................ ........................ ........................ 21.2 127.9 

VCT.RC.M ............................................................................ ........................ ........................ 2.5 6.8 56.3 

VCT.RC.L ............................................................................. 2.2 2.2 3.0 6.6 43.0 

VCT.SC.M ............................................................................ 4.4 5.4 5.5 6.5 28.1 

VCT.SC.L ............................................................................. 0.5 0.8 1.1 4.2 4.2 

VCT.SC.I .............................................................................. 5.0 5.0 5.0 9.5 48.7 

VCS.SC.M ............................................................................ 0.4 0.6 1.2 2.1 16.5 

VCS.SC.L ............................................................................. 0.5 1.2 2.1 2.3 13.6 

VCS.SC.I .............................................................................. 2.3 3.0 3.8 3.8 28.7 

SVO.RC.M ........................................................................... 5.4 5.4 5.4 7.8 16.5 

SVO.SC.M ............................................................................ ........................ ........................ ........................ 8.1 35.9 

SOC.RC.M ........................................................................... ........................ ........................ ........................ 12.4 54.3 

SOC.SC.M ........................................................................... ........................ ........................ ........................ 10.2 39.8 

HZO.RC.M ........................................................................... ........................ ........................ ........................ ........................ 156.3 

HZO.RC.L ............................................................................ ........................ ........................ ........................ ........................ 79.5 

HZO.SC.M ............................................................................ ........................ 5.6 5.6 8.1 42.9 

HZO.SC.L ............................................................................. ........................ ........................ ........................ ........................ ........................

HCT.SC.M ............................................................................ 2.2 4.0 4.4 6.6 20.9 

HCT.SC.L ............................................................................. 1.7 1.8 2.2 3.0 11.4 

HCT.SC.I .............................................................................. ........................ ........................ ........................ ........................ 40.8 

HCS.SC.M ............................................................................ 2.5 2.9 4.0 4.5 30.5 

HCS.SC.L ............................................................................. 1.3 1.6 2.2 4.5 16.7 

PD.SC.M .............................................................................. 4.9 5.4 5.5 5.7 26.7 

2. Economic Impacts on Manufacturers 

DOE performed an MIA to estimate 

the impact of amended energy 

conservation standards on 

manufacturers of commercial 

refrigeration equipment. The following 

section describes the expected impacts 

on manufacturers at each TSL. Chapter 

12 of the final rule TSD explains the 

analysis in further detail. 

a. Industry Cash-Flow Analysis Results 

The following tables depict the 

financial impacts (represented by 

changes in INPV) of amended energy 

standards on manufacturers as well as 

the conversion costs that DOE estimates 

manufacturers would incur for all 

equipment classes at each TSL. To 

evaluate the range of cash flow impacts 

on the commercial refrigeration 

industry, DOE modeled two different 

scenarios using different assumptions 

for markups that correspond to the 

range of anticipated market responses to 

amended standards. 

To assess the lower (less severe) end 

of the range of potential impacts, DOE 

modeled a preservation of gross margin 

percentage markup scenario, in which a 

uniform ‘‘gross margin percentage’’ 

markup was applied across all potential 

efficiency levels. In this scenario, DOE 

assumed that a manufacturer’s absolute 

dollar markup would increase as 

production costs increase in the 

amended standards case. Manufacturers 

have indicated that it is optimistic to 

assume that they would be able to 

maintain the same gross margin 

percentage markup as their production 

costs increase in response to an 

amended efficiency standard, 

particularly at higher TSLs. To assess 

the higher (more severe) end of the 

range of potential impacts, DOE 

modeled the preservation of operating 

profit markup scenario, which assumes 

that manufacturers would be able to 

earn the same operating margin in 

absolute dollars in the amended 

standards case as in the base case. Table 

V.35 and Table V.36 show the potential 

INPV impacts for commercial 

refrigeration equipment manufacturers 

at each TSL: Table V.35 reflects the 

lower bound of impacts and Table V.36 

represents the upper bound. 

Each of the modeled scenarios results 

in a unique set of cash flows and 

corresponding industry values at each 

TSL. In the following discussion, the 

INPV results refer to the difference in 

industry value between the base case 

and each potential amended standards 

case that results from the sum of 

discounted cash flows from the base 

year 2013 through 2046, the end of the 

analysis period. To provide perspective 

on the short-run cash flow impact, DOE 

includes in the discussion of the results 

below a comparison of free cash flow 

between the base case and the standards 


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case at each TSL in the year before 

amended standards take effect. 

TABLE V.35—MANUFACTURER IMPACT ANALYSIS FOR COMMERCIAL REFRIGERATION EQUIPMENT—PRESERVATION OF

GROSS MARGIN PERCENTAGE MARKUP SCENARIO * 

Units Base 

case 

Trial standard level 

1 2 3 4 5 

INPV .................................... 2012$ Millions .................... 2,660.0 2,650 .1 2,651 .3 2,566 .1 2,470 .6 2,475 .6 

Change in INPV .................. 2012$ Millions .................... ................ (9 .9) (8 .7) (93 .9) (189 .4) (184 .4) 

(%) ...................................... ................ (0 .37) (0 .33) (3 .53) (7 .12) (6 .93) 

Product Conversion Costs .. 2012$ Millions .................... ................ 20 .6 32 .1 125 .9 194 .2 282 .1 

Capital Conversion Costs ... 2012$ Millions .................... ................ 3 .5 3 .6 58 .1 160 .7 499 .7 

Total Conversion Costs ...... 2012$ Millions .................... ................ 24 .1 35 .6 184 .0 354 .9 781 .8 

* Values in parentheses are negative values. 

TABLE V.36—MANUFACTURER IMPACT ANALYSIS FOR COMMERCIAL REFRIGERATION EQUIPMENT—PRESERVATION OF

OPERATING PROFIT MARKUP SCENARIO * 

Units Base 

case 

Trial standard level 

1 2 3 4 5 

INPV .................................... 2012$ Millions .................... 2,660.0 2,636 .1 2,617 .1 2,495 .0 2,339 .1 1,515 .2 

Change in INPV .................. 2012$ Millions .................... ................ (23 .9) (42 .9) (165 .0) (320 .9) (1,144 .8) 

(%) ...................................... ................ (0 .90) (1 .61) (6 .20) (12 .07) (43 .04) 

Product Conversion Costs .. 2012$ Millions .................... ................ 20 .6 32 .1 125 .9 194 .2 282 .1 

Capital Conversion Costs ... 2012$ Millions .................... ................ 3 .5 3 .6 58 .1 160 .7 499 .7 

Total Conversion Costs ...... 2012$ Millions .................... ................ 24 .1 35 .6 184 .0 354 .9 781 .8 

* Values in parentheses are negative values. 

At TSL 1, DOE estimates impacts on 

INPV for commercial refrigeration 

equipment manufacturers to range from 

¥$23.9 million to ¥$9.9 million, or a 

change in INPV of ¥0 percent to ¥0.37 

percent. At this potential standard level, 

industry free cash flow is estimated to 

decrease by approximately 4.16 percent 

to $192.1 million, compared to the basecase value of $200.4 million in the year 

before the compliance date (2016). 

The INPV impacts at TSL 1 are 

relatively minor because DOE 

manufacturer production costs do not 

increase significant. The average unit 

price for the industry (calculated by 

dividing industry revenue by industry 

unit shipments) increases 0.8% from 

$2,892.72 to $2,916.55 in the standards 

year. Few capital conversion costs are 

expected because DOE anticipates that 

manufacturers would be able to make 

simple component swaps to meet the 

efficiency levels for each equipment 

class at this TSL. However, product 

conversion costs are required for 

industry certifications to incorporate the 

new components into existing designs. 

Industry conversion costs total $24.1 

million. 

Under the preservation of gross 

margin percentage markup scenario, 

impacts on manufacturers are 

marginally negative because while 

manufacturers can maintain their gross 

margin percentages, they also incur 

conversion costs that offset the higher 

profits that they gain from increasing 

their selling prices to accommodate 

higher production costs. However, the 

effects of these conversion costs are 

more apparent in the preservation of 

operating profit markup scenario 

because manufacturers earn the same 

operating profit at TSL 1 as they do in 

the base case. In general, manufacturers 

stated that the preservation of operating 

profit scenario is a more likely 

representation of the industry than the 

preservation of operating profit 

scenario, especially as MPCs increase. 

At TSL 2, DOE estimates impacts on 

INPV for commercial refrigeration 

equipment manufacturers to range from 

¥$42.9 million to ¥$8.7 million, or a 

change in INPV of ¥1.61 percent to 

¥0.33 percent. At this potential 

standard level, industry free cash flow 

is estimated to decrease by 

approximately 6.04 percent to $188.3 

million, compared to the base-case 

value of $200.4 million in the year 

before the compliance date (2016). 

Although DOE continues to expect 

mild INPV impacts on the industry at 

TSL 2, product conversion costs do 

increase. Nearly 20% of product in the 

industry would require some level of 

component redesign, such as changes in 

evaporator coil, condenser coil, or 

compressor selection, that would 

necessitate UL or NSF certification 

changes. These industry certification 

investments push total industry 

conversion costs to $35.4 million. 

At TSL 3, DOE estimates impacts on 

INPV for commercial refrigeration 

equipment manufacturers to range from 

¥$165.0 million to ¥$93.9 million, or 

a change in INPV of ¥6.20 percent to 

¥3.53 percent. At this potential 

standard level, industry free cash flow 

is estimated to decrease by 

approximately 33.64 percent to $133.0 

million, compared to the base-case 

value of $200.4 million in the year 

before the compliance date (2016). 

At TSL 3, the expected design options 

do not dramatically alter manufacturer 

per unit production costs. Average unit 

costs increase by 4.1% to $3,011.93 

while industry shipments remain 

steady. However, DOE expects higher 

conversion costs at TSL 3 due to the 

possible need for improved insulation 

for high-volume products, such as 

VCS.SC.L, which accounts for 

approximately 18.3 percent of total 

shipments, and VCT.RC.L, which 

accounts for approximately 4.1 percent. 

In total, DOE expects 5 of the 24 

equipment classes to require improved 

insulation due to higher standards. The 

need for improved insulation 

necessitates redesign efforts for the 

cabinet as well as interior components. 

Furthermore, thicker insulation requires 

investment in new production tooling. 


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Total industry conversion costs reach 

$184.0 million. 

At TSL 4, DOE estimates impacts on 

INPV for commercial refrigeration 

equipment manufacturers range from 

¥$320.9 million to ¥$189.4 million, or 

a change in INPV of ¥12.7 percent to 

¥7.12 percent. At this potential 

standard level, industry free cash flow 

is estimated to decrease by 

approximately 67.84 percent to $64.4 

million, compared to the base-case 

value of $200.4 million in the year 

before the compliance date (2016). 

The drop in INPV at TSL 4 is driven 

by conversion costs. Industry average 

unit price increases 7.6% and industry 

shipments are modeled to remain 

steady. However, the need for new 

tooling to accommodate additional foam 

insulation in 16 of the 25 analyzed 

equipment classes pushes up industry 

conversion costs. The redesign effort, 

coupled with industry certification 

costs, push product conversion costs up 

to $194.2 million. Total industry 

conversion costs are expected to reach 

$354.9 million. 

At TSL 5, DOE estimates impacts on 

INPV for commercial refrigeration 

equipment manufacturers to range from 

¥$1,144.85 million to ¥$184.4 million, 

or a change in INPV of ¥43.04 percent 

to ¥6.93 percent. At this potential 

standard level, industry free cash flow 

is estimated to decrease by 

approximately 158.32 percent to 

¥$116.9 million, compared to the basecase value of $200.4 million in the year 

before the compliance date (2016). 

A substantial increase in conversion 

costs are expected at TSL 5 due to the 

possible need for VIP technology. VIPs 

are not currently used by any 

commercial refrigeration equipment 

manufacturers and the production of 

VIPs would require processes different 

from those used to produce standard 

foam panels. High R&D investments 

would be necessary to integrate the 

technology into CRE cases. Based on 

industry feedback, DOE estimated the 

R&D investment to be 1–2 times the 

industry’s typical annual R&D 

expenditure and the capital conversion 

cost to be more than double the cost of 

all current fixtures in use. Total 

industry conversion costs total $781.8 

million. 

b. Impacts on Direct Employment 

To quantitatively assess the impacts 

of amended energy conservation 

standards on employment, DOE used 

the GRIM to estimate the domestic labor 

expenditures and number of employees 

in the base case and at each TSL from 

2013 through 2046. DOE used statistical 

data from the U.S. Census Bureau’s 2011 

Annual Survey of Manufacturers (ASM), 

the results of the engineering analysis, 

the commercial refrigeration equipment 

shipments forecast, and interviews with 

manufacturers to determine the inputs 

necessary to calculate industry-wide 

labor expenditures and domestic 

employment levels. Labor expenditures 

related to manufacturing of the product 

are a function of the labor intensity of 

the product, the sales volume, and an 

assumption that wages remain fixed in 

real terms over time. The total labor 

expenditures in each year are calculated 

by multiplying the MPCs by the labor 

percentage of MPCs. 

The total labor expenditures in the 

GRIM were then converted to domestic 

production employment levels by 

dividing production labor expenditures 

by the annual payment per production 

worker (production worker hours times 

the labor rate found in the U.S. Census 

Bureau’s 2011 ASM). The estimates of 

production workers in this section cover 

workers, including line supervisors who 

are directly involved in fabricating and 

assembling a product within the OEM 

facility. Workers performing services 

that are closely associated with 

production operations, such as materials 

handling tasks using forklifts, are also 

included as production labor. DOE’s 

estimates only account for production 

workers who manufacture the specific 

products covered by this rulemaking. 

TABLE V.37—POTENTIAL CHANGES IN THE NUMBER OF COMMERCIAL REFRIGERATION EQUIPMENT PRODUCTION WORKERS

IN 2017 

Trial Standard Level * 

Base Case 1 2 3 4 5 

Total Number of Domestic Production Workers in 2017 (assuming no changes in production locations).7,779 7,779 ................ 7,779 ................ 7,779 ................ 7,780 ................ 8,220 

Range of Potential Changes in 

Domestic Production Workers 

in 2017 **.

— (7,7790) to 0 .... (7,740) to 0 ...... (7,779) to 0 ...... (7,779) to 1 ...... (7,779) to 441. 

* Numbers in parentheses are negative numbers. 

** DOE presents a range of potential employment impacts, where the lower range represents the scenario in which all domestic manufacturers 

move production to other countries. 

The employment impacts shown in 

Table V.37 represent the potential 

production employment changes that 

could result following the compliance 

date of an amended energy conservation 

standard. The upper end of the results 

in the table estimates the maximum 

increase in the number of production 

workers after the implementation of 

new energy conservation standards and 

it assumes that manufacturers would 

continue to produce the same scope of 

covered products within the United 

States. The lower end of the range 

indicates the total number of U.S. 

production workers in the industry who 

could lose their jobs if all existing 

production were moved outside of the 

United States. Though manufacturers 

stated in interviews that shifts in 

production to foreign countries are 

unlikely, the industry did not provide 

enough information for DOE fully 

quantify what percentage of the industry 

would move production at each 

evaluated standard level. 

The majority of design options 

analyzed in the engineering analysis 

require manufacturers to purchase 

more-efficient components from 

suppliers. These components do not 

require significant additional labor to 

assemble. A key component of a 

commercial refrigeration equipment 

unit that requires fabrication labor by 

the commercial refrigeration equipment 

manufacturer is the shell of the unit, 

which needs to be formed and foamed 

in. Although this activity may require 

new production equipment if thicker 

insulation is needed to meet higher 

efficiency levels, the process of building 

the foamed-in-place cases would 

essentially remain the same, and 

therefore require no additional labor 


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costs. As a result, labor needs are not 

expected to increase as the amended 

energy conservation standard increases 

from baseline to TSL 4. 

At TSL 5, the introduction of vacuum 

insulation panels may lead to greater 

labor requirements. In general, the 

production and handling of VIPs will 

require more labor than the production 

of standard refrigerated cases. This is 

due to the delicate nature of VIPs and 

the additional labor necessary to embed 

them into a display case. The additional 

labor and handling associated with 

these panels account for the increase in 

labor at the max-tech trial standard 

level. 

DOE notes that the employment 

impacts discussed here are independent 

of the employment impacts to the 

broader U.S. economy, which are 

documented in the Employment Impact 

Analysis, chapter 16 of the TSD. 

c. Impacts on Manufacturing Capacity 

According to the majority of 

commercial refrigeration equipment 

manufacturers interviewed, amended 

energy conservation standards will not 

significantly affect manufacturers’ 

production capacities. An amended 

energy conservation standard for 

commercial refrigeration equipment 

would not change the fundamental 

assembly of the equipment, but 

manufacturers do anticipate potential 

for changes to tooling and fixtures. The 

most significant of these would come as 

a result of any redesigns performed to 

accommodate additional foam 

insulation thickness. However, most of 

the design options being evaluated are 

already available on the market as 

product options. Thus, DOE believes 

manufacturers would be able to 

maintain manufacturing capacity levels 

and continue to meet market demand 

under amended energy conservation 

standards. 

d. Impacts on Subgroups of 

Manufacturers 

Small manufacturers, niche 

equipment manufacturers, and 

manufacturers exhibiting a cost 

structure substantially different from the 

industry average could be affected 

disproportionately. As discussed in 

section IV.J, using average cost 

assumptions to develop an industry 

cash-flow estimate is inadequate to 

assess differential impacts among 

manufacturer subgroups. 

For commercial refrigeration 

equipment, DOE identified and 

evaluated the impact of amended energy 

conservation standards on one 

subgroup: Small manufacturers. The 

SBA defines a ‘‘small business’’ as 

having 750 employees or less for NAICS 

333415, ‘‘Air-Conditioning and Warm 

Air Heating Equipment and Commercial 

and Industrial Refrigeration Equipment 

Manufacturing.’’ Based on this 

definition, DOE identified 32 

manufacturers in the commercial 

refrigeration equipment industry that 

are small businesses. 

For a discussion of the impacts on the 

small manufacturer subgroup, see the 

regulatory flexibility analysis in section 

VI.B of this document and chapter 12 of 

the final rule TSD. 

e. Cumulative Regulatory Burden 

While any one regulation may not 

impose a significant burden on 

manufacturers, the combined effects of 

recent or impending regulations may 

have serious consequences for some 

manufacturers, groups of manufacturers, 

or an entire industry. Assessing the 

impact of a single regulation may 

overlook this cumulative regulatory 

burden. In addition to energy 

conservation standards, other 

regulations can significantly affect 

manufacturers’ financial operations. 

Multiple regulations affecting the same 

manufacturer can strain profits and lead 

companies to abandon product lines or 

markets with lower expected future 

returns than competing products. For 

these reasons, DOE conducts an analysis 

of cumulative regulatory burden as part 

of its rulemakings pertaining to 

appliance efficiency. 

For the cumulative regulatory burden 

analysis, DOE looks at other regulations 

that could affect CRE manufacturers that 

will take effect approximately three 

years before or after the 2017 

compliance date of amended energy 

conservation standards for these 

products. In interviews, manufacturers 

cited Federal regulations on 

certification, on walk-in cooler and 

freezer equipment, and from ENERGY 

STAR as contributing to their 

cumulative regulatory burden. The 

compliance years and expected industry 

conversion costs are listed below: 

Walk-In Cooler and Freezer Energy 

Conservation Standard Rulemaking 

Nine commercial refrigeration 

equipment manufacturers also produce 

walk-ins, and therefore they must 

comply with two rulemakings that 

follow similar timelines. These 

manufacturers will incur conversion 

costs for both types of products at 

around the same time, which could be 

a significant strain on resources. In the 

2013 NOPR for walk-ins, the proposed 

standard was estimated to require 

conversion costs of $71 million (in 

2012$) to be incurred by the industry 

ahead of the 2017 compliance date. 78 

FR 55781. However, the analysis is not 

final and these figures are subject to 

change in the forthcoming final rule for 

walk-in coolers and freezers. DOE 

discusses these and other requirements, 

and includes the full details of the 

cumulative regulatory burden, in 

chapter 12 of the final rule TSD. 

Certification, Compliance, and 

Enforcement Rule 

Many manufacturers have expressed 

concerns about the Certification, 

Compliance, and Enforcement (CC&E) 

March 2011 final rule, which allows 

DOE to enforce the energy and water 

conservation standards for covered 

products and equipment, and provides 

for more accurate, comprehensive 

information about the energy and water 

use characteristics of products sold in 

the United States. The rule revises 

former certification regulations so that 

the Department has the information it 

needs to ensure that regulated products 

sold in the United States comply with 

the law. According to the rule, 

manufacturers of covered consumer 

products and commercial and industrial 

equipment must certify on an annual 

basis, by means of a compliance 

statement and a certification report, that 

each of their basic models meets its 

applicable energy conservation, water 

conservation, and/or design standard 

before it is distributed within the United 

States. For purposes of certification 

testing, the determination that a basic 

model complies with the applicable 

conservation standard must be based on 

sampling procedures, which currently 

require that a minimum of two units of 

a basic model must be tested in order to 

certify that the model is compliant 

(unless the product-specific regulations 

specify otherwise). 76 FR 12422 (March 

7, 2011). 

However, DOE recognizes that 

sampling requirements can create 

burden for certain commercial 

refrigeration equipment manufacturers 

who build one-of-a kind customized 

units and have a large number of basic 

models. Therefore, DOE conducted a 

rulemaking to expand AEDM coverage 

and issued a final rule on December 31, 

2013. (78 FR 79579) An AEDM is a 

computer modeling or mathematical 

tool that predicts the performance of 

non-tested basic models. In the final 

rule, DOE is allowing CRE 

manufacturers to rate their basic models 

using AEDMs, reducing the need for 

sample units and reducing burden on 

manufacturers. More information can be 

found at http://www1.eere.energy.gov/

buildings/appliance_standards/

implement_cert_and_enforce.html. DOE 


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discusses these and other requirements, 

and includes the full details of the 

cumulative regulatory burden, in 

chapter 12 of the final rule TSD. 

EPA’s ENERGY STAR 

Some stakeholders have also 

expressed concern regarding potential 

conflicts with other certification 

programs, in particular EPA’s ENERGY 

STAR requirements. However, DOE 

notes that certain standards, such as 

ENERGY STAR, are voluntary for 

manufacturers. As such, they are not 

part of DOE’s consideration of 

cumulative regulatory burden. 

DOE discusses these and other nonFederal regulations in chapter 12 of the 

NOPR TSD. 

3. National Impact Analysis 

a. Energy Savings 

DOE estimated the NES by calculating 

the difference in annual energy 

consumption for the base-case scenario 

and standards-case scenario at each TSL 

for each equipment class and summing 

up the annual energy savings over the 

lifetime of all equipment purchased in 

2017–2046. 

Table V.38 presents the primary NES 

(taking into account losses in the 

generation and transmission of 

electricity) for all equipment classes and 

the sum total of NES for each TSL, and 

Table V.39 presents estimated FFC 

energy savings for each considered TSL. 

The total FFC NES progressively 

increases from 1.195 quads at TSL 1 to 

4.207 quads at TSL 5. 

TABLE V.38—CUMULATIVE NATIONAL PRIMARY ENERGY SAVINGS FOR EQUIPMENT PURCHASED IN 2017–2046 

Equipment class 

Quads 

TSL 1 TSL 2 TSL 3 TSL 4 TSL 5 

VOP.RC.M ........................................................................... 0.000 0.000 0.403 0.550 0.584 

VOP.RC.L ............................................................................ 0.000 0.000 0.001 0.011 0.017 

VOP.SC.M ............................................................................ 0.000 0.000 0.000 0.002 0.007 

VCT.RC.M ............................................................................ 0.000 0.000 0.006 0.008 0.010 

VCT.RC.L ............................................................................. 0.096 0.096 0.130 0.150 0.259 

VCT.SC.M ............................................................................ 0.010 0.060 0.093 0.110 0.139 

VCT.SC.L ............................................................................. 0.018 0.041 0.045 0.050 0.050 

VCT.SC.I .............................................................................. 0.001 0.001 0.001 0.003 0.008 

VCS.SC.M ............................................................................ 0.309 0.687 0.794 0.870 1.080 

VCS.SC.L ............................................................................. 0.450 0.631 0.808 0.839 1.121 

VCS.SC.I .............................................................................. 0.000 0.001 0.002 0.002 0.005 

SVO.RC.M ........................................................................... 0.229 0.229 0.229 0.316 0.335 

SVO.SC.M ............................................................................ 0.000 0.000 0.000 0.010 0.016 

SOC.RC.M ........................................................................... 0.000 0.000 0.000 0.004 0.016 

SOC.SC.M ........................................................................... 0.000 0.000 0.000 0.001 0.002 

HZO.RC.M ........................................................................... 0.000 0.000 0.000 0.000 0.002 

HZO.RC.L ............................................................................ 0.000 0.000 0.000 0.000 0.023 

HZO.SC.M ............................................................................ 0.000 0.001 0.001 0.001 0.002 

HZO.SC.L ............................................................................. 0.000 0.000 0.000 0.000 0.000 

HCT.SC.M ............................................................................ 0.000 0.001 0.001 0.002 0.002 

HCT.SC.L ............................................................................. 0.011 0.012 0.012 0.013 0.016 

HCT.SC.I .............................................................................. 0.000 0.000 0.000 0.000 0.005 

HCS.SC.M ............................................................................ 0.004 0.008 0.013 0.013 0.030 

HCS.SC.L ............................................................................. 0.001 0.002 0.003 0.005 0.010 

PD.SC.M .............................................................................. 0.046 0.271 0.301 0.310 0.403 

Total .............................................................................. 1.176 2.041 2.844 3.270 4.140 

TABLE V.39—CUMULATIVE NATIONAL FULL-FUEL-CYCLE ENERGY SAVINGS FOR EQUIPMENT PURCHASED IN 2017–2046 

Equipment class 

Quads 

TSL 1 TSL 2 TSL 3 TSL 4 TSL 5 

VOP.RC.M ........................................................................... 0.000 0.000 0.410 0.559 0.593 

VOP.RC.L ............................................................................ 0.000 0.000 0.001 0.011 0.018 

VOP.SC.M ............................................................................ 0.000 0.000 0.000 0.002 0.007 

VCT.RC.M ............................................................................ 0.000 0.000 0.006 0.008 0.010 

VCT.RC.L ............................................................................. 0.098 0.098 0.132 0.153 0.263 

VCT.SC.M ............................................................................ 0.010 0.061 0.094 0.112 0.141 

VCT.SC.L ............................................................................. 0.018 0.042 0.046 0.050 0.050 

VCT.SC.I .............................................................................. 0.001 0.001 0.001 0.003 0.008 

VCS.SC.M ............................................................................ 0.314 0.699 0.807 0.884 1.097 

VCS.SC.L ............................................................................. 0.458 0.641 0.821 0.852 1.139 

VCS.SC.I .............................................................................. 0.000 0.001 0.002 0.002 0.005 

SVO.RC.M ........................................................................... 0.233 0.233 0.233 0.321 0.340 

SVO.SC.M ............................................................................ 0.000 0.000 0.000 0.010 0.016 

SOC.RC.M ........................................................................... 0.000 0.000 0.000 0.004 0.016 

SOC.SC.M ........................................................................... 0.000 0.000 0.000 0.001 0.002 

HZO.RC.M ........................................................................... 0.000 0.000 0.000 0.000 0.002 

HZO.RC.L ............................................................................ 0.000 0.000 0.000 0.000 0.023 

HZO.SC.M ............................................................................ 0.000 0.001 0.001 0.001 0.002 

HZO.SC.L ............................................................................. 0.000 0.000 0.000 0.000 0.000 

HCT.SC.M ............................................................................ 0.000 0.001 0.001 0.002 0.002 


tkelley on DSK3SPTVN1PROD with RULES2
Federal Register / Vol. 79, No. 60 / Friday, March 28, 2014 / Rules and Regulations 17799 

76EPCA requires DOE to review its standards at 

least once every 6 years (42 U.S.C. 6295(m)(1), 

6316(e)), and requires, for certain products, a 3-year 

period after any new standard is promulgated 

before compliance is required, except that in no 

case may any new standards be required within 6 

years of the compliance date of the previous 

standards. (42 U.S.C. 6295(m)(4), 6316(e)).While 

adding a 6-year review to the 3-year compliance 

period sums to 9 years, DOE notes that it may 

undertake reviews at any time within the 6-year 

period, and that the 3 year compliance date may be 

extended to 5 years. A 9-year analysis period may 

not be appropriate given the variability that occurs 

in the timing of standards reviews and the fact that, 

for some consumer products, the period following 

establishment of a new or amended standard before 

which compliance is required is 5 years rather than 

3 years. 

TABLE V.39—CUMULATIVE NATIONAL FULL-FUEL-CYCLE ENERGY SAVINGS FOR EQUIPMENT PURCHASED IN 2017–2046— 

Continued 

Equipment class 

Quads 

TSL 1 TSL 2 TSL 3 TSL 4 TSL 5 

HCT.SC.L ............................................................................. 0.011 0.012 0.012 0.013 0.016 

HCT.SC.I .............................................................................. 0.000 0.000 0.000 0.000 0.005 

HCS.SC.M ............................................................................ 0.004 0.008 0.013 0.014 0.030 

HCS.SC.L ............................................................................. 0.001 0.002 0.003 0.005 0.010 

PD.SC.M .............................................................................. 0.047 0.275 0.306 0.315 0.410 

Total .............................................................................. 1.195 2.074 2.889 3.323 4.207 

Circular A–4 requires agencies to 

present analytical results, including 

separate schedules of the monetized 

benefits and costs that show the type 

and timing of benefits and costs. 

Circular A–4 also directs agencies to 

consider the variability of key elements 

underlying the estimates of benefits and 

costs. For this rulemaking, DOE 

undertook a sensitivity analysis using 

nine rather than 30 years of product 

shipments. The choice of a 9-year 

period is a proxy for the timeline in 

EPCA for the review of certain energy 

conservation standards and potential 

revision of and compliance with such 

revised standards.76 The review 

timeframe established in EPCA 

generally does not overlap with the 

product lifetime, product manufacturing 

cycles or other factors specific to 

commercial refrigeration equipment. 

Thus, this information is presented for 

informational purposes only and is not 

indicative of any change in DOE’s 

analytical methodology. The primary 

and full-fuel cycle NES results based on 

a 9-year analysis period are presented in 

Table V.40 and Table V.41, respectively. 

The impacts are counted over the 

lifetime of products purchased in 2017– 

2025. 

TABLE V.40—CUMULATIVE NATIONAL PRIMARY ENERGY SAVINGS FOR 9-YEAR ANALYSIS PERIOD

[Equipment purchased in 2017–2025] 

Equipment class 

Quads 

TSL 1 TSL 2 TSL 3 TSL 4 TSL 5 

VOP.RC.M ........................................................................... 0.000 0.000 0.099 0.134 0.143 

VOP.RC.L ............................................................................ 0.000 0.000 0.000 0.003 0.004 

VOP.SC.M ............................................................................ 0.000 0.000 0.000 0.000 0.002 

VCT.RC.M ............................................................................ 0.000 0.000 0.002 0.002 0.003 

VCT.RC.L ............................................................................. 0.024 0.024 0.032 0.037 0.063 

VCT.SC.M ............................................................................ 0.003 0.017 0.025 0.029 0.036 

VCT.SC.L ............................................................................. 0.005 0.011 0.012 0.013 0.013 

VCT.SC.I .............................................................................. 0.000 0.000 0.000 0.001 0.002 

VCS.SC.M ............................................................................ 0.075 0.168 0.198 0.219 0.270 

VCS.SC.L ............................................................................. 0.110 0.156 0.202 0.209 0.278 

VCS.SC.I .............................................................................. 0.000 0.000 0.001 0.001 0.001 

SVO.RC.M ........................................................................... 0.056 0.056 0.056 0.077 0.082 

SVO.SC.M ............................................................................ 0.000 0.000 0.000 0.002 0.004 

SOC.RC.M ........................................................................... 0.000 0.000 0.000 0.001 0.004 

SOC.SC.M ........................................................................... 0.000 0.000 0.000 0.000 0.001 

HZO.RC.M ........................................................................... 0.000 0.000 0.000 0.000 0.000 

HZO.RC.L ............................................................................ 0.000 0.000 0.000 0.000 0.006 

HZO.SC.M ............................................................................ 0.000 0.000 0.000 0.000 0.000 

HZO.SC.L ............................................................................. 0.000 0.000 0.000 0.000 0.000 

HCT.SC.M ............................................................................ 0.000 0.000 0.000 0.000 0.001 

HCT.SC.L ............................................................................. 0.003 0.003 0.003 0.003 0.004 

HCT.SC.I .............................................................................. 0.000 0.000 0.000 0.000 0.001 

HCS.SC.M ............................................................................ 0.001 0.002 0.003 0.004 0.008 

HCS.SC.L ............................................................................. 0.000 0.001 0.001 0.001 0.003 

PD.SC.M .............................................................................. 0.011 0.066 0.074 0.076 0.099 

Total .............................................................................. 0.289 0.504 0.707 0.814 1.027 


tkelley on DSK3SPTVN1PROD with RULES2
17800 Federal Register / Vol. 79, No. 60 / Friday, March 28, 2014 / Rules and Regulations 

TABLE V.41—CUMULATIVE FULL FUEL CYCLE NATIONAL ENERGY SAVINGS FOR 9-YEAR ANALYSIS PERIOD

[Equipment purchased in 2017–2025] 

Equipment class 

quads 

TSL 1 TSL 2 TSL 3 TSL 4 TSL 5 

VOP.RC.M ........................................................................... 0.000 0.000 0.100 0.137 0.145 

VOP.RC.L ............................................................................ 0.000 0.000 0.000 0.003 0.004 

VOP.SC.M ............................................................................ 0.000 0.000 0.000 0.000 0.002 

VCT.RC.M ............................................................................ 0.000 0.000 0.002 0.002 0.003 

VCT.RC.L ............................................................................. 0.024 0.024 0.032 0.037 0.064 

VCT.SC.M ............................................................................ 0.003 0.017 0.025 0.029 0.037 

VCT.SC.L ............................................................................. 0.005 0.012 0.013 0.014 0.014 

VCT.SC.I .............................................................................. 0.000 0.000 0.000 0.001 0.002 

VCS.SC.M ............................................................................ 0.077 0.171 0.201 0.222 0.275 

VCS.SC.L ............................................................................. 0.112 0.158 0.205 0.213 0.283 

VCS.SC.I .............................................................................. 0.000 0.000 0.001 0.001 0.001 

SVO.RC.M ........................................................................... 0.057 0.057 0.057 0.079 0.083 

SVO.SC.M ............................................................................ 0.000 0.000 0.000 0.002 0.004 

SOC.RC.M ........................................................................... 0.000 0.000 0.000 0.001 0.004 

SOC.SC.M ........................................................................... 0.000 0.000 0.000 0.000 0.001 

HZO.RC.M ........................................................................... 0.000 0.000 0.000 0.000 0.000 

HZO.RC.L ............................................................................ 0.000 0.000 0.000 0.000 0.006 

HZO.SC.M ............................................................................ 0.000 0.000 0.000 0.000 0.000 

HZO.SC.L ............................................................................. 0.000 0.000 0.000 0.000 0.000 

HCT.SC.M ............................................................................ 0.000 0.000 0.000 0.000 0.001 

HCT.SC.L ............................................................................. 0.003 0.003 0.003 0.003 0.004 

HCT.SC.I .............................................................................. 0.000 0.000 0.000 0.000 0.001 

HCS.SC.M ............................................................................ 0.001 0.002 0.004 0.004 0.008 

HCS.SC.L ............................................................................. 0.000 0.001 0.001 0.001 0.003 

PD.SC.M .............................................................................. 0.011 0.067 0.075 0.077 0.100 

Total .............................................................................. 0.294 0.513 0.719 0.828 1.045 

b. Net Present Value of Customer Costs 

and Benefits 

DOE estimated the cumulative NPV to 

the Nation of the net savings for CRE 

customers that would result from 

potential standards at each TSL. In 

accordance with OMB guidelines on 

regulatory analysis (OMB Circular A–4, 

section E, September 17, 2003), DOE 

calculated NPV using both a 7-percent 

and a 3-percent real discount rate. 

Table V.42 and Table V.43 show the 

customer NPV results for each of the 

TSLs DOE considered for commercial 

refrigeration equipment at 7-percent and 

3-percent discount rates, respectively. 

The impacts cover the expected lifetime 

of equipment purchased in 2017–2046. 

The NPV results at a 7-percent 

discount rate are negative for all 

equipment classes at TSL 5 except for 

the VCT.SC.L equipment class. 

Efficiency levels for TSL 4 were chosen 

to correspond to the highest efficiency 

level with a near positive NPV at a 7- 

percent discount rate for each 

equipment class. The criterion for TSL 

3 was to select efficiency levels with the 

highest NPV at a 7-percent discount 

rate. Consequently, the total NPV is 

highest for TSL 3. TSL 2 shows the 

second highest total NPV at a 7-percent 

discount rate. TSL 1 has a total NPV 

lower than TSL 2. 

TABLE V.42— NET PRESENT VALUE OF CUSTOMER COSTS AND BENEFITS AT A 7-PERCENT DISCOUNT RATE

Equipment class 

billion 2012$ * 

TSL 1 TSL 2 TSL 3 TSL 4 TSL 5 

VOP.RC.M ........................................................................... 0.000 0.000 0.570 0.171 ¥2.941 

VOP.RC.L ............................................................................ 0.000 0.000 0.001 ¥0.004 ¥0.240 

VOP.SC.M ............................................................................ 0.000 0.000 0.000 ¥0.009 ¥0.374 

VCT.RC.M ............................................................................ 0.000 0.000 0.013 ¥0.003 ¥0.271 

VCT.RC.L ............................................................................. 0.212 0.212 0.234 ¥0.005 ¥4.423 

VCT.SC.M ............................................................................ ¥0.006 0.039 0.058 ¥0.003 ¥1.531 

VCT.SC.L ............................................................................. 0.059 0.118 0.123 0.040 0.040 

VCT.SC.I .............................................................................. 0.000 0.000 0.000 ¥0.004 ¥0.141 

VCS.SC.M ............................................................................ 0.756 1.748 1.829 1.659 ¥6.820 

VCS.SC.L ............................................................................. 1.164 1.502 1.579 1.550 ¥4.692 

VCS.SC.I .............................................................................. 0.001 0.002 0.003 0.003 ¥0.050 

SVO.RC.M ........................................................................... 0.291 0.291 0.291 0.081 ¥1.493 

SVO.SC.M ............................................................................ 0.000 0.000 0.000 ¥0.003 ¥0.215 

SOC.RC.M ........................................................................... 0.000 0.000 0.000 ¥0.011 ¥0.342 

SOC.SC.M ........................................................................... 0.000 0.000 0.000 ¥0.003 ¥0.032 

HZO.RC.M ........................................................................... 0.000 0.000 0.000 0.000 ¥0.123 

HZO.RC.L ............................................................................ 0.000 0.000 0.000 0.000 ¥0.734 

HZO.SC.M ............................................................................ 0.000 0.000 0.000 0.000 ¥0.025 

HZO.SC.L ............................................................................. 0.000 0.000 0.000 0.000 0.000 


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TABLE V.42— NET PRESENT VALUE OF CUSTOMER COSTS AND BENEFITS AT A 7-PERCENT DISCOUNT RATE—Continued 

Equipment class 

billion 2012$ * 

TSL 1 TSL 2 TSL 3 TSL 4 TSL 5 

HCT.SC.M ............................................................................ 0.001 0.002 0.002 0.000 ¥0.014 

HCT.SC.L ............................................................................. 0.024 0.024 0.025 0.022 ¥0.030 

HCT.SC.I .............................................................................. 0.000 0.000 0.000 0.000 ¥0.076 

HCS.SC.M ............................................................................ 0.008 0.012 0.012 0.007 ¥0.342 

HCS.SC.L ............................................................................. 0.003 0.005 0.006 0.004 ¥0.047 

PD.SC.M .............................................................................. 0.007 0.183 0.183 0.146 ¥3.475 

Total .............................................................................. 2.519 4.139 4.928 3.637 ¥28.390 

* A value of $0.000 means NES values are less than 0.001 billion 2012$. 

TABLE V.43— NET PRESENT VALUE OF CUSTOMER COSTS AND BENEFITS AT A 3-PERCENT DISCOUNT RATE

Equipment class 

billion 2012$ * 

TSL 1 TSL 2 TSL 3 TSL 4 TSL 5 

VOP.RC.M ........................................................................... 0.000 0.000 1.500 0.882 ¥4.894 

VOP.RC.L ............................................................................ 0.000 0.000 0.004 0.003 ¥0.433 

VOP.SC.M ............................................................................ 0.000 0.000 0.000 ¥0.016 ¥0.683 

VCT.RC.M ............................................................................ 0.000 0.000 0.029 0.001 ¥0.496 

VCT.RC.L ............................................................................. 0.481 0.481 0.551 0.125 ¥8.007 

VCT.SC.M ............................................................................ ¥0.006 0.119 0.185 0.086 ¥2.712 

VCT.SC.L ............................................................................. 0.124 0.252 0.265 0.116 0.116 

VCT.SC.I .............................................................................. 0.001 0.001 0.001 ¥0.005 ¥0.254 

VCS.SC.M ............................................................................ 1.656 3.838 4.074 3.825 ¥11.832 

VCS.SC.L ............................................................................. 2.551 3.333 3.626 3.592 ¥7.824 

VCS.SC.I .............................................................................. 0.001 0.005 0.007 0.007 ¥0.090 

SVO.RC.M ........................................................................... 0.790 0.790 0.790 0.476 ¥2.443 

SVO.SC.M ............................................................................ 0.000 0.000 0.000 0.003 ¥0.383 

SOC.RC.M ........................................................................... 0.000 0.000 0.000 ¥0.018 ¥0.625 

SOC.SC.M ........................................................................... 0.000 0.000 0.000 ¥0.004 ¥0.058 

HZO.RC.M ........................................................................... 0.000 0.000 0.000 0.000 ¥0.227 

HZO.RC.L ............................................................................ 0.000 0.000 0.000 0.000 ¥1.350 

HZO.SC.M ............................................................................ 0.000 0.001 0.001 0.000 ¥0.044 

HZO.SC.L ............................................................................. 0.000 0.000 0.000 0.000 0.000 

HCT.SC.M ............................................................................ 0.002 0.004 0.004 0.002 ¥0.024 

HCT.SC.L ............................................................................. 0.054 0.056 0.057 0.053 ¥0.039 

HCT.SC.I .............................................................................. 0.000 0.000 0.000 0.000 ¥0.137 

HCS.SC.M ............................................................................ 0.019 0.029 0.033 0.022 ¥0.594 

HCS.SC.L ............................................................................. 0.006 0.010 0.014 0.012 ¥0.076 

PD.SC.M .............................................................................. 0.046 0.577 0.602 0.537 ¥6.090 

Total .............................................................................. 5.727 9.497 11.742 9.698 ¥49.199 

* value of $0.000 means NES values are less than 0.001 billion 2012$. Values in parentheses are negative values. 

The NPV results based on the 

aforementioned 9-year analysis period 

are presented in Table V.44 and Table 

V.45. The impacts are counted over the 

lifetime of equipment purchased in 

2017–2025. As mentioned previously, 

this information is presented for 

informational purposes only and is not 

indicative of any change in DOE’s 

analytical methodology or decision 

criteria. 

TABLE V.44—NET PRESENT VALUE OF CUSTOMER COSTS AND BENEFITS AT A 7-PERCENT DISCOUNT RATE FOR 9-YEAR

ANALYSIS PERIOD

[Equipment purchased in 2017–2025] 

Equipment class 

billion 2012$* 

TSL 1 TSL 2 TSL 3 TSL 4 TSL 5 

VOP.RC.M ........................................................................... 0.000 0.000 0.237 0.036 ¥1.454 

VOP.RC.L ............................................................................ 0.000 0.000 0.000 ¥0.002 ¥0.116 

VOP.SC.M ............................................................................ 0.000 0.000 0.000 ¥0.005 ¥0.179 

VCT.RC.M ............................................................................ 0.000 0.000 0.006 ¥0.002 ¥0.130 

VCT.RC.L ............................................................................. 0.099 0.099 0.107 ¥0.009 ¥2.130 

VCT.SC.M ............................................................................ ¥0.004 0.020 0.027 ¥0.003 ¥0.736 

VCT.SC.L ............................................................................. 0.029 0.059 0.061 0.021 0.021 

VCT.SC.I .............................................................................. 0.000 0.000 0.000 ¥0.002 ¥0.068 


tkelley on DSK3SPTVN1PROD with RULES2
17802 Federal Register / Vol. 79, No. 60 / Friday, March 28, 2014 / Rules and Regulations 

TABLE V.44—NET PRESENT VALUE OF CUSTOMER COSTS AND BENEFITS AT A 7-PERCENT DISCOUNT RATE FOR 9-YEAR

ANALYSIS PERIOD—Continued 

[Equipment purchased in 2017–2025] 

Equipment class 

billion 2012$* 

TSL 1 TSL 2 TSL 3 TSL 4 TSL 5 

VCS.SC.M ............................................................................ 0.342 0.792 0.827 0.732 ¥3.338 

VCS.SC.L ............................................................................. 0.528 0.681 0.709 0.693 ¥2.311 

VCS.SC.I .............................................................................. 0.000 0.001 0.001 0.001 ¥0.024 

SVO.RC.M ........................................................................... 0.118 0.118 0.118 0.012 ¥0.742 

SVO.SC.M ............................................................................ 0.000 0.000 0.000 ¥0.002 ¥0.104 

SOC.RC.M ........................................................................... 0.000 0.000 0.000 ¥0.006 ¥0.165 

SOC.SC.M ........................................................................... 0.000 0.000 0.000 ¥0.001 ¥0.015 

HZO.RC.M ........................................................................... 0.000 0.000 0.000 0.000 ¥0.059 

HZO.RC.L ............................................................................ 0.000 0.000 0.000 0.000 ¥0.353 

HZO.SC.M ............................................................................ 0.000 0.000 0.000 0.000 ¥0.012 

HZO.SC.L ............................................................................. 0.000 0.000 0.000 0.000 0.000 

HCT.SC.M ............................................................................ 0.000 0.001 0.001 0.000 ¥0.007 

HCT.SC.L ............................................................................. 0.011 0.011 0.011 0.010 ¥0.018 

HCT.SC.I .............................................................................. 0.000 0.000 0.000 0.000 ¥0.037 

HCS.SC.M ............................................................................ 0.004 0.006 0.006 0.003 ¥0.182 

HCS.SC.L ............................................................................. 0.001 0.002 0.003 0.002 ¥0.025 

PD.SC.M .............................................................................. 0.000 0.079 0.077 0.059 ¥1.680 

Total .............................................................................. 1.129 1.869 2.191 1.536 ¥13.863 

* A value of $0.000 means NES values are less than 0.001 billion 2012$. Values in parentheses are negative values. 

TABLE V.45—NET PRESENT VALUE OF CUSTOMER COSTS AND BENEFITS AT A 3-PERCENT DISCOUNT RATE FOR 9-YEAR

ANALYSIS PERIOD

[Equipment purchased in 2017–2025] 

Equipment class 

billion 2012$* 

TSL 1 TSL 2 TSL 3 TSL 4 TSL 5 

VOP.RC.M ........................................................................... 0.000 0.000 0.446 0.208 ¥1.814 

VOP.RC.L ............................................................................ 0.000 0.000 0.001 ¥0.001 ¥0.154 

VOP.SC.M ............................................................................ 0.000 0.000 0.000 ¥0.006 ¥0.240 

VCT.RC.M ............................................................................ 0.000 0.000 0.010 0.000 ¥0.174 

VCT.RC.L ............................................................................. 0.160 0.160 0.179 0.027 ¥2.829 

VCT.SC.M ............................................................................ ¥0.004 0.044 0.062 0.025 ¥0.957 

VCT.SC.L ............................................................................. 0.045 0.092 0.096 0.043 0.043 

VCT.SC.I .............................................................................. 0.000 0.000 0.000 ¥0.002 ¥0.090 

VCS.SC.M ............................................................................ 0.533 1.239 1.314 1.204 ¥4.295 

VCS.SC.L ............................................................................. 0.824 1.078 1.160 1.143 ¥2.885 

VCS.SC.I .............................................................................. 0.000 0.001 0.002 0.002 ¥0.032 

SVO.RC.M ........................................................................... 0.231 0.231 0.231 0.108 ¥0.914 

SVO.SC.M ............................................................................ 0.000 0.000 0.000 0.000 ¥0.136 

SOC.RC.M ........................................................................... 0.000 0.000 0.000 ¥0.007 ¥0.221 

SOC.SC.M ........................................................................... 0.000 0.000 0.000 ¥0.002 ¥0.021 

HZO.RC.M ........................................................................... 0.000 0.000 0.000 0.000 ¥0.080 

HZO.RC.L ............................................................................ 0.000 0.000 0.000 0.000 ¥0.475 

HZO.SC.M ............................................................................ 0.000 0.000 0.000 0.000 ¥0.016 

HZO.SC.L ............................................................................. 0.000 0.000 0.000 0.000 0.000 

HCT.SC.M ............................................................................ 0.001 0.001 0.001 0.000 ¥0.009 

HCT.SC.L ............................................................................. 0.017 0.018 0.018 0.016 ¥0.020 

HCT.SC.I .............................................................................. 0.000 0.000 0.000 0.000 ¥0.049 

HCS.SC.M ............................................................................ 0.007 0.010 0.011 0.007 ¥0.237 

HCS.SC.L ............................................................................. 0.002 0.004 0.005 0.004 ¥0.031 

PD.SC.M .............................................................................. 0.009 0.178 0.182 0.158 ¥2.171 

Total .............................................................................. 1.826 3.056 3.719 2.929 ¥17.805 

* A value of $0.000 means NES values are less than 0.001 billion 2012$. Values in parentheses are negative values. 

c. Employment Impacts 

In addition to the direct impacts on 

manufacturing employment discussed 

in section V.B.2, DOE develops general 

estimates of the indirect employment 

impacts of amended standards on the 

economy. As discussed above, DOE 

expects energy amended conservation 

standards for commercial refrigeration 

equipment to reduce energy bills for 

commercial customers, and the resulting 

net savings to be redirected to other 

forms of economic activity. DOE also 

realizes that these shifts in spending 

and economic activity by commercial 


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refrigeration equipment owners could 

affect the demand for labor. Thus, 

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 

amended standards. These impacts may 

affect a variety of businesses not directly 

involved in the decision to make, 

operate, or pay the utility bills for 

commercial refrigeration equipment. To 

estimate these indirect economic effects, 

DOE used an input/output model of the 

U.S. economy using U.S. Department of 

Commerce, Bureau of Economic 

Analysis (BEA) and BLS data (as 

described in section IV.J of this 

document; see chapter 16 of the final 

rule TSD for more details). 

Customers who purchase moreefficient equipment pay lower amounts 

towards utility bills, which results in 

job losses in the electric utilities sector. 

However, in the input/output model, 

the dollars saved on utility bills are reinvested in economic sectors that create 

more jobs than are lost in the electric 

utilities sector. Thus, the amended 

energy conservation standards for 

commercial refrigeration equipment are 

likely to slightly increase the net 

demand for labor in the economy. As 

shown in chapter 16 of the final rule 

TSD, DOE estimates that net indirect 

employment impacts from commercial 

refrigeration equipment amended 

standards are very small relative to the 

national economy. However, the net 

increase in jobs might be offset by other, 

unanticipated effects on employment. 

Neither the BLS data nor the input/

output model used by DOE includes the 

quality of jobs. 

4. Impact on Utility or Performance of 

Equipment 

In performing the engineering 

analysis, DOE considers design options 

that would not lessen the utility or 

performance of the individual classes of 

equipment. (42 U.S.C. 

6295(o)(2)(B)(i)(IV) and 6316(e)(1)) As 

presented in the screening analysis 

(chapter 4 of the final rule TSD), DOE 

eliminates from consideration any 

design options that reduce the utility of 

the equipment. For today’s final rule, 

DOE concluded that none of the 

efficiency levels considered for 

commercial refrigeration equipment 

reduce the utility or performance of the 

equipment. 

5. Impact of Any Lessening of 

Competition 

EPCA directs DOE to consider any 

lessening of competition that is likely to 

result from standards. It also directs the 

Attorney General of the United States 

(Attorney General) to determine the 

impact, if any, of any lessening of 

competition likely to result from a 

proposed standard and to transmit such 

determination to the Secretary within 60 

days of the publication of a proposed 

rule and simultaneously published 

proposed rule, together with an analysis 

of the nature and extent of the impact. 

(42 U.S.C. 6295(o)(2)(B)(i)(V) and (B)(ii)) 

To assist the Attorney General in 

making a determination for CRE 

standards, DOE provided the 

Department of Justice (DOJ) with copies 

of the NOPR and the TSD for review. 

DOE received no adverse comments 

from DOJ regarding the proposal. 

6. Need of the Nation To Conserve 

Energy 

An improvement in the energy 

efficiency of the equipment subject to 

today’s final rule is likely to improve 

the security of the Nation’s energy 

system by reducing overall demand for 

energy. Reduced electricity demand 

may also improve the reliability of the 

electricity system. Reductions in 

national electric generating capacity 

estimated for each considered TSL are 

reported in chapter 14 of the final rule 

TSD. 

Energy savings from amended 

standards for commercial refrigeration 

equipment could also produce 

environmental benefits in the form of 

reduced emissions of air pollutants and 

GHGs associated with electricity 

production. Table V.46 provides DOE’s 

estimate of cumulative emissions 

reductions projected to result from the 

TSLs considered in this rule. The table 

includes both power sector emissions 

and upstream emissions. DOE reports 

annual emissions reductions for each 

TSL in chapter 13 of the final rule TSD. 

TABLE V.46—CUMULATIVE EMISSIONS REDUCTION ESTIMATED FOR COMMERCIAL REFRIGERATION EQUIPMENT TSLS FOR

EQUIPMENT PURCHASED IN 2017–2046 

TSL 

1 2 3 4 5 

Power Sector Emissions 

CO2 (million metric tons) ........................................... 54 .9 95 .4 133 .0 152 .9 193 .6 

SO2 (thousand tons) .................................................. 84 .9 147 .4 205 .5 236 .3 299 .1 

NOX (thousand tons) ................................................. ¥11 .4 ¥19 .9 ¥28 .1 ¥32 .3 ¥40 .7 

Hg (tons) .................................................................... 0 .10 0 .17 0 .24 0 .28 0 .35 

N2O (thousand tons) .................................................. 1 .3 2 .3 3 .2 3 .7 4 .7 

CH4 (thousand tons) .................................................. 7 .7 13 .3 18 .6 21 .4 27 .1 

Upstream Emissions 

CO2 (million metric tons) ........................................... 3 .7 6 .4 8 .9 10 .2 13 .0 

SO2 (thousand tons) .................................................. 0 .8 1 .4 1 .9 2 .2 2 .8 

NOX (thousand tons) ................................................. 50 .6 87 .8 122 .4 140 .7 178 .2 

Hg (tons) .................................................................... 0 .00 0 .00 0 .00 0 .01 0 .01 

N2O (thousand tons) .................................................. 0 .0 0 .1 0 .1 0 .1 0 .1 

CH4 (thousand tons) .................................................. 307 .2 533 .3 743 .1 854 .6 1081 .9 

Total Emissions 

CO2 (million metric tons) ........................................... 58 .6 101 .7 141 .9 163 .2 206 .5 

SO2 (thousand tons) .................................................. 85 .7 148 .8 207 .4 238 .5 301 .9 

NOX (thousand tons) ................................................. 39 .2 67 .9 94 .3 108 .4 137 .4 

Hg (tons) .................................................................... 0 .10 0 .18 0 .25 0 .28 0 .36 

N2O (thousand tons) .................................................. 1 .4 2 .4 3 .3 3 .8 4 .8 


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TABLE V.46—CUMULATIVE EMISSIONS REDUCTION ESTIMATED FOR COMMERCIAL REFRIGERATION EQUIPMENT TSLS FOR

EQUIPMENT PURCHASED IN 2017–2046—Continued 

TSL 

1 2 3 4 5 

CH4 (thousand tons) .................................................. 314 .9 546 .6 761 .7 875 .9 1109 .0 

As part of the analysis for this final 

rule, DOE estimated monetary benefits 

likely to result from the reduced 

emissions of CO2 and NOX that were 

estimated for each of the TSLs 

considered. As discussed in section 

IV.L, for CO2, DOE used values for the 

SCC developed by an interagency 

process. The interagency group selected 

four sets of SCC values for use in 

regulatory analyses. Three sets are based 

on the average SCC from three 

integrated assessment models, at 

discount rates of 2.5 percent, 3 percent, 

and 5 percent. The fourth set, which 

represents the 95th-percentile SCC 

estimate across all three models at a 3- 

percent discount rate, is included to 

represent higher-than-expected impacts 

from temperature change further out in 

the tails of the SCC distribution. The 

four SCC values for CO2 emissions 

reductions in 2015, expressed in 2012$, 

are $11.8/ton, $39.7/ton, $61.2/ton, and 

$117/ton. The values for later years are 

higher due to increasing emissionsrelated costs as the magnitude of 

projected climate change increases. 

Table V.47 presents the global value 

of CO2 emissions reductions at each 

TSL. DOE calculated domestic values as 

a range from 7 percent to 23 percent of 

the global values, and these results are 

presented in chapter 14 of the final rule 

TSD. 

TABLE V.47—GLOBAL PRESENT VALUE OF CO2 EMISSIONS REDUCTION FOR POTENTIAL STANDARDS FOR COMMERCIAL

REFRIGERATION EQUIPMENT

TSL 

SCC Scenario 

5% discount rate, 

average 

3% discount rate, 

average 

2.5% discount 

rate, average 

3% discount rate, 

95th percentile 

million 2012$ 

Power Sector Emissions 

1 ................................................................................................... 392 1762 2787 5438 

2 ................................................................................................... 682 3063 4844 9452 

3 ................................................................................................... 952 4274 6758 13187 

4 ................................................................................................... 1095 4916 7773 15167 

5 ................................................................................................... 1385 6220 9836 19192 

Upstream Emissions 

1 ................................................................................................... 25 115 183 356 

2 ................................................................................................... 43 200 317 617 

3 ................................................................................................... 61 278 442 861 

4 ................................................................................................... 70 320 508 990 

5 ................................................................................................... 88 405 643 1253 

Total Emissions 

1 ................................................................................................... 417 1877 2970 5794 

2 ................................................................................................... 725 3263 5161 10070 

3 ................................................................................................... 1012 4552 7200 14047 

4 ................................................................................................... 1164 5236 8281 16157 

5 ................................................................................................... 1473 6625 10479 20444 

DOE is well aware that scientific and 

economic knowledge about the 

contribution of CO2 and other GHG 

emissions to changes in the future 

global climate and the potential 

resulting damages to the world economy 

continues to evolve rapidly. Thus, any 

value placed in this final rule on 

reducing CO2 emissions is subject to 

change. DOE, together with other 

Federal agencies, will continue to 

review various methodologies for 

estimating the monetary value of 

reductions in CO2 and other GHG 

emissions. This ongoing review will 

consider the comments on this subject 

that are part of the public record for this 

final rule and other rulemakings, as well 

as other methodological assumptions 

and issues. However, consistent with 

DOE’s legal obligations, and taking into 

account the uncertainty involved with 

this particular issue, DOE has included 

in this final rule the most recent values 

and analyses resulting from the ongoing 

interagency review process. 

DOE also estimated a range for the 

cumulative monetary value of the 

economic benefits associated with NOX

emission reductions anticipated to 

result from amended commercial 

refrigeration equipment standards. 

Table V.48 presents the present value of 

cumulative NOX emissions reductions 

for each TSL calculated using the 

average dollar-per-ton values and 7- 

percent and 3-percent discount rates. 


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TABLE V.48—PRESENT VALUE OF

NOX EMISSIONS REDUCTION FOR

POTENTIAL STANDARDS FOR COMMERCIAL REFRIGERATION EQUIPMENT

TSL 

million 2012$ 

3% Discount 

rate 

7% Discount 

rate 

Power Sector Emissions 

1 ................ ¥25.3 ¥18.9 

2 ................ ¥44.4 ¥33.2 

3 ................ ¥62.4 ¥46.6 

4 ................ ¥71.9 ¥53.7 

5 ................ ¥90.6 ¥67.7 

Upstream Emissions 

1 ................ 68.7 32.6 

2 ................ 119.4 56.7 

TABLE V.48—PRESENT VALUE OF

NOX EMISSIONS REDUCTION FOR

POTENTIAL STANDARDS FOR COMMERCIAL REFRIGERATION EQUIPMENT—Continued 

TSL 

million 2012$ 

3% Discount 

rate 

7% Discount 

rate 

3 ................ 166.5 79.3 

4 ................ 191.5 91.2 

5 ................ 242.4 115.3 

Total Emissions 

1 ................ 43.4 13.7 

2 ................ 75.0 23.6 

3 ................ 104.1 32.6 

4 ................ 119.6 37.4 

5 ................ 151.8 47.6 

7. Summary of National Economic 

Impact 

The NPV of the monetized benefits 

associated with emission reductions can 

be viewed as a complement to the NPV 

of the customer savings calculated for 

each TSL considered in this final rule. 

Table V.49 presents the NPV values that 

result from adding the estimates of the 

potential economic benefits resulting 

from reduced CO2 and NOX emissions 

in each of four valuation scenarios to 

the NPV of customer savings calculated 

for each TSL, at both a 7-percent and a 

3-percent discount rate. The CO2 values 

used in the table correspond to the four 

scenarios for the valuation of CO2

emission reductions discussed above. 

TABLE V.49—COMMERCIAL REFRIGERATION EQUIPMENT TSLS: NET PRESENT VALUE OF CONSUMER SAVINGS COMBINED

WITH NET PRESENT VALUE OF MONETIZED BENEFITS FROM CO2 AND NOX EMISSIONS REDUCTIONS

Consumer NPV at 37% Discount Rate added with Value of Emissions Based 

on: 

TSL SCC Value of 

$11.8/metric ton 

CO2

* and Medium Value for 

NOX

SCC Value of 

$39.7/metric ton 

CO2

* and Medium Value for 

NOX

SCC Value of 

$61.2/metric ton 

CO2

* and Medium Value for 

NOX

SCC Value of 

$117/metric ton 

CO2

* and Medium Value for 

NOX

billion 2012$ 

1 ....................................................................................................... 6.2 7.6 8.7 11.6 

2 ....................................................................................................... 10.3 12.8 14.7 19.6 

3 ....................................................................................................... 12.9 16.4 19.0 25.9 

4 ....................................................................................................... 11.0 15.1 18.1 26.0 

5 ....................................................................................................... ¥47.6 ¥42.4 ¥38.6 ¥28.6 

Consumer NPV at 7% Discount Rate added with Value of Emissions Based 

on: 

TSL SCC Value of 

$11.8/metric ton 

CO2

* and Medium Value for 

NOX

SCC Value of 

$39.7/metric ton 

CO2

* and Medium Value for 

NOX

SCC Value of 

$61.2/metric ton 

CO2

* and Medium Value for 

NOX

SCC Value of 

$117/metric ton 

CO2

* and Medium Value for 

NOX

billion 2012$ 

1 ....................................................................................................... 3.0 4.4 5.5 8.3 

2 ....................................................................................................... 4.9 7.4 9.3 14.2 

3 ....................................................................................................... 6.0 9.5 12.2 19.0 

4 ....................................................................................................... 4.8 8.9 12.0 19.8 

5 ....................................................................................................... ¥26.9 ¥21.7 ¥17.9 ¥7.9 

* These label values represent the global SCC in 2015, in 2012$. The present values have been calculated with scenario-consistent discount 

rates. 

Although adding the value of 

customer savings to the values of 

emission reductions provides a valuable 

perspective, two issues should be 

considered. First, the national operating 

cost savings are domestic U.S. customer 

monetary savings that occur as a result 

of market transactions, while the value 

of CO2 reductions is based on a global 

value. Second, the assessments of 

operating cost savings and the SCC are 

performed with different methods that 

use quite different time frames for 

analysis. The national operating cost 

savings is measured for the lifetime of 

products shipped in 2017–2046. The 

SCC values, on the other hand, reflect 

the present value of future climaterelated impacts resulting from the 

emission of one metric ton of CO2 in 

each year. These impacts continue well 

beyond 2100. 

8. Other Factors 

EPCA allows the Secretary, in 

determining whether a standard is 

economically justified, to consider any 

other factors that the Secretary deems to 

be relevant. (42 U.S.C. 

6295(o)(2)(B)(i)(VII) and 6316(e)(1)) DOE 


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17806 Federal Register / Vol. 79, No. 60 / Friday, March 28, 2014 / Rules and Regulations 

has not considered other factors in 

development of the standards in this 

final rule. 

C. Conclusions 

Any new or amended energy 

conservation standard for any type (or 

class) of covered product shall be 

designed to achieve the maximum 

improvement in energy efficiency that 

the Secretary determines is 

technologically feasible and 

economically justified. (42 U.S.C. 

6295(o)(2)(A) and 6316(e)(1)) In 

determining whether a standard is 

economically justified, the Secretary 

must determine whether the benefits of 

the standard exceed its burdens to the 

greatest extent practicable, considering 

the seven statutory factors discussed 

previously. (42 U.S.C. 6295(o)(2)(B)(i) 

and 6316(e)(1)) The new or amended 

standard must also result in a significant 

conservation of energy. (42 U.S.C. 

6295(o)(3)(B) and 6316(e)(1)) 

For today’s rulemaking, DOE 

considered the impacts of potential 

standards at each TSL, beginning with 

the maximum technologically feasible 

level, to determine whether that level 

met the evaluation criteria. If the maxtech level was not justified, DOE then 

considered the next most efficient level 

and undertook the same evaluation until 

it reached the highest efficiency level 

that is both technologically feasible and 

economically justified and saves a 

significant amount of energy. 

To aid the reader in understanding 

the benefits and/or burdens of each TSL, 

tables in this section summarize the 

quantitative analytical results for each 

TSL, based on the assumptions and 

methodology discussed herein. The 

efficiency levels contained in each TSL 

are described in section IV.A.1. In 

addition to the quantitative results 

presented in the tables below, DOE also 

considers other burdens and benefits 

that affect economic justification. These 

include the impacts on identifiable 

subgroups of consumers who may be 

disproportionately affected by a national 

standard, and impacts on employment. 

Section IV.I presents the estimated 

impacts of each TSL for the considered 

subgroups. DOE discusses the impacts 

on employment in CRE manufacturing 

in section IV.J and discusses the indirect 

employment impacts in section IV.N. 

1. Benefits and Burdens of Trial 

Standard Levels Considered for 

Commercial Refrigeration Equipment 

Table V.50 through Table V.53 

summarizes the quantitative impacts 

estimated for each TSL for CRE. 

TABLE V.50—SUMMARY OF RESULTS FOR COMMERCIAL REFRIGERATION EQUIPMENT TSLS: NATIONAL IMPACTS* 

Category TSL 1 TSL 2 TSL 3 TSL 4 TSL 5 

Cumulative National Energy Savings 2017 through 2060 

quads 

1.176 ..................... 2.041 ..................... 2.844 ..................... 3.270 ..................... 4.140. 

With full-fuel cycle .......................... 1.195 ..................... 2.074 ..................... 2.889 ..................... 3.323 ..................... 4.207. 

Cumulative NPV of Customer Benefits 

2012$ billion 

3% discount rate ............................. 5.73 ....................... 9.50 ....................... 11.74 ..................... 9.70 ....................... (49.20). 

7% discount rate ............................. 2.52 ....................... 4.14 ....................... 4.93 ....................... 3.64 ....................... (28.39). 

Industry Impacts 

Change in Industry NPV (2012$ 

million).

(23.9) to (9.9) ........ (42.9) to (8.7) ........ (165.0) to (93.9) .... (320.9) to (189.4) .. (1,144.8) to 

(184.4). 

Change in Industry NPV (%) .......... (0.90) to (0.37) ...... (1.61) to (0.33) ...... (6.20) to (3.53) ...... (12.07) to (7.12) .... (43.04) to (6.93). 

Cumulative Emissions Reductions** 

CO2 (Mt) ......................................... 58.6 ....................... 101.7 ..................... 141.9 ..................... 163.2 ..................... 206.5. 

SO2 (kt) ........................................... 85.7 ....................... 148.8 ..................... 207.4 ..................... 238.5 ..................... 301.9. 

NOX (kt) .......................................... 39.2 ....................... 67.9 ....................... 94.3 ....................... 108.4 ..................... 137.4. 

Hg (t) ............................................... 0.10 ....................... 0.18 ....................... 0.25 ....................... 0.28 ....................... 0.36. 

N2O (kt) ........................................... 1.4 ......................... 2.4 ......................... 3.3 ......................... 3.8 ......................... 4.8. 

N2O (kt CO2eq) ............................... 408.8 ..................... 709.4 ..................... 988.1 ..................... 1136.2 ................... 1438.8. 

CH4 (kt) ........................................... 314.9 ..................... 546.6 ..................... 761.7 ..................... 875.9 ..................... 1109.0. 

CH4 (kt CO2eq) ............................... 7872.6 ................... 13665.9 ................. 19043.5 ................. 21898.5 ................. 27724.7. 

Monetary Value of Cumulative Emissions Reductions 

2012$ million† 

CO2 ................................................. 417 to 5794 ........... 725 to 10070 ......... 1012 to 14047 ....... 1164 to 16157 ....... 1473 to 20444. 

NOX—3% discount rate .................. 43.4 ....................... 75.0 ....................... 104.1 ..................... 119.6 ..................... 151.8. 

NOX—7% discount rate .................. 13.7 ....................... 23.6 ....................... 32.6 ....................... 37.4 ....................... 47.6. 

** ‘‘Mt’’ stands for million metric tons; ‘‘kt’’ stands for kilotons; ‘‘t’’ stands for tons. CO2eq is the quantity of CO2 that would have the same global 

warming potential (GWP). 

† Range of the economic value of CO2 reductions is based on estimates of the global benefit of reduced CO2 emissions. 


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TABLE V.51—SUMMARY OF RESULTS FOR COMMERCIAL REFRIGERATION EQUIPMENT TSLS: MEAN LCC SAVINGS

Mean LCC Savings* 

2012$ 

Equipment Class TSL 1 TSL 2 TSL 3 TSL 4 TSL 5 

VOP.RC.M ........................................................................... ........................ ........................ 922 ¥5 ¥4,203 

VOP.RC.L ............................................................................ ........................ ........................ 53 ¥148 ¥6,701 

VOP.SC.M ............................................................................ ........................ ........................ ........................ ¥54 ¥1,384 

VCT.RC.M ............................................................................ ........................ ........................ 542 41 ¥4,937 

VCT.RC.L ............................................................................. 647 647 526 93 ¥6,036 

VCT.SC.M ............................................................................ ¥10 214 226 163 ¥1,541 

VCT.SC.L ............................................................................. 2,503 4,709 5,001 2,812 2,812 

VCT.SC.I .............................................................................. 18 18 18 ¥68 ¥2,834 

VCS.SC.M ............................................................................ 223 518 363 305 ¥1,428 

VCS.SC.L ............................................................................. 588 550 507 495 ¥1,640 

VCS.SC.I .............................................................................. 41 114 113 113 ¥2,710 

SVO.RC.M ........................................................................... 564 564 564 ¥19 ¥2,691 

SVO.SC.M ............................................................................ ........................ ........................ ........................ 6 ¥917 

SOC.RC.M ........................................................................... ........................ ........................ ........................ ¥128 ¥2,268 

SOC.SC.M ........................................................................... ........................ ........................ ........................ ¥209 ¥2,204 

HZO.RC.M ........................................................................... ........................ ........................ ........................ ........................ ¥2,180 

HZO.RC.L ............................................................................ ........................ ........................ ........................ ........................ ¥4,249 

HZO.SC.M ............................................................................ ........................ 55 55 ¥4 ¥1,154 

HZO.SC.L ............................................................................. ........................ ........................ ........................ ........................ - 

HCT.SC.M ............................................................................ 66 165 101 43 ¥599 

HCT.SC.L ............................................................................. 428 435 293 248 ¥613 

HCT.SC.I .............................................................................. ........................ ........................ ........................ ........................ ¥1,240 

HCS.SC.M ............................................................................ 12 17 15 5 ¥568 

HCS.SC.L ............................................................................. 31 50 64 33 ¥590 

PD.SC.M .............................................................................. 8 163 165 150 ¥1,252 

* ‘‘NA’’ means ‘‘not applicable,’’ because for equipment classes HZO.RC.M, HZO.RC.L, and HZO.SC.L, TSLs 1 through 4 are associated with 

the baseline efficiency level. 

TABLE V.52—SUMMARY OF RESULTS FOR COMMERCIAL REFRIGERATION EQUIPMENT TSLS: MEDIAN PAYBACK PERIOD

Median Payback Period 

years 

Equipment Class TSL 1 TSL 2 TSL 3 TSL 4 TSL 5 

VOP.RC.M ........................................................................... ........................ ........................ 5.7 9.9 34.1 

VOP.RC.L ............................................................................ ........................ ........................ 6.1 11.3 310.0 

VOP.SC.M ............................................................................ ........................ ........................ ........................ 63.1 593.2 

VCT.RC.M ............................................................................ ........................ ........................ 2.1 6.6 364.7 

VCT.RC.L ............................................................................. 1.8 1.8 2.7 6.3 194.7 

VCT.SC.M ............................................................................ 23.4 4.8 5.3 7.0 96.2 

VCT.SC.L ............................................................................. 0.5 0.8 1.1 4.7 4.7 

VCT.SC.I .............................................................................. 7.2 7.2 7.2 16.2 663.6 

VCS.SC.M ............................................................................ 0.5 0.6 1.4 2.6 48.0 

VCS.SC.L ............................................................................. 0.6 1.3 2.5 2.7 31.8 

VCS.SC.I .............................................................................. 2.6 3.6 5.0 5.0 183.7 

SVO.RC.M ........................................................................... 6.2 6.2 6.2 10.4 29.9 

SVO.SC.M ............................................................................ ........................ ........................ ........................ 10.9 151.6 

SOC.RC.M ........................................................................... ........................ ........................ ........................ 38.0 114.1 

SOC.SC.M ........................................................................... ........................ ........................ ........................ 28.7 25.3 

HZO.RC.M ........................................................................... ........................ ........................ ........................ ........................ ........................

HZO.RC.L ............................................................................ ........................ ........................ ........................ ........................ 288.9 

HZO.SC.M ............................................................................ ........................ 6.9 6.9 11.8 194.7 

HZO.SC.L ............................................................................. ........................ ........................ ........................ ........................ ........................

HCT.SC.M ............................................................................ 2.5 4.7 5.8 9.2 46.6 

HCT.SC.L ............................................................................. 1.8 2.0 2.5 3.6 19.5 

HCT.SC.I .............................................................................. ........................ ........................ ........................ ........................ 23.8 

HCS.SC.M ............................................................................ 2.9 3.7 5.5 7.5 680.6 

HCS.SC.L ............................................................................. 1.4 1.7 2.5 6.2 68.9 

PD.SC.M .............................................................................. 9.3 5.3 5.6 6.0 102.2 

* ‘‘NA’’ means ‘‘not applicable,’’ because for equipment classes HZO.RC.M, HZO.RC.L, and HZO.SC.L, TSLs 1 through 4 are associated with 

the baseline efficiency level. 


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17808 Federal Register / Vol. 79, No. 60 / Friday, March 28, 2014 / Rules and Regulations 

TABLE V.53—SUMMARY OF RESULTS FOR COMMERCIAL REFRIGERATION EQUIPMENT TSLS: DISTRIBUTION OF CUSTOMER

LCC IMPACTS

Category TSL 1 * TSL 2 * TSL 3 * TSL 4 * TSL 5 * 

VOP.RC.M: 

Net Cost (%) ................................................................. 0 0 4 64 100 

No Impact (%) ............................................................... 100 100 41 0 0 

Net Benefit (%) ............................................................. 0 0 55 36 0 

VOP.RC.L: 

Net Cost (%) ................................................................. 0 0 7 59 100 

No Impact (%) ............................................................... 100 100 40 20 0 

Net Benefit (%) ............................................................. 0 0 53 21 0 

VOP.SC.M: 

Net Cost (%) ................................................................. 0 0 0 60 100 

No Impact (%) ............................................................... 100 100 100 40 0 

Net Benefit (%) ............................................................. 0 0 0 0 0 

VCT.RC.M: 

Net Cost (%) ................................................................. 0 0 0 36 100 

No Impact (%) ............................................................... 100 100 40 13 0 

Net Benefit (%) ............................................................. 0 0 60 51 0 

VCT.RC.L: 

Net Cost (%) ................................................................. 0 0 4 43 100 

No Impact (%) ............................................................... 40 40 20 0 0 

Net Benefit (%) ............................................................. 60 60 76 57 0 

VCT.SC.M: 

Net Cost (%) ................................................................. 71 1 3 17 100 

No Impact (%) ............................................................... 10 10 0 0 0 

Net Benefit (%) ............................................................. 18 89 97 83 0 

VCT.SC.L: 

Net Cost (%) ................................................................. 0 0 0 11 11 

No Impact (%) ............................................................... 10 0 0 0 0 

Net Benefit (%) ............................................................. 90 100 100 89 89 

VCT.SC.I: 

Net Cost (%) ................................................................. 10 10 10 65 84 

No Impact (%) ............................................................... 40 40 40 24 16 

Net Benefit (%) ............................................................. 50 50 50 11 0 

VCS.SC.M: 

Net Cost (%) ................................................................. 0 0 7 25 100 

No Impact (%) ............................................................... 40 40 10 10 0 

Net Benefit (%) ............................................................. 60 60 83 65 0 

VCS.SC.L: 

Net Cost (%) ................................................................. 0 0 7 9 100 

No Impact (%) ............................................................... 40 10 0 0 0 

Net Benefit (%) ............................................................. 60 90 93 91 0 

VCS.SC.I: 

Net Cost (%) ................................................................. 0 0 9 9 92 

No Impact (%) ............................................................... 40 32 17 17 8 

Net Benefit (%) ............................................................. 60 68 75 75 0 

SVO.RC.M: 

Net Cost (%) ................................................................. 7 7 7 67 100 

No Impact (%) ............................................................... 40 40 40 0 0 

Net Benefit (%) ............................................................. 54 54 54 33 0 

SVO.SC.M: 

Net Cost (%) ................................................................. 0 0 0 32 100 

No Impact (%) ............................................................... 100 100 100 40 0 

Net Benefit (%) ............................................................. 0 0 0 27 0 

SOC.RC.M: 

Net Cost (%) ................................................................. 0 0 0 60 100 

No Impact (%) ............................................................... 100 100 100 40 0 

Net Benefit (%) ............................................................. 0 0 0 0 0 

SOC.SC.M: 

Net Cost (%) ................................................................. 0 0 0 100 100 

No Impact (%) ............................................................... 100 100 100 0 0 

Net Benefit (%) ............................................................. 0 0 0 1 0 

HZO.RC.M: ** 

Net Cost (%) ................................................................. 0 0 0 0 60 

No Impact (%) ............................................................... 100 100 100 100 40 

Net Benefit (%) ............................................................. 0 0 0 0 0 

HZO.RC.L: ** 

Net Cost (%) ................................................................. 0 0 0 0 60 

No Impact (%) ............................................................... 100 100 100 100 40 

Net Benefit (%) ............................................................. 0 0 0 0 0 

HZO.SC.M: 

Net Cost (%) ................................................................. 0 5 5 50 100 

No Impact (%) ............................................................... 100 40 40 21 0 


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77For equipment classes HZO.RC.M, HZO.RC.L, 

and HZO.SC.L, and HCT.SC.I TSL 4 is associated 

with the baseline level because these equipment 

classes have only one efficiency level above 

baseline and each of those higher efficiency levels 

yields a negative NPV. Therefore, there are no 

efficiency levels that satisfy the criteria used for 

selection of TSLs 1 through 4. 

TABLE V.53—SUMMARY OF RESULTS FOR COMMERCIAL REFRIGERATION EQUIPMENT TSLS: DISTRIBUTION OF CUSTOMER

LCC IMPACTS—Continued 

Category TSL 1 * TSL 2 * TSL 3 * TSL 4 * TSL 5 * 

Net Benefit (%) ............................................................. 0 54 54 29 0 

HZO.SC.L: 

Net Cost (%) ................................................................. 0 0 0 0 0 

No Impact (%) ............................................................... 100 100 100 100 100 

Net Benefit (%) ............................................................. 0 0 0 0 0 

HCT.SC.M: 

Net Cost (%) ................................................................. 0 0 20 45 100 

No Impact (%) ............................................................... 40 40 0 0 0 

Net Benefit (%) ............................................................. 60 60 80 55 0 

HCT.SC.L: 

Net Cost (%) ................................................................. 0 0 10 29 87 

No Impact (%) ............................................................... 41 41 10 10 10 

Net Benefit (%) ............................................................. 59 59 80 61 3 

HCT.SC.I: 

Net Cost (%) ................................................................. 0 0 0 0 61 

No Impact (%) ............................................................... 100 100 100 100 39 

Net Benefit (%) ............................................................. 0 0 0 0 0 

HCS.SC.M: 

Net Cost (%) ................................................................. 0 1 10 42 91 

No Impact (%) ............................................................... 9 9 9 9 9 

Net Benefit (%) ............................................................. 91 90 80 48 0 

HCS.SC.L: 

Net Cost (%) ................................................................. 0 0 0 20 90 

No Impact (%) ............................................................... 10 10 10 10 10 

Net Benefit (%) ............................................................. 90 90 90 70 0 

PD.SC.M: 

Net Cost (%) ................................................................. 28 3 5 8 100 

No Impact (%) ............................................................... 39 0 0 0 0 

Net Benefit (%) ............................................................. 33 97 95 92 0 

* Values have been rounded to the nearest integer. Therefore, some of the percentages may not add up to 100. 

TSL 5 corresponds to the max-tech 

level for all the equipment classes and 

offers the potential for the highest 

cumulative energy savings. The 

estimated energy savings from TSL 5 is 

4.21 quads, an amount DOE deems 

significant. TSL 5 shows a net negative 

NPV for customers with estimated 

increased costs valued at $28.39 billion 

at a 7-percent discount rate. Estimated 

emissions reductions are 206.5 Mt of 

CO2, 137.4 kt of NOX, 301.9 kt of SO2, 

and 0.36 tons of Hg. The CO2 emissions 

have a value of $1.5 billion to $20.4 

billion and the NOX emissions have a 

value of $47.6 million at a 7-percent 

discount rate. 

For TSL 5 the mean LCC savings for 

all equipment classes, except for 

VCT.SC.L are negative, implying an 

increase in LCC. The median PBP is 

longer than the lifetime of the 

equipment for nearly all/most 

equipment classes. The share of 

customers that would experience a net 

benefit (positive LCC savings) is very 

low in nearly all equipment classes. 

At TSL 5, manufacturers may expect 

diminished profitability due to large 

increases in product costs, capital 

investments in equipment and tooling, 

and expenditures related to engineering 

and testing. The projected change in 

INPV ranges from a decrease of $1,144.8 

million to a decrease of $184.4 million 

based on DOE’s manufacturer markup 

scenarios. The upper bound of ¥$184.4 

million is considered an optimistic 

scenario for manufacturers because it 

assumes manufacturers can fully pass 

on substantial increases in equipment 

costs to their customers. DOE recognizes 

the risk of large negative impacts on 

industry if manufacturers’ expectations 

concerning reduced profit margins are 

realized. TSL 5 could reduce 

commercial refrigeration equipment 

INPV by up to 43.04 percent if impacts 

reach the lower bound of the range. 

After carefully considering the 

analyses results and weighing the 

benefits and burdens of TSL 5, DOE 

finds that the benefits to the Nation 

from TSL 5, in the form of energy 

savings and emissions reductions, are 

outweighed by the burdens, in the form 

of a large decrease in customer NPV, 

negative LCC savings and very long 

PBPs for nearly all equipment classes, 

and a decrease in manufacturer INPV. 

DOE concludes that the burdens of TSL 

5 outweigh the benefits and, therefore, 

does not find TSL 5 to be economically 

justifiable. 

TSL 4 corresponds to the highest 

efficiency level, in each equipment 

class, with a near positive NPV at a 7- 

percent discount rate. The estimated 

energy savings from TSL 4 is 3.32 

quads, an amount DOE deems 

significant. TSL 4 shows a net positive 

NPV for customers with estimated 

benefit of at $3.64 billion at a 7-percent 

discount rate. Estimated emissions 

reductions are 163.2 Mt of CO2, 108.4 kt 

of NOX, 238.5 kt of SO2, and 0.28 tons 

of Hg. The CO2 emissions have a value 

of $1.2 billion to $16.1 billion and the 

NOX emissions have a value of $37.4 

million at a 7-percent discount rate. 

At TSL 4, the mean LCC savings 

among equipment classes affected by 

standards range from ¥$209 for 

HCS.SC.M to $2,812 for VOP.RC.M.77

The median PBP ranges from 2.6 years 

to 63.1 years. The share of customers 

that would experience a net benefit 

(positive LCC savings) ranges from 0 

percent to 91 percent. 

At TSL 4, the projected change in 

INPV ranges from a decrease of $320.9 

million to a decrease of $189.4 million. 

At TSL 4, DOE recognizes the risk of 

negative impacts if manufacturers’ 

expectations concerning reduced profit 


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78Equipment classes VOP.SC.M, SVO.SC.M, 

SOC.RC.M, SOC.SC.M, HZO.RC.M, HZO.RC.L, 

HZO.SC.L, and HCT.SC.I at TSL 3 are associated 

with the baseline level. 

margins are realized. If the lower bound 

of the range of impacts is reached, as 

DOE expects, TSL 4 could result in a net 

loss of 12.07 percent in INPV for 

commercial refrigeration equipment 

manufacturers. 

After carefully considering the 

analyses results and weighing the 

benefits and burdens of TSL 4, DOE 

finds that the benefits to the Nation 

from TSL 4, in the form of energy 

savings and emissions reductions, an 

increase in customer NPV, and positive 

mean LCC savings for many equipment 

classes, are outweighed by the burdens, 

in the form of negative mean LCC 

savings for many equipment classes 

(including several classes with a 

significant share of total shipments), 

long PBPs for some equipment classes, 

the fact that over half of customers 

would experience a net cost (negative 

LCC savings) in many equipment 

classes, and a decrease in manufacturer 

INPV. DOE concludes that the burdens 

of TSL 4 outweigh the benefits and, 

therefore, does not find TSL 4 to be 

economically justifiable. 

Next, DOE considered TSL 3. The 

estimated energy savings from TSL 3 is 

2.89 quads, an amount DOE deems 

significant. TSL 3 shows a positive NPV 

for customers valued at $4.93 billion at 

a 7-percent discount rate. Estimated 

emissions reductions are 141.9 Mt of 

CO2, 94.3 kt of NOX, 207.4 kt of SO2, 

and 0.25 tons of Hg. The CO2 emissions 

have a value of $1.0 billion to $14.0 

billion and the NOX emissions have a 

value of $32.6 million at a 7-percent 

discount rate. 

At TSL 3, the mean LCC savings for 

affected equipment classes range from 

$18 to $5,001.78 The median PBP ranges 

from 1.1 years to 7.2 years. The share of 

customers that would experience a net 

benefit (positive LCC savings) is over 50 

percent for all affected equipment 

classes. 

At TSL 3, the projected change in 

INPV ranges from a decrease of $165.0 

million to a decrease of $93.9 million. 

At TSL 3, DOE recognizes the risk of 

negative impacts if manufacturers’ 

expectations concerning reduced profit 

margins are realized. If the lower bound 

of the range of impacts is reached, as 

DOE expects, TSL 3 could result in a net 

loss of 6.20 percent in INPV for 

commercial refrigeration equipment 

manufacturers. 

After careful consideration of the 

analyses results and, weighing the 

benefits and burdens of TSL 3, DOE 

finds that the benefits to the Nation 

from TSL 3, in the form of energy 

savings and emissions reductions, an 

increase in customer NPV, positive 

mean LCC savings for all affected 

equipment classes, PBPs that are less 

than seven years for most of the affected 

equipment classes, and the fact that over 

half of customers would experience a 

net benefit in nearly all affected 

equipment classes, outweigh the 

burdens, in the form of a decrease in 

manufacturer INPV. The Secretary 

concludes that TSL 3 will offer the 

maximum improvement in efficiency 

that is technologically feasible and 

economically justified and will result in 

the significant conservation of energy. 

Therefore, DOE today is adopting 

standards at TSL 3 for commercial 

refrigeration equipment. The amended 

energy conservation standards for 

commercial refrigeration equipment, 

which consist of maximum daily energy 

consumption (MDEC) values as a 

function of either refrigerated volume or 

total display area (TDA), are shown in 

Table V.54. 

TABLE V.54—ENERGY CONSERVATION STANDARDS FOR COMMERCIAL REFRIGERATION EQUIPMENT

[Compliance required starting March 27, 2017] 

Equipment class * Standard level ** ,† Equipment class * Standard level **,† 

VCT.RC.L ....................................... 0.49 × TDA + 2.61. VOP.RC.I ...................................... 2.79 × TDA + 8.7. 

VOP.RC.M ..................................... 0.63 × TDA + 4.07. SVO.RC.L ..................................... 2.2 × TDA + 6.85. 

SVO.RC.M ..................................... 0.66 × TDA + 3.18. SVO.RC.I ...................................... 2.79 × TDA + 8.7. 

HZO.RC.L ...................................... 0.55 × TDA + 6.88. HZO.RC.I ...................................... 0.7 × TDA + 8.74. 

HZO.RC.M ..................................... 0.35 × TDA + 2.88. VOP.SC.L ..................................... 4.25 × TDA + 11.82. 

VCT.RC.M ...................................... 0.15 × TDA + 1.95. VOP.SC.I ...................................... 5.4 × TDA + 15.02. 

VOP.RC.L ...................................... 2.2 × TDA + 6.85. SVO.SC.L ..................................... 4.26 × TDA + 11.51. 

SOC.RC.M ..................................... 0.44 × TDA + 0.11. SVO.SC.I ...................................... 5.41 × TDA + 14.63. 

VOP.SC.M ..................................... 1.69 × TDA + 4.71. HZO.SC.I ...................................... 2.42 × TDA + 9. 

SVO.SC.M ..................................... 1.7 × TDA + 4.59. SOC.RC.L ..................................... 0.93 × TDA + 0.22. 

HZO.SC.L ...................................... 1.9 × TDA + 7.08. SOC.RC.I ...................................... 1.09 × TDA + 0.26. 

HZO.SC.M ..................................... 0.72 × TDA + 5.55. SOC.SC.I ...................................... 1.53 × TDA + 0.36. 

HCT.SC.I ........................................ 0.56 × TDA + 0.43. VCT.RC.I ...................................... 0.58 × TDA + 3.05. 

VCT.SC.I ........................................ 0.62 × TDA + 3.29. HCT.RC.M .................................... 0.16 × TDA + 0.13. 

VCS.SC.I ........................................ 0.34 × V + 0.88. HCT.RC.L ..................................... 0.34 × TDA + 0.26. 

VCT.SC.M ...................................... 0.1 × V + 0.86. HCT.RC.I ...................................... 0.4 × TDA + 0.31. 

VCT.SC.L ....................................... 0.29 × V + 2.95. VCS.RC.M .................................... 0.1 × V + 0.26. 

VCS.SC.M ...................................... 0.05 × V + 1.36. VCS.RC.L ..................................... 0.21 × V + 0.54. 

VCS.SC.L ....................................... 0.22 × V + 1.38. VCS.RC.I ...................................... 0.25 × V + 0.63. 

HCT.SC.M ...................................... 0.06 × V + 0.37. HCS.SC.I ...................................... 0.34 × V + 0.88. 

HCT.SC.L ....................................... 0.08 × V + 1.23. HCS.RC.M .................................... 0.1 × V + 0.26. 

HCS.SC.M ..................................... 0.05 × V + 0.91. HCS.RC.L ..................................... 0.21 × V + 0.54. 

HCS.SC.L ...................................... 0.06 × V + 1.12. HCS.RC.I ...................................... 0.25 × V + 0.63. 

PD.SC.M ........................................ 0.11 × V + 0.81. SOC.SC.L ..................................... 1.1 × TDA + 2.1. 

SOC.SC.M ..................................... 0.52 × TDA + 1. 

* Equipment class designations consist of a combination (in sequential order separated by periods) of: (1) An equipment family code (VOP = vertical open, SVO 

= semivertical open, HZO = horizontal open, VCT = vertical closed with transparent doors, VCS = vertical closed with solid doors, HCT = horizontal closed with 

transparent doors, HCS = horizontal closed with solid doors, SOC = service over counter, or PD = pull-down); (2) an operating mode code (RC = remote condensing or SC = self-contained); and (3) a rating temperature code (M = medium temperature (38 ± 2 °F), L = low temperature (0 ± 2 °F), or I = ice-cream temperature (¥15 ± 2 °F)). For example, ‘‘VOP.RC.M’’ refers to the ‘‘vertical open, remote condensing, medium temperature’’ equipment class. See discussion in 

chapter 3 of the final rule technical support document (TSD) for a more detailed explanation of the equipment class terminology. ** ‘‘TDA’’ is the total display area of the case, as measured in the Air-Conditioning, Heating, and Refrigeration Institute (AHRI) Standard 1200–2010, appendix D. 

† ‘‘V’’ is the volume of the case, as measured in American National Standards Institute (ANSI)/Association of Home Appliance Manufacturers (AHAM) Standard 

HRF–1–2004. 


tkelley on DSK3SPTVN1PROD with RULES2
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79 DOE used a two-step calculation process to 

convert the time-series of costs and benefits into 

annualized values. First, DOE calculated a present 

value in 2013, the year used for discounting the 

NPV of total consumer costs and savings, for the 

time-series of costs and benefits using discount 

rates of three and seven percent for all costs and 

benefits except for the value of CO2 reductions. For 

the latter, DOE used a range of discount rates, as 

shown in Table I.3. From the present value, DOE 

then calculated the fixed annual payment over a 30- 

year period (2017 through 2046) that yields the 

same present value. The fixed annual payment is 

the annualized value. Although DOE calculated 

annualized values, this does not imply that the 

time-series of cost and benefits from which the 

annualized values were determined is a steady 

stream of payments. 

2. Summary of Benefits and Costs 

(Annualized) of the Standards 

The benefits and costs of today’s 

standards, for equipment sold in 2017– 

2046, can also be expressed in terms of 

annualized values. The annualized 

monetary values are the sum of (1) the 

annualized national economic value of 

the benefits from operating the product 

(consisting primarily of operating cost 

savings from using less energy, minus 

increases in equipment purchase and 

installation costs, which is another way 

of representing consumer NPV), plus (2) 

the annualized monetary value of the 

benefits of emission reductions, 

including CO2 emission reductions.79

Estimates of annualized benefits and 

costs of today’s standards are shown in 

Table V.55. The results under the 

primary estimate are as follows. Using a 

7-percent discount rate for benefits and 

costs other than CO2 reduction, for 

which DOE used a 3-percent discount 

rate along with the average SCC series 

that uses a 3-percent discount rate, the 

cost of the standards in today’s rule is 

$256 million per year in increased 

equipment costs, while the benefits are 

$710 million per year in reduced 

equipment operating costs, $246 million 

in CO2 reductions, and $3.01 million in 

reduced NOX emissions. In this case, the 

net benefit amounts to $704 million per 

year. Using a 3-percent discount rate for 

all benefits and costs and the average 

SCC series, the cost of the standards in 

today’s rule is $264 million per year in 

increased equipment costs, while the 

benefits are $900 million per year in 

reduced operating costs, $246 million in 

CO2 reductions, and $5.64 million in 

reduced NOX emissions. In this case, the 

net benefit amounts to $888 million per 

year. 

TABLE V.55—ANNUALIZED BENEFITS AND COSTS OF NEW AND AMENDED STANDARDS FOR COMMERCIAL REFRIGERATION

EQUIPMENT

Discount rate 

Million 2012$/year 

Primary estimate* Low net benefits estimate* High net benefits estimate* 

Benefits 

Operating Cost Savings .... 7% ..................................... 710 .................................... 688 .................................... 744. 

3% ..................................... 900 .................................... 865 .................................... 947. 

CO2 Reduction at ($11.8/t 

case) **.

5% ..................................... 73 ...................................... 73 ...................................... 73. 

CO2 Reduction at ($39.7/t 

case) **.

3% ..................................... 246 .................................... 246 .................................... 246. 

CO2 Reduction at ($61.2/t 

case)**.

2.5% .................................. 361 .................................... 361 .................................... 361. 

CO2 Reduction at ($117.0/t 

case) **.

3% ..................................... 760 .................................... 760 .................................... 760. 

NOX Reduction at ($2,591/

ton) **.

7% ..................................... 3.01 ................................... 3.01 ................................... 3.01. 

3% ..................................... 5.64 ................................... 5.64 ................................... 5.64. 

Total Benefits † ........... 7% plus CO2 range ........... 786 to 1,474 ...................... 764 to 1,451 ...................... 820 to 1,508. 

7% ..................................... 960 .................................... 937 .................................... 994. 

3% plus CO2 range ........... 978 to 1,666 ...................... 943 to 1,631 ...................... 1,026 to 1,713. 

3% ..................................... 1,152 ................................. 1,117 ................................. 1,200. 

Costs 

Incremental Equipment 

Costs.

7% ..................................... 256 .................................... 250 .................................... 261. 

3% ..................................... 264 .................................... 258 .................................... 271. 

Net Benefits 

Total † .................. 7% plus CO2 range ........... 530 to 1,218 ...................... 513 to 1,201 ...................... 559 to 1,246. 

7% ..................................... 704 .................................... 687 .................................... 733. 

3% plus CO2 range ........... 714 to 1,402 ...................... 685 to 1,373 ...................... 755 to 1,442. 

3% ..................................... 888 .................................... 859 .................................... 929. 

* This table presents the annualized costs and benefits associated with commercial refrigeration equipment shipped in 2017–2046. These results include benefits to customers which accrue after 2046 from the products purchased in 2017–2046. The results account for the incremental 

variable and fixed costs incurred by manufacturers due to the amended standard, some of which may be incurred in preparation for the final rule. 

The primary, low, and high estimates utilize projections of energy prices from the AEO 2013 Reference case, Low Estimate, and High Estimate, 

respectively. In addition, incremental equipment costs reflect a medium decline rate for projected product price trends in the Primary Estimate, a 

low decline rate for projected product price trends in the Low Benefits Estimate, and a high decline rate for projected product price trends in the 

High Benefits Estimate. The methods used to derive projected price trends are explained in section IV.H. 

** The CO2 values represent global monetized values of the SCC, in 2012$, in 2015 under several scenarios of the updated SCC values. The 

first three cases use the averages of SCC distributions calculated using 5%, 3%, and 2.5% discount rates, respectively. The fourth case represents the 95th percentile of the SCC distribution calculated using a 3% discount rate. The SCC time series used by DOE incorporate an escalation factor. The value for NO X is the average of the low and high values used in DOE’s analysis. 


tkelley on DSK3SPTVN1PROD with RULES2
17812 Federal Register / Vol. 79, No. 60 / Friday, March 28, 2014 / Rules and Regulations 

80 ‘‘AHRI Certification Directory.’’ AHRI 

Certification Directory. AHRI. (Available at: https:// 

www.ahridirectory.org/ahridirectory/pages/

home.aspx) (Last accessed October 10, 2011). See 

www.ahridirectory.org/ahriDirectory/pages/

home.aspx. 

81 ‘‘Dynamic Small Business Search.’’ SBA. 

(Available at: See http://dsbs.sba.gov/dsbs/search/

dsp_dsbs.cfm) (Last accessed October 12, 2011). 

† Total Benefits for both the 3-percent and 7-percent cases are derived using the series corresponding to average SCC with 3-percent discount 

rate. In the rows labeled ‘‘7% plus CO2 range’’ and ‘‘3% plus CO2 range,’’ the operating cost and NOX benefits are calculated using the labeled 

discount rate, and those values are added to the full range of CO2 values. 

VI. Procedural Issues and Regulatory 

Review 

A. Review Under Executive Orders 

12866 and 13563 

Section 1(b)(1) of Executive Order 

12866, ‘‘Regulatory Planning and 

Review,’’ 58 FR 51735 (October 4, 1993), 

requires each agency to identify the 

problem that it intends to address, 

including, where applicable, the failures 

of private markets or public institutions 

that warrant new agency action, as well 

as to assess the significance of that 

problem. The problems that today’s 

standards address are as follows: 

(1) For certain segments of the 

companies that purchase commercial 

refrigeration equipment, such as small 

grocers, there may be a lack of consumer 

information and/or information 

processing capability about energy 

efficiency opportunities in the 

commercial refrigeration equipment 

market. 

(2) There is asymmetric information 

(one party to a transaction has more and 

better information than the other) and/ 

or high transactions costs (costs of 

gathering information). 

(3) There are external benefits 

resulting from improved energy 

efficiency of commercial refrigeration 

equipment that are not captured by the 

users of such equipment. These benefits 

include externalities related to 

environmental protection that are not 

reflected in energy prices, such as 

reduced emissions of greenhouse gases. 

DOE attempts to quantify some of the 

external benefits through use of Social 

Cost of Carbon values. 

In addition, DOE has determined that 

today’s regulatory action is an 

‘‘economically significant regulatory 

action’’ under section 3(f)(1) of 

Executive Order 12866. Accordingly, 

section 6(a)(3) of the Executive Order 

requires that DOE prepare a regulatory 

impact analysis (RIA) on today’s rule 

and that the Office of Information and 

Regulatory Affairs (OIRA) in the Office 

of Management and Budget (OMB) 

review this rule. DOE presented to OIRA 

for review the draft rule and other 

documents prepared for this 

rulemaking, including the RIA, and has 

included these documents in the 

rulemaking record. The assessments 

prepared pursuant to Executive Order 

12866 can be found in the technical 

support document for this rulemaking. 

DOE has also reviewed this regulation 

pursuant to Executive Order 13563, 

issued on January 18, 2011 (76 FR 3281, 

January 21, 2011). EO 13563 is 

supplemental to and explicitly reaffirms 

the principles, structures, and 

definitions governing regulatory review 

established in Executive Order 12866. 

To the extent permitted by law, agencies 

are required by Executive Order 13563 

to: (1) Propose or adopt a regulation 

only upon a reasoned determination 

that its benefits justify its costs 

(recognizing that some benefits and 

costs are difficult to quantify); (2) tailor 

regulations to impose the least burden 

on society, consistent with obtaining 

regulatory objectives, taking into 

account, among other things, and to the 

extent practicable, the costs of 

cumulative regulations; (3) select, in 

choosing among alternative regulatory 

approaches, those approaches that 

maximize net benefits (including 

potential economic, environmental, 

public health and safety, and other 

advantages; distributive impacts; and 

equity); (4) to the extent feasible, specify 

performance objectives, rather than 

specifying the behavior or manner of 

compliance that regulated entities must 

adopt; and (5) identify and assess 

available alternatives to direct 

regulation, including providing 

economic incentives to encourage the 

desired behavior, such as user fees or 

marketable permits, or providing 

information upon which choices can be 

made by the public. 

DOE emphasizes as well that 

Executive Order 13563 requires agencies 

to use the best available techniques to 

quantify anticipated present and future 

benefits and costs as accurately as 

possible. In its guidance, the Office of 

Information and Regulatory Affairs has 

emphasized that such techniques may 

include identifying changing future 

compliance costs that might result from 

technological innovation or anticipated 

behavioral changes. For the reasons 

stated in the preamble, DOE believes 

that today’s final rule is consistent with 

these principles, including the 

requirement that, to the extent 

permitted by law, benefits justify costs 

and that net benefits are maximized. 

B. Review Under the Regulatory 

Flexibility Act 

The Regulatory Flexibility Act (5 

U.S.C. 601 et seq.) requires preparation 

of an final regulatory flexibility analysis 

(FRFA) for any rule that by law must be 

proposed for public comment, unless 

the agency certifies that the rule, if 

promulgated, will not have a significant 

economic impact on a substantial 

number of small entities. As required by 

Executive Order 13272, ‘‘Proper 

Consideration of Small Entities in 

Agency Rulemaking,’’ 67 FR 53461 

(August 16, 2002), DOE published 

procedures and policies on February 19, 

2003, to ensure that the potential 

impacts of its rules on small entities are 

properly considered during the 

rulemaking process. 68 FR 7990. DOE 

has made its procedures and policies 

available on the Office of the General 

Counsel’s Web site (http://energy.gov/

gc/office-general-counsel). 

For manufacturers of commercial 

refrigeration equipment, the Small 

Business Administration (SBA) has set a 

size threshold, which defines those 

entities classified as ‘‘small businesses’’ 

for the purposes of the statute. DOE 

used the SBA’s small business size 

standards to determine whether any 

small entities would be subject to the 

requirements of the rule. 65 FR 30836, 

30848 (May 15, 2000), as amended at 65 

FR 53533, 53544 (September 5, 2000) 

and codified at 13 CFR Part 121.The size 

standards are listed by North American 

Industry Classification System (NAICS) 

code and industry description and are 

available at http://www.sba.gov/sites/

default/files/files/Size_Standards_

Table.pdf. Commercial refrigeration 

equipment manufacturing is classified 

under NAICS 333415, ‘‘AirConditioning and Warm Air Heating 

Equipment and Commercial and 

Industrial Refrigeration Equipment 

Manufacturing.’’ The SBA sets a 

threshold of 750 employees or less for 

an entity to be considered as a small 

business for this category. Based on this 

threshold, DOE present the following 

FRFA analysis: 

1. Description and Estimated Number of 

Small Entities Regulated 

During its market survey, DOE used 

available public information to identify 

potential small manufacturers. DOE’s 

research involved industry trade 

association membership directories 

(including AHRI), public databases (e.g., 

AHRI Directory,80 the SBA Database 81), 

individual company Web sites, and 


tkelley on DSK3SPTVN1PROD with RULES2
Federal Register / Vol. 79, No. 60 / Friday, March 28, 2014 / Rules and Regulations 17813 

82 ‘‘D&B √ Business Information √ Get Credit 

Reports √ 888 480–6007.’’. Dun & Bradstreet 

(Available at: www.dnb.com) (Last accessed October 

10, 2011). See www.dnb.com/. 

83 ‘‘Hoovers √ Company Information √ Industry 

Information √ Lists.’’ D&B (2013) (Available at: See 

http://www.hoovers.com/) (Last accessed December 

12, 2012). 

84 32nd Annual Portrait of the U.S. Appliance 

Industry. Appliance Magazine. September 2009. 

66(7). 

market research tools (e.g., Dunn and 

Bradstreet reports 82 and Hoovers 

reports 83) to create a list of companies 

that manufacture or sell products 

covered by this rulemaking. DOE also 

asked stakeholders and industry 

representatives if they were aware of 

any other small manufacturers during 

manufacturer interviews and at DOE 

public meetings. DOE reviewed publicly 

available data and contacted select 

companies on its list, as necessary, to 

determine whether they met the SBA’s 

definition of a small business 

manufacturer of covered commercial 

refrigeration equipment. DOE screened 

out companies that do not offer 

products covered by this rulemaking, do 

not meet the definition of a ‘‘small 

business,’’ or are foreign owned. 

DOE identified 54 companies selling 

commercial refrigeration equipment in 

the United States. Nine of the 

companies are foreign-owned firms. Of 

the remaining 45 companies, about 70 

percent (32 companies) are small 

domestic manufacturers. DOE contacted 

eight domestic commercial refrigeration 

equipment manufacturers for interviews 

and all eight companies accepted. Of 

these eight companies, four were small 

businesses. 

2. Description and Estimate of 

Compliance Requirements 

The 32 identified domestic 

manufacturers of commercial 

refrigeration equipment that qualify as 

small businesses under the SBA size 

standard account for approximately 26 

percent of commercial refrigeration 

equipment shipments.84 While some 

small businesses have significant market 

share (e.g., Continental has a 4-percent 

market share for foodservice commercial 

refrigeration 84), the majority of small 

businesses have less than a 1-percent 

market share. These smaller firms often 

specialize in designing custom products 

and servicing niche markets. 

At the amended level, the average 

small manufacturer is expected to face 

capital conversion costs that are nearly 

five times typical annual capital 

expenditures, and product conversion 

costs that are roughly double the typical 

annual R&D spending, as shown in 

Table VI.1. At the amended level, the 

conversion costs are driven by the 

incorporation of thicker insulation into 

case designs. The thicker case designs 

necessitate the purchase of new jigs for 

production. Manufacturers estimate of 

the cost of modifying an existing jig at 

approximately $50,000. Manufacturer 

estimates of the cost of a new jig ranged 

from $100,000 to $300,000, depending 

on the jig size and design. In addition 

to the cost of jigs, changes in case 

thickness may require product redesign 

due to changes in the interior volume of 

the equipment. All shelving and 

internally fitted components would 

need to be redesigned to fit the revised 

cabinet’s interior dimensions. 

Furthermore, changes in insulation and 

in refrigeration components could 

necessitate new industry certifications. 

The proposed standard could cause 

small manufacturers to be at a 

disadvantage relative to large 

manufacturers. The capital conversion 

costs represent a smaller percentage of 

annual capital expenditures for large 

manufacturers than for small 

manufacturers. The capital conversion 

costs are 49 percent of annual capital 

expenditures for an average large 

manufacturer, while capital conversion 

costs are 278 percent of annual capital 

expenditures for an average small 

manufacturer. Small manufacturers may 

have greater difficulty obtaining credit, 

or may obtain less favorable terms than 

larger competitors when financing the 

equipment necessary to meet the 

amended standard. 

Manufacturers indicated that many 

design options evaluated in the 

engineering analysis (e.g., higher 

efficiency lighting, motors, and 

compressors) would force them to 

purchase more expensive components. 

Due to smaller purchasing volumes, 

small manufacturers typically pay 

higher prices for components, while 

their large competitors receive volume 

discounts. At the amended standard, 

small businesses will likely have greater 

increases in component costs than large 

businesses and will thus be at a pricing 

disadvantage. 

To estimate how small manufacturers 

would be impacted, DOE used the 

market share of small manufacturers to 

estimate the annual revenue, earnings 

before interest and tax (EBIT), R&D 

expense, and capital expenditures for a 

typical small manufacturer. DOE then 

compared these costs to the required 

capital and product conversion costs at 

each TSL for both an average small 

manufacturer (Table VI.1) and an 

average large manufacturer (Table VI.2). 

The conversion costs in these tables are 

presented relative to annual financial 

metrics for the purposes of comparing 

impacts of small versus large 

manufacturers. In practice, these 

conversion costs will likely be spread 

out over a period of multiple years. TSL 

3 represents the level adopted in today’s 

final rule: 

TABLE VI.1—COMPARISON OF AN AVERAGE SMALL COMMERCIAL REFRIGERATION EQUIPMENT MANUFACTURER’S

CONVERSION COSTS TO ANNUAL EXPENSES, REVENUE, AND PROFIT

TSL 

Capital conversion cost 

as a percentage of annual capital expenditures 

Product conversion cost 

as a percentage of 

annual R&D expense 

Total conversion cost as 

a percentage of annual 

revenue 

Total conversion cost as 

a percentage of annual 

EBIT 

TSL 1 ............................................... 20 45 1 13 

TSL 2 ............................................... 20 71 2 18 

TSL 3 ............................................... 330 278 11 129 

TSL 4 ............................................... 913 428 26 296 

TSL 5 ............................................... 2838 622 70 792 


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TABLE VI.2—COMPARISON OF AN AVERAGE LARGE COMMERCIAL REFRIGERATION EQUIPMENT MANUFACTURER’S

CONVERSION COSTS TO ANNUAL EXPENSES, REVENUE, AND PROFIT

TSL 

Capital conversion cost 

as a percentage of annual capital expenditures 

Product conversion cost 

as a percentage of 

annual R&D expense 

Total conversion cost as 

a percentage of annual 

revenue 

Total conversion cost as 

a percentage of annual 

EBIT 

TSL 1 ............................................... 3 49 1 10 

TSL 2 ............................................... 3 49 1 10 

TSL 3 ............................................... 46 49 2 20 

TSL 4 ............................................... 128 49 3 40 

TSL 5 ............................................... 398 49 9 104 

Small firms would likely be at a 

disadvantage relative to larger firms in 

meeting the amended energy 

conservation standard for commercial 

refrigeration equipment. The small 

businesses face disadvantages in terms 

of access to capital, the cost of re-tooling 

production lines and investing in 

redesigns, and pricing for key 

components. As a result, DOE could not 

certify that the amended standards 

would not have a significant impact on 

a significant number of small 

businesses. 

3. Duplication, Overlap, and Conflict 

With Other Rules and Regulations 

DOE is not aware of any rules or 

regulations that duplicate, overlap, or 

conflict with the rule being adopted 

today. 

4. Significant Alternatives to the Rule 

The discussion above analyzes 

impacts on small businesses that would 

result from DOE’s amended standards. 

In addition to the other TSLs being 

considered, the rulemaking TSD 

includes a regulatory impact analysis 

(RIA). For commercial refrigeration 

equipment, the RIA discusses the 

following policy alternatives: (1) No 

change in standard; (2) consumer 

rebates; (3) consumer tax credits; and (4) 

manufacturer tax credits; (5) voluntary 

energy efficiency targets; and (6) bulk 

government purchases. While these 

alternatives may mitigate to some 

varying extent the economic impacts on 

small entities compared to the 

standards, DOE determined that the 

energy savings of these alternatives are 

significantly smaller than those that 

would be expected to result from 

adoption of the amended standard 

levels. Accordingly, DOE is declining to 

adopt any of these alternatives and is 

adopting the standards set forth in this 

rulemaking. (See chapter 17 of the final 

rule TSD for further detail on the policy 

alternatives DOE considered.) 

C. Review Under the Paperwork 

Reduction Act 

Manufacturers of commercial 

refrigeration equipment must certify to 

DOE that their products comply with 

any applicable energy conservation 

standards. In certifying compliance, 

manufacturers must test their products 

according to the DOE test procedures for 

commercial refrigeration equipment, 

including any amendments adopted for 

those test procedures. DOE has 

established regulations for the 

certification and recordkeeping 

requirements for all covered consumer 

products and commercial equipment, 

including commercial refrigeration 

equipment. (76 FR 12422 (March 7, 

2011). The collection-of-information 

requirement for the certification and 

recordkeeping is subject to review and 

approval by OMB under the Paperwork 

Reduction Act (PRA). This requirement 

has been approved by OMB under OMB 

control number 1910–1400. Public 

reporting burden for the certification is 

estimated to average 20 hours per 

response, including the time for 

reviewing instructions, searching 

existing data sources, gathering and 

maintaining the data needed, and 

completing and reviewing the collection 

of information. 

Notwithstanding any other provision 

of the law, no person is required to 

respond to, nor shall any person be 

subject to a penalty for failure to comply 

with, a collection of information subject 

to the requirements of the PRA, unless 

that collection of information displays a 

currently valid OMB Control Number. 

D. Review Under the National 

Environmental Policy Act of 1969 

Pursuant to the National 

Environmental Policy Act (NEPA) of 

1969, DOE has determined that the rule 

fits within the category of actions 

included in Categorical Exclusion (CX) 

B5.1 and otherwise meets the 

requirements for application of a CX. 

See 10 CFR part 1021, App. B, B5.1(b); 

§ 1021.410(b) and Appendix B, B(1)–(5). 

The rule fits within the category of 

actions because it is a rulemaking that 

establishes energy conservation 

standards for consumer products or 

industrial equipment, and for which 

none of the exceptions identified in CX 

B5.1(b) apply. Therefore, DOE has made 

a CX determination for this rulemaking, 

and DOE does not need to prepare an 

Environmental Assessment or 

Environmental Impact Statement for 

this rule. DOE’s CX determination for 

this rule is available at http://

cxnepa.energy.gov/. 

E. Review Under Executive Order 13132 

Executive Order 13132, ‘‘Federalism.’’ 

64 FR 43255 (Aug. 10, 1999) imposes 

certain requirements on Federal 

agencies formulating and implementing 

policies or regulations that preempt 

State law or that have Federalism 

implications. The Executive Order 

requires agencies to examine the 

constitutional and statutory authority 

supporting any action that would limit 

the policymaking discretion of the 

States and to carefully assess the 

necessity for such actions. The 

Executive Order also requires agencies 

to have an accountable process to 

ensure meaningful and timely input by 

State and local officials in the 

development of regulatory policies that 

have Federalism implications. On 

March 14, 2000, DOE published a 

statement of policy describing the 

intergovernmental consultation process 

it will follow in the development of 

such regulations. 65 FR 13735. EPCA 

governs and prescribes Federal 

preemption of State regulations as to 

energy conservation for the products 

that are the subject of today’s final rule. 

States can petition DOE for exemption 

from such preemption to the extent, and 

based on criteria, set forth in EPCA. (42 

U.S.C. 6297) No further action is 

required by Executive Order 13132. 

F. Review Under Executive Order 12988 

With respect to the review of existing 

regulations and the promulgation of 

new regulations, section 3(a) of 

Executive Order 12988, ‘‘Civil Justice 

Reform,’’ imposes on Federal agencies 

the general duty to adhere to the 


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following requirements: (1) Eliminate 

drafting errors and ambiguity; (2) write 

regulations to minimize litigation; and 

(3) provide a clear legal standard for 

affected conduct rather than a general 

standard and promote simplification 

and burden reduction. 61 FR 4729 

(February 7, 1996). Section 3(b) of 

Executive Order 12988 specifically 

requires that Executive agencies make 

every reasonable effort to ensure that the 

regulation: (1) Clearly specifies the 

preemptive effect, if any; (2) clearly 

specifies any effect on existing Federal 

law or regulation; (3) provides a clear 

legal standard for affected conduct 

while promoting simplification and 

burden reduction; (4) specifies the 

retroactive effect, if any; (5) adequately 

defines key terms; and (6) addresses 

other important issues affecting clarity 

and general draftsmanship under any 

guidelines issued by the Attorney 

General. Section 3(c) of Executive Order 

12988 requires Executive agencies to 

review regulations in light of applicable 

standards in section 3(a) and section 

3(b) to determine whether they are met 

or it is unreasonable to meet one or 

more of them. DOE has completed the 

required review and determined that, to 

the extent permitted by law, this final 

rule meets the relevant standards of 

Executive Order 12988. 

G. Review Under the Unfunded 

Mandates Reform Act of 1995 

Title II of the Unfunded Mandates 

Reform Act of 1995 (UMRA) requires 

each Federal agency to assess the effects 

of Federal regulatory actions on State, 

local, and Tribal governments and the 

private sector. Public Law 104–4, sec. 

201 (codified at 2 U.S.C. 1531). For an 

amended regulatory action likely to 

result in a rule that may cause the 

expenditure by State, local, and Tribal 

governments, in the aggregate, or by the 

private sector of $100 million or more 

in any one year (adjusted annually for 

inflation), section 202 of UMRA requires 

a Federal agency to publish a written 

statement that estimates the resulting 

costs, benefits, and other effects on the 

national economy. (2 U.S.C. 1532(a), (b)) 

The UMRA also requires a Federal 

agency to develop an effective process 

to permit timely input by elected 

officers of State, local, and Tribal 

governments on a ‘‘significant 

intergovernmental mandate,’’ and 

requires an agency plan for giving notice 

and opportunity for timely input to 

potentially affected small governments 

before establishing any requirements 

that might significantly or uniquely 

affect small governments. On March 18, 

1997, DOE published a statement of 

policy on its process for 

intergovernmental consultation under 

UMRA. 62 FR 12820. DOE’s policy 

statement is also available at http://

energy.gov/gc/office-general-counsel. 

DOE has concluded that this final rule 

would likely require expenditures of 

$100 million or more on the private 

sector. Such expenditures may include: 

(1) Investment in research and 

development and in capital 

expenditures by commercial 

refrigeration equipment manufacturers 

in the years between the final rule and 

the compliance date for the new 

standards, and (2) incremental 

additional expenditures by consumers 

to purchase higher-efficiency 

commercial refrigeration equipment, 

starting at the compliance date for the 

applicable standard. 

Section 202 of UMRA authorizes a 

Federal agency to respond to the content 

requirements of UMRA in any other 

statement or analysis that accompanies 

the final rule. 2 U.S.C. 1532(c). The 

content requirements of section 202(b) 

of UMRA relevant to a private sector 

mandate substantially overlap the 

economic analysis requirements that 

apply under section 325(o) of EPCA and 

Executive Order 12866. The 

SUPPLEMENTARY INFORMATION section of 

the notice of final rulemaking and the 

‘‘Regulatory Impact Analysis’’ section of 

the TSD for this final rule respond to 

those requirements. 

Under section 205 of UMRA, the 

Department is obligated to identify and 

consider a reasonable number of 

regulatory alternatives before 

promulgating a rule for which a written 

statement under section 202 is required. 

2 U.S.C. 1535(a). DOE is required to 

select from those alternatives the most 

cost-effective and least burdensome 

alternative that achieves the objectives 

of the rule unless DOE publishes an 

explanation for doing otherwise, or the 

selection of such an alternative is 

inconsistent with law. As required by 42 

U.S.C. 6295(d), (f), and (o), 6313(e), and 

6316(a), today’s final rule would 

establish energy conservation standards 

for commercial refrigeration equipment 

that are designed to achieve the 

maximum improvement in energy 

efficiency that DOE has determined to 

be both technologically feasible and 

economically justified. A full discussion 

of the alternatives considered by DOE is 

presented in the ‘‘Regulatory Impact 

Analysis’’ chapter 17 of the TSD for 

today’s final rule. 

H. Review Under the Treasury and 

General Government Appropriations 

Act, 1999 

Section 654 of the Treasury and 

General Government Appropriations 

Act, 1999 (Pub. L. 105–277) requires 

Federal agencies to issue a Family 

Policymaking Assessment for any rule 

that may affect family well-being. This 

rule would not have any impact on the 

autonomy or integrity of the family as 

an institution. Accordingly, DOE has 

concluded that it is not necessary to 

prepare a Family Policymaking 

Assessment. 

I. Review Under Executive Order 12630 

DOE has determined, under Executive 

Order 12630, ‘‘Governmental Actions 

and Interference with Constitutionally 

Protected Property Rights’’ 53 FR 8859 

(March 18, 1988), that this regulation 

would not result in any takings that 

might require compensation under the 

Fifth Amendment to the U.S. 

Constitution. 

J. Review Under the Treasury and 

General Government Appropriations 

Act, 2001 

Section 515 of the Treasury and 

General Government Appropriations 

Act, 2001 (44 U.S.C. 3516, note) 

provides for Federal agencies to review 

most disseminations of information to 

the public under guidelines established 

by each agency pursuant to general 

guidelines issued by OMB. OMB’s 

guidelines were published at 67 FR 

8452 (February 22, 2002), and DOE’s 

guidelines were published at 67 FR 

62446 (October 7, 2002). DOE has 

reviewed today’s final rule under the 

OMB and DOE guidelines and has 

concluded that it is consistent with 

applicable policies in those guidelines. 

K. Review Under Executive Order 13211 

Executive Order 13211, ‘‘Actions 

Concerning Regulations That 

Significantly Affect Energy Supply, 

Distribution, or Use’’ 66 FR 28355 (May 

22, 2001), requires Federal agencies to 

prepare and submit to OIRA at OMB, a 

Statement of Energy Effects for any 

significant energy action. A ‘‘significant 

energy action’’ is defined as any action 

by an agency that promulgates or is 

expected to lead to promulgation of a 

final rule, and that: (1) Is a significant 

regulatory action under Executive Order 

12866, or any successor order; and (2) 

is likely to have a significant adverse 

effect on the supply, distribution, or use 

of energy, or (3) is designated by the 

Administrator of OIRA as a significant 

energy action. For any significant energy 

action, the agency must give a detailed 

statement of any adverse effects on 

energy supply, distribution, or use 

should the proposal be implemented, 

and of reasonable alternatives to the 

action and their expected benefits on 

energy supply, distribution, and use. 


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17816 Federal Register / Vol. 79, No. 60 / Friday, March 28, 2014 / Rules and Regulations 

DOE has concluded that today’s 

regulatory action, which sets forth 

energy conservation standards for 

commercial refrigeration equipment, is 

not a significant energy action because 

the amended standards are not likely to 

have a significant adverse effect on the 

supply, distribution, or use of energy, 

nor has it been designated as such by 

the Administrator at OIRA. Accordingly, 

DOE has not prepared a Statement of 

Energy Effects on the final rule. 

L. Review Under the Information 

Quality Bulletin for Peer Review 

On December 16, 2004, OMB, in 

consultation with the Office of Science 

and Technology Policy (OSTP), issued 

its Final Information Quality Bulletin 

for Peer Review (the Bulletin). 70 FR 

2664 (January 14, 2005). The Bulletin 

establishes that certain scientific 

information shall be peer reviewed by 

qualified specialists before it is 

disseminated by the Federal 

Government, including influential 

scientific information related to agency 

regulatory actions. The purpose of the 

bulletin is to enhance the quality and 

credibility of the Government’s 

scientific information. Under the 

Bulletin, the energy conservation 

standards rulemaking analyses are 

‘‘influential scientific information,’’ 

which the Bulletin defines as scientific 

information the agency reasonably can 

determine will have, or does have, a 

clear and substantial impact on 

important public policies or private 

sector decisions. 70 FR 2667. 

In response to OMB’s Bulletin, DOE 

conducted formal in-progress peer 

reviews of the energy conservation 

standards development process and 

analyses and has prepared a Peer 

Review Report pertaining to the energy 

conservation standards rulemaking 

analyses. Generation of this report 

involved a rigorous, formal, and 

documented evaluation using objective 

criteria and qualified and independent 

reviewers to make a judgment as to the 

technical/scientific/business merit, the 

actual or anticipated results, and the 

productivity and management 

effectiveness of programs and/or 

projects. The ‘‘Energy Conservation 

Standards Rulemaking Peer Review 

Report’’ dated February 2007 has been 

disseminated and is available at the 

following Web site: 

www1.eere.energy.gov/buildings/

appliance_standards/peer_review.html. 

M. Congressional Notification 

As required by 5 U.S.C. 801, DOE will 

report to Congress on the promulgation 

of this rule prior to its effective date. 

The report will state that it has been 

determined that the rule is not a ‘‘major 

rule’’ as defined by 5 U.S.C. 804(2). 

VII. Approval of the Office of the 

Secretary 

The Secretary of Energy has approved 

publication of today’s final rule. 

List of Subjects in 10 CFR Part 431 

Administrative practice and 

procedure, Confidential business 

information, Energy conservation, 

Incorporation by reference, Reporting 

and recordkeeping requirements. 

Issued in Washington, DC, on February 28, 

2014. 

David T. Danielson, 

Assistant Secretary, Energy Efficiency and 

Renewable Energy. 

For the reasons stated in the 

preamble, DOE amends part 431 of 

chapter II, subchapter D, of title 10 of 

the Code of Federal Regulations, to read 

as set forth below: 

PART 431—ENERGY EFFICIENCY 

PROGRAM FOR CERTAIN 

COMMERCIAL AND INDUSTRIAL 

EQUIPMENT 

■ 1. The authority citation for part 431 

continues to read as follows: 

Authority: 42 U.S.C. 6291–6317. 

■ 2. Section 431.62 is amended by 

adding in alphabetical order a definition 

for ‘‘Service over counter’’ to read as 

follows: 

§ 431.62 Definitions concerning 

commercial refrigerators, freezers and 

refrigerator-freezers. 

* * * * * 

Service over counter means 

equipment that has sliding or hinged 

doors in the back intended for use by 

sales personnel, with glass or other 

transparent material in the front for 

displaying merchandise, and that has a 

height not greater than 66 inches and is 

intended to serve as a counter for 

transactions between sales personnel 

and customers. ‘‘Service over the 

counter, self-contained, medium 

temperature commercial refrigerator’’, 

also defined in this section, is one 

specific equipment class within the 

service over counter equipment family. 

* * * * * 

■ 3. Section 431.66 is amended by: 

■ a. Revising paragraph (a)(3); 

■ b. Revising paragraph (b)(1) 

introductory text; 

■ c. Revising paragraph (c); 

■ d. Revising paragraph (d) introductory 

text; and 

■ c. Adding paragraph (e). 

The revisions and addition read as 

follows: 

§ 431.66 Energy conservation standards 

and their effective dates. 

(a) * * * 

(3) For the purpose of paragraph (d) 

of this section, the term ‘‘TDA’’ means 

the total display area (ft2) of the case, as 

defined in ARI Standard 1200–2006, 

appendix D (incorporated by reference, 

see § 431.63). For the purpose of 

paragraph (e) of this section, the term 

‘‘TDA’’ means the total display area (ft2) 

of the case, as defined in AHRI Standard 

1200 (I–P)–2010, appendix D 

(incorporated by reference, see 

§ 431.63). 

(b)(1) Each commercial refrigerator, 

freezer, and refrigerator-freezer with a 

self-contained condensing unit designed 

for holding temperature applications 

manufactured on or after January 1, 

2010 and before March 27, 2017 shall 

have a daily energy consumption (in 

kilowatt-hours per day) that does not 

exceed the following: 

* * * * * 

(c) Each commercial refrigerator with 

a self-contained condensing unit 

designed for pull-down temperature 

applications and transparent doors 

manufactured on or after January 1, 

2010 and before March 27, 2017 shall 

have a daily energy consumption (in 

kilowatt-hours per day) of not more than 

0.126V + 3.51. 

(d) Each commercial refrigerator, 

freezer, and refrigerator-freezer with a 

self-contained condensing unit and 

without doors; commercial refrigerator, 

freezer, and refrigerator-freezer with a 

remote condensing unit; and 

commercial ice-cream freezer 

manufactured on or after January 1, 

2012 and before March 27, 2017 shall 

have a daily energy consumption (in 

kilowatt-hours per day) that does not 

exceed the levels specified: 

* * * * * 

(e) Each commercial refrigerator, 

freezer, and refrigerator-freezer with a 

self-contained condensing unit designed 

for holding temperature applications 

and with solid or transparent doors; 

commercial refrigerator with a selfcontained condensing unit designed for 

pull-down temperature applications and 

with transparent doors; commercial 

refrigerator, freezer, and refrigeratorfreezer with a self-contained condensing 

unit and without doors; commercial 

refrigerator, freezer, and refrigeratorfreezer with a remote condensing unit; 

and commercial ice-cream freezer 

manufactured on or after March 27, 

2017, shall have a daily energy 

consumption (in kilowatt-hours per day) 

that does not exceed the levels 

specified: 


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Federal Register / Vol. 79, No. 60 / Friday, March 28, 2014 / Rules and Regulations 17817 

(1) For equipment other than hybrid 

equipment, refrigerator/freezers, or 

wedge cases: 

Equipment category 

Condensing 

unit 

configuration 

Equipment 

family 

Rating 

temp. 

°F 

Operating 

temp. 

°F 

Equipment 

class 

designation * 

Maximum 

daily energy 

consumption 

kWh/day 

Remote Condensing 

Commercial Refrigerators and Commercial Freezers.

Remote (RC) .............. Vertical Open (VOP) ... 38 (M) ≥32 VOP.RC.M .. 0.64 × TDA + 4.07. 

0 (L) <32 VOP.RC.L ... 2.2 × TDA + 6.85. 

Semivertical Open 

(SVO).

38 (M) ≥32 SVO.RC.M .. 0.66 × TDA + 3.18. 

0 (L) <32 SVO.RC.L ... 2.2 × TDA + 6.85. 

Horizontal Open (HZO) 38 (M) ≥32 HZO.RC.M .. 0.35 × TDA + 2.88. 

0 (L) <32 HZO.RC.L ... 0.55 × TDA + 6.88. 

Vertical Closed Transparent (VCT).38 (M) ≥32 VCT.RC.M ... 0.15 × TDA + 1.95. 

0 (L) <32 VCT.RC.L .... 0.49 × TDA + 2.61. 

Horizontal Closed 

Transparent (HCT).

38 (M) ≥32 HCT.RC.M ... 0.16 × TDA + 0.13. 

0 (L) <32 HCT.RC.L .... 0.34 × TDA + 0.26. 

Vertical Closed Solid 

(VCS).

38 (M) ≥32 VCS.RC.M ... 0.1 × V + 0.26. 

0 (L) <32 VCS.RC.L .... 0.21 × V + 0.54. 

Horizontal Closed 

Solid (HCS).

38 (M) ≥32 HCS.RC.M .. 0.1 × V + 0.26. 

0 (L) <32 HCS.RC.L ... 0.21 × V + 0.54. 

Service Over Counter 

(SOC).

38 (M) ≥32 SOC.RC.M .. 0.44 × TDA + 0.11. 

0 (L) <32 SOC.RC.L ... 0.93 × TDA + 0.22. 

Self-Contained Commercial Refrigerators 

and Commercial 

Freezers Without 

Doors.

Self-Contained (SC) ... Vertical Open (VOP) ... 38 (M) ≥32 VOP.SC.M ... 1.69 × TDA + 4.71. 

0 (L) <32 VOP.SC.L ... 4.25 × TDA + 11.82. 

Semivertical Open 

(SVO).

38 (M) ≥32 SVO.SC.M ... 1.7 × TDA + 4.59. 

0 (L) <32 SVO.SC.L ... 4.26 × TDA + 11.51. 

Horizontal Open (HZO) 38 (M) ≥32 HZO.SC.M ... 0.72 × TDA + 5.55. 

0 (L) <32 HZO.SC.L .... 1.9 × TDA + 7.08. 

Self-Contained Commercial Refrigerators 

and Commercial 

Freezers With Doors.

Self-Contained (SC) ... Vertical Closed Transparent (VCT).38 (M) ≥32 VCT.SC.M ... 0.1 × V + 0.86. 

0 (L) <32 VCT.SC.L .... 0.29 × V + 2.95. 

Vertical Closed Solid 

(VCS).

38 (M) ≥32 VCS.SC.M ... 0.05 × V + 1.36. 

<32 VCS.SC.L .... 0.22 × V + 1.38. 

Horizontal Closed 

Transparent (HCT).

38 (M) ≥32 HCT.SC.M ... 0.06 × V + 0.37. 

0 (L) <32 HCT.SC.L .... 0.08 × V + 1.23. 

Horizontal Closed 

Solid (HCS).

≥32 HCS.SC.M ... 0.05 × V + 0.91. 

0 (L) <32 HCS.SC.L .... 0.06 × V + 1.12. 

Service Over Counter 

(SOC).

≥32 SOC.SC.M .. 0.52 × TDA + 1. 

0 (L) <32 SOC.SC.L ... 1.1 × TDA + 2.1. 

Self-Contained Commercial Refrigerators 

with Transparent 

Doors for Pull-Down 

Temperature Applications.

Self-Contained (SC) ... Pull-Down (PD) ........... 38 (M) ≥32 PD.SC.M ..... 0.11 × V + 0.81. 

Commercial Ice-Cream 

Freezers.

Remote (RC) .............. Vertical Open (VOP) ... ¥15 (I) ≤¥5** VOP.RC.I .... 2.79 × TDA + 8.7. 

Semivertical Open 

(SVO).

SVO.RC.I .... 2.79 × TDA + 8.7. 

Horizontal Open (HZO) HZO.RC.I .... 0.7 × TDA + 8.74. 

Vertical Closed Transparent (VCT).VCT.RC.I ..... 0.58 × TDA + 3.05. 


tkelley on DSK3SPTVN1PROD with RULES2
17818 Federal Register / Vol. 79, No. 60 / Friday, March 28, 2014 / Rules and Regulations 

Equipment category 

Condensing 

unit 

configuration 

Equipment 

family 

Rating 

temp. 

°F 

Operating 

temp. 

°F 

Equipment 

class 

designation * 

Maximum 

daily energy 

consumption 

kWh/day 

Horizontal Closed 

Transparent (HCT).

HCT.RC.I ..... 0.4 × TDA + 0.31. 

Vertical Closed Solid 

(VCS).

VCS.RC.I ..... 0.25 × V + 0.63. 

Horizontal Closed 

Solid (HCS).

HCS.RC.I .... 0.25 × V + 0.63. 

Service Over Counter 

(SOC).

SOC.RC.I .... 1.09 × TDA + 0.26. 

Self-Contained (SC) ... Vertical Open (VOP) ... VOP.SC.I ..... 5.4 × TDA + 15.02. 

Semivertical Open 

(SVO).

SVO.SC.I ..... 5.41 × TDA + 14.63. 

Horizontal Open (HZO) HZO.SC.I ..... 2.42 × TDA + 9. 

Vertical Closed Transparent (VCT).VCT.SC.I ..... 0.62 × TDA + 3.29. 

Horizontal Closed 

Transparent (HCT).

HCT.SC.I ..... 0.56 × TDA + 0.43. 

Vertical Closed Solid 

(VCS).

VCS.SC.I ..... 0.34 × V + 0.88. 

Horizontal Closed 

Solid (HCS).

HCS.SC.I ..... 0.34 × V + 0.88. 

Service Over Counter 

(SOC).

SOC.SC.I .... 1.53 × TDA + 0.36. 

* The meaning of the letters in this column is indicated in the columns to the left. 

** Ice-cream freezer is defined in 10 CFR 431.62 as a commercial freezer that is designed to operate at or below ¥5 °F *(¥21 °C) and that 

the manufacturer designs, markets, or intends for the storing, displaying, or dispensing of ice cream. 

(2) For commercial refrigeration 

equipment with two or more 

compartments (i.e., hybrid refrigerators, 

hybrid freezers, hybrid refrigeratorfreezers, and non-hybrid refrigeratorfreezers), the maximum daily energy 

consumption for each model shall be 

the sum of the MDEC values for all of 

its compartments. For each 

compartment, measure the TDA or 

volume of that compartment, and 

determine the appropriate equipment 

class based on that compartment’s 

equipment family, condensing unit 

configuration, and designed operating 

temperature. The MDEC limit for each 

compartment shall be the calculated 

value obtained by entering that 

compartment’s TDA or volume into the 

standard equation in paragraph (e)(1) of 

this section for that compartment’s 

equipment class. Measure the CDEC or 

TDEC for the entire case as described in 

§ 431.66(d)(2)(i) through (iii), except 

that where measurements and 

calculations reference ARI Standard 

1200–2006 (incorporated by reference, 

see § 431.63), AHRI Standard 1200 (I– 

P)–2010 (incorporated by reference, see 

§ 431.63) shall be used. 

(3) For remote condensing and selfcontained wedge cases, measure the 

CDEC or TDEC according to the AHRI 

Standard 1200 (I–P)–2010 test 

procedure (incorporated by reference, 

see § 431.63). For wedge cases in 

equipment classes for which a volume 

metric is used, the MDEC shall be the 

amount derived from the appropriate 

standards equation in paragraph (e)(1) of 

this section. For wedge cases of 

equipment classes for which a TDA 

metric is used, the MDEC for each 

model shall be the amount derived by 

incorporating into the standards 

equation in paragraph (e)(1) of this 

section for the equipment class a value 

for the TDA that is the product of: 

(i) The vertical height of the air 

curtain (or glass in a transparent door) 

and 

(ii) The largest overall width of the 

case, when viewed from the front. 

[FR Doc. 2014–05082 Filed 3–27–14; 8:45 am] 

BILLING CODE 6450–01–P 


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