UNITED STATES OF AMERICA 

 DEPARTMENT OF ENERGY 

 PUBLIC MEETING ON ENERGY CONSERVATION STANDARDS 

PROPOSED RULEMAKING FOR DISTRIBUTION TRANSFORMERS 

 

 

U.S. Department of Energy 

1000 Independence Ave., SW 

Washington, D.C. 20585 

 Room 8E-089 Review Center 

 

 Thursday 

February 23, 2012 

 

Facilitator: 

Doug Brookman 

Public Solutions 

Baltimore, MD 
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Participants Identified: 

Andrew deLaski 

Appliance Standards Awareness Project 

Charlie Stephens 

Northwest Energy Efficiency Alliance 

Timothy Ballo 

Earth Justice 

Bruce Hirsh 

Baltimore Gas and Electric 

John Caskey 

National Electrical Manufacturers Association 

Ray Polinski 

ATI-Allegheny Ludlum 

Bob Saint 

National Rural Electric Cooperative Association 

Michael Hyland 

American Public Power Association 

Greg Coulter 

Consultant for PROLEC GE International 

John Phouminh 

Pepco Holdings, Inc. 

Casey Ballard 

ABB Inc. 

Jerry Corkran 

Cooper Power Systems 

Philip Hopkinson 

HVOLT, Inc. 

Robin Roy 

Natural Resources Defense Council 

Gerald Hodge 

Howard Industries, Inc. 

Steve Rosenstock 

Edison Electric Institute 

Eric Petersen 
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AK Steel Corporation 

Ned Brush 

Consultant 

Wes Patterson 

Consultant - Navigant 

Robert Berman 

Berman Economics 

Paul Ryan 

Hitachi Metals America, Ltd. 

Jim Creevy 

National Electrical Manufacturers Association 

Carl Bush 

PEMCO Corporation 

Jamie Bishop 

Allegheny Technologies 

James Rakowski 

ATI-Allegheny Ludlum 

Alex Hoffman 

American Public Power Association 

Alan McCoy 

AK Steel Corporation 

 

Chuck Foster 

Edison Electric Institute 

Donald Junta 

U.S. Department of Agriculture 

Ned Brush 

BBF & Associates 

Richard Parker 

University of Connecticut 

Kevin Looby 

Lakeview Metals, Inc. 

Alex Bosenberg 

National Electrical Manufacturers Association 

Kenneth Winder 
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Moon Lake Electric Association, Inc. 

Zolaikha Strong 

Copper Development Association 

Eric Petersen 

AK Steel Corporation 

Barry Racey 

AK Steel Corporation 

Jeffrey Petrich 

Ernst & Young 

Ismael Leon 

Prolec GE International 

Participants from the Department of Energy:

John Cymbalsky 

Appliance Standards Program 

Ami Grace-Tardy 

Office of the General Counsel 

James Raba 

Project Manager 

Brenda Edwards 

Program Support Specialist 

 

Participants from Consultants:

Christopher Bolduc 

Lawrence Berkeley National Laboratory 

Katie Coughlin 

Lawrence Berkeley National Laboratory 

Matthew Nardotti 

Navigant Consulting 

Robert Carmichael 

Navigant Consulting 
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Brian Coffey 

Navigant Consulting 

Michael Rivest 

Navigant Consulting 

Pamela Costello 

Navigant Consulting 

Caitlin Johnson 

Navigant Consulting 

Zhimei Luo 

Navigant Consulting 

Presenters:

Brian Coffey 

Navigant Consulting 

Christopher Bolduc 

Lawrence Berkeley National Laboratory 

 
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AGENDA

 ITEM PAGE 

Welcome, Mr. Brookman 6 

Welcome for DOE, Mr. Raba 6 

Introductions 7 

Agenda Review, Mr. Brookman 10 

Introductory Remarks, Mr. Raba 13 

Opening Remarks 16 

Rulemaking History, Schedule, Scope 

Negotiated Rulemaking Process 

 Mr. Coffey 51 

EPCA Factors, Scope, Definitions, Test 

Procedure, Equipment Classes 

 Mr. Coffey 61 

Engineering Analysis, Mr. Coffey 79 

Markups, Loading, Distribution Channels 

 Ms. Coughlin 96 

Life Cycle Cost Analysis, Payback-Period 

Analysis, Ms. Coughlin 108 

Shipments, National Impact Analysis, 

Refurbishments 

 Ms. Coughlin 113 

Trial Standard Levels, Proposed Standards 

 Mr. Bolduc 128 

Discussion of Proposed Standards 155 

Closing Remarks, Mr. Raba 178 
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1 P R O C E E D I N G S

2 MR. BROOKMAN: Let’s get started. Please 

3 take your seats. Good morning everyone and welcome. 

4 This is the U.S. Department of Energy’s public 

5 meeting on Energy Conservation Standards Proposed 

6 Rulemaking for Distribution Transformers. Today is 

7 Thursday, February 23, 2012, here in the Forrestal 

8 Building in Washington, D.C. My name is Doug 

9 Brookman from Public Solutions in Baltimore. So glad 

10 to see you this morning. Glad you were able to make 

11 it here on time for an early start on the day. 

12 I’m going to turn it over first thing this 

13 morning to Jim Raba for welcoming remarks. 

14 Welcoming Remarks 

15 MR. RABA: Good morning, and welcome to 

16 the Department of Energy today. I’m Jim Raba. This 

17 is our public meeting on the proposed rule for 

18 distribution transformers. Today to present the 

19 results of the Department of Energy’s analyses of 

20 energy efficiency standards for distribution 

21 transformers thus far, but mostly we want to hear 

22 from you, your comments and recommendations, data, 

23 and information. 

24 But nevertheless we have a lot of things 

25 to cover in today’s agenda, so before I go too far, 
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1 I’ll turn it back to Doug. Welcome, thank you for 

2 being here and participating right along from the 

3 beginning. We’ll have more. Thank you. 

4 MR. BROOKMAN: We typically start off with 

5 introductions around the room. I’m going to start 

6 to my left. You can get used to turning the 

7 microphones on and off. For those of you seated at 

8 table, the little green lights have to come on. 

9 Please say your name, and organizational 

10 affiliation. 

11 Introductions 

12 MR. HIRSCH: Bruce Hirsh, Baltimore Gas 

13 and Electric. 

14 MR. BROOKMAN: Thank you. 

15 MR. CASKEY: John Caskey, NEMA. 

16 MR. POLINSKI: Ray Polinski, ATI-Allegheny 

17 Ludlum. 

18 MR. SAINT: Bob Saint, National Rural 

19 Electric Cooperative Association. 

20 MR. HYLAND: Mike Hyland, the American 

21 Public Power Association. 

22 MR. COULTER: Greg Coulter, Consultant for 

23 Prolec-GE. 

24 MR. PHOUMINH: John Phouminh, PEPCO 

25 Holding, Inc. 

26 MR. BALLARD: Casey Ballard, ABB. 

27 MR. CORKRAN: Jerry Corkran, Cooper Power. 

28 MR. HOPINSON: Phil Hopkinson, HVOLT, Inc. 
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1 MR. deLaski: Andrew deLaski, Appliance 

2 Standards Awareness Project. 

3 MR. ROY: Robin Roy, Natural Resources 

4 Defense Council. 

5 MR. HODGE: Jerry Hodge from Howard 

6 Industry. 

7 MR. ROSENSTOCK: Steve Rosenstock, Edison 

8 Electric Institute. 

9 MR. PETERSEN: Eric Petersen, AK Steel 

10 Corporation. 

11 MS. GRACE-TARDY: Ami Grace-Tardy, 

12 Department of Energy, General Counsel’s office. 

13 MR. CYMBALSKY: John Cymbalsky, DOE. 

14 MR. RABA: Jim Raba, DOE. 

15 MR. LOOBY: Kevin Looby, Lakeview Metals. 

16 MR. BROOKMAN: Let’s start over here. 

17 Please stand up and say your name. 

18 MR. BOLDUC: Christopher Bolduc, LBL. 

19 MS. COUGHLIN: Katie Coughlin, Lawrence 

20 Berkeley Lab. 

21 MR. NARDOTTI: Matt Nardotti, Navigant. 

22 MR. CARMICHAEL: Rob Carmichael, Navigant. 

23 MR. COFFEY: Brian Coffey, Navigant. 

24 MS. EDWARDS: Brenda Edwards, DOE. 

25 MR. BROOKMAN: Please. 

26 MS. BRUSH: Ned Brush, Consultant. 

27 MS. STRONG: Zolaikha Strong, Copper 

28 Development Association. 
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1 MR. PATTERSON: Wes Patterson, Consultant 

2 for Navigant. 

3 MR. BERMAN: Robert Berman, Berman 

4 Economics. 

5 MR. RYAN: Paul Ryan, Hitachi Metglas. 

6 MR. CREEVY: Jim Creevy, NEMA. 

7 MR. BOSENBERG: Alex Bosenberg, NEMA. 

8 MR. BALLO: Tim Ballo, Earth Justice. 

9 MR. FOSTER: Chuck Foster, Counsel for EEI 

10 MR. BUSH: Carl Bush, PEMCO Corporation. 

11 MS. BISHOP: Jamie Bishop, ATI. 

12 MR. RAKOWSKI: Jim Rakowski, ATI. 

13 MR. HOFFMAN: Alex Hoffman, American 

14 Public Power Association. 

15 MR. RACEY: Barry Racey, AK Steel 

16 Corporation. 

17 MR. McCOY: Al McCoy, representing AK 

18 Steel. 

19 MR. STEPHENS: Charlie Stephens, Northwest 

20 Energy Efficiency Alliance. 

21 MR. BROOKMAN: Thank you. Thanks again 

22 for all of your for being here this morning. We 

23 should also acknowledge and welcome those that have 

24 joined us via the web. We have thirty-odd 

25 participants via the web today, so that’s a goodly 

26 number of folks. 

27 All of you received a packet of 

28 information as you came in the door. I’m going to 
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1 refer to that packet. There’s an agenda. There are 

2 some written statements. There is a slide deck 

3 which will be the basis for discussion and 

4 presentation as the day goes on here, and also the 

5 Federal Register notice. 

6 Agenda Review

7 MR. BROOKMAN: Start with the agenda 

8 first. Immediately following this agenda review, 

9 there’s an opportunity for anybody that wishes to do 

10 so to make opening statements, brief comments, 

11 hopefully fairly brief about the issues that matter 

12 to you, what you’d like to see focused on today from 

13 your perspective. 

14 Immediately following that, we’re going to 

15 talk – get a presentation and an opportunity for 

16 discussion on rulemaking history, schedule, scope 

17 and the negotiated rulemaking process. From there, a 

18 description of the EPCA factors, scope definitions, 

19 test procedure, equipment classes. Immediately 

20 following that, engineering analysis. 

21 We’ll take a coffee break round about 

22 10:15 or so this morning, and following the coffee 

23 break, a description, lots of opportunity for 

24 discussion on markups, loading, distribution 

25 channels, life-cycle cost and payback-period 

26 analysis, national impact analysis, refurbishments. 

27 Then trial standard levels and proposed standards, 

28 discussion of proposed standards 
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1 And the schedule as listed here in the 

2 agenda is that we’re going to finish today at 12:45. 

3 I think no one wishes to truncate the opportunity 

4 for comment and discussion. We’ll go efficiently 

5 and rapidly forward, we’ll just see how long it 

6 takes for us to do this. If we get to 12 or so, or 

7 12:30 and we still have a fair piece to go, we’ll 

8 pause for lunch. Then we’ll return and keep at it. 

9 Any questions or comments about the 

10 agenda? I see none at this point. 

11 I’d ask for your consideration. Many of 

12 you are familiar with this process. Please speak 

13 one at a time. You’re going to have to turn on the 

14 microphone each time you speak. Please say your 

15 name for the record each time you speak. I’m going 

16 to be cuing individuals by name as best I can, so 

17 you know who’s in the queue. I also wish to 

18 encourage follow-on comments. The back and forth 

19 between individuals is sometimes very helpful to the 

20 Department as it is sorting through what to do with 

21 all this commentary. 

22 Please keep the focus here. Turn your 

23 cell phones on silent mode if you would, please, and 

24 limit the sidebar conversations. If you can try to 

25 be concise, there’s certainly a lot to be said. 

26 Having read the PowerPoint slides last night, 

27 there’s a lot of content here. So let’s see if we 

28 can keep it focused there. And I must say, if we’re 
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1 disciplined in the conduct of the discussion today 

2 as we were with the introductions, then that bodes 

3 well for all of us, I think. 

4 So I turn it back then to – do you want to 

5 do opening statements first, or do you want to do 

6 some additional introductory slides? 

7 MR. RABA: Introductory slides. 

8 MR. BROOKMAN: Introductory slides – 

9 yours? 

10 MR. RABA: Yeah. 

11 MR. BROOKMAN: Okay. 

12 

13 Introductory Remarks 

14 MR. RABA: Good morning again. Jim Raba, 

15 Project Manager, distribution transformers proposed 

16 rule and rulemaking. A lot of familiar faces. It’s 

17 good. Hope these are friendly faces, as they say. 

18 You’re certainly familiar and thank you for being 

19 here today. 

20 Today, as I said before, we’re going to 

21 present the results of the Department of Energy’s 

22 analyses of energy efficiency standards for 

23 distribution transformers thus far as a proposed 

24 rule. More so, we want to hear from you and to 

25 encourage discussion of any issues surrounding this 

26 rulemaking. Also we encourage your comments, 

27 information and data as we look to a final rule by 

28 October of this year. Wriiten comment period for 
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this proposed-rule phase closes April 10th 1 . 

2 I mentioned issues. Today we’re 

3 highlighting issues of interest with comment boxes 

4 like these throughout today’s presentation. And 

5 there are various ways to submit comments: email, 

6 postal, hand delivery by courier, and the like. 

7 Flashback to the Energy Policy Act of 

8 2005, EPACT started all the ball rolling. October 

9 2007, DOE issued a final rule establishing standards 

10 for liquid-immersed and medium-voltage dry-type 

11 distribution transformers. But, the Department was 

12 ordered to reconsider. So, the Department agreed to 

13 an expedited timeline whether to amend standards for 

14 liquid-immersed and medium-voltage dry-type 

15 distribution transformers, and low-voltage 

16 distribution transformers were included with that. 

17 So here we are today. This has been a 

18 unique rulemaking and a first for DOE. Let me show 

19 you. Here’s the classic timeline, and here we are 

20 today. You can see it started out back in July, end 

21 of July 2011, and now we’re at the NOPR stage there 

22 at the beginning of this year. So in July 2011, DOE 

23 issued a Notice of Intent to negotiate a proposed 

24 rule. And you know the rest. The comments, data, 

25 information exchanged in good faith by all 

26 interested parties was awesome. 

27 DOE established two subcommittees, one for 

28 liquid-immersed and medium-voltage distribution 
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1 transformers, and one for low-voltage distribution 

2 transformers, and these included, both included 

3 manufacturers of transformers, steel, utilities, 

4 energy efficiency advocacy groups, trade 

5 associations, and other interested parties. 

6 Now the medium-voltage and liquid-immersed 

7 distribution transformers committee reached 

8 consensus on standards for medium-voltage dry-type, 

9 but the committee was unable to reach consensus on 

10 liquid-immersed and low-voltage dry-type. So 

11 notwithstanding, I believe we all agree that the 

12 process was the best part. Congratulations and 

13 thanks to all of you that made it happen. Special 

14 kudos to the experts from Lawrence Berkeley National 

15 Laboratory and Navigant Consulting Incorporated, and 

16 our facilitator, Richard Parker at the time, that 

17 did virtually 24/7 work for all you and for today’s 

18 proposed rule. So, in Doug Brookman’s style, give 

19 yourselves a round of applause. Well done. 

20 (Applause.) 

21 So here we are. We’re looking at the, 

22 again, at the essential seven: economic impact, 

23 operating cost savings, projected energy savings, 

24 performance, competition, national energy 

25 conservation, and other factors. So, we’ll then 

26 proceed then to look forward now in this proposed 

27 rulemaking phase and introduce then Brian Coffey who 

28 will continue from Navigant Consulting. 
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1 MR. BROOKMAN: We did still want to take 

2 opening remarks here at the outset. 

3 MR. RABA: Okay. Still. Forgive me, 

4 thank you. We invite you, we want to hear from you, 

5 any opening remarks. We know there’s some people, 

6 persons of interest here who like to make statements 

7 for the record, so raise your hand and Doug will 

8 recognize you. 

9 MR. BROOKMAN: Brief opening remarks. 

10 Yes, please Ray. 

11 Opening Statements 

12 MR. POLINSKI: Ray Polinski from ATI13 Allegheny Ludlum, and just want to read a prepared 

14 statement. ATI-Allegheny Ludlum fully supports the 

15 Department of Energy’s preliminary ruling regarding 

16 more-stringent efficiency standards for distribution 

17 transformers. The DOE fully utilized the expert 

18 technical and manufacturing input from the 

19 negotiated rulemaking process in arriving at this 

20 decision. This results in higher standards for 

21 transformers with mandated efficiencies typically 

22 exceeding 99 percent, which ranks among the highest 

23 in the world. At the same time, the standard 

24 protects thousands of U.S. manufacturing jobs. 

25 The new efficiency standards maintain a 

26 competitive balance between grain-oriented 

27 electrical steel transformer cores and long-standing 

28 alternative materials. Grain-oriented electrical 
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1 steel is an advanced, highly engineered material 

2 that uses nano-scale technology to produce a steel 

3 that is nearly a perfect single crystal throughout. 

4 This yields excellent electrical efficiency 

5 properties when properly designed into a transformer 

6 core. Grain-oriented electrical steel manufacturing 

7 is carried out economically on a mass-production 

8 basis with global production surpassing two million 

9 metric tons annually from a multitude of producers. 

10 These factors ensure adequate supply for all 

11 manufacturers of distribution transformers and 

12 vigorous competition on price. 

13 More radical increases in mandatory 

14 efficiency would result in the wholesale replacement 

15 of grain-oriented electrical steel with a core 

16 material that is manufactured on a very limited 

17 basis relative to the size of the U.S. distribution 

18 transformer market, by a single foreign-owned 

19 company that currently exports much of its 

20 production. Regulation resulting in a monopoly 

21 position for core materials is likely to result in 

22 uncontrolled price increases and supply shortfalls, 

23 particularly for small manufacturers of distribution 

24 transformers, and is likely that transformer prices 

25 will increase rapidly in such environment. This 

26 cost would invariably be passed on to consumers of 

27 electricity. 

28 A scenario where grain-oriented electrical 
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1 steel is not available as a core material option 

2 would damage the dwindling manufacturing base in the 

3 U.S. and could result in a long-term situation where 

4 no domestically owned company would produce the 

5 strategically important material for transformers 

6 that are the critical link in the U.S. electrical 

7 grid. 

8 Ongoing investment to improve grain9 oriented electrical steel efficiencies, while 

10 alternative core material options – excuse me. 

11 Ongoing investment used to improve GOES [grain12 oriented electrical steel] efficiencies while 

13 alternative core material options that have been 

14 produced for over 30 years also remain available. 

15 The DOE has arrived at a well-balanced 

16 update to the distribution transformer efficiency 

17 standard that results in significant additional 

18 energy savings, is environmentally responsible, 

19 maintains the domestic manufacturing base for core 

20 materials and meets America’s current and future 

21 needs for electrical energy conservation, cost 

22 effective delivery, and stability of supply. 

23 Thank you. 

24 MR. BROOKMAN: Thank you. I think all of 

25 you received a copy of that opening statement from 

26 Ray in your packet. Additional, and hopefully brief, 

27 opening statements. Yes, Phil. 

28 MR. HOPKINSON: Phil Hopkinson, HVOLT, 
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1 Inc. I’m not going to read the letter that I 

2 submitted – 

3 MR. BROOKMAN: Which is in the record. 

4 MR. HOPKINSON: -- which is in the record, 

5 but I would do something that I find that I like to 

6 do, which is to compliment those who deserve it when 

7 they do deserve it, and certainly to pick on those 

8 when I think that they don’t deserve it. But in 

9 this particular case, I have to say that I am 

10 extremely pleased with the NOPR as it is submitted 

11 and as we are addressing it today. I think that 

12 there are benefits that come through to certainly 

13 energy savings, and as some of my colleagues have 

14 calculated, they’ve concluded that in liquid-filled 

15 transformers, there is more than a 41 percent 

16 reduction in loss over the low first-cost design as 

17 a result of this NOPR, which is quite a change over 

18 what it had been back before we started to regulate 

19 distribution transformer energy efficiency. 

20 So I think that the result of improved 

21 losses is clearly there. I think also that the 

22 ability to use multiple steels, including M3, which 

23 has become quite a workhorse to the industry, as 

24 well as amorphous core, which also is an evolving 

25 technology and material and is starting to take on 

26 wider use. Both materials are capable of being 

27 used, and I think that that part is good as well. 

28 And I think that it keeps the small manufacturers in 
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1 business, which is something that I personally have 

2 worked hard to try to achieve in this process, and 

3 I’ve been fortunate to do work for Navigant and 

4 certainly my DOE friends as well as many of the 

5 manufacturers. So I have to conclude that just 

6 excellent work, and of course, Richard Parker, I 

7 thought, did a wonderful job also in the process. 

8 So that’s heartfelt and not read, but I 

9 think that’s what I believe. 

10 MR. BROOKMAN: Okay. Thank you. 

11 Additional comments here at the outset. It is John, 

12 is it? 

13 MR. CASKEY: Yes. John Caskey, NEMA. I 

14 did prepare some remarks and sent them to Jim. I’m 

15 not sure if you got them or not for the record. 

16 MR. RABA: I’ve not received them yet, but 

17 they will go into the record. 

18 MR. CASKEY: Okay. So I’ll get you the 

19 more official version, but I’ll just read this very 

20 quickly, a part of it. NEMA would like to thank the 

21 Department of Energy and its staff for providing 

22 NEMA and other stakeholders the opportunity to 

23 participate in the innovative negotiated rulemaking 

24 process for energy conservation standards for 

25 distribution transformers. From NEMA’s perspective, 

26 this process has been extremely valuable in helping 

27 all the stakeholders understand the interest and 

28 concerns of the other stakeholders. In addition, it 
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1 provided an opportunity for the transformer and 

2 steel manufacturers to explain existing technologies 

3 and markets, and for the Department’s consultants to 

4 refine the various models and input assumptions used 

5 in the analysis. 

6 From NEMA’s perspective, the energy 

7 efficiency levels presented in the NOPR represent 

8 the highest level of energy savings that are 

9 economically justified and maintain a healthy 

10 transformer industry in the United States. Going 

11 beyond the proposed levels will disrupt the steel 

12 and transformer industries in the U.S. Further, we 

13 are concerned that transformer efficiency levels 

14 higher than what are contained in the NOPR could 

15 lead some utilities to rebuild old transformers in 

16 place of buying new, high efficient transformers, 

17 which would be counter-productive to the objective 

18 of greater energy efficiency. 

19 In short, NEMA strongly recommends that 

20 the DOE adopt the efficiency levels stated in the 

21 NOPR, because we believe these are the highest 

22 efficiency levels that are economically justified 

23 and support a healthy utility, steel, and 

24 transformer industries in the United States. Thank 

25 you. 

26 MR. BROOKMAN: Thank you. Other comments 

27 here at the outset? Jerry. 

28 MR. CORKRAN: Jerry Corkran, Cooper Power 
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1 Systems. I also have a letter in the information. 

2 I won’t read the whole letter, but the key sentence 

3 in it is that Cooper considers the proposed ruling 

4 the best choice for the distribution transformer 

5 industry and for the American people who will 

6 receive more efficient transformers in a cost7 justifiable manner. 

8 MR. BROOKMAN: Thank you very much. Yes, 

9 please. 

10 MR. COULTER: Greg. Greg Coulter, Prolec11 GE. I have a short statement. Prolec-GE would like 

12 to thank you for the opportunity to attend this 

13 public hearing and to offer our perspective on the 

14 proposed rule as it relates to medium-voltage 

15 liquid-immersed distribution transformers. It would 

16 also like to thank the Department for allowing us to 

17 participate in the recently concluded negotiated 

18 rulemaking sessions. 

19 Although we were disappointed the process 

20 did not result in a negotiated agreement for liquid21 immersed distribution transformers, we feel it did 

22 provide a critical venue for concerned parties to 

23 communicate their perspectives and positions that we 

24 believe has enhanced and resulted in the proposed 

25 rule. 

26 In the negotiation sessions we were party 

27 to and supported the NEMA proposal for liquid28 immersed distribution transformers, which we 
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1 believed provided significant energy savings while 

2 maintaining manufacturers’ ability to utilize a 

3 range of materials and sources to achieve those 

4 savings. We are pleased to see that the proposed 

5 rule is consistent with the NEMA proposal for 

6 improving efficiency levels while preserving the 

7 flexibility in materials and designs needed to serve 

8 the varied requirements of the customers. We 

9 commend the work of the Department and offer our 

10 support of the proposed rule. 

11 However, we remind the Department that 

12 NEMA position included provisions relating to 

13 special handling of covered products for specialized 

14 applications where physical constraints are an 

15 ongoing issue. Since GE also manufactures network 

16 and vault distribution transformers at our 

17 Shreveport, Louisiana location, we want to emphasize 

18 that many of our customers for these unique products 

19 have critical size, weight, and other physical 

20 performance limits that can conflict with changes in 

21 efficiency standards. 

22 Our written comments which will be 

23 provided to the Department will support the 

24 recommendations of the working group for networks 

25 and vaults established as part of the negotiated 

26 rulemaking activities. 

27 MR. BROOKMAN: Thank you. Other comments 

28 here at the outset. Andrew, do you have a comment? 
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1 MR. deLASKI: (off microphone comment) So 

2 actually, this is going to be a little lengthy, 

3 Doug, if you’ll forbear – 

4 MR. BROOKMAN: Who are you? (Laughter) 

5 MR. deLASKI: My name’s Andrew deLaski and 

6 I’m the Executive Director of the Appliance 

7 Standards Awareness Project. ASAP is a coalition 

8 project that is led by a steering committee that 

9 consists of consumer organizations, energy 

10 efficiency advocates, environmental organizations, a 

11 major public utility, and state government 

12 representatives. We are an organization that 

13 advocates for cost-effective energy efficiency 

14 standards across a range of products, and have been 

15 involved in DOE rulemaking processes for about the 

16 last 15 years. 
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1 In this opening statement I want to do 

2 five things: 

3  One is I want to correct the record with 

4 respect to the positions taken during the 

5 negotiation process; 

6  Secondly, I want to make some overall brief 

7 observations with respect to the selected 

8 levels for low-voltage dry-type transformers; 

9  Third, I want to make two specific 

10 recommendations for additional analysis 

11 that’s needed with respect to low-voltage 

12 dry-type transformers; 

13  Fourth, I’m going to shift from low-voltage 

14 dries to the medium-voltage liquid-immersed, 

15 and I’ll make some overall observations with 

16 respect to medium-voltage medium-voltage 

17 liquid-immersed transformers; 

18  And then close with three specific 

19 recommendations for additional analysis 

20 that’s needed with respect to medium-voltage 

21 liquid-immersed transformers. 

22 First of all, let me correct the record. 

23 If you look at page 2292 of the NOPR, the Department 

24 attempted to characterize the positions taken at the 

25 end of the negotiation process. In here it states, 

26 this is on the right hand side of 7292, lower right 

27 hand corner, the document states, “For medium-
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1 voltage liquid-immersed distribution transformers, 

2 the advocates represented by the Appliance Standards 

3 Awareness Project recommended efficiency level, also 

4 referred to as EL-3, for all design lines.” 

5 So we made it clear during the negotiation 

6 that we reserved the right to push for higher 

7 efficiency levels in a contested rulemaking. We 

8 also made it abundantly clear that we were very 

9 prepared to accept EL-2 as a negotiated outcome. I 

10 think everybody who was part of that process knows 

11 that there was a set of us in that negotiation 

12 process who were prepared to accept EL-2 as the 

13 outcome, the transcripts from that negotiation 

14 process reflect that. 

15 So let me just remove any ambiguity. We 

16 think EL-2 would be a good outcome as a final rule. 

17 EL-2 is best represented by TSL-4. Unfortunately, 

18 and this is a little shocking, the Department did 

19 not set up a TSL which reflects EL-2 despite the 

20 fact that a broad set of stakeholders supported that 

21 as a likely or as a good outcome, but TSL-4 is the 

22 closest to EL-2 as a – most closely represents EL-2 

23 as a TSL. 

24 So, I want to shift to correcting the 

25 record with respect to low-voltage dries. On low26 voltage dries, on the following page, the document 

27 states that “ASAP recommended EL-4 for all design 

28 lines.” Again, this is incorrect. We recommended 
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1 EL-4 for design lines seven and eight. We did not 

2 make a recommendation with respect to design line 

3 six. 

4 MR. BROOKMAN: Will you state where you 

5 are again in the record, Andrew? 

6 MR. deLASKI: So I’m in the middle of page 

7 7293. 

8 MR. BROOKMAN: Thank you. 

9 MR. deLASKI: Now I recognize that the 

10 Department was under extreme time pressure in 

11 preparing this NOPR, and I think we saw that during 

12 the negotiation process, and again I also applaud 

13 the consultants and the team for what was an 

14 extraordinary amount of work last fall and working 

15 under time pressure to both support a negotiation 

16 and to develop a NOPR at the same time, and I 

17 suspect that the NOPR, frankly, doesn’t reflect the 

18 full negotiation because we were still talking in 

December 22nd 19 , and you guys probably had to write 

20 this earlier in December. So I think that the 

21 record is, if you go back to the complete record, 

22 you’ll see that some additional work needs to be 

23 done to have the final rule reflect the complete 

24 record of the negotiation process. 

25 I also think, you know, it resulted in 

26 having to rush and, in rushing, mistakes get made 

27 and I understand that, but I just wanted to take the 

28 time to correct that record, and there are other 
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1 items within the NOPR that also will need to be 

2 corrected I think, based on the negotiation record. 

3 I want to then shift to low-voltage dry4 types. The choice that DOE made for low-voltage 

5 dry-type transformers, which is TSL-1, in our view 

6 does not adequately weight the consumer, 

7 environmental, and energy saving benefits from 

8 selecting higher levels. And specifically we 

9 recommend TSL-3, which is the same as EL-4 as the 

10 recommended standard that we think would be a better 

11 balancing of the seven factors and would lead to 

12 more significant energy savings. 

13 Now DOE, in choosing the lower efficiency 

14 level leans very hard on concerns about 

15 manufacturers. In fact, if you would choose the 

16 level that would maximize consumer benefits, you 

17 would choose the level that we’ve recommended. In 

18 leaning on impacts to manufacturers, there’s really 

19 a focus on the capacity of small manufacturers to be 

20 able to miter transformers or shift to wound-core 

21 construction. 

22 We think that the impact on small 

23 manufacturers is an important factor to consider in 

24 the rulemaking, but it’s not the only factor, and 

25 the decision-making here seems to have turned on 

26 this one critical question of what are the impacts 

27 on small manufacturers. If you look at the data, 

28 the Department says that about 50 percent of low 
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1 voltage dry-type transformers manufactured in the 

2 rulemaking. And so specialty – there are a lot of 

3 specialty low-voltage dries, and this is where most 

4 of the small manufacturers have the bulk of their 

5 business that is outside the scope of this 

6 rulemaking. 

7 The Department also concludes that 75 

8 percent of low-voltage dry-type transformers are 

9 manufactured in Mexico. These are the commodity10 grade transformers that make up the bulk of the 

11 market, and also make up the bulk of the opportunity 

12 for energy savings, are being manufactured in Mexico 

13 by high volume transformer manufacturers, as opposed 

14 to by the small manufacturers that appear to be the 

15 primary concern the Department raises with respect 

16 to going to higher efficiency levels. 

17 So then turning to small manufacturers, 

18 the concern the Department raises is the access to 

19 mitering machines. To go to EL-4, we recognize, 

20 would require manufacturers to miter their cores. 

21 You’ve got two options, to buy a mitering machine, 

22 which the record shows is an investment of about a 

23 half a million dollars for a basic mitering machine, 

24 or you can source your cores. About 50 percent of 

25 small manufacturers, according to DOE, already have 

26 a mitering machine. Half a million dollars is a 

27 significant investment, but it’s not an investment 

28 that’s outside the reach of most viable businesses. 
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1 Manufacturers readily acknowledge that 

2 they already source their cores. Big manufacturers, 

3 the biggest manufacturers to the smallest 

4 manufacturers, source cores today. So the notion 

5 that you can’t have a viable business that sources 

6 cores is inaccurate. It is part of the business 

7 today. There is no reason why it can’t be a 

8 continuing part of the business in the face of a new 

9 efficiency standard. 

10 So we think that DOE’s rationale for not 

11 selecting the higher level, EL-4, is poorly argued, 

12 is not substantiated by the record, that 

13 manufacturers can choose to either source cores or 

14 to invest in mitering machines to get to the higher 

15 efficiency level of EL-4, that DOE should reconsider 

16 and reevaluate the options of small manufacturers to 

17 comply with the standard. 

18 Finally, I would say that it would be 

19 irrational, almost silly, to deny the public 

20 billions of dollars in net consumer benefits for 

21 want of a few million dollars in investment capital 

22 in mitering machines. We’re talking about – how 

23 many mitering machines are we talking about? What’s 

24 the investment? The Department’s analysis doesn’t 

25 address this question. We’re talking about 

26 significant benefits for consumers and for the 

27 environment that are being left at the table for 

28 want of a small amount of money to invest, 
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1 relatively small amount of money to invest in 

2 mitering equipment. 

3 So, two recommendations, which are 

4 somewhat related but not entirely. One is that the 

5 Department needs to do additional analysis to fill 

6 in the gaps in the engineering curves. This was 

7 discussed during the rulemaking process. If you 

8 look through the negotiation process, if you look at 

9 the results of DOE’s analysis of the national impact 

10 analysis and the LCC, what you’ll see is there’s not 

11 a big difference between TSL-1, TSL-2, and TSL-3. 

12 The Department shows, in fact, that the life-cycle 

13 cost analysis is identical between TSL-1 and TSL-2. 

14 That’s a shocking result. It’s a result that’s 

15 inconsistent with the record, because the 

16 manufacturers and everyone sitting around the table 

17 said the consumers buy the low-voltage dry-type 

18 transformers based on first cost. The market is 

19 exactly at the DOE standard, the lion share of the 

20 market. Yet the DOE analysis shows that if you go 

21 from TSL-1 to TSL-2, there’s no change. And we 

22 discussed this during the negotiation process, the 

23 reason for that DOE has modeled a flat or virtually 

24 flat curve, no change in LCC results as you move 

25 from TSL-1 to TSL-2 to TSL-3. And that’s simply not 

26 what’s being observed in the marketplace. 

27 Purchasers are deciding to buy low cost transformers 

28 because they’re focused on first price and to go up 
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1 to higher efficiency levels does entail an increase 

2 in first cost, and that’s not reflected in the 

3 numbers. So DOE needs to do additional analysis to 

4 fill in those gaps in those scatter plots so that we 

5 know what the shape of that curve is. DOE’s 

6 consultants during the analysis said on the record, 

7 during negotiation, that the analysis for TSL-3 was 

8 robust, but they were concerned that the analysis 

9 for TSL-2, for EL-2 and EL-4 was inadequate, and 

10 that’s the case. It’s inadequate analysis. We 

11 don’t have a curve that reflects the actual changes 

12 in costs as you go from TSL-1, EL-1 to 2, to 3, to 

13 4. When you fill in those gaps, I think you’ll see 

14 a shape that would suggest that there’s a more 

15 significant change in national savings as you go up 

16 from 1, to 2, to 3. 

17 One of the gaps that we think needs to be 

18 filled in is to look at M4 butt-lap designs for low19 voltage dry-type transformers. This is a gap that 

20 we think will show that there’s a more cost21 effective standard at that level. 

22 So this leads to my second recommendation 

23 which is that DOE needs to more fully investigate 

24 the limits of butt-lap manufacturing methods with 

25 material substitution. And the Department has 

26 concluded in the NOPR that TSL-1 is the highest 

27 level that you can go to and still use butt-lap 

28 manufacturing techniques. And says, we can’t go to 
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1 TSL-2, which is the NEMA premium level, because you 

2 can’t butt-lap at TSL-2. Yet during the negotiation 

3 process, manufacturers said they butt-lapped at EL4 2. So here we have a decision based on an assertion 

5 which is not supported by substantial evidence on 

6 the record. 

7 So DOE, by investigating what are the 

8 limits of butt-lapping manufacturing techniques 

9 using material substitution will be able to more 

10 fully make a decision based on that criteria, which 

11 is apparently quite important to the Department. 

12 Now, don’t get me wrong, we don’t think butt-lapping 

13 should be the criteria by what DOE makes its 

14 decision. We think, as I said in my opening 

15 remarks, that standards that can be achieved by 

16 mitering or wound cores are fully justifiable based 

17 on the record. But if you’re going to decide, make 

18 a decision based on the limits of butt-lapping, then 

19 you need to look for those limits thoroughly. 

20 So let me shift to medium-voltage liquid21 immersed. For this equipment super class, the level 

22 proposed by DOE is far below the point which would 

23 maximize consumer benefits. As with low-voltage 

24 dries, the Department has put an inordinate amount 

25 of weight on the impacts on manufacturers to the 

26 detriment of the potential for consumer benefits. 

27 Indeed, the difference between the level the 

28 Department proposed and the level that we support, 
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1 which is EL-2, and EL-2 being best represented by 

2 TSL-4, a difference of a multiple of four. So four 

3 times the energy savings, four times the net 

4 consumer benefits going from the level proposed to 

5 the level that we support. 

6 The Department leans, in this 

7 determination, on impacts on manufacturers, clearly 

8 leans on three things: impacts on the transformer 

9 manufacturers, particularly small manufacturers, the 

10 availability of amorphous metal, and impact on steel 

11 manufacturers. These are the three concerns 

12 outlined as to the reason why DOE hasn’t gone to 

13 levels that would result in larger benefits for 

14 consumers. And the crux of each of these points is 

15 the crossover point. We all discussed at length last 

16 fall, where is this magical crossover point? Where 

17 is it that you find that you get robust competition 

18 between manufacturers of grain-oriented electrical 

19 steel and amorphous metal. We think finding that 

20 crossover point is a critical part of the decision. 

21 We think it’s appropriate. We want to have an 

22 outcome where we have robust competition amongst 

23 core steel suppliers, core material suppliers. We 

24 think it’s valuable to have three domestically based 

25 domestic manufacturers of core material suppliers 

26 who are competing robustly in the marketplace to 

27 provide core material. In the market today, the 

28 grain-oriented electrical steel manufacturers have 
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1 the lion’s share of the market, AK and Allegheny 

2 Ludlum are the incumbent players in the core steel 

3 market, so we have two – two competitors who have 

4 the lion’s share of the market. Move into a market 

5 where we have three competitors we think would be a 

6 better competitive outcome than the status quo. 

7 So the question is, where is that 

8 crossover? During the negotiation – so DOE seems to 

9 have concluded that sticking with the status quo 

10 where we have two competitors is a good outcome. 

11 That’s essentially what we have. During the 

12 negotiation, two of the largest manufacturers said 

13 on the record that this crossover point, where you 

14 get robust competition between amorphous metal and 

15 conventional electrical steel is roughly at EL-2. 

16 So again, roughly TSL-4. A third major manufacturer 

17 on the record said that it’s roughly at EL-1.5. 

18 Steelmakers and unions endorsed EL-1 in a 

19 written letter submitted to the Department shortly 

20 after the new year. EEI, APPA, and NRECA also 

21 endorsed EL-1 in a letter submitted to the 

22 Department in January. So these positions reflect a 

23 diversity of views as to where that crossover point 

24 actually is. Now, incredibly, and this is really 

25 shocking, the Department actually took the standard 

26 below a level recommended by any of these 

27 stakeholders in their written comments. Now, I’m 

28 not surprised to hear backpedaling this morning, the 
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1 folks say yeah, the proposal looks good, but it’s 

2 actually lower than what they recommended. So for 

3 the lion’s share of the transformers on the market 

4 for the small single-phase transformers, liquid5 immersed transformers, the proposal was EL-point 

6 four. Yet all the stakeholders I just named 

7 supported a level higher, EL-1. EL-1.5, EL-2 as the 

8 likely crossover point. You know, it’s almost mind9 boggling the Department would go to a level that’s 

10 below that recommended by anybody. 

11 So we think it’s reasonable to consider 

12 going to higher levels in the final rule, as I know 

13 the Department does too and has been clear about its 

14 proposal. As we think about where that crossover 

15 point is, we think it’s reasonable to look to the 

16 data and the information from the record during the 

17 negotiation by manufacturers which show that that 

18 crossover point is roughly at EL-2 or EL-1.5. 

19 However, the Department needs independent 

20 analysis, so our recommendation is that DOE needs to 

21 do a thorough, independent analysis of its own of 

22 what the likely crossover points are. Now it’s 

23 unlikely to be a single point. This analysis needs 

24 to recognize that there’s pricing power in the 

25 market for materials. These are large companies 

26 that have significant market share. They aren’t 

27 price takers. Financial data, financial reporting 

28 indicates that grain-oriented electrical steel is a 
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1 very high profit margin product. Indeed, it is the 

2 profit-making center for the steel makers, and that 

3 indicates a market in which these folks have some 

4 pricing power. So to suggest that they’re going to 

5 stand idly by and leave prices unchanged while a 

6 competitor enters the market just isn’t accurate. 

7 Prices are a factor that will shift in response to 

8 new market entries or nearly competitive market 

9 entries. 

10 So DOE needs to do a new analysis, 

11 independently analyzing the competitive – where are 

12 these materials competitive - and recognizing that 

13 you’re not going to get a single point answer 

14 because the prices of the materials will shift in 

15 response to the new standards. 

16 And the final concern is the impact on the 

17 steel manufacturers. This is, of course, a 

18 legitimate and important area for the Department to 

19 investigate and of concern to, I think, all of us. 

20 The incumbent steel manufacturers, of course, have a 

21 strong interest in the outcome. Jobs in 

22 manufacturing steel, there are jobs in manufacturing 

23 amorphous metal. DOE asserts their concern for 

24 steel manufacturing jobs, yet has not provided any 

25 analysis on what the impact on steel manufacturing 

26 jobs are - simply assertions. So the rule will 

27 undoubtedly affect steel manufacturers and the 

28 manufacturers of amorphous metal, but how? Overall 
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1 the demand for silicon steel will go up as a result 

2 of the low-voltage dry- type rule. It will go up as 

3 a result of the medium-voltage dry-type rule. 

4 Indeed, a press release issued when the NOPR came 

5 out, AK said, looks like our demand is going up 

6 because of this rule. The demand for silicon steel 

7 went up as a result of the 2007 rule. So the 

8 conventional steel manufacturers have seen 

9 significant increase in demand for high value 

10 electrical steel as a result of the 2007 rule, and 

11 again they will as a result of this NOPR if it’s 

12 finalized as a final rule. 

13 What we don’t know is, at what point does 

14 the demand start to go down, because DOE hasn’t done 

15 the analysis. We’re seeing increased – there will 

16 be increased tonnage for more stringent standards. 

17 What you don’t know is at what point does that 

18 increased tonnage turn into decreases in tonnage, 

19 because they start to lose market share to amorphous 

20 metal. Finding that point is a critical charge for 

21 the Department, as it moves to go to a final rule. 

22 What’s the current tonnage? What changes would you 

23 see at different standard levels? And what are the 

24 overall domestic jobs at stake? What’s the current 

25 employment levels in steel manufacturing for 

26 electrical steel and what are the potential impacts 

27 of standards on – improved standard levels – for 

28 manufacturers of core material, whether those jobs 
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1 are in Pennsylvania or South Carolina. This 

2 analysis simply hasn’t been done, yet the Department 

3 bases its decision, in part, on it. There’s no 

4 substantial evidence on what the Department has 

5 based its decision on when it comes to steel 

6 manufacturers thus far. 

7 So our second recommendation is that DOE 

8 do that analysis. I’m going to close with a 

9 discussion of product classes. Greg raised this in 

10 his comments about NEMA’s recommendations for 

11 specific treatment for transformers. We all 

12 discussed this at some length last fall. In our 

13 comments at the PTSD [preliminary technical support 

14 document] phase, we suggested that DOE should 

15 investigate separate standards for pads versus 

16 poles. We still think this is a valid approach, and 

17 that DOE should investigate and consider trial 

18 standard levels that set different standards for 

19 pads versus poles. Indeed, the whole analysis is 

20 based on that. The proposed rule then combines the 

21 pad and poles into a proposal, which again is not – 

22 the LCC results in the document don’t even reflect 

23 the actual standards proposed because the analysis 

24 is based on pads versus poles. 

25 So we think that looking at separate 

26 standards for pads versus poles would be a way to go 

27 forward that would recognize the differences between 

28 pads and poles, and potentially be able to reap some 
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1 of the significant savings going to higher levels 

2 with pads than you do with poles. Now we heard a 

3 lot about poles during the transformer negotiations, 

4 particularly from the rural utilities, and we heard 

5 those concerns and we think that separating these as 

6 separate product classes would make good sense. 

7 There also was a discussion of high BIL 

8 ratings during the negotiation. We think that 

9 looking at separate standards for high BIL ratings 

10 and low BIL ratings make sense. The bottom line is 

11 that the bulk of the market is in the low BIL 

12 ratings. You don’t want the standards to be held 

13 back by the high BIL transformers because of the 

14 difficulties of making those more efficient than 

15 making low BIL transformers reach higher efficiency 

16 levels, such as EL-2 or TSL-4. 

17 So our final recommendation is that DOE 

18 needs to evaluate some new trial standard levels. 

19 We would recommend that DOE first evaluate a trial 

20 standard level that reflects EL-2 across the board. 

21 We second would recommend that DOE evaluate a trial 

22 standard level that evaluates EL-1.5, a level 

23 identified by one of the major manufacturers as a 

24 likely crossover point. We also would suggest TSL25 A1 and B1, that is for each of those then lower the 

26 standard by one EL for the poles. So that would be 

27 EL-2 across the board, except for EL-1 for pole28 mount transformers and EL-1.5 across the board, 
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1 except for El-.5 for poles. 

2 We think if DOE evaluated those TSLs and 

3 did the additional analysis that we’ve described, 

4 that you then would have before you a set of choices 

5 that would enable you to better balance the seven 

6 factors. As we stand right now, the entire 

7 weighting on, you know, what is the minimum 

8 disruption for manufacturers, and for steel 

9 manufacturers, and the result is that consumers are 

10 left with billions of dollars of net savings that 

11 are not being achieved, and considerable benefits 

12 for the environment that are being left on the 

13 table. Thank you. 

14 MR. BROOKMAN: Thank you. I want to hear 

15 from someone else first, and then I’ll bring it back 

16 to you, Phil. We don’t want to do the entire 

17 session here based on opening remarks. We want to 

18 be rather structured and go through the content 

19 that’s here in the slides, but these opening remarks 

20 I think are important, so we’ll keep doing this for 

21 a little bit. Is it Mike? Mike. 

22 MR. HYLAND: Mike Hyland, the American 

23 Public Power Association. No consumers have spoken 

24 yet, in my opinion. We’ve had environmentalists and 

25 manufacturers, and we represent 2000 municipalities 

26 that represent about 47 million consumers, and every 

27 single dollar increase in cost, guess what, gets 

28 passed directly to those consumers. We aren’t for 
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1 profit, so costs are a big issue for us. We are 

2 very happy with the way the rule came out. We can 

3 stand by it. But I also worry about the rule of 

4 unintended consequences. We sat here two years ago, 

5 or I sent comments here two years ago in a 

6 different rule and we agreed with what the agency 

7 came up with, and then between this point and the 

8 final rule in a certain area, we agreed, it 

9 increased. 

10 And now we’re sitting here in a real mess 

11 where the environmentalists are not happy either 

12 because this country is poised to actually have a 

13 less efficient situation going on as of 2015 if we 

14 don’t correct it. So when we look at unintended 

15 consequences, when you look at this rule, some of 

16 the reasons we’re concerned, if we did go higher at 

17 this point, is the refurbish market which you did 

18 not talk about in your comments. The refurbish 

19 market is a concern for us. We have some utilities 

20 doing that already. It’s an unintended consequence. 

21 Amorphous cores – many of our members are using it. 

22 They’re also showing us that they don’t last as 

23 long. We’ve heard some arguments there, but we have 

24 proof from one of our anecdotals that they don’t 

25 last the same amount of time as the steels we’re 

26 using today. And the other is the allocation of 

27 resources in these small communities. Every dollar 

28 you spend on an increased transformer budget is a 
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1 dollar you’re not spending in another energy2 efficiency manner, whether that is energy auditing, 

3 or that is lighting, or whatever it may be, those 

4 dollars are precious, and we’re getting whatever at 

5 this point in increase, and it’s going to decrease 

6 over here a lot more. So the unintended 

7 consequences of going higher, at this point, are 

8 actually going to hurt the communities that I 

9 represent. 

10 That’s all I have. We’re really happy 

11 with the process, everything went great. Really 

12 enjoyed the process since July. Thank you. 

13 MR. BROOKMAN: Other comments here at the 

14 outset? Steve Rosenstock. 

15 MR. ROSENSTOCK: Steve Rosenstock, EEI. 

16 Again, we were part of the process. We appreciated 

17 being part of the process. Just a couple of general 

18 thoughts in opening. I think DOE and the 

19 consultants have done quite a bit of analysis, in 

20 fact, it seemed like we were getting a new analysis 

21 every week somehow from the consultants. It was 

22 very amazing how they were able to put out so much 

23 work product. 

24 In terms of impacts on manufacturers, it 

25 does show in the NOPR, Table 5.38 on page 7359, what 

26 the impacts are on transformer manufacturers, based 

27 on the types of – this is for liquid-immersed 

28 distribution transformers. The NPVs [net present 
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1 values] are all negative across all TSLs. They did 

2 the analysis. They’ve already done the analysis in 

3 there. I don’t know what redoing that analysis is 

4 going to do, but they have shown summary results on 

5 the manufacturers. 

6 I heard a lot of discussion about the 

7 consumers. Well, APPA, NRCEA, and EEI, we’re – EEI 

8 is the largest consumer of transformers. We buy new 

9 products. We operate them, we maintain them, we 

10 replace them. We’re the consumers. I heard a lot 

11 of things about consumer benefits. With all due 

12 respect, as the actual consumer at the table, we’re 

13 happy to speak for ourselves, thank you very much. 

14 We have looked at the numbers. We look at them 

15 every day. We have our own way of analyzing them, 

16 and we think that the – we have some issues with the 

17 rule, especially because right now in the NOPR there 

18 is no discussion about how vaults and networks are 

19 going to be treated. Hopefully this session today 

20 we can discuss that and hopefully there can be some 

21 changes before the final rule. 

22 In terms of more analysis, because of the 

23 court-ordered settlement, DOE has to get this rule 

24 out October 1, 2012. If they do significant more 

25 analysis, they might have to do a supplemental NOPR 

26 and have more public hearings, and I don’t – the way 

27 the schedule is right now, which is the parties that 

28 sued the Department had agreed to this schedule, and 
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1 some of them are sitting in this room, the rule has 

2 to get out October 1, 2012, period, end of quote. 

3 So the idea of certain analysis might be nice, but I 

4 don’t think the Department has time under the 

5 settlement. Thank you very much. 

6 MR. BROOKMAN: Other comments, before we 

7 start doubling back? Okay. Jerry first. 

8 MR. CORKRAN: Jerry Corkran, Cooper Power. 

9 I want to speak just on the medium-voltage liquid10 filled. The DOE says in the proposed ruling that 

11 the crossover is EL-1. That’s what our computer 

12 programs agree with Navigant on. It’s an equal 

13 playing field at EL-1 between amorphous and silicon 

14 core steel, and when you go – whether you go to EL-2 

15 or EL-3 it’s totally dominated by amorphous, so it’s 

16 like a teeter-totter when you go past El-1, it’s not 

17 a level playing field any more. I want to emphasize 

18 that point. 

19 MR. BROOKMAN: Okay. Thank you. I might 

20 suggest pretty quickly we move towards a more 

21 systematic discussion of the content that’s in the 

22 record. We’ll take a few more comments. Phil, 

23 please. 

24 MR. HOPKINSON: Phil Hopkinson, HVOLT, 

25 Inc. My good friend, Andrew deLaski, made some 

26 comments and I must certainly put something on the 

27 record, and having been an engineering manager for 

28 both GE’s low-voltage dry-type products as well as 
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1 Square D’s low-voltage dry-type products, and having 

2 done a considerable amount of work on market size, 

3 what I can tell you is if we take the low-voltage 

4 dry product in total, that there are about 600 

5 million sheets of steel that would make up a stack6 core product that covers the industry of low-voltage 

7 dries in a normal year today. And as having looked 

8 at the investment required to do that with mitering, 

9 it would be something that takes not just half a 

10 million dollars, but millions and millions of 

11 dollars to be able to do that, and that has always 

12 been the concern of the low-voltage dry industry, of 

13 how much investment can be mustered to support that 

14 industry. 

15 The small manufacturers that exist in 

16 Virginia, in Pennsylvania, in New Jersey, in 

17 California, and a good many other states, absolutely 

18 cannot afford that investment, and so the issue is 

19 will we put those manufacturers out of business, or 

20 will we force them to, in effect, purchase cores and 

21 perhaps run out of work for them anyway? So that’s 

22 low-voltage dries. 

23 The other piece is in medium voltage, and 

24 I could summarize everything by saying that as Jerry 

25 Corkran had indicated, the cliff between M3 and 

26 amorphous is at design efficiency level one. If you 

27 go past that, it’s a hard move to amorphous and it 

28 cuts off M3 core steel and therefore domestic grain-
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1 oriented electrical steel and moves it to a Hitachi 

2 product that’s out of the country, so that it is not 

3 a case of well, maybe we can negotiate a little bit. 

4 It’s a hard move. That’s all I have. 

5 MR. BROOKMAN: Thank you. I’d like to 

6 proceed then with the presentation slides, get Brian 

7 Coffey up here. I presume that most of what’s been 

8 said here in these opening remarks is embedded in 

9 this content, and I’d like to go through and get the 

10 varying and different perspectives based on the 

11 presentation material. 

12 Many of you have participated in the 

13 negotiation. Some of you have not participated in 

14 this kind of a meeting where there’s a real 

15 structured opportunity following presentations to 

16 get a vigorous discussion going. So let’s do that 

17 now. Brian. 

18 Rulemaking History, Schedule and Scope 

19 Negotiated Rulemaking Process 

20 MR. COFFEY: Brian Coffey with Navigant. 

21 I think because of the negotiation process many in 

22 the room are more familiar than usual with some of 

23 the details of how DOE does its analysis, so I’ll 

24 try to move quickly through these slides. For the 

25 NOPR stage of the rulemaking, DOE revises several 

26 analyses first presented during the preliminary 

27 analysis phase and they conduct some other specific 

28 to the NOPR. For the final rule, DOE performs 
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1 revisions to the NOPR analyses as needed. 

2 Here’s an overview of the current 

3 standards for distribution transformers. I 

4 mentioned earlier that low-voltage dry-type has 

5 standards set by EPACT 2005, and that both liquid6 immersed and medium-voltage dry-type were regulated 

7 in the 2007 final rule. Medium-voltage dry-types 

8 were unique in that they had standards that varied 

9 by BIL rating, and DOE is considering extending this 

10 practice to liquid-immersed units as a result of the 

11 stakeholders’ discussion during the negotiated 

12 rulemaking process. 

13 EPACT 2005 had also presented the 

14 definition of distribution transformer, which was 

15 refined by the 2006 test procedure rulemaking. I’ll 

16 skip reading it aloud for brevity. You can find the 

17 text in your handouts. 

18 Here’s the second half of that definition. 

19 This is how the terms liquid-immersed, low-voltage 

20 dry-type, and medium-voltage dry-type are defined. 

21 MR. BROOKMAN: Pause there for a moment. 

22 Any comment on these definitions? Okay. 

23 MR. COFFEY: So here are two requests for 

24 comment on the definitions. DOE received comment 

25 that rectifier and testing transformers should 

26 indicate on their nameplates that they are for such 

27 purposes exclusively, and request comments on its 

28 proposal to require that. 
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1 Currently, underground mining transformers 

2 are not subject to standards. DOE received comment 

3 that transformers used in certain other underground 

4 activities, but not mining per se, may face 

5 constraints similar to those faced by underground 

6 mining transformers. DOE has not proposed to expand 

7 the definition of underground mining transformer, 

8 but requests comment and information useful in 

9 precisely expanding the definition to encompass any 

10 activity that entails remove of material 

11 underground, such as digging or tunneling. 

12 

13 MR. BALLO: Tim Ballo, EarthJustice. A 

14 couple things on this issue. In the preamble for 

15 the Federal Register NOPR there is a discussion of 

16 including a nameplate on rectifier and testing 

17 transformers. I think in principle that’s a good 

18 idea. However, there wasn’t, at least I don’t 

19 believe there was actual proposed regulatory 

20 language in the proposed changes to the CFR [Code of 

21 Federal Regulations]. I don’t know that’s critical, 

22 but it is usually helpful to see that in case there 

23 are issues with that proposed language. The only 

24 question I think I have on the nameplate requirement 

25 is whether that’s sufficient. I think we heard 

26 during the negotiations quite a bit from the 

27 manufacturers about potential loopholes, some of the 

28 transformers that are defined in the regulations 
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1 that are exempt from the standards for distribution 

2 transformers, particularly other than the rectifier 

3 and testing units, the uninterruptable power supply 

4 units, and the sealed and non-ventilating 

5 transformers. So, I think we had a really 

6 productive couple of work groups during the 

7 negotiations to arrive at some consensus definitions 

8 for networks and vaults and for data center units, 

9 and I am happy to continue with those discussions 

10 for any of the other transformers that are of 

11 concern as a potential loophole for these standards 

12 and to jointly recommend with the manufacturers some 

13 proposed changes to the regulatorily defined exempt 

14 products. So, happy to have those discussions. 

15 

16 MR. BROOKMAN: Thanks, Tim. We can see the 

17 two comment boxes. Comments to in response to 

18 these: the issue of nameplates and precisely 

19 extending the definition to encompass any activity 

20 that entails the removal of material underground. 

21 Steve Rosenstock. 

22 

23 MR. ROSENSTOCK: Steve Rosenstock,EEI. So 

24 does this mean, in Issue 5, that DOE would regulate 

25 these nameplates as part of the efficiency standard? 

26 

27 MR. COFFEY: The proposal is to expand the 

28 requirement that such transformers that are for 
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1 these purposes indicate that on their nameplates. 

2 So, that would be part of the regulation, yes. 

3 

4 MR. ROSENSTOCK: So DOE would have to 

5 enforce that as part of their regulations? 

6 

7 MR. COFFEY: Just as any other regulation, 

8 sure. 

9 MR. BROOKMAN: I’m not seeing anybody 

10 wanting to comment on those. Nothing to be said. 

11 Phil. 

12 MR. HOPKINSON: Phil Hopkinson, HVOLT, 

13 Inc. I’m making the presumption that if a 

14 transformer is a rectifier transformer and perhaps a 

15 three-phase, and perhaps it’s a delta primary with a 

16 delta and a Y low voltage or some multiple low 

17 voltages, that it would be pretty obvious just by 

18 the way it’s configured that it’s for rectifier 

19 applications. But are you suggesting that the word 

20 rectifier needs to be added to the nameplate as 

21 well? It just adds more congestion. 

22 MR. COFFEY: So that’s helpful feedback. 

23 If there’s not room on the nameplates, you could 

24 comment on that. 

25 MR. BROOKMAN: Okay. So with no 

26 additional comments, we’re going to move on. 

27 MR. COFFEY: DOE published a test 

28 procedure for distribution transformers in 2006, 
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1 which is used to assess compliance today. DOE is 

2 considering making updates to that test procedure 

3 and has requested comment on a number of test 

4 procedure-related issues. Some of the issues that 

5 have been raised with respect to test procedure. 

6 Currently DOE requires that transformers be tested 

7 in the winding configuration that produces the 

8 greatest losses, but it has received comment that 

9 this may significantly disadvantage certain types of 

10 transformers. Allowing compliance in any 

11 configuration, however, allows transformers to be 

12 operated in a mode less efficient than that in which 

13 they comply. 

14 DOE seeks comment on winding 

15 configurations as they relate to energy efficiency, 

16 data on how often transformers may be operated in 

17 each configuration, and on characteristic efficiency 

18 differences between the two configurations, two or 

19 more configurations. 

20 Also, DOE requests comment on its proposal 

21 to require compliance at only KVA ratings that 

22 correspond to passive cooling in cases of units with 

23 more than one KVA rating. 

24 Okay. We’ll move on. 

25 MR. BROOKMAN: Hang on, one moment. 

26 MR. ROSENSTOCK: Steve Rosenstock, EEI. 

27 It’s actually a bigger, kind of a general question. 

28 If you’re talking about – you’re saying update the 
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1 test procedures. Is there a separate rulemaking 

2 going on for updating these test procedures, because 

3 I thought there’s supposed to be finalized before a 

4 new rule takes effect. Am I – is that – 

5 MR. COFFEY: That’s right. DOE hasn’t 

6 published anything yet, but is considering doing so. 

7 MR. ROSENSTOCK: Steve Rosenstock, EEI. 

8 Is it – but at what stage? Is it – would it be at 

9 the preliminary analysis stage, the NOPR stage for 

10 the test procedure? Or a final rule stage for the 

11 test procedure? The reason I’m asking is because of 

12 the timing. 

13 MR. COFFEY: Sure. And you’re correct to 

14 point out that there’s a requirement that test 

15 procedure must be finalized so many days before the 

16 final rule is published. So DOE would have to 

17 observe that requirement. 

18 MR. ROSENSTOCK: Okay. So – again, Steve 

19 Rosenstock, EEI. Is there a schedule for this test 

20 procedure update? 

21 MR. COFFEY: None that has been publicly 

22 announced yet. 

23 MR. ROSENSTOCK: Okay. 

24 MR. BROOKMAN: Jim Raba. 

25 MR. RABA: Right now we’re just taking – 

26 Jim Raba, DOE – comments from interested parties 

27 about the test procedures and could they be amended, 

28 could they be upgraded? Should we take a look at 
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1 them? If it’s going to be scheduled, there’s time 

2 yet to entertain this as a possibility for the 

3 future. 

4 MR. BROOKMAN: Phil. 

5 MR. HOPKINSON: Phil Hopkinson, HVOLT, 

6 Inc. As I sit here thinking about the implications 

7 of the passive cooling, it’s close, but I don’t 

8 think it quite captures everything, because some 

9 transformers will have a 55/65 degrees C rise 

10 rating, and there’s a different KVA that goes with 

11 both ratings. So the question I would have is, does 

12 it go to the base rating, which I really think is 

13 probably the right answer, or does it go truly to 

14 this area that makes it somewhat metaphysical? 

15 MR. BROOKMAN: John. 

16 MR. CASKEY: John Caskey, NEMA. Two 

17 points. One is that we really didn’t intend to 

18 address all of these issues in the meeting today. 

19 We really intend, as NEMA, the organization, to 

20 basically submit formal comments by the due date I 

think is April 10th 21 or something on that order. So, 

22 as an industry, will get together and try and 

23 address all of these things effectively, then get a 

24 written response to them by the April due date. 

25 The other point dealing specifically with 

26 testing, since NEMA does essentially own the testing 

27 standard at this point, we would be happy to work 

28 not only as the industry to try and address any 
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1 concerns that DOE might have and make sure that they 

2 are addressed in the next version of that standard, 

3 but we’d also be happy to work directly with DOE to 

4 make sure that we can – we can get the industry’s 

5 view on whatever changes that they propose relative 

6 to the testing standards, just to make sure they do 

7 – they are sort of validated that they will work 

8 effectively with the industry. 

9 MR. BROOKMAN: Okay. Thank you. You can 

10 see the comment boxes there. Additional comments on 

11 these two issues? Okay,Brian. 

12 MR. COFFEY: With respect to BIL ratings, 

13 DOE proposes to maintain the requirement that 

14 transformers comply with standards at the BIL rating 

15 of the winding configuration that produces the 

16 greatest losses. So this is currently what is 

17 required today. But DOE requests comment on this 

18 proposal. It’s worth noting that this is currently 

19 only applicable for medium-voltage dry-type units. 

20 Another issue raised during negotiations 

21 was that of test procedure loading. DOE requests 

22 comment on its proposal to maintain current loading 

23 values for all types of distribution transformers 

24 within its scope, and any data useful in considering 

25 the matter. 

26 MR. BROOKMAN: So let me say that it’s 

27 also helpful to comment if you think the Department 

28 is going in the right direction. Yes, Greg. 
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1 MR. COULTER: This is Greg Coulter, 

2 Prolec-GE. I guess I’d like to make some general 

3 comments on what’s been said here. During the 

4 negotiated rulemaking there was a lot of discussion 

5 about this dual voltage issue, as well as the BIL 

6 issue. Andrew mentioned it in his comments, and I 

7 think these were important points, as we thought 

8 that for dual voltage units either on the high side 

9 or the low side, they ought to line up with IEEE 

10 standards. While there’s not a big difference in 

11 losses, it makes it a real complication in the whole 

12 process of manufacturing transformers to have a 

13 whole different methodology for DOE than exists for 

14 the industry, that these ought to line up. 

15 The same is true – we discussed the BIL, 

16 having different levels for different BILs, and 

17 maybe even for dual voltage. That doesn’t change. 

18 That issue is still on the table, especially as the 

19 whole issue of what final efficiency is going to 

20 come out is still on the table. It’s important to 

21 keep these issues on the table and we comment to 

22 them. It’s tough to comment when you don’t know 

23 what efficiency you’re trying to hit and a few other 

24 things, but those issues remain, and we think they 

25 ought to be segregated in any final rule that comes 

26 out. It would require a change in the testing 

27 standard. We wonder if that really could happen, 

28 but we think that’s the appropriate thing to do. 
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1 MR. BROOKMAN: Okay. Phil. 

2 MR. HOPKINSON: Oh, I’m – Phil Hopkinson, 

3 HVOLT, Inc. I would ditto what Greg just suggested, 

4 that – and especially I can think in the dual 

5 voltage area that sometimes we’ll have two ratings 

6 that require two different BIL ratings, so the 

7 transformer fundamentally gets insulated for the 

8 highest BIL. But the testing, I certainly would 

9 concur that if we can align that with IEEE’s 

10 requirements, it makes life much better for those 

11 who are manufacturing the transformers. 

12 MR. BROOKMAN: Brian, is there anything 

13 specific you want to get out of this that you want 

14 to ask in addition to the comment boxes? 

15 MR. COFFEY: No, I think just to Steve and 

16 John’s points, these are in here not because the 

17 matter needs to be fully discussed or decided today, 

18 but because DOE wants to draw attention to these 

19 issues so that people can start thinking about them, 

20 and submit detailed comments so that if DOE does 

21 decide to take some action on the test procedure, it 

22 can be as informed as possible. 

23 MR. BROOKMAN: Additional comment? Yes, 

24 Bob? 

25 MR. SAINT: Yes, I’m Bob Saint with 

26 National – NRECA. And just an observation. I don’t 

27 know that much about testing, but just remind folks 

28 that the testing procedure has little relationship 
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1 to the loading – actual loading and operation of the 

2 transformers. And they just define the way that we 

3 define the percentage, percentage of loading, of 

4 efficiency. And if we go and change the testing 

5 procedures, keep in mind that it’s still not going 

6 to reflect the operation of the transformer. We 

7 can’t, because all transformers are operated 

8 differently. But they will change the way that the 

9 numbers come out. So to me it will confuse the 

10 issue more than help this situation. But, again, 

11 I’m not the expert on testing, but it seems like 

12 opening up this part of the process with the short 

13 time we have is not a productive use of our time. 

14 MR. BROOKMAN: Okay. 

15 EPCA Factors, Scope, Definitions, 

16 Test Procedures, Equipment Classes 

17 MR. COFFEY: So here’s the rulemaking 

18 diagram again, and we’ll start by looking at the 

19 market and technology assessment.

20 Here’s a mapping of DOE’s scope of 

21 coverage into equipment classes. These have not 

22 changed since the preliminary analysis, by the way. 

23 Each transformer type has classes for single and 

24 three-phase units, and then medium-voltage dry-type 

25 is further subdivided by BIL rating. So, just a 

26 reminder. 

27 Here’s a scope issue. DOE received 

28 comment that step-up transformers which are 
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1 currently not subject to standards may be used as 

2 step-down transformers in certain cases to 

3 circumvent standards. DOE is not currently 

4 proposing to set standards for step-up transformers, 

5 but does request comment on whether or not they 

6 represent a potential loophole. 

7 MR. BROOKMAN: Steve Rosenstock. 

8 MR. ROSENSTOCK: Steve Rosenstock, EEI. 

9 The second bullet, I’m just – you know, on 

10 distribution network, they’re using step-down 

11 transformers to serve commercial and residential 

12 buildings. Can you give me an example of why you 

13 would replace a step-down transformer with a step-up 

14 transformer? I’m really curious. 

15 MR. COFFEY: I think the question is, if 

16 they’re not subject to standards and significantly 

17 cheaper, will a consumer opt to use a step-up 

18 running backwards? 

19 MR. ROSENSTOCK: Oh, I see. 

20 MR. BROOKMAN: Greg, please. 

21 MR. COULTER: This is Greg Coulter, 

22 Prolec-GE. We do want to make a comment here, and 

23 that is we believe this is an issue, step-up 

24 transformers being used for step-down transformers. 

25 It’s easy for a customer to say sell me a step-up 

26 transformer. For us, it’s the same thing. We don’t 

27 care. We give you voltages, what it will do, it can 

28 go up, it can go down. We believe somehow this 
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1 needs to be recognized and we think it ought to be 

2 recognized the same way that it ought to be 

3 recognized for rectifier transformers, test 

4 transformers, everything else. It ought to be 

5 identified on the transformer. If you’re going to 

6 exclude step-up transformers, it ought to be 

7 specified on the transformer, this is for step-up 

8 applications only. We think for rectifier 

9 transformers they ought to say for that application 

10 only. For test transformers, that application only. 

11 For mining transformers, that application only. You 

12 can find room on a nameplate someplace. I mean, 

13 they don’t take a lot of space, but they ought to be 

14 either specified that way or not and excluded in the 

15 standard. 

16 MR. BROOKMAN: Thank you. 

17 MR. HOPKINSON: The only area – this is 

18 Phil Hopkinson, HVOLT, Inc. The only area that I 

19 think that I would have to take my good friend Greg 

20 to task on is not that I would disagree that it’s a 

21 good idea to do it, it’s just that if I was the 

22 customer buying the transformer and I was smart 

23 enough to know that it didn’t matter, I could buy 

24 this so-called step-up transformer and use it in a 

25 step-down application anyway. So my good friend, 

26 Greg Coulter, just said he thinks it’s happened, and 

27 that doesn’t surprise me. So that I guess I would 

28 look at it more matter-of-factly, which is, you’re 
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1 either going to regulate them or you’re not going to 

2 regulate them, and the one area, of course, that we 

3 think of immediately is wind farm transformers. 

4 PARTICIPANT: Those are special. Yup. 

5 MR. BROOKMAN: Thanks Phil. So any other 

6 thoughts on this subject? Okay. 

7 MR. COFFEY: So, moving on, during 

8 negotiations DOE received comment that certain types 

9 of liquid-immersed transformers may be especially 

10 disadvantaged in terms of meeting higher standards. 

11 Two of those are network transformers and vault-type 

12 transformers, and because these are new, we’ll read 

13 the proposed definitions. 

14 Network transformer is designed for use in 

15 a vault for occasional submerged operation in water, 

16 and to feed a variable capacity system of 

17 interconnected secondaries – secondary windings. 

18 And that it’s built per the requirements of IEEE 

19 C57.12.40. 

20 Vault-type transformer is similar but not 

21 identical. It’s designed for use in a vault and for 

22 occasional submerged operation in water, and built 

23 per the requirements of IEEE Standard C57.12.23 or 

24 IEEE C57.12.24. 

25 And so these proposed definitions came 

26 directly out of the negotiation process and DOE is 

27 now requesting feedback on whether this is 

28 appropriate. 
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1 MR. BROOKMAN: Did the committee reach 

2 agreement on this? 

3 MR. COFFEY: There was a smaller subset of 

4 members that got together and talked about what 

5 would be a sensible definition, so this is the 

6 result of what they came up with. Yes. Yes. 

7 MR. BROOKMAN: Not by the entire 

8 committee? 

9 MR. COFFEY: I think most of the committee 

10 didn’t give input to this. 

11 MR. BROOKMAN: Greg, please. 

12 MR. COULTER: I think I would like to give 

13 just a bit more emphasis to this, since I did in my 

14 opening comments. 

15 MR. BROOKMAN: Were you a part of that 

16 working group? 

17 MR. COULTER: I personally was not, GE 

18 was. It was led by Wes Patterson, my colleague 

19 sitting here in the audience, I’m glad to see him 

20 here today. 

21 MR. BROOKMAN: Let me just – your 

22 impression was that the committee, the working 

23 group, agreed in principle to what’s being described 

24 here> 

25 MR. PATTERSON: (off microphone) There was 

26 unanimous agreement on the working group, but it was 

27 also presented to the formal committee and there was 

28 no dissension from the formal committee on either of 
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1 these definitions. 

2 MR. BROOKMAN: Okay. That’s an important 

3 point. That wasn’t on the record. He said it was 

4 formally presented and there was no decision by the 

5 larger committee. 

6 MR. PATTERSON: (off microphone) No, I 

7 said there was no dissension. 

8 MR. BROOKMAN: No dissension, thank you. 

9 MR. COULTER: No dissension, and that’s my 

10 point. I believe what Wes is trying in a backwards 

11 way to say is there was agreement on this. We 

12 charged that committee to come forth with this. I 

13 think even Andrew mentioned in his comments this. 

14 There was participants from the advocates as well as 

15 the manufacturers and users. We thought this one 

16 here was well vetted during the negotiating 

17 committee, and general consensus reached. 

18 Unfortunately, we did not vote finally in the total 

19 committee because we could never reach agreement on 

20 other issues to get to this point. But what we 

21 would like to do is see that work come forward and 

22 be presented again and utilized as the basis for 

23 reaching what we thought was basic agreement during 

24 the negotiation committee. 

25 MR. BROOKMAN: Okay. So what we’re doing 

26 here today is present some boundaries in what these 

27 meetings are supposed to accomplish and seeking 

28 consensus is not one of the things we typically do 
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1 in these kinds of meetings, although – we don’t do 

2 it here. So, but what we do want is full and 

3 complete comment from anybody that wishes to make 

4 full and complete comment. So let’s hear it – we’ve 

5 heard from you, Greg, thanks for that. Let’s hear 

6 from others that have comment on this subject. 

7 John. 

8 MR. PHOUMINH: John Phouminh, PEPCO 

9 Holding Inc. I, as the utility company, we 

10 certainly are behind this proposal. Basically, in 

11 the District of Columbia here, where we – that’s our 

12 service territory, we use a lot of network 

13 transformers, and we are facing with space 

14 constraints. Typically the old manhole is four and 

15 a half by seven, eight. If we were to follow what 

16 the proposal will be, the new transformer would not 

17 fit in that manhole, and that requires retrofit of 

18 course. The cost of retrofit manhole, pass it on to 

19 the rate payer, and the customer will not be happy. 

20 MR. BROOKMAN: Okay. So just to confirm, 

21 you see the comment box, DOE requests specific 

22 comment on the proposal to establish a separate 

23 equipment class, so let’s here from others on this 

24 point. Steve Rosenstock. 

25 MR. ROSENSTOCK: Steve Rosenstock, EEI. 

26 This was discussed during negotiation meetings and I 

27 think this is a very key issue for any utility with 

28 urban, especially in urban areas with the networks – 
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1 with existing networks and vaults. And I think the 

2 thought was there should be a carve-out for existing 

3 vaults – not new ones, but existing ones, just 

4 because, especially because of the size issue. 

5 There is just – there’s no room. And if the higher 

6 efficiency units need more space, or need more area 

7 for cooling, et cetera, and ventilation, it’s just 

8 not there. It won’t operate properly. So again, if 

9 there was a way to do it in the final rule to have 

10 some sort of carve-out for the efficiency levels 

11 required for network and vault transformers, we 

12 would be in favor of it. Thank you. 

13 MR. BROOKMAN: Thank you. Final comments 

14 on this? We’ve got a lot to cover here. Keep 

15 going. Andrew. 

16 MR. deLASKI: So – we’ve discussed this 

17 and we agree that there should be – this definition 

18 makes sense. I don’t know where it takes you in 

19 terms of efficiency levels. Steve’s comment that 

20 there’s no room, sometimes there’s no room. I mean 

21 there’s often the case that there’s no room and we 

22 don’t know what the incidence of that is. DOE has 

23 attempted to characterize this. Table V.18 of the 

24 NOPR presents the LCC results for vault 

25 transformers, and these LCC results indicate that 

26 there’s a range of results and if you wanted to 

27 minimize the cost for utilities and utilities – 

28 those costs then flow through to their customers, 
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1 would indicate that you would look at TSL – you want 

2 to minimize cost, you’re going to go to TSL-5. So I 

3 think the question is, you know, what level would 

4 you choose once you have a separate standard and the 

5 notion that it would stay at zero isn’t supported by 

6 the record. 

7 MR. BROOKMAN: Where you started was that 

8 conceptually you’re okay with this proposal. 

9 MR. deLASKI: I’m okay with the definition 

10 and I think – I’m not sure if levels will be 

11 discussed later. I don’t want my support for 

12 definition to be – to imply that I support leaving 

13 the standard unchanged. 

14 MR. BROOKMAN: I understand. Okay. So 

15 I’ll take final comments on this and then we’re 

16 moving on. For those of you that are wondering, 

17 probably in the next 15 minutes or so, we’re going 

18 to take a break, okay, if you’re getting antsy. 

19 MR. COFFEY: So also on scope, DOE 

20 received comment that a certain type of low-voltage 

21 dry-type transformer, those designed for data 

22 centers, may be disadvantaged in terms of meeting 

23 higher standards. DOE has proposed to establish a 

24 separate equipment class for data center 

25 transformers and defines them as the following: 

26 It’s designed for use in a data center 

27 distribution system and has a nameplate identifying 

28 the transformer as being for this use only. Has a 
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1 maximum peak energization or inrush current less 

2 than or equal to four times its rated full-load 

3 content multiplied by the square root of two as 

4 measured under certain conditions, and is 

5 manufactured with at least two of the six additional 

6 attributes, which are not on the slide, but I’ll 

7 read them. 

8  It’s listed by NRTL for K factor rating greater 

9 than K4; 

10  temperature rise less than 130 Celsius with 

11 class 220 insulation, or less than 110 Celsius 

12 with class 200 insulation. 

13  A secondary winding arrangement that is not 

14 delta or Y, 

15  copper primary and secondary windings, 

16  an electrostatic shield or multiple outputs at 

17 the same voltage. 

18  A minimum of 50 degrees apart, which when 

19 summed together equal a transformer’s KVA 

20 capacity. 

21 So the definition is a little bit 

22 cumbersome and not wonderfully lent to be fitting on 

23 a slide, but I did want to read it since it was new, 

24 and DOE requests comments on the proposal to 

25 establish a separate equipment class for data center 

26 transformers and on how such transformers might be 

27 defined. 
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1 MR. BROOKMAN: Phil. 

2 MR. HOPKINSON: Phil Hopkinson, HVOLT, 

3 Inc. I applaud the concept of having a data center 

4 transformer. The concept of the inrush current held 

5 to four times rating is not accurate, and what 

6 really needs to be – the first half-cycle is likely 

7 to be in the order of 15 times rated current, so 

8 that you would not be able to achieve that. But if 

it’s measured at a 1/10th 9 second point, and sometimes 

10 these are, then perhaps that can be achieved. 

11 MR. BROOKMAN: Okay. Other comments on 

12 the class thing. Steve Rosenstock. 

13 MR. ROSENSTOCK: Steve Rosenstock, EEI. 

14 Actually, kind of a bigger issue. In terms of a 

15 separate equipment class, again, maybe I didn’t read 

16 that section, does that – I’m neutral on it, you 

17 know, if there’s a need for it, then by all means, 

18 but the issue at this stage is, I don’t know were 

19 there separate efficiency levels in the NOPR for 

20 these products? If the answer is no, we have an 

21 equipment class that still has to meet the standards 

22 that have been set for all the other low-voltage 

23 dry-type transformers. If yes, then people need an 

24 opportunity to see what those proposed efficiency 

25 levels would be. 

26 MR. COFFEY: So there are none proposed 

27 right now. This is sort of a low-voltage dry-type 

28 analog of the network and vaults for liquids, where 
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1 the committee said, hey, these certain types of 

2 transformers may be especially disadvantaged, let’s 

3 get a group together and come up with the 

4 definition, and then request comments on the 

5 appropriateness of that, and how best to treat 

6 transformers. So we’re hoping that those that have 

7 knowledge and opinions on the subject will be able 

8 to submit some comments to help DOE reach a 

9 decision. 

10 MR. BROOKMAN: Andrew deLaski. 

11 MR. deLASKI: Just to follow on Steve’s 

12 comments. I mean it is hard to disentangle this 

13 question of these definitions and the levels. We 

14 discussed these definitions in the context of the 

15 negotiation. I think many of us were thinking that 

16 the proposal and the final standards may ultimately 

17 be higher than what are already contained in the 

18 proposal. And the definition may become unnecessary 

19 if the proposal ends up being as modest as the 

20 initial – the final ends up being as modest as the 

21 initial proposal. If we go to higher levels, such 

22 as we’ve recommended, then I think some of these 

23 definitions become necessary to test for the data 

24 centers and the vaults. 

25 MR. BROOKMAN: Okay. Thank you. Yes, 

26 John. 

27 MR. CASKEY: John Caskey, NEMA. I think 

28 actually we’re missing a significant point here, 
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1 both I think in issue nine as well as in issue ten. 

2 You’re asking for comment specifically how such 

3 transformers might be defined. I think the group 

4 working on the network and vault transformers did a 

5 good job of defining what they are as well as here, 

6 what’s for data centers. But the thing that’s not 

7 asked for, which I think is pretty critical, is how 

8 should they be treated relative to the proposed 

9 energy efficiency rating. So it’s both the 

10 definition and the treatment in terms of energy 

11 efficiency ratings. 

12 MR. BROOKMAN: Is that covered elsewhere? 

13 MR. COFFEY: No, I think that that 

14 information, any opinions, or data on how these 

15 transformers may be specifically affected would 

16 absolutely be helpful to DOE. 

17 MR. BROOKMAN: Thank you, John. 

18 Okay. Let’s keep going. 

19 MR. COFFEY: DOE also received comment 

20 that pole- and pad-mounted transformers, and a 

21 couple of folks in the room today have brought this 

22 up, may face different incremental cost behavior as 

23 efficiencies rise. Although not currently proposing 

24 to establish separate equipment classes for pole25 and pad-mounted units, DOE does request comment on 

26 whether those would be warranted. 

27 MR. BROOKMAN: Yes, please, John. 

28 MR. PHOUMINH: John Phouminh, PEPCO 
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1 Holding Inc. PHI supports the proposal to separate 

2 pole-mount versus pad-mount transformers. We have a 

3 situation where pole-mount is too big, especially 

4 the bigger size 333, 500 KVA. It’s just like a size 

5 of a Volkswagen on top of a pole, and that is not 

6 pleased with the customers, and we have to go a 

7 different route, which is more expensive, and of 

8 course, that cost being passed on to the customers. 

9 PHI supports the issue number 11. I will write it 

10 up to be sent to the DOE. 

11 MR. BROOKMAN: Thank you. Additional 

12 comments on pole versus pad. Bruce. 

13 MR. HIRSCH: Bruce Hirsh, Baltimore Gas 

14 and Electric. I’d like to reiterate that too, that 

15 the conditions under which we’ve got to mount pole16 mount transformers compared to pad-mounts are a lot 

17 different, and that affects – the efficiency of the 

18 transformer affects the size and the weights, and 

19 the size and the weights when you’ve got to hang it 

20 on a wood pole becomes a major problem for the 

21 utility industry and major cost to change out. And 

22 so I think that falls right in line with some of the 

23 other discussions that we’ve had. Andrew’s pointed 

24 out a lot of times we don’t want to hold up a whole 

25 class because of a certain grouping, and I think by 

26 separating them out, we could handle each class 

27 better that way. So we support it too. 

28 MR. BROOKMAN: Okay. Any additional 
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1 comments. Andrew. 

2 MR. deLASKI: So we certainly would be 

3 interested in seeing, as I said in my opening 

4 remarks, trial levels that reflect these classes. 

5 Now ultimately whether you – whether the analysis 

6 would support setting different standards is, I 

7 think, again a separate question. It has to be 

8 looked based on analysis, and we can’t conclude that 

9 until we see the separate analysis. And 

10 fortunately, DOE does have this analysis because 

11 they have done pads and poles separately in the 

12 analysis, and they set a standard which seems to be 

13 somehow an averaging of the two. So the proposed 

14 standard, for example, the design line 1, is a 3.3 

15 percent reduction in losses, whereas the EL-1, the 

16 level that many stakeholders supported, was an 8.7 

17 percent reduction in losses for that transformer. 

18 So I think getting to analysis that specifically 

19 addresses – or basing the standard on the analysis 

20 which has been done, I think makes totally good 

21 sense, and I think LBL and the Navigant team did a 

22 good job of coming up with analyses for – taking 

23 into account full cost, and that was something that 

24 was vetted, I think, pretty thoroughly during the 

25 negotiation, and that basing – coming up with 

26 appropriate levels for poles and pads would make 

27 good sense. And it’s also – I think one thing that 

28 I’ve noticed that you know a pole versus a pad, and 
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1 you’re not going to put a pad-mount transformer on a 

2 pole, so I don’t see a loophole problem here in 

3 defining these things and creating those classes 

4 should be well within the scope of what can be 

5 accomplished in the final rule. 

6 MR. BROOKMAN: Okay. Thank you. 

7 Additional comments on pole versus pad? I think 

8 maybe we should take a break at this point. The 

9 engineering analysis section has got a lot of 

10 content and may take a little bit of time. 

11 Looking ahead for the rest of the day, I 

12 figure – it’s now almost – we’re going to return 

13 here at five minutes to 11 to resume. Probably, 

14 when we return we’ll continue working at least to a 

15 late lunch, perhaps 12:30 or 12:45 or so, see how 

16 far we can get before we start to crater, and then 

17 we’ll see how far we get, but there’s a lot of 

18 content yet to be covered here, so I’m thinking 

19 we’re probably going to not reach the original end 

20 time as stated in the agenda, and no one wants to 

21 truncate your opportunity for comment. 

22 So those of you that are not familiar with 

23 the Forrestal Building? You need to wear this, it 

24 needs to be visible above your waist. There are 

25 rest rooms on both ends of the hall. There’s a 

26 coffee shop down on the ground floor that’s G, 

27 ground floor, just below us. So go to the elevator 

28 banks, go down and get it. Please go quickly, 15 
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1 minutes will fly by and they’re not very efficient 

2 down there at times, and we will resume at 10:55. 

3 And let me – this is a good start on the 

4 day, we’re getting some really good comment here. 

5 We’ll see you back here at 10:55. 

6 (Whereupon, at 10:40 a.m., the meeting was 

7 recessed for a 15-minute period.) 

8 MR. BROOKMAN: Okay. Let’s resume. Many 

9 of you have received a photocopy of the business 

10 cards of everybody who’s attending here today. 

11 That’s available, in the event you didn’t get hold 

12 of one, Brenda Edwards has them, and she’s handing 

13 them out, so that will be a copy of who all’s here. 

14 We left off with the engineering analysis, 

15 that’s where we’re going to resume, and back to 

16 Brian Coffey. Let’s start folks. Okay, Brian. 

17 Engineering Analysis 

18 MR. COFFEY: Yes, thank you. So this 

19 brings us to the engineering analysis wherein DOE 

20 analyzes the cost efficiency behavior of different 

21 types of transformers. Here are the liquid-immersed 

22 equipment classes one and two. I mentioned liquid23 immersed BIL ratings earlier and DOE is requesting 

24 comment on the possibility of establishing equipment 

25 classes by BIL rating for liquid-immersed as it 

26 currently does for medium-voltage dry-type units, 

27 and if so, on an appropriate methodology for doing 

28 so. 
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1 MR. BROOKMAN: So you can see the classes 

2 listed there. Comments on this method of rating and 

3 also the methodology? Phil. 

4 MR. HOPKINSON: Thank you. Phil 

5 Hopkinson, HVOLT, Inc. I think that – a couple of 

6 thoughts. One of them is that there is less of an 

7 impact for BIL in liquid-filled than there is in 

8 dry-type only because it takes a lot more separation 

9 between the windings to achieve a 125 BIL or 150 KV 

10 BIL in dry-types than it does to move up in liquid11 filleds from 95 to 125 to 150. So, depending on how 

12 far the efficiency gets pushed, it may be an issue. 

13 But if it’s a minor impact, then maybe not so 

14 important. 

15 MR. BROOKMAN: Okay. Comments related to 

16 using BIL ratings as the differentiator? No 

17 additional comments on this. Okay. 

18 MR. COFFEY: During the negotiation 

19 process, stakeholders discussed the appropriateness 

20 of certain design option combinations for certain 

21 design lines. As a result, DOE removed step-lap 

22 mitering as a core construction method for design 

23 line six which represents small single-phase low24 voltage dry-type units. It also added mitering cost 

25 for ordinary full mitering and for step-lap mitering 

26 to better reflect the added cost of manufacturing 

27 transformers in this way. Finally, DOE received 

28 comment that few, if any, transformers are built in 
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1 the United States using ZDMH steel, and as a result, 

2 DOE removed ZDMH from consideration in the base 

3 case. 

4 Here’s a table of – the first table of 

5 materials prices DOE uses in its analysis. I would 

6 point here that the economic results, so life-cycle 

7 cost, payback period, national impacts are based on 

8 an equal rating of the 2010 and 2011 materials price 

9 cases. 

10 So I won’t linger here for too long. You 

11 all have the prices. Here’s the second table. And 

12 DOE requests comment on these as they are in 

13 continuous fluctuation. 

14 MR. BROOKMAN: Yes, please, Ray. 

15 MR. POLINSKI: Ray Polinski, ATI16 Allegheny. I think it’s clearly on the record. You 

17 know, Brian, there was a lot of discussion about the 

18 M3 price for 2011 during our meetings, and it was 

19 clearly incorrect or whatever in 2011, so I just 

20 want to reiterate that. I think we actually – the 

21 transformer producers kind of did a little poll, the 

22 prices that they were paying, and the M3 price was 

23 very important price in the analysis. It was 

24 understated in 2011. 

25 MR. BROOKMAN: That’s in the record. 

26 Okay. Thank you. Steve Rosenstock. 

27 MR. ROSENSTOCK: Steve Rosenstock. A 

28 couple things. At one point there was data shown, 
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1 especially for transformers, I don’t know about 

2 materials, showing just the fluctuations. There was 

3 2006, 2008 and 2010, just kind of showing the wide 

4 range of what was happening, especially on the 

5 commodities market. And then later on in 

6 negotiations, it was just, oh, we’re going to – now 

7 we want to use 2011 prices for the analysis. I 

8 never really got a clear explanation about why DOE 

9 had to use 2011 prices and I did look through the 

10 slides, it’s not showing up, and I asked the 

11 question, well, to be analytically consistent, why 

12 aren’t you using 2011 power prices? I never 

13 received an answer for that either. It was like 

14 we’re going to take A of 2011, and some 2008 data, 

15 and we’re just going to extrapolate, then use the 

16 exact, most recent power prices which based on EIA, 

17 especially at the wholesale level which has an 

18 impact on transformer cost savings, were 

19 significantly lower in 2011 than 2010, the order of 

20 18 percent in the Pacific Northwest, and in other 

21 parts of the country, let me see, they show the 

22 percentage – EIA shows the percentage here, at least 

23 a good 10 or 15 percent. They don’t show the exact 

24 numbers here, unfortunately. Much, much lower than 

25 AEO 2011 would have indicated. So it’s kind of a 

26 bigger picture, but it seemed like there was a rush 

27 to say we have to use 2011 prices, even though you 

28 had this range from 2006 to 2010 on the materials 
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1 side, which affects the transformers, but in terms 

2 of on the cost savings side, well, we’ll just use 

3 the old projections and we’re not going to be as 

4 critical to use the 2011 power prices. That’s 

5 analytically inconsistent and I never received an 

6 answer for it. I hope to receive an answer for it 

7 at some point, but again, just very analytically 

8 inconsistent to say we’re going to try to use the 

9 most recent prices for one part of the analysis, 

10 we’re not going to worry about it for another part 

11 of the analysis. Thank you. 

12 MR. BROOKMAN: Mike Rivest. 

13 MR. RIVEST: Mike Rivest. I’m not going 

14 to speak for the Department, but I had a similar 

15 thought process going on that you just had. One 

16 thing that I thought about, which might make the 

17 inconsistency a little less inconsistent, is that in 

18 the case of the AEO, we’re talking about an update 

19 to a forecast, I believe. Whereas here we’re using 

20 existing prices as a proxy for a future price. And 

21 so this 2011 price is the price of steel in 2011. 

22 It’s no one’s forecast. It’s no one’s 2011 forecast 

23 for 2015 of the price of steel. So that’s the 

24 difference, and by averaging two years, maybe it’s a 

25 more robust range of pricing, if you will, of what 

26 might happen in 2011. And it is consistent to what 

27 was done in the previous rulemaking where it was the 

28 averaging of five years. 
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1 MR. ROSENSTOCK: Steve Rosenstock, EEI. I 

2 appreciate that and have just – it seemed like I 

3 thought they were going to use an averaging of five 

4 years, 2006, 2008, 2010, and the impression that I 

5 got, and if I was wrong, please, please correct me 

6 and please forgive me as well, that no, we’re going 

7 to try to use the 2011 prices as the starting point 

8 and then extrapolate, and then use that for the 

9 future projections, the future analysis. 

10 MR. RIVEST: I remember hearing that. I 

11 didn’t say that, though, but I remember hearing 

12 that. 

13 MR. ROSENSTOCK: So, again, and my point 

14 is, if you’re so intent on using 2011 material 

15 prices then extrapolating it, forecasting, why not 

16 use the 2011 power prices? That’s my – that was my 

17 question, just in terms of just an analytical 

18 consistency, because there was significant drop in 

19 power prices in many parts of the country that AEO 

20 2011 did not pick up, so it just seems rather 

21 inconsistent to use one but not the other. 

22 MR. BROOKMAN: Let’s see if we have any 

23 additional comment. Mike, you have anything 

24 additional to say. 

25 MR. RIVEST: Well, maybe the misstatement 

26 was the previous statement about consistency being 

27 using 2011 prices of steel being consistent with 

28 using AEO 2011 forecasts for 2015, maybe that was 
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1 the inconsistency, and not what we did this time. 

2 MR. BROOKMAN: Katie Coughlin. 

3 MR. RIVEST: And why we didn’t use five4 year steel prices, I just don’t think we had five 

5 years of steel prices. 

6 MR. BROOKMAN: Katie Coughlin has joined 

7 us here. Go ahead. 

8 MS. COUGHLIN: Yes, this is Katie 

9 Coughlin, Lawrence Berkeley Lab. I want to clarify 

10 something. The reason why we need – okay, so the 

11 LCC, the purchase price increase is an up-front cost 

12 that occurs in the sort of first year of the LCC. 

13 And then the payback occurs over the forecast 

14 period, so the LCC requires essentially an 

15 evaluation of the cost of the unit in one year, and 

16 then a forecast of energy prices over up to 30 to 40 

17 years. That’s why we need to use AEO forecast data 

18 to get the LCC. And as far as updating the base 

19 year electricity prices, analytically, it actually 

20 doesn’t make any difference because everything has 

21 to be scaled to the current version of the AEO in 

22 order to give us a consistent data set across all of 

23 the years of the analysis period, and all of the 

24 regions that we’re using in the analysis, sort of 

25 spatial breakdown. But there’s no analytical 

26 inconsistency because the purchase price is just a 

27 one year increase, it’s not projected over time. 

28 MR. BROOKMAN: Steve. 
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1 MR. ROSENSTOCK: Steve Rosenstock, EEI. 

2 Well, that purchase price, though, that will have an 

3 impact on incremental cost which has an impact on 

4 the life-cycle cost analysis, so if it changes 

5 dramatically as some of these numbers do between 

6 2010 and 2011, that could have a significant impact 

7 on the incremental cost which spills over into the 

8 savings and the economic paybacks, as well as the 

9 net present values. And in terms of some of the 

10 power prices, I understand that you’re projecting 

11 over 40 years, but depending on where you start, 

12 that could have a huge difference. If you’re 

13 starting at a level that’s 20 percent higher at the 

14 beginning, that’s going to have an impact over the 

15 30 years if you’re using the same projection 

16 pattern. 

17 MR. BROOKMAN: Okay, Steve. 

18 MR. ROSENSTOCK: Thank you. 

19 MR. BROOKMAN: Thank you. Greg – oh, Bob. 

20 MR. SAINT: Bob Saint, NRECA. So, as a 

21 result of all these numbers we’re using, we’re using 

22 steel prices 2011, which are artificially low or 

23 historically low because the demand for transformers 

24 is down because of the economy. And in the last 

25 negotiations in 2007, we were all concerned about 

26 the cost of steel is going crazy, availability is 

27 still six months, eight months, a year out – that’s 

28 not the case in 2011. Cost of steel is down, 
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1 availability is up, so yeah, we’re using the 2000 

2 data for steel costs, so we use – on the other hand, 

3 we’re using artificially high prices for the cost of 

4 power, sometimes two, three times more than we’re 

5 paying currently for wholesale power. So as a 

6 result, the analysis shows the total owning cost 

7 because of the cost of materials is low, the cost of 

8 power is high, it shows a total owning cost, more 

9 than we think it should be. So, these cost 

10 analysis, total owning cost, the payback periods – 

11 we’re not comfortable with the analysis, so we’re 

12 taking those numbers with a grain of salt, because 

13 of the method that were used for the cost of 

14 materials, lower than we think they should be, cost 

15 of power, higher than we think they should be, so 

16 the results are – we’re not comfortable with those 

17 results. 

18 MR. BROOKMAN: This is the kind of 

19 analysis – your analysis, everyone’s analysis that 

20 the Department would really like in great detail. 

21 So I’m hoping everybody understands that at the 

22 table. Your opportunity to set the record straight. 

23 MR. SAINT: And we have been working with 

24 the consultants, and we will continue to work with 

25 the consultants. 

26 MR. BROOKMAN: Okay. Great. Which is not 

27 to diminish the opportunity to comment as fully as 

28 possible right now. Any additional comments on this 
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1 subject before we move on? Okay. Okay. 

2 MR. COFFEY: So now just to talk quickly 

3 about scaling, DOE set standards for all KVAs by 

4 analyzing 14 design lines and then scaling the 

5 results from those to all KVA ratings within its 

6 scope of coverage. Previously, DOE had scaled 

7 losses by KVA using an exponent of .75 which is a 

8 theoretically derived result and which it had heard, 

9 was generally good. DOE had received a number of 

10 comments, however, that depending on transformer 

11 type, the true behavior can deviate slightly from 

12 .75, and that fixing the scaling exponent may result 

13 in a standard that is far more stringent at certain 

14 KVA ratings than others. And so for the NOPR, DOE 

15 allowed the exponent to float to align with the 

16 selected ELs. 

17 So here are the scaling exponents used for 

18 the ten equipment classes. They range from, I 

19 guess, a low of .67 to a high of .79, so not 

20 radically different, but it’s a slight adjustment 

21 that we wanted to note. 

22 MR. BROOKMAN: Greg. 

23 MR. COULTER: This is Greg Coulter, 

24 Prolec-GE. Brian, the scaling exponent, we 

25 understand why you’re using it. It’s a crude 

26 methodology to come across for great variations in 

27 KVA. Experience in transformer design says it only 

28 works well across short distances of KVA because you 
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1 get into many other design concerns. For instance, 

2 high KVA, three-phase pad have to meet a 5.75 

3 percent impedance. You don’t get a smooth scaling 

4 like this across the higher KVAs. You may not get a 

5 smooth scaling across even single-phase poles or 

6 single-phase pads. This works across a small range 

7 of KVAs, across small range, those differences don’t 

8 mean much either. So, we think it’s important to 

9 look across the bigger, broader KVA. You might be 

10 able to use the high KVA three-phase, you might be 

11 able to find a scaling factor that works across all 

12 the high KVAs, and another one that works across the 

13 low KVAs. We’re concerned that you even use a 

14 technical way to come up with this versus a curved 

15 fit after the fact to meet your numbers. It wasn’t 

16 clear to me from your explanation. This may not be 

17 the best way. That said, our company generally uses 

18 stuff between .75 and .8, so I can’t argue too much 

19 with the numbers, we just think it doesn’t work 

20 across big KVAs swings. 

21 MR. BROOKMAN: Okay. Thank you. 

22 Additional comments on these scaling exponents? 

23 Yes, Phil. 

24 MR. HOPKINSON: Phil Hopkinson, HVOLT. 

25 I’m not saying it’s wrong, but I am very curious 

26 that the dry-types seem to be the ones that have 

27 particularly low factors – so the .67, I really 

28 don’t know what drives that. Having been a veteran 
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1 of the use of the three-quarter power and even for 

2 dry-types, so I don’t know. It may be correct, I 

3 just haven’t looked carefully enough at it. 

4 MR. COFFEY: I think that comes mostly 

5 from the fact that the committee – so in medium6 voltage dry, the committee reached a consensus, and 

7 the consensus that it reached had a lower EL for the 

8 lower KVA models than for the higher ones, and so 

9 the scaling behavior that reflects that decision is 

10 going to be a little bit lower than .75. 

11 MR. BROOKMAN: Thanks, Brian. 

12 MR. COFFEY: And so here are the formal 

13 request for comment for what we just talked about, 

14 and also for the fact that in addition to scaling 

15 within an equipment class, DOE is faced with 

16 determining how single and three-phase transformers 

17 – single and three-phase equipment class of the same 

18 transformer type rather, should be related. And so 

19 the request for comment is on how best to scale 

20 across phase counts for each transformer type and 

21 how standards for either single or three-phase 

22 transformers may be derived from the other type. 

23 And the second comment box is on the previous slide, 

24 on the scaling exponents. 

25 MR. BROOKMAN: Perhaps we’ve covered 14. 

26 What about 13? Phil. 

27 MR. HOPKINSON: Phil Hopkinson, HVOLT. I 

28 think really the only way that you’ll truly know 
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1 what the answer is, is to request a whole lot more 

2 data and then curve-fit it, and then you’ll know, 

3 but I think that you don’t have really time to do 

4 it, so at this point we really cannot truly refine 

5 anything, I think, logically. 

6 MR. BROOKMAN: Greg. 

7 MR. COULTER: Greg Coulter, Prolec-GE. I’m 

8 not positive there’s any reason to scale single9 phase to three-phase. Scale them separately. There 

10 is no good single- to three-phase scale. Just don’t 

11 bother with it. 

12 MR. BROOKMAN: ‘Cause there’s so much 

13 variation? 

14 MR. COULTER: Exactly. 

15 MR. BROOKMAN: Additional comments on how 

16 you would handle single, two-, three-phase? Okay. 

17 MR. COFFEY: So there’s some additional 

18 engineering design constraints that manufacturers 

19 face. I’ll read these comment boxes. 

20 DOE request comment on the current and 

21 future availabilities of high grade steels, 

22 particularly amorphous and mechanically scribed 

23 steels in the United States. 

24 Issue 20, DOE requests comment on its 

25 steel supply availability analysis presented in 

26 Appendix 3A of the technical support document. 

27 MR. BROOKMAN: Ray. 

28 MR. POLINSKI: Ray Polinski, ATI-
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1 Allegheny. Once again, Brian, I think it was agreed 

2 by the entire committee that mechanically scribed 

3 material was of very limited availability. Capacity 

4 to produce, import producers, and nothing’s 

5 available in the United States, so that product, I 

6 think, was not going to be considered in the 

7 analysis from my recollection. 

8 MR. BROOKMAN: Thank you. Please say 

9 your name. 

10 MR. RYAN: Paul Ryan, Hitachi Metglas. 

11 We, Metglas, made it a letter on record to DOE 

12 regarding issue 18. So I just want to reconfirm that 

13 that’s on the record. It wasn’t included in the 

14 packet, but there is a letter to DOE. 

15 MR. BROOKMAN: Do you want to summarize 

16 that now or – 

17 MR RYAN: Well, essentially it says that 

18 there is enough capacity to support the marketplace 

19 and depending on where the final rule ends, we would 

20 accommodate the marketplace in capacity. Those 

21 comments were made during the proceedings as well. 

22 MR. BROOKMAN: Ami Grace-Tardy. 

23 MS. GRACE-TARDY: Yes, we do have that 

24 letter. 

25 MR. RYAN: Okay. Thank you. 

26 MS. GRACE-TARDY: It will be included in 

27 the docket. 

28 MR. RYAN: Thank you. 
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1 MR. BROOKMAN: Thank you, Ami. Any 

2 additional comment on these issues related to the 

3 availability and also price, right – 

4 MR. COFFEY: Availability. 

5 MR. BROOKMAN: Please, Andrew. 

6 MR. deLASKI: I’m having a little trouble 

7 with disaggregating the conversation with respect to 

8 low-voltage dries and liquid-immersed. So these 

9 questions are with respect to both equipment super 

10 classes? 

11 MR. COFFEY: Yes, they’re general I think. 

12 The high grade steels have been more of a concern in 

13 the liquid-immersed phase than the low-voltage dry. 

14 MR. deLASKI: I just think that one of the 

15 things that we have to keep in mind in considering 

16 the difference of the two is that the low-voltage 

17 dries, as the Department’s analysis shows, 75 

18 percent of the volume is manufactured in Mexico. 

19 And some of the constraints on core materials are 

20 not the same for those transformers are they are for 

21 parts that are primarily manufactured in the United 

22 States, so let’s be careful that we consider those 

23 low-voltage dry market and liquid-immersed markets 

24 should be considered separately. 

25 MR. BROOKMAN: Okay. Other comments on 

26 these two issue boxes? They’re referring to 

27 Appendix 3A if you want to take a peek there. Okay. 

28 MR. COFFEY: And here’s one last 
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1 constraint, and this may have been partially if not 

2 wholly addressed by the discussion on network and 

3 vault transformers and on separating pads and poles 

4 earlier, but as a catch-all, DOE requests comment on 

5 particular applications in which transformer size 

6 and weight are likely to be a constraint, and any 

7 data that may be used to characterize the problem. 

8 MR. BROOKMAN: We’ve had a little bit of 

9 comment on this already this morning. Steve 

10 Rosenstock. 

11 MR. ROSENSTOCK: Steve Rosenstock, EEI. 

12 Just as a reiteration that member companies of all 

13 trade associations and the Association [...] have 

14 submitted data to DOE on this issue and providing 

15 real world examples of the actual impacts and costs, 

16 and hopefully that information that we submitted 

17 will be used in your – in the final rulemaking. 

18 Thank you. 

19 MR. BROOKMAN: Thank you. Other comments? 

20 No additional comments. Okay. 

21 MR. COFFEY: This brings us to markups and 

22 energy use and now I’ll invite up Chris Bolduc – or 

23 Katie Coughlin, actually, I’m sorry. 

24 Markups, Loading, Distribution Channels 

25 MS. COUGHLIN: I’m Katie Coughlin, 

26 Lawrence Berkeley Lab. It’s good to see you all 

27 again. So I’m going to review very briefly the 

28 markets and energy use, life-cycle cost, and 
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1 shipments and NIA, and we’ll be recapping only those 

2 subjects where the Department has already received 

3 comments which were extensively discussed during the 

4 stakeholder – the negotiation, but you’re of course 

5 free to comment on any aspect of the analysis, but I 

6 will be highlighting a few issues. 

7 So to begin with, the markups and loading 

8 – for the loading analysis, the issue here is always 

9 getting more data, so we have two separate load 

10 models, one for the liquid-immersed and one for the 

11 dry-type. The liquid-immersed we were trying to do 

12 two things. We were trying to capture the 

13 correlation between variable hourly prices and 

14 variable loads on the transformer, and that was done 

15 with a two-stage model. We used Form 714 data to 

16 capture the shape of the price-load curve. Price as 

17 a function of system load, and then we used a 

18 statistical model based on hourly meter data to try 

19 to represent the statistical relationship between 

20 the transformer hourly load and the system hourly 

21 load. 

22 We did receive some data from the 

23 stakeholders. Overall our findings of the data was 

24 consistent with what we have, the biggest drawback 

25 is that the transformer data that we received is 

26 almost exclusively for low capacity, so units with 

27 KVA of 50 or below. So it would be somewhat 

28 difficult to verify or to extrapolate that to higher 
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1 capacities. For dry-type transformers we used CBECS 

2 building data to estimate load-factors shapes month 

3 by month for the transformer population, and again, 

4 we used hourly metered building data to develop a 

5 model that relates the monthly load factor to the 

6 parameters that determine transformer loading. 

7 So DOE seeks comment on any additional 

8 sources of distribution transformer load data that 

9 could be used to validate the energy use and load 

10 characterization analysis. And as I mentioned, we 

11 are particularly in need of data for higher capacity 

12 and three-phase units. 

13 MR. BROOKMAN: Additional data sources. 

14 Phil. 

15 MR. HOPKINSON: Katie, very interesting. 

16 One source of data that frankly I have, when I was 

17 working for Square D, we looked at all of the low18 voltage dry-type transformers in the DOE building 

19 right here, the Forrestal building, and that data is 

20 public record. Be glad to send it to you if you 

21 don’t have that, but that was the basis of coming up 

22 with, for example, with the 35 percent equivalent 

23 load for low-voltage dries. 

24 MR. BROOKMAN: Okay. Thank you. So this 

25 is always a quest, trying to find this data. Any 

26 additional sources? 

27 MS. COUGHLIN: So the next issue is the 

28 markups. So these are the markups that occur after 
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1 the unit leaves the manufacturer in the distribution 

2 channel. So we have again, since we have two 

3 broadly different types of products, we have two 

4 different distribution channels. For the liquid5 immersed transformers, the Department is currently 

6 using a model in which it’s assumed that the 

7 majority of transformers are purchased directly from 

8 the manufacturer, so that there is no distributor 

9 markup. And to estimate the number of purchasers 

10 who purchase directly, we used data from EIA and 

11 essentially we have a cutoff on the size of the 

12 utility. For smaller utilities the assumption is 

13 that there may be a distributor and therefore there 

14 will be a distributor markup. So the – under the 

15 current parameters, about 80 percent of liquid16 immersed transformers are purchased directly from 

17 the manufacturer with no distributor markup. For 

18 dry-type transformers, they are primarily purchased 

19 and installed by electrical contractors, and so 

20 there are a variety of markups that are applied in 

21 that distribution channel. 

22 So the table shows the two sets of 

23 markups, what are the two types of products. In the 

24 dry-type the values in parentheses correspond to the 

25 low voltage and the other values correspond to the 

26 medium voltage. Overall the markups on liquid27 immersed is about 1.54 if it’s purchased directly 

28 from a manufacturer, and 1.61 if it’s purchased 
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1 through a distributor. The markups on dry-types are 

2 1.96 for medium voltage, and 1.79 for low voltage.So 

3 DOE – 

4 MR. BROOKMAN: Steve Rosenstock. 

5 MR. ROSENSTOCK: Steve Rosenstock, EEI. I 

6 know in other rulemakings you kind of carved out for 

7 a commercial product where there’s a multi-site or 

8 what we call a national account customer and some of 

9 them are also not using distributors as well. And 

10 there could be a percentage of the units, just like 

11 other products, I’d say lighting products or heating 

12 or cooling products, where they’re also kind of 

13 going directly to the manufacturer because they have 

14 a multisite account with the manufacturer. 

15 MS. COUGHLIN: This is for building 

16 operators. 

17 MR. ROSENSTOCK: Yeah. 

18 MS. COUGHLIN: Yes. Okay. 

19 MR. ROSENSTOCK: It has been used in other 

20 rulemakings as I recall. Off the top of my head, I 

21 can’t remember exactly which one, but there might be 

22 similar percentages for those type of customers and 

23 that might have an impact on some of these as well. 

24 Again, I can’t remember the exact specific 

25 commercial rulemaking, it might have been like – 

26 actually it might have been lighting actually, that 

27 there was research done by DOE in terms of how many 

28 of them were again direct manufacturer sales to 
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1 them. 

2 MS. COUGHLIN: Okay. 

3 MR. BROOKMAN: So these kind or markups 

4 can be difficult to disclose at times, but comment 

5 from anyone surrounding what you see here? Yes, 

6 please, Bruce. 

7 MR. HIRSCH: Yes, Bruce Hirsch, Baltimore 

8 Gas and Electric. As an investor-owned utility who 

9 buys a fair amount of transformers a year, I guess I 

10 would like to point out that even though we may deal 

11 very closely with manufacturers, a lot of time the 

12 manufacture have a local rep that takes care of all 

13 the issues and problems. So when you say that most 

14 are bought directly from the manufacturers, I’m not 

15 sure that’s completely true. I don’t know what the 

16 numbers are right now but I’ll go back and look at a 

17 typical utility, like Baltimore Gas and Electric and 

18 see what I can provide to you. 

19 MR. BROOKMAN: There’s something of an 

20 intermediary there. 

21 MR. HIRSCH: Right. 

22 MR. BROOKMAN: Okay. Yes, Phil. 

23 MR. HOPKINSON: Phil Hopkinson, HVOLT. 

24 The only question that I have, Katie, is as opposed 

25 to the cost of purchasing the transformer, you 

26 actually have the cost of installation, and it would 

27 imply that you’re going to take a transformer out 

28 and replace it with another transformer in order to 
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1 make this comparison, and I wasn’t aware that you 

2 were actually going to do that kind of work. 

3 MS. COUGHLIN: I’m not sure I understand 

4 the question. 

5 MR. BROOKMAN: I didn’t either, Phil. 

6 MR. HOPKINSON: Okay. Well, let me try 

7 that again. So that if we look at a transformer 

8 that’s already providing service to a location, and 

9 we then consider what it might take to get a new 

10 transformer that would be more energy efficient and 

11 put it in the same spot, then it would seem to be 

12 important to have all of the in and out costs it 

13 would take to get the new one functionally doing the 

14 work of the old one. But if we’re only looking at 

15 the two representative new transformers, sold to an 

16 end location, then the installation cost wouldn’t 

17 seem to be important, only the purchase cost. So I 

18 was scratching my head as to why you show the cost 

19 of installation in this markup. Or am I incorrect? 

20 Because you have the installation labor. 

21 MR. ROSENSTOCK: Steve Rosenstock, EEI. 

22 Even in this situation there’s still going to be 

23 some sort of extra cost for the actual installation 

24 and labor, isn’t there? 

25 MR. HOPKINSON: Well, there is, but I’m 

26 making the presumption that we are not removing a 

27 transformer and replacing it with another, but 

28 simply we have a new service, and we have a choice 
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1 of two transformers to go into the service, one of 

2 them being more energy efficient than the other. So 

3 it wouldn’t matter what the installation cost in 

4 that particular case was. 

5 MS. COUGHLIN: You’re right. In the LCC 

6 what is compared is the base case which includes 

7 installation, and the standards case which includes 

8 installation. So we are netting out the base case 

9 installation cost. 

10 MR. HOPKINSON: I see. 

11 MS. COUGHLIN: So this is just a record of 

12 the way the costs have been tabulated. 

13 MR. HOPKINSON: Okay. Thank you. 

14 MR. ROSENSTOCK: Steve Rosenstock, EEI. 

15 In the analysis, they’re assuming that certain 

16 percentage is replacement, in their analysis 

17 

18 MR. HOPKINSON: But you still, even if it 

19 was replacement, then it wouldn’t – you would still 

20 have the in and out cost, whether it was more 

21 efficient or not. 

22 MR. BROOKMAN: Mike Rivest. 

23 MR. RIVEST: Mike Rivest. In some 

24 situations, if it’s a heavier transformer, I assume 

25 that the installation cost actually goes up. 

26 MS. COUGHLIN: Yes, so – 

27 MR. HOPKINSON: I see. 

28 MR. RIVEST: So it doesn’t always net out. 
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1 MR. HOPKINSON: So then you consider it. 

2 I understand. 

3 MR. BROOKMAN: Okay. Yes, we’re moving 

4 on. 

5 MS. COUGHLIN: Pole replacement. So 

6 again, we had a good deal of discussion of this in 

7 the negotiations. This issue is specific to design 

8 line two which is the only representative unit that 

9 is installed on poles, and the issue arises because 

10 more efficient transformers can be significantly 

11 heavier than the base case unit, and that may 

12 necessitate early replacement of the pole. So the 

13 current model assumes that the pole will be replaced 

14 when either the transformer is 150 pounds or 15 

15 percent heavier than the unit that would be chosen 

16 in the base case. And we currently cap the pole 

17 replacement at 25 percent of the population in the 

18 LCC. 

19 Replacement costs were developed with 

20 reference to RS Means construction data that 

21 includes costs of removing pole, and labor, and the 

22 amount of labor will depend on the size of the 

23 transformer, whether you need one-, two-, three-man 

24 crews, et cetera. So we have a broad range of 

25 costs, bounded by about $2-6,000. And we also use a 

26 – since the poles typically have a lifetime of on 

27 the order of 30 to 40 years, we actually have what 

28 is essentially an early replacement cost associated 
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1 with the poles. So we don’t – we assume that the 

2 pole has already been in the field for some number 

3 of years before it’s replaced. 

4 So with this methodology, DOE continues to 

5 seek comment on any data or advice that could 

6 improve the implementation of this methodology. 

7 MR. BROOKMAN: Steve Rosenstock. 

8 MR. ROSENSTOCK: Steve Rosenstock, EEI. I 

9 like the methodology, but I remember especially from 

10 PEPCO saying it wasn’t necessarily the weight 

11 increase, it was just the fact if you went, I think 

12 the number was over 900 pounds, that even if there 

13 wasn’t a replacement, there was a whole host of 

14 things that they had to do extra because of that 

15 weight issue. 

16 MR. PHOUMINH: John Phouminh, PEPCO 

17 Holding, Inc. In certain service territory of our 

18 area which is on ACE [Atlantic City Electric], we 

19 have a union contract. If the pole weight is more 

20 than 900 pounds – I’m sorry, if the transformer 

21 weight is more than 900 pounds, we’re required to 

22 have at least two-men crew, which is total, four 

23 people, as well as the arrow board, the traffic 

24 signal. It’s not as exactly putting your pole. 

25 It’s more involved to it. Of course the pole has to 

26 be big, and it’s not only one pole, it will be two 

27 poles stands next to each other and put a ... the 

28 rail the size of this table next to it, and that 
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1 final KVA transformer pole, pole-type transformer is 

2 weight about 3,000 pounds, probably give or take. 

3 That will be three of them, that’s 10,000 pounds. 

4 That’s a lot of weight. 

5 From PHI perspective, we would like to 

6 keep it the way it is, especially the larger size of 

7 the pole-type transformers, because anything big – 

8 it won’t be big up there and it will be a sore to 

9 the eye and the public will be up in arms against 

10 it. Of course, you know, and this is one of the 

11 things that we’d like to separate between the pole12 type and the pad-mount, we’d like to – we want to 

13 propose to DOE to consider that approach. 

14 MR. BROOKMAN: Okay. Steve Rosenstock. 

15 MR. ROSENSTOCK: And again, another issue 

16 that Bruce brought up to me was the fact that, 

17 especially in urban areas, it’s not necessarily – 

18 the pole might not be replaced, but then there’s the 

19 actual – the collocation of other utility equipment 

20 on that pole, whether it’s cable or telephone or 

21 internet or whatever, that you have to move those 

22 services as well. There could be extra cost for 

23 that that may or may not be represented in the 

24 analysis. So again, I don’t know, Bruce, if you 

25 have some thoughts about that, but again, it’s not a 

26 replacement issue, it’s simply a pole issue that can 

27 have an impact, especially if you’re changing the 

28 size of the transformer. 
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1 MR. BROOKMAN: Bruce. 

2 MR. HIRSCH: Just to follow up with 

3 Steve’s. It’s not just the weight, but the size 

4 also becomes a problem. If we’ve got to fit it in, 

5 especially in a replacement case, to an existing 

6 system like Steve said, there’s other utilities 

7 there, but also we have clearance issues that arise, 

8 and that’s a safety problem, and that’s all covered 

9 by the National Electric Safety Code. So all of 

10 these things lead to issues and problems that we 

11 have in the utility trying to utilize overhead 

12 transformers that are heavier and larger. So those 

13 are issues, and we’ve talked about them before, so I 

14 suspect you’ve factored some of this in. 

15 MR. BROOKMAN: Other comments on the 

16 methodology described here? 

17 MR. ROSENSTOCK: I guess my only other 

18 comment – sorry, Mr. Brookman – the only other 

19 comment is you kind of have it capped at $6,000 in 

20 terms of your distribution, I don’t know if that’s 

21 too low or not. It might be too low, especially for 

22 some of the situations you just heard about. Again, 

23 I don’t have the actual data, but there might be – 

24 especially in urban areas, that $6,000 could be 

25 significantly low, especially for the larger 

26 transformers. 

27 MR. BROOKMAN: So to receive those 

28 comments from you in writing, the Department would 
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1 really appreciate that. 

2 MS. COUGHLIN: Let me just comment that 

3 that is for design line two, which is I believe 50 

4 KVA, and then we scale those costs upward for larger 

5 capacity units. 

6 Life Cycle Costs and Payback Period Analysis 

7 Okay, so moving on to life-cycle cost. 

8 The Department issue that remains open on this is 

9 the number of purchasers of transformers – this is 

10 really for liquid-immersed transformers, whether 

11 they are evaluators as they have come to be called. 

12 So the model of the LCC assumes that some fraction 

13 of purchasers evaluate the losses of the transformer 

14 and express to the manufacturer a preference for 

15 more efficiency. So the no-load losses are valued by 

16 a parameter that’s called A, and load losses are 

17 valued by a parameter referred to as B. And the 

18 Department has survey data for A and B values and – 

19 so in the model, if a purchaser is an evaluator and 

20 A and B values are selected, and then there’s the 

21 possibility that the purchaser will choose in the 

22 base case a high-efficiency unit. And if that’s the 

23 case, then, this purchaser is essentially unaffected 

24 by the standard. So these rates of evaluation will 

25 affect the net benefit associated with the trial 

26 standard level and the effects are carried through 

27 into downstream analyses. 

28 So we initially started, and I believe the 
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1 2005 rule used relatively high rates of evaluation, 

2 but based on comment from the negotiation process, 

3 we’ve changed these evaluation rates so that they’re 

4 in the table below. So for liquid-immersed, the 

5 default is the ten percent of purchasers are 

6 evaluating, and for the dry type, based on comment, 

7 we lowered the number of evaluators. It’s not zero, 

8 but it’s pretty close to zero. 

9 So DOE is soliciting any further comment 

10 on these evaluation rates. 

11 MR. BROOKMAN: Phil. 

12 MR. HOPKINSON: Phil Hopkinson, HVOLT. 

13 I’m not certain that I understand what you said 

14 there, Katie, and so on the default for liquid15 immersed, you show ten percent – does that mean ten 

16 percent of the purchasers go to those who take the 

17 default efficiency, and – 

18 MS. COUGHLIN: No, the default refers to 

19 the default scenario that’s in the tables. 

20 MR. HOPKINSON: I see. 

21 MS. COUGHLIN: At TSD, and then you have 

22 an appendix of sensitivity cases, and there are 

23 sensitivities for no evaluators and 100 percent 

24 evaluators. 

25 MR. HOPKINSON: Okay. I understand. 

26 MR. BROOKMAN: Chuck. Please use the 

27 microphone. 

28 MR. FOSTER: Chuck Foster, EEI. Katie, 
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1 I’m going to follow up on Phil’s question. I just 

2 want to make sure I understand this. Is that – 

3 looking at design lines one through five, the 

4 assumption built into the – into your analysis then 

5 is that ten percent of the purchasers actually do an 

6 analysis are evaluators. 

7 MS. COUGHLIN: That’s right. 

8 MR. FOSTER: I think that’s too low. I 

9 think that – I think that that’s too low, but we’ll 

10 submit a comment on it. 

11 MR. BROOKMAN: Andrew deLaski. 

12 MR. deLASKI: And one thing that came out 

13 in the negotiation is that just because you 

14 evaluate, you can evaluate and still buy the minimum 

15 transformer on the market. 

16 MS. COUGHLIN: That is correct. Yes, or 

17 you can evaluate and still be below the TSL. 

18 MR. deLASKI: Right. 

19 MS. COUGHLIN: So this may have not a 

20 large impact, especially for the higher proposed 

21 trial standard levels, the evaluation rate becomes 

22 less and less relevant. 

23 MR. deLASKI: Right. Think of utilities 

24 that are using [...] equivalents to make their 

25 decision, you see them defaulting to whatever is the 

26 minimum cost transformer on the market. 

27 MS. COUGHLIN: Correct. 

28 MR. BROOKMAN: Bruce. 
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1 MR. HIRSCH: Bruce Hirsh, Baltimore Gas 

2 and Electric. I’ve done some surveys of utilities, 

3 so I’ve got some numbers I can pass on. I think I 

4 may have passed them on already to you, but I’ll get 

5 them back to you. The one point I would make with 

6 this, though, was that I think what you’re finding 

7 is that prior to 1910 more people evaluated than 

8 they are now because their evaluations may have come 

9 in under the DOE required numbers, so if that’s 

10 happening, then what happens is they’re not 

11 necessarily evaluating. Some utilities are still 

12 evaluating, but actually buying the DOE numbers 

13 because they are higher than some of the evaluations 

14 that are coming out, so it’s a moving number is what 

15 I can say. But I’ll get you some numbers that I 

16 have. 

17 MR. BROOKMAN: Okay. Bob. 

18 MR. SAINT: Bob Saint– I was going to say 

19 almost the same thing that you were saying Bruce, in 

20 that with these higher efficient transformers that 

21 we’re required to purchase now, I think fewer 

22 people, especially the small utilities are 

23 evaluating. But that’s really a misnomer, because 

24 we will encourage everybody to evaluate transformers 

25 because the standard is based on 50 percent loading, 

26 the testing and loading, and if you use a different 

27 A and B factor, you can get a different transformer 

28 that is more efficient for the way you load the 
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1 transformer, and it still may meet the 50 percent 

2 loading percentage, but it has a different A and B, 

3 no load or load loss. So really encourage folks to 

4 evaluate transformers to get the most efficient, 

5 most cost-effective transformer that they could. 

6 So, ten percent – it’s hard to tell how many are 

7 evaluating. We do know that we think more folks 

8 should be evaluating. But it’s really not an easy 

9 process, especially for a small company that doesn’t 

10 have the resources to do the analysis. 

11 MR. BROOKMAN: Okay. Final comments. 

12 Shipments, National impact analysis, Refurbishments 

13 MS. COUGHLIN: So for the shipments and 

14 national impacts analysis, the issue here is the 

15 refurbishments. So first of all, let me make a 

16 couple clarifying comments. We distinguish in our 

17 language between refurbishments, which is sort of 

18 general maintenance that may extend the life of the 

19 unit, and a rewind which is where you actually, 

20 instead of replacing a unit that’s out of service, 

21 you take it apart and rebuild it using the old core. 

22 And both types of extended – lifetime extending 

23 repairs can be modeled in the national impacts 

24 analysis. So we don’t have a problem with 

25 implementing that type of model, but at the moment 

26 we don’t have any data that gives us the criteria 

27 that we need to put into the model. 

28 So DOE is seeking comment on what are the 
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1 economic criteria that a utility purchaser would use 

2 in deciding to rewind a transformer rather than 

3 purchase a new unit, and the second issue is, what 

4 are the – what is the expected lifetime of a rewound 

5 unit if it might differ from the lifetime of a new 

6 unit? And would there be other types of changes to 

7 maintenance practices that could extend transformer 

8 lifetimes beyond the lifetime that is currently 

9 typical? 

10 MR. BROOKMAN: Yes, Please. 

11 MR. BERMAN: Robert Berman, Berman 

12 Economics. Katie has DOE done any analysis as to 

13 what – how many transformers, what percentage of 

14 transformers in different categories are rewound now 

15 or how transformer rewinds have changed, say between 

16 2007 and 2010? Do you have any data? 

17 MS. COUGHLIN: We have no data. 

18 MR. BERMAN: You have no data at all? 

19 MS. COUGHLIN: No. 

20 MR. BERMAN: Thank you. 

21 MR. BROOKMAN: Phil. 

22 MR. HOPKINSON: Phil Hopkinson, HVOLT. 

23 What I would say about the rewinds and life is it 

24 depends on the rewinder. If we have an equivalent 

25 manufacturer to the original manufacturer, who is a 

26 high quality transformer producer, I would expect a 

27 life comparable to a brand new transformer. On the 

28 other hand, if we have one made by a Joe down the 
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1 street, then I would always be suspect as to what 

2 Joe used. 

3 MR. BROOKMAN: And would you comment on 

4 maintenance practices? 

5 MR. HOPKINSON: Maintenance practices, my 

6 impression is certainly most small transformers 

7 don’t get any maintenance other than when the 

8 transformer is cleaned up. So let’s say we took a 

9 transformer in to rewind it, I think in every case, 

10 the casing is cleaned up and repainted, and some of 

11 those repaint jobs are very nicely done and some of 

12 them are very poorly done, and of course if they 

13 rust out, then end of life comes before the winding 

14 gets done. 

15 MR. BROOKMAN: Okay. Mike. 

16 MR. HYLAND: On the maintenance one, I was 

17 just saying to Bob, I think it’s more about 

18 protection practices than maintenance practices will 

19 affect the life of transformers, such as lightning 

20 arrestors and CLFs, things like that. I did hand 

21 some information over to you guys, I think I may 

22 have sent some in to Chris on the – what’s the 

23 criteria for a utility decision to rewind. We have 

24 municipals that now are rewinding 100 percent. That 

25 criteria is past. And they have a great guy down in 

26 Tennessee, North Carolina area that does rewinding 

27 and – 

28 MR. HOPKINSON: Is his name Joe? 
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1 MR. HYLAND: But it does tie into to 

2 Phil’s comments that we have other parts of the 

3 country that they are afraid to have it rewound by 

4 the gentleman who’s near them, but it goes back to 

5 my original comments in the beginning, you know, a 

6 utility, at least municipal, in this economy right 

7 now, every dollar means something, and $50,000 means 

8 they get rid of an employee. That’s the facts. 

9 That’s what they’re going to do. And they’re 

10 looking at eking out without passing on any costs, 

11 so rewinding has become for them, a market, and 

12 every time you add to that market and costs, that 

13 market’s going to increase and we have an 

14 engineering ops meeting where they’re starting to 

15 share these success stories of refurbishing. It’s 

16 not something we want to encourage. We would rather 

17 them go back to A and B analysis, follow the DOE 

18 standards, we’re even big proponents of amorphous 

19 core, but that’s the utility decision. And the most 

20 you push upward on cost, that’s what it’s going to 

21 come down to for our members. 

22 MR. BROOKMAN: Would you reiterate that – 

23 for high quality rewind, the lifespan is about the 

24 same? 

25 MR. HYLAND: Well, you can’t tell until 

26 you – I mean it’s only become a market in the last 

27 few years for some of our members, and if the 

28 typical transformer is lasting them in their 
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1 analysis, 35 years, well, we’ll know in about 25 

2 years, won’t we. 

3 (LAUGHTER) 

4 MR. BROOKMAN: Bruce. 

5 MR. HIRSCH: A comment on the rewind 

6 market, at least from my company’s point of view is 

7 that the more valuable, the more expensive, the 

8 larger the transformer is, the more inclined we are 

9 to rewind it if we have problems with the windings. 

10 And to answer your last question, you know, we feel 

11 that a rewound transformer by a reputable company is 

12 like buying a new one. So we do that. We don’t 

13 rewind a lot of distribution transformers, but the 

14 maintenance refurbishment standpoint, Katie, our 

15 philosophy at BG&E is if the transformer is less 

16 than ten years old, comes back in out of the field, 

17 we’ll go over it. If we can refurbish it and maybe 

18 paint it up a little bit, maybe replace a bushing or 

19 something, if we had to do that, if we could do that 

20 for 20 percent of the cost of a new one, we will do 

21 that. We will refurbish the transformer and reuse 

22 it. So as the transformer prices from an efficiency 

23 standpoint, go up, that range where we would be able 

24 to afford to refurbish goes up also. So, you know, 

25 I would expect, with no change in philosophy, that 

26 we will refurbish some more transformers, maybe not 

27 a great number more, but we will refurbish more 

28 transformers. 
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1 MR. BROOKMAN: Bob. 

2 MR. SAINT: Yeah, there’s very little real 

3 evidence on this. We’ve discussed this quite a lot. 

4 However, there’s quite a lot of anecdotal evidence 

5 and we’ve discussed this a lot too. And just a 

6 couple of comments on those anecdotal things. Today 

7 our members, the electric co-ops in the U.S., mostly 

8 use RUS [Rural Utilities Service] loan funds to 

9 purchase transformers and other equipment. And 

10 right now, RUS will not loan money on refurbished 

11 transformers. However, we have been getting a lot 

12 of pressure from our membership to persuade RUS to 

13 change that policy. So if we are successful in 

14 persuading RUS to change that policy and, like Mike, 

15 personally I’m not as keen on using refurbished 

16 transformers as some of our members are, but if they 

17 do change their policy, then I think you’ll see a 

18 lot more people using refurbished transformers for 

19 their original purposes. 

20 My second point is that we already – we’re 

21 talking about two things here, we’re talking about 

22 rewinding the transformer, a company taking down a 

23 transformer that has failed, or for some reason 

24 sends it to a shop to rewind that transformer, and 

25 give it back to them. And that’s what Bruce was 

26 talking about. The other option is for a utility to 

27 go out and buy a new transformer to them that has 

28 been discarded by someone else and rewound by the 
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1 transformer manufacturer, and that’s the real 

2 questionable one in my mind, whether Joe down the 

3 street has done it or a reputable manufacturer does 

4 it. Even the reputable manufacturer, we really 

5 don’t know, we really don’t have a great track 

6 record on how good those transformers are and have 

7 they been tested and, you know, we don’t know the 

8 efficiency. We can’t, before they’re rewound know 

9 the efficiency until after they’re rewound and 

10 measured. 

11 MR. BROOKMAN: They’re not required to 

12 test or anything? 

13 MR. SAINT: No, not at this point, and 

14 there’s no requirements, DOE requirements or 

15 anything, that they be at a certain efficiency 

16 because they are remanufactured transformers. 

17 MR. BROOKMAN: Andrew deLaski. 

18 MR. deLASKI: A couple points. Bob, you 

19 said that – you started mixing up refurbished and 

20 rewound in your comments. I thought Katie drew a 

21 distinction between what we meant by refurbished and 

22 rewound. 

23 MS. COUGHLIN: Yes. 

24 MR. deLASKI: And what I heard you say, is 

25 that RUS, you’re dealing with RUS, and you’re 

26 thinking – you’re getting pressured to ask for 

27 approval to get loans to purchase refurbished 

28 transformers, not rewound. Or maybe you meant 
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1 rewound. 

2 MR. SAINT: Well, new transformers, I 

3 guess not newly manufactured transformers, but okay, 

4 refurbished – 

5 MR. deLASKI: I’m just trying to draw a 

6 distinction between refurbished and rewound in your 

7 comments. 

8 MR. BROOKMAN: Refurbished is not as 

9 extensive as rewound? 

10 MR. SAINT: Correct. 

11 MR. deLASKI: That’s what Katie said. 

12 MR. BROOKMAN: In most cases? 

13 MS. COUGHLIN: Yeah, at least 

14 conceptually, if we are going to model this. A 

15 refurbishment would be some kind of repair or 

16 perhaps related to protection that would simply 

17 extend the life of a given transformer without 

18 changing its engineering characteristics. Whereas a 

19 rewind is you actually take the unit, take it apart, 

20 keep the core, and rebuild everything else. 

21 MR. deLASKI: Right, so the point I want 

22 to make is I think that DOE needs to consider 

23 whether a rewound transformer is a covered product, 

24 and the reason why is that you’ve added the value of 

25 the product is, if you’re a manufacturer – who’s 

26 doing the rewinding, right? It’s not the utility 

27 company that’s doing the rewinding, although 

28 perhaps. It’s more likely a manufacturer, someone 
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1 that’s going to remanufacturer, so they’re entering 

2 the market as a transformer manufacturer and instead 

3 of buying steel from AK, Allegheny, or – they’re 

4 buying cores, and then they’re going to wind them. 

5 Sounds like transformer manufacturing to me, and I 

6 think DOE ought to really consider a guidance that 

7 would say those are covered products and subject to 

8 the standards. So this is something that needs to 

9 be considered. 

10 MR. HOPKINSON: Phil Hopkinson, HVOLT. 

11 Now some people have said that I disagree with 

12 Andrew, and actually in this case, I 100 percent 

13 agree with Andrew, so let me say that I really think 

14 that if we want to improve the efficiency of 

15 transformer energy efficiency across the board, then 

16 we really need to look at the refurbish rebuild 

17 market as well. 

18 MR. BROOKMAN: Robert. 

19 MR. BERMAN: Robert Berman, Berman 

20 Economics. It seems to me that when you’re talking 

21 about rewinding a transformer, scrapping everything, 

22 say, except the core, that all you’re doing is 

23 talking about sourcing the core as a used core as 

24 opposed to a newly built core, and if a transformer 

25 with a sourced core is considered under the 

26 standards, then a transformer with a sourced core 

27 regardless of that source, whether it be a new core 

28 or a core from scrap, the transformer is being 
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1 rebuilt. So I think the model – I think I agree 

2 with Andrew that the rebuilt transformer, the 

3 rewound transformer needs to be brought under the 

4 standards. 

5 MR. BROOKMAN: Greg, did you have a 

6 comment here? 

7 MR. COULTER: Yes. This is Greg Coulter, 

8 Prolec-GE. I want to echo Andrew and Phil. But I 

9 want to make a little clarification here. One of 

10 the problems with these rebuilt refurbished 

11 transformers is one is – I don’t want to pick on 

12 utilities, but sometimes utility does it himself, 

13 and he ought to be free to do what he wants with his 

14 own transformer. However, a high percentage of 

15 these are sent out to somebody else, ownership may 

16 or may not change, and they do rewind transformers. 

17 May or may not use the same core. That’s why I get 

18 concerned about reuse of the same core. It may not 

19 even be the same core in that transformer. They mix 

20 and match all the parts and make something work. We 

21 find another unfortunate part of this quite often 

22 our nameplate goes right back on that transformer. 

23 It doesn’t even get nameplated differently, or there 

24 may be a sticker on there that says refurbished. 

25 This is a tough area, but it’s an area that’s a 

26 loophole in this thing, by the comments you heard 

27 today, is growing, that’s a real concern to us, 

28 especially as a new transformer manufacturer. 
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1 MR. BROOKMAN: I’m going to entertain 

2 comments straight down the line here, starting with 

3 Ray first. Go ahead. 

4 MR. POLINSKI: Ray Polinski, ATI5 Allegheny. And again, this refurbishment thing, not 

6 being a transformer engineer or a utility, but it 

7 was the – I think everyone got their arms around it, 

8 including the advocates. This refurbish thing is a 

9 bad thing because really, the transformers that are 

10 failing are some that are 50 and 60 years old, and 

11 they’re some of your most inefficient ones on the 

12 grid. I mean so it’s kind of like an exponential 

13 problem where now you’re taking the most 

14 inefficient ones and you’re putting them back in 

15 service as opposed to – and so again, one thing that 

16 the group talked about, the DOE’s in the business of 

17 incenting more efficiencies and they don’t want to 

18 do the opposite here, but a program that was 

19 discussed that I think everyone got their hands 

20 around is another option, another thing for the DOE 

21 to consider would be almost like automobiles, a cash 

22 for clunkers program where you incent utilities to 

23 take out the oldest 60 year old transformers that 

24 are maybe 95 percent efficient and replace it with a 

25 99 percent efficient transformer. Think about the 

26 energy savings – and you could start doing that – 

27 there’s sufficient capacity in the grain-oriented 

28 supply chain and in the core steel supply chain and 
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1 in the transformer industry to do that almost 

2 immediately. So I just wanted to comment on that. 

3 MR. BROOKMAN: I think I saw Bob, Mike and 

4 John, and then I’ll go over here to Richard. 

5 MR. SAINT: This is Bob Saint from NRECA, 

6 and just a small comment, you know, I can’t disagree 

7 with the discussion that’s been going on here, but I 

8 heard from DOE that they thought it was clear to 

9 them that these types of transformers were not and 

10 could not be included in the rulemaking. 

11 MS. COUGHLIN: Yeah, let me – 

12 MR. SAINT: And so as far as DOE’s 

13 concerned, this may be a moot point in deciding 

14 whether or not to include them. 

15 MR. BROOKMAN: Let’s hear from Katie. Go 

16 ahead. 

17 MS. COUGHLIN: I just wanted to clarify. 

18 If the ownership of the unit is retained by the 

19 original purchaser, it’s definitely not covered. I 

20 think if you were to develop a new industry where 

21 you were recycling transformer cores, I think that 

22 would be more open. 

23 MR. BROOKMAN: I think actually we’re 

24 getting ground on this subject here, but let’s try 

25 and keep these comments brief. 

26 MR. HYLAND: My comment was very similar 

27 to Bob’s. I was looking for Dan Cohen. He’s the 

28 one who came to our meeting and made it quite clear 
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1 that DOE has no authority in this area. 

2 MR. BROOKMAN: John, final comment before 

3 I go over here? Is your mic on? Thank you. 

4 MR. PHOUMINH: John Phouminh, PEPCO 

5 Holding Inc. I want to make comment that utility 

6 like us we would not refurbish the transformers 

7 because we don’t have the expertise in that field 

8 and the manpower to do that. We might as well buy 

9 new transformers. 

10 MR. BROOKMAN: Richard. 

11 MR. PARKER: Yes, Richard Parker. First, 

12 my apologies for arriving late. I spent 30 minutes 

13 on the Red Line waiting for a train to come. The 

14 Washington denizens know that experience. Anyway 

15 it’s just been a pleasure listening to this 

16 discussion. Just quickly on this one point, since 

17 Dan isn’t here, we did have a very significant 

18 discussion about this during the rulemaking process, 

19 and what I took away from it was something in 

20 between Andrew and Mike, that there are significant 

21 issues about where the title passes, and there are 

22 opportunities for utilities to sort of game the 

23 system by structuring the transaction in a certain 

24 way. As a lawyer, I know that the Department also 

25 has the means to put substance over form instead of 

26 form over substance and perhaps recharacterize some 

27 of these transactions if they turn out to be an 

28 evasive tactic. 
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1 So as I recall where we left it was that 

2 this would be an issue that the Department would 

3 look at, not one that was resolved one way or the 

4 other, but an important one for people to discuss. 

5 MR. BROOKMAN: Thanks for that 

6 clarification. Steve, thanks for being patient. 

7 (Fire alarm required exiting building.) 

8 (Whereupon, the meeting in the above 

9 captioned matter was adjourned for lunch recess.) 

10 

11 AFTERNOON SESSION

12 1:45 p.m. 

13 MR. BROOKMAN: Okay, so good afternoon, 

14 welcome back. It’s now 1:45 here in the Forrestal 

Building. It’s still February 23rd 15 . We had a fire 

16 drill. We had to empty the building out. I’m 

17 pleased to see a lot of folks made it back. There’s 

18 some others that will still be joining us, but in 

19 the meantime, we’re going to proceed with the 

20 content, provide an opportunity for each person in 

21 here to talk about the things that matter to them. 

22 So, we’re going to hear next from Christopher. 

23 Trial Standard Levels and Proposed Standards 

24 MR. BOLDUC: Hi, Chris Bolduc, LBL. Just 

25 to pick up where we left off from lunch. After 

26 revising the preliminary analysis we have several 

27 downstream analyses, subgroup analyses, manufacturer 

28 impact analysis, utility impact analysis, employment 
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1 and environmental assessment and the regulatory 

2 impact analysis. For the purpose of today’s 

3 presentation, the Department doesn’t have any 

4 comments, we’re not seeking comments on any of 

5 these, but you’re free to comment if you wish after, 

6 in the unstructured time. 

7 I’ll move into the trial standard levels 

8 and the selection of these trial standard levels for 

9 the liquid-immersed transformers. TSL-1, which is 

10 the proposed standard – do you have a question, 

11 Andrew, sorry. 

12 MR. deLASKI: On the previous slide. 

13 MR. BOLDUC: Yes. 

14 MR. BROOKMAN: Andrew deLaski. 

15 MR. deLASKI: I just want to reiterate 

16 something I said this morning, which is that it 

17 strikes me that one of the key issues that has not 

18 been analyzed is the impact on employment in steel 

19 manufacturing. There’s a lot of emphasis put in the 

20 NOPR on impact on steel manufacturers, yet we don’t 

21 have an analysis on the impact on steel 

22 manufacturers, and particular on the employment at 

23 various TSLs. So I just want to emphasize again 

24 that that’s an important issue that needs to be 

25 addressed. This is an unusual rulemaking – I was 

26 just talking to Ray, you know, you have a supplier 

27 who represents a very large portion of the value of 

28 the product, and it’s very unusual to have a 
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1 supplier that plays such a big role in the 

2 rulemaking, and I think in this case it could merit 

3 a much more significant impact – an analysis of 

4 impact on the steel manufacturers, including 

5 employment. 

6 MR. BROOKMAN: Okay. Steve Rosenstock. 

7 We’re going to keep moving here rapidly, though. 

8 Steve. 

9 MR. ROSENSTOCK: Steve Rosenstock, EEI. 

10 The last slide before we had to break was about 

11 refurbishment issue, and again, I just wanted to say 

12 that again, I just want to follow Mike in terms of, 

13 yes, there’s the scoping issue. DOE has never set 

14 an efficiency standard for any other commercial or 

15 residential or industrial appliance or product that 

16 is, quote, “being refurbished or repaired or any 

17 sort of revamping.” Once – again, it’s a matter of, 

18 this is only on new manufactured and newly imported 

19 products, so there are people who keep repairing our 

20 products, whatever they are, could be they’re 

21 probably some 50-year old refrigerators out there, 

22 because people keep on repairing them. That’s their 

23 right. They have a right to do it. We’ve never set 

24 a standard for anyone who’s doing that sort of 

25 repair type of situation. So, for doing it for this 

26 would set a new precedent, and DOE does not have the 

27 legal authority to do such a thing. You’d have to 

28 change EPCA to do something like that. Thank you. 
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1 MR. BROOKMAN: Thanks, Steve. Okay. Now 

2 we’re going to proceed. 

3 MR. BOLDUC: So for liquid-immersed 

4 transformers, there were seven TSLs were composed. 

5 The first TSL represents a standard or a level where 

6 a diversity of core materials are cost competitive 

7 and economically feasible for all design lines, and 

8 this is the proposed standard. TSL-2 is EL-1 for 

9 all design lines. TSL-3 is a maximum efficiency 

10 achievable with M3 steel, core steel. TSL-4 is the 

11 maximum NPV with seven percent discounted. TSL-5 is 

12 EL-3 across all design lines. Now with all due 

13 respect to Andrew deLaski at ASAP, this is what we 

14 interpreted as your position at the end of 

15 negotiations, or the position that you represented 

16 as opposed to EL-2 across all efficiency levels. So 

17 there’s a misrepresentation here. It is what I’m 

18 stating. 

19 MR. deLASKI: What I said this morning is 

20 that the ESL that was closest to our position is 

21 TSL-4. TSL-4 is close to being EL-2 across the 

22 board, though not exactly. 

23 MR. BOLDUC: Right. 

24 MR. BROOKMAN: Okay. Go ahead. 

25 MR. deLASKI: The Department gave notice 

26 that our position was EL-3 across the board – 

27 MR. BOLDUC: That’s right. 

28 MR. deLASKI: -- and that was not correct. 
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1 MR. BOLDUC: That’s right. TSL-5 was 

2 intended to be your position. 

3 MR. deLASKI: Oh, was intended to be EL-3 

4 across the board? 

5 MR. BOLDUC: That’s right. 

6 MR. deLASKI: I see, that was the intent. 

7 Okay. I’ve got a few follow-up questions, but -- 

8 MR. BOLDUC: Yes, please. 

9 MR. BROOKMAN: Steve. 

10 MR. ROSENSTOCK: Steve Rosenstock, EEI. 

11 As I recall, I thought you, Andrew, that you’re 

12 starting with a mix of four and three, EL-4 and EL13 3, and during the negotiations, especially during 

14 the initial parts, it was – 

15 MR. deLASKI: Let me just remove any 

16 ambiguity. We support EL-2 across the board. 

17 That’s where we are right now. Where we were at one 

18 point or another, water over the dam. We don’t need 

19 to go back and talk about it. 

20 MR. ROSENSTOCK: Okay. No problem. 

21 Understood. Steve Rosenstock, EEI. Again, there 

22 are a lot of ELs put out here, and for people who 

23 were part of the negotiations, there were ELs, and 

24 CSLs, and now we’re into TSLs because of the NOPR, 

25 because that’s what you’re supposed to do, so again, 

26 I think for everybody, especially for people on the 

27 webinar is that, you know, try to – when we’re 

28 talking just that people should be respectful that 
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1 not everybody has memorized every single EL and CSL, 

2 especially since they might have changed. And that 

3 these TSLs are, I’m hoping to say, are kind of 

4 aligned with some of the ELs and CSLs we saw during 

5 the negotiation, but this is kind of a final version 

6 of the analysis. Would that be a fair assessment? 

7 MR. BOLDUC: Yes. 

8 MR. ROSENSTOCK: Thank you. 

9 MR. BROOKMAN: Yes, Ray. 

10 MR. POLINSKI: Ray Polinski, ATI11 Allegheny. And Andrew, just to be clear, you said 

12 two across the board. I thought 2.1, 2.2 or 

13 something was where you guys were at, as opposed to 

14 two across the board. 

15 MR. deLASKI: No, I said two across the 

16 board, and then I suggested this morning – Okay, 

17 good time for me to reiterate this point – so I’ve 

18 got a couple questions about the TSLs and then I’ll 

19 reiterate the TSLs we think the Department should 

20 have. We think the Department should analyze four 

21 additional TSLs, and one of those would be TSL-2 

22 across the board, which is the position that we said 

23 we were willing to accept during the negotiation 

24 process, and which I reiterated again today that we 

25 would support today – excuse me, EL-2. Terminology 

26 is tricky. 

27 MR. BROOKMAN: Thanks for the 

28 clarification. Keep going. 
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1 MR. deLASKI: So having a TSL that 

2 consisted of El-2 across the board is something that 

3 we recommend should be included in a final analysis. 

4 We also think that having a TSL that is at EL-1.5 

5 across the board would be valuable for decision6 making. That is a position that some stakeholders 

7 indicated during the negotiation process that they 

8 thought the crossover point was likely at EL-1.5, so 

9 therefore I think – let me just finish – 1.5 would 

10 be valuable to have an EL at that level – TSL at 

11 that level as well. 

12 And then I said I also think that having 

13 pads versus poles distinguished would be valuable, 

14 so that having sub-one for each of these, that we 

15 would have a TSL that consisted of two across the 

16 board, except for a step down one level for poles. 

17 And then the same thing, EL-1.5 across the board, 

18 except step down one level for the poles, 

19 recognizing the concerns we’ve heard about poles. 

20 I’m suggesting, recommending to the Department that 

21 those be considered as additional TSLs in a final 

22 analysis. 

23 MR. BROOKMAN: Ray. 

24 MR. POLINSKI: Ray Polinski, ATI25 Allegheny. And just to – semantics, whatever, but 

26 my recollection, and the record will speak for 

27 itself, when some of these people threw out those 

28 levels above that, they were like the outer – 
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1 doable, possibly, feasible, but not practical. 

2 MR. deLASKI: Yeah, I think we’re zeroing 

3 in on this question of the crossover point. We all 

4 agreed, I’ve agreed, that we want to be in a market 

5 where we have robust competition amongst the 

6 suppliers of core material. And you’re agreeing and 

7 everyone – I think we all agree with this, and what 

8 we have disagreement on is where is that point. And 

9 that’s what we haven’t been able to nail down. And 

10 I know there’s been different analyses that have 

11 shown that point in different places and different 

12 people have different views on where that point is. 

13 I think we still need a more thorough analysis, 

14 independent, by the Department, that helps us nail 

15 down where is this crossover point so that consumers 

16 benefit – ultimately all consumers benefit from 

17 having robust competition among the suppliers. 

18 MR. POLINSKI: Ray Polinski, ATI19 Allegheny. And again, we’ll move forward – and 

20 you’re saying one of your other action points, you 

21 want the crossover points to be reanalyzed. My 

22 point is that they shouldn’t even do your other 

23 studies of the 1.5s or the twos, because the 

24 crossover points right now are where the – pretty 

25 much where the rule ended up. I mean, so there’s no 

26 sense in doing another study unless – you’re saying 

27 it’s time for more analysis, but my recollection was 

28 when we had our last conference call, you guys said 
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1 – you the advocates, I won’t say Andrew – the 

2 advocates kind of said, hey, this is done. We’re 

3 done with analysis, you know, in the middle of 

4 December, we even talked about should we extend this 

5 a little bit, we’re done with analysis, we’re – it’s 

6 time to move on. So I guess you’re changing that 

7 position. 

8 MR. deLASKI: No, that was for the 

9 negotiation. We’re out of the negotiation, this is 

10 now rulemaking and DOE has to do new analysis. They 

11 ought to. This is a NOPR. You put out a NOPR for 

12 comment and the Department has to respond to 

13 comment. They have a legal obligation to respond to 

14 comment. 

15 MR. BROOKMAN: I wanted to reinforce that 

16 point. We’re not in a negotiation here. We want to 

17 get the best comment we can. John, you’re next. 

18 MR. deLASKI: So I really want to be 

19 clear, Ray. I don’t mean to be shifting on you, 

20 this is a different stage of the process. 

21 MR. CASKEY: John Caskey, NEMA. Just to 

22 be sure we’re still talking apples and apples, when 

23 you say across the board, are you meaning liquid24 immersed, or are you saying everything – 

25 MR. deLASKI: No, liquid-immersed. We’re 

26 talking liquid-immersed. 

27 MR. CASKEY: -- from one to 13? Okay. 

28 Just wanted to make sure. 
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1 MR. deLASKI: Thank you, John. 

2 MR. BROOKMAN: Thanks for clarifying. 

3 Keep going. 

4 MR. deLASKI: So I have a couple 

5 clarifying – I’ll be happy to answer questions on my 

6 proposal, but that’s – so there’s a few things about 

7 the TSLs that continue to puzzle me, and I’ll start 

8 with TSL-5. The Department contends that TSL-5 is 

9 EL-3 across all design lines, but when I looked at 

10 the actual efficiency levels, it’s not. In fact, 

11 it’s a mix of ELs, based on the actual efficiency 

12 levels. So I don’t think we want to walk through it 

13 here right now, but it’s not EL-3 across the board. 

14 MR. BROOKMAN: Is it significantly 

15 different? 

16 MR. deLASKI: One of the design lines is 

17 at EL-2. I’m also puzzled by TSL-3 as being the 

18 maximum achievable efficiency – maximum efficiency 

19 achievable with M3 steel. The Department presented 

20 an analysis at the November meeting over the 

21 negotiating committee – this is the one dated 

November 2nd 22 – where they showed some very famous 

23 tables that got us all very excited. People who 

24 were there will remember, that showed where M3 was 

25 viable as a design option, and these were tables on 

26 the PowerPoint what was vetted at that meeting, 

27 pages 13, 14, and 15. And in that table it showed 

28 that the design lines were achievable up through 
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1 significantly higher efficiency levels than are 

2 contained in TSL-3. 

3 So my understanding is that engineering 

4 analysis hasn’t changed between now and then – 

5 MR. BOLDUC: I can’t see the presentation 

6 you have in front of you, and I don’t have perfect 

7 memory – 

8 MR. deLASKI: So I’m going to ask you to 

9 go back and take a look at that. 

10 MR. BOLDUC: Sure. I’m just – since you 

11 have that in front of you, was that for all design 

12 lines? 

13 MR. deLASKI: Design lines one, two – 

14 yeah, what it showed was that you could use M3 up 

15 through EL-3 for design line 1. It said you could 

16 use it up through EL-1 for design line two. So this 

17 is correct for design line two. It showed you 

18 could use it up through EL-3 for design line three. 

19 It showed you could use it up to EL-2 for design 

20 line four – 

21 MR. BROOKMAN: Andrew, maybe you could 

22 write down the title of PowerPoint presentation, or 

23 someone who’s got it – maybe you’ve got it, Steve, 

24 and hand it off so – 

25 MR. BOLDUC: Please. 

26 MR. ROSENSTOCK: And Andrew -- Steve 

27 Rosenstock, EEI – you’re talking about the November 

3rd 28 handout, Distribution transformers energy 
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1 conservation program – 

2 MR. deLASKI: This is simpler, which is 

3 that TSL-2 is EL-1 except – I’m sorry, TSL-3 is 

4 mostly EL-1. So this is saying that you can’t go 

5 above EL-1 with an M3 transformer. And that is not 

6 consistent with – 

7 MR. BROOKMAN: I want to keep this moving 

8 ahead. Steve. 

9 MR. ROSENSTOCK: Steve Rosenstock, EEI. 

10 And I believe, Andrew, you’re referring to these 

11 tables right here, right? Is this the table. 

12 Again, this was a table called Core Material 

13 selection, and it was basically, again, part of the 

14 life-cycle cost analysis and basically it also 

15 showed that for those higher levels that they were – 

16 there might have been some, or at least one 

17 particular model using M3. That could have been 

18 just one dot in that efficiency level, and it showed 

19 zero percent, and it showed 100 percent being shown 

20 as something else because the price discrepancy was 

21 so large that they chose the lowest cost issue. So 

22 yes, I agree there might be some designs that were 

23 at those levels, but those might have been the pure 

24 outliers or, you know, I saw the scatter-plots, 

25 eight million scatter-plots. They were kind of 

26 blinking in my eyes later on that day. That’s not 

27 necessarily – it might have been just one unit by 

28 one manufacturer, and so – and it was so expensive 
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1 that for the life-cycle cost analysis they didn’t 

2 use it because there was a much lower cost 

3 transformer to use to reduce those incremental 

4 costs. 

5 MR. deLASKI: That’s not what the slide 

6 says. 

7 MR. BOLDUC: Yeah, I hear you. 

8 MR. BROOKMAN: So let’s – yeah, Phil 

9 first. 

10 MR. HOPKINSON: Phil Hopkinson, HVOLT. I 

11 did a lot of studies of data, trying to compare 

12 transformer selling price against efficiency for M3 

13 material. And in fact, it is theoretically possible 

14 to build transformers all the way up to what would 

15 be considered EL-4 with M3 steel. Now the problem 

16 was that we got into extremely low flux densities 

17 and extremely high copper weights, and the selling 

18 price literally tripled. So that doesn’t say that 

19 just because you can build it, in theory, that it’s 

20 something that you would want to do. And when you 

21 then look to see what the alternative – so if you 

22 allowed amorphous back into the picture, then you’d 

23 see that amorphous could get there easily and the 

24 selling price wouldn’t go up anywhere near that 

25 much. So that whether you can theoretically build 

26 it or not has nothing to do where the breakover 

27 point is, and that breakover point is hard after EL28 1. 
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1 MR. BROOKMAN: Jerry, you going to follow 

2 on? Yes, Jerry. 

3 MR. CORKRAN: I was going to say somewhat 

4 the same thing as Phil said, also repeat what I said 

5 this morning when Andrew was proposing higher than 

6 EL-1. EL-1 is a level playing field between 

7 amorphous and silicon core steel. It’s where 

8 they’re both competitive, neither one has a 

9 tremendous advantage. When you go above EL-1, the 

10 scale tips and amorphous has a tremendous advantage. 

11 So to make the family of designs that the customers 

12 want, the many different dual voltages and different 

13 things, it needs to be no higher than EL-1. 

14 MR. BROOKMAN: Okay. Are we ready to move 

15 on? 

16 MR. BOLDUC: I think Andrew still has a 

17 critical set of issues. 

18 MR. deLASKI: So then the other set of 

19 issues – the other point I want to make is again, 

20 we’re not making decisions here, we’re just saying 

21 what the – I’m just commenting on the TSLs, right, 

22 and I think if you’re going to describe something as 

23 being the maximum achievable with M3, then that’s 

24 what it ought to be. 

25 Now my other concern is that you said that 

26 the TSL-1 is the proposed level, yet, and I 

27 mentioned this earlier today, is that when I compare 

28 TSL-1 to the NOPR levels, they’re actually 
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1 different. And I understand there’s been some sort 

2 of scaling or smoothing of the curve, so to speak, 

3 but the level – 

4 MR. BOLDUC: The efficiency percentages 

5 are slightly different than those analyzed, yes. 

6 MR. deLASKI: Slightly different, it’s 

7 point – it’s point four, so it’s 40 percent of EL-1 

8 for design line one, which is a 50 KVA transformer, 

9 which is a bread-and-butter product. So, it’s more 

10 than slightly different. The loss reduction for EL11 1 is 3.3 percent for design line one, whereas EL-1 

12 was 8.7 percent reduction in losses. So I think 

13 it’s an awkward spot for the Department to be in, to 

14 be proposing standards that are different than those 

15 analyzed. And I know you’ve got to smooth – you’ve 

16 got to stiff this curve, but it’s an awkward spot. 

17 You know, we’ve got folks saying they can live with 

18 EL-1, but yet the level being proposed is not even 

19 half way there. And we’re talking about, as people 

20 have pointed out, being very efficient, we’re trying 

21 to reduce losses – we’re trying to reduce those 

22 losses and those five percent matters. 

23 MR. BROOKMAN: Steve Rosenstock. 

24 MR. ROSENSTOCK: Steve Rosenstock, EEI. 

25 Since this issue came up, I did notice – Andrew was 

26 talking about design line one. For design line two, 

27 the value is increased over the TSL-1 value. It was 

28 98.91 in the table, the TSL table, but in the 
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1 proposed standard it’s 98.95, so in that case it 

2 went up rather than down. Also for design line 

3 three, where the TSL-1 value is 99.48, the table 

4 value is 99.49, so it cuts both ways. I don’t know 

5 what impact that has in terms of the national energy 

6 savings, but especially since design line two is the 

7 single-phase pole mount, that can be significant for 

8 a lot of situations. So it went both ways, and 

9 again, there is an issue that we don’t see the 

10 98.95, for example, in any of the tables, so again, 

11 we’re not sure of the economics. I didn’t see it in 

12 the NOPR, same with 99.11, same with 99.49, so I 

13 mean there’s that in terms of analytical issue, but 

14 again, at the end it cut both ways. I’m not sure 

15 how it impacts all of our members. I made sure that 

16 they knew about it, but it was both ways. 

17 MR. deLASKI: So to me it points to the 

18 need for additional analysis again. We don’t have 

19 an analysis of the standards proposed. And we need 

20 that analysis, and we need the analysis of these 

21 additional TSLs to be able to make a final decision 

22 that is based on a robust, complete record. 

23 MR. ROSENSTOCK: Steve Rosenstock, EEI. 

24 Or just put the efficiency value the same as the TSL 

25 values. 

26 MR. deLASKI: Well, you can’t do that 

27 because poles and pads aren’t separate classes. 

28 PARTICIPANT: It’s tricky. 
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1 MR. BROOKMAN: Thanks for those comments. 

2 What we’re going to do is move on to the next set. 

3 MR. BOLDUC: So the next set of slides, or 

4 next set of TSLs are for low-voltage dry-type. 

5 Again, there are six TSLs. TSL-1 is maximum 

6 efficiency achievable with M6 steel. TSL-2 is the 

7 NEMA premium levels. TSL-3, the maximum efficiency 

8 using butt-lap core mitering for single-phase and 

9 full mitering for three-phase designs. TSL-4 is max 

10 NPV with seven percent discounting. TSL-5 is 

11 maximum source energy savings with seven percent 

12 discounting, the positive NPV, excuse me. And TSL-6 

13 is max-tech. 

14 Now, the Department has selected – is 

15 proposing TSL-1 as the standard. 

16 MR. BROOKMAN: Andrew. 

17 MR. deLASKI: So as I said this morning in 

18 the opening remarks, the level that we’ve been 

19 supporting, and continue to support is EL-4 across 

20 the board, which happens, in this case that we 

21 actually do have a TSL which represents that, which 

22 is TSL-3. So we don’t see a need for additional 

23 TSLs here. We appreciate the Department has 

24 evaluated NEMA premium levels. My understanding is 

25 that the levels shown are not precisely the NEMA 

26 premium levels, that’s my understanding, so we need 

27 to take a look at that. 

28 And then the second point I want to make 
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1 is to reiterate the point I made this morning which 

2 is that during the negotiation, it was said on the 

3 record by multiple parties, including manufacturers, 

4 that they can butt-lap up through what’s now TSL-3, 

5 and the Department needs to do a more full – if 

6 butt-lapping is going to be a decision criteria, 

7 then the Department needs to do a more full analysis 

8 of how far can you go with butt-lapping 

9 manufacturing techniques. It may not be the 

10 cheapest technique, but if you still can – I think 

11 what may have happened is they had been removed 

12 because it was perhaps cheaper for some 

13 manufacturers to do mitering, but perhaps not for 

14 the small guy to miter. So it may be that some 

15 manufacturers choose to butt-lap up through TSL-3 

16 because they don’t want to make that investment or 

17 they can’t, and that may take having some additional 

18 engineering options to your software, and doing an 

19 additional set of runs for optimization around those 

20 additional designs. But I think you’ve got to fill21 in those curves. 

22 MR. BOLDUC: Right. 

23 MR. BROOKMAN: Phil. 

24 MR. HOPKINSON: Phil Hopkinson, HVOLT. 

25 What I would say is there’s two issues from that. 

26 One is can you even build a transformer and with 

27 butt-lapping, I think that you probably can build 

28 something pretty close to efficiency level three, 
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1 but you can’t be competitive, and that’s the second 

2 part of it, so that if you, in fact, impose a 

3 requirement that goes so far, it still puts the 

4 small guy out of business because while he could 

5 theoretically build a transformer that’s butt6 lapped, he can’t actually sell that at a price where 

7 he can recover his material costs, so that he is 

8 still put out of business. 

9 MR. BROOKMAN: Thank you. Other comments 

10 on these LVDTs and these trial standard levels? 

11 MR. deLASKI: To follow up on Phil’s 

12 point, and that’s a point for analysis. That’s 

13 something that we want to see analyzed as opposed to 

14 simply a conclusionary remark by the Department 

15 based on no analysis is where we are today. We’ve 

16 got Phil’s expert opinion, based on a lot of 

17 experience, what we don’t have is the Department 

18 analysis that tells us, what is the cost penalty? 

19 Is it five percent or is it 50 percent? And can 

20 these guys compete? And we need the answer to that 

21 question. 

22 MR. HOPKINSON: I think that data could be 

23 acquired. 

24 MR. BROOKMAN: Thanks, Phil. 

25 MR. BOLDUC: So for medium-voltage dry26 type transformers, we have five TSLs. TSL-1 is EL-1 

27 for all design lines. TSL-2 represents a TSL where 

28 a diversity of core materials are cost competitive 
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1 and economically feasible. This was the level 

2 arrived at through the negotiation process. TSL-3, 

3 is maximum NPV with seven percent discounting. TSL4 4 is maximum source energy savings with positive 

5 NPV. And TSL-5 is max-tech. Steve. 

6 MR. ROSENSTOCK: Steve Rosenstock, EEI. I 

7 believe you received the comments from Commonwealth 

8 Edison. They’re one of our member companies that 

9 they purchase significant number of these because 

10 they’re the ones actually installing and maintaining 

11 them in their urban area at the commercial and 

12 industrial facilities, so I think we all agreed to 

13 it, but just take their comments into account. This 

14 is another space/size constraint issue, because 

15 these are inside large commercial buildings 

16 sometimes. So just consider their comments, that 

17 would be very helpful, thank you. 

18 MR. BROOKMAN: Additional comments on 

19 this? Okay. 

20 MR. BOLDUC: So the next three slides 

21 show the efficiency levels for the different KVA 

22 ratings. For liquid-immersed, low-voltage, and 

23 medium-voltage dry-type transformers. You have the 

24 numbers in front of you. There’s not much I have to 

25 say on these. 

26 MR. BROOKMAN: I guess we have three 

27 tables here and anybody that wishes to do so can 

28 comment on any of these. Yes, Andrew. 
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1 MR. deLASKI: It would have been nice in 

2 the NOPR to have had a mapping of EL/TSLs. 

3 MR. BOLDUC: Yes, there is one in the TSD. 

4 MR. deLASKI: Can someone give us the page 

5 reference? 

6 MR. BOLDUC: In the TSD, I can’t give it 

7 to you right now, it’s in Chapter 10. It would be 

8 in the NIA chapter. 

9 MR. deLASKI: Okay. Thanks a lot. 

10 MR. BOLDUC: Yep So in summary, the 

11 proposed rule, we have energy savings of 1.58 quads 

12 over 30 years. An estimated – and this could 

13 eliminate the need for 2.4 gigawatts generating 

14 capacity, the need to build new capacity, new 

15 generation. We have a cost savings, a cumulative 

16 net present value ranging from 2.9 billion to 12.1 

17 billion at three and seven discount rates – at 7-3 

18 percent discount rates. And the cumulative 

19 environmental benefits of 112 metric megatons of 

20 CO2, NOX emissions reductions of 99.7 kilotons, and 

21 mercury emissions reductions of 0.8 tons. 

22 MR. BROOKMAN: Phil. 

23 MR. HOPKINSON: Chris, a good set of 

24 numbers. My point – my question is, the 1.58 quads, 

25 is that the incremental savings from this new NOPR 

26 or – 

27 MR. BOLDUC: Cumulative. 

28 MR. HOPKINSON: -- or is that including 
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1 the 2010 rule. 

2 MR. BOLDUC: Oh, no, that would be simply 

3 this rule. Not including the 2010 rule. 

4 MR. BROOKMAN: Steve. 

5 MR. ROSENSTOCK: Steve Rosenstock, EEI. 

6 I’m looking in the – oh, that’s annualized benefit. 

7 Okay, I was looking in the NOPR and the NOPR has 

8 quite a range of total net benefits, so it seems – 

9 okay, 2.9 to – okay – that’s over the 30 – that cost 

10 savings, that’s 30 years at seven and three percent. 

11 I see. Quick one for you. In terms of the 

12 environmental benefits, EPA just came out with their 

13 mercury rule, and the emissions for power plants, 

14 mercury emissions are mandated to go down 75 percent 

15 within three years, and then they’re going to be 

16 pretty much capped, are you going to treat mercury 

17 like you treat other emissions that are capped 

18 upstream, in terms of benefits? 

19 MR. BOLDUC: I’ll have to look at the EPA 

20 rule. 

21 MR. ROSENSTOCK: Yeah, it goes into effect 

22 three years before this takes effect, so that will 

23 change some of these projected estimates. 

24 MR. BOLDUC: Likely. 

25 MR. ROSENSTOCK: Thank you. 

26 MR. BROOKMAN: Andrew. 

27 MR. deLASKI: I want to – just the point I 

28 made this morning, which is that we think the 
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1 estimates for the low voltage dry types are 

2 mischaracterized because the curves are 

3 mischaracterized, and this number actually reflect 

4 consumers selecting transformers more efficient than 

5 the minimum standard, which is not what we’re seeing 

6 in the market, and not what manufacturers have said 

7 they would expect. So I think the savings are being 

8 over-estimated for low-voltage dries because the 

9 curve isn’t filled in, and we’re selecting 

10 transformers – so it shows very little difference – 

11 not very little difference because it shows .2 quads 

12 different between level one and level three, which 

13 we think is inaccurate and not based on substantial 

14 evidence. 

15 I also would note that the low-voltage 

16 dries, even with that inaccuracy are driving the 

17 lion’s share of the savings in this docket. Just 

18 .36 of the savings total is being driven by the 

19 liquid-immersed market. 

20 MR. BOLDUC: That’s correct. 

21 MR. BROOKMAN: Other comments looking down 

22 this summary slide? 

23 MR. BOLDUC: So, on this slide we have the 

24 annualized benefits for the proposed rule. The 

25 primary estimate is the default scenario for all the 

26 models, and the low net benefit is run with a high 

27 equipment price and a low economic growth scenario. 

28 And likewise, the high net benefit estimate is high 
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1 economic growth, low equipment price. So we have a 

2 primary estimate bracketed by the low and high, and 

3 we have ranges for the CO2 evaluations. 

4 MR. BROOKMAN: Steve. 

5 MR. ROSENSTOCK: Steve Rosenstock, EEI. I 

6 know you don’t have any control over it, but for the 

7 record, you’re monetizing all, you know, the 

8 environmental values, but you’re discounting them at 

9 different rates, so analytically I think that’s 

10 extremely inconsistent, extremely inconsistent. I 

11 know that you’re required to do that by the 

12 interagency memo, but when you’re discounting some 

13 things at seven percent, and you’re discounting 

14 other things at two and a half percent, you’re 

15 getting a distorted number at the end, in my view. 

16 MR. BOLDUC: Right. That’s why we’re 

17 presenting a range. 

18 MR. ROSENSTOCK: Right, but again, there’s 

19 still an issue in that when you’re talking about 

20 some of these net cumulative savings, and then some 

21 of the annualized savings, it’s still analytically – 

22 there’s still issues, because when you’re saying 

23 you’re monetizing everything and you’re not 

24 discounting at the same rate over the same lifetime, 

25 and it’s over the same analytical period, it’s 

26 distorting the result in my view. Because you’re 

27 saying that something – we’re going to say, well the 

28 cost, well, you know, some things, like the cost 
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1 transfer we’ll discount at seven percent, but the 

2 savings we’ll only discount at two and a half 

3 percent because that way that’ll make the benefits 

4 look a lot better. I just think it’s inconsistent. 

5 I know you’re required to do that. I’m just saying 

6 this for the record that in terms of doing an 

7 analysis, when you’re discounting different parts of 

8 the analysis at different rates, it’s distorting the 

9 analysis. 

10 MR. BROOKMAN: Okay. Other comments on 

11 this benefits and costs slide. 

12 MR. BOLDUC: Thank you all very much, that 

13 concludes the main presentation for this afternoon. 

14 MR. BROOKMAN: There is quite a lot of 

15 supplemental information, additional slides, oh, I 

16 don’t know, 30 pages or so, -- oh, they’re not in 

17 the package. 

18 As we said at the outset, now is another 

19 opportunity for anybody that wishes to do so to make 

20 additional points, emphasize things that haven’t 

21 been emphasized today adequately, and perhaps 

22 briefly. So who would like to go first? Please. 

23 Discussion of Proposed Standards 

24 MR. PETERSEN: Eric Petersen, AK Steel. 

25 First off, just want to congratulate the entire 

26 group that was here. I know it was quite an arduous 

27 process, but as we began the outset of this path 

28 that we have been down, we commented that the value 
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1 of what we were bringing to the table was the 

2 ability to be able to bring industry experts all to 

3 the table to be able to bring a correct perspective 

4 of the issues that each group represented. It’s 

5 been a theme that we’ve talked about consistently 

6 and I’m glad to hear that we continue to say it here 

7 at the end, and we’ve actually divined TSLs to 

8 directly reflect it, that the intent was to identify 

9 a standard level that would provide a diversity of 

10 core materials that were cost competitive and 

11 economically feasible. 

12 And as Mr. deLaski stated, the magic 

13 question is, what is that point level. That really 

14 has been what has been driving us. I would remind 

15 the organization that the benefit of the negotiated 

16 rulemaking was that we had the experts, the 

17 transformer manufacturers, here, which really are 

18 the only ones that can best help us understand where 

19 that crossover point is. 

20 The recommendation that the transformer 

21 manufacturers brought to the table, defined an 

22 efficiency level at which they see that crossover 

23 point occurring. That is the point that the DOE 

24 correctly reflected when they chose the TSL to be 

25 set as a proposed standard. Now there’s been 

26 reference to three companies who are at the table in 

27 regards to a higher potential efficiency level that 

28 was mentioned. I don’t recall or interpret their 
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1 conversation the same way that Mr. deLaski has 

2 stated here today, that they stated – the point was 

3 there. I think it’s important to define that there 

4 is the capability, technically, to be able to make a 

5 transformer at a certain level, however, that does 

6 not insure that the transformer will achieve the 

7 goal of cost-competitive and economically feasible. 

8 We’ve had one of those three 

9 organizations, the one that made an opening 

10 statement today, specifically point out that since 

11 they were referenced as one of the three, that they 

12 emphasize that they were party to and supported the 

13 NEMA presentation. 

14 So I guess I would again thank the DOE for 

15 the work that you’ve done. It’s been exhaustive, 

16 and thank the committee in regards to defining the 

17 criteria. We’ve all agreed to that, which is the 

18 diversity of core materials which is cost 

19 competitive and economically feasible, and point to 

20 the industry experts the value of what we brought 

21 within the negotiated rulemaking session, the 

22 transformer manufacturers as being really the key 

23 group that can define where that crux is, and 

24 they’ve done that for this efficiency level. 

25 MR. BROOKMAN: Okay. Thank you. Yes, 

26 John. 

27 MR. CASKEY: John Caskey, NEMA. A couple 

28 different thoughts. One is certainly I, personally, 
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1 and I think NEMA, really appreciates the opportunity 

2 to participate in the negotiated rulemaking process. 

3 I think that was very educational. I mean I learned 

4 more about the transformer industry – even though I 

5 represent some of those manufacturers – and I 

6 personally learned more about the transformer 

7 industry that I didn’t know before, and I learned 

8 about the steel industry, and I learned about some 

9 of the perspectives of some of the advocates and 

10 other groups that were in the room. So I think, to 

11 me, it was a very constructive thing, and I think 

12 that was very valuable. 

13 I think the other aspect that was very 

14 valuable was the idea that the various consultants 

15 to DOE heard first hand how the data was being used 

16 and how the manufacturers, the steel producers, or 

17 other people interpreted the data, and where there 

18 were weaknesses and where there were flat out, what 

19 I would call, mistakes, and that they were able to 

20 correct some of those deficiencies in the course of 

21 doing the analysis. So I think that, in itself, 

22 helps give DOE a better chance of providing some 

23 rulemaking that is fairly rigorous in all the 

24 analysis that has been done. 

25 Speaking on behalf of NEMA, we came to the 

26 table dealing with a negotiated rulemaking session – 

27 sessions, and really had three things in mind. One 

28 is that we supported higher efficiency standards as 
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1 long as they could be proven that they were cost 

2 effective; two is that we really were concerned 

3 about the transformer industry in the U.S. as well 

4 as steel industry in the U.S. and we wanted to find 

5 some solutions where there was a balance, and we’ve 

6 talked about it a lot today, where there was a 

7 balance where the transformer manufacturers would 

8 have the flexibility to use different types of core 

9 steels, different types of designs, and different 

10 manufacturing techniques to be able to meet the 

11 efficiency standards. And the third thing was 

12 really dealing with the small manufacturers, 

13 particularly those dealing with the low voltage dry14 type transformers, and certainly we represent them 

15 as well as the big guys, and certainly don’t want to 

16 get into a position where we’re actually knocking 

17 them out of business and losing jobs for the U.S. 

18 So, from those three sort of core 

19 principles that we started with, and looking at all 

20 of the Navigant and LBL research, I feel that the – 

21 NEMA feels that the current NOPR really represents a 

22 good fit between all of those characteristics. So 

23 we certainly support the proposed rulemaking as it 

24 now stands with those proposed energy efficiency 

25 levels, and thank you for the opportunity to 

26 participate with all this. 

27 MR. BROOKMAN: Thank you. Yes, Richard. 

28 MR. PARKER: Yes, Richard Parker. I just 
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1 wanted to say this is probably my last hurrah for 

2 this process, but I wanted to say what a pleasure 

3 it’s been working with everybody here at the table. 

4 It was a difficult process. It was sort of a 

5 perfect storm of challenges, I think that this group 

6 faced, very, very complex issues, multiple 

7 stakeholders with very different perspectives, and 

8 combined with that some possibly radical tipping 

9 points which created a lot of anxiety as you 

10 approached them, and then on top of it all, of 

11 course, a very compressed time schedule which made 

12 it difficult to get the analysis right and then to 

13 refine the analysis in time to be ready for the next 

14 meeting and so forth. 

15 I thought the analysts did a fantastic 

16 job, dealing with the hand they were dealt, but it 

17 was very hard to do things in that time frame. And 

18 one lesson, I guess, the main lesson that I took 

19 away from this process is that might have been less 

20 work and less time for everybody had we been able to 

21 space the work out that we were doing over a longer 

22 time period, do more of it off-line, and less in 

23 plenary and get the analysis right before we come 

24 together and negotiate. 

25 But we are where we and I think the 

26 process did produce a lot of very useful information 

27 as well as a consensus on some small areas, and I 

28 think that’s in no small measure thanks to the great 
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1 work of people around this table and in the 

2 audience. So I just want to wish everybody the best 

3 as you go forward and I have no position on how the 

4 rule should come out, but I hope that we can get – 

5 you can get - the analysis and the rule to an 

6 outcome that is respected as legitimate and 

7 hopefully supported. But thanks again for the 

8 chance to work with you. 

9 MR. BROOKMAN: Steve Rosenstock. 

10 MR. ROSENSTOCK: Steve Rosenstock, EEI. 

11 Again, I just want to thank DOE for having the 

12 negotiation sessions and for Mr. Parker for his 

13 patience, and he’s still smiling after leading that 

14 session. I’m really surprised about that. Really 

15 appreciated all his hard work involved in 

16 negotiations. 

17 I also wanted to say again, I think that – 

18 I appreciate the nature of what DOE did for the 

19 negotiation, bringing in all the stakeholders, and I 

20 also want to remind people, I’m a numbers guy and I 

21 just remember that because of the last rule that DOE 

22 finalized in 2007 that went into effect in 2010, 

23 every time a utility, commercial customers, buying a 

24 new transformer, they’re going to be more efficient. 

25 That’s done. That’s locked in. Every time they 

26 replace an old transformer with a new transformer, 

27 there’s going to be more efficiency on our system. 

28 So I think we’ve already made a big 
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1 stride. As you’ll recall, certain parties with the 

2 advocates said, well, again, going back to the old 

3 rule, well Level two in 2009, Level four in 2013, 

4 and many of the levels that went into effect in 2010 

5 are already well past Level four, that’s a fact. 

6 That’s already in there. That’s done. So we’ve 

7 made a lot of progress already and we’re willing – I 

8 think all parties were willing to make some more 

9 progress here within that, those certain valid 

10 points, and I believe that, you know, I think all 

11 the parties are going to make comments, we’re going 

12 to make sure that the industries are competitive. 

13 We want – we like choice as consumers, we like 

14 choice, and we also like domestic manufacturing. 

15 They’re our customers too. 

16 So again, I appreciate all the work that 

17 everybody’s done. We look forward to making 

comments on April 10th 18 , and we look forward to a 

final rule being published by October 1st 19 . Thank 

20 you. 

21 MR. BROOKMAN: Robert. 

22 MR. BERMAN: Robert Berman, Berman 

23 Economics. If we can take a break from thank you’s 

24 for a moment, I have a technical question, trying to 

25 run some numbers. Would you explain, Chris, the 

26 role of tables Roman numerals I.5 and Federal

27 Register on page 7285 of the Federal Register 

28 versus Roman V.1 on 7342 of the Federal Register. 
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1 MR. BOLDUC: Can you read the titles – 

2 MR. BROOKMAN: 7285 and? 

3 MR. BERMAN: 7285 says, “Proposed 

4 electrical efficiencies for all liquid-immersed 

5 distribution equipment classes, compliance starting 

6 January 21, 2106.” And Table V.1 is efficiency 

7 values of the trial standard levels for liquid8 immersed transformers by design line. 

9 MR. BROOKMAN: What’s the second page, 

10 Robert? 

11 MR. BERMAN: I’m sorry, 7342. 

12 MR. BROOKMAN: Okay. Thank you. 

13 MR. BERMAN: I note for example, this is 

14 where we had the discrepancy in one of the places 

15 where we have a discrepancy in efficiency numbers. 

16 The 50 KVA, which is design line one, in the first 

17 table mentioned is 99.11 and the second table 

18 mentioned is 99.16. Is the second table the one 

19 where the efficiency analysis was done at? In other 

20 words, is that saying we did the analysis at EL-1 

21 and are proposing a 40 percent of standard EL-1, say 

22 for design line one? Is that what that’s saying? 

23 MR. ROSENSTOCK: It’s because of the 

24 scaling. Steve Rosenstock, EEI. Because of the 

25 smoothing, Mr. Berman, because of the smoothing. We 

26 discussed that earlier. 

27 MR. BOLDUC: The smoothing changed the 

28 efficiencies between the analysis and putting the 
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1 final editions together. 

2 MR. BERMAN: So we’re using the analysis 

3 at efficiency losses at 99.16 to do the savings for 

4 99.11? Is that correct? 

5 MR. BOLDUC: That sounds correct. 

6 MR. BERMAN: Okay. Thank you. 

7 MR. RIVEST: This is Mike Rivest. 

8 Remember what we’re looking at here are 

9 representative units. Three representative units 

10 for one product class, and so what I heard Steve say 

11 earlier on balance, some are going up, some are 

12 going down, so really, you know, when you take into 

13 account, in a typical analysis we have one 

14 representative for product class. Here we’ve 

15 disaggregated that into three representative units, 

16 so the economics aggregated for the three rep units, 

17 are representative for that product class. 

18 MR. BERMAN: That’s why I asked the 

19 question. 

20 MR. RIVEST: Okay. I just wanted to make 

21 sure that people were not making conclusions from 

22 what you were saying. 

23 MR. BROOKMAN: Robert, do you want to 

24 respond? 

25 MR. BERMAN: Robert Berman, Berman 

26 Economics. I’m just trying to clarify that what 

27 analysis was used on what design lines, and did we 

28 use the losses that we established at 99.16 to 
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1 attribute to the savings at 99.11. And I think you 

2 said yes to that, and that was my question, and 

3 that’s fine. 

4 MR. BROOKMAN: Before – just as we 

5 returned from lunch, Andrew deLaski said he had an 

6 issue that took us back to something said this 

7 morning. Did you want to raise that now, Andrew. 

8 MR. deLASKI: Yeah, and so – actually 

9 there’s two different – two – I suggested a number 

10 of new analyses today that I think the Department 

11 needs to conduct, and I’m not going to reiterate 

12 those now. I think I’ve been clear enough earlier 

13 and we’ll certainly reiterate them in our written 

14 comments. But I think doing those further analyses 

15 will help the Department get to a final rule that 

16 better – enables it in a better way to weigh the 

17 seven factors. 

18 Two things came up. One is that I’m a 

19 little struck that we didn’t hear anything today, 

20 nothing presented by the Department on the impacts 

21 on small manufacturers. We don’t have a slide on 

22 it, and we haven’t had any discussion – I mean, 

23 we’ve had very little discussion other than sort of 

24 cursory remarks, and given the weight the Department 

25 is giving to impacts on small manufacturers in its 

26 decision making process, I think it’s incumbent on 

27 the Department to do additional work to better 

28 document, better understand, what are the scale of 
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1 those impacts, and what are the – what are the 

2 impacts on small manufacturers. So I know there’s 

3 been some work done. It needs more. Phil and I 

4 were talking about this earlier, it needs more if 

5 it’s going to be the basis for decision-making. 

6 MR. BROOKMAN: I think Mike would like to 

7 follow on. 

8 MR. HYLAND: I just want to expand this. 

9 This is Mike Hyland at APPA. I’d like to expand 

10 that to small businesses in general. Of the 2000 

11 munis, 1950 are small businesses. The co-ops, I’m 

12 not sure the number, but it’s pretty impressive. 

13 It’s 500 or so. So you’re talking over 2000 small 

14 businesses which are the end consumers, which will 

15 be paying the freight of this with every dollar 

16 being passed on. So are we hitting the magic number 

17 of 100 million? Has that been evaluated yet, based 

18 on the cost increase? Has there been a small 

19 business analysis of how they’re affected? You 

20 increase the cost of the transformer by $100,000. 

21 Is that two jobs? Has that impact been analyzed? 

22 So if you’re going to look at small businesses, 

23 please don’t look at just manufacturing, because 

24 it’s the end consumer that has to pay. 

25 MR. BROOKMAN: Okay. Andrew, keep going. 

26 MR. deLASKI: The other thing is that in 

27 the TSD, in the engineering analysis, the Department 

28 raises the possibility that it may do a 
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1 reoptimization based on new pricing. It strikes us 

2 that that is likely to be a useful exercise to have 

3 optimization conducted based on the actual prices 

4 used in the analysis. We had discussion on prices 

5 during the engineering discussion. We talked about 

6 the need to fill in the gaps in the analysis so that 

7 – filling in those gaps is going to require doing 

8 optimization on new designs. And as the Department 

9 looks to fill those in, I think it needs to 

10 corroborate whether re-optimization will help it get 

11 to decisions based on results that reflect the 

12 material choices that are being made based on those 

13 prices. Might not have to do everything all over 

14 again, but you maybe could do some of it over again, 

15 based on the prices that you decide to use in the 

16 final rule analysis. 

17 So again, this is raised as a possibility 

18 in the TSD engineering analysis chapter. We think 

19 you’re raising the right question and we would 

20 encourage you to certainly do some additional 

21 reoptimization and perhaps do it soup-to-nuts, 

22 depending on whether that looks like it’s going to 

23 be valuable to you. 

24 MR. BROOKMAN: Andrew, does this conclude 

25 the other issue you wanted to raise? 

26 MR. deLASKI: That’s it. 

27 MR. BROOKMAN: Okay. Thank you. Yes, 

28 Charlie Stephens. 
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1 MR. STEPHENS: Charlie Stephens, Northwest 

2 Energy Efficiency Alliance. I just wanted to speak 

3 from a slightly different utility perspective, given 

4 that I work for 130-some of them, ranging all the 

5 way from the smallest, I imagine, of the rural ones, 

6 to some of the larger investor-owned utilities. 

7 There’s some confusion here it seems to me between 

8 consumer or customer or whatever, and the way it 

9 works where I am from is that the utilities have 

10 costs and they have benefits that derive from their 

11 investments, and the net of those is what flows 

12 through to the real consumers, which is the people 

13 who pay the bills and which is our rate payers. 

14 And so we’re focused, I have to say, much 

15 more on that level. You know, transformers don’t 

16 just cost more, they deliver benefits. They deliver 

17 efficiency savings, and those flow through the rates 

18 as well. It isn’t just cost that flows through to 

19 the rates. So we’re looking at, on balance, what 

20 are the benefits versus the cost, and I think a lot 

21 of people around the table are trying to do that. 

22 But some of us, if we really focus on that, what it 

23 does to our economy, and where the jobs really come 

24 from, and we’re very focused on that where I live 

25 right now. There are benefits that aren’t even 

26 counted in this rulemaking right now. I’m not going 

27 to go into them, but I think that’s a different – I 

28 seem to have a different customer or consumer 
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1 perspective here than some of the other utility 

2 representatives sitting around the table, and I 

3 don’t entirely understand that, but I just wanted to 

4 put the Northwest perspective on the record. Thank 

5 you. 

6 MR. BROOKMAN: We’ve heard a lot already 

7 today about different views of who the customer is, 

8 I hope we don’t need to rehash all of that. Steve. 

9 MR. ROSENSTOCK: Federal Register notice 

10 7286, footnote. “For the purposes of this document, 

11 the consumers of distribution transformers are 

12 referred to as customers. Customers refer to 

13 electric utilities, in the case of liquid-immersed 

14 transformers, and to utilities and building owners 

15 in the case of dry-type transformers.” I’ll just go 

16 on the dry-type side. Some of those owners could be 

17 retailers like WalMart and Sears and Home Depots, we 

18 consider them the customers of dry-type 

19 transformers. DOE has never done an analysis of 

20 “gee”, how will it affect the retail prices if the 

21 transformer is more efficient? It would just be an 

22 impossible analysis to do, because the end use 

23 customer going into that store is not the customer 

24 of the product. The entity that is buying the 

25 product, operating it, and maintaining it is the 

26 customer. Thank you. 

27 MR. BROOKMAN: Thank you. Yes, Mike. 

28 MR. HYLAND: Yes, I just wanted to tap 
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1 into what he said. My CEO is from the Northwest, 

2 and he – they’re one of the largest utilities and 

3 he’s in sync with what we’re saying here. So we do 

4 have an overlap in membership. It ties into what 

5 Steve had said. We’ve already come up so far from 

6 2007, and you start looking at what are you going to 

7 do with the next dollar. As Rick Anderson said, 

8 who’s not here, but I know he’s on the phone from 

9 Fayetteville, is what’s your biggest bang for your 

10 buck at this point. And we’re arguing over 99.82, 

11 99.84, when you can look at any municipality, or any 

12 utility in this room, the end consumer, based on 

13 what this says, would have a better time helping 

14 Andrew’s goals by putting a dollar elsewhere at this 

15 point. What are they getting per watt? How much is 

16 it costing them to save a watt at this point, versus 

17 putting that dollar to something else in these 

18 communities? 

19 MR. BROOKMAN: Okay. Thank you. I think 

20 we’re at the point where we’re hearing traditional 

21 and perhaps final comments. Any other issues that 

22 people wish to raise? Because I think we’re 

23 starting to double back on ourselves here. Closing 

24 remarks. Yes, Bob. 

25 MR. SAINT: I agree that we have been 

26 doing closing remarks for some time, and so – 

27 MR. BROOKMAN: Thank you. 

28 MR. SAINT: -- and I – 
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1 MR. BROOKMAN: This is the only thing 

2 which I’m allowed to achieve a consensus. 

3 MR. SAINT: -- and I too would like to 

4 congratulate everybody in the room for the diligence 

5 and hard work that we’ve all done, and DOE, and the 

6 consultants, and the negotiation team, and we’ve all 

7 come to, I think, a better understanding of each 

8 other’s issues through this process than we all 

9 realized. 

10 There are some points that – and we do 

11 think that DOE came to the right conclusion when 

12 they did their analysis, and congratulate them for 

13 their levels that they’ve chosen in this NOPR, and 

14 encourage them to hold fast with those 

15 recommendations. Most everybody in the room has 

16 agreed with them. There are a few exceptions, but 

17 the vast majority of the people in the room, and I 

18 believe the vast majority of the comments that you 

19 will receive agrees with your analysis and the 

20 diligence that you’ve gone through to come up with 

21 these efficiency levels and we hope that you will 

22 hold fast with these. 

23 The issues that we see that are important 

24 are maintaining a robust, competitive, competition 

25 among suppliers, and we’ve been talking about steel 

26 manufacturers versus amorphous-core manufacturers 

27 for a while, and we do think that we need to have 

28 that robust competition. In addition, we feel 
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1 strongly that we need to – the small transformer 

2 manufacturers themselves need to remain competitive, 

3 and we have a concern that if one – if amorphous4 core transformers become the only transformers that 

5 are competitive to be made, then those small 

6 manufacturers will go out of business, and those 

7 small businesses will not be able to exist. 

8 We have a couple of members that are 

9 transformer manufacturers and we really feel that we 

10 should support our members, small transformer 

11 manufacturers. 

12 Of course, the other part of the analysis 

13 is the life-cycle cost and the total owning cost of 

14 these transformers, and there’s where we see some 

15 issues with that. There’s been a lot of analysis, a 

16 lot of input given on the costs. We feel like 

17 there’s still inconsistencies in the costs that are 

18 used in the analysis, for example, the material 

19 costs seem to be fairly low versus the power costs 

20 are high, and that very much skews the results of 

21 the analysis, so we really question the credibility 

22 and the viability of that analysis. 

23 So we’re – since we have trouble looking 

24 at these life-cycle cost issues and the total owning 

25 cost analysis, we go back to the competition, and 

26 that seems a little more clear, at least to some, 

27 that dividing point, and that’s where the DOE has 

28 come on. So even though there seems to be more 
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1 emphasis on this robust competition among suppliers, 

2 core suppliers, and that seems to be a lot of the 

3 issue, that is because we still have problems with 

4 credibility of the life-cycle cost analysis, so we 

5 keep going back to the robust competition. 

6 And we can’t, lastly, we really can’t 

7 ignore the issue of the refurbished transformers and 

8 the fact that if the original cost of transformers 

9 get too high – and nobody knows what too high is – 

10 but at some point the market for these transformers 

11 is going to become a dominant market, and no one 

12 wants that, no one in this room wants that. And 

13 that kind of defeats the purpose of this whole 

14 rulemaking if we price these efficient transformers 

15 out of the market and people find an alternative to 

16 these transformers that are regulated, it really 

17 defeats the purpose of the whole thing. And if we 

18 want to include those transformers or not, I think 

19 that’s an issue that will take a long time, and it’s 

20 a tough legal decision that apparently DOE has 

21 looked at several times and decided fairly clearly 

22 that they can’t regulate the refurbished 

23 transformers. 

24 So, again, thank everybody for all our 

25 diligence, and we’ll be submitting the comments and 

26 encouraging our members to submit comments as well, 

27 and hope for the best. Thank you very much. 

28 MR. BROOKMAN: Thank you. Additional 
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1 closing remarks. Phil. 

2 MR. HOPKINSON: Phil Hopkinson, HVOLT, 

3 Inc. One thing that I might add is that several 

4 years ago I went to an IEEE ad hoc meeting and came 

5 out chairman of a group that was addressed at 

6 looking at issues associated with DOE energy 

7 efficiency activities for distribution transformers. 

8 We have a meeting coming up and I think that it is 

March 13th 9 , in Nashville, for IEEE, and a good many 

10 of the people who have been right here, as well as a 

11 lot more – I typically have about 100 people that 

12 come into the meeting and they are manufacturers, 

13 most of which didn’t get a chance to sit in here, 

14 but will be there, and users, many of which again, 

15 didn’t get a chance to come here, but they’ll be 

16 there. And they really look forward to these 

17 sessions to be able to find out what’s going on in 

18 the first place, and are likely to have comments 

19 back that can be useful. I’ll do my best to capture 

20 those and certainly send them in, and I think there 

21 will be others that will do that from these 

22 meetings. 

23 I’m very complimentary of the process that 

24 went on to get to this point, and of course Richard 

25 Parker, I think, has done a wonderful job with the 

26 negotiations. I’m impressed with the quads of 

27 energy that actually were saved, because way back in 

28 1991 I went to the first task force, Congressional 
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1 task force, where energy efficiency activities were 

2 kicked off, and we struggled to find even the first 

3 quad of energy savings back with the group as we 

4 started out, so we made a tremendous progress in the 

5 rulemakings that went in in 2007 and 2010, but 

6 clearly we’ve got another big jump with what the 

7 proposals are here. 

8 Again, I think that from all of the 

9 experience that I’ve had in this industry, that it 

10 is a tremendous balance between the efficiency 

11 savings that we all would like to see happen, and 

12 the impact on the market place and on the players in 

13 the market place, and the materials and so on. I 

14 really believe that – and that’s why I wrote such a 

15 complimentary letter well deserved – that this is a 

16 very, very excellent rule. I would certainly 

17 propose that you stick at that rule. Thank you. 

18 MR. BROOKMAN: Final remarks. Additional 

19 final remarks? Yes, Steve Rosenstock. 

20 MR. ROSENSTOCK: Steve Rosenstock, EEI. 

21 Just another thing on the process, I also want to 

22 thank DOE for having – doing more of these with 

23 webinars. We have members from all over the 

24 country, and I know that they appreciate being able 

25 to listen in and see the slides, because it helps 

26 them with some of their comments as well. You know, 

27 budgets can be very tight, and this really allows 

28 more participation, more stakeholder input, I 
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1 believe, so again, thank you for making that a 

2 regular part of this process. 

3 MR. BROOKMAN: Thank you. Anything else. 

4 Okay, then, from my part, one of our traditions is 

5 to distribute evaluation forms. The Department 

6 very much wants to hear what you think about these 

7 proceedings and how it can be improved. And 

8 speaking for myself, I’d just like to thank you 

9 all. This has been a very, very productive 

10 meeting. People spoke plainly and directly to the 

11 issues at hand. I’d also compliment the 

12 negotiators. I always think of negotiation as a 

13 good thing, and so there was a lot of effort, a 

14 very compressed time period. I’d also, as a 

15 consultant that works all over the federal sector, 

16 I’d like to acknowledge DOE’s leadership. It’s not 

17 easy for them to do things differently, and they 

18 deserve a lot of credit for giving this a chance 

19 and so, I will turn it back then to Jim Raba for 

20 closing remarks and my thanks to all of you, safe 

21 travels. 

22 MR. RABA: Well thank you, Doug, for being 

23 our facilitator for today. It’s been a very 

24 productive and challenging meeting with the fire 

25 drill in between, but still you got it done, and we 

26 appreciate that, and thank you who participated 

27 throughout this process. Very thoughtful 

28 participation, and remember at this NOPR stage 
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1 we’ve just gone through, or going through now, it’s 

2 a Notice of Proposed Rulemaking, not a Notice of 

3 Perfect Rulemaking. You have offered many good 

4 comments, very helpful comments. We’re not 

5 perfect, but we all believe, I think, this has been 

6 the best part of the NPR: “negotiated proposed 

7 rulemaking,” and you worked in good faith 

8 throughout. It’s been most worthy. Now we look 

9 towards a final rule, maybe an NPR - nearly perfect 

10 rulemaking, and thank you very much. 

11 (Whereupon, at 3:30 p.m., the meeting in 

12 the above captioned matter was adjourned.) 

13 

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REPORTER'S CERTIFICATE

 This is to certify that the attached proceedings 

before: 

U.S. DEPARTMENT OF ENERGY 

In the Matter of: 

PUBLIC MEETING ON ENERGY CONSERVATION STANDARDS 

PROPOSED RULEMAKING FOR DISTRIBUTION TRANSFORMERS 

 Were held as herein appears and that this is the 

original transcript thereof for the file of the 

Department, Commission, Board, Administrative Law 

Judge or the Agency. 

 Further, I am neither counsel for or related to 

any party to the above proceedings. 

 

 

Debra Derr

 Official Reporter 

Dated: February 28, 2012