CHAPTER 5. ENGINEERING ANALYSIS

TABLE OF CONTENTS

**5.1 INTRODUCTION** 

**........................................................................................................... 5­1** 

**5.2 EQUIPMENT**  **CLASSES ANALYZED..........................................................................**  **5­2**

**5.2.1 Representative**  **Cooling Capacities**  **and Wall**  **Sleeve Dimensions....................... 5­4** 

**5.2.1.1 Standard**  **Size PTAC**  **and PTHP**  **Representative Equipment** 

**................... 5­5** 

**5.2.1.2 Non­Standard**  **Size PTAC**  **and PTHP**  **Representative Equipment** 

**........... 5­6** 

**5.3 METHODOLOGY**  **OVERVIEW**

**.................................................................................... 5­7** 

**5.4 TEARDOWN**  **ANALYSIS.............................................................................................. 5­9**

**5.4.1 Selection**  **of Units.................................................................................................**  **5­9**

**5.4.2 Generation**  **of Bills**  **of Materials** 

**........................................................................ 5­10** 

**5.5 DESIGN**  **OPTIONS**

**....................................................................................................... 5­10** 

**5.5.1 Screened­In**  **Technologies.................................................................................. 5­11** 

**5.5.1.1 Higher**  **Efficiency Compressors............................................................. 5­11**

**5.5.1.2 Increase**  **Heat Exchanger**  **Area............................................................... 5­11**

**5.5.1.3 Re­Circuiting**  **Heat Exchanger**  **Coils**

**..................................................... 5­12** 

**5.6 COST**  **MODEL AND**  **DEFINITIONS........................................................................... 5­12** 

**5.6.1 Cost**  **Definitions**

**................................................................................................. 5­12** 

**5.6.2 Cost**  **Model Overview........................................................................................ 5­13** 

**5.6.3 Cost**  **Model Estimations**  **Overview**

**.................................................................... 5­14** 

**5.6.4 Outsourcing**  **Assumptions.................................................................................. 5­15**

**5.6.5 Factory**  **Parameters Assumptions.......................................................................**  **5­16**

**5.6.6 Production**  **Volumes Assumptions.....................................................................**  **5­17**

**5.6.7 Material**  **Prices Assumptions** 

**............................................................................. 5­18** 

**5.6.8 MPC**  **Breakdown................................................................................................ 5­19** 

**5.7 ENGINEERING**  **MANUFACTURER INTERVIEWS................................................. 5­19** 

**5.7.1 Key Issues Discussed......................................................................................... 5­20** 

**5.8 MANUFACTURER**  **MARKUP**

**.................................................................................... 5­21** 

**5.8.1 Manufacturer**  **Financial Information**  **Sources**

**.................................................... 5­22** 

**5.8.2 Manufacturing Production Cost......................................................................... 5­22** 

**5.8.3 Manufacturer**  **Selling Price** 

**................................................................................ 5­24** 

**5.8.4 Manufacturing**  **Markup Calculation...................................................................**  **5­24**

**5.9 COST**  **VERSUS EFFICIENCY**  **CURVES**

**.................................................................... 5­26** 

**5.9.1 Baseline**  **Unit...................................................................................................... 5­26** 

**5.9.2 “Max**  **Tech” Efficiency**  **Levels**

**.......................................................................... 5­28** 

**5.9.3 Design**  **Option Approach** 

**................................................................................... 5­29** 

**5.9.4 Cost­Efficiency Curves...................................................................................... 5­31** 

**5.10 ALTERNATIVE**  **REFRIGERANT ANALYSIS** 

**.......................................................... 5­37** 

**5.10.1 Alternative**  **Refrigerant Selection** 

**...................................................................... 5­38** 

**5.10.2 R­410A**  **Feedback from**  **Manufacturers**

**............................................................. 5­39** 

**5.10.3 R­410A**  **Compressors......................................................................................... 5­39** 

**5.10.4 AHRI**  **R­410A Study..........................................................................................**  **5­40**

**5.10.5 R­410**  **Confidential Data**  **Submitted by**  **Manufacturers**

**..................................... 5­41** 

**5­i 5.10.6**  **R­410A Analysis**  **Methodology**

**......................................................................... 5­41** 

**5.10.7 R­410A**  **Equipment Performance.......................................................................**  **5­43**

**5.10.8 R­410A Max Tech Efficiency Levels................................................................ 5­46** 

**5.10.9 R­410A**  **Analysis................................................................................................ 5­47** 

**5.10.10 R­410A Cost­Efficiency Curves................................................................ 5­48** 

**5.11 HEAT**  **PUMP EER**  **TO HEAT**  **PUMP COP..................................................................**  **5­55**

**5.12 SENSITIVITY**  **ANALYSES**

**......................................................................................... 5­57** 

**5.13 ENGINEERING**  **ANALYSIS SUMMARY**  **OF RESULTS..........................................**  **5­71**

LIST OF TABLES

**Table 5.2.1**  **Equipment Classes**  **for PTACs** 

**................................................................................ 5­3** 

**Table 5.2.2**  **Equipment Classes**  **for PTHPs................................................................................. 5­3** 

**Table 5.5.1**  **Technologies Not**  **Screened Out** 

**............................................................................ 5­11** 

**Table 5.5.2**  **Increase Heat**  **Exchanger Area**  **Design Options......................................................**  **5­12**

**Table 5.6.1**  **Cost Model**  **In­House Manufacturing**  **Operation Assumptions** 

**.............................. 5­16** 

**Table 5.6.2**  **Standard Size**  **PTAC and**  **PTHP Factory**  **Parameter Assumptions** 

**........................ 5­17** 

**Table 5.6.3 Non­Standard Size PTAC and PTHP Factory Parameter Assumptions................ 5­17** 

**Table 5.6.4**  **Five­Year Metal**  **Prices**

**.......................................................................................... 5­18** 

**Table 5.6.5**  **Resin Prices**  **as of**  **June 2008..................................................................................**  **5­19**

**Table 5.6.6**  **Total Equipment**  **MPC Breakdown........................................................................**  **5­19**

**Table 5.8.1**  **Gross Profit**  **Margin for**  **PTAC and**  **PTHP Manufacturers** *

**.................................. 5­25** 

**Table 5.8.2**  **Calculated Manufacturer**  **Markups**

**........................................................................ 5­26** 

**Table 5.9.1**  **Market Baseline**  **Units Characteristics...................................................................**  **5­27**

**Table 5.9.2**  **Baseline Unit**  **EER................................................................................................. 5­28** 

**Table 5.9.3**  **“Max Tech”**  **Efficiency Levels**  **utilizing R­22**  **(≥7,000 Btu/h**  **and ≤15,000**  **Btu/h**

**Equipment Classes)....................................................................................................................**  **5­29**

**Table 5.9.4**  **Standard Size**  **PTAC 9,000**  **Btu/h Cooling**  **Capacity R­22**  **Refrigerant Design** 

**Options....................................................................................................................................... 5­30** 

**Table 5.9.5**  **Standard Size**  **PTHP 9,000**  **Btu/h Cooling**  **Capacity R­22**  **Refrigerant Design** 

**Options....................................................................................................................................... 5­30** 

**Table 5.9.6**  **Standard Size**  **PTAC 12,000**  **Btu/h Cooling**  **Capacity R­22**  **Refrigerant Design** 

**Options....................................................................................................................................... 5­30** 

**Table 5.9.7**  **Standard Size**  **PTHP 12,000**  **Btu/h Cooling**  **Capacity R­22**  **Refrigerant Design** 

**Options....................................................................................................................................... 5­31** 

**Table 5.9.8**  **Non­Standard Size**  **PTAC 11,000**  **Btu/h Cooling**  **Capacity R­22**  **Refrigerant Design** 

**Options....................................................................................................................................... 5­31** 

**Table 5.9.9**  **Non­Standard Size**  **PTHP 11,000**  **Btu/h Cooling**  **Capacity R­22**  **Refrigerant Design** 

**Options....................................................................................................................................... 5­31** 

**Table 5.9.10**  **Cost­Efficiency Curves**  **and Corresponding**  **Figures for**  **PTAC and**  **PTHP**

**Equipment Utilizing**  **R­22.......................................................................................................... 5­32** 

**Table 5.10.1**  **AHRI Estimated**  **R­410A System**  **EER Degradation**  **for PTACs**  **and PTHPs** 

**..... 5­40** 

**Table 5.10.2 AHRI Estimated R­410A System COP Degradation for PTACs and PTHPs..... 5­40** 

**Table 5.10.3**  **“Max Tech”**  **Efficiency Levels**  **utilizing R­410A**  **(≥7,000 Btu/h**  **and ≤15,000**  **Btu/h**

**Equipment Classes)....................................................................................................................**  **5­47**

**Table 5.12.1**  **Annual Average**  **2008 Metal**  **Prices**

**..................................................................... 5­58** 

**5­ii Table**  **5.12.2 Material**  **Price Sensitivity**  **Results......................................................................... 5­71** 

**Table 5.13.1**  **MSP for**  **R­22 and**  **R­410A Standard**  **Size PTACs**  **with a**  **9,000 Btu/h**  **Cooling**

**Capacity**

**............................................................................................................................... ......**  **5­71**

**Table 5.13.2**  **MSP for**  **R­22 and**  **R­410A Standard**  **Size PTHPs**  **with a**  **9,000 Btu/h**  **Cooling**

**Capacity**

**............................................................................................................................... ......**  **5­72**

**Table 5.13.3**  **MSP for**  **R­22 and**  **R­410A Standard**  **Size PTACs**  **with a**  **12,000 Btu/h**  **Cooling**

**Capacity**

**............................................................................................................................... ......**  **5­72**

**Table 5.13.4**  **MSP for**  **R­22 and**  **R­410A Standard**  **Size PTHPs**  **with a**  **12,000 Btu/h**  **Cooling**

**Capacity**

**............................................................................................................................... ......**  **5­72**

**Table 5.13.5**  **MSP for**  **R­22 and**  **R­410A Non­Standard**  **Size PTACs**  **11,000 Btu/h**  **Cooling**

**Capacity**

**............................................................................................................................... ......**  **5­72**

**Table 5.13.6**  **MSP for**  **R­22 and**  **R­410A Non­Standard**  **Size PTHPs**  **11,000 Btu/h**  **Cooling**

**Capacity**

**............................................................................................................................... ......**  **5­73**

**Table 5.13.7**  **Increase in**  **MSP from**  **R­22 to**  **R­410A for**  **the Various**  **Equipment**

**................... 5­73** 

LIST OF FIGURES

**Figure 5.2.1**  **Annual Number**  **of Shipments**  **for Standard**  **Size PTACs**  **by Cooling**  **Capacity**

**– AHRI,**  **December 2006** 

**................................................................................................................ 5­5** 

**Figure 5.2.2**  **Annual Number**  **of Shipments**  **for Standard**  **Size PTHPs**  **by Cooling**  **Capacity**

**– ARHI,**  **December 2006** 

**................................................................................................................ 5­6** 

**Figure 5.3.1**  **Flow Diagram**  **of Engineering**  **Analysis Methodology** 

**........................................... 5­8** 

**Figure 5.8.1**  **Full Production**  **Costs**

**............................................................................................ 5­23** 

**Figure 5.9.1**  **Manufacturer Production**  **Cost (2007$)**  **versus Efficiency**  **for Standard**  **Size PTACs** 

**with a**  **Cooling Capacity**  **of 9,000**  **Btu/h, R­22**  **Refrigerant**

**....................................................... 5­32** 

**Figure 5.9.2**  **Manufacturer Production**  **Cost (2007$)**  **versus Efficiency**  **for Standard**  **Size PTHPs** 

**with a**  **Cooling Capacity**  **of 9,000**  **Btu/h, R­22**  **Refrigerant**

**....................................................... 5­33** 

**Figure 5.9.3**  **Manufacturer Production**  **Cost (2007$)**  **versus Efficiency**  **for Standard**  **Size PTACs** 

**with a**  **Cooling Capacity**  **of 12,000**  **Btu/h, R­22**  **Refrigerant**

**..................................................... 5­34** 

**Figure 5.9.4**  **Manufacturer Production**  **Cost (2007$)**  **versus Efficiency**  **for Standard**  **Size PTHPs** 

**with a**  **Cooling Capacity**  **of 12,000**  **Btu/h, R­22**  **Refrigerant**

**..................................................... 5­35** 

**Figure 5.9.5**  **Manufacturer Production**  **Cost (2007$)**  **versus Efficiency**  **for Non­Standard**  **Size**

**PTACs with**  **a Cooling**  **Capacity of**  **11,000 Btu/h,**  **R­22 Refrigerant** 

**........................................ 5­36** 

**Figure 5.9.6**  **Manufacturer Production**  **Cost (2007$)**  **versus Efficiency**  **for Non­Standard**  **Size**

**PTHPs with**  **a Cooling**  **Capacity of**  **11,000 Btu/h,**  **R­22 Refrigerant.........................................**  **5­37**

**Figure 5.10.1**  **Equipment Performance**  **of Standard**  **Size PTACs**  **Utilizing R­22**  **and R­410A** 

**Refrigerant ­ 2008**  **AHRI Directory and**  **Engineering Analysis Performance**  **Degradations..... 5­43**

**Figure 5.10.2**  **Equipment Performance**  **of Standard**  **Size PTHPs**  **Utilizing R­22**  **and R­410A** 

**Refrigerant ­ 2008**  **AHRI Directory and**  **Engineering Analysis Performance**  **Degradations..... 5­44**

**Figure 5.10.3**  **Equipment Performance**  **of Non­Standard**  **Size PTACs**  **Utilizing R­22**  **and R­410A** 

**Refrigerant**

**– Manufacturers’**  **Catalogs and**  **Engineering Analysis**  **Performance Degradations**  **5­45**

**Figure 5.10.4**  **Equipment Performance**  **of Non­Standard**  **Size PTHPs**  **Utilizing R­22**  **and R­410A** 

**Refrigerant**

**– Manufacturers’**  **Catalogs and**  **Engineering Analysis**  **Performance Degradations**  **5­46**

**Figure 5.10.5**  **Manufacturer Production**  **Cost (2007$)**  **versus Efficiency**  **for R­410A**  **Standard**

**Size PTACs**  **with a**  **Cooling Capacity**  **of 9,000**  **Btu/h................................................................ 5­49** 

**5­iii Figure**  **5.10.6 Manufacturer**  **Production Cost**  **(2007$) versus**  **Efficiency for**  **R­410A Standard** 

**Size PTHPs**  **with a**  **Cooling Capacity**  **of 9,000**  **Btu/h**

**................................................................ 5­50** 

**Figure 5.10.7**  **Manufacturer Production**  **Cost (2007$)**  **versus Efficiency**  **for R­410A**  **Standard**

**Size PTACs**  **with a**  **Cooling Capacity**  **of 12,000**  **Btu/h.............................................................. 5­51** 

**Figure 5.10.8**  **Manufacturer Production**  **Cost (2007$)**  **versus Efficiency**  **for R­410A**  **Standard**

**Size PTHPs**  **with a**  **Cooling Capacity**  **of 12,000**  **Btu/h**

**.............................................................. 5­52** 

**Figure 5.10.9**  **Manufacturer Production**  **Cost (2007$)**  **versus Efficiency**  **for R­410A**  **Non**

**Standard Size**  **PTACs with**  **a Cooling**  **Capacity of**  **11,000 Btu/h** 

**.............................................. 5­53** 

**Figure 5.10.10**  **Manufacturer Production**  **Cost (2007$)**  **versus Efficiency**  **for R­410A**  **Non**

**Standard Size**  **PTHPs with**  **a Cooling Capacity of**  **11,000 Btu/h............................................... 5­54** 

**Figure 5.11.1**  **COP versus**  **EER for**  **Standard Size**  **PTHPs with**  **9,000 Btu/h**  **Cooling Capacity** 

**from 2008**  **AHRI directory.........................................................................................................**  **5­56**

**Figure 5.11.2**  **COP versus**  **EER for**  **Standard Size**  **PTHPs with**  **12,000 Btu/h**  **Cooling Capacity** 

**from 2008**  **AHRI directory.........................................................................................................**  **5­56**

**Figure 5.11.3**  **COP versus**  **EER for**  **Non­Standard Size**  **PTHPs All**  **Cooling Capacity**  **from 2008** 

**AHRI directory** 

**.......................................................................................................................... 5­57** 

**Figure 5.12.1**  **Material Price**  **Sensitivity for**  **Standard Size**  **PTACs with**  **a Cooling**  **Capacity of** 

**9,000 Btu/h**  **and R­410A**  **Refrigerant......................................................................................... 5­59** 

**Figure 5.12.2**  **Material Price**  **Sensitivity for**  **Standard Size**  **PTACs with**  **a Cooling**  **Capacity of** 

**9,000 Btu/h**  **and R­22**  **Refrigerant.............................................................................................. 5­60** 

**Figure 5.12.3**  **Material Price**  **Sensitivity for**  **Standard Size**  **PTHPs with**  **a Cooling**  **Capacity of** 

**9,000 Btu/h**  **and R­410A**  **Refrigerant......................................................................................... 5­61** 

**Figure 5.12.4**  **Material Price**  **Sensitivity for**  **Standard Size**  **PTHPs with**  **a Cooling**  **Capacity of** 

**9,000 Btu/h**  **and R­22**  **Refrigerant.............................................................................................. 5­62** 

**Figure 5.12.5**  **Material Price**  **Sensitivity for**  **Standard Size**  **PTACs with**  **a Cooling**  **Capacity of** 

**12,000 Btu/h**  **and R­410A**  **Refrigerant....................................................................................... 5­63** 

**Figure 5.12.6**  **Material Price**  **Sensitivity for**  **Standard Size**  **PTACs with**  **a Cooling**  **Capacity of** 

**12,000 Btu/h**  **and R­22**  **Refrigerant............................................................................................ 5­64** 

**Figure 5.12.7**  **Material Price**  **Sensitivity for**  **Standard Size**  **PTHPs with**  **a Cooling**  **Capacity of** 

**12,000 Btu/h**  **and R­410A**  **Refrigerant....................................................................................... 5­65** 

**Figure 5.12.8**  **Material Price**  **Sensitivity for**  **Standard Size**  **PTHPs with**  **a Cooling**  **Capacity of** 

**12,000 Btu/h**  **and R­22**  **Refrigerant............................................................................................ 5­66** 

**Figure 5.12.9**  **Material Price**  **Sensitivity for**  **Non­Standard Size**  **PTACs with**  **a Cooling**  **Capacity**

**of 11,000**  **Btu/h and**  **R­410A Refrigerant** 

**.................................................................................. 5­67** 

**Figure 5.12.10**  **Material Price**  **Sensitivity for**  **Non­Standard Size**  **PTACs with**  **a Cooling**  **Capacity**

**of 11,000**  **Btu/h and**  **R­22 Refrigerant** 

**....................................................................................... 5­68** 

**Figure 5.12.11**  **Material Price**  **Sensitivity for**  **Non­Standard Size**  **PTHPs with**  **a Cooling**  **Capacity**

**of 11,000**  **Btu/h and**  **R­410A Refrigerant** 

**.................................................................................. 5­69** 

**Figure 5.12.12**  **Material Price**  **Sensitivity for**  **Non­Standard Size**  **PTHPs with**  **a Cooling**  **Capacity**

**of 11,000**  **Btu/h and**  **R­22 Refrigerant** 

**....................................................................................... 5­70** 

**5­iv**CHAPTER 5. ENGINEERING ANALYSIS

5.1 INTRODUCTION

**The engineering**  **analysis establishes**  **the relationship**  **between the**  **manufacturer production** 

**cost (MPC)**  **and the**  **energy efficiency**  **of packaged**  **terminal air**  **conditioners (PTACs)**  **and**

**packaged terminal**  **heat pumps**  **(PTHPs). The**  **relationship between**  **the MPC**  **and energy** 

**efficiency, or**  **cost­efficiency relationship,**  **serves as**  **the basis**  **for cost­benefit**  **calculations in** 

**terms of**  **individual customers,**  **manufacturers, and**  **the Nation.** 

**To establish**  **the industry**  **cost­efficiency curves,**  **the U.S.**  **Department of**  **Energy (DOE)** 

**used a**  **combination of**  **reverse engineering**  **and design**  **option approach.**  **DOE gathered** 

**information using**  **reverse engineering**  **methodologies, equipment**  **information from**  **manufacturer**

**catalogs, and**  **discussions with**  **experts and**  **PTAC and**  **PTHP manufacturers.**  **The reverse** 

**engineering or**  **cost assessment**  **provides useful**  **information, including**  **identification of**  **potential**

**technology paths**  **manufacturers use**  **to increase**  **efficiency. DOE**  **generated a**  **bill of**  **materials**

**(BOMs) by**  **disassembling multiple**  **manufacturers’ PTACs**  **and PTHPs**  **that span**  **a range**  **of**

**efficiency levels.**  **The BOMs**  **describe the**  **equipment in**  **detail, including**  **all manufacturing**  **steps**

**required to**  **make and/or**  **assemble each**  **part. Subsequently,**  **DOE developed**  **a cost**  **model that** 

**converted the**  **BOMs and**  **the design**  **options identified**  **in the**  **screening analysis**  **(Chapter 4)**  **into**

**MPCs. By**  **applying derived**  **manufacturer markups**  **to the**  **MPCs, DOE**  **calculated the** 

**manufacturer selling**  **prices (MSPs)**  **and constructed**  **industry cost­efficiency**  **curves.**

**In a**  **subsequent life­cycle**  **cost analysis**  **(Chapter 8),**  **DOE used**  **the cost­efficiency**  **curves**

**to determine**  **customer prices**  **for PTAC**  **and PTHP**  **equipment by**  **applying distribution**  **channel**

**markups.**

**The Energy**  **Policy and**  **Conservation Act**  **of 1975**  **(EPCA) establishes**  **energy**

**conservation standards**  **for PTACs**  **and PTHPs**  **under 42**  **U.S.C. 6313(a)(3)(A)**  **and (B).**  **These**

**standards are**  **measured and**  **expressed in**  **terms of**  **energy­efficiency ratio**  **a (EER)**  **and coefficient** 

**of performance**  **b (COP)**  **under 42**  **U.S.C. 6314(a)(4)(A).**  **In conducting**  **the engineering**  **analysis,**

**a According**  **to the**  **Air­Conditioning and**  **Refrigeration Institute**  **(ARI) 310/380­2004**  Standard for Packaged

Terminal Air­Conditioners and Heat Pumps **(ARI 310/380­2004)**  **test procedure,**  **EER is**  **defined as**  **“the ratio**  **of the** 

**produced cooling**  **effect of**  **an air**  **conditioner or**  **heat pump**  **to its**  **net work**  **input, expressed**  **in Btu/watt­hour.”** 

**b COP**  **is defined**  **by ARI**  **310/380­2004 as**  **“the ratio**  **of the**  **produced cooling**  **effect of**  **an air**  **conditioner or**  **heat**

**pump (or**  **its produced**  **heating effect,**  **depending on**  **the mode**  **of operation)**  **to its**  **net work**  **input, when**  **both the** 

**cooling (or**  **heating) effect**  **and the**  **net work**  **input are**  **expressed in**  **identical units**  **of measurement.”** 

**5­1 DOE**  **only considered**  **equipment that**  **includes technologies**  **and techniques**  **that improve**  **the EER** 

**and COP**  **of PTAC**  **and PTHP**  **equipment. As**  **mentioned in**  **the screening**  **analysis (Chapter**  **4),**

**there are**  **potential energy**  **savings associated**  **with certain**  **technology options**  **and techniques**  **that**

**can reduce**  **the annual**  **energy consumption**  **of the**  **system, but**  **these technologies**  **generally have** 

**little effect**  **on EER.**  **DOE did**  **not consider**  **technology options**  **that reduce**  **or have**  **negligible**

**effects on**  **EER and**  **COP.**

**As part**  **of the**  **engineering analysis,**  **DOE analyzed**  **the cost­efficiency**  **relationship**

**associated with**  **the use**  **of an**  **alternative refrigerant**  **by the**  **covered equipment.**  **Using**

**information gathered**  **from manufacturers,**  **literature research,**  **and current**  **refrigerant cost** 

**efficiency relationships,**  **DOE made**  **estimates to**  **calculate the**  **cost­efficiency relationship**  **for the** 

**alternative refrigerant**  **equipment.**

**In this**  **chapter, DOE**  **discusses the**  **equipment classes**  **analyzed, the**  **identification of** 

**representative equipment,**  **the methodology**  **used to**  **generate bills**  **of materials**  **and MPCs,**  **the**

**identification of**  **baseline equipment,**  **the process**  **for constructing**  **industry cost­efficiency**  **curves,**

**the analysis**  **of industry**  **cost­efficiency curves**  **of equipment**  **that uses**  **an alternative**  **refrigerant,**

**and the**  **sensitivity analysis**  **completed for**  **material prices**  **of PTACs**  **and PTHPs.**  **The results**  **of**

**the engineering**  **analysis are**  **several cost­efficiency**  **curves that**  **represent the**  **average incremental** 

**cost of**  **increasing energy**  **efficiency levels**  **above the**  **baseline levels.** 

5.2 EQUIPMENT CLASSES ANALYZED

**Existing Federal**  **energy conservation**  **standards, shown**  **in Tables**  **1 and**  **2 of**  **the 10**  **CFR**

**Part 431.97,**  **divide PTACs**  **and PTHPs**  **into six**  **equipment classes.**  **These equipment**  **classes are** 

**differentiated by**  **equipment (i.e.,**  **air conditioner**  **or heat**  **pump) and**  **by cooling**  **capacity in**  **British**

**thermal unit**  **per hour**  **(Btu/h). As**  **presented in**  **the market**  **and technology**  **assessment (MTA)** 

**(Chapter 3),**  **DOE is**  **dividing EPCA’s**  **existing classes**  **for this**  **equipment by**  **wall sleeve** 

**dimensions, consistent**  **with Addendum**  **t to**  **the American**  **Society of**  **Heating, Refrigerating,**  **and**

**Air­Conditioning Engineers,**  **Inc. (ASHRAE)**  **Standard 90.1­2007,**  **“** Energy Standard for

Buildings Except Low­Rise Residential Buildings” **(ASHRAE Standard**  **90.1­2007). Standard** 

**size PTACs**  **and PTHPs**  **refer to**  **equipment with**  **wall sleeve**  **dimensions having**  **an external**  **wall**

**opening of**  **greater than**  **or equal**  **to 16**  **inches high**  **or greater**  **than or**  **equal to**  **42 inches**  **wide, and** 

**having a**  **cross­sectional area**  **greater than**  **or equal**  **to 670**  **inches squared.**  **Non­standard size** 

**PTACs and**  **PTHPs, as**  **defined in**  **the MTA,**  **refer to**  **equipment with**  **wall sleeve**  **dimensions**

**having an**  **external wall**  **opening of**  **less than**  **16 inches**  **high or**  **less than**  **42 inches**  **wide, and** 

**having a**  **cross­sectional area**  **less than**  **670 square**  **inches. The**  **twelve equipment**  **classes covered** 

**by this**  **rulemaking for**  **PTACs and**  **PTHPs are**  **listed in**  **Table 5.2.1**  **and Table**  **5.2.2, respectively,** 

**and correspond**  **to those**  **contained in**  **Addendum t**  **of ASHRAE**  **Standard 90.1­2007.** 

**5­2**Table 5.2.1 Equipment Classes for PTACs

Equipment Class

Equipment Category Cooling Capacity

**PTAC Standard**  **Size** ***** **<7,000 Btu/h** 

**≥7,000 Btu/h**  **and**

**≤15,000 Btu/h** 

**>15,000 Btu/h** 

**Non­Standard Size**  ****** **<7,000 Btu/h** 

**≥7,000 Btu/h**  **and**

**≤15,000 Btu/h** 

**>15,000 Btu/h** 

***** **Standard size**  **refers to**  **PTAC equipment**  **with wall**  **sleeve dimensions**  **having an**  **external wall**  **opening of**  **greater**

**than or**  **equal to**  **16 inches**  **high or**  **greater than**  **or equal**  **to 42**  **inches wide,**  **and having**  **a cross­sectional**  **area greater** 

**than or**  **equal to**  **670 inches**  **squared.**

****** **Non­standard size**  **refers to**  **PTAC equipment**  **with existing**  **wall sleeve**  **dimensions having**  **an external**  **wall**

**opening of**  **less than**  **16 inches**  **high or**  **less than**  **42 inches**  **wide, and**  **having a**  **cross­sectional area**  **less than**  **670**

**inches squared.** 

Table 5.2.2 Equipment Classes for PTHPs

Equipment Class

Equipment Category Cooling Capacity

**PTHP Standard**  **Size** ***** **<7,000 Btu/h** 

**≥7,000 Btu/h**  **and**

**≤15,000 Btu/h** 

**>15,000 Btu/h** 

**Non­Standard Size**  ****** **<7,000 Btu/h** 

**≥7,000 Btu/h**  **and**

**≤15,000 Btu/h** 

**>15,000 Btu/h** 

***** **Standard size**  **refers to**  **PTHP equipment**  **with wall**  **sleeve dimensions**  **having an**  **external wall**  **opening of**  **greater**

**than or**  **equal to**  **16 inches**  **high or**  **greater than**  **or equal**  **to 42**  **inches wide,**  **and having**  **a cross­sectional**  **area greater** 

**than or**  **equal to**  **670 inches**  **squared.**

****** **Non­standard size**  **refers to**  **PTHP equipment**  **with existing**  **wall sleeve**  **dimensions having**  **an external**  **wall**

**opening of**  **less than**  **16 inches**  **high or**  **less than**  **42 inches**  **wide, and**  **having a**  **cross­sectional area**  **less than**  **670**

**inches squared.** 

**The current**  **Federal energy**  **conservation standards**  **and the**  **efficiency levels**  **specified**

**by ASHRAE**  **Standard 90.1­1999**  **for PTACs**  **and PTHPs**  **are a**  **function of**  **the equipment’s** 

**cooling capacity.**  **Both standards**  **have equations**  **to calculate**  **the efficiency**  **levels for**  **PTACs and** 

**PTHPs between**  **the 7,000**  **Btu/h and**  **15,000 Btu/h**  **cooling capacity**  **range for**  **each equipment** 

**class. For**  **equipment with**  **cooling capacities**  **below 7,000**  **Btu/h and**  **above 15,000**  **Btu/h, current** 

**Federal energy**  **conservation standards**  **and ASHRAE**  **Standard 90.1­1999**  **maintain a**  **constant**

**efficiency level**  **equal to**  **the value**  **of the**  **efficiency equation**  **at either**  **7,000 Btu/h**  **or 15,000** 

**Btu/h cooling**  **capacity (e.g.,**  **the efficiency**  **level for**  **6,000 Btu/h**  **cooling capacity**  **equipment**

**equals the**  **efficiency level**  **for 7,000**  **Btu/h cooling**  **capacity equipment,**  **and the**  **efficiency level** 

**5­3 for**  **16,000 Btu/h**  **cooling capacity**  **equipment equals**  **the efficiency**  **level for**  **15,000 Btu/h**  **cooling**

**capacity equipment).** 

**In addition,**  **the Air­Conditioning,**  **Heating, and**  **Refrigeration Institute**  **c (AHRI)**  **provided**

**DOE with**  **annual PTAC**  **and PTHP**  **industry shipment**  **data that**  **included equipment**  **shipment**

**quantities by**  **cooling capacity**  **and equipment**  **type. According**  **to the**  **data provided**  **by AHRI** 

**from December**  **2006, over**  **73 percent**  **of PTACs**  **and PTHPs**  **fall within**  **the 7,000**  **Btu/h to** 

**15,000 Btu/h**  **cooling capacity**  **range. 1**  **Therefore, based**  **on the**  **current Federal**  **energy**

**conservation standards,**  **the standards**  **specified by**  **ASHRAE Standard**  **90.1­1999, and**  **shipment**

**data provided**  **by AHRI,**  **DOE directly**  **examined equipment**  **with cooling**  **capacities between** 

**7,000 Btu/h**  **and 15,000**  **Btu/h for**  **standard and**  **non­standard size**  **PTACs and**  **PTHPs.**

**For the**  **engineering analysis,**  **DOE reviewed**  **all twelve**  **equipment classes**  **covered by**  **this**

**rulemaking. Since**  **the wall**  **sleeve dimensions**  **effect the**  **energy efficiency**  **of the**  **equipment,**

**DOE examined**  **standard size**  **and non­standard**  **size PTACs**  **and PTHPs**  **separately. In**  **addition,**

**since the**  **energy­efficiency equations**  **for PTACs**  **and PTHPs**  **established by**  **EPCA and** 

**ASHRA/IESNA Standard**  **90.1­1999 are**  **a function**  **of the**  **equipment’s cooling**  **capacity, DOE** 

**examined specific**  **cooling capacities**  **for standard**  **size and**  **non­standard size**  **PTACs and**  **PTHPs,**

**which are**  **referred to**  **as representative**  **cooling capacities.**  **DOE reviewed**  **the shipments**  **data**

**provided by**  **AHRI for**  **the 2000**  **Screening Analysis**  **and today’s**  **rulemaking, and**  **found the** 

**majority of**  **shipments have**  **a cooling**  **capacity within**  **the 7,000**  **Btu/h to**  **15,000 Btu/h**  **range.**

5.2.1 Representative Cooling Capacities and Wall Sleeve Dimensions

**Because of**  **the large**  **variations in**  **equipment cooling**  **capacity and**  **performance within** 

**each equipment**  **class of**  **standard and**  **non­standard size**  **PTACs and**  **PTHPs, DOE**  **analyzed some** 

**of the**  **cooling capacities**  **individually. DOE**  **used representative**  **cooling capacities**  **and wall** 

**sleeve dimensions**  **and extrapolated**  **the results**  **to other**  **cooling capacities**  **within the**  **PTAC and** 

**PTHP market.**  **The representative**  **cooling capacities**  **and wall**  **sleeve dimensions,**  **which**

**correspond to**  **the equipment**  **with the**  **highest number**  **of shipments,**  **allowed DOE**  **to analyze**  **in**

**detail specific**  **equipment that**  **can provide**  **information representative**  **of the**  **entire equipment** 

**class. The**  **representative cooling**  **capacities and**  **wall sleeve**  **dimensions also**  **allowed DOE**  **to**

**c The**  **Air­Conditioning, Heating,**  **and Refrigeration**  **Institute (AHRI)**  **is the**  **trade association**  **representing PTAC**  **and**

**PTHP manufacturers.**  **The Air**  **Conditioning and**  **Refrigeration Institute**  **(ARI) and**  **the Gas**  **Appliance Manufacturers** 

**Association (GAMA)**  **announced on**  **December 17,**  **2007 that**  **their members**  **voted to**  **approve the**  **merger of**  **the two** 

**trade associations**  **to represent**  **the interests**  **of cooling,**  **heating, and**  **commercial refrigeration**  **equipment**

**manufacturers. The**  **merged association**  **became AHRI**  **on Jan.**  **1, 2008.** 

**5­4 establish**  **baseline units**  **that are**  **used throughout**  **the rulemaking**  **analyses. The**  **baseline units**  **are**

**further discussed**  **in section**  **5.9.1 of**  **this analysis.** 

5.2.1.1 Standard Size PTAC and PTHP Representative Equipment

**For standard**  **size PTAC**  **and PTHP**  **equipment classes,**  **DOE has**  **identified two** 

**representative cooling**  **capacities and**  **one representative**  **wall sleeve**  **dimension. The** 

**representative cooling**  **capacities for**  **standard size**  **PTACs and**  **PTHPs are**  **9,000 Btu/h**  **and**

**12,000 Btu/h.**  **Both representative**  **cooling capacities**  **fall within**  **the ≥7,000**  **and ≤15,000**  **Btu/h**

**cooling capacity**  **range. The**  **representative standard**  **size wall**  **sleeve dimension**  **is 16**  **inches high** 

**by 42**  **inches wide.**  **The two**  **representative cooling**  **capacities and**  **wall sleeve**  **dimensions**

**correspond to**  **the cooling**  **capacities and**  **wall sleeve**  **dimensions with**  **the highest**  **number of** 

**shipments. These**  **were found**  **using data**  **gathered from**  **the 2008**  **AHRI** Directory of Certified

Performance **2 (2008**  **AHRI directory),**  **the American**  **Council for**  **an Energy**  **Efficient Economy** 

**(ACEEE) database**  **of equipment,**  **3 as**  **well as**  **the shipment**  **information provided**  **to DOE**  **in the** 

2000 Screening Analysis for EPACT­Covered Commercial Heating, Ventilating, and AirConditioning (HVAC) and Water­Heating Equipment **report (commonly**  **referred to**  **as the**  **2000**

**Screening Analysis).**  **4 Figure**  **5.2.1 and**  **Figure 5.2.2**  **show number**  **of shipments**  **by equipment** 

**class and**  **cooling capacity**  **for standard**  **size PTACs**  **and PTHPs,**  **respectively.**NumberofShipments 100,000

90,000

80,000

70,000

60,000

50,000

40,000

30,000

20,000

10,000

­

7.0 & Under 7.1 ­ 10.0 10.1 ­ 13.0 13.1 ­ 16.0 Over 16.0

Cooling Capacity Ranges (1000 Btu/h)

1997 1998 1999 2000 2001 2002 2003 2004 2005 2006

Figure 5.2.1 Annual Number of Shipments for Standard Size PTACs by Cooling Capacity

– AHRI, December 2006 1

**5­5**­ 10,000 20,000 30,000 40,000 50,000 60,000 70,000 80,000 90,000 100,000NumberofShipments

7.0 & Under 7.1 ­ 10.0 10.1 ­ 13.0 13.1 ­ 16.0 Over 16.0

Cooling Capacity Ranges (1000 Btu/h)

1997 1998 1999 2000 2001 2002 2003 2004 2005 2006

Figure 5.2.2 Annual Number of Shipments for Standard Size PTHPs by Cooling Capacity

– ARHI, December 2006 1

**The shipment**  **data provided**  **by AHRI**  **shows that**  **the chosen**  **representative cooling**  **capacities**

**fall within**  **the cooling**  **capacity ranges**  **with the**  **highest shipments.** 

**The engineering**  **analysis results**  **for the**  **two representative**  **cooling capacities**  **are used**  **in**

**the remaining**  **DOE analyses,**  **including the**  **life­cycle cost**  **analysis and**  **the national**  **impact**

**analysis. DOE**  **used the**  **analytical results**  **for the**  **two representative**  **cooling capacities**  **to**

**examine the**  **slope of**  **the energy­efficiency**  **equation (i.e.,**  **EER as**  **a function**  **of cooling**  **capacity).**

**More details**  **explaining how**  **DOE extrapolates**  **the proposed**  **amended energy**  **conservation**

**standards for**  **the representative**  **cooling capacities**  **to the**  **entire range**  **of cooling**  **capacities is** 

**found in**  **Chapter 9**  **of this**  **TSD.**

5.2.1.2 Non­Standard Size PTAC and PTHP Representative Equipment

**For non­standard**  **size PTAC**  **and PTHP**  **equipment classes,**  **DOE has**  **identified one** 

**representative cooling**  **capacity that**  **corresponds to**  **the middle**  **of the**  **cooling capacity**  **range and** 

**is not**  **representative of**  **any particular**  **unit or**  **manufacturer. DOE**  **recognizes that**  **non­standard**

**size equipment**  **has size**  **constraints and**  **the refrigeration**  **cycle components**  **have to**  **be sized**  **to fit** 

**inside the**  **wall sleeve.**  **This constrains**  **the size**  **of the**  **compressor and**  **heat exchangers**  **and,**

**therefore, the**  **cooling capacity**  **and possible**  **efficiencies. The**  **non­standard size**  **PTAC and** 

**5­6 PTHP**  **market also**  **has a**  **greater variety**  **of shipments**  **based on**  **the customers**  **and specialized** 

**applications. Non­standard**  **equipment are**  **typically installed**  **in buildings**  **where wall**  **sleeves**

**were constructed**  **prior to**  **the development**  **of the**  **standard dimensions.**  **As a**  **result, non­standard** 

**size equipment**  **are manufactured**  **in a**  **wide range**  **of configurations**  **for installations**  **within a** 

**variety of**  **wall sleeve**  **dimensions found**  **among these**  **buildings. Therefore,**  **it is**  **difficult to** 

**determine a**  **representative wall**  **sleeve dimensions**  **with the**  **highest shipments.**  **For the** 

**engineering analysis**  **and subsequent**  **analyses, DOE**  **analyzed non­standard**  **size PTACs**  **and**

**PTHPs with**  **11,000 Btu/h**  **cooling capacity.** 

**Similarly, the**  **energy efficiency**  **equations for**  **non­standard size**  **PTACs and**  **PTHPs are**  **a**

**function of**  **cooling capacity.**  **DOE used**  **the analytical**  **results for**  **the representative**  **capacity of** 

**non­standard PTACs**  **and PTHPs**  **and the**  **existing slope**  **of the**  **ASHRAE Standard**  **90.1­1999**

**energy­efficiency equation**  **to extrapolate**  **the results**  **to the**  **entire span**  **of cooling**  **capacities.**

**More details**  **explaining how**  **DOE extrapolates**  **amended energy**  **conservation standard**  **for the** 

**representative cooling**  **capacity of**  **non­standard PTAC**  **and PTHP**  **equipment to**  **the entire**  **range**

**of cooling**  **capacities is**  **found in**  **Chapter 9**  **of this**  **TSD.**

5.3 METHODOLOGY OVERVIEW

**This section**  **describes the**  **analytical methodology**  **used in**  **the engineering**  **analysis.**

**Figure 5.3.1**  **shows a**  **flow diagram**  **of this**  **methodology and**  **the corresponding**  **sections in**  **this**

**chapter. The**  **results of**  **the engineering**  **analysis are**  **several cost­efficiency**  **curves, a**  **material**

**price­sensitivity analysis,**  **and an**  **alternative refrigerant**  **analysis.**

**5­7 Cost**  **Model**

**(section 5.6)**  **Manufacturer**

**Markup**

**Analysis**

**(section 5.8**  **)**

**Cost­Efficiency**

**Curves**

**(EER vs**  **MPC)**

**(section 5.9**  **) Material**  **Price**

**Sensitivity**

**Analysis**

**(section 5.11)** 

**Engineering**

**Manufacturer**

**Interviews**

**(section 5.6.8)**  **Alternative**

**Refrigerant**

**Analysis**

**(section 5.10)**  **Physical**

**Teardown**

**Analysis**

**(section 5.4)**  **Virtual**

**Teardown**

**Analysis**

**(section 5.4)** 

**BOMs**

**(section 5.4.2)**  **Cost­Efficiency**

**Relationship**

**(EER vs**  **MSP)**

**(section 5.13**  **) Design** 

**Options**

**(section 5.5)** 

**Screening**

**Analysis**

**(Chapter 4)** 

Figure 5.3.1 Flow Diagram of Engineering Analysis Methodology

**At the**  **start of**  **the process,**  **DOE created**  **BOMs for**  **a sample**  **of existing**  **PTAC and**  **PTHP**

**equipment using**  **reverse engineering**  **methods (see**  **section 5.4).**  **From the**  **screening analysis,** 

**DOE identified**  **design options**  **manufacturers use**  **to increase**  **the EER**  **and COP**  **of the** 

**equipment. DOE**  **calculated the**  **incremental MPC**  **for each**  **design option**  **in each**  **equipment**

**class by**  **using the**  **BOMs and**  **the design**  **options in**  **the manufacturing**  **cost model**  **(see section** 

**5.6). DOE**  **calculated the**  **cost­effectiveness of**  **each design**  **option by**  **dividing the**  **incremental**

**cost by**  **the associated**  **increase in**  **EER. The**  **results were**  **ranked by**  **cost­effectiveness and**  **added**

**to the**  **baseline model**  **MPC to**  **produce cost­efficiency**  **points above**  **the baseline.**  **DOE then** 

**graphed each**  **point and**  **fit a**  **cost­efficiency curve**  **to the**  **data (see**  **section 5.8).**  **During the** 

**preparation of**  **the cost­efficiency**  **curves, DOE**  **held interviews**  **with manufacturers’**  **engineering**

**staff to**  **gain insight**  **into the**  **PTAC and**  **PTHP industry**  **and request**  **comments on**  **the engineering** 

**approach DOE**  **used in**  **the analysis**  **(see section**  **5.6.8). DOE**  **used the**  **information gathered**  **from**

**these interviews**  **in the**  **design options**  **and the**  **cost model,**  **and then**  **recalculated the**  **cost**

**efficiency curves.**  **Using publicly**  **available PTAC**  **and PTHP**  **industry financial**  **data, DOE** 

**converted the**  **MPCs from**  **the cost­efficiency**  **curves into**  **MSPs (see**  **section 5.8).**  **Using market** 

**information and**  **data gathered**  **from the**  **interviews, DOE**  **analyzed the**  **effects of**  **material price**  **on**

**the cost­efficiency**  **curves in**  **a sensitivity**  **analysis (see**  **section 5.11).**  **DOE also**  **analyzed the** 

**effects of**  **using an**  **alternative refrigerant**  **on system**  **performance and**  **the cost­efficiency** 

**relationship (see**  **section 5.10).** 

**5­8**5.4 TEARDOWN ANALYSIS

**To calculate**  **the manufacturing**  **costs of**  **the different**  **components in**  **PTACs and**  **PTHPs,**

**DOE disassembled**  **multiple units**  **into their**  **components and**  **estimated the**  **material and**  **labor**

**cost of**  **each one.**  **This process**  **is referred**  **to as**  **a “physical**  **teardown.” A**  **supplementary method,** 

**called a**  **“virtual teardown,”**  **uses published**  **manufacturer catalogs**  **and supplementary**  **component**

**data to**  **estimate the**  **major physical**  **differences between**  **a piece**  **of equipment**  **that was**  **physically**

**disassembled and**  **a similar**  **piece of**  **equipment that**  **was not.**  **The teardown**  **analysis for**  **this**

**engineering analysis**  **included several**  **physical and**  **virtual teardowns**  **of standard**  **and non** 

**standard size**  **PTACs and**  **PTHPs.**

5.4.1 Selection of Units

**DOE selected**  **several standard**  **and non­standard**  **size PTAC**  **and PTHP**  **units to**  **represent**

**the market,**  **and used**  **these for**  **teardown in**  **the engineering**  **analysis. The**  **selected equipment** 

**exhibited the**  **following four**  **characteristics:**

**1. The**  **selected equipment,**  **taken together,**  **evenly cover**  **the full**  **range of**  **efficiency**

**levels considered**  **in the**  **analysis.**

**2. When**  **possible, DOE**  **selected one**  **lower­efficiency unit**  **and one**  **higher­efficiency**

**unit from**  **the same**  **manufacturer. When**  **possible, those**  **units shared**  **similar**

**characteristics (e.g.,**  **both from**  **the same**  **product line).** 

**3. The**  **equipment tended**  **to be**  **from manufacturers**  **with relatively**  **large shares**  **of the** 

**PTAC and**  **PTHP markets,**  **and thus**  **was representative**  **of typical**  **design approaches.** 

**4. The**  **selected equipment**  **included base**  **units with**  **few, if**  **any, equipment**  **features or** 

**options that**  **add cost**  **without affecting**  **equipment efficiency.** 

**DOE did**  **not explicitly**  **identify the**  **efficiency levels**  **of the**  **units it**  **tore down**  **because this** 

**could expose**  **sensitive information**  **about individual**  **manufacturers’ equipment.** 

**Using the**  **data gathered**  **from the**  **physical teardowns,**  **DOE characterized**  **each component** 

**according to**  **its weight,**  **dimensions, material,**  **quantity, and**  **the manufacturing**  **processes used**  **to**

**fabricate and**  **assemble it.**  **For supplementary**  **virtual teardowns,**  **DOE gathered**  **equipment data** 

**from publicly**  **available manufacturer**  **catalogs, such**  **as coil**  **dimensions, weight,**  **compressor type,** 

**and fan**  **motor configuration.**  **DOE obtained**  **information that**  **was unavailable**  **from the**  **catalog**

**data, such**  **as fan**  **motor details,**  **compressor specifications,**  **or assembly**  **details, from**  **the physical** 

**teardowns of**  **a similar**  **equipment or**  **by estimations**  **based on**  **industry knowledge.**  **DOE**

**collected additional**  **component information**  **during the**  **engineering manufacturer**  **interviews.**

**5­9**5.4.2 Generation of Bills of Materials

**DOE developed**  **structured BOMs**  **for each**  **of the**  **physical and**  **virtual teardowns.** 

**Structured BOMs**  **describe each**  **equipment part**  **and its**  **relationship to**  **the other**  **parts in**  **the**

**estimated order**  **in which**  **manufacturers assembled**  **them. The**  **BOMs describe**  **each fabrication** 

**and assembly**  **operation in**  **detail, including**  **the type**  **of equipment**  **needed (e.g.,**  **presses, drills),** 

**the process**  **cycle times,**  **and the**  **labor associated**  **with each**  **manufacturing step.**  **The result**  **is a** 

**thorough and**  **explicit model**  **of the**  **production process,**  **which includes**  **space, conveyor,**  **and**

**equipment requirements**  **by planned**  **production level.** 

**The BOMs**  **incorporate all**  **materials, components,**  **and fasteners**  **classified as**  **either raw** 

**materials or**  **purchased parts**  **and assemblies.**  **The classifications**  **into raw**  **materials or**  **purchased**

**parts were**  **based on**  **DOE’s previous**  **industry experience,**  **recent information**  **in trade** 

**publications, and**  **discussions with**  **high­ and low­volume**  **original equipment**  **manufacturers**

**(OEMs). DOE**  **also visited**  **manufacturing plants**  **to reinforce**  **its understanding**  **of the**  **industry’s**

**current manufacturing**  **practices.**

**For purchased**  **parts, the**  **purchase price**  **is estimated**  **based on**  **volume­variable price** 

**quotations and**  **detailed discussions**  **with suppliers.**  **For fabricated**  **parts, the**  **prices of**  **“raw”**

**materials (e.g.,**  **tube, sheet**  **metal) are**  **estimated on**  **the basis**  **of 5­year**  **averages (see**  **section**

**5.6.7). The**  **cost of**  **transforming the**  **intermediate materials**  **into finished**  **parts is**  **estimated based** 

**on current**  **industry pricing.**  **DOE shared**  **major assumptions**  **and estimates**  **with manufacturers** 

**during the**  **engineering manufacturer**  **interviews to**  **gain feedback**  **on the**  **analysis, its** 

**methodology, and**  **preliminary results.** 

**Multiple BOMs**  **based on**  **several PTAC**  **and PTHP**  **units, became**  **the basis**  **for the**  **cost**

**model (see**  **section 5.6).**  **The other**  **major inputs**  **into the**  **cost model**  **are the**  **design options,**  **which**

**DOE identified**  **in the**  **screening analysis**  **(Chapter 4).**  **The following**  **section defines**  **the different** 

**design options**  **and describes**  **their purpose**  **in determining**  **the cost­efficiency**  **relationship for** 

**PTACs and**  **PTHPs.**

5.5 DESIGN OPTIONS

**Design options**  **are technologies**  **and design**  **changes manufacturers**  **use to**  **improve**

**equipment performance.**  **These options**  **provide different**  **ways to**  **increase equipment**  **efficiency**

**from the**  **minimum (“baseline”)**  **to the**  **market maximum**  **(“max­tech”).**

**For the**  **engineering analysis,**  **DOE calculated**  **each efficiency**  **level between**  **the baseline** 

**and max­tech**  **using the**  **design options.**  **Using the**  **teardown analysis**  **and discussions**  **with**

**manufacturers, DOE**  **calculated the**  **increase in**  **EER from**  **each design**  **option. DOE**  **fed the** 

**design options**  **and BOMs**  **into the**  **cost model**  **to calculate**  **all the**  **MPCs, including**  **the costs**  **for**

**the baseline**  **unit and**  **each incremental**  **design option.**  **DOE averaged**  **the design**  **option costs**  **to**

**normalize the**  **data and**  **prevent exposing**  **sensitive information**  **about individual**  **manufacturers’**

**5­10 equipment.**  **Once the**  **MPC of**  **each design**  **option was**  **determined, DOE**  **could develop**  **a design** 

**option approach**  **to calculate**  **the cost­efficiency**  **curves (see**  **section 5.9.1).** 

5.5.1 Screened­In Technologies

**Table 5.5.1**  **lists the**  **technologies that**  **DOE did**  **not screen**  **out in**  **the screening**  **analysis**

**(see Chapter**  **4).**

Table 5.5.1 Technologies Not Screened Out

**Higher Efficiency**  **Compressors**

**Increased Heat**  **Exchanger Area** 

• **Add one**  **coil row**  **(thus increasing**  **the number**  **of tubes**  **and the**  **overall heat** 

**exchanger depth)** 

• **Increase heat**  **exchanger frontal**  **area by**  **20 percent** 

**Re­Circuiting Heat**  **Exchanger Coils** 

**The screened­in**  **technologies became**  **the design**  **options. DOE**  **further refined**  **the design** 

**options using**  **knowledge from**  **the teardown**  **analysis, market**  **research, and**  **discussions with** 

**manufacturers.**

**The design**  **options and**  **the technology**  **levels for**  **each design**  **option are**  **described below.** 

5.5.1.1 Higher Efficiency Compressors

**The compressor’s**  **efficiency has**  **a significant**  **impact on**  **PTAC and**  **PTHP EER.**  **DOE**

**determined from**  **the teardown**  **analysis that**  **manufacturers opt**  **for either**  **a low­ or**  **high**

**efficiency rotary**  **compressor, depending**  **on the**  **product line**  **(i.e., premium**  **equipment carries**  **the**

**high­efficiency compressor,**  **while baseline**  **equipment carries**  **the low­efficiency**  **compressors).**

**From the**  **teardown analysis,**  **DOE estimated**  **that the**  **increase in**  **EER for**  **PTACs and**  **PTHPs**

**from a**  **low­ to high­efficiency**  **compressor was**  **approximately 0.8.** 

5.5.1.2 Increase Heat Exchanger Area

**Increasing the**  **heat exchanger**  **frontal area**  **in PTACs**  **and PTHPs**  **is a**  **challenge because**  **of**

**the wall**  **sleeve’s size**  **constraints. Manufacturers**  **use creative**  **approaches to**  **maximize the**  **heat**

**exchanger area**  **inside the**  **cabinet without**  **surpassing the**  **volume determined**  **by the**  **standard wall** 

**sleeve dimensions**  **or disrupting**  **the vital**  **airflows across**  **the heat**  **exchangers. Table**  **5.5.2**

**outlines these**  **design options.** 

**5­11**Table 5.5.2 Increase Heat Exchanger Area Design Options

Design Option EER Increase

**Add a**  **second tube**  **row to**  **the condenser**  **heat**

**exchanger. (Subsequent**  **coil row**  **additions have**  **a**

**lower EER**  **impact.) 0.9** 

**Increase overall**  **heat exchanger**  **frontal area**  **by 20** 

**percent. (Example:**  **use “L”**  **or “U”**  **shape.) 0.5** 

5.5.1.3 Re­Circuiting Heat Exchanger Coils

**PTAC and**  **PTHP manufacturers**  **can increase**  **EER by**  **adding coil**  **circuits to**  **both**

**evaporator and**  **condenser heat**  **exchangers. Re­circuiting**  **a heat**  **exchanger can**  **reduce the** 

**refrigerant pressure**  **drop by**  **running multiple**  **circuits in**  **parallel, improving**  **the heat**  **transfer, etc.** 

**The gains**  **are modest**  **since these**  **heat exchangers**  **are optimized**  **by design.**  **However, re** 

**circuiting does**  **allow a**  **manufacturer to**  **optimize one**  **heat exchanger**  **for use**  **in units**  **with varying** 

**capacities. A**  **variation on**  **re­circuiting is**  **using a**  **coolant loop**  **in the**  **drain pan,**  **transferring heat** 

**from the**  **refrigerant to**  **any accumulated**  **condensate. With**  **the help**  **of the**  **teardown analysis**  **and**

**discussion with**  **manufacturers, DOE**  **calculated that**  **re­circuiting the**  **heat exchanger**  **coils**

**increases the**  **EER by**  **about 0.1.** 

5.6 COST MODEL AND DEFINITIONS

**Once DOE**  **disassembled selected**  **units, gathered**  **information from**  **manufacturer catalogs** 

**on additional**  **equipment, and**  **identified design**  **options, DOE**  **created an**  **appropriate**

**manufacturing cost**  **model that**  **translates physical**  **information into**  **MPCs. The**  **cost model**  **is**

**based on**  **production activities**  **and divides**  **factory costs**  **into the**  **following categories:** 

• Materials **: Purchased**  **parts (i.e.**  **compressors, control**  **boards, etc.),**  **raw materials** 

**(i.e., fin**  **stock coils,**  **sheet metal,**  **etc.), and**  **indirect materials.** 

• Labor **: Fabrication,**  **assembly, and**  **indirect labor.**  **Fabrication and**  **assembly labor** 

**cost are**  **burdened with**  **benefits and**  **supervisory costs.** 

• Overhead **: Equipment,**  **tooling, and**  **building depreciation,**  **as well**  **as utilities,** 

**equipment and**  **tooling maintenance,**  **insurance, and**  **property taxes.** 

5.6.1 Cost Definitions

**Because there**  **are many**  **different accounting**  **systems and**  **methods to**  **monitor costs,**  **DOE**

**defined the**  **above terms**  **as follows:** 

• **Direct material:**  **Purchased parts**  **(out­sourced) plus**  **manufactured parts**  **(made in** 

**house from**  **raw materials).** 

**5­12**• **Indirect material:**  **Material used**  **during manufacturing**  **(e.g., welding**  **rods,**

**adhesives).**

• **Fabrication labor:**  **Labor associated**  **with in­house**  **piece manufacturing.** 

• **Assembly labor:**  **Labor associated**  **with final**  **assembly and**  **sub­assemblies.**

• **Indirect labor:**  **Labor costs**  **that scale**  **with fabrication**  **and assembly**  **labor. This** 

**includes the**  **cost of**  **technicians, manufacturing**  **engineering support,**  **stocking, etc.** 

**that are**  **assigned on**  **a span**  **basis.**

• **Overhead Labor:**  **Costs associated**  **with direct**  **labor and**  **span for**  **floor supervisors,** 

**plant managers,**  **etc. Research**  **and development,**  **corporate management,**  **general**

**administration, and**  **maintenance labor**  **costs are**  **not included.** 

• **Equipment and**  **plant depreciation:**  **Money allocated**  **to pay**  **for initial**  **equipment**

**installation and**  **replacement as**  **the production**  **equipment wears**  **out.**

• **Tooling depreciation:**  **Cost for**  **initial tooling**  **(including non­recurring**  **engineering**

**and debugging**  **of the**  **tools) and**  **tooling replacement**  **as it**  **wears out.** 

• **Building depreciation:**  **Money allocated**  **to pay**  **for the**  **building space**  **and the** 

**conveyors that**  **feed and/or**  **make up**  **the assembly**  **line.**

• **Utilities: Electricity,**  **gas, telephones,**  **etc.**

• **Maintenance: Annual**  **money spent**  **on maintaining**  **tooling and**  **equipment.**

• **Insurance: Appropriated**  **as a**  **function of**  **unit cost.** 

• **Property Tax:**  **Appropriated as**  **a function**  **as unit**  **cost.**

5.6.2 Cost Model Overview

**This section**  **provides a**  **basic overview**  **of how**  **the BOMs**  **for PTACs**  **and PTHPs**  **are**

**transformed into**  **cost information**  **via the**  **cost model.** 

**DOE generated**  **the equipment**  **BOMs via**  **multiple physical**  **and virtual**  **teardowns.**

**Within each**  **BOM, all**  **manufacturing and**  **assembly steps**  **are noted**  **and the**  **resultant equipment,** 

**worker, and**  **investment requirements**  **are calculated.**  **Subsequently, multiple**  **databases were** 

**created to**  **capture the**  **scope of**  **PTAC and**  **PTHP design**  **options, such**  **as heat**  **exchanger**

**dimensions, compressor**  **choices, and**  **other factors.** 

**To determine**  **the MPCs**  **for the**  **BOMs and**  **design options,**  **DOE could**  **follow two** 

**different paths,**  **depending on**  **whether a**  **subassembly was**  **purchased (out­sourced)**  **or produced** 

**5­13 in­house.**  **Section 5.6.3**  **describes the**  **estimations used**  **in the**  **cost model**  **and provides**  **a list**  **of all** 

**the purchased**  **subassemblies. For**  **purchased parts,**  **DOE gathered**  **price quotations**  **from major** 

**suppliers at**  **different production**  **volumes.**

**For parts**  **produced in­house,**  **DOE reconstructed**  **manufacturing processes**  **for each**  **part**

**using internal**  **expertise and**  **information gathered**  **from engineering**  **manufacturer interviews.** 

**Using these**  **resources, DOE**  **assigned labor**  **time, equipment**  **use, and**  **other important**  **factors to** 

**each subassembly**  **in each**  **of the**  **equipment considered**  **for this**  **analysis.**

**The last**  **step was**  **converting this**  **information into**  **dollar values.**  **To perform**  **this task,** 

**DOE collected**  **information on**  **labor rates,**  **tooling costs,**  **raw material**  **prices, and**  **other factors.** 

**DOE assumed**  **values for**  **these parameters**  **using internal**  **expertise and**  **confidential information** 

**available to**  **DOE contractors.**  **Although most**  **of the**  **assumptions are**  **manufacturer specific**  **and**

**cannot be**  **revealed, section**  **5.6.4 provides**  **a discussion**  **of the**  **values used**  **for each**  **assumption.**

**In summary,**  **DOE assigned**  **costs of**  **labor, materials,**  **and overhead**  **to each**  **part whether** 

**purchased or**  **produced in­house.**  **DOE then**  **aggregated single­part**  **costs into**  **major assemblies** 

**(e.g., compressor**  **assembly, condenser**  **heat exchange**  **assembly, evaporator**  **heat exchanger** 

**assembly, controls,**  **etc.) and**  **summarized these**  **costs in**  **a worksheet.**  **During engineering** 

**interviews, DOE**  **showed PTAC**  **and PTHP**  **manufacturers key**  **assumptions and**  **estimates from** 

**the cost**  **model and**  **asked for**  **feedback. DOE**  **considered any**  **information manufacturers**  **gave**

**that was**  **relevant to**  **the cost**  **model and**  **incorporated into**  **the analysis**  **if appropriate.** 

5.6.3 Cost Model Estimations Overview

**As discussed**  **in the**  **previous section,**  **DOE made**  **estimations about**  **manufacturer**

**practices and**  **cost structure**  **play an**  **important role**  **in estimating**  **the final**  **equipment cost.**  **Some**

**estimations were**  **different for**  **specific manufacturers,**  **depending on**  **their market**  **position,**

**manufacturing practices,**  **and size.**  **DOE aggregated**  **the final**  **cost values**  **to prevent**  **disclosure of** 

**confidential information.** 

**In converting**  **physical information**  **about the**  **equipment into**  **cost information,**  **DOE**

**reconstructed manufacturing**  **processes for**  **each component**  **using internal**  **expertise and** 

**knowledge of**  **the methods**  **used by**  **the industry.**  **DOE used**  **estimations regarding**  **the**

**manufacturing process**  **parameters (e.g.,**  **equipment use,**  **labor rates,**  **tooling depreciation,**  **and**

**cost of**  **purchased raw**  **materials) to**  **determine the**  **value of**  **each component.**  **DOE then**  **summed**

**the values**  **of the**  **components into**  **assembly costs**  **and, finally,**  **the total**  **equipment cost.**  **The**

**equipment cost**  **included the**  **material, labor,**  **and overhead**  **costs associated**  **with the** 

**manufacturing facility.**  **The material**  **costs included**  **both direct**  **and indirect**  **materials. The**  **labor**

**rates included**  **fabrication, assembly,**  **and indirect**  **and labor**  **rates, including**  **overhead.**

**The labor**  **costs were**  **determined by**  **the type**  **of equipment**  **(standard­ and non­standard** 

**size PTACs**  **and PTHPs)**  **manufactured at**  **the factory.**  **Overhead costs**  **included equipment** 

**depreciation, tooling**  **depreciation, building**  **depreciation, utilities,**  **equipment, tooling** 

**maintenance, insurance,**  **property, and**  **taxes.**

**5­14 DOE**  **presented an**  **initial draft**  **of the**  **cost­efficiency curves**  **to manufacturers**  **during the** 

**engineering interviews.**  **Using the**  **information gathered**  **from the**  **engineering interviews,**  **DOE**

**revised the**  **cost model**  **to address**  **manufacturer comments**  **and input.**  **These changes**  **involved**

**updating component**  **and material**  **pricing, labor**  **rates including**  **overhead, and**  **production**

**volumes.**

**The next**  **sections discuss**  **specific estimations**  **about outsourcing,**  **factory parameters,** 

**production volumes,**  **and material**  **prices. When**  **the estimations**  **are manufacturer­specific,**  **they**

**are presented**  **as industry**  **averages to**  **prevent disclosure**  **of confidential**  **information.**

5.6.4 Outsourcing Assumptions

**DOE characterized**  **parts based**  **on whether**  **manufacturers purchase**  **them from**  **outside**

**suppliers or**  **fabricate them**  **in­house. For**  **purchased parts,**  **DOE estimated**  **the purchase**  **price.**

**For fabricated**  **parts, DOE**  **estimated the**  **price of**  **intermediate materials**  **(e.g., tube,**  **sheet metal)** 

**and the**  **cost of**  **transforming them**  **into finished**  **parts. Whenever**  **possible, DOE**  **obtained price** 

**quotes directly**  **from suppliers**  **of the**  **manufacturers of**  **the units**  **being analyzed.** 

**DOE based**  **the manufacturing**  **operations assumptions**  **on internal**  **expertise, interviews** 

**with manufacturers,**  **and manufacturing**  **facility site**  **visits. According**  **to manufacturers,**  **standard**

**and non­standard**  **size equipment**  **basic manufacturing**  **operations are**  **the same.**  **All of**  **the**

**manufacturing operations**  **are conducted**  **in­house, as**  **summarized in**  **Table 5.6.1.** 

**5­15**Table 5.6.1 Cost Model In­House Manufacturing Operation Assumptions

Process In­House Sub­Process

**Tube Forming**  **Tube Cut** 

**Tube Bend** 

**Collar**

**Tube Coil** 

**Sheet Metal**  **Stamping**

**Press Brake** 

**Blanking**

**Turret Punch** 

**Welding Seam**  **Welding**

**Spot Welding** 

**Cutting Insulation**  **Cut**

**Finishing Paint** 

**Assembly Adhesive**  **Bonding**

**Brazing**

**Press Fit** 

**Fixture**

**Miscellaneous Assembly** 

**Operation**

**Final Assembly**  **Packaging**

**Quality Assurance** 

**Charging Refrigerant**  **Charging**

**Molding Injection**  **Mold**

**The difference**  **between standard**  **and non­standard**  **size PTAC**  **and PTHP**  **manufacturing**

**processes are**  **in the**  **purchased components.**  **DOE estimated**  **the majority**  **of manufacturers**  **of**

**standard size**  **PTACs and**  **PTHPs make**  **their heat**  **exchangers from**  **raw material**  **stock (i.e.,** 

**manufacture heat**  **exchangers at**  **their own**  **factories). DOE**  **estimated that**  **at least**  **half of** 

**manufacturers of**  **non­standard size**  **PTACs and**  **PTHPs purchase**  **their heat**  **exchangers from** 

**outside vendors.**  **Non­standard manufacturers**  **may choose**  **to purchase**  **their heat**  **exchangers**

**because they**  **could avoid**  **operating a**  **coil shop**  **with a**  **wide scope**  **of equipment**  **and at**  **a very**  **low**

**scale. Given**  **the very**  **high cost**  **of tooling**  **and equipment,**  **manufacturers of**  **non­standard size** 

**equipment lack**  **the scale**  **to justify**  **the capital**  **expenses involved.**  **Therefore, DOE**  **estimated heat** 

**exchanger prices**  **for non­standard**  **size PTACs**  **and PTHPs**  **based on**  **the assumption**  **that half**  **of**

**the manufacturers**  **purchase their**  **heat exchangers**  **and the**  **other half**  **manufacture the**  **heat**

**exchangers in**  **house.**

5.6.5 Factory Parameters Assumptions

**Manufacturers of**  **standard size**  **and or**  **non­standard size**  **equipment will**  **have different** 

**factory parameters.**  **Therefore, DOE**  **used information**  **gathered from**  **the manufacturer** 

**interviews and**  **analysis of**  **common industry**  **practices to**  **formulate factory**  **parameters for**  **both**

**kinds of**  **manufacturers. DOE**  **made assumptions**  **about a**  **set of**  **preliminary factory**  **parameters**

**before the**  **manufacturer interviews.**  **DOE revised**  **the assumptions**  **using comments**  **and**

**information gathered**  **during the**  **interviews. Table**  **5.6.2 and**  **Table 5.6.3**  **list DOE’s**  **assumptions**

**for manufacturers**  **of both**  **standard and**  **non­standard size**  **equipment.**

**5­16**Table 5.6.2 Standard Size PTAC and PTHP Factory Parameter Assumptions

**Annual Production**  **Volume (units/year)**  **100,000**

**Fabrication and**  **Assembly Labor**  **Wages ($/hr)**  **7**

**Burdened Fabrication**  **and Assembly**  **Labor Wage**  **($/hr) 9.10** 

**Supervisor Wage**  **Premium (over**  **fabrication and**  **assembly wage)**  **30%**

Table 5.6.3 Non­Standard Size PTAC and PTHP Factory Parameter Assumptions

**Annual Production**  **Volume (units/year)**  **20,000**

**Fabrication and**  **Assembly Labor**  **Wages ($/hr)**  **14.64**

**Burdened Fabrication**  **and Assembly**  **Labor Wage**  **($/hr) 19.03** 

**Supervisor Wage**  **Premium (over**  **fabrication and**  **assembly wage)**  **30%**

**The main**  **differences between**  **the assumptions**  **for standard**  **and non­standard**  **size PTACs** 

**and PTHPs**  **are the**  **labor rates**  **and production**  **volumes. Labor**  **rates for**  **manufacturers of** 

**standard size**  **PTACs and**  **PTHPs are**  **based on**  **the weighted**  **averages of**  **foreign and**  **domestic**

**manufacturers. Certain**  **large manufacturers**  **of PTACs**  **and PTHPs**  **make their**  **equipment in** 

**foreign factories,**  **where labor**  **rates are**  **significantly less**  **than domestic**  **rates. Foreign**  **labor rates** 

**are based**  **on engineering**  **manufacturer interviews,**  **internal expertise,**  **and industry**  **literature**

**research. DOE**  **assumed that**  **all manufacturers**  **of non­standard**  **size PTACs**  **and PTHPs**  **are**

**domestic. Domestic**  **labor rates**  **are based**  **on published**  **labor rates**  **for the**  **HVAC manufacturing** 

**industry from**  **the U.S.**  **Bureau of**  **Labor. 5** 

5.6.6 Production Volumes Assumptions

**A manufacturer’s**  **production volumes**  **vary depending**  **on several**  **factors, including** 

**market share,**  **the type**  **of equipment**  **produced (i.e.,**  **standard versus**  **non­standard), and**  **if the** 

**manufacturer produces**  **other similar**  **equipment (e.g.,**  **unitary air**  **conditioners or**  **heat pumps,** 

**commercial air**  **conditioners, etc.).**  **DOE based**  **production volume**  **assumptions for**  **standard and** 

**non­standard size**  **PTACs and**  **PTHPs on**  **industry knowledge**  **and engineering**  **manufacturer**

**interviews.**

**According to**  **manufacturers of**  **standard size**  **equipment, large**  **chain hotels**  **and motels**  **use**

**the industry**  **standard wall**  **sleeve dimensions**  **in their**  **construction. Orders**  **of equipment**  **can**

**reach several**  **hundred units**  **depending on**  **the construction.**  **As reported**  **in the**  **MTA, five** 

**competitors hold**  **the majority**  **of the**  **standard size**  **equipment market**  **share. Large**  **production**

**volumes would**  **be necessary**  **for these**  **five companies**  **to service**  **a large**  **demand by**  **large hotel** 

**and motel**  **chains. Based**  **on the**  **information provided**  **by manufacturers**  **and shipment** 

**information provided**  **by AHRI,**  **DOE estimated**  **that a**  **manufacturer of**  **standard size**  **equipment**

**produces an**  **average of**  **100,000 units**  **per year.** 

**Manufacturers of**  **non­standard size**  **equipment have**  **significantly smaller**  **production**

**volumes than**  **manufacturers of**  **standard size**  **equipment. The**  **main reason**  **for the**  **low production** 

**volume is**  **that the**  **majority of**  **new building**  **construction uses**  **the industry**  **standard wall**  **sleeve**

**dimension, leaving**  **a small**  **percentage of**  **in the**  **market for**  **non­standard sizes.**  **In addition,**  **non**

**standard size**  **equipment comes**  **in a**  **variety of**  **wall sleeve**  **dimensions that**  **require custom**  **orders**

**5­17 for**  **each application.**  **Because of**  **the customized**  **orders, manufacturers**  **of non­standard**  **size**

**equipment do**  **not hold**  **a large**  **inventory of**  **equipment; therefore,**  **annual outputs**  **are significantly** 

**less than**  **for manufacturers**  **of standard**  **size equipment.**  **In consideration**  **of these**  **factors, DOE** 

**estimated that**  **a manufacturer**  **of non­standard**  **size equipment**  **produces an**  **average of**  **20,000**

**units per**  **year.**

5.6.7 Material Prices Assumptions

**DOE determined**  **the cost**  **of raw**  **materials using**  **publicly available**  **information such**  **as**

**the American**  **Metals Market,**  **6 interviews**  **with manufacturers,**  **and direct**  **discussions with** 

**material suppliers.**  **Common metals**  **used in**  **the fabrication**  **of PTACs**  **and PTHPs**  **include plain** 

**cold rolled**  **steel (CRS),**  **copper tubing,**  **and aluminum.**  **There have**  **been drastic**  **fluctuations in** 

**metal prices**  **over the**  **last few**  **years. To**  **account for**  **these fluctuations,**  **DOE used**  **a 5­year** 

**average of**  **metal prices**  **from the**  **Bureau of**  **Labor Statistics**  **Producer Price**  **Indices (PPIs)** 

**spanning 2004**  **to 2008**  **with an**  **adjustment to**  **2007$. 7**  **DOE used**  **the PPIs**  **for copper**  **rolling,**

**drawing, and**  **extruding and**  **steel mill**  **products, and**  **made the**  **adjustments to**  **2007$ using**  **the**

**gross domestic**  **product implicit**  **price deflator.**  **8 Table**  **5.6.4 shows**  **the 5­year**  **average metal** 

**prices DOE**  **used for**  **the analysis.** 

Table 5.6.4 Five­Year Metal Prices

Metals Cost ($/lb)

(2007$)

**Plain Cold**  **Rolled Steel**  **$0.36**

**Painted CRS**  **$0.57**

**Galvanized CRS**  **$0.48**

**Fin Aluminum**  **$1.35**

**Plain Copper**  **$2.18**

**Copper Tube** 

**– Plain**  **$2.81**

**Copper Tube** 

**– Rifled**  **$3.01**

**Between 2004**  **and 2006,**  **the price**  **of steel**  **rose approximately**  **over 60**  **percent and**  **the**

**price of**  **copper rose**  **approximately over**  **140 percent.**  **Because DOE**  **used a**  **5­year average**  **in**

**material prices**  **from 2004­2008,**  **these drastic**  **increases are**  **normalized to**  **some extent**  **to better** 

**represent long­term**  **material price**  **averages. Because**  **it is**  **not clear**  **if these**  **material price**  **trends**

**will continue,**  **DOE conducted**  **a sensitivity**  **analysis to**  **illustrate the**  **effect of**  **raw material**  **price**

**increases on**  **the cost**  **of PTACs**  **and PTHPs**  **(see section**  **5.11). DOE**  **used the**  **results of**  **this**

**sensitivity analysis**  **in the**  **subsequent life­cycle**  **cost analysis**  **(Chapter 8)**  **to determine**  **the overall** 

**economic impacts**  **of various**  **efficiency levels**  **on PTACs**  **and PTHPs.** 

**For resins**  **used in**  **the fabrication**  **of PTACs**  **and PTHPs,**  **DOE used**  **current resin**  **prices**

**gathered from**  **industry research,**  **publicly available**  **publications such**  **as** Plastics News, **9 and** 

**interviews with**  **manufacturers. Resin**  **prices are**  **determined by**  **quantity and**  **supplier (i.e.,** 

**contract specific)**  **and therefore**  **have no**  **true fixed**  **market price.**  **For this**  **analysis, DOE**  **used**

**market resin**  **prices current**  **as of**  **June 2008.**  **The prices**  **of resins**  **have been**  **constantly increasing** 

**5­18 and**  **closely follow**  **petroleum prices.**  **Table 5.6.5**  **shows the**  **current resin**  **prices used**  **in the** 

**analysis.**

Table 5.6.5 Resin Prices as of June 2008

Resins Cost ($/lb)

(2007$)

**Polystyrene (PS)**  **$0.66**

**Polypropylene (PP)**  **$0.58**

**Polypropylene with**  **glass fiber**  **(PPGF) $0.84** 

**Acrylonitrile Butadiene**  **Styrene (ABS)**  **$0.71**

**Nylon­6 (PA6)**  **$1.53**

**Silicone $4.00** 

**Styrofoam $0.66** 

**Styrene­Butadiene Rubber**  **(SBR) $0.78** 

**Ethylene Propylene**  **Diene Monomer**  **(EPDM) $1.76** 

5.6.8 MPC Breakdown

**After DOE**  **incorporated all**  **of these**  **estimates into**  **the cost**  **model, the**  **different production** 

**costs percentages**  **were calculated.**  **The equipment**  **cost percentages**  **are used**  **as validation**  **of the** 

**assumptions by**  **comparing them**  **to manufacturers’**  **actual financial**  **data that**  **are published**  **in**

**annual reports.**  **DOE also**  **used these**  **figures in**  **the manufacturer**  **impact analysis**  **(MIA) (see** 

**chapter 12).**  **DOE calculated**  **the average**  **equipment costs**  **percentages by**  **equipment type** 

**(standard and**  **non­standard size)**  **due to**  **the large**  **variations in**  **production volumes,**  **fabrication**

**and assembly**  **costs, and**  **other assumptions**  **that affect**  **the calculation**  **of the**  **unit’s total**  **MPC.**

**Table 5.6.6**  **shows the**  **different percentages**  **for the**  **production costs**  **that make**  **up the**  **total**

**equipment MPC.** 

Table 5.6.6 Total Equipment MPC Breakdown

Production Costs Percent of Total Equipment MPC

Standard Size

PTAC and PTHP Non­Standard Size

PTAC and PTHP

**Materials 84.61%**  **67.15%**

**Labor 4.17%**  **11.16%**

**Overhead 6.86%**  **12.27%**

**Depreciation 4.36%**  **9.42%**

5.7 ENGINEERING MANUFACTURER INTERVIEWS

**Throughout the**  **rulemaking process,**  **DOE seeks**  **feedback and**  **insight from**  **stakeholders**

**to improve**  **the information**  **used in**  **the analyses.**  **For the**  **engineering analysis,**  **DOE discussed** 

**the analysis**  **assumptions and**  **estimates, cost**  **model, and**  **preliminary cost­efficiency**  **curves with** 

**various PTAC**  **and PTHP**  **manufacturers. DOE**  **considered all**  **the information**  **manufacturers**

**provided when**  **refining the**  **cost model.**  **DOE incorporated**  **equipment and**  **manufacturing**

**5­19 process**  **figures into**  **the analysis**  **in the**  **form of**  **averages to**  **avoid disclosing**  **sensitive information** 

**about individual**  **manufacturers’ equipment**  **or manufacturing**  **processes.**

**Before the**  **interviews, DOE**  **gave manufacturers**  **an engineering**  **package that**  **included**

**possible questions**  **to be**  **asked during**  **the interview**  **and a**  **spreadsheet with**  **preliminary**

**assumptions, estimates,**  **and results**  **(cost­efficiency curves).**  **DOE asked**  **manufacturers to** 

**provide feedback**  **if the**  **data was**  **representative of**  **the market**  **and to**  **supply any**  **data that**  **could**

**improve DOE’s**  **estimates and**  **assumptions. DOE’s**  **questions included**  **the following:** 

• **Which design**  **features affecting**  **energy use**  **are generally**  **incorporated into**  **“baseline”**

**PTACs and**  **PTHPs?**

• **What are**  **the costs**  **of attaining**  **the individual**  **efficiency levels**  **selected? How**  **do**

**these efficiency**  **levels correspond**  **to the**  **various design**  **options listed?**  **What other** 

**design options**  **do you**  **use to**  **attain the**  **various efficiency**  **levels?**

• **Are the**  **industry manufacturing**  **costs we**  **have calculated**  **representative of**  **your firm’s** 

**costs for**  **new construction**  **as well**  **as replacement**  **units?**

**DOE also**  **asked manufacturers**  **to supply**  **any engineering**  **insight on**  **the use**  **of R­410A**  **as**

**an alternative**  **refrigerant. DOE**  **used the**  **information it**  **gathered in**  **various parts**  **of the** 

**engineering analysis,**  **including the**  **sensitivity and**  **alternative refrigerant**  **analyses.**

5.7.1 Key Issues Discussed

**By far,**  **the major**  **issue for**  **all manufacturers**  **affected by**  **this rulemaking**  **is the**  **R­22**

**refrigerant phaseout**  **and the**  **methodology DOE**  **is considering**  **using to**  **account for**  **the phase­out** 

**in its**  **energy conservation**  **standards rulemaking.**  **Section 5.10**  **provides further**  **details on**  **the**

**refrigerant phase­out**  **and related**  **manufacturer feedback.** 

**Some estimates**  **of component**  **prices were**  **lower than**  **what manufacturers**  **were observing** 

**in the**  **market. Specifically,**  **some manufacturers**  **said that**  **the preliminary**  **engineering analysis** 

**compressor prices**  **were a**  **bit low.**  **The main**  **reasons manufacturers**  **gave for**  **having higher** 

**compressor cost**  **estimates include**  **lower purchase**  **volumes, increases**  **in compressor**  **prices due** 

**to metal**  **price fluctuations,**  **and price**  **differences due**  **to the**  **location of**  **the compressor** 

**manufacturer (i.e.,**  **domestic versus**  **foreign). DOE**  **revised its**  **cost estimates**  **after speaking**  **with**

**both PTAC**  **and PTHP**  **manufacturers as**  **well as**  **compressor manufacturers**  **about volume**  **pricing**

**for this**  **industry.**

**According to**  **several manufacturers,**  **the preliminary**  **engineering analysis**  **labor rates** 

**were lower**  **than what**  **is commonly**  **observed in**  **both the**  **standard and**  **non­standard size**  **PTAC**

**and PTHP**  **industry. The**  **most common**  **reason manufacturers**  **gave for**  **the differences**  **in labor** 

**rates is**  **the location**  **of manufacturing.**  **In the**  **preliminary engineering**  **analysis, DOE**  **estimated**

**100 percent**  **foreign labor**  **rates based**  **on other**  **rulemakings and**  **market research.**  **Domestic**

**manufacturers also**  **stated that**  **observed labor**  **rates differ**  **significantly amounts**  **between states,** 

**5­20 which**  **could distort**  **the industry**  **rates. DOE**  **readjusted labor**  **rates based**  **on the**  **information**

**manufacturers of**  **standard and**  **non­standard size**  **PTACs and**  **PTHPs provided**  **to include**  **both**

**domestic and**  **foreign labor**  **rates for**  **the industry**  **(for more**  **information see**  **section 5.6.5).** 

**All manufacturers**  **stated that**  **the cost­efficiency**  **relationship for**  **PTACs and**  **PTHPs**

**should follow**  **an exponential**  **or increasing**  **curve (i.e.,**  **as the**  **equipment efficiency**  **increases, it** 

**becomes increasingly**  **difficult and**  **more costly**  **to manufacture).**  **In addition,**  **manufacturers also** 

**stated their**  **material prices**  **were much**  **higher than**  **those reflected**  **in DOE’s**  **analysis. DOE’s** 

**analysis uses**  **a five­year**  **average material**  **price in**  **the cost**  **model. However,**  **because of**  **this**

**feedback, DOE**  **conducted a**  **material price­sensitivity**  **analysis with**  **2008 material**  **prices to**  **see**

**the affects**  **on the**  **cost­efficiency relationship**  **with current**  **pricing (see**  **section 5.11).** 

5.8 MANUFACTURER MARKUP

**To meet**  **amended energy**  **conservation standards,**  **manufacturers often**  **introduce design** 

**changes to**  **their product**  **lines, which**  **often result**  **in increased**  **MPCs. Depending**  **on the** 

**competitive environment**  **for this**  **particular equipment,**  **some or**  **all of**  **the increased**  **production**

**costs can**  **be “passed­through”**  **from manufacturers**  **to retailers**  **and eventually**  **to customers**  **in the** 

**form of**  **higher purchase**  **prices. As**  **production costs**  **increase, manufacturers**  **also typically**  **incur**

**additional overhead**  **at both**  **the factory**  **and corporate**  **levels. The**  **MSP must**  **cover both**  **of these** 

**additional contributions**  **to overhead**  **if a**  **company is**  **to maintain**  **its profitability.**  **As discussed** 

**previously, overhead**  **costs within**  **the DOE**  **model are**  **a function**  **of investments,**  **material costs,** 

**labor costs,**  **or total**  **costs, depending**  **on the**  **overhead category.**  **Together, materials,**  **labor, and** 

**factory overhead**  **comprise the**  **full production**  **cost. DOE**  **applies another**  **multiplier to**  **the full** 

**production cost**  **to account**  **for corporate**  **non­production costs**  **and profit.**  **This latter**  **multiplier,**

**the non­production**  **cost markup,**  **is the**  **focus of**  **this section.** 

**In this**  **section, DOE**  **presents its**  **methodology for**  **converting the**  **MPCs to**  **MSPs, referred** 

**to as**  **the** non­production cost markup **(“manufacturer markup”).**  **The manufacturer**  **markup is**  **an**

**integral part**  **of the**  **overall markup.**  **The overall**  **markup also**  **includes the**  **markups in**  **the**

**distribution chain**  **(e.g., wholesalers,**  **distributors, retailers,**  **contractors, etc.).**  **The distribution** 

**chain markups**  **convert MSP**  **to customer**  **price. The**  **customer prices**  **and installation**  **costs are** 

**key inputs**  **to the**  **life­cycle cost**  **(LCC) analysis,**  **payback period**  **(PBP) analysis,**  **and the**  **national**

**impact analysis**  **(NIA). Through**  **the use**  **of the**  **manufacturer and**  **distribution chain**  **markups (and** 

**installation costs),**  **DOE can**  **calculate the**  **first costs**  **that customers**  **would face**  **under the**  **various**

**trial standard**  **levels evaluated.**  **DOE evaluates**  **the tradeoff**  **between the**  **increase in**  **first cost**  **and**

**the resulting**  **energy cost**  **savings at**  **each candidate**  **standard level**  **in the**  **LCC and**  **PBP analyses** 

**(see Chapter**  **8), and**  **NIA analysis**  **(see Chapter**  **10).**

**The manufacturer**  **markup also**  **has an**  **important bearing**  **on the**  **manufacturers’**

**profitability. A**  **high markup**  **under a**  **standards scenario**  **suggests manufacturers**  **can pass** 

**through the**  **increased variable**  **costs and**  **some of**  **the capital**  **and product**  **conversion costs**  **(the**

**one­time expenditures).**  **A low**  **markup implies**  **that manufacturers**  **will not**  **be able**  **to recover**  **as**

**much of**  **the necessary**  **investment in**  **plant and**  **equipment.**

**5­21**5.8.1 Manufacturer Financial Information Sources

**Publicly owned**  **companies are**  **required by**  **law to**  **disclose financial**  **information on**  **a**

**regular basis**  **by filing**  **different forms**  **with the**  **U.S. Securities**  **and Exchange**  **Commission (SEC).** 

**The SEC**  **form 10­K,**  **d filed**  **by companies**  **on an**  **annual basis,**  **provides a**  **comprehensive**

**overview of**  **the company’s**  **business and**  **financial conditions.**  **Relevant information**  **in the**  **10­K**

**reports includes**  **the company’s**  **revenues and**  **direct and**  **indirect costs.**  **For the**  **manufacturer**

**markups, DOE**  **used 10­K**  **reports from**  **four publicly**  **owned PTAC**  **and PTHP**  **companies. The** 

**financial figures**  **necessary for**  **calculating the**  **manufacturer markup**  **are net**  **sales, costs**  **of sales,** 

**and gross**  **profit. e**  **The income**  **statement section**  **of the**  **10­K reports**  **often lists**  **these figures.** 

5.8.2 Manufacturing Production Cost

**The MPC**  **is the**  **sum cost**  **of materials,**  **labor, and**  **direct overhead**  **used to**  **manufacture a** 

**piece of**  **equipment. f**  **Figure 5.8.1**  **shows the**  **general breakdown**  **of costs**  **associated with** 

**manufacturing a**  **piece of**  **equipment.**

**d PTAC**  **and PTHP**  **manufacturers’ SEC**  **10­K reports**  **are available**  **as text**  **or html**  **files on**  **the U.S.**  **SEC webpage**  **at**

**http://www.sec.gov/edgar.shtml.**

**e Depending**  **on the**  **manufacturer, the**  **gross profit**  **is listed**  **instead of**  **the cost**  **of sales**  **figures.**

**f When**  **viewed from**  **the company­wide**  **perspective, the**  **sum of**  **all material,**  **labor, and**  **overhead costs**  **equals the** 

**company’s sales**  **cost, also**  **referred to**  **as the**  **cost of**  **goods sold**  **(COGS).**

**5­22**Figure 5.8.1 Full Production Costs

**The full**  **cost of**  **production is**  **broken down**  **into two**  **main costs,**  **the full**  **production cost** 

**or MPC,**  **and the**  **non­production cost.**  **The non­production**  **cost is**  **equal to**  **the manufacturer** 

**markup minus**  **profits.**

**Other than**  **obtaining detailed**  **manufacturing costs**  **directly from**  **a manufacturer,**  **the most** 

**accurate method**  **for determining**  **the MPC**  **of a**  **unit is**  **by physical**  **and virtual**  **teardowns. As** 

**described in**  **previous sections,**  **DOE derived**  **manufacturing costs**  **by physically**  **tearing down** 

**PTACs and**  **PTHPs and**  **constructing a**  **bill of**  **materials for**  **each unit.**  **The MPC**  **is used**  **to**

**calculate the**  **MSP.**

**5­23**5.8.3 Manufacturer Selling Price

**The MSP**  **is the**  **price at**  **which the**  **manufacturer can**  **recover all**  **production and**  **non**

**production costs**  **g and**  **earn a**  **profit. DOE**  **calculated the**  **PTAC and**  **PTHP MSP**  **by multiplying** 

**the MPCs**  **by the**  **calculated manufacturer**  **markup, which**  **is explained**  **below.**

5.8.4 Manufacturing Markup Calculation

**A manufacturer**  **markup is**  **applied to**  **the MPC**  **of the**  **equipment to**  **arrive at**  **the MSP.**  **In**

**general, the**  **manufacturer markup**  **should ensure**  **that the**  **MSP of**  **the equipment**  **is high**  **enough to** 

**recover the**  **full cost**  **of the**  **equipment (i.e.,**  **full production**  **and non­production**  **costs), and**  **yield a** 

**satisfactory profit.** 

**DOE calculated**  **the baseline**  **manufacturer markups**  **by using**  **financial figures**  **from**

**manufacturers’ SEC**  **10­K reports,**  **such as**  **the net**  **sales (revenues)**  **and cost**  **of sales**  **to calculate** 

**gross profit**  **h and**  **gross profit**  **margins. DOE**  **used averages**  **of the**  **financial figures**  **spanning 1998** 

**to 2005**  **and then**  **calculated the**  **markups.**

**DOE used**  **the following**  **equations to**  **calculate the**  **gross profit**  **and gross**  **profit margins:** 

**Gross Profit** 

**= Net**  **Sales**

**– Cost**  **of Sales** 

**.**

**Gross Profit** 

**Gross Profit**  **Margin**

= **Net Sales** 

**Table 5.8.1**  **contains the**  **calculated gross**  **profit margins**  **for all**  **manufacturers.**

**g Non­production**  **costs include**  **selling, general,**  **and administration**  **(SG&A) costs,**  **the cost**  **of research**  **and**

**development, and**  **interest.**

**h This**  **is the**  **amount of**  **money a**  **company retains**  **after subtracting**  **the cost**  **of sales**  **from net**  **sales.**

**5­24**Table5.8.1GrossProfitMarginforPTACandPTHPManufacturers*ManufacturerFinancialFigureYear20052004200320022001200019991998A**NetSales$CostofSales$GrossProfit$GrossProfitMargin**1,565,406 1,297,295** **1,192,671 1,136,188** **1,082,076 1,243,408** **1,005,955 915,272** **884,204 821,454** **321,998 291,340** **277,399 251,984** **260,622**20.6%22.5%23.3%22.2%24.1%AverageGrossProfitMargin22.4%B**NetSales$CostofSales$GrossProfit$GrossProfitMargin**805,732 870,854** **867,704 924,028** **965,749 596,249** **638,825 641,346** **691,222 709,639** **209,483 232,029** **226,358 232,806** **256,110**26.0%26.6%26.1%25.2%26.5%AverageGrossProfitMargin26.1%CNetSales$CostofSales$GrossProfit$GrossProfitMargin**297,716 399,485** **416,201 373,702** **405,697 416,181** **362,048 327,912** **258,040 344,035** **329,510 290,652** **336,997 311,353** **277,457 265,142** **39,676 55,450** **86,691 83,050** **68,700 104,828** **84,591 62,770** 13.3%13.9%20.8%22.2%16.9%25.2%23.4%19.1%AverageGrossProfitMargin19.5%DNetSales$CostofSales$GrossProfit$GrossProfitMargin**10,264,400 9,508,800** **8,567,600 7,795,400** **7,465,300 7,598,400** **7,189,500 6,555,349** **7,523,600 6,952,300** **6,477,500 5,912,900** **5,617,500 5,727,700** **5,406,605 4,949,576** **2,740,800 2,556,500** **2,090,100 1,882,500** **1,847,800 1,870,700** **1,782,895 1,605,873** 26.7%26.9%24.4%24.1%24.8%24.6%24.8%24.5%AverageGrossProfitMargin25.2%**Note: Figures** **in thousands** **of dollars** *******2000, 2002,** **2003, 2004,** **and 2005,** **SEC 10­K** **reports.**********Data is** **not available** **for missing** **years 5­25** **To calculate**  **the time­average**  **gross profit**  **margin for**  **each firm,**  **DOE first** 

**summed the**  **gross profit**  **for all**  **the years**  **and then**  **divided the**  **result by**  **the sum**  **of the**  **net**

**sales for**  **the same**  **years. Each**  **manufacturer’s non­production**  **cost markup**  **was**

**calculated as:** 

**Gross Profit**  **Margin Gross**  **Profit**

**Non ­ production**  **cost markup** 

= = **(1­ Gross Profit Margin) Cost of Sales** 

**Table 5.8.2**  **shows the**  **manufacturer markups**  **using this**  **method.**

Table 5.8.2 Calculated Manufacturer Markups

Manufacturer Manufacturer Markup

**Manufacturer A**  **1.29**

**Manufacturer B**  **1.35**

**Manufacturer C**  **1.24**

**Manufacturer D**  **1.34**

Weighted Average ***** 1.29

***** **Weighted average**  **takes into**  **account the**  **market share**  **relevant to**  **each manufacturer,**  **rather than**  **treating**

**each manufacturer**  **equally.**

**DOE calculated**  **the manufacturer**  **markup for**  **four manufacturers**  **from the**  **PTAC**

**and PTHP**  **industry to**  **range from**  **1.24 to**  **1.35. The**  **variance in**  **markups among** 

**manufacturers can**  **be attributed**  **to (1)**  **differences in**  **part suppliers**  **and part**  **costs that** 

**affect the**  **overall material**  **cost; (2)**  **differences in**  **worker wages;**  **and (3)**  **differences in** 

**market share.**  **Such differences**  **can also**  **be attributed**  **to the**  **fact that**  **the manufacturers** 

**DOE evaluated**  **make a**  **variety of**  **equipment and**  **the available**  **financial information**  **is**

**distorted by**  **data on**  **equipment other**  **than PTACs**  **and PTHPs.** 

**The weighted**  **average manufacturer**  **markup was**  **calculated by**  **using publicly** 

**available market**  **share numbers**  **(i.e., some**  **manufacturers estimate**  **their market**  **shares**

**and report**  **the data**  **in the**  **SEC 10K**  **reports). The**  **weighted average**  **manufacturer markup** 

**means that**  **on average,**  **PTAC and**  **PTHP manufacturers**  **sell their**  **equipment to**  **the next** 

**party in**  **the distribution**  **channel at**  **29 percent**  **above the**  **full production**  **cost. The**  **1.29**

**multiplier is**  **used in**  **the engineering**  **analysis to**  **determine the**  **MSP for**  **the baseline** 

**equipment and**  **for all**  **equipment that**  **is more**  **efficient.**

5.9 COST VERSUS EFFICIENCY CURVES

5.9.1 Baseline Unit

**Using the**  **equipment information**  **gained from**  **the teardown**  **analysis and** 

**engineering manufacturing**  **interviews, DOE**  **defined the**  **characteristics of**  **the market** 

**baseline units**  **for each**  **representative cooling**  **capacity within**  **the different**  **equipment.**

**These characteristics**  **include dimensions,**  **numbers of**  **components, and**  **other equipment** 

**features that**  **are necessary**  **to calculate**  **the EER**  **and MPC**  **of each**  **unit within**  **each**

**5­26 equipment**  **class. The**  **market baseline**  **characteristics define**  **the energy**  **efficiency and** 

**cost of**  **the typical**  **minimum technology**  **equipment on**  **the market.**  **Table 5.9.1**  **shows the** 

**characteristics defined**  **for each**  **baseline unit.** 

Table 5.9.1 Market Baseline Units CharacteristicsEquipmentClasses

Characteristics**Standard Size** **PTAC 9,000** **Btu/h Standard** **Size PTHP** **9,000 Btu/h** **Standard Size** **PTAC 12,000** **Btu/h Standard** **Size PTHP** **12,000 Btu/h** **Non­Standard Size** **PTAC 11,000** **Btu/h Non­Standard** **Size PTHP** **11,000 Btu/h** 

**Lower efficiency**  **rotary**

**compressor X**  **X X**  **X X**  **X**

**Simple electromechanical**  **control**

**board (heat**  **pump type)**  **X X**  **X**

**Simple electromechanical**  **control**

**board (air**  **conditioner type)**  **X X**  **X**

**Condenser heat**  **exchanger with** 

**single coil**  **row X**  **X X**  **X X**  **X**

**Evaporator heat**  **exchanger with** 

**two coil**  **rows X**  **X X**  **X X**  **X**

**Reversing valve**  **X X**  **X**

**High­efficiency PSC**  **fan motor**  **X X**  **X X**  **X X** 

**DOE established**  **baseline characteristics**  **for each**  **of the**  **equipment classes** 

**modeled in**  **the engineering**  **analysis by**  **reviewing available**  **manufacturer data,**  **selecting**

**several representative**  **units from**  **available manufacturer**  **data, and**  **then aggregating**  **the**

**physical characteristics**  **of the**  **selected units.**  **This process**  **created a**  **representative unit** 

**for each**  **equipment class**  **with average**  **characteristics for**  **physical parameters**  **(e.g., heat** 

**exchanger area),**  **and minimum**  **performance of**  **energy­consuming components**  **(e.g.,**

**motors, compressors).** 

**DOE identified**  **the market**  **baseline units’**  **EER from**  **current PTACs**  **and PTHPs** 

**on the**  **market that**  **use technologies**  **commonly incorporated**  **in the**  **equipment design.** 

**Table 5.9.2**  **shows the**  **equipment classes,**  **the representative**  **cooling capacity**  **for the** 

**market baseline**  **units, and**  **their respective**  **EER.**

**5­27**Table 5.9.2 Baseline Unit EER

Equipment Class Cooling Capacity (Btu/h) Baseline (ASHRAE Standard

90.1­1999) (EER)

**PTAC 9,000**  **10.6**

**(Standard Size)**  **12,000 9.9** 

**PTHP 9,000**  **10.4**

**(Standard Size)**  **12,000 9.7** 

**PTAC**

**(Non­Standard Size)**  **11,000 8.6** 

**PTHP**

**(Non­Standard Size)**  **11,000 8.5** 

**The market**  **baseline unit**  **identified in**  **the engineering**  **analysis represents**  **the**

**energy efficiency**  **and cost**  **of the**  **typical minimum**  **technology equipment**  **on the**  **market.**

**DOE used**  **the efficiency**  **levels in**  **ASHRAE Standard**  **90.1­1999 as**  **the baseline** 

**efficiencies in**  **order to**  **estimate the**  **impacts of**  **standards more**  **stringent than**  **ASHRAE**

**Standard 90.1­1999.**  **ASHRAE Standard**  **90.1­1999 is**  **the least**  **stringent energy** 

**efficiency level**  **DOE could**  **adopt since**  **EPCA directs**  **that if**  **ASHRAE Standard**  **90.1 is** 

**amended, DOE**  **must adopt**  **an amended**  **standard at**  **the new**  **level in**  **Standard 90.1**  **unless,**

**as indicated**  **above, clear**  **and convincing**  **evidence supports**  **a determination**  **that adoption** 

**of a**  **more stringent**  **level as**  **a national**  **standard would**  **produce significantly**  **more energy** 

**savings and**  **be technologically**  **feasible and**  **economically justified.**  **(42 U.S.C.** 

**6313(a)(6)(A)) Consequently,**  **the minimum**  **level DOE**  **could adopt**  **in this**  **rulemaking**

**proceeding would**  **be the**  **efficiency levels**  **contained in**  **ASHRAE Standard**  **90.1­1999.**

**Thus, DOE**  **is evaluating**  **in this**  **rulemaking whether**  **efficiency levels**  **above those** 

**contained in**  **ASHRAE Standard**  **90.1­1999 are**  **technologically feasible**  **and economically** 

**justified.**

5.9.2 “Max Tech” Efficiency Levels

**DOE has**  **determined the**  **maximum improvement**  **in energy**  **efficiency that**  **is**

**technologically feasible**  **(“max tech”)**  **for PTACs**  **and PTHPs.**  **Although EPCA**  **does not** 

**require DOE**  **to adopt**  **amended energy**  **conservation standards**  **for equipment**  **covered by** 

**ASHRAE Standard**  **90.1 that**  **achieve the**  **maximum improvement**  **in energy**  **efficiency**

**that is**  **technologically feasible**  **and economically**  **justified, DOE**  **has chosen**  **to structure** 

**the analysis**  **in a**  **similar fashion**  **to that**  **for residential**  **products required**  **by section**  **325(o)**

**of EPCA.**  **(42 U.S.C.**  **6295(o)) In**  **particular, EPCA**  **does not**  **require DOE**  **to identify**  **the**

**“max tech”**  **efficiency levels**  **during its**  **review of**  **amended ASHRAE**  **standards. DOE** 

**structured the**  **analysis as**  **outlined by**  **EPCA in**  **section 325(o)**  **because it**  **provides a** 

**rationale methodology**  **for considering**  **different amended**  **energy conservation**  **standard**

**levels for**  **various consumer**  **products. DOE**  **will apply**  **the same**  **requirements in** 

**considering amended**  **energy conservation**  **standards as**  **found in**  **section 325(o)**  **of EPCA.** 

**(42 U.S.C.**  **6295(o)). Therefore,**  **in reviewing**  **the amended**  **ASHRAE Standard**  **90.1**

**efficiency standards**  **for PTACs**  **and PTHPs,**  **DOE identified**  **the “max**  **tech” levels**  **as part** 

**of the**  **engineering analysis.**  **For the**  **representative cooling**  **capacities within**  **a given** 

**equipment class,**  **PTACs and**  **PTHPs utilizing**  **R­22 with**  **these efficiency**  **levels already** 

**are being**  **sold in**  **small quantities.**  **No working**  **prototypes of**  **equipment at**  **higher**

**efficiency levels**  **are currently**  **available. Table**  **5.9.3 lists**  **the “max**  **tech” levels**  **for**

**5­28 equipment**  **currently on**  **the market**  **utilizing R­22**  **that DOE**  **determined for**  **this**

**rulemaking.**

Table 5.9.3 **“** Max Tech” Efficiency Levels utilizing R­22 (≥7,000 Btu/h and ≤15,000

Btu/h Equipment Classes)

Equipment

Type Equipment Class Cooling

Capacity “Max Tech”

Efficiency Level*

**Standard Size**  ****** **9,000 Btu/h**  **12.0 EER** 

**PTAC**

**12,000 Btu/h**  **11.5 EER** 

**Non­standard Size**  † **11,000 Btu/h**  **11.2 EER** 

**Standard Size**  ****** **9,000 Btu/h**  **12.0 EER** 

**3.5 COP** 

**PTHP 12,000**  **Btu/h 11.7**  **EER**

**3.3 COP** 

**Non­standard Size**  † **11,000 Btu/h**  **11.4 EER** 

**2.9 COP** 

***** **For equipment**  **rated according**  **to the**  **DOE test**  **procedure, all**  **EER values**  **would be**  **rated at**  **95oF outdoor** 

**dry­bulb temperature**  **for air­cooled**  **equipment and**  **evaporatively­cooled products**  **and at**  **85oF entering** 

**water temperature**  **for water**  **cooled equipment.**  **All COP**  **values must**  **be rated**  **at 47oF**  **outdoor dry­bulb** 

**temperature for**  **air­cooled equipment,**  **and at**  **70oF entering**  **water temperature**  **for water­source**  **heat pumps.** 

****** **Standard size**  **refers to**  **PTAC or**  **PTHP equipment**  **with wall**  **sleeve dimensions**  **having an**  **external wall** 

**opening of**  **greater than**  **or equal**  **to 16**  **inches high**  **or greater**  **than or**  **equal to**  **42 inches**  **wide, and**  **having a** 

**cross­sectional area**  **greater than**  **or equal**  **to 670**  **inches squared.** 

**† Non­standard**  **size refers**  **to PTAC**  **or PTHP**  **equipment with**  **existing wall**  **sleeve dimensions**  **have an** 

**external wall**  **opening of**  **less than**  **16 inches**  **high or**  **less than**  **42 inches**  **wide, and**  **having a**  **cross­sectional**

**area less**  **than 670**  **inches squared.** 

5.9.3 Design Option Approach

**DOE developed**  **the cost­efficiency**  **curves using**  **a design**  **option approach.**  **DOE**

**used each**  **design option**  **identified in**  **the screening**  **analysis to**  **improve the**  **equipment’s**

**efficiency above**  **the baseline**  **based on**  **its cost­effectiveness.**  **While DOE**  **recognizes that** 

**manufacturers use**  **many different**  **design options**  **and approaches**  **to increase**  **the**

**efficiency of**  **PTACs and**  **PTHPs, the**  **presented design**  **options and**  **their ordering**  **is one** 

**possible way**  **manufacturers could**  **reach max­tech.** 

**As described**  **in section**  **5.6, DOE**  **estimated the**  **MPC of**  **each design**  **option and** 

**the baseline**  **units for**  **each equipment**  **class. DOE**  **then calculated**  **the ratio**  **of incremental** 

**MPC to**  **the incremental**  **EER for**  **each design**  **option (i.e.,**  **incremental MPC**  **divided by** 

**incremental EER).**  **This calculation**  **allowed DOE**  **to rank**  **each design**  **option by**  **cost**

**effectiveness. DOE**  **added the**  **MPC of**  **each ranked**  **design option**  **to the**  **MPC of**  **the**

**baseline unit**  **to calculate**  **the corresponding**  **MPC at**  **each efficiency**  **level. DOE** 

**5­29 multiplied**  **the results**  **by the**  **manufacturer markups**  **to calculate**  **the MSPs.**  **The result**  **is a** 

**list of**  **efficiency levels**  **and the**  **corresponding incremental**  **MSP for**  **each equipment**  **class**

**analyzed. Table**  **5.9.4 through**  **Table 5.9.9**  **shows the**  **efficiency levels**  **and the** 

**corresponding MPC**  **of each**  **design option**  **for each**  **equipment class.** 

Table 5.9.4 Standard Size PTAC 9,000 Btu/h Cooling Capacity R­22 Refrigerant

Design Options

Design Option EER Increase Incremental MPC

(2006$)

**Design Option**  **1**

**(Added 1**  **row to**  **condenser heat**  **exchanger ­ 2x2** 

**coil rows)**  **0.9 $13.22** 

**Design Option**  **2**

**(Replaced compressor**  **with high**  **efficiency**

**compressor) 0.8**  **$15.34**

**Design Option**  **3**

**(Increased heat**  **exchanger area**  **by 20**  **percent) 0.5**  **$11.09**

**Design Option**  **4 (Max­tech)** 

**(Re­circuiting coils)**  **0.1 $4.29** 

Table 5.9.5 Standard Size PTHP 9,000 Btu/h Cooling Capacity R­22 Refrigerant

Design Options

Design Option EER Increase Incremental MPC

(2006$)

**Design Option**  **1**

**(Added 1**  **row to**  **condenser heat**  **exchanger ­ 2x2** 

**coil rows)**  **0.9 $13.22** 

**Design Option**  **2**

**(Replaced compressor**  **with high**  **efficiency**

**compressor) 0.8**  **$15.34**

**Design Option**  **3**

**(Increased heat**  **exchanger area**  **by 20**  **percent) 0.5**  **$11.09**

**Design Option**  **4 (Max­tech)** 

**(Re­circuiting coils)**  **0.1 $4.29** 

Table 5.9.6 Standard Size PTAC 12,000 Btu/h Cooling Capacity R­22 Refrigerant

Design Options

Design Option EER Increase Incremental MPC

(2006$)

**Design Option**  **1**

**(Added 1**  **row to**  **condenser heat**  **exchanger ­ 2x2** 

**coil rows)**  **0.9 $14.30** 

**Design Option**  **2**

**(Increased heat**  **exchanger area**  **by 20**  **percent) 0.5**  **$14.51**

**Design Option**  **3**

**(Replaced compressor**  **with high**  **efficiency**

**compressor) 0.8**  **$24.22**

**Design Option**  **4 (Max­tech)** 

**(Re­circuiting coils)**  **0.1 $4.38** 

**5­30**Table 5.9.7 Standard Size PTHP 12,000 Btu/h Cooling Capacity R­22 Refrigerant

Design Options

Design Option EER Increase Incremental MPC

(2006$)

**Design Option**  **1**

**(Added 1**  **row to**  **condenser heat**  **exchanger ­ 2x2** 

**coil rows)**  **0.9 $14.30** 

**Design Option**  **2**

**(Increased heat**  **exchanger area**  **by 20**  **percent) 0.5**  **$14.51**

**Design Option**  **3**

**(Replaced compressor**  **with high**  **efficiency**

**compressor) 0.8**  **$24.22**

**Design Option**  **4 (Max­tech)** 

**(Re­circuiting coils)**  **0.1 $4.38** 

Table 5.9.8 Non­Standard Size PTAC 11,000 Btu/h Cooling Capacity R­22

Refrigerant Design Options

Design Option EER Increase Incremental MPC

(2006$)

**Design Option**  **1**

**(Added 1**  **row to**  **condenser heat**  **exchanger ­ 2x2** 

**coil rows)**  **0.9 $10.87** 

**Design Option**  **2**

**(Replaced compressor**  **with high**  **efficiency**

**compressor) 0.8**  **$18.62**

**Design Option**  **3**

**(Increased heat**  **exchanger area**  **by 20**  **percent) 0.5**  **$12.77**

**Design Option**  **4 (Max­tech)** 

**(Re­circuiting coils)**  **0.1 $5.63** 

Table 5.9.9 Non­Standard Size PTHP 11,000 Btu/h Cooling Capacity R­22

Refrigerant Design Options

Design Option EER Increase Incremental MPC

(2006$)

**Design Option**  **1**

**(Added 1**  **row to**  **condenser heat**  **exchanger ­ 2x2** 

**coil rows)**  **0.9 $10.87** 

**Design Option**  **2**

**(Replaced compressor**  **with high**  **efficiency**

**compressor) 0.8**  **$18.62**

**Design Option**  **3**

**(Increased heat**  **exchanger area**  **by 20**  **percent) 0.5**  **$12.77**

**Design Option**  **4 (Max­tech)** 

**(Re­circuiting coils)**  **0.1 $5.63** 

5.9.4 Cost­Efficiency Curves

**The result**  **of the**  **engineering analysis**  **is a**  **set of**  **cost­efficiency curves.**  **DOE**

**created six**  **curves corresponding**  **to the**  **representative cooling**  **capacities within**  **each**

**equipment class.**  **Figure 5.9.1**  **through Figure**  **5.9.6 show**  **the six**  **cost­efficiency curves**  **in**

**5­31 the**  **form of**  **EER versus**  **MPC. Table**  **5.9.10 lists**  **the curves**  **and their**  **corresponding**

**figure numbers.** 

Table 5.9.10 Cost­Efficiency Curves and Corresponding Figures for PTAC and

PTHP Equipment Utilizing R­22

Equipment Class Curve Shown in:

**Standard Size**  **PTACs 9,000**  **Btu/h Figure**  **5.9.1**

**Standard Size**  **PTHPs 9,000**  **Btu/h Figure**  **5.9.2**

**Standard Size**  **PTACs 12,000**  **Btu/h Figure**  **5.9.3**

**Standard Size**  **PTHPs 12,000**  **Btu/h Figure**  **5.9.4**

**Non­Standard Size**  **PTACs 11,000**  **Btu/h Figure**  **5.9.5**

**Non­Standard Size**  **PTHPs 11,000**  **Btu/h Figure**  **5.9.6**

**As stated**  **above, DOE**  **used the**  **cost­efficiency curves**  **from the**  **engineering**

**analysis as**  **an input**  **to subsequent**  **LCC analysis**  **to determine**  **the customer**  **price of** 

**PTACs and**  **PTHPs (see**  **chapter 8,**  **life­cycle cost**  **and payback**  **period analyses).** 

$300 $325 $350 $375 $400 $425 $450 $475 $500 $525 $550 $575 $600ManufacturerProductionCost(MPC)

MPC = 3.13(EER) 2

­ 49.32(EER) + 508.01

8.5 9 9.5 10 10.5 11 11.5 12

System EER

Standard Size PTAC 9,000 Btu/h ­ 5­Year Average Material Price R­22 Refrigerant

Figure 5.9.1 Manufacturer Production Cost (2007$) versus Efficiency for Standard

Size PTACs with a Cooling Capacity of 9,000 Btu/h, R­22 Refrigerant

**5­32** 12.5$300 $325 $350 $375 $400 $425 $450 $475 $500 $525 $550 $575 $600ManufacturerProductionCost(MPC)

MPC = 3.13(EER) 2

­ 49.32(EER) + 55 8.01

8.5 9 9.5 10 10.5 11 11.5 12

System EER

Standard Size PTHP 9,000 Btu/h ­ 5­Year Average Material Price R­22 Refrigerant

Figure 5.9.2 Manufacturer Production Cost (2007$) versus Efficiency for Standard

Size PTHPs with a Cooling Capacity of 9,000 Btu/h, R­22 Refrigerant

**5­33** 12.5$300 $325 $350 $375 $400 $425 $450 $475 $500 $525 $550 $575 $600ManufacturerProductionCost(MPC)

MPC = 5.55 (EER) 2

­ 89.94 (EER) + 7 3 1.21

8.5 9 9.5 10 10.5 11 11.5 12

System EER

Standard Size PTAC 12,000 Btu/h ­ 5­Year Average Material Price R­22 Refrigerant

Figure 5.9.3 Manufacturer Production Cost (2007$) versus Efficiency for Standard

Size PTACs with a Cooling Capacity of 12,000 Btu/h, R­22 Refrigerant

**5­34** 12.5$300 $325 $350 $375 $400 $425 $450 $475 $500 $525 $550 $575 $600ManufacturerProductionCost(MPC)

MPC = 5.55 (EER) 2

­ 89.94 (EER) + 7 8 1.21

8.5 9 9.5 10 10.5 11 11.5 12

System EER

Standard Size PTHP 12,000 Btu/h ­ 5­Year Average Material Price R­22 Refrigerant

Figure 5.9.4 Manufacturer Production Cost (2007$) versus Efficiency for Standard

Size PTHPs with a Cooling Capacity of 12,000 Btu/h, R­22 Refrigerant

**5­35** 12.5$300 $325 $350 $375 $400 $425 $450 $475 $500 $525 $550 $575 $600ManufacturerProductionCost(MPC)

MPC = 5.70 (EER) 2

­ 94.22 (EER) + 84 7.63

8.5 9 9.5 10 10.5 11 11.5 12

System EER

Non­Standard Size PTAC 11,000 Btu/h ­ 5­Year Average Material Price R­22 Refrigerant

Figure 5.9.5 Manufacturer Production Cost (2007$) versus Efficiency for NonStandard Size PTACs with a Cooling Capacity of 11,000 Btu/h, R­22

Refrigerant

**5­36** 12.5ManufacturerProductionCost(MPC) $600

$575

$550

$525

$500

$475

$450

$425

$400

$375

$350

$325

$300 MPC = 5.70 (EER) 2

­ 94.22 (EER) + 89 7.63

8.5 9 9.5 10 10.5 11 11.5 12

System EER

Non­Standard Size PTHP 11,000 Btu/h ­ 5­Year Average Material Price R­22 Refrigerant

Figure 5.9.6 Manufacturer Production Cost (2007$) versus Efficiency for NonStandard Size PTHPs with a Cooling Capacity of 11,000 Btu/h, R­22

Refrigerant

**The results**  **show that**  **the cost­efficiency**  **curves are**  **nonlinear. As**  **efficiency**

**increases, manufacturing**  **becomes more**  **difficult and**  **more costly**  **for manufacturers.**  **A**

**faster increase**  **in the**  **curve (i.e.,**  **steep slope)**  **is evident**  **for the**  **standard size**  **PTAC and** 

**PTHP with**  **12,000 Btu/h**  **cooling capacity**  **compared to**  **the standard**  **size PTAC**  **and**

**PTHP with**  **9,000 Btu/h**  **cooling capacity.**  **In addition,**  **the increase**  **in capacity**  **between**

**9,000 Btu/h**  **and 12,000**  **Btu/h causes**  **an increase**  **in the**  **baseline unit**  **MPC.**

**Similar results**  **are present**  **for the**  **non­standard size**  **PTAC and**  **PTHP. Due**  **to low** 

**production volumes,**  **higher labor**  **rates, and**  **other factory**  **parameters, non­standard**  **size**

**PTACs and**  **PTHPs have**  **a higher**  **baseline MPC**  **compared to**  **standard size**  **PTACs and** 

**PTHPs of**  **the same**  **cooling capacity**  **range. In**  **addition, for**  **non­standard size**  **PTACs and** 

**PTHPs, the**  **steep slope**  **of the**  **cost­efficiency curves**  **show that**  **as efficiency**  **increases,**

**manufacturing becomes**  **increasingly difficult**  **and costly.** 

5.10 ALTERNATIVE REFRIGERANT ANALYSIS

**In 1987,**  **the United**  **Nations Environment**  **Programme (UNEP)**  **adopted the** 

**Montreal Protocol**  **on Substances**  **that Deplete**  **the Ozone**  **Layer (“Montreal**  **Protocol”),**

**which regulates**  **the phaseout**  **of ozone­depleting**  **substances through**  **a collaborative**  **and**

**5­37** 12.5**international effort.**  **In 1988,**  **the United**  **States ratified**  **the Montreal**  **Protocol and**  **thus**

**committed to**  **the phaseout.** 

**In 1990,**  **the Clean**  **Air Act**  **was amended**  **to include**  **Title VI,**  **“Stratospheric Ozone** 

**Protection,” to**  **implement the**  **Montreal Protocol.**  **(42 U.S.C**  **7671, et**  **seq.) Title**  **VI**

**mandated the**  **phaseout by**  **2020 of**  **hydrochlorofluorocarbon (HCFC)**  **refrigerants for**  **use**

**in new**  **air­conditioning systems.**  **(42 U.S.C.**  **7671d) Title**  **VI, however,**  **also authorized** 

**the Environmental**  **Protection Agency**  **(EPA) to**  **accelerate this**  **date if**  **certain criteria**  **were**

**met, (42**  **U.S.C. 7671e)**  **and EPA**  **subsequently adopted**  **a rule**  **on December**  **10, 1993**  **to**

**require the**  **phaseout of**  **HCFC refrigerants**  **for use**  **in new**  **equipment by**  **2010. 58**  **FR**

**65018. R­22,**  **the only**  **refrigerant currently**  **used by**  **PTACs and**  **PTHPs, is**  **an HCFC** 

**refrigerant. Phaseout**  **of this**  **refrigerant could**  **have a**  **significant impact**  **on**

**manufacturing, performance,**  **and cost**  **of PTAC**  **and PTHP**  **equipment.**

**As part**  **of the**  **engineering analysis,**  **DOE performed**  **an alternative**  **refrigerant**

**analysis to**  **characterize the**  **performance implications**  **on PTACs**  **and PTHPs.**  **This**

**analysis included**  **researching technical**  **journal reports,**  **discussion with**  **industry experts** 

**and manufacturers,**  **and developing**  **an analysis**  **that used**  **the methodology**  **DOE used**  **in**

**performing the**  **engineering analysis**  **as to**  **equipment using**  **the R­22**  **refrigerant.**

5.10.1 Alternative Refrigerant Selection

**Several alternative**  **refrigerants are**  **under consideration**  **as substitutes**  **for R­22.** 

**While R­407C**  **has similar**  **pressure­temperature characteristics**  **as R­22**  **and thus**  **is more** 

**easily adapted**  **to existing**  **R­22 designs,**  **it is**  **less efficient.**  **R­410A, a**  **hydrofluorocarbon**

**(HFC), operates**  **at higher**  **pressures than**  **R­22, thus**  **possibly requiring**  **redesign of**  **R­22**

**equipment. However,**  **R­410A offers**  **efficiency benefits**  **relative to**  **R­407C. In**  **response**

**to publication**  **of the**  **March 13,**  **2006 notice**  **of document**  **availability (71**  **FR 12634),** 

**AHRI commented**  **that R­410A**  **is the**  **most likely**  **replacement refrigerant**  **for R­22**  **in**

**standard and**  **non­standard size**  **PTACs and**  **PTHPs. (Docket**  **No. EE­RM/STD­03­100,** 

**EE­RM/STD­03­200, EE­RM/STD­03­300,**  **AHRI, No.**  **26 at**  **pp. 2­3)**  **i Every** 

**manufacturer interview**  **confirmed that**  **the industry**  **is planning**  **to substitute**  **R­410A for** 

**R­22 in**  **PTACs and**  **PTHPs. Industry**  **expressed a**  **preference for**  **R­410A due**  **to its** 

**performance similarities**  **to R­22**  **and experience**  **with other**  **HVAC equipment**  **use R­** 

**“ARI, No.**  **26 at**  **pp 2** 

**– 3”**  **refers to**  **(1) to**  **a statement**  **that was**  **submitted by**  **the Air**  **Conditioning and** 

**Refrigeration Institute**  **and is**  **recorded in**  **the Resource**  **Room of**  **the Building**  **Technologies Program**  **in the** 

**docket under**  **“Energy Efficiency**  **Program for**  **Commercial and**  **Industrial Equipment:**  **Efficiency Standards** 

**for Commercial**  **Heating, Air­ Conditioning**  **and Water**  **Heating Equipment,”**  **Docket Number**  **EE­RM­STD**

**03­100, EE­RM­STD­03­200,**  **and EE­RM­STD­03­300,**  **as comment**  **number 26;**  **and (2)**  **a passage**  **that**

**appears on**  **pages 2**  **and 3**  **of that**  **statement.**

**5­38 i** **410A. Therefore,**  **DOE performed**  **its alternative**  **refrigerant analysis**  **based on**  **the use**  **of**

**R­410A.**

5.10.2 R­410A Feedback from Manufacturers

**Although some**  **unitary air­conditioning**  **equipment and**  **mini­split systems**  **using**

**R­410A are**  **commercially available,**  **DOE identified**  **only one**  **PTAC and**  **PTHP**

**equipment line**  **by one**  **manufacturer which**  **utilizes R­410A**  **refrigerant on**  **the market**  **as**

**of July**  **2008. Many**  **manufacturers stated**  **their concerns**  **about using**  **R­410A in**  **existing**

**equipment and**  **continuing to**  **meet Federal**  **energy conservation**  **standards or**  **ASHRAE**

**Standard 90.1**  **efficiency levels.**  **A primary**  **concern is**  **the lack**  **of R­410A**  **rotary**

**compressors that**  **work in**  **PTACs and**  **PTHPs.**

**Manufacturers also**  **commented that**  **the refrigerant**  **phaseout would**  **require**

**significant resources**  **to redesign**  **heat exchangers**  **and convert**  **manufacturing plants.** 

**Manufacturers stated**  **that thicker**  **tubing could**  **be needed**  **to address**  **the higher**  **pressures**

**associated with**  **R­410A equipment.**  **The capital**  **investments required**  **for new**  **heat**

**exchanger designs**  **include redesigning**  **the coil**  **shops, retooling,**  **and engineering**  **research**

**and development,**  **which could**  **increase manufacturing**  **costs. All**  **manufacturers**

**interviewed agreed**  **that there**  **will be**  **a need**  **to redesign**  **at least**  **one aspect**  **of their**  **current**

**PTAC and**  **PTHP equipment.** 

**Manufacturers also**  **expressed concern**  **about the**  **potential degradation**  **of PTAC** 

**and PTHP**  **system performance**  **as a**  **result of**  **switching to**  **alternative refrigerants.**  **Some**

**manufacturers expect**  **to see**  **up to**  **a 10­percent**  **degradation in**  **R­410A system** 

**performance. The**  **main reason**  **for the**  **degradation in**  **system performance**  **conveyed by** 

**manufacturers can**  **be attributed**  **to the**  **currently available**  **R­410A rotary**  **compressors**

**applicable to**  **PTACs and**  **PTHPs that**  **are inherently**  **less efficient**  **than R­22**  **rotary**

**compressors.**

5.10.3 R­410A Compressors

**According to**  **manufacturers, there**  **are several**  **key differences**  **between the**  **design**

**and operation**  **of R­22**  **and R­410A**  **compressors for**  **each refrigerant**  **type, regardless**  **of**

**the compressor**  **type (e.g.,**  **scroll, rotary,**  **or screw).**  **Due to**  **the thermodynamic**  **and**

**physical properties**  **of R­410A,**  **the displacement**  **of an**  **R­22 compressor**  **must be**  **reduced**

**by 35**  **percent to**  **40 percent**  **to function**  **with R­410A**  **and provide**  **the same**  **cooling**

**capacity. R­410A**  **compressors must**  **also be**  **designed with**  **thicker and**  **stronger**

**compressor shells**  **and components**  **to withstand**  **50 percent**  **to 60**  **percent more**  **pressure**

**than R­22**  **compressors. 10** 

**Due to**  **HFC chemical**  **characteristics and**  **the immiscibility**  **of mineral**  **oils, R** 

**410A compressors**  **cannot use**  **the mineral**  **oils commonly**  **found in**  **R­22 compressors,.** 

**Therefore, R­410A**  **compressors are**  **designed to**  **use synthetic**  **oils such**  **as polyolester**  **oil**

**(POE). Equipment**  **that uses**  **POE must**  **be handled**  **carefully since**  **POE absorbs**  **moisture**

**much faster**  **than mineral**  **oils. 10**  **Accumulated moisture**  **can lead**  **to early**  **equipment**

**failure.**

**5­39 Only**  **a small**  **percentage of**  **the major**  **manufacturers of**  **R­22 rotary**  **compressors**

**manufacture R­410A**  **rotary compressors**  **suitable for**  **use in**  **PTACs and**  **PTHPs. When** 

**comparing the**  **performance of**  **R­22 and**  **R­410A compressors**  **with 9,000**  **Btu/h cooling** 

**capacity and**  **comparable physical**  **dimensions, compressor**  **EER decreases**  **by about**  **four**

**to six**  **percent. For**  **compressors with**  **12,000 Btu/h**  **cooling capacity**  **and comparable** 

**physical dimensions,**  **the EER**  **decreases by**  **about six**  **to eight**  **percent.**

**Due to**  **the limited**  **availability of**  **R­410A rotary**  **compressors, DOE**  **investigated**

**the scroll**  **compressor industry,**  **which has**  **already experienced**  **a similar**  **refrigerant**

**transition. When**  **comparing the**  **performance of**  **R­22 and**  **R­410A scroll**  **compressors of** 

**comparable cooling**  **capacity and**  **physical dimensions,**  **compressor EER**  **decreases by** 

**about two**  **to six**  **percent. R­410A**  **scroll compressors**  **have been**  **available for**  **several**

**years and**  **are widely**  **used in**  **residential air**  **conditioners. However,**  **even with**  **years of** 

**experience in**  **the phaseout**  **of R­22,**  **manufacturers of**  **residential air**  **conditioner**

**compressors still**  **experience performance**  **degradation with**  **R­410A compressors.** 

5.10.4 AHRI R­410A Study

**AHRI conducted**  **a study**  **of R­410A**  **as part**  **of a**  **response to**  **ACEEE’s ASHRAE** 

**Standard 90.1­1999**  **Continuous Maintenance**  **Proposal on**  **Packaged Terminal** 

**Equipment. 11**  **In the**  **analysis, AHRI**  **concluded that**  **equipment performance**  **of PTACs** 

**and PTHPs**  **would drop**  **(close to**  **8 percent**  **in certain**  **cooling capacity**  **ranges) if**  **R­410A**

**were used**  **as an**  **alternative refrigerant.**  **Table 5.10.1**  **and Table**  **5.10.2 show**  **the estimated** 

**equipment performance**  **degradation for**  **different capacity**  **ranges.**

Table 5.10.1 AHRI Estimated R­410A System EER Degradation for PTACs and

PTHPs 11

Equipment Cooling Capacity System EER Degradation

**< 7,000**  **Btu/h 5.17**  **%**

**≥ 7,000**  **But/h and**  **< 10,000**  **Btu/h 6.32**  **%**

**≥ 10,000**  **Btu/h and**  **< 13,000**  **Btu/h 7.55**  **%**

**≥ 13,000**  **Btu/h 6.32**  **%**

Table 5.10.2 AHRI Estimated R­410A System COP Degradation for PTACs and

PTHPs 11

Equipment Cooling Capacity System COP Degradation

**< 7,000**  **Btu/h 7.00**  **%**

**≥ 7,000**  **But/h and**  **< 10,000**  **Btu/h 7.00**  **%**

**≥ 10,000**  **Btu/h and**  **< 13,000**  **Btu/h 11.16**  **%**

**≥ 13,000**  **Btu/h 8.91**  **%**

**AHRI assessed**  **the performance**  **of prototype**  **models (only**  **those in**  **the cooling** 

**mode) that**  **use R­410A**  **rotary compressors.**  **11 The**  **analysis included**  **computer**

**simulations based**  **on manufacturer**  **equipment performance**  **literature for**  **R­410A rotary** 

**compressors. According**  **to the**  **analysis, if**  **the calculated**  **system performance** 

**degradation were**  **applied to**  **standard and**  **non­standard size**  **PTACs and**  **PTHPs, only**  **a**

**fraction of**  **the current**  **market’s equipment**  **would meet**  **ASHRAE Standard**  **90.1­1999**

**efficiency levels.** 

**5­40**5.10.5 R­410 Confidential Data Submitted by Manufacturers

**DOE received**  **confidential performance**  **test data**  **that characterizes**  **the equipment** 

**performance degradations**  **in standard**  **size PTACs**  **and PTHPs**  **using R­410A**  **refrigerant.**

**DOE received**  **confidential data**  **from two**  **standard size**  **manufacturers and**  **one non** 

**standard size**  **manufacturer. DOE**  **was not**  **able to**  **use the**  **data in**  **its reanalysis**  **because**

**each manufacturer**  **only supplied**  **a minimal**  **number of**  **EER points**  **and their** 

**corresponding cooling**  **capacities of**  **the units**  **tested utilizing**  **R­410A refrigerant.**  **One**

**manufacturer only**  **submitted one**  **point. Manufacturers**  **did not**  **describe the**  **modifications**

**they made**  **to their**  **existing R­22**  **units in**  **order to**  **transform them**  **to R­410A**  **equipment.**

**In addition,**  **it was**  **unclear from**  **the data**  **submitted what**  **additional modifications** 

**manufacturers could**  **make to**  **these units**  **in order**  **to optimize**  **the equipment**  **to use**  **R**

**410A refrigerant.**  **Even though**  **DOE could**  **not use**  **the data**  **to modify**  **the system** 

**performance degradations**  **provided by**  **AHRI, DOE**  **was able**  **to notice**  **some general** 

**trends from**  **the data,**  **which can**  **also be**  **seen from**  **the degraded**  **market data**  **(see section** 

**5.10.7). DOE**  **found that**  **the system**  **performance degradations**  **for PTAC**  **and PTHP** 

**equipment with**  **R­410A, as**  **described by**  **the AHRI**  **study and**  **used in**  **the NOPR,**  **were in** 

**the middle**  **of the**  **range of**  **the submitted**  **data. The**  **confidential data**  **DOE received**  **also**

**suggests that**  **the performance**  **degradation can**  **vary greatly**  **depending upon**  **the cooling** 

**capacity of**  **the equipment.**  **Manufacturers typically**  **increase the**  **surface area**  **or add**  **a**

**row to**  **the heat**  **exchanger in**  **order to**  **increase unit**  **capacity. Even**  **at larger**  **cooling**

**capacities, manufacturers**  **have to**  **maintain the**  **same physical**  **box sleeve,**  **leaving little** 

**space for**  **additional efficiency**  **modifications (e.g.,**  **adding heat**  **exchanger area).** 

**Therefore, DOE**  **further considered**  **the effects**  **of the**  **R­410A refrigerant**  **phaseout on**  **the**

**entire range**  **of cooling**  **capacities as**  **part of**  **the generation**  **of the**  **energy­efficiency**

**equations that**  **translates the**  **results for**  **the representative**  **cooling capacities**  **to the**  **entire**

**cooling capacity**  **range. See**  **Chapter 9**  **of the**  **TSD.**

5.10.6 R­410A Analysis Methodology

**In order**  **to analyze**  **the impact**  **of using**  **R­410A in**  **PTACs and**  **PTHPs, DOE** 

**considered the**  **impact of**  **using R­410A**  **on PTAC**  **component, past**  **rulemaking**

**experience, and**  **markets in**  **which a**  **similar transition**  **occurred.**

**First, DOE**  **expects that**  **the phase­out**  **of R­22**  **and the**  **subsequent adoption**  **of R** 

**410A refrigerants**  **in PTACs**  **and PTHPs**  **will require**  **the redesign**  **of the**  **sealed systems** 

**found inside**  **the PTAC**  **and PTHP**  **units. The**  **sealed system**  **consists of**  **the indoor**  **and**

**outdoor heat**  **exchangers, the**  **compressor, refrigerant**  **flow­control devices,**  **and any** 

**piping that**  **connects these**  **components through**  **which refrigerant**  **flows during**  **unit**

**5­41 operation.**  **Since R­22**  **refrigerants have**  **different operating**  **characteristics than**  **R­410A,**

**the sealed**  **system in**  **a PTAC**  **or PTHP**  **unit using**  **R­410A will**  **have to**  **be redesigned**  **to**

**optimize the**  **unit for**  **operation with**  **R­410A. Specifically,**  **equipment using**  **R­410A**

**operates at**  **higher system**  **pressure requiring**  **stronger sealed**  **system walls**  **and the**  **use of** 

**different oils**  **(i.e., R­410**  **equipment will**  **use POE,**  **while R­22**  **equipment uses**  **mineral).**

**In addition,**  **R­410A compressors**  **must also**  **be designed**  **with thicker**  **and stronger** 

**compressor shells**  **and components**  **to withstand**  **50 percent**  **to 60**  **percent more**  **pressure**

**than R­22**  **compressors. j** 

**The loss**  **in compressor**  **efficiency can**  **be overcome**  **with optimized**  **heat**

**exchanger design**  **to a**  **limited extent.**  **As discussed**  **in the**  **market and**  **technology**

**assessment (Chapter**  **3 of**  **the TSD),**  **different heat**  **exchanger redesigns**  **not currently** 

**associated with**  **compressors could**  **increase overall**  **system performance.**  **According to** 

**manufacturers, some**  **redesigns, such**  **as adding**  **coils, re­circuiting,**  **and increasing**  **the**

**frontal heat**  **exchanger surface**  **area, are**  **applicable to**  **PTACs and**  **PTHPs regardless**  **of the** 

**refrigerant used.**  **However, DOE**  **does not**  **have sufficient**  **information to**  **predict with** 

**precision the**  **performance benefits**  **of heat**  **exchanger redesigns.**  **Initially, DOE**  **expects**

**any such**  **redesigns to**  **result in**  **efficiency improvement**  **insufficient to**  **offset the**  **efficiency**

**reductions resulting**  **from the**  **switch from**  **R­22 to**  **R­410A. Thus,**  **DOE expects**  **the**

**overall system**  **efficiency of**  **R­410A PTAC**  **and PTHP**  **equipment will**  **be lower**  **than if** 

**that equipment**  **used R­22,**  **as predicted**  **by manufacturer**  **testing, AHRI’s**  **research, k** 

**National Institute**  **of Standards**  **and Technology**  **studies, l**  **and prior**  **experience in**  **the**

**residential air**  **conditioning market.**  **Optimizing the**  **heat exchanger**  **and HVAC**  **circuits to** 

**compensate could**  **be costly,**  **depending on**  **whether a**  **heat exchanger**  **manufacturer needs** 

**to change**  **the fin**  **tooling, expansion,**  **and assembly**  **systems.**

**Therfore, DOE**  **is using**  **an overall**  **lower system**  **performance for**  **PTAC and** 

**PTHP equipment**  **with R­410A.**  **For standard**  **size PTACs**  **and PTHPs**  **with 9,000**  **Btu/h**

**cooling capacity,**  **DOE calculated**  **an overall**  **system performance**  **degradation consistent** 

**with AHRI**  **estimates of**  **6.3 percent.**  **For standard**  **size PTACs**  **and PTHPs**  **with 12,000** 

**Btu/h cooling**  **capacity, DOE**  **calculated overall**  **system performance**  **degradation**

**consistent with**  **AHRI estimates**  **of 7.6**  **percent. For**  **non­standard size**  **PTACs and**  **PTHPs**

**j Emerson**  **Climate Technologies.**  **R410A Questions.** 

**http://www.emersonclimate.com/faq_copeland.htm#R410A (Last**  **accessed August**  **2, 2007.)** 

**k Air­Conditioning**  **and Refrigeration**  **Institute.** Response to ASHRAE 90.1 Continuous Maintenance

Proposal on Package Terminal Equipment

**. May**  **18, 2006.** 

**l Payne,**  **W., Domanski,**  **P.** A Comparison of an R22 and an R410A Air Conditioner Operating at High

Ambient Temperatures. **National Institute**  **of Standards**  **and Technology**  **Building Environment**  **Division:**

**Thermal Machinery**  **Group. http://www.fire.nist.gov/bfrlpubs/build02/PDF/b02186.pdf.**  **(Last accessed** 

**July 14,**  **2008.)**

**5­42 of**  **all cooling**  **capacities, DOE**  **calculated overall**  **system performance**  **degradation of**  **6.8**

**percent.**

5.10.7 R­410A Equipment Performance

**DOE applied**  **the system**  **performance degradations**  **calculated by**  **AHRI’s R­410A** 

**analysis to**  **the standard**  **size PTAC**  **and PTHP**  **equipment listed**  **in the**  **2008 AHRI** 

**Certified Directory**  **of Equipment.** 

7.5 8.5 9.5 10.5 11.5 12.5EER

6,500 8,500 10,500 12,500 14,500

Cooling Capacity, Btu/h

ASHRAE 90.1­1999

R­22 Performance Data (AHRI Directory)

R­410A Estimated Performance Data (Engineering Analysis)

Figure 5.10.1 Equipment Performance of Standard Size PTACs Utilizing R­22 and

R­410A Refrigerant ­ 2008 AHRI Directory and Engineering Analysis

Performance Degradations

**5­43**6,500 8,500 10,500 12,500 14,500

Cooling Capacity, Btu/h

ASHRAE 90.1­1999

R­22 Performance Data (AHRI Directory)

R­410A Estimated Performance Data (Engineering Analysis) 8.5 9.0 9.5 10.0 10.5 11.0 11.5 12.0 12.5 13.0 13.5EER

Figure 5.10.2 Equipment Performance of Standard Size PTHPs Utilizing R­22 and

R­410A Refrigerant ­ 2008 AHRI Directory and Engineering Analysis

Performance Degradations

**DOE applied**  **the system**  **performance degradations**  **to the**  **non­standard size**  **PTAC**

**and PTHP**  **equipment identified**  **by DOE**  **through review**  **of publicly**  **available product** 

**catalogs and**  **manufacturer literature.** 

**5­44**6,500 8,500 10,500 12,500 14,500

Cooling Capacity, Btu/h

ASHRAE 90.1­1999

R­22 Performance Data (Manufacturer Catalogs)

R­410A Estimated Performance Data (Engineering Analysis) 7.0 8.0 9.0 10.0 11.0 12.0 13.0EER

Figure 5.10.3 Equipment Performance of Non­Standard Size PTACs Utilizing R­22

and R­410A Refrigerant

– Manufacturers’ Catalogs and Engineering

Analysis Performance Degradations

**5­45**EER

8.0 9.0 10.0 11.0 12.0

7.0

6,500 8,500 10,500 12,500 14,500

Cooling Capacity, Btu/h

ASHRAE 90.1­1999

R­22 Performance Data (Manufacturer Catalogs)

R­410A Estimated Performance Data (Engineering Analysis

Figure 5.10.4 Equipment Performance of Non­Standard Size PTHPs Utilizing R­22

and R­410A Refrigerant

– Manufacturers’ Catalogs and Engineering

Analysis Performance Degradations

5.10.8 R­410A Max Tech Efficiency Levels

**DOE has**  **determined the**  **maximum improvement**  **in energy**  **efficiency that**  **is**

**technologically feasible**  **(“max tech”)**  **for PTACs**  **and PTHPs**  **utilizing R­22.**  **To calculate** 

**the max**  **tech efficiency**  **levels utilizing**  **R­410A, DOE**  **applied the**  **system performance** 

**degradations estimated**  **in the**  **Engineering Analysis**  **to the**  **representative cooling** 

**capacities within**  **a given**  **equipment class.**  **Table 5.9.3**  **lists the**  **“max tech”**  **levels for** 

**equipment utilizing**  **R­419A that**  **DOE determined**  **for this**  **rulemaking.**

**5­46**Table 5.10.3 **“** Max Tech” Efficiency Levels utilizing R­410A (≥7,000 Btu/h and

≤15,000 Btu/h Equipment Classes)

Equipment

Type Equipment Class Cooling

Capacity “Max Tech”

Efficiency Level*

**Standard Size**  ****** **9,000 Btu/h**  **11.5 EER** 

**PTAC**

**12,000 Btu/h**  **10.8 EER** 

**Non­standard Size**  † **11,000 Btu/h**  **10.0 EER** 

**Standard Size**  ****** **9,000 Btu/h**  **11.5 EER** 

**3.3 COP** 

**PTHP 12,000**  **Btu/h 10.8**  **EER**

**3.1 COP** 

**Non­standard Size**  † **11,000 Btu/h**  **10.0 EER** 

**2.9 COP** 

***** **For equipment**  **rated according**  **to the**  **DOE test**  **procedure, all**  **EER values**  **would be**  **rated at**  **95oF outdoor** 

**dry­bulb temperature**  **for air­cooled**  **equipment and**  **evaporatively­cooled equipment**  **and at**  **85oF entering** 

**water temperature**  **for water**  **cooled equipment.**  **All COP**  **values must**  **be rated**  **at 47oF**  **outdoor dry­bulb** 

**temperature for**  **air­cooled equipment,**  **and at**  **70oF entering**  **water temperature**  **for water­source**  **heat pumps.** 

****** **Standard size**  **refers to**  **PTAC or**  **PTHP equipment**  **with wall**  **sleeve dimensions**  **having an**  **external wall** 

**opening of**  **greater than**  **or equal**  **to 16**  **inches high**  **or greater**  **than or**  **equal to**  **42 inches**  **wide, and**  **having a** 

**cross­sectional area**  **greater than**  **or equal**  **to 670**  **inches squared.** 

**† Non­standard**  **size refers**  **to PTAC**  **or PTHP**  **equipment with**  **existing wall**  **sleeve dimensions**  **have an** 

**external wall**  **opening of**  **less than**  **16 inches**  **high or**  **less than**  **42 inches**  **wide, and**  **having a**  **cross­sectional**

**area less**  **than 670**  **inches squared.** 

5.10.9 R­410A Analysis

**DOE made**  **several estimations**  **about the**  **simulated R­410A**  **equipment**

**performance and**  **associated costs.**  **DOE based**  **each estimation**  **on detailed**  **discussions**

**with manufacturers,**  **technical journal**  **reports, AHRI’s**  **R­410A analysis,**  **and engineering** 

**calculations for**  **this rulemaking.** 

**DOE used**  **the same**  **overall system**  **performance degradation**  **provided by**  **AHRI**

**from its**  **R­410A study**  **on PTAC**  **and PTHP**  **equipment. For**  **standard size**  **PTACs and** 

**PTHPs with**  **9,000 Btu/h**  **cooling capacity,**  **DOE calculated**  **an overall**  **system**

**performance degradation**  **consistent with**  **AHRI estimates**  **of 6.3**  **percent. For**  **standard**

**size PTACs**  **and PTHPs**  **with 12,000**  **Btu/h cooling**  **capacity, DOE**  **calculated overall** 

**system performance**  **degradation consistent**  **with AHRI**  **estimates of**  **7.6 percent.**  **For non** 

**standard size**  **PTACs and**  **PTHPs of**  **all cooling**  **capacities, DOE**  **calculated overall**  **system**

**performance degradation**  **of 6.8**  **percent.**

**DOE has**  **no evidence**  **that the**  **incremental efficiency**  **gains from**  **the design** 

**options used**  **in the**  **R­22 case**  **would have**  **a different**  **effect on**  **the system**  **performance of** 

**5­47 R­410A**  **equipment. Therefore,**  **DOE assumed**  **the design**  **options for**  **the R­22**  **analysis**

**previously discussed**  **are applicable**  **to the**  **alternative refrigerant**  **analysis. DOE**  **also**

**assumed that**  **the corresponding**  **incremental EER**  **improvement for**  **each design**  **option in** 

**the R­22**  **analysis would**  **be the**  **same in**  **the alternative**  **refrigerant analysis.** 

**To derive**  **the baseline**  **MPCs for**  **the R­410A**  **PTACs and**  **PTHPs, DOE**  **revised**

**the cost**  **model used**  **for the**  **R­22 engineering**  **analysis. DOE**  **assumed a**  **25 percent** 

**increase in**  **heat exchanger**  **tubing thickness**  **to account**  **for the**  **higher pressures**  **of R** 

**410A. The**  **working refrigerant**  **in the**  **cost model**  **was switched**  **to R­410A**  **for which** 

**DOE used**  **current R­410A**  **refrigerant prices.**  **Several manufacturers**  **stated that** 

**compressor prices**  **would increase**  **between 10**  **percent and**  **20 percent**  **from current**  **R­22**

**rotary compressor**  **prices. Subsequently,**  **DOE estimated**  **that R­410A­capable** 

**compressor costs**  **would be**  **15 percent**  **higher than**  **comparable R­22**  **units. Using**  **the**

**above assumptions,**  **DOE recalculated**  **baseline equipment**  **and design**  **option MPCs**  **to**

**establish the**  **cost­efficiency relationship**  **for R­410A**  **equipment.**

**The physical**  **differences between**  **PTACs and**  **PTHP are**  **mainly in**  **the reversing** 

**valve and**  **other minor**  **components. The**  **results from**  **the engineering**  **analysis showed** 

**that the**  **sum of**  **the MPCs**  **for reversing**  **valves and**  **other minor**  **components are**  **constant**

**across the**  **cost­efficiency relationship**  **for the**  **R­22 case.**  **Therefore, the**  **cost­efficiency**

**relationship (i.e.,**  **cost­efficiency curves)**  **of PTACs**  **is the**  **same as**  **the cost­efficiency** 

**relationship of**  **PTHPs, minus**  **the MPCs**  **for the**  **reversing valve**  **and other**  **minor**

**components at**  **various cooling**  **capacities. For**  **the alternative**  **refrigerant analysis,**  **DOE**

**assumed that**  **incremental cumulative**  **MPCs for**  **PTACs and**  **PTHPs of**  **the same** 

**equipment class**  **would be**  **the same**  **as in**  **the R­22**  **case (i.e.,**  **both PTACs**  **and PTHPs** 

**have the**  **same incremental**  **cost­efficiency curves**  **in the**  **R­410A case).** 

**To be**  **consistent, DOE**  **used the**  **same cost**  **model for**  **the R­22**  **analysis to**  **estimate**

**MPCs for**  **different efficiency**  **levels in**  **the R­410A**  **analysis.**

5.10.10R­410A Cost­Efficiency Curves

**Figure 5.10.5**  **through Figure**  **5.10.10 present**  **the results**  **of this**  **alternative**

**refrigerant analysis**  **using R­410A**  **(solid lines)**  **and the**  **results from**  **the R­22**  **analysis**

**(dashed lines).** 

**5­48**8 8.5 9 9.5 10 10.5 11 11.5

System EER $300 $325 $350 $375 $400 $425 $450 $475 $500 $525 $550 $575 $600 $625 $650ManufacturerProductionCost(MPC)

MPC = 3 .60 (EER ) 2

­ 51.34 (EER ) + 534.76

Standard Size PTAC 9,000 Btu/h ­ 5­Year Average Material Price R­410A Refrigerant

Standard Size PTAC 9,000 Btu/h ­ 5­Year Average Material Price R­22 Refrigerant

Figure 5.10.5 Manufacturer Production Cost (2007$) versus Efficiency for R­410A

Standard Size PTACs with a Cooling Capacity of 9,000 Btu/h

**5­49** 128 8.5 9 9.5 10 10.5 11 11.5

System EER $300 $325 $350 $375 $400 $425 $450 $475 $500 $525 $550 $575 $600 $625 $650ManufacturerProductionCost(MPC)

MPC = 3.60 (EER) 2

­ 51.34 (EER) + 584.76

Standard Size PTHP 9,000 Btu/h ­ 5­Year Average Material Price R­410A Refrigerant

Standard Size PTHP 9,000 Btu/h ­ 5­Year Average Material Price R­22 Refrigerant

Figure 5.10.6 Manufacturer Production Cost (2007$) versus Efficiency for R­410A

Standard Size PTHPs with a Cooling Capacity of 9,000 Btu/h

**5­50** 128 8.5 9 9.5 10 10.5 11 11.5

System EER $300 $325 $350 $375 $400 $425 $450 $475 $500 $525 $550 $575 $600 $625 $650ManufacturerProductionCost(MPC)

MPC = 6.01 (EER) 2

­ 88.08 (EER) + 754.53

Standard Size PTAC 12,000 Btu/h ­ 5­Year Average Material Price R­410A Refrigerant

Standard Size PTAC 12,000 Btu/h ­ 5­Year Average Material Price R­22 Refrigerant

Figure 5.10.7 Manufacturer Production Cost (2007$) versus Efficiency for R­410A

Standard Size PTACs with a Cooling Capacity of 12,000 Btu/h

**5­51** 128 8.5 9 9.5 10 10.5 11 11.5

System EER $300 $325 $350 $375 $400 $425 $450 $475 $500 $525 $550 $575 $600 $625 $650ManufacturerProductionCost(MPC)

MPC = 6.01 (EER) 2

­ 88.08 (EER) + 804.53

Standard Size PTHP 12,000 Btu/h ­ 5­Year Average Material Price R­410A Refrigerant

Standard Size PTHP 12,000 Btu/h ­ 5­Year Average Material Price R­22 Refrigerant

Figure 5.10.8 Manufacturer Production Cost (2007$) versus Efficiency for R­410A

Standard Size PTHPs with a Cooling Capacity of 12,000 Btu/h

**5­52** 128 8.5 9 9.5 10 10.5 11 11.5

System EER $300 $325 $350 $375 $400 $425 $450 $475 $500 $525 $550 $575 $600 $625 $650ManufacturerProductionCost(MPC) MPC = 6.46 (EER) 2

­ 98.83 (EER) + 898.46

Non­Standard Size PTAC 11,000 Btu/h ­ 5­Year Average Material Price R­410A Refrigerant

Non­Standard Size PTAC 11,000 Btu/h ­ 5­Year Average Material Price R­22 Refrigerant

Figure 5.10.9 Manufacturer Production Cost (2007$) versus Efficiency for R­410A

Non­Standard Size PTACs with a Cooling Capacity of 11,000 Btu/h

**5­53** 12ManufacturerProductionCost(MPC) $650

$625

$600

$575

$550

$525

$500

$475

$450

$425

$400

$375

$350

$325

$300 MPC = 6.46 (EER) 2

­ 98.83 (EER) + 948.46

8 8.5 9 9.5 10 10.5 11 11.5

System EER

Non­Standard Size PTHP 11,000 Btu/h ­ 5­Year Average Material Price R­410A Refrigerant

Non­Standard Size PTHP 11,000 Btu/h ­ 5­Year Average Material Price R­22 Refrigerant

Figure 5.10.10 Manufacturer Production Cost (2007$) versus Efficiency for R­410A

Non­Standard Size PTHPs with a Cooling Capacity of 11,000 Btu/h

**The results**  **for standard**  **size PTACs**  **and PTHPs**  **with 12,000**  **Btu/h cooling** 

**capacity show**  **that as**  **the system**  **EER increases,**  **the incremental**  **MPC increases**  **more**

**rapidly than**  **with standard**  **size equipment**  **with 9,000**  **Btu/h cooling**  **capacity (i.e.,**  **the**

**cost­efficiency curve**  **slope is**  **greater in**  **the 12,000**  **Btu/h cooling**  **capacity case).** 

**In addition,**  **the standard**  **size PTACs**  **and PTHPs**  **with 12,000**  **Btu/h cooling** 

**capacity have**  **a greater**  **degradation of**  **system EER**  **than standard**  **size PTACs**  **and PTHPs** 

**with 9,000**  **Btu/h cooling**  **capacity. PTACs**  **and PTHPs**  **with R­22**  **as a**  **refrigerant follow** 

**the same**  **pattern in**  **efficiency.**

**For the**  **R­22 case,**  **9,000 Btu/h**  **cooling capacity**  **rotary compressors**  **are more** 

**efficient than**  **12,000 Btu/h**  **cooling capacity.**  **DOE has**  **no evidence**  **that the**  **same would** 

**not hold**  **true for**  **the R­410A**  **case.**

**Due to**  **the increase**  **in cooling**  **capacity between**  **9,000 Btu/h**  **and 12,000**  **Btu/h,**

**heat exchangers**  **are modified**  **(i.e., circuits**  **may be**  **added or**  **width of**  **fins increased),** 

**which would**  **make it**  **more difficult**  **to increase**  **surface area**  **of the**  **coils inside**  **the**

**constrained volume.**  **Therefore, increasing**  **the efficiency**  **of standard**  **size equipment**  **with**

**12,000 Btu/h**  **cooling capacity**  **is more**  **difficult and**  **more costly**  **than increasing**  **the**

**efficiency of**  **standard size**  **equipment with**  **9,000 Btu/h**  **cooling capacity.**  **To reduce** 

**costs, manufacturers**  **will likely**  **keep the**  **efficiency of**  **standard size**  **equipment with** 

**12,000 Btu/h**  **cooling capacity**  **to the**  **Federal minimum.**  **Manufacturers that**  **cannot**

**5­54** 12**achieve even**  **the Federal**  **minimum efficiency**  **for the**  **12,000 Btu/h**  **cooling capacity**  **range**

**would be**  **forced to**  **discontinue offering**  **equipment with**  **that cooling**  **capacity.**

**For the**  **non­standard size**  **equipment, the**  **results also**  **show a**  **steeper increase**  **in**

**incremental MSP**  **as the**  **system EER**  **increases. In**  **general, non­standard**  **size PTACs**  **and**

**PTHPs have**  **lower system**  **EERs than**  **standard size**  **PTACs and**  **PTHPs of**  **the same** 

**cooling capacity**  **range because**  **smaller wall**  **sleeve sizes**  **constrain the**  **size of**  **the heat** 

**exchangers.**

**DOE also**  **expects that**  **the refrigerant**  **changeover to**  **R­410A will**  **economically**

**affect non­standard**  **size equipment**  **more than**  **standard size**  **equipment. To**  **allow such**  **a**

**changeover, all**  **PTACs and**  **PTHPs coils**  **must be**  **redesigned, requiring**  **significant**

**research and**  **development. Non­standard**  **size equipment**  **coils require**  **a similar**  **effort as** 

**standard size**  **equipment ones,**  **but the**  **shipment volumes**  **that the**  **conversion costs**  **are**

**spread over**  **are much**  **lower for**  **non­standard coils.** 

**If the**  **manufacturer makes**  **the coils**  **in­house, a**  **further capital**  **charge will**  **be**

**incurred to**  **convert the**  **manufacturing facility.**  **If coil**  **manufacturing is**  **outsourced, such** 

**conversion costs**  **are also**  **typically borne**  **by the**  **buyer (either**  **explicitly or**  **by rolling**  **them**

**into the**  **purchase price).**  **The magnitude**  **of such**  **expenses usually**  **depends on**  **whether**

**the vendor**  **already makes**  **similar coils.** 

5.11 HEAT PUMP EER TO HEAT PUMP COP

**DOE used**  **the analysis**  **detailed in**  **the sections**  **above to**  **determine the**  **cost**

**efficiency relationship**  **for cooling**  **EER for**  **PTACs and**  **PTHPs. DOE**  **also performed**  **an**

**analysis to**  **determine the**  **heating efficiency**  **(COP) that**  **correspond to**  **the cooling** 

**efficiency (EER)**  **analyzed.**

**DOE recognizes**  **that this**  **is a**  **limited analysis;**  **however, it**  **believes that**  **it is** 

**sufficient and**  **reveals the**  **relationship between**  **the cooling**  **and heating**  **efficiency metric.** 

**DOE reviewed**  **the 2008**  **AHRI directory**  **and surveyed**  **all the**  **PTHP units**  **listed for**  **2008.**

**There were**  **687 units**  **listed, which**  **DOE separated**  **into two**  **groups based**  **on wall**  **sleeve**

**size (standard**  **size and**  **non­standard size).**  **DOE then**  **selected all**  **the standard**  **size 9,000** 

**and 12,000**  **Btu/h cooling**  **capacity units**  **and further**  **eliminated duplicate**  **and/or**

**discontinued units.**  **DOE constructed**  **a listing**  **of the**  **standard size**  **units including**  **their**

**corresponding EER**  **level and**  **ranked them**  **by COP**  **level. For**  **non­standard size**  **units,**

**DOE selected**  **all capacities**  **and further**  **eliminated repetitive**  **and discontinued**  **units.**

**DOE also**  **constructed a**  **listing of**  **the non­standard**  **size units**  **including their** 

**corresponding EER**  **level and**  **ranked them**  **by COP**  **level. DOE**  **graphed each**  **listing**

**(EER versus**  **COP) and**  **calculated the**  **minimum, maximum,**  **and average**  **COPs. Figure** 

**5.11.1 through**  **Figure 5.11.3**  **show the**  **results.**

**5­55**COP = 0.2946(EER) ­ 0.0616

2.0 2.2 2.4 2.6 2.8 3.0 3.2 3.4 3.6 3.8COP

7.5 8.0 8.5 9.0 9.5 10.0 10.5 11.0 11.5 12.0 12.5

EER

COP vs EER (Standard Size PTHP 9,000 Btu/h cooling capacity)

Figure 5.11.1 COP versus EER for Standard Size PTHPs with 9,000 Btu/h Cooling

Capacity from 2008 AHRI directoryCOP 3.8

3.6

3.4

3.2

3.0

2.8

2.6

2.4

2.2

2.0 COP = 0.1611(EER) + 1.4

7.5 8.5 9.5 10.5 11.5 12.5

EER

COP vs EER (Standard Size PTHP 12,000 Btu/h cooling capacity)

Figure 5.11.2 COP versus EER for Standard Size PTHPs with 12,000 Btu/h Cooling

Capacity from 2008 AHRI directory

**5­56**COP 3.8

3.6

3.4

3.2

3

2.8

2.6

2.4

2.2

2 COP = 0.0403(EER) + 2.447

7.5 8.5 9.5 10.5 11.5 12.5

EER

COP vs EER (Non­Standard Size PTHP All cooling capacities)

Figure 5.11.3 COP versus EER for Non­Standard Size PTHPs All Cooling Capacity

from 2008 AHRI directory

**An upward**  **trend is**  **observed from**  **all of**  **the graphs**  **by examining**  **the different** 

**COP points.**  **These trends**  **reveal a**  **steady increase**  **in COP**  **with increased**  **EER. DOE** 

**associated the**  **EER levels**  **of each**  **cooling capacity**  **rage with**  **the COP**  **levels using**  **a**

**linear regression**  **fit, as**  **shown in**  **the graphs.**  **The regression**  **line attempts**  **to quantify**  **the**

**relationship between**  **cooling EER**  **and heating**  **COP. This**  **enabled DOE**  **to determine**  **a**

**comparable COP**  **level for**  **every air­conditioning**  **efficiency level**  **that it**  **further**

**investigated.**

5.12 SENSITIVITY ANALYSES

**DOE conducted**  **a sensitivity**  **analysis on**  **material prices**  **to examine**  **the effect**  **of**

**spikes in**  **metal prices**  **that the**  **industry has**  **experienced over**  **the past**  **few years.**  **The**

**sensitivity analysis**  **used the**  **annual average**  **2008 prices**  **for various**  **metals used**  **in the** 

**manufacturing of**  **PTACs and**  **PTHPs, shown**  **on Table**  **5.12.1.**

**5­57**Table 5.12.1 Annual Average 2008 Metal Prices

Metals Cost ($/lb)

(2007$)

**Plain Cold**  **Rolled Steel**  **(CRS) $0.42** 

**Painted CRS**  **$0.66**

**Galvanized CRS**  **$0.55**

**Fin Aluminum**  **$1.72**

**Plain Copper**  **$3.47**

**Copper Tube** 

**– Plain**  **$4.10**

**Copper Tube** 

**– Rifled**  **$4.30**

**DOE conducted**  **the sensitivity**  **analysis for**  **PTACs and**  **PTHPs utilizing**  **both R­22** 

**and R­410A**  **refrigerant. Figure**  **5.12.1 through**  **Figure 5.12.12**  **present the**  **results of**  **this**

**sensitivity analysis**  **in 2007$.**  **All graphs**  **including the**  **5­year average**  **material prices** 

**(dashed lines)**  **and the**  **2008 annual**  **average material**  **prices (solid**  **lines).**

**5­58**$375 $400 $425 $450 $475 $500 $525 $550 $575 $600 $625 $650 $675 $700ManufacturingCost

MPC = 3.34(EER) 2

– 42. 60(EER) + 498.23

8 8.5 9 9.5 10 10.5 11 11.5 12 12.5

EER

Standard Size PTAC 9,000 Btu/h ­ Current Material Price R­410A Refrigerant

Standard Size PTAC 9,000 Btu/h ­ 5 Year Average Material Price R­410A Refrigerant

Figure 5.12.1 Material Price Sensitivity for Standard Size PTACs with a Cooling

Capacity of 9,000 Btu/h and R­410A Refrigerant

**5­59**$325 $350 $375 $400 $425 $450 $475 $500 $525 $550 $575 $600ManufacturingCost

MPC = 2.98 (EER) 2

– 42.99 (EER) + 481.03

8 8.5 9 9.5 10 10.5 11 11.5 12 12.5

EER

Standard Size PTAC 9,000 Btu/h ­ Current Material Price R­22 Refrigerant

Standard Size PTAC 9,000 Btu/h ­ 5 Year Average Material Price R­22 Refrigerant

Figure 5.12.2 Material Price Sensitivity for Standard Size PTACs with a Cooling

Capacity of 9,000 Btu/h and R­22 Refrigerant

**5­60**$375 $400 $425 $450 $475 $500 $525 $550 $575 $600 $625 $650 $675 $700ManufacturingCost

MPC = 3.34(EER) 2

– 42. 60(EER) + 54 8.23

8 8.5 9 9.5 10 10.5 11 11.5 12 12.5

EER

Standard Size PTHP 9,000 Btu/h ­ Current Material Price R­410A Refrigerant

Standard Size PTHP 9,000 Btu/h ­ 5 Year Average Material Price R­410A Refrigerant

Figure 5.12.3 Material Price Sensitivity for Standard Size PTHPs with a Cooling

Capacity of 9,000 Btu/h and R­410A Refrigerant

**5­61**$325 $350 $375 $400 $425 $450 $475 $500 $525 $550 $575 $600ManufacturingCost

MPC = 2.98 (EER) 2

– 42.99 (EER) + 53 1.0 3

8 8.5 9 9.5 10 10.5 11 11.5 12 12.5

EER

Standard Size PTHP 9,000 Btu/h ­ Current Material Price R­22 Refrigerant

Standard Size PTHP 9,000 Btu/h ­ 5 Year Average Material Price R­22 Refrigerant

Figure 5.12.4 Material Price Sensitivity for Standard Size PTHPs with a Cooling

Capacity of 9,000 Btu/h and R­22 Refrigerant

**5­62**$375 $400 $425 $450 $475 $500 $525 $550 $575 $600 $625 $650 $675 $700ManufacturingCost

MPC = 3.79 (EER) 2

– 39.77 (EER) + 535.93

8 8.5 9 9.5 10 10.5 11 11.5 12 12.5

EER

Standard Size PTAC 12,000 Btu/h ­ Current Material Price R­410A Refrigerant

Standard Size PTAC 12,000 Btu/h ­ 5 Year Average Material Price R­410A Refrigerant

Figure 5.12.5 Material Price Sensitivity for Standard Size PTACs with a Cooling

Capacity of 12,000 Btu/h and R­410A Refrigerant

**5­63**$325 $350 $375 $400 $425 $450 $475 $500 $525 $550 $575 $600ManufacturingCost

MPC = 3.70 (EER) 2

– 46. 89 (EER) + 520.49

8 8.5 9 9.5 10 10.5 11 11.5 12 12.5

EER

Standard Size PTAC 12,000 Btu/h ­ Current Material Price R­22 Refrigerant

Standard Size PTAC 12,000 Btu/h ­ 5 Year Average Material Price R­22 Refrigerant

Figure 5.12.6 Material Price Sensitivity for Standard Size PTACs with a Cooling

Capacity of 12,000 Btu/h and R­22 Refrigerant

**5­64**$375 $400 $425 $450 $475 $500 $525 $550 $575 $600 $625 $650 $675 $700ManufacturingCost MPC = 3.79 (EER) 2

– 39.77 (EER) + 5 8 5.93

8 8.5 9 9.5 10 10.5 11 11.5 12 12.5

EER

Standard Size PTHP 12,000 Btu/h ­ Current Material Price R­410A Refrigerant

Standard Size PTHP 12,000 Btu/h ­ 5 Year Average Material Price R­410A Refrigerant

Figure 5.12.7 Material Price Sensitivity for Standard Size PTHPs with a Cooling

Capacity of 12,000 Btu/h and R­410A Refrigerant

**5­65**$325 $350 $375 $400 $425 $450 $475 $500 $525 $550 $575 $600ManufacturingCost MPC = 3.70 (EER) 2

– 46. 8 9 (EER) + 5 7 0.49

8 8.5 9 9.5 10 10.5 11 11.5 12 12.5

EER

Standard Size PTHP 12,000 Btu/h ­ Current Material Price R­22 Refrigerant

Standard Size PTHP 12,000 Btu/h ­ 5 Year Average Material Price R­22 Refrigerant

Figure 5.12.8 Material Price Sensitivity for Standard Size PTHPs with a Cooling

Capacity of 12,000 Btu/h and R­22 Refrigerant

**5­66**$375 $400 $425 $450 $475 $500 $525 $550 $575 $600 $625 $650 $675 $700ManufacturingCost MPC = 7.02 (EER) 2

– 107.09(EER) + 950.45

8 8.5 9 9.5 10 10.5 11 11.5 12 12.5

EER

Non­Standard Size PTAC 11,000 Btu/h ­ Current Material Price R­410A Refrigerant

Non­Standard Size PTAC 11,000 Btu/h ­ 5 Year Average Material Price R­410A Refrigerant

Figure 5.12.9 Material Price Sensitivity for Non­Standard Size PTACs with a

Cooling Capacity of 11,000 Btu/h and R­410A Refrigerant

**5­67**$325 $350 $375 $400 $425 $450 $475 $500 $525 $550 $575 $600ManufacturingCost MPC = 6.18 (EER) 2

– 101. 78 (EER) + 896.82

8 8.5 9 9.5 10 10.5 11 11.5 12 12.5

EER

Non­Standard Size PTAC 11,000 Btu/h ­ 5 Year Average Material Price R­22 Refrigerant

Non­Standard Size PTAC 11,000 Btu/h ­ Current Material Price R­22 Refrigerant

Figure 5.12.10 Material Price Sensitivity for Non­Standard Size PTACs with a

Cooling Capacity of 11,000 Btu/h and R­22 Refrigerant

**5­68**$375 $400 $425 $450 $475 $500 $525 $550 $575 $600 $625 $650 $675 $700ManufacturingCost MPC = 7.02 (EER) 2

– 107.09(EER) + 100 0.45

8 8.5 9 9.5 10 10.5 11 11.5 12 12.5

EER

Non­Standard Size PTHP 11,000 Btu/h ­ Current Material Price R­410A Refrigerant

Non­Standard Size PTAC 11,000 Btu/h ­ 5 Year Average Material Price R­410A Refrigerant

Figure 5.12.11 Material Price Sensitivity for Non­Standard Size PTHPs with a

Cooling Capacity of 11,000 Btu/h and R­410A Refrigerant

**5­69**$325 $350 $375 $400 $425 $450 $475 $500 $525 $550 $575 $600 $625ManufacturingCost MPC = 6.18 (EER) 2

– 101. 78 (EER) + 946.82

8 8.5 9 9.5 10 10.5 11 11.5 12 12.5

EER

Non­Standard Size PTHP 11,000 Btu/h ­ Current Material Price R­22 Refrigerant

Non­Standard Size PTHP 11,000 Btu/h ­ 5 Year Average Material Price R­22 Refrigerant

Figure 5.12.12 Material Price Sensitivity for Non­Standard Size PTHPs with a

Cooling Capacity of 11,000 Btu/h and R­22 Refrigerant

**According to**  **the results,**  **the increase**  **in metal**  **prices has**  **resulted in**  **various**

**percentage increases**  **in normalized**  **MPC over**  **the range**  **of normalized**  **EER for**  **the**

**different equipment**  **classes. Table**  **5.12.2 shows**  **the range**  **of percent**  **increase in**  **price for** 

**each equipment**  **class due**  **to metal**  **price increases.** 

**5­70**Table 5.12.2 Material Price Sensitivity Results

Equipment Type Increase in MSP (%)

R­22 R­410A

**Standard Size**  **PTACs with**  **9,000 Btu/h**  **Cooling**

**Capacity 6.5** 

**– 7.2**  **6.8**

**– 7.0** 

**Standard Size**  **PTHPs with**  **9,000 Btu/h**  **Cooling**

**Capacity 5.7** 

**– 6.3**  **6.0**

**– 6.3** 

**Standard Size**  **PTACs with**  **12,000 Btu/h**  **Cooling**

**Capacity 8.7** 

**– 9.3**  **8.0**

**– 8.9** 

**Standard Size**  **PTHPs with**  **12,000 Btu/h**  **Cooling**

**Capacity 7.5** 

**– 8.3**  **7.1**

**– 8.1** 

**Non­Standard Size**  **PTACs with**  **11,000 Btu/h**  **Cooling**

**Capacity 4.3** 

**– 4.9**  **4.3**

**– 5.0** 

**Non­Standard Size**  **PTHPs with**  **11,000 Btu/h**  **Cooling**

**Capacity 3.9** 

**– 4.5**  **3.9**

**– 4.7** 

**According to**  **manufacturers, the**  **increase in**  **copper prices**  **has had**  **a significant** 

**impact on**  **manufacturing costs.**  **Because great**  **quantities of**  **copper are**  **used in**  **the**

**manufacture of**  **heat exchangers**  **and other**  **components for**  **PTACs and**  **PTHPs, the**  **sharp**

**increase in**  **copper price**  **corresponds to**  **significant increases**  **in PTAC**  **and PTHP** 

**equipment MPC.**  **The results**  **show that**  **about a**  **$1.30 (or**  **about a**  **60­percent) increase**  **in**

**copper prices**  **could correspond**  **to about**  **a $30**  **(or about**  **a 6**  **percent) increase**  **in**

**equipment MPC.** 

5.13 ENGINEERING ANALYSIS SUMMARY OF RESULTS

**In the**  **rulemaking process,**  **the results**  **from engineering**  **analysis are**  **used in**  **the**

**LCC analysis**  **to determine**  **customer prices**  **for PTAC**  **and PTHP**  **equipment. Using**  **the**

**calculated manufacturer**  **markup, DOE**  **calculated the**  **MSP of**  **R­22 and**  **R­410A**

**equipment at**  **different efficiency**  **levels, and**  **list each**  **on Table**  **5.13.1 through**  **Table**

**5.13.6.**

Table 5.13.1 MSP for R­22 and R­410A Standard Size PTACs with a 9,000 Btu/h

Cooling Capacity

Efficiency Level (EER) R­22 Equipment MSP

(2007$) R­410A Equipment MSP

(2007$)

**ASHRAE 90.1­1999**  **Level (10.6)**  **$435.27 $509.76** 

**Efficiency Level**  **1 (10.9)**  **$442.27 $519.86** 

**Efficiency Level**  **2 (11.1)**  **$447.33 $527.05** 

**Efficiency Level**  **3 (11.3)**  **$452.72 $534.62** 

**Efficiency Level**  **4 (11.5)**  **$458.44 $542.56** 

**Efficiency Level**  **5 (12.0)**  **$474.14 $564.03** 

**5­71**Table 5.13.2 MSP for R­22 and R­410A Standard Size PTHPs with a 9,000 Btu/h

Cooling Capacity

Efficiency Level (EER) R­22 Equipment MSP

(2007$) R­410A Equipment MSP

(2007$)

**ASHRAE 90.1­1999**  **Level (10.4)**  **$495.51 $568.00** 

**Efficiency Level**  **1 (10.9)**  **$506.77 $584.36** 

**Efficiency Level**  **2 (11.1)**  **$511.83 $591.55** 

**Efficiency Level**  **3 (11.3)**  **$517.22 $599.12** 

**Efficiency Level**  **4 (11.5)**  **$522.94 $607.06** 

**Efficiency Level**  **5 (12.0)**  **$538.64 $628.53** 

Table 5.13.3 MSP for R­22 and R­410A Standard Size PTACs with a 12,000 Btu/h

Cooling Capacity

Efficiency Level (EER) R­22 Equipment MSP

(2007$) R­410A Equipment MSP

(2007$)

**ASHRAE 90.1­1999**  **Level (9.9)**  **$496.47 $608.99** 

**Efficiency Level**  **1 (10.2)**  **$504.84 $621.70** 

**Efficiency Level**  **2 (10.4)**  **$511.14 $630.94** 

**Efficiency Level**  **3 (10.6)**  **$518.01 $640.80** 

**Efficiency Level**  **4 (10.8)**  **$525.45 $651.29** 

**Efficiency Level**  **5 (11.5)**  **$556.02 $692.87** 

Table 5.13.4 MSP for R­22 and R­410A Standard Size PTHPs with a 12,000 Btu/h

Cooling Capacity

Efficiency Level (EER) R­22 Equipment MSP

(2007$) R­410A Equipment MSP

(2007$)

**ASHRAE 90.1­1999**  **Level (9.7)**  **$556.10 $665.80** 

**Efficiency Level**  **1 (10.2)**  **$569.34 $686.20** 

**Efficiency Level**  **2 (10.4)**  **$575.64 $695.44** 

**Efficiency Level**  **3 (10.6)**  **$582.51 $705.30** 

**Efficiency Level**  **4 (10.8)**  **$589.95 $715.79** 

**Efficiency Level**  **5 (11.7)**  **$630.54 $770.65** 

Table 5.13.5 MSP for R­22 and R­410A Non­Standard Size PTACs 11,000 Btu/h

Cooling Capacity

Efficiency Level (EER) R­22 Equipment MSP

(2007$) R­410A Equipment MSP

(2007$)

**ASHRAE 90.1­1999**  **Level (8.6)**  **$592.38 $679.06** 

**Efficiency Level**  **1 (9.4)**  **$601.11 $697.09** 

**Efficiency Level**  **2 (9.7)**  **$606.81 $706.60** 

**Efficiency Level**  **3 (10.0)**  **$613.83 $717.61** 

**Efficiency Level**  **4 (10.7)**  **$635.38 $749.14** 

**Efficiency Level**  **5 (11.2)**  **$655.18 $776.66** 

**5­72**Table 5.13.6 MSP for R­22 and R­410A Non­Standard Size PTHPs 11,000 Btu/h

Cooling Capacity

Efficiency Level (EER) R­22 Equipment MSP

(2007$) R­410A Equipment MSP

(2007$)

**ASHRAE 90.1­1999**  **Level (8.5)**  **$656.45 $742.06** 

**Efficiency Level**  **1 (9.4)**  **$665.61 $761.59** 

**Efficiency Level**  **2 (9.7)**  **$671.31 $771.10** 

**Efficiency Level**  **3 (10.0)**  **$678.33 $782.11** 

**Efficiency Level**  **4 (10.7)**  **$699.88 $813.64** 

**Efficiency Level**  **5 (11.4)**  **$728.63 $853.34** 

**The analysis**  **results show**  **that the**  **R­410A equipment**  **MSP is**  **approximately 13**  **to**

**25 percent**  **higher than**  **R­22 equipment**  **MSP depending**  **on the**  **equipment type,** 

**efficiency level,**  **and cooling**  **capacity. Table**  **5.13.7 show**  **the range**  **of percent**  **increase in** 

**MSP for**  **R­410A equipment**  **in comparison**  **to R­22**  **equipment.**

Table 5.13.7 Increase in MSP from R­22 to R­410A for the Various Equipment

Equipment Class (Cooling Capacity) Increase in MSP from R­22 to R­410A (%)

**Standard Size**  **PTACs 9,000**  **Btu/h 17.1** 

**– 19.0** 

**Standard Size**  **PTHPs 9,000**  **Btu/h 14.6** 

**– 16.7** 

**Standard Size**  **PTACs 12,000**  **Btu/h 22.7** 

**– 24.6** 

**Standard Size**  **PTHPs 12,000**  **Btu/h 19.7** 

**– 22.2** 

**Non­Standard Size**  **PTACs 11,000**  **Btu/h 14.6** 

**– 18.5** 

**Non­Standard Size**  **PTHPs 11,000**  **Btu/h 13.0** 

**– 17.2** 

**5­73**REFERENCES

**1 Air­Conditioning,**  **and Refrigeration**  **Institute.** ARI PTAC and PTHP Shipment

–

December 20, 2006

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**2 Air­Conditioning,**  **Heating, and**  **Refrigeration Institute.**  ARI Directory of Certified

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**. http://www.ahridirectory.org/ahriDirectory/pages/home.aspx.** 

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**3 Nadel,**  **S.** Form for Submittal of Proposed Change to ASHRAE Standard Under

Continuous Maintenance (Standard 90.1­2004)

**. September**  **23, 2005.** 

**4 U.S.**  **Department of**  **Energy­Office of**  **Energy Efficiency**  **and Renewable**  **Energy.**

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**9 Plastic**  **News,** Resin Pricing

**. http://www.plasticsnews.com/subscriber/headlines.phtml.** 

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**10 Emerson**  **Climate Technologies.**  **R410A Questions.** 

**http://www.emersonclimate.com/faq_copeland.htm#R410A (Last**  **accessed August**  **2,**

**2007.)**

**5­74 11**  **Air­Conditioning and**  **Refrigeration Institute.**  Response to ASHRAE 90.1 Continuous

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**. May**  **18, 2006.** 

**5­75**