APPENDIX 11B. NATIONAL EQ UIPMENT AND OPERATING COSTS 

TABLE OF CONTENTS 

11B.1 INTRODUCTION .................................................................................................11B-1 

11B.2 RESULTS ..............................................................................................................11B-2 

LIST OF TABLES 

Table 11B.2.1 Commercial Clothes Washers, Top-Loading: Cumulative National 

Equipment and Operating Costs with NPV from 2013–2043, SevenPercent Discount Rate (billion 2008$).......................................................11B-3 

Table 11B.2.2 Commercial Clothes Washers, Top-Loading: Cumulative National 

Equipment and Operating Costs with NPV from 2013–2043, ThreePercent Discount Rate (billion 2008$).......................................................11B-3 

Table 11B.2.3 Commercial Clothes Washers, Front-Loading: Cumulative National 

Equipment and Operating Costs with NPV from 2013–2043, SevenPercent Discount Rate (billion 2008$).......................................................11B-4 

Table 11B.2.4 Commercial Clothes Washers, Front-Loading: Cumulative National 

Equipment and Operating Costs with NPV from 2013–2043, ThreePercent Discount Rate (billion 2008$).......................................................11B-4 

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APPENDIX 11B. NATIONAL EQUIPMENT AND OPERATING COSTS 

11B.1 INTRODUCTION 

In this appendix, the Department presents the components of the net present value (NPV), 

namely, the present value of the equipment (or total installed costs) and the present value of the 

operating costs for each of the four appliance products. The present value of equipment costs is 

also termed the cumulative national equipment costs while the present value of operating costs is 

also termed the cumulative national operating costs. 

As presented in Chapter 11, National Impact Analysis, the NPV is described by the 

equation: 

_ NPV = PVS PVC 

where: 

PVS = Present value of operating cost savings (including energy, water, repair, and 

maintenance costs) and 

PVC = Present value of increased total installed costs (including equipment and 

installation). 

The PVS and PVC are determined according to the following expressions: 

PVS = ‡”OCSy × DFy 

PVC = ‡”TICy × DFy 

where: 

OCS = Total annual operating cost savings each year summed over vintages of the 

product stock, 

TIC = Total annual installed cost increases each year summed over vintages of the 

product stock, 

DF = Discount factor in each year, and 

y = Year in the forecast (i.e., 2013 to 2043). 

PVS and PVC are determined for each year from the effective date of the standard to the year 

when units purchased in 2043 retire. 

The present value of operating costs and the present value of equipment costs (or total 

installed costs) are the components comprising the PVS and PVC, respectively. The PVS is 

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determined by taking the difference between the present value of operating costs for the base 

case and the present value of operating costs for the standards case. The PVC is determined by 

taking the difference between the present value of equipment costs for the base case and the 

present value of equipment costs for the standards case. 

11B.2 RESULTS 

The following sections provide tables showing the present value of operating costs (also 

known as the cumulative national operating costs) and the present value of equipment costs (also 

known as the cumulative national equipment costs) for commercial clothes washers. Two sets of 

results are presented; one based on a seven-percent and another based on a three-percent discount 

rate. 

In the tables provided in the following sections, the national operating and equipment 

costs are presented for the base case (i.e., without standards) and each standard level analyzed. 

Differences between the base case and standards cases are also presented. The difference in the 

national equipment costs represents the PVC or present value of equipment cost increases while 

the difference in the national operating costs represents the PVS or present value of operating 

cost savings. The difference between the base case and standards case total national equipment 

and operating costs represents the NPV. 

Tables 11B.2.1–11B.2.4 present the national equipment and operating costs, PVC, PVS, 

and NPV for commercial clothes washers at real discount rates of seven- and three-percent, 

respectively. 

As detailed in Chapter 11, shipments projections under the standards cases were 

determined to be lower than those in the base case projection due to the higher installed cost of 

the more efficient equipment. Typically, DOE would use the standards case shipments 

projection and, in turn, the standards case equipment stock, to determine the NPV to avoid the 

inclusion of savings due to displaced shipments. But because DOE assumed that any drop in 

shipments caused by standards would result in the purchase of used machines, DOE maintained 

the use of the base case shipments to determine the annual energy consumption in the base case. 

Thus, the base case values shown in Tables 11B.2.1 to 11B.2.4 do not vary with the standards 

case. Both the CSL and TSL are identified in the following tables. 

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Table 11B.2.1	 Commercial Clothes Washers, Top-Loading: Cumulative National 

Equipment and Operating Costs with NPV from 2013–2043, SevenPercent Discount Rate (billion 2008$) 

Standard Level Equipment Operating Total 

Base Case 1.14 7.40 8.54 

CSL 1 / TSL 1, 2 1.25 7.28 8.53 

Difference* -0.11 0.12 0.01 

Base Case 1.14 7.40 8.54 

CSL 2 / TSL 3, 4, 5 1.36 6.83 8.20 

Difference* -0.22 0.56 0.34 

* Equipment Cost Difference represents the PVC; Operating Cost Difference represents the PVC; NPV is 

represented by the bold and italicized values. 

Table 11B.2.2	 Commercial Clothes Washers, Top-Loading: Cumulative National 

Equipment and Operating Costs with NPV from 2013–2043, ThreePercent Discount Rate (billion 2008$) 

Standard Level Equipment Operating Total 

Base Case 2.05 14.62 16.67 

CSL 1 / TSL 1, 2 2.25 14.36 16.60 

Difference* -0.20 0.26 0.07 

Base Case 2.05 14.62 16.67 

CSL 2 / TSL 3, 4, 5 2.45 13.36 15.81 

Difference* -0.40 1.26 0.86 

* Equipment Cost Difference represents the PVC; Operating Cost Difference represents the PVC; NPV is 

represented by the bold and italicized values. 

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Table 11B.2.3	 Commercial Clothes Washers, Front-Loading: Cumulative National 

Equipment and Operating Costs with NPV from 2013–2043, SevenPercent Discount Rate (billion 2008$) 

Standard Level Equipment Operating Total 

Base Case 0.88 2.31 3.19 

CSL 1 / TSL 1 0.88 2.31 3.19 

Difference* 0.00 0.00 0.00 

Base Case 0.88 2.31 3.19 

CSL 2 / TSL 2, 3 0.88 2.30 3.18 

Difference* 0.00 0.02 0.01 

Base Case 0.88 2.31 3.19 

CSL 3 / TSL 4 0.90 2.22 3.12 

Difference* -0.02 0.09 0.07 

Base Case 0.88 2.31 3.19 

CSL 4 / TSL 5 0.93 2.10 3.03 

Difference* -0.05 0.21 0.17 

* Equipment Cost Difference represents the PVC; Operating Cost Difference represents the PVC; NPV is 

represented by the bold and italicized values. 

Table 11B.2.4	 Commercial Clothes Washers, Front-Loading: Cumulative National 

Equipment and Operating Costs with NPV from 2013–2043, ThreePercent Discount Rate (billion 2008$) 

Standard Level Equipment Operating Total 

Base Case 1.58 4.53 6.11 

CSL 1 / TSL 1 1.58 4.52 6.10 

Difference* 0.00 0.01 0.01 

Base Case 1.58 4.53 6.11 

CSL 2 / TSL 2, 3 1.58 4.50 6.08 

Difference* 0.00 0.03 0.03 

Base Case 1.58 4.53 6.11 

CSL 3 / TSL 4 1.62 4.32 5.94 

Difference* -0.04 0.21 0.17 

Base Case 1.58 4.53 6.11 

CSL 4 / TSL 5 1.66 4.06 5.72 

Difference* -0.08 0.47 0.39 

* Equipment Cost Difference represents the PVC; Operating Cost Difference represents the PVC; NPV is 

represented by the bold and italicized values. 

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