Rulemaking Framework for 

Refrigerated Bottled or Canned Beverage Vending Machines

Docket # EERE-2013-BT-STD-0022

United States Department of Energy

Office of Energy Efficiency and Renewable Energy

Building Technologies Program

May 29, 2013
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TABLE OF CONTENTS

1. INTRODUCTION ..................................................................................................................1

1.1 The Appliances and Commercial Equipment Standards Program..............................1

1.2 Rulemaking History....................................................................................................2

1.3 Definitions...................................................................................................................4

1.4 Current Energy Conservation Standards.....................................................................5

1.5 Standby Mode and Off Mode Standards.....................................................................5

1.6 Overview of the Rulemaking Process.........................................................................6

1.6.1 General Rulemaking Process and Participation of Interested Parties..........6

1.6.2 Test Procedure .............................................................................................7

1.7 Preliminary Analysis.................................................................................................11

1.8 Notice of Proposed Rulemaking (NOPR).................................................................12

1.9 Final Rule..................................................................................................................12

2. ANALYSES FOR ENERGY CONSERVATION STANDARDS RULEMAKING...........13

3. MARKET AND TECHNOLOGY ASSESSMENT.............................................................14

3.1 Market Assessment ...................................................................................................15

3.2 Overview of Beverage Vending Machines...............................................................15

3.3 Equipment Classes....................................................................................................17

3.4 Technology Assessment............................................................................................19

3.5 Baseline Units...........................................................................................................21

4. SCREENING ANALYSIS ...................................................................................................21

5. ENGINEERING ANALYSIS...............................................................................................22

5.1 Engineering Analysis Overview ...............................................................................22

5.2 Proposed Approach for Determining the Cost-Efficiency Relationship...................23

5.3 Manufacturer Prices..................................................................................................24

5.4 Proprietary Designs...................................................................................................25

5.5 Representative Sizes .................................................................................................25

5.6 Outside Regulatory Changes Affecting the Engineering Analysis...........................26

6. ENERGY USE ANALYSIS.................................................................................................27

7. MARKUPS ANALYSIS ......................................................................................................27

8. LIFE-CYCLE COST AND PAYBACK PERIOD ANALYSIS ..........................................28

8.1 Overview...................................................................................................................28

8.2 Energy Prices............................................................................................................29

8.3 Life-Cycle Cost Discount Rates................................................................................29

8.4 Installation, Maintenance, and Repair Costs.............................................................30

8.5 Equipment Lifetimes.................................................................................................31

9. SHIPMENTS ANALYSIS ...................................................................................................31

9.1 Base-Case Projections...............................................................................................31

9.2 Accounting Methodology .........................................................................................32

9.3 Standards Impacts on Shipments..............................................................................32

10. NATIONAL IMPACT ANALYSIS.....................................................................................33

10.1 Calculation of Energy Savings..................................................................................33

10.2 Net Present Value .....................................................................................................34

11. CUSTOMER SUBGROUP ANALYSIS..............................................................................34

12. MANUFACTURER IMPACT ANALYSIS.........................................................................35
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12.1 Sources of Information .............................................................................................35

12.2 Industry Cash Flow Analysis....................................................................................36

12.3 Manufacturer Subgroup Analysis.............................................................................36

12.4 Competitive Impacts Assessment .............................................................................37

12.5 Cumulative Regulatory Burden ................................................................................37

13. EMPLOYMENT IMPACT ANALYSIS..............................................................................37

14. UTILITY IMPACT ANALYSIS..........................................................................................38

15. EMISSIONS ANALYSIS.....................................................................................................38

16. MONETIZING REDUCED CO2 AND OTHER EMISSIONS ...........................................40

17. REGULATORY IMPACT ANALYSIS ..............................................................................41

APPENDIX A – LIST OF ITEMS FOR COMMENT..................................................................43

LIST OF FIGURES

Figure 2.1 Flow Diagram of Analyses for the BVM Standards Rulemaking Process.................. 14

LIST OF TABLES

Table 1.4.1 Energy Conservation Standards for Beverage Vending Machines, Prescribed by 2009 

BVM Final Rule – Compliance Date August 31, 2012 ............................................. 5

Table 5.5.1 Representative Sizes for Beverage Vending Machines in 2009 BVM Rulemaking . 25
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LIST OF ACRONYMS

ABA American Beverage Association 

AEO Annual Energy Outlook

AHAM Association of Home Appliance Manufacturers

ANOPR advance notice of proposed rulemaking

ANSI American National Standards Institute 

ASHRAE American Society of Heating, Refrigerating, and Air-Conditioning Engineers

BT Building Technologies Program

BVM beverage vending machine

CAIR Clean Air Interstate Rule

CFC chlorofluorocarbon

CFR Code of Federal Regulations

CO2 carbon dioxide

CSL candidate standard level

CSAPR Cross-State Air Pollution Rule

DOE U.S. Department of Energy

DOJ U.S. Department of Justice

ECM electronically commutated motor

EGU electric generating unit

EIA U.S. Energy Information Administration

EPA U.S. Environmental Protection Agency

EPCA Energy Policy and Conservation Act of 1975

FFC full-fuel-cycle

GHG greenhouse gas

GRIM Government Regulatory Impact Model

HAP hazardous air pollutants

HC hydrocarbon

HCFC hydrochlorofluorocarbon

HFC hydrofluorocarbon

Hg mercury

ImSET Impact of Sector Energy Technologies

LCC life-cycle cost

MATS Mercury and Air Toxics Standards

MIA manufacturer impact analysis

MSP manufacturer selling price

NAMA National Automatic Merchandising Association

NEMS National Energy Modeling System

NES national energy savings

NIA national impact analysis

NOPR notice of proposed rulemaking

NOX nitrogen oxides

NPV net present value

OIRA Office of Information and Regulatory Affairs

OMB Office of Management and Budget

PBP payback period
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PM particulate matter

R&D research and development

RIA regulatory impact analysis

SCC Social Cost of Carbon

SO2 sulfur dioxide

TSD technical support document

TSL trial standard level

WACC weighted-average cost of capital
1

Rulemaking Framework for Beverage Vending Machines

1. INTRODUCTION

The U.S. Department of Energy (DOE) develops and promulgates test procedures and 

energy conservation standards for certain consumer appliances and commercial equipment. The 

process for developing standards involves analysis, public notice and comment, and consultation 

with interested parties. Interested parties, also referred to as stakeholders, include manufacturers, 

customers, energy conservation and environmental advocates, State and Federal agencies, and 

any other groups or individuals with an interest in these standards and test procedures.

This Framework document provides an overview of the procedural and analytical 

approaches DOE anticipates using to determine whether to amend the existing energy 

conservation standards for refrigerated bottled or canned beverage vending machines, herein 

referred to as beverage vending machines (BVM) (see section 1.1 for a discussion of the 

statutory authority for this rulemaking). The existing energy conservation standards for beverage 

vending machines can be found at 10 CFR 431.296 and are applicable to BVM units 

manufactured on or after August 31, 2012, as mandated by the Energy Policy and Conservation 

Act of 1975 (EPCA), as amended. (42 U.S.C. 6295(v)) 

This document is intended to inform stakeholders of the procedural and analytical 

approaches for the energy conservation standards and test procedure rulemakings for covered 

beverage vending machines, and to encourage and facilitate stakeholder input during the 

rulemaking. This document is the starting point for determining whether to amend the existing 

energy conservation standards, and if so, for developing such standards, and is not a definitive 

statement with respect to any issue to be determined in the rulemaking.

Section 1 provides an overview of the rulemaking process. Sections 2 through 17 discuss 

analyses DOE intends to conduct to fulfill the statutory requirements and guidance for this 

energy conservation standards rulemaking for beverage vending machines. DOE is required, as 

part of this rulemaking, to determine whether to amend existing energy conservation standards 

for this equipment. These analyses will support DOE’s determination of whether to amend the 

standards, and, if the determination is positive, its establishment of any amended energy 

conservation standards. Information regarding this rulemaking will be maintained on the DOE 

website at

http://www1.eere.energy.gov/buildings/appliance_standards/rulemaking.aspx/ruleid/73.

While DOE invites comment on all aspects of the material presented in this Framework 

document, several specific issues on which DOE seeks comment are set out in comment 

boxes like this one. DOE uses these comment boxes to highlight issues and ask specific 

questions on the approaches DOE is proposing to follow in conducting the analyses 

required for the energy conservation standards rulemaking. Such requests for 

stakeholder feedback are numbered according to the section in which they appear.

1.1 The Appliances and Commercial Equipment Standards Program

Title III of EPCA sets forth a variety of provisions designed to improve the energy 

efficiency of various products and equipment. Part B of Title III provides for the “Energy 
2

Conservation Program for Consumer Products Other Than Automobiles.” (42 U.S.C. 6291–

6309) As part of this program, EPCA directed DOE to prescribe energy conservation standards 

for beverage vending machines. (42 U.S.C. 6295(v))1

Under 42 U.S.C. 6295(m)(1), within 6 years after issuance of any final rule establishing 

or amending a standard, DOE is required to publish:

(A) A notice of the determination of the Secretary of Energy (Secretary) that energy 

conservation standards for the product do not need to be amended, based on the 

criteria established under subsection (n)(2); or

(B) A notice of proposed rulemaking including new proposed energy conservation 

standards based on the criteria established under subsection (o) and the procedures 

established under subsection (p).

DOE is undertaking this rulemaking, including the publication of this Framework 

document, to meet this EPCA requirement.

1.2 Rulemaking History

EPCA directed the Secretary to issue by rule, no later than August 8, 2009, energy 

conservation standards for refrigerated bottled or canned beverage vending machines. DOE 

undertook a rulemaking process beginning in 2006, when it published the Rulemaking 

Framework for Refrigerated Bottled or Canned Beverage Vending Machines (henceforth 

referred to as the 2006 BVM Framework document). This document is available at: 

http://www.regulations.gov/#!documentDetail;D=EERE-2006-STD-0125-0002. The 2006 BVM 

Framework document described the procedural and analytical approaches DOE anticipated using 

to evaluate the establishment of energy conservation standards for beverage vending machines. 

DOE held a public meeting on July 11, 2006 (henceforth referred to as the 2006 BVM 

Framework public meeting) to discuss procedural and analytical approaches to the rulemaking, 

and to inform and facilitate the involvement of interested parties in the rulemaking process. The 

analytical framework presented at the public meeting described different analyses, such as the 

engineering analysis and the life-cycle cost (LCC) analysis, the methods proposed for conducting 

them, and the relationships among the various analyses.

After the 2006 BVM Framework public meeting, as part of the information gathering 

process for the preliminary manufacturer impact analysis (MIA), DOE held interviews with 

BVM manufacturers. DOE selected manufacturers that represented production of a wide range of 

equipment covered by the rulemaking, including both small and large manufacturers. DOE had 

 

1

Because of its placement in Part B of Title III of EPCA, the provisions of Part B apply to the rulemaking for BVM 

energy conservation standards. Because beverage vending machines are commonly referred to as commercial 

equipment, however, DOE places the requirements for beverage vending machines in Title 10 of the Code of 

Federal Regulations (CFR), part 431, “Energy Efficiency Program for Certain Commercial and Industrial 

Equipment.” The location of the provisions within the CFR does not affect either their substance or applicable 

procedure; DOE is placing them in the commercial CFR part as a matter of administrative convenience based on 

their nature or type. DOE will refer to beverage vending machines as “equipment” throughout the document because 

of their placement in 10 CFR part 431. 
3

four objectives for these interviews: (1) solicit feedback on the draft engineering analysis 

(including methodology, production costs, manufacturing processes, and findings); (2) solicit 

feedback on topics related to the preliminary MIA; (3) provide an opportunity, early in the 

rulemaking process, for these manufacturers to express specific concerns to DOE; and (4) foster 

cooperation between the manufacturers and DOE.

DOE developed a preliminary engineering analysis to estimate the cost of manufacturing 

equipment at efficiencies above the baseline levels.2 DOE also developed spreadsheets to 

conduct the LCC analysis and national impact analysis (NIA). The LCC spreadsheet calculates 

national distributions of LCC savings at various energy efficiency levels above the baseline. It 

can also provide LCC savings based on typical input values for several business types that use 

beverage vending machines. The NIA spreadsheet calculates the national energy savings (NES) 

and national net present values (NPVs) at various energy efficiency levels. It also includes a 

model that forecasts shipments for the various equipment classes of beverage vending machines 

at different efficiency levels.

In June 2008, DOE published an advance notice of proposed rulemaking and notice of 

public meeting (ANOPR) for refrigerated bottled or canned beverage vending machines

(henceforth referred to as the 2008 BVM ANOPR). 73 FR 34094 (June 16, 2008). This 

document is available at http://www.regulations.gov/#!documentDetail;D=EERE-2006-STD0125-0003. In that ANOPR, DOE considered establishing energy conservation standards for 

beverage vending machines and announced a public meeting to receive comments on a variety of 

issues. 

DOE held a public meeting on June 26, 2008 to provide interested parties the opportunity 

to comment on the proposed equipment classes DOE was considering; the analytical framework, 

models, and tools (e.g., LCC and NES spreadsheets) that DOE had developed to perform 

analyses of the impacts of potential energy conservation standards; the results of the preliminary 

analyses; and the candidate energy conservation standard levels. 

After the publication of the 2008 BVM ANOPR and the presentation of the ANOPR to 

interested parties at the public meeting, DOE conducted additional interviews with BVM 

manufacturers as part of its development of the MIA for the notice of proposed rulemaking 

(NOPR). There were 13 topics discussed during each of the interviews: (1) general key issues; 

(2) company overview and organizational characteristics; (3) company financial parameters; 

(4) production cost breakdown; (5) shipment projections and market shares; (6) equipment 

mixes; (7) conversion costs; (8) markups and profitability; (9) cumulative regulatory burden; 

(10) exports, foreign competition, and outsourcing; (11) direct employment impact assessment; 

(12) market consolidation; and (13) baseline products and different design options. Based on 

findings from the preliminary engineering, analyses (LCC, NES, and NIA), and public comments 

provided in response to the ANOPR, DOE updated the analyses. 

 

2 The baseline level (i.e., the minimum level) typically represents the energy efficiency of equipment with the lowest 

energy efficiency level available on the market for a given category. For equipment categories where minimum 

energy conservation standards already exist, the baseline efficiency level is typically defined by the existing energy 

conservation standards.
4

In May 2009, DOE published a NOPR for refrigerated bottled or canned beverage 

vending machines (henceforth referred to as the 2009 BVM NOPR) to propose energy 

conservation standards for refrigerated beverage vending machines, and to announce a public 

meeting to receive comments on a variety of issues. 74 FR 26020 (May 29, 2009). This 

document is available at http://www.regulations.gov/#!documentDetail;D=EERE-2006-STD0125-0003.

DOE held a public meeting on June 17, 2009 (henceforth referred to as the 2009 BVM 

NOPR public meeting) to provide interested parties the opportunity to comment on the proposed 

standards, results of the analyses, and the trial standard levels (TSLs). 

After the publication of the 2009 BVM NOPR and the public meeting, DOE received 

comments from a diverse set of parties, including manufacturers and their representatives,

customers, energy conservation advocates, state officials and agencies, and electric utilities. 

DOE considered these comments and in August 2009 published a final rule for beverage vending 

machines (henceforth referred to as the 2009 BVM final rule). 74 FR 44914 (Aug. 31, 2009). 

The entire rulemaking process that culminated with the publication of the 2009 BVM final rule 

will be referred to as the 2009 BVM rulemaking. The 2009 BVM final rule established energy 

conservation standards for beverage vending machines, with a compliance date of August 31, 

2012. The 2009 BVM final rule document is currently available at 

http://www.regulations.gov/#!documentDetail;D=EERE-2006-STD-0125-0005.

1.3 Definitions

EPCA defines a beverage vending machine as follows:

The term ‘refrigerated bottled or canned beverage vending machine’ means a commercial 

refrigerator3that cools bottled or canned beverages and dispenses the bottled or canned 

beverages on payment. 

(42 U.S.C. 6291(40))

In the 2009 BVM final rule, DOE added the following definitions to 10 CFR 431.292, 

“Definitions concerning refrigerated bottled or canned vending machines”: 

Bottled or canned beverage means a beverage in a sealed container.

 

3

In addition, section 136(a)(3) of EPACT 2005 amended section 340 of EPCA in part by adding a definition for 

“commercial refrigerator, freezer, and refrigerator-freezer.” (42 U.S.C. 6311(9)(A)) This definition reads as follows:

(9)(A) The term ‘commercial refrigerator, freezer, and refrigerator-freezer’ means refrigeration equipment that—

(i) is not a consumer product (as defined in section 321 [of EPCA; 42 U.S.C. 6291(1)]);

(ii) is not designed and marketed exclusively for medical, scientific, or research purposes;

(iii) operates at a chilled, frozen, combination chilled and frozen, or variable temperature;

(iv) displays or stores merchandise and other perishable materials horizontally, semivertically, or vertically;

(v) has transparent or solid doors, sliding or hinged doors, a combination of hinged, sliding, transparent, or 

solid doors, or no doors;

(vi) is designed for pull-down temperature applications or holding temperature applications; and

(vii) is connected to a self-contained condensing unit or to a remote condensing unit.
5

Class A means a refrigerated bottled or canned beverage vending machine that is fully 

cooled, and is not a combination vending machine.

Class B means any refrigerated bottled or canned beverage vending machine not 

considered to be Class A, and is not a combination vending machine.

Combination vending machine means a refrigerated bottled or canned beverage vending 

machine that also has nonrefrigerated volumes for the purpose of vending other, 

non-“sealed beverage” merchandise.

V means the refrigerated volume (ft3) of the refrigerated bottled or canned beverage 

vending machine, as measured by ANSI/AHAM HRF–1–2004.

1.4 Current Energy Conservation Standards

Table 1.4.1 shows the current standards for beverage vending machines at 10 CFR 

431.296, as prescribed by the 2009 BVM final rule. 74 FR at 44968 (Aug. 31, 2009).

Table 1.4.1 Energy Conservation Standards for Beverage Vending Machines,

Prescribed by 2009 BVM Final Rule – Compliance Date August 31, 2012

Class Definition

Maximum Daily 

Energy Consumption 

kWh/day

A

a refrigerated bottled or canned beverage vending machine that is fully 

cooled, and is not a combination vending machine 0.055 × V + 2.56

B

any refrigerated bottled or canned beverage vending machine not 

considered to be Class A, and is not a combination vending machine 0.073 × V + 3.16

Combination

a refrigerated bottled or canned beverage vending machine that also 

has nonrefrigerated volumes for the purpose of vending other, non-

“sealed beverage” merchandise

[reserved]

1.5 Standby Mode and Off Mode Standards

EPCA requires any new or amended energy conservation standards adopted after July 1, 

2010 to incorporate standby mode and off mode energy use. (42 U.S.C. 6295(gg)(3)(A)) 

EPCA also defines the terms “active mode,” “off mode,” and “standby mode.” “Active 

mode” is defined as the condition in which an energy-using product is connected to a main 

power source, has been activated, and provides one or more main functions. “Off mode” is 

defined as the condition in which an energy-using product is connected to a main power source, 

and is not providing any standby or active mode function. “Standby mode” is defined as the 

condition in which an energy-using product is connected to a main power source and offers one 

or more of the following user-oriented or protective functions: facilitating the activation or 

deactivation of other functions (including active mode) by remote switch (including remote 

control), internal sensor, or timer; or providing continuous functions, including information or 

status displays (including clocks) or sensor-based functions. (42 U.S.C. 6295(gg)(1)(A)) DOE 

may by rule amend these definitions after considering the most current versions of certain 

industry standards. (42 U.S.C. 6295(gg)(1)(B)) 

When connected to a power source, beverage vending machines always actively provide 

one of the main functions—refrigeration. Therefore, DOE believes that beverage vending 

machines do not operate under standby and off mode conditions as defined in EPCA, and that the 

energy use of a beverage vending machine would be captured in any standard established for 
6

active mode energy use. (42 U.S.C. 6295(gg)(1)(A)) DOE does not plan to include standards 

regulating standby and off mode energy consumption for the equipment.

1.6 Overview of the Rulemaking Process

1.6.1 General Rulemaking Process and Participation of Interested Parties

EPCA requires that any new or amended standards achieve the maximum energy 

efficiency or water efficiency that is technologically feasible and economically justified. To 

determine whether a standard is economically justified, EPCA requires that DOE determine 

whether the benefits of the standard exceed its burdens by considering, to the greatest extent 

practicable, the following:

i. the economic impact of the standard on the manufacturers and consumers of the 

affected products; 

ii. the savings in operating costs throughout the estimated average life of the product 

compared to any increases in the initial cost or maintenance expense; 

iii. the total projected amount of energy savings likely to result directly from the 

imposition of the standard; 

iv. any lessening of the utility or the performance of the products likely to result from 

the imposition of the standard; 

v. the impact of any lessening of competition, as determined in writing by the 

Attorney General, that is likely to result from the imposition of the standard; 

vi. the need for national energy conservation; and 

vii. other factors the Secretary considers relevant. 

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

As discussed in further detail below, the standards rulemaking process typically involves 

four public notices that are published in the Federal Register. Publication of the Framework 

document, preliminary analysis, and NOPR are typically accompanied by public meetings and 

comment periods to solicit comment from interested parties to enhance the rulemaking process.

DOE also encourages interested parties to develop and submit joint recommendations and 

will carefully consider such recommendations in its decision making. DOE believes that the 

analyses accompanying these notices will support DOE’s determination whether to amend the 

standards, and, if the determination is positive, to establish any amended standards. 

In this Framework document, DOE presents the procedural and analytical approaches it 

expects to use to determine whether the establishment of amended energy conservation standards 

for beverage vending machines is justified and, if so, to set new, amended standards. DOE also 

presents several issues regarding the regulation of beverage vending machines and requesting 

feedback from interested parties. Following publication of the Framework document, DOE will 

publish a preliminary analysis, a NOPR, and a final rule. These rulemaking stages are 

summarized below and described more fully in subsequent sections. 

Preliminary analysis (section 1.7). The preliminary analysis is designed to publicly 

vet the models and tools that DOE intends to use in the rulemaking, and to facilitate 

public participation before the proposed rule stage. Using these models and tools, 
7

DOE performs preliminary analyses to assess candidate standard levels (CSLs), 

which span the range of efficiencies from baseline equipment to the most efficient 

technology. 

Notice of proposed rulemaking (section 1.8). The NOPR presents a discussion of 

comments received in response to the preliminary analysis; DOE’s analysis of the 

impacts of potential standards on customers, manufacturers, and the nation; DOE’s 

weighting of these impacts; and any proposed standard levels for public comment. 

Final rule (section 1.9). The final rule presents a discussion of comments received in 

response to the NOPR, revised analysis, as appropriate, of the impacts of any 

standards, DOE’s weighting of those impacts, and the standard levels, if any, that 

DOE is adopting. The final rule also establishes the date for compliance with any 

standards. 

1.6.2 Test Procedure

In December 2006, DOE published a final rule establishing a test procedure for beverage 

vending machines (the 2006 BVM test procedure final rule). 71 FR 71340, 71355 (Dec. 8, 2006).

In that final rule, consistent with 42 U.S.C. 6293(b)(15), DOE adopted American National 

Standards Institute (ANSI) / American Society of Heating, Refrigerating, and Air-Conditioning 

Engineers (ASHRAE) Standard 32.1-2004, “Methods of Testing for Rating Vending Machines 

for Bottled, Canned, or Other Sealed Beverages,” as the DOE test procedure. ANSI/ASHRAE

Standard 32.1-2004 contains rating temperature specifications of 36 °F (±1 °F) average for 

beverages in the next-to-vend position. In the 2006 BVM test procedure final rule, DOE also 

adopted a modification to test equipment with dual nameplate voltages at the lower of the two 

voltages only, and adopted section 5.2, “Refrigerated Volume Calculation,” of ANSI/Association 

of Home Appliance Manufacturers (AHAM) HRF-1-2004 to calculate the refrigerated volume of 

beverage vending machines in lieu of vendible capacity. DOE recognized that section 5.2 of 

ANSI/AHAM HRF-1-2004 addresses the measurement of refrigerated volume in household 

freezers, but determined that the methodology described includes methods for the measurement 

of volumes that are applicable to beverage vending machines and is more appropriate than the 

language in section 4.2 for household refrigerators. 71 FR 58308 (Oct. 3, 2006).

Since the publication of the 2006 BVM test procedure final rule, ASHRAE has updated 

its test procedure. The most recent version is ANSI/ASHRAE Standard 32.1-2010, which 

includes changes aligning it with the nomenclature and methodology used in the 2006 BVM test 

procedure final rule and 2009 BVM final rule. ANSI/ASHRAE 32.1-2010 removes the 

definitions of “bottled” and “canned” and the includes the portions of ANSI/AHAM HRF-1-

2004 incorporated by reference in the 2006 BVM test procedure final rule in a new appendix C. 

DOE believes that the aforementioned changes were largely editorial, and would not affect the 

method of test or other technical aspects of the DOE test procedure. AHAM has also updated its 

test standard since the publication of the 2006 BVM test procedure final rule. The most recent 

version is ANSI/AHAM HRF-1-2008, which includes minor editorial changes to the refrigerated 

volume measurement portion of the standard, including reorganizing some of the sections for 

simplicity and usability. 

EPCA requires DOE to periodically review test procedures for covered equipment to 

determine if amendments are necessary:
8

(A)Amendment.— At least once every 7 years, the Secretary shall review test procedures 

for all covered products and—

(i) amend test procedures with respect to any covered product, if the Secretary 

determines that amended test procedures would more accurately or fully 

comply with the requirements of paragraph (3); or 

(ii) publish notice in the Federal Register of any determination not to amend a test 

procedure.

(42 U.S.C. 6293(b)(1))

Consistent with this requirement, DOE will conduct a test procedure rulemaking 

concurrently with the current energy conservation standards rulemaking. 

DOE is considering updates to its test procedure, both for clarity and to better represent 

the energy use of the various beverage vending machines. DOE is considering the following 

modifications: 

(1) Updating the referenced method of test: As discussed above, DOE incorporated by 

reference ANSI/ASHRAE Standard 32.1-2004, an industry standard for determining 

the daily energy consumption of beverage vending machines. Since the incorporation 

of the 2004 version of ANSI/ASHRAE Standard 32.1 as part of the 2006 BVM test 

procedure final rule, ANSI/ASHRAE Standard 32.1 has been updated to 

ANSI/ASHRAE Standard 32.1-2010. This version includes adjustments in the rating 

metric and nomenclature to align with the DOE test procedure but makes no changes 

that are expected to affect tested daily energy consumption values. DOE is 

considering amendments to its test procedure to reference ANSI/ASHRAE Standard 

32.1-2010.

(2) Clarifying the next-to-vend beverage temperature test condition: DOE is considering 

amendments to the test procedure to clarify that the average of all next-to-vend 

product temperatures be maintained within 36 °F (±1 °F) at all times for the duration 

of the test, which is DOE’s understanding of the intent of the ANSI/ASHRAE 

Standard 32.1 committee. DOE believes that such a procedure is more appropriate 

than one in which the temperature of next-to-vend beverages is averaged across all 

selections and over the entire time of the test resulting in a single value of 36 °F (±1 

°F) because it ensures that next-to-vend beverages remain at the vending temperature 

at all time points during the test. This clarification is consistent with the performance 

in the field, where vending temperature must be held at all times that a purchase may 

be made. 

(3) Testing at a 90 °F ambient test condition: DOE is considering amendments to the test 

procedure that would eliminate the methodology used to derive performance of the 

beverage vending machine at the 90 °F ambient as described in the test method 

incorporated by reference into the DOE test procedure, ANSI/ASHRAE Standard 

32.1-2004, and the updated ANSI/ASHRAE Standard 32.1-2010. DOE understands 

that this test is used primarily to represent and evaluate the performance of units when 
9

installed outdoors; however, the performance of a beverage vending machine at 90 °F 

ambient is not currently used for DOE regulatory purposes. 

(4) Lowest application product temperature: DOE is considering amendments to the test 

procedure to allow covered beverage vending machines that cannot achieve an 

average temperature of next-to-vend products of 36 °F (± 1 °F) to instead be tested at 

their lowest application product temperature. This provision would be consistent with 

DOE’s 2012 test procedure final rule for commercial refrigeration equipment. 77 FR 

10292 (Feb. 21, 2012). In this context, the lowest application product temperature 

would describe the lowest temperature at which the beverage vending machine is 

capable of operating and is often indicated by the lowest setting on a unit’s 

thermostat. The lowest application product temperature provision would specify a 

revised average beverage temperature for beverages in the next-to-vend position, but 

would not modify any other requirements of the DOE test procedure for beverage 

vending machines. 

(5) Product temperature measurements: DOE is considering amendments to the test 

procedure to require additional temperature data. The current DOE equipment class 

distinction is based on whether a machine is fully cooled, which manufacturers 

determine and report based on machine design, Test data gathered using the current 

test procedure does not include any information to show whether a given machine is 

fully cooled. This is because the test procedure requires beverage temperature data 

only from the next-to-vend positions and no other areas of the machine, and thus does 

not quantify the extent to which products in other parts of the machine are cooled. 

DOE is considering requiring temperature measurements of standard test packages at 

locations other than the next-to-vend position as part of this test procedure

rulemaking. These measurements could be used in verifying the equipment class 

(Class A or Class B) of the machine should a question arise.

(6) Expanded range of lighting and control settings: The current DOE test procedure 

requires that the vending machine be operated with normal lighting and control 

settings, using only those energy management controls that are permanently 

operational and not capable of being adjusted by a machine operator.

(ANSI/ASHRAE 32.1-2004 7.1.1(d)). It does not specify how to test equipment that 

has permanently operational controls that can be adjusted, such as beverage vending 

machines that have multiple lighting and control options to select for use in machine 

operation, without an option to disable the controls. DOE is considering amendments 

to the test procedure to indicate what settings are to be used for the testing of 

machines with controls that are permanently operational (cannot be disabled) but can 

be adjusted by the operator.

(7) Creating a provision to measure the impact of low-power modes of operation: DOE is 

considering amendments to the test procedure that include provisions for measuring 

the energy consumption impact of certain low-power modes with which beverage 

vending machines may be equipped. The features of these modes may include (but 

are not limited to) switching off or dimming lights and raising the temperature set 

point (to which the unit cools the products) to a value higher than the temperature set 

point associated with the unit’s normal operation mode. These low-power modes are 

typically activated during off hours or periods of low customer traffic. The current 
10

test procedure requires that the vending machine be operated with normal lighting and 

control settings, using only those energy management controls that are permanently 

operational and not capable of being adjusted by a machine operator. It is likely that 

the current test procedure does not capture the energy savings of all types of energy 

management systems in a representative manner. For the revised test procedure, DOE 

is considering specifying test requirements to account for the potential reduction in 

energy consumption associated with the use of certain energy management systems 

that may not be accounted for in the current test procedure. One amendment under 

consideration is to include a fixed period of time during which a low-power mode 

could be utilized during the test, if the low-power mode is available on the unit as 

shipped from the factory. 

DOE encourages input on how low-power modes or other new technologies could best be 

addressed in a test procedure rulemaking. 

Item 1-1 DOE requests comment regarding adoption of updated test procedure for the 

beverage vending machines covered under this rulemaking.

Item 1-2 DOE requests comment on the possible elimination of the requirement to test 

units at 90 °F. 

Item 1-3 DOE requests comment regarding a requirement of measurement of product 

temperatures at other than the next-to-vend positions.

Item 1-4 DOE requests comment on the current utilization of low-power modes in 

certification testing. Do any current models meet the requirements of the 

current test procedure regarding energy management controls and utilize a 

low-power mode during the test? 

Item 1-5 DOE requests comment on the testing of low-power modes in a revised test 

procedure. What are the typical functions of low-power mode in beverage 

vending machines? Are these low-power modes triggered by scheduled timers,

activity, motion sensors, or other environment or state changes? What lengths 

of time should DOE consider for the full-power mode and low-power mode?

Item 1-6 DOE requests comment on the applicability of the current test procedure, and 

all test procedure modifications under consideration, to combination vending 

machines.

Item 1-7 DOE requests comment on its proposal to consider modifications to the test 

procedure to account for energy management systems.

Manufacturers must use the new or amended procedure to certify compliance with any 

new or amended standards no later than the compliance date of those standards. Manufacturers

may also certify their products to DOE using the test procedure and any revised energy 

conservation standards prior to the compliance date of any amended standards.
11

1.7 Preliminary Analysis

As part of its initial rulemaking activity, DOE typically identifies equipment technology 

options and makes a preliminary determination on whether to retain each option for detailed 

analysis or to eliminate it from further consideration. This process includes a market and 

technology assessment (section 3) and a screening analysis (section 4). DOE applies four 

screening criteria in the screening analysis to determine if any technology options should be

eliminated from further consideration: (1) technological feasibility; (2) practicability to 

manufacture, install, and service; (3) adverse impacts on utility or availability; and (4) adverse 

impacts on health or safety. Technologies that pass the screening analysis are evaluated, and 

referred to as design options, in the engineering analysis.

DOE consults with interested parties and independent technical experts, and conducts 

research into industry literature to identify the key issues and design options or efficiency levels 

that DOE will consider in the rulemaking. DOE initiates dialogue with interested parties with 

this Framework document, the public meeting following its publication, and the request for 

public comment. This dialogue also provides an opportunity for input into the structural and 

analytical approach planned for this energy conservation standards rulemaking.

At the start of any preliminary analysis, DOE considers design options or efficiency 

levels for each equipment class. DOE uses these design options or efficiency levels to collect 

manufacturer cost data, historical shipment data, shipment-weighted average efficiency data, and 

preliminary manufacturer impact data (e.g., capital conversion expenditures, marketing costs, 

and research and development costs). As part of any preliminary analysis, DOE also conducts 

other principal analyses, including (1) the engineering analysis (section 5); (2) the customer LCC 

analysis (section 8); (3) the NIA, which considers NES and customer NPV (section 10); and (4) a 

preliminary MIA (section 12). DOE presents the results of these analyses in the preliminary 

analysis technical support document (TSD).

DOE selects efficiency levels from the energy efficiency or energy use levels considered 

as CSLs in any preliminary analysis. Discussion of various CSLs will help interested parties 

review the data that underpin the analyses. DOE will use interested parties’ comments to refine 

the models for the next stage of the rulemaking analyses. In addition to the efficiency 

corresponding to the maximum technologically feasible (“max-tech”) design and the efficiency 

corresponding to the minimum LCC point, DOE generally considers CSLs or design options that 

span the full range of technologically achievable efficiencies. The range of levels DOE typically 

analyzes includes the following:

the baseline efficiency level (i.e., the minimum level), which typically represents the 

energy efficiency of equipment with the lowest energy efficiency level on the market 

for a given category; for equipment categories where minimum energy conservation 

standards already exist, the baseline efficiency level is typically defined by the 

existing energy conservation standard;

the level with the minimum LCC or greatest LCC savings;

the level with the greatest NPV;

the highest energy efficiency level or lowest energy consumption level that is 

technologically feasible (i.e., max-tech); and

levels that incorporate noteworthy technologies or fill large gaps between other 

efficiency levels considered.
12

At the preliminary analysis stage, DOE uses analytical models and tools to assess the 

different equipment classes at each efficiency or energy use level analyzed. Many of these 

analytical models and tools are in the form of spreadsheets, which are used to conduct the LCC 

analysis and to determine the NES and NPV. 

DOE makes the results of any preliminary analysis available on its website for review.4

When it publishes a preliminary analysis, DOE also makes available a preliminary TSD that

contains the details of all the analyses performed to date. After publication of any preliminary 

analysis, DOE provides a public comment period and hold a public meeting. 

1.8 Notice of Proposed Rulemaking (NOPR)

In developing a NOPR, DOE considers all the comments it received after publication of 

the preliminary analysis. This process may result in revisions to the preliminary analysis, 

including the engineering and LCC analyses. At this point, DOE conducts additional economic 

and environmental impact analyses. These analyses generally include a customer subgroup 

analysis (section 11), a complete MIA (section 12), an employment impact analysis (section 13), 

a utility impact analysis (section 14), an emissions analysis (section 15), monetization of selected 

environmental emissions (section 16), and a regulatory impact analysis (section 17).

DOE describes the methodology used and makes the results of all the analyses available 

on its website for review. Based on comments from interested parties, DOE may revise the 

analyses further. This analytical process ends with the selection of proposed standard levels, if 

any, that DOE will present in the NOPR. DOE selects the proposed standard levels from the 

TSLs analyzed during the NOPR phase of the rulemaking. The NOPR, published in the Federal 

Register, documents the evaluation and selection of any proposed TSLs, along with a discussion 

of other TSLs considered but not selected and the reasons DOE did not select them. 

For each equipment class, DOE identifies the max-tech efficiency level. If DOE proposes 

a less stringent level than the max-tech level, DOE sequentially explains the reasons for 

eliminating higher levels, beginning with the highest level considered. DOE presents the 

analytical results in the NOPR, and provides the details of the analysis in an accompanying TSD.

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

copies of the NOPR and TSD to solicit feedback on the impact of any proposed standard levels 

on competition in the BVM industry. DOJ reviews standard levels in light of any lessening of 

competition likely to result from the imposition of such standards. (42 U.S.C. 

6295(o)(2)(B)(i)(V) and (B)(ii)) Publication of a NOPR is followed by a public comment period 

that includes a public meeting.

1.9 Final Rule

After publication of a NOPR, DOE considers public comments it receives on the proposal 

and accompanying analyses. DOE reviews the engineering and economic impact analyses and 

any proposed standards based on these comments and considers modifications where necessary. 

 

4 All materials associated with the rulemakings for BVM test procedures and energy conservation standards will be 

available on DOE’s website at: 

http://www1.eere.energy.gov/buildings/appliance_standards/rulemaking.aspx/ruleid/73
13

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

impacts of any proposed standard levels on competition to determine whether changes to these 

standard levels are needed. DOE publishes the DOJ comments and DOE’s response as part of 

any final rule.

In any final rule, DOE determines whether to amend the standards, and if such 

determination is positive, selects the final standard level based on the complete record of the 

energy conservation standards rulemaking. Any final rule establishes any final standard levels

and the compliance date, and also explains the basis for the selection of any final energy 

conservation standard levels. A final rule is accompanied by a final rule TSD.

2. ANALYSES FOR ENERGY CONSERVATION STANDARDS RULEMAKING

The purpose of the analyses in this rulemaking is to support DOE’s determination whether to 

amend the energy conservation standards for beverage vending machines. If the energy 

conservation standards are amended, these analyses ensure that DOE selects standards that 

achieve the maximum improvement in energy efficiency that is technologically feasible and 

economically justified and will result in significant energy savings, as required by EPCA. 

Economic justification includes the consideration of the seven factors set forth in EPCA (see 

section 1.6.1 of this Framework document), which encompasses economic impacts on domestic 

manufacturers and customers, national benefits including environmental impacts, issues of 

consumer utility, and impacts from any lessening of competition. 

Figure 2.1 summarizes the analytical components of the standards-setting process. The 

analyses are presented in the center column. Each analysis has a set of key inputs, which are data 

and information required for the analysis. “Approaches” are the methods that DOE will use to 

obtain key inputs and methods of analysis, which may vary depending on the information and 

analysis step in question. Some key inputs exist in public databases. DOE will also collect 

information from interested parties or others with special knowledge and develop information 

independently in support of the rulemaking. The results of each analysis are key outputs, which 

feed directly into the rulemaking. Arrows indicate the flow of information between various 

analyses. DOE ensures a consistent approach to its analyses throughout the rulemaking by 

considering each analysis as a part of the overall standards-setting framework. 
14

Figure 2.1 Flow Diagram of Analyses for the BVM Standards Rulemaking 

3. MARKET AND TECHNOLOGY ASSESSMENT

The market and technology assessment will provide information about the BVM industry 

that DOE will use throughout the rulemaking. This assessment is particularly important at the 

outset of the rulemaking to determine equipment classes and to identify potential design options 

or efficiency (or energy consumption) levels for each equipment class.
15

3.1 Market Assessment

DOE will qualitatively and quantitatively characterize the structure of the BVM industry 

and market. In the market assessment, DOE will identify and characterize the manufacturers of 

this equipment; estimate market shares and trends in the market; address regulatory and 

non-regulatory initiatives intended to improve the energy efficiency or reduce the energy 

consumption of the beverage vending machines covered under this rulemaking; and explore the 

potential for technological improvements in the design and manufacturing of such equipment.

This market assessment will establish the context for this rulemaking, and it will serve as 

a resource to guide the analyses that follow. For example, DOE may use historical shipments and 

prices as indicators of future shipments and prices. Similarly, DOE plans to use market structure 

data for the MIA, data that will be particularly useful for assessing competitive impacts. This 

phase also allows DOE to start updating design options by reviewing equipment literature and 

industry publications. The National Automatic Merchandising Association (NAMA) is the trade 

association for manufacturers of equipment covered under this rulemaking, and the American 

Beverage Association (ABA) is the trade association for the bottlers and syrup companies in the 

beverage industry. DOE expects that NAMA and ABA could play a critical role in providing 

market information, including input on characterizing current and historical trends in equipment 

shipments and energy efficiency. This type of data is an important input for analyses that 

determine whether any amended energy conservation standards are economically justified and 

will result in significant energy savings.

DOE encourages interested parties to submit data that will improve DOE’s understanding 

of the beverage vending machine market. DOE aggregates data provided by manufacturers and 

other organizations for use in its analyses.

Item 3-1 DOE seeks information that would contribute to the market assessment (e.g., 

the manufacturers of this equipment in the United States and the equipment 

they sell, by equipment class). It is particularly important that DOE be aware 

of the major and small/niche manufacturers.

Item 3-2 DOE seeks information on historical annual equipment shipments (both 

domestic and imports) by equipment class and the corresponding efficiency 

distributions of these shipments. 

Item 3-3 DOE seeks information on the proportion of new equipment shipped annually

that replaces existing equipment, for each equipment class.

3.2 Overview of Beverage Vending Machines

Refrigerated bottled or canned beverage vending machines can be divided into categories 

in several ways: physical divisions based on door type (opaque or transparent) or beverage 

storage system (stack or shelves), machine-use designation (indoor/outdoor use or indoor-useonly), cooling mechanism (zone-cooled or fully cooled), and the types of products dispensed. In 

the 2009 BVM final rule, DOE established three equipment classes: Class A, Class B, and 

combination beverage vending machines. While equipment in the combination vending machine 

class by definition contains separate refrigerated and non-refrigerated volumes, Class A and 

Class B equipment do not contain separate, non-refrigerated volumes. In Class A beverage 
16

vending machine machines, all items are fully cooled to the same temperature at which they will 

be dispensed. Class B equipment consists of machines in which not all the items are fully cooled 

to the vending temperature. 74 FR at 44924 (Aug. 31, 2009). Combination vending machines are 

equipment that also has non-refrigerated volumes for the purpose of vending other, non-“sealed 

beverage” merchandise. 74 FR at 44920 (Aug. 31, 2009). The criteria, detailed definitions, and 

corresponding applicable standards for these equipment classes are further discussed in section 

3.3. 

Another method of classifying beverage vending machines, aside from the coolingmethod distinction used in the 2009 BVM final rule, is by the nature of their fronts—transparent 

or opaque. Transparent-front vending machines store items on shelves, allowing products 

contained within to be visible to the consumer. Some models have the capacity to display dozens 

of varieties of products. Product packaging is not limited to cans and bottles, but may also 

include cartons, juice packs, and non-standard bottle and can shapes. With the market increasing 

for non-carbonated soft drinks such as energy drinks, fruit juices, and water (which come in a 

variety of packaging types and sizes), the design of transparent-front machines provides more 

flexibility than stack-style opaque-front machines (described later in this section). Products are 

dispensed mechanically, with many machines using a mechanism to move the product to the 

door gently rather than dropping it from the upper shelves.

Most transparent-front machines are intended to be used indoors because their transparent 

fronts make them vulnerable to vandalism. In addition, transparent-front machines could 

experience additional heat flux through the transparent front due to solar heat gain and solar 

radiation if placed outdoors. However, some transparent-front machines have been made to 

withstand outdoor conditions. All transparent-front machines that DOE is currently aware of in 

the U.S. market are “fully cooled” such that all products contained within them are at the 

vending temperature, and are, therefore, considered Class A. 

Unlike transparent-front beverage vending machines, opaque-front beverage vending 

machines hold standard-sized sealed containers, usually 12-ounce cans or 20-ounce bottles, 

stored in stacks. Capacity varies, with larger machines holding up to 800 cans split between up to 

12 varieties of beverage (through 12 distinct beverage stacks or columns) internally and featuring 

up to 30 cubic feet of refrigerated volume. Opaque-front machines comprise the majority of 

vending machines placed outdoors, and many are placed indoors as well. The products contained 

are typically advertised on the front via signage or a backlit panel and the actual machine 

contents are not visible to the user. Some opaque-door models feature a “live display” door type, 

where a sample of the product that may or may not be refrigerated is visible to the consumer 

through a small window. These “live-display” machines represent a small fraction of the total 

market.

Zone-cooled machines, which belong to the Class B equipment class, typically have 

opaque fronts and feature “stack-style” vending mechanism. In this type of equipment, 

refrigerated air is directed at a fraction (or zone) of the refrigerated volume. This cooling method 

is used to ensure that some beverages in the lower part of the machine, which will be vended 

sooner, are fully cooled to the vending temperature, while maintaining beverages in other areas 

of the machine at higher temperatures. This reduces the refrigeration power needed and thus 

lessens the energy consumption of the unit. 
17

Combination vending machines, which belong to the third equipment class defined in the 

2009 BVM final rule, are refrigerated beverage vending machines that also have non-refrigerated 

volumes to hold other, non-“sealed beverage” merchandise. Combination vending machines 

were determined in the 2009 BVM final rule to have much lower shipment volumes than either 

Class A or Class B machines. Though combination machines are a class of beverage vending 

machines, DOE did not have the data needed to estimate either the energy efficiency 

improvement potential or the cost of more-efficient designs of combination vending machines. 

As a result, no standard was set for combination vending machines in the 2009 BVM final rule. 

74 FR at 44919-20 (Aug. 31, 2009). As part of the current rulemaking, DOE is considering 

performing an analysis of the energy savings potential of combination vending machines.

Item 3-4 DOE requests comment on whether all transparent-front beverage vending 

machines currently available on the market are fully cooled.

Item 3-5 DOE requests comment on whether all opaque-front beverage vending 

machines currently available on the market are zone cooled.

Item 3-6 DOE requests information on perishable items in beverage vending machines. 

Do machines that sell perishable and non-perishable items (in addition to or 

including beverages) ship with different software or controls? Are they rated 

differently, such as to food safety specifications? What portion of the BVM 

market is composed of machines that sell perishable items?

3.3 Equipment Classes

When evaluating and establishing energy conservation standards, DOE creates equipment 

classes based on the type of energy used, capacity, or other performance-related features that 

affect efficiency. Additionally, DOE must consider such factors as utility to the consumer or 

others deemed appropriate in setting standards for separate equipment classes. (42 U.S.C. 

6295(q)) 

In the 2009 BVM final rule, DOE determined that the most significant criterion affecting 

beverage vending machine energy use is the method used to cool beverages. Using this criterion, 

DOE divided covered equipment into two equipment classes:

Class A: a refrigerated bottled or canned beverage vending machine that is fully cooled, 

and is not a combination vending machine.

Class B: any refrigerated bottled or canned beverage vending machine not considered to 

be Class A, and is not a combination vending machine.

In addition, DOE interprets EPCA’s definition in 42 U.S.C. 6291(40) for beverage 

vending machines to cover any vending machine that dispenses at least one type of refrigerated 

bottled or canned beverage, regardless of the other types of vended products (some of which may 

not be refrigerated). In the 2009 BVM final rule, DOE concluded that combination vending 

machines have a distinct utility and, accordingly, established a third equipment class to cover 

combination vending machines. As noted above, however, DOE did not establish standards for 

this equipment class in that rule. 74 FR at 44919–20 (Aug. 31, 2009). So that interested parties
18

understand what constitutes a combination vending machine, DOE established the following 

definition: 

Combination vending machine: a refrigerated bottled or canned beverage vending 

machine that also has non-refrigerated volumes for the purpose of vending other, 

non-“sealed beverage” merchandise.

As part of the current rulemaking, DOE will evaluate the three equipment classes 

established in the 2009 BVM final rule and determine whether modifications should be made to 

the classes in conjunction with any potential new or amended standards. 

In the 2009 BVM final rule, DOE did not provide a definition for the term “fully-cooled.” 

In the current rulemaking DOE is considering the following definition:

Fully-cooled beverage vending machine: a refrigerated bottled or canned 

beverage vending machine within which each item in the beverage vending 

machine is brought to and stored at temperatures that fall within plus or minus 2 

°F of the average beverage temperature, which is the average of the temperatures 

of all the items in the next-to-be-vended position for each selection.

DOE is aware that certain beverage vending machines feature low-power modes in which 

the machines maintain the refrigerated product at a higher temperature than they would during 

normal-mode operation. Such low-power modes are typically meant to be activated during off 

hours when customer traffic is expected to be negligible and when the product being refrigerated 

is non-perishable. If such low-power modes are taken into consideration and accounted for in the 

DOE test procedure (as described in section 1.6.2), a distinction may need to be made between 

beverage vending machines that vend only non-perishable items (including or in addition to 

beverages) and those that also vend perishable items (including or in addition to beverages). This 

is because machines vending perishable goods could not utilize a mode allowing product 

temperatures to rise above levels required for food safety purposes. Because of this, DOE may 

choose to treat beverage vending machines designed to vend perishable products as a separate 

equipment class. 

DOE notes that equipment designed for vending perishable items could modulate the 

temperature of the non-perishable beverage portion of the equipment, while not increasing the 

temperature of the section of the equipment designed to hold perishable items. DOE could 

consider test procedures for beverage vending machines that vend some perishable products that 

account for the “perishable product volume” and “non-perishable product volume” separately. 

Item 3-7 DOE seeks comment on the equipment classes for beverage vending 

machines, and on the criteria used in creating the classes. Are the equipment 

classes appropriate? Are there other factors that should be considered in 

equipment class distinctions and definitions?

Item 3-8 DOE seeks comment regarding the possible use of alternative equipment 

classes in this rulemaking. Specifically, are there other equipment 

characteristics that should be considered for equipment class distinctions and 

definitions?
19

Item 3-9 DOE seeks comment on the proposed definition of “fully cooled vending 

machine.” Does the current language reflect what is used in industry? 

Item 3-10 DOE requests comment on the creation of a new equipment class for 

machines that are manufactured and sold to vend perishable items (including 

or in addition to beverages). How should DOE define equipment sold to vend 

perishable items? Does this equipment obtain other certifications for vending 

perishable items? Is it common for beverage vending machines to vend both 

perishable and non-perishable items? Is the same beverage vending machine 

offered to vend both perishable and non-perishable items (i.e., the equipment 

is not currently differentiated in the marketplace)? 

3.4 Technology Assessment

The technology assessment centers on understanding how equipment uses energy and 

what measures can reduce energy consumption of beverage vending machines. Measures that 

could potentially improve the energy efficiency of equipment are called “technology options,” 

and they are based on existing technologies as well as working prototypes. In consultation with 

interested parties, DOE intends to develop a list of technology options that should be considered 

in the analysis. 

In recent years, new technological developments have emerged that are applicable to 

beverage vending machines. DOE is aware of, for example, a move away from 

hydrofluorocarbon (HFC) refrigerants toward natural refrigerants such as hydrocarbons (HCs) 

and carbon dioxide (CO2), the incorporation of touch-screen interfaces, increasing inclusion of 

low-power modes of operation by equipment manufacturers, reduced cost of electronic 

components, and greater use of variable-speed compressor and permanent magnet motors. 

DOE could consider various low-power modes as design options. Low-power modes 

could include lighting low-power modes in which lights are dimmed or turned off, refrigeration 

low-power modes in which beverage temperatures are allowed to rise to 40 °F or higher, and 

whole machine low-power modes where both features are employed. Refrigeration and whole 

machine low-power modes may not be options for beverage vending machines that sell 

perishable products such as milk and fresh juices due to food safety requirements. If low-power 

modes incorporating increased product temperatures are considered as a design option, DOE 

could consider creation of a new equipment class for equipment that is sold to vend perishable 

items (in addition to or including beverages), to acknowledge the fact that these units’ maximum 

temperatures are dictated by food safety requirements and they may not be able to take 

advantage of a low-power refrigeration mode of operation. 

DOE is studying technology options by reviewing manufacturer catalogs, recent trade 

publications, technical journals, and patent filings. DOE also intends to consult with technical 

experts within the field and to conduct manufacturer interviews about these technology options. 

For the preliminary analysis, DOE is currently considering the specific technologies and designs 

listed below.

The following technologies and designs are relevant to all of the equipment classes listed 

above:

higher efficiency signage lighting (e.g., light-emitting diodes);
20

higher efficiency lighting ballasts (e.g., electronic ballasts);

remote lighting ballast location (i.e., outside the refrigerated space);

higher efficiency expansion valves (e.g., dual-port thermostatic expansion valves and 

electronic expansion valves);

higher efficiency evaporator fan motors (e.g., electronically commutated motors 

(ECMs));

increased evaporator surface area or efficiency to achieve lower machine-evaporator 

temperature differential (with a possible increase in fan energy);

evaporator-fan-motor controllers;

higher efficiency evaporator fan blades;

low-pressure-differential evaporators;

anti-sweat heater controls;

machine-insulation thickness increases or improved insulating materials, such as 

vacuum insulated panels or aerogels;

defrost mechanism (e.g., hot-gas defrost);

defrost-cycle control (e.g., partially or fully demand-based defrost rather than 

partially or fully time-based defrost);

higher efficiency compressors; 

variable-speed compressors;

suction line heat exchangers (subcool liquid refrigerant with suction line);

increased condenser surface area or efficiency to achieve lower ambient-condenser 

temperature differential;

higher efficiency condenser fan motors (e.g., ECMs);

condenser-fan-motor controllers; 

higher efficiency condenser fan blades;

lighting controls, timers, and/or sensors; and 

low-power modes incorporating refrigeration controls, timers, and/or sensors.

Item 3-11 DOE requests comment on whether any technologies or designs should be 

added to or removed from the above list. For example, do any of the 

technologies above raise issues with proprietary designs or issues where 

testing pursuant to the DOE test procedure does not reflect a change in 

measured energy efficiency?

Item 3-12 DOE requests comments, recommendations, and data on max-tech levels for 

Class A equipment, Class B equipment, and combination vending machines.

Item 3-13 DOE requests comment on whether max-tech levels can only be achieved 

using proprietary designs or whether there are alternative design paths 

available that can achieve the same energy use level?

Item 3-14 DOE requests comment on whether any technologies or designs should be

treated individually, or be incorporated into a few standard “design 

packages.” If “design packages” are possible, how should the packages be 

assembled? DOE would develop potential standard levels based on these 

packages, but manufacturers could meet any established standards through 

the use of any design options.
21

Item 3-15 DOE requests comment on low-power modes. What types of low-power modes

are currently used in the BVM market? Are there other types of energy 

management systems about which DOE should be aware that are applicable 

to beverage vending machines?

Item 3-16 DOE requests comment on whether transparent-front machines could be 

designed with zone cooling.

3.5 Baseline Units

Once DOE has established equipment classes, it will select baseline models as reference 

points for each equipment class, against which it can measure changes resulting from energy 

conservation standards. The baseline models in each equipment class represent the characteristics 

of equipment in that class. Typically, a baseline model would be a model that just meets current 

required energy conservation standards. For equipment covered by conservation standards in the 

2009 BVM final rule, DOE will select baseline models that are minimally compliant with the 

required energy conservation standards set forth in that final rule. If DOE determines it necessary 

to develop standards for equipment for which standards were not set in the 2009 BVM final rule, 

or for classes other than those specified in the 2009 BVM final rule, DOE will select baseline 

models using a different method (e.g., the unit with the highest energy consumption or a typical 

unit). DOE proposes to use information provided by stakeholders, as well as information 

available through the DOE’s Compliance Certification Management System (CCMS) in 

selecting appropriate baseline models.

Item 3-17 DOE seeks comment on how to select baseline efficiency levels for equipment 

classes without a previous energy conservation standard (e.g., combination 

machines).

Item 3-18 What machine sizes and capacities (cubic feet, vendible capacity) should be 

used as analysis points for each equipment class? 

Item 3-19 DOE seeks information on what particular components and features 

characterize the baseline model in each equipment class (materials, 

dimensions, insulation, refrigerant type, compressors, evaporators, 

condensers, expansion devices, fans, motors, anti-condensate devices and 

controls, defrost mechanisms and controls, lighting, etc.).

4. SCREENING ANALYSIS

The purpose of the screening analysis is to screen out technology options that will not be 

further analyzed in the engineering analysis. DOE will follow the process set forth below to 

screen out technology options.

DOE will use the list of technology options (developed through its own research and in 

consultation with interested parties in the technology assessment) for consideration in the 

engineering analysis (section 5). DOE will review each technology option or best available 

technology in light of the following four criteria:
22

1. Technological feasibility. DOE will screen out technologies that are not incorporated 

in commercially available equipment or working prototypes.

2. Practicability to manufacture, install, and service. If DOE determines that mass 

production of a technology in commercial equipment and reliable installation and 

servicing of the technology cannot be achieved on the scale necessary to serve the 

relevant market at the time of the effective date of the standard, it will not consider 

that technology further.

3. Adverse impacts on product or equipment utility or availability. If DOE determines a 

technology will have significant adverse impact on the utility of the equipment to 

significant customer subgroups, or would result in the unavailability of any covered 

equipment type with performance characteristics (including reliability), features, size, 

capacities, and volumes that are substantially the same as equipment generally 

available in the United States at the time, it will not be considered further.

4. Adverse impacts on health or safety. If DOE determines that a technology will have 

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

DOE will fully document its reasons for eliminating or retaining any technology options 

during the screening analysis and will publish this documentation for interested parties to review 

as part of the preliminary analysis. Those technology options not screened out by the above four 

criteria will be considered design options in the development of cost-efficiency curves in the 

engineering analysis.

Item 4-1 DOE welcomes comments on how the above four screening criteria might 

apply to any additional technology option(s) that an interested party 

recommends to DOE.

Item 4-2 DOE welcomes comments on the applicability of the four screening criteria to 

the technologies listed in section 3.4.

5. ENGINEERING ANALYSIS

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

the remaining design options. The engineering analysis consists of estimating the costs of 

equipment at various levels of increased energy efficiency or reduced energy consumption. This 

section provides an overview of the engineering analysis (section 5.1), and includes discussion of 

(1) the approach for determining the cost-efficiency relationship (section 5.2); (2) manufacturer 

prices (section 5.3); (3) proprietary designs (section 5.4); and (4) regulatory requirements outside 

the realm of DOE’s energy conservation standards program (section 5.6).

5.1 Engineering Analysis Overview

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

manufacturer selling price (MSP) and energy efficiency (energy use) for beverage vending 

machines. In determining this relationship, DOE will estimate the increase in MSP associated 

with design changes that increase the efficiency (decrease energy use) of the baseline models.
23

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

MIA) from detailed incremental cost data disaggregated into the cost of incremental material, 

labor, and overhead. DOE will create an industry-wide analysis based primarily on cost estimates 

of specific design options.

DOE seeks design and cost information to determine the cost of increasing energy 

efficiency (reducing the energy consumption) of the baseline models. In addition, DOE must 

identify the model with the highest energy efficiency (lowest energy consumption) that is 

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

Item 5-1 Within each equipment class, for energy consumption levels below the current 

standards’ baseline, DOE seeks information on daily energy consumption and 

on incremental manufacturing costs and components (differentiation in 

components from the baseline, material costs,

5

labor costs,

6

factory overhead 

costs7(excluding depreciation), building conversion capital expenditures, 

tooling/equipment conversion capital expenditures, research and development 

(R&D) expenses, marketing expenses, etc.).

Item 5-2 DOE is also interested in any equipment test data that stakeholders can 

provide (including equipment parameters, test results, etc., and, in the case 

that a test procedure other than the DOE test procedure was used, the test 

procedures used and rating conditions). Test data for the baseline model in 

each equipment class is particularly important.

5.2 Proposed Approach for Determining the Cost-Efficiency Relationship

DOE performs an engineering analysis as part of its rulemaking efforts in order to 

determine the cost-efficiency relationship for each type or class of equipment for which 

standards are being considered. This cost-efficiency relationship is a quantification of the fact 

that, in most cases, higher equipment efficiency inherently incurs a higher cost to the 

manufacturer (due to more sophisticated components or processes). Generally, this relationship 

is depicted as an output of the engineering analysis in the form of curves plotting cost as a 

function of energy efficiency for the given equipment class. DOE typically structures its 

engineering analysis using one of three approaches: (1) design-option; (2) efficiency-level; or 

(3) reverse-engineering (or cost-assessment). A design-option approach uses individual design 

options, or combinations of design options, to identify increases in efficiency. Under this 

approach, cost estimates are based on manufacturer or component supplier data or engineering 

 

5 This consists of costs of raw materials including scrap that can be traced to final or end products. Direct material 

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

but not incorporated into final products (e.g., lubricating oil for production machinery).

6 This refers to earnings of workers who assemble parts into a finished good or operate machines in the production 

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

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

directly in assembling a product such as supervisors, janitors, stockroom personnel, inspectors, and forklift 

operators.

7

Factory overhead includes indirect labor, downtime, set-up costs, indirect material, expendable tools, maintenance, 

property taxes, insurance on assets, and utility costs. Factory overhead does not include depreciation, selling, 

general, and administrative costs, R&D, interest, or profit (accounted for by DOE separately).
24

computer simulation models focused on design options. Individual design options, or 

combinations of design options, are added to the baseline model in ascending order of costeffectiveness. An efficiency-level approach establishes the relationship between manufacturer 

cost and increased efficiency at predetermined efficiency levels above the baseline. Under this 

approach, manufacturers typically provide manufacturer cost data for incremental increases in 

efficiency, without identifying the technology or design options they would use to achieve such 

increases, or cost models are prepared based on procured equipment of a known efficiency level. 

A reverse-engineering or cost-assessment approach involves purchasing representative units of 

beverage vending machines, disassembling the units into their components, and evaluating the 

manufacturing costs based on a “bottoms-up” manufacturing cost assessment of the components 

and their assembly.

In the 2009 BVM rulemaking, DOE used a design-option approach for the engineering 

analysis. DOE plans to continue using this approach for this rulemaking. The design option 

approach will involve consultation with industry experts, review of publicly available cost and 

performance information, and modeling of equipment costs and energy consumption. DOE 

believes that the design option approach, where modeling is used to simulate implementation of 

specific energy-efficient features, lends itself best to this equipment type. This is due to the fact 

that much of the equipment is built at or near the current required performance levels, and there 

is not a large range of efficiencies within the equipment currently on the market from which to 

draw trends, as would be needed for an efficiency-level or pure reverse-engineering approach. 

In the analyses for the 2009 BVM final rule, Class A beverage vending machines were 

modeled as having transparent fronts and Class B beverage vending machines were modeled as 

having opaque fronts. 

For each equipment class, the engineering analysis will be used to estimate manufacturer 

production cost of equipment at each efficiency level considered. DOE plans to use a cost model 

to estimate the cost of the case, refrigeration system, lighting, and other system components. A

cost model was developed for the 2009 BVM rulemaking and will be updated for the current 

rulemaking’s engineering analysis.

Item 5-3 DOE requests feedback on the use of the design-option approach to 

determining the relationship between manufacturer selling price and energy 

efficiency for beverage vending machines.

5.3 Manufacturer Prices

DOE plans to apply markups to convert manufacturer production cost to MSPs. DOE will 

estimate manufacturer markups from publicly available financial information (e.g., Securities 

and Exchange Commission 10-K reports). This information will be adjusted later based on 

information from manufacturer interviews. 

Item 5-4 DOE seeks comment on the markup approach proposed for developing 

estimates of manufacturer selling prices.
25

5.4 Proprietary Designs

DOE considers in its engineering and economic analyses all design options that have not 

been screened out, including proprietary designs. DOE will consider proprietary designs in the 

subsequent analyses only if they are not part of a unique path to a given efficiency level. If the 

proprietary design is the only approach available to achieve a given efficiency level, DOE will 

reject that efficiency level from further analysis. Further, DOE is sensitive to manufacturer 

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

of any proprietary data submitted by manufacturers consistent with applicable law. 

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

economic analyses.

Item 5-5 Are there proprietary designs that DOE should consider for any of the 

equipment under consideration by this rulemaking? If so, how should DOE 

acquire the cost data necessary for evaluating these designs?

Item 5-6 Are there alternative design paths that can achieve the same level of max-tech 

energy use (energy efficiency) as those using proprietary designs?

5.5 Representative Sizes

In performing the engineering analysis, DOE will select equipment models from the 

range of available equipment with sizes that DOE believes best represent the most typical 

offerings within that specific equipment class. In the case where the standard level is an 

equation, i.e., function of the capacity, DOE may select multiple sizes of equipment as 

representative models in order to determine the relationship between energy use characteristics 

and equipment size within a given product class. Proper selection of representative sizes will 

allow for the analyses to accurately model the majority of available equipment. DOE plans to 

select representative sizes for each equipment class, while considering the possible design 

constraints at very small and very large capacities. For those classes already subject to standards, 

DOE plans to use the representative sizes it used in developing the 2009 BVM final rule and 

included in the 2009 BVM final rule TSD, shown in Table 5.5.1, as starting values for the 

engineering analysis in this rulemaking. For any other analysis that DOE conducts, such as the 

complete analysis for combination vending machines that is under consideration, DOE will 

select representative equipment sizes that represent the most typical offerings from within that 

equipment class.

Table 5.5.1 Representative Sizes for Beverage Vending Machines in 2009 BVM 

Rulemaking
26

Class A Class B

Small Medium Large Small Medium Large

Vendible Capacity 

number of cans 300 400 500 450 650 800

Refrigerated Volume 

ft3 17 22 34 17 22 26

Item 5-7 DOE requests feedback on representative sizes. Are the representative sizes 

used for the 2009 BVM final rule adequate, and should they be retained or 

modified?

Item 5-8 If DOE were to analyze a combination equipment class, perishables

(including or in addition to beverages) equipment class, or other new 

equipment classes, what should be the relevant representative sizes for that

class?

5.6 Outside Regulatory Changes Affecting the Engineering Analysis

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

changes outside DOE’s statutory energy conservation standards rulemaking process that can 

affect the energy efficiency or energy consumption of the covered equipment, and/or the cost of 

improving such efficiency or consumption. DOE will attempt to identify all such outside 

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

closely related to the cumulative regulatory burden assessment that DOE will carry out as part of 

the MIA. Based on consideration of the comments received for the preliminary analysis, DOE 

will make the necessary changes to the analysis. These changes will be reflected in the 

documentation of the NOPR.

One issue that may be relevant to this equipment is alternative refrigerants. DOE did not 

consider chlorofluorocarbon (CFC) or hydrochlorofluorocarbon (HCFC) refrigerants in its 

analysis for the 2009 BVM final rule, instead using HFC R-134a as the refrigerant in all 

technical analyses. Although alternative refrigerants such as HCs, ammonia, and CO2 are used in 

Europe and elsewhere, they were not used at the time of the analyses for the 2009 BVM 

rulemaking for BVM applications in the United States. 

The majority of the U.S. BVM industry currently continues to use HFC refrigerants, 

specifically R-134a, in its equipment. However, DOE is aware that beverage vending machines 

using alternative refrigerants are now available in the U.S. and that this equipment represents a 

growing portion of the market. DOE requests information from interested parties regarding the 

prevalence, cost, and energy consumption of equipment using these refrigerants.

Item 5-9 DOE requests information on the use of alternative refrigerants in beverage 

vending machines, including shipment, cost, and energy consumption 

information.

Item 5-10 Are there additional regulatory issues that DOE should consider in its 

analysis of beverage vending machines? Do the issues discussed in this 

section affect shipments, cost, or energy efficiency?
27

6. ENERGY USE ANALYSIS

The purpose of the energy use analysis is to assess the energy- and peak-demand-savings 

potential of different equipment efficiencies for various building types and across a range of 

climate zones where the equipment is used. As part of the energy use analysis, DOE must make 

certain engineering assumptions regarding equipment application, including where the 

equipment is located (outdoor versus indoor). Although many beverage vending machines are 

located inside conditioned spaces, a relatively small number of machines are installed outdoors 

or outside the conditioned space of buildings, which affects the thermal load on the beverage 

vending machines. A small number of machines installed outdoors in cold climates are equipped 

with heater kits. Characterizing the energy use of beverage vending machines is a critical part of 

the standards rulemaking analysis, as it establishes the per-unit energy-savings potential 

achievable from energy efficiency standards.

Item 6-1 How should DOE consider energy use in “heating mode” for outdoor 

machines in cold climates?

7. MARKUPS ANALYSIS

DOE uses manufacturer-to-customer markups to convert the MSP values, obtained from 

the engineering analysis, to customer purchase prices, which are then used in the LCC analysis 

and the NIA. Customer purchase prices are needed for the baseline efficiency level and all other 

efficiency levels under consideration. To quantify these markups, DOE will attempt to collect 

data on existing prices in the market (e.g., purchased data sets or distributor Internet sites), where 

collecting such data is possible and produces meaningful results.

Before it can develop markups, DOE must identify distribution channels. Once it 

identifies the major distribution channels for each equipment class, DOE will use available data 

to determine how equipment is marked up from the manufacturer to the customer. 

During the 2009 BVM final rule analysis, DOE identified the following four distribution 

channels for beverage vending machines:

1. Equipment Manufacturer  Vending Machine Operator (e.g., bottler, beverage 

distributor)

2. Equipment Manufacturer  Distributor  Vending Machine Operator

3. Equipment Manufacturer  Site Owner 

4. Equipment Manufacturer  Distributor  Site Owner

In the first distribution channel scenario, the equipment manufacturer builds the 

equipment to meet the machine performance specifications provided by a beverage company and 

sells it directly to the vending machine operator, who is either a bottler or a beverage distributor. 

The vending machine operator owns the machine, places it on-site through a “location contract,” 

maintains the machine and stocks it, and receives a certain percentage of the revenue. The site 

owner, in this case, allows the machine to be placed on-site, receives a percentage of revenue or 

other payment, and pays the electric bill. In the second scenario, the vending machine operator 
28

purchases the equipment from a distributor instead of directly from the equipment manufacturer. 

In the third scenario, a site owner (e.g., large retail store chain) may purchase the vending 

machines directly from the manufacturer. In the fourth scenario, a site owner (e.g., gas stations) 

may purchase the vending machines from a distributor. In both the third and the fourth scenarios, 

the site owner maintains and stocks the machines and earns the entire revenue.

DOE intends to use the data gathered from stakeholders to develop both baseline 

markups and incremental markups. Baseline markups will be applied to the MSP of the baseline 

equipment to determine the customer purchase price of baseline equipment. Incremental markups 

will be applied only to the cost increments (difference between MSP of baseline equipment and 

equipment at higher efficiency levels). As a result, the customer purchase price of the equipment 

at higher efficiency levels will be equal to the sum of purchase price of baseline equipment and 

the product of cost increment and incremental markup. Incremental markups will be calculated 

by assuming that certain industry costs, such as labor and building occupancy expenses, do not 

increase with an increase in cost of goods sold. DOE will develop both baseline and incremental 

markups for use in the LCC analysis.

Item 7-1 DOE requests information on the distribution channels described above for 

the beverage vending machines covered under this rulemaking. DOE also 

seeks information on other major distribution channels that DOE should be 

considering for markups analysis. DOE also requests information on the 

relative fractions of shipments expected for each channel.

Item 7-2 DOE requests information on how the overall markups for the beverage 

vending machines covered under this rulemaking may vary for each channel.

Item 7-3 DOE requests feedback on its proposal to use baseline and incremental 

markups.

Item 7-4 DOE requests comment on sources of relevant data that could be used to 

calculate markups for each distribution channel.

8. LIFE-CYCLE COST AND PAYBACK PERIOD ANALYSIS

8.1 Overview

DOE will conduct an LCC analysis to evaluate the economic impacts of amended energy 

conservation standards developed for beverage vending machines on individual commercial 

customers. The effect of standards on customers includes a change in operating cost (usually 

decreased) and a change in purchase cost (usually increased). The LCC analysis uses two metrics 

to determine the effect of the standards on customers:

Life-cycle cost. The total customer cost over the life of the equipment is the sum of 

installed costs (purchase and installation costs) and operating costs (maintenance, repair, 

and energy costs). Future operating costs are discounted to the time of purchase and 

summed over the lifetime of the equipment.
29

Payback period (PBP). Payback period is the estimated amount of time (in years) it 

would take customers to recover the higher purchase price of more-efficient equipment 

through lower operating costs.

For the LCC analysis, DOE will use the cost-efficiency relationships obtained from the 

engineering analysis and the energy consumption values obtained from the energy use analysis. 

Other inputs to the LCC analysis include the installation costs and operating expenses (energy, 

maintenance and repair costs). 

Inputs for the LCC analysis are estimated from the best available data for the market.

Where possible, DOE uses a range of values for each input (for example, the equipment lifetime, 

which can vary over a wide range).8In the NOPR stage of this rulemaking, DOE will perform

the LCC analysis in the form of Monte Carlo simulations in which certain inputs are provided a 

range of values and probability distributions. The results of the LCC analysis are presented in the 

form of mean LCC savings; percentages of customers experiencing net savings, net cost, and no 

impact in LCC; and median PBP. For each equipment class, 10,000 Monte Carlo simulations 

will be carried out. The simulations will be conducted using Microsoft Excel and Crystal Ball, a 

commercially available Excel add-in for carrying out Monte Carlo simulations.

The following sections discuss the methodologies DOE plans to use in determining the 

inputs necessary for the LCC analysis.

8.2 Energy Prices

DOE will review the U.S. Energy Information Administration’s (EIA) energy price data 

for the commercial sector as a means of establishing electricity prices. DOE typically relies on 

state-level average energy price data for the commercial sector. DOE will use projections of 

these energy prices for commercial customers to estimate future energy prices in its LCC 

analysis. DOE will use EIA’s Annual Energy Outlook (AEO) as the default source of projections 

for future energy prices.

Item 8-1 DOE seeks comment on the proposed approaches for estimating current and 

forecasted energy prices.

8.3 Life-Cycle Cost Discount Rates

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

beverage vending machines, DOE intends to use the same approach that it used for developing 

discount rates for the 2009 BVM final rule. This approach involves deriving the discount rates 

for commercial customers, in this case, the bottling companies, the vending machine operators, 

or the site owners (including government entities), by estimating the cost of capital to the 

companies that purchase the beverage vending machines covered under this rulemaking. DOE 

typically uses the cost of capital to estimate the present value of cash flows to be derived from a 

typical company project or investment. Most companies use both debt and equity capital to fund 

 

8 DOE notes that in some cases, data are available for generally accepted representative values within the industry 

rather than a range of values. Calculations based on representative values yield average or representative values for 

the LCC and PBP outputs. 
30

investments; therefore, the cost of capital to the firm is the weighted-average cost of equity and 

debt financing. For government entities, it is the rate on their debt. This corporate finance 

approach is referred to as the weighted-average cost of capital (WACC).

DOE will include for public comment in the preliminary analysis the discount rates and 

calculations associated with the LCC of beverage vending machines.

Item 8-2 DOE seeks comment on the proposed approaches for estimating discount 

rates for customers using the equipment covered under this rulemaking.

Item 8-3 DOE recognizes that a large fraction of the customers of beverage vending 

machines are beverage bottlers. Which commercial sectors besides the 

bottlers should be considered in the evaluation of discount rates? In addition, 

do stakeholders believe that government direct purchases of this equipment 

are large enough to require that they be included in the evaluation of discount 

rates?

8.4 Installation, Maintenance, and Repair Costs

Installation costs are the material and labor costs incurred by the customers to install the 

beverage vending machines. Maintenance costs are the costs incurred by the customers for 

preventative maintenance. Repair costs are the costs to repair and replace malfunctioning 

components of the beverage vending machines.

Installation cost is a one-time cost and is added to the customer equipment purchase price 

to obtain the equipment installed cost. The repair costs may and maintenance costs do occur 

several times during the lifetime of the equipment. Therefore, repair and maintenance costs are 

expressed in the form of annualized costs. 

For the calculation of LCC savings and PBP values at each efficiency level, only the 

costs that are different from the baseline level are relevant. Therefore, for the calculation of the 

repair costs, DOE accounts for those repair costs related to the design options under 

consideration for each equipment class. DOE will request input from manufacturers and other 

stakeholders in developing appropriate incremental repair and maintenance costs for higher 

efficiency equipment if stakeholders feel such estimates are necessary.

Item 8-4 DOE seeks feedback on what fraction of the installation, maintenance, and 

repairs involve efficiency improvements and what are the typical practices 

during the life cycle of an originally manufactured beverage vending machine 

(e.g., change lamps but not the compressor).

Item 8-5 What is a typical time period between the sale of a new BVM unit and the first 

maintenance or repairs? What are the typical cycles of maintenance and 

repairs? 

Item 8-6 DOE seeks feedback on whether (and how) routine maintenance, repair, and 

installation costs will change for more-efficient equipment.
31

Item 8-7 DOE seeks feedback on appropriate methodologies for assessing changes to 

maintenance, repair, and installation costs.

8.5 Equipment Lifetimes

DOE will use information from various published sources (e.g., Vending Times) and 

input from manufacturers and other stakeholders to establish average equipment lifetimes for use 

in the LCC and subsequent analyses.

A typical vending machine may undergo periodic refurbishments during its lifetime. 

Depending on the frequency of the refurbishments and their nature with regard to improvements 

in energy performance, these refurbishments may change the useful lifetime of the equipment.

Item 8-8 DOE seeks feedback on appropriate equipment lifetimes for the beverage 

vending machines covered under this rulemaking.

Item 8-9 DOE seeks comment on whether energy conservation standards will have an 

impact on lifetimes of beverage vending machines.

Item 8-10 Is there a suitable inventory model that could be used to estimate the fraction 

of new versus rebuilt/refurbished machines in the market? If no inventory 

model exists, what is the impact of refurbishment on the equipment lifetime?

DOE also seeks feedback on the number of refurbishment cycles in the typical 

lifetime of the beverage vending machines. DOE also seeks information on the 

effect of refurbishments on equipment utility and energy consumption. In a 

typical refurbishment, for example, are features added to the beverage 

vending machine that affect its utility and/or are changes made that affect the 

energy consumption of the equipment?

9. SHIPMENTS ANALYSIS

Shipment projections are required to calculate the national impacts of standards on 

energy consumption, NPV, and future manufacturer cash flows. DOE plans to develop shipment 

projections based on an analysis of key market drivers for beverage vending machines.

9.1 Base-Case Projections

To evaluate the various impacts of standards, DOE must develop a base-case projection 

against which to compare projections for higher efficiency levels. The base-case projection is 

designed to depict what will happen to energy consumption and energy costs over time if DOE 

does not adopt new or amended energy conservation standards for the equipment covered under 

this rulemaking. In determining the base-case projection, DOE will consider historical 

shipments, the mix of efficiencies sold in the absence of standards, and how that mix might 

change over time, for instance in response to known voluntary or incentive-based programs such 

as ENERGYSTAR® or utility customer rebate programs that encourage purchase of higher 

efficiency equipment. For these purposes, DOE needs data on historical shipments and the 

market shares of the different efficiency levels offered in each equipment class.
32

Vending Times reports historical shipments for beverage vending machines as an overall 

product group.9In addition, the U.S. Bureau of Census (Census Bureau) has also published 

limited statistics on the quantity and value of product shipments.10 Census Bureau data is 

available online for the years 1995, 1996, 1999, and 2000 for refrigerated soft drink vending 

machines. These data are not broken down by equipment class. The data collection was 

discontinued after the 2000 data were published, so no additional data from the Census Bureau

beyond 2000 is available.

DOE will attempt to collect shipment data and market-share efficiency data (i.e., data on 

the distribution of product shipments by efficiency) for each equipment class. DOE recognizes 

that this information may be difficult to collect, and may therefore consider using other methods 

for estimating the efficiency distribution in the market. For example, when market-share 

efficiency data are not available, DOE may use efficiency distributions based on available 

models as a proxy. DOE may also request separate shipment information for equipment sold 

with specific design features (e.g., ECM evaporator fan motors).

Item 9-1 DOE requests data on, sources of data related to, or any information 

pertaining to historical shipments and the market shares of the different 

efficiency levels offered in each equipment class.

9.2 Accounting Methodology

DOE proposes to determine annual shipments in the base case by accounting for new 

building construction and historical rates of ownership (saturation rates) in buildings. This 

method has the distinct advantage of separately accounting for units installed in new construction 

and existing buildings. More importantly, DOE can express equipment saturation rates as a 

function of customer price and operating cost to capture their impact on future shipments. DOE 

plans to rely on EIA’s AEO to forecast new commercial construction. For equipment retirements, 

DOE will use the same equipment lifetimes and retirement functions that are used for the LCC 

analysis.

DOE will also consider any other input provided by stakeholders.

Item 9-2 DOE seeks information on representative saturation rates for each equipment 

class covered under this rulemaking, as well as industry-trend data regarding 

relative growth in each equipment class.

Item 9-3 DOE seeks input on methods of projecting the markets for each equipment

class and access to models or methods that could be used to estimate 

shipments.

9.3 Standards Impacts on Shipments

For each equipment class, DOE will develop a set of shipment projections for each set of 

standards analyzed, also known as standards-case projections. These standards-case projections 

 

9

See http://www.vendingtimes.com/ME2/default.asp.

10 See http://www.census.gov/.
33

will be used to evaluate the impacts of standards on shipments. Standards-case projections are 

derived using the same datasets as base-case projections; however, because the standards-case 

projections take into account the increase in purchase price and the decrease in operating costs 

caused by standards, projected shipments may deviate from the base case. The magnitude of the 

difference between the standards-case and base-case shipment projections depends on the 

estimated purchase price increase as well as the operating cost savings caused by the standard. 

Because the purchase price tends to have a larger impact than operating cost on equipment 

purchase decisions, standards-case projections may show a drop in shipments relative to the base 

case.

DOE’s past standards analyses have attempted to quantify the sensitivity of shipments to 

purchase price and operating cost savings. Because the data required to develop these 

sensitivities are limited and often difficult to obtain, DOE will consider modeling standards-case 

shipments projections with scenarios (i.e., specified impacts to shipments) rather than developing 

sensitivities to purchase price or operating cost savings.

Market-pull programs, such as customer rebate programs that encourage the purchase of 

more-efficient equipment, ENERGYSTAR®, and manufacturer tax credits that encourage the 

production of more-efficient equipment, also affect standards-case projections. When such 

programs exist, DOE will consider their impact on the projection of both standards-case and 

base-case shipments.

Item 9-4 DOE seeks input on likely impacts on shipments due to new or amended 

standards for beverage vending machines. Please comment on what the 

possible scenarios are and the estimated quantitative impact of each scenario 

on the shipments numbers.

10. NATIONAL IMPACT ANALYSIS

Section 8 discusses methods for estimating the LCC savings and PBP for individual 

customers. This section discusses DOE’s assessment of the aggregate impacts at the national 

level. Measures of impact include NES and the NPV of total customer LCC savings.

10.1 Calculation of Energy Savings

DOE calculates the annual site-energy consumption of all the beverage vending machines 

covered under this rulemaking under the base-case scenario and the standards-case scenarios for 

each year in the analysis period. The difference in the annual site-energy consumption between 

base-case scenario and a standards-case scenario is the annual site-energy savings associated 

with that particular standards-case scenario. DOE will convert the site-energy savings into 

annual primary energy savings using a full-fuel-cycle (FFC) analysis. The sum of annual primary 

energy savings for each standards-case scenario over all the years in an analysis period gives the 

NES value for each standards-case scenario.

DOE carries out the NIA over a 30-year period starting in the compliance year of the new 

or amended standards, and the annual energy savings are summed over the lifetimes of the 

equipment installed in the 30-year period.
34

Item 10-1 DOE seeks comment on the share of the market that is met by refurbished or 

rebuilt machines. In particular, DOE seeks comment on the impact of 

refurbishment/rebuilding on the energy consumption and lifetime of the 

existing fleet in the absence of standards, and the impact of new standards on 

refurbishment kits, the subsequent cost, and performance of the stock of 

existing equipment.

Item 10-2 DOE seeks comment on its plan to develop NES spreadsheet models for 

estimating national impacts of amended energy conservation standards.

10.2 Net Present Value

DOE calculates the national NPV of the standards similar to the way in which it 

calculates the NES. DOE first calculates the annual increase in installed costs as the difference in 

installed cost of all the beverage vending machines (installed in the nation) in the base-case 

scenario and the standards-case scenarios. The annual operating cost savings are calculated in a 

similar manner. The difference between annual operating cost savings and the annual increases 

in installed costs gives the annual savings. The annual savings are calculated for each year in the 

analysis period. These savings are then discounted to the present year (year in which the analysis 

in conducted) to determine the present value of each of the future annual savings. The 

summation of these present values of future annual savings for each standards-case scenario 

gives the NPV for each standards-case scenario.

The increases in installed costs are calculated for the 30-year period starting with the 

compliance year of the new or amended standards. The operating cost savings are calculated 

over the entire lifetime of the beverage vending machines installed in the 30-year period. 

DOE will take into account comments received in response to this Framework document.

11. CUSTOMER SUBGROUP ANALYSIS

This section describes how DOE analyzes customer impacts by dividing customers into 

subgroups and accounting for variations in key inputs to the LCC analysis. A customer subgroup 

comprises a subset of the customer population that is likely to be impacted disproportionately by 

new or amended energy conservation standards. The purpose of a subgroup analysis is to 

determine the extent of this disproportionate impact. DOE will work with stakeholders early in 

the rulemaking process to identify any subgroups for this consideration. However, DOE will not 

analyze the customer subgroups until the NOPR stage of the analysis.

In comparing potential impacts on the different customer subgroups, DOE will evaluate 

variations in regional energy prices, variations in energy use, and variations in installation costs 

that might affect the LCC savings and PBP of a standard to customer subgroups. To the extent 

possible, DOE may obtain estimates of the variability in each input variable and consider this 

variability in its calculation of customer impacts. It will discuss the variability in each input 

variable and likely sources of information with stakeholders.
35

Item 11-1 DOE seeks input on which customer subgroups DOE should consider in the 

present rulemaking. Examples of possible subgroups DOE could consider 

appropriate for beverage vending machines are manufacturing facilities that 

own their own BVM units, which was the identified subgroup in the 2009 BVM 

final rule analysis, and site owners that pay the utilities but don’t own or stock 

the equipment. 

12. MANUFACTURER IMPACT ANALYSIS

The manufacturer impact analysis will assess the potential impacts of energy 

conservation standards on manufacturers of beverage vending machines. A wide range of 

quantitative and qualitative effects may occur following the adoption of amended standards that 

may require changes to manufacturing practices. DOE will identify these potential effects 

through interviews with manufacturers and other experts.

For the NOPR, DOE will conduct an industry-wide cash-flow analysis using the 

Government Regulatory Impact Model (GRIM), identify and analyze subgroups of 

manufacturers whose businesses vary significantly from the industry as a whole, perform a 

competitive impacts assessment, and review the cumulative regulatory burden for the industry.

12.1 Sources of Information

Many of the analyses described earlier provide important information that DOE uses as 

inputs for the MIA. Such information includes financial parameters developed in the market 

assessment (section 3.1), cost data from the engineering analysis (sections 5.2 and 5.3), and 

shipments projections (section 9.1). DOE supplements this data with information gathered during 

manufacturer interviews. The interview process will play a key role in the MIA, as it provides an 

opportunity for interested parties to express their views on important issues.

Navigant Consulting, Inc. (Navigant), a DOE contractor for this rulemaking, will conduct 

detailed interviews with manufacturers to gain insight into the range of potential impacts of 

standards. During the interviews, Navigant will solicit information on the possible impacts of 

standards on manufacturing costs, equipment prices, sales, direct employment, capital assets, and 

industry competitiveness. Both qualitative and quantitative information are valuable. DOE, 

through Navigant, will schedule interviews well in advance to provide every opportunity for key 

individuals to be available. DOE prefers an interactive interview process because it helps clarify 

responses and provides the opportunity for additional issues to be identified.

DOE will ask that interview participants identify all confidential information provided, 

both in writing and orally. While it will consider information gathered, as appropriate, in its 

decision-making process, Navigant will protect confidential information from disclosure 

consistent with applicable law. DOE will also ask participants to identify all information that 

they want included in the public record, but that they do not want to have associated with their 

interview. DOE will incorporate this information into the public record, but will report it without 

attribution.

Materials provided to Navigant are generally subject to the terms of the applicable 

agreement under which those materials are submitted. In the case of materials provided to 

Navigant in the context of a DOE rulemaking and subject to a non-disclosure agreement, those 
36

materials are generally not shared with DOE, apart from aggregated data that do not identify 

particular submitters. These materials may also be subject to a variety of laws and regulations 

governing the disclosure of Federal agency information. Information submitted to DOE through 

Navigant will be protected in accordance with all applicable federal laws, rules, or regulations, 

including but not limited to the Trade Secrets Act (18 U.S.C. 1905) and the Freedom of 

Information Act (FOIA; 5 U.S.C. 552), and DOE’s implementing regulations at 10 CFR part 

1004. DOE will prepare a summary of the major issues and outcomes identified during 

manufacturer interviews. This summary will become part of the technical support document 

produced for this rulemaking.

12.2 Industry Cash Flow Analysis

The industry cash flow analysis relies primarily on the GRIM. DOE uses the GRIM to 

analyze the financial impacts of more-stringent energy conservation standards on the industry 

that manufactures the equipment covered by the standard. 

The GRIM analysis uses a number of factors—annual expected revenues; costs of goods 

sold; selling, general, and administrative costs; taxes; and capital expenditures—to arrive at a 

series of annual cash flows beginning from the announcement of the standard and continuing 

through the analysis period. DOE compares the results against base-case projections that involve 

no amended standards. The financial impact of amended standards is then the difference between 

the two sets of discounted annual cash flows. Other performance metrics, such as return on 

invested capital, also are available from the GRIM.

DOE will gather inputs needed for the GRIM from two primary sources: (1) the analyses 

conducted to this point; and (2) interviews with manufacturers and other stakeholders. 

Information gathered from previous analyses will include financial parameters, manufacturing 

costs, price projections, and shipments projections. Interviews with manufacturers and other 

stakeholders will supplement this information.

12.3 Manufacturer Subgroup Analysis

Average industry cost values may not reveal differential impacts among BVM

manufacturer subgroups. Smaller manufacturers, niche players, and manufacturers exhibiting a 

cost structure that differs significantly from the industry average may be affected differently by 

amended standards. Ideally, DOE would consider the impact on every firm individually. In 

highly concentrated industries, this may be possible. However, for industries that have numerous 

participants, DOE will use the results of the market and technology assessment to group 

manufacturers into subgroups, as appropriate. For beverage vending machines, DOE is interested 

in feedback about potential subgroups, including small businesses. DOE will conduct a 

Regulatory Flexibility Act analysis to determine the impacts of any amended standards on small 

businesses consistent with the Regulatory Flexibility Act. 

Item 12-1 DOE seeks comment on appropriate manufacturer subgroups, if any, that 

DOE should consider in the manufacturer subgroup analysis for beverage 

vending machines.
37

Item 12-2 DOE seeks comment on small businesses that could be impacted by amended 

energy conservation standards for beverage vending machines, and what 

those impacts might entail.

12.4 Competitive Impacts Assessment

EPCA directs DOE to consider any lessening of competition that is likely to result from 

the imposition of standards. (42 U.S.C. 6295(o)(2)(B)(i)(V)) It further directs the Attorney 

General to determine in writing the impacts, if any, of any lessening of competition. (42 U.S.C. 

6295(o)(2)(B)(ii)) 

DOE will make a determined effort to gather firm-specific financial information and 

impacts, and to report the anticipated aggregate impact of amended standards on manufacturers. 

The competitive impacts assessment will focus on assessing the impacts on smaller 

manufacturers. DOE will base the assessment on manufacturing cost data and on information 

collected from interviews with manufacturers. The manufacturer interviews will focus on 

gathering information that would help in assessing asymmetrical cost increases to some 

manufacturers, increased proportion of fixed costs potentially increasing business risks, and 

potential barriers to market entry (e.g., proprietary technologies). DOE will provide the Attorney 

General with a copy of any NOPR for consideration in its evaluation of the impact of amended 

standards on the lessening of competition. DOE will publish the Attorney General’s letter and 

address any related comments in the final rule.

12.5 Cumulative Regulatory Burden

DOE is aware that other regulations (Federal, State, local, or international) may apply to 

manufacturers of beverage vending machines covered under this rulemaking and to other 

equipment made by these manufacturers. Multiple regulations may result in a significant

cumulative regulatory burden on these manufacturers. DOE will consider the impact of multiple, 

product-specific regulatory actions on these manufacturers.

Item 12-3 DOE welcomes comments on other existing or pending regulations it should 

consider in its examination of cumulative regulatory burden.

13. EMPLOYMENT IMPACT ANALYSIS

The imposition of standards can impact employment both directly and indirectly. Direct 

employment impacts are changes in the number of employees at the plants that produce the 

covered equipment. DOE will evaluate direct employment impacts in the MIA, as described in 

section 12. 

Indirect employment impacts may result from expenditures shifting between goods (the 

substitution effect) and changes in income and overall expenditure levels (the income effect) that 

occur due to the imposition of standards. The short-term (5-year) combined direct and indirect 

employment impacts will be investigated in the employment-impact analysis using Pacific 

Northwest National Laboratory’s Impact of Sector Energy Technologies (ImSET) model. The 

ImSET model was developed for DOE’s Office of Planning, Budget, and Analysis, and estimates 

the employment and income effects of energy-saving technologies in buildings, industry, and 
38

transportation. In comparison with simple economic multiplier approaches, ImSET allows for 

more complete and automated analysis of the economic impacts of energy conservation 

investments. DOE believes that the complexity of potential adjustments in the U.S. economy 

largely negates the value of long-term projections of indirect employment impacts.

Item 13-1 DOE requests feedback on this approach to assessing employment impacts.

14. UTILITY IMPACT ANALYSIS

The utility impact analysis will include an analysis of the impact of new and amended 

standards on electric utility industry. DOE will adapt the National Energy Modeling System 

(NEMS) produced by the EIA for this analysis. NEMS is a large, multi-sectoral, partialequilibrium model of the United States energy sector that has been developed over the past 

decade by the EIA, primarily for the purpose of preparing DOE’s AEO. In prior rulemakings, a 

variant of NEMS (currently identified as NEMS-BT, where BT refers to the DOE Building 

Technologies Program) was developed to better address the particular impacts of an energy 

efficiency standard for commercial equipment.

The NEMS produces a widely recognized baseline energy forecast for the United States 

through the year 2035, and is available in the public domain. The typical NEMS outputs include 

forecasts of electricity sales, price, and avoided capacity. DOE plans to conduct the utility impact 

analysis as a scenario departing from the latest AEO reference case. In other words, the energy 

savings impacts from amended energy conservation standards will be modeled using NEMS-BT 

to generate forecasts that deviate from the AEO reference case.

Item 14-1 DOE seeks input on its proposed use of NEMS-BT to conduct the utility 

impact analysis.

Item 14-2 Should DOE consider using methods other than NEMS in the utility impact 

analysis?

15. EMISSIONS ANALYSIS

In the emissions analysis, DOE will estimate the reduction in power sector emissions of 

CO2, nitrogen oxides (NOX), sulfur dioxide (SO2), and mercury (Hg) from potential energy 

conservation standards for BVM equipment. In addition, DOE will estimate emissions impacts in 

production activities (extracting, processing, and transporting fuels) that provide the energy 

inputs to power plants. These are referred to as “upstream” emissions. Together, these emissions 

account for the FFC. In accordance with DOE’s FFC Statement of Policy (76 FR 51282 (Aug. 

18, 2011)), the FFC analysis includes impacts on emissions of methane (CH4) and nitrous oxide

(N2O), both of which are recognized as greenhouse gases (GHGs).

DOE will conduct the emissions analysis using emissions factors derived from data in the 

latest version of EIA’s AEO, supplemented by data from other sources. EIA prepares the AEO

using NEMS. Each annual version of NEMS incorporates the projected impacts of existing air 

quality regulations on emissions. The text below refers to AEO2012.
39

SO2 emissions from affected electric generating units (EGUs) are subject to nationwide 

and regional emissions cap and trading programs. Title IV of the Clean Air Act sets an annual 

emissions cap on SO2 for affected EGUs in the 48 contiguous States and the District of Columbia 

(D.C.). SO2 emissions from 28 eastern States and D.C. were also limited under the Clean Air 

Interstate Rule (CAIR), which created an allowance-based trading program that operates along 

with the Title IV program in those States and D.C. 70 FR 25162 (May 12, 2005). CAIR was 

remanded to the U.S. Environmental Protection Agency (EPA) by the U.S. Court of Appeals for 

the District of Columbia Circuit (D.C. Circuit), but it remains in effect. See North Carolina v. 

EPA, 550 F.3d 1176 (D.C. Cir. 2008); North Carolina v. EPA, 531 F.3d 896 (D.C. Cir. 2008). 

On July 6, 2011 EPA issued a replacement for CAIR, the Cross-State Air Pollution Rule 

(CSAPR; also known as the Transport Rule). 76 FR 48208 (Aug. 8, 2011). The AEO2012 NEMS 

assumes the implementation of the CSAPR.11

The attainment of emissions caps is typically flexible among EGUs and is enforced 

through the use of emissions allowances and tradable permits. Under existing EPA regulations, 

any excess SO2 emissions allowances resulting from the lower electricity demand caused by the 

adoption of an efficiency standard could be used to permit offsetting increases in SO2 emissions 

by any regulated EGU. In past rulemakings, DOE recognized that there was uncertainty about 

the effects of efficiency standards on SO2 emissions covered by the existing cap-and-trade 

system, but it concluded that no reductions in power sector emissions would occur for SO2 as a 

result of standards.

Beginning in 2015, however, SO2 emissions will fall as a result of the Mercury and Air 

Toxics Standards (MATS) for power plants, which were announced by EPA on December 21, 

2011. 77 FR 9304 (Feb. 16, 2012). In the final MATS rule, EPA established a standard for 

hydrogen chloride as a surrogate for acid gas hazardous air pollutants (HAP), and also 

established a standard for SO2 (a non-HAP acid gas) as an alternative equivalent surrogate 

standard for acid gas HAP. The same controls are used to reduce HAP and non-HAP acid gas; 

thus, SO2 emissions will be reduced as a result of the control technologies installed on coal-fired 

power plants to comply with the MATS requirements for acid gas. AEO2012 assumes that, in 

order to continue operating, coal plants must have either flue gas desulfurization or dry sorbent 

injection systems installed by 2015. Both technologies, which are used to reduce acid gas 

emissions, also reduce SO2 emissions. Under the MATS, NEMS shows a reduction in SO2

emissions when electricity demand decreases (e.g., as a result of energy efficiency standards). 

Emissions will be far below the cap that would be established by CSAPR, so it is unlikely that 

excess SO2 emissions allowances resulting from the lower electricity demand would be needed 

or used to permit offsetting increases in SO2 emissions by any regulated EGU. Therefore, DOE 

believes that efficiency standards will reduce SO2 emissions in 2015 and beyond.

CSAPR established a cap on NOX emissions in eastern States and the District of 

Columbia. Energy conservation standards are expected to have little or no physical effect on 

 

11 On December 30, 2011, the D.C. Circuit stayed the new rules while a panel of judges reviews them, and told EPA 

to continue administering CAIR (see EME Homer City Generation v. EPA, No. 11-1302, Slip Op. at *2 (D.C. Cir. 

Dec. 30, 2011)). On August 21, 2012, the D.C. Circuit issued a decision to vacate CSAPR. See EME Homer City 

Generation, LP v. EPA, No. 11-1302, 2012 WL 3570721 at *24 (D.C. Cir. Aug. 21, 2012). The court again ordered 

EPA to continue administering CAIR. AEO2012 had been finalized prior to this decision, however. DOE 

understands that CAIR and CSAPR are similar with respect to their effect on emissions impacts of energy efficiency 

standards.
40

these emissions in those States covered by CSAPR because excess NOX emissions allowances 

resulting from the lower electricity demand could be used to permit offsetting increases in NOX

emissions. However, standards would be expected to reduce NOX emissions in the States not 

affected by CSAPR. Therefore, DOE estimates NOX emissions reductions from potential 

standards in the States where emissions are not capped.

The MATS limit mercury emissions from power plants, but they do not include emissions 

caps and, as such, DOE’s energy conservation standards would likely reduce Hg emissions. 

Power plants may emit particulates from the smoke stack, which are known as direct 

particulate matter (PM) emissions. NEMS does not account for direct PM emissions from power 

plants. DOE is investigating the possibility of using other methods to estimate reduction in PM 

emissions due to standards. The great majority of ambient PM associated with power plants is in 

the form of secondary sulfates and nitrates, which are produced at a significant distance from 

power plants by complex atmospheric chemical reactions that often involve the gaseous 

emissions of power plants, mainly SO2 and NOX. The monetary benefits that DOE estimates for 

reductions in SO2 and NOX emissions resulting from standards are in fact primarily related to the 

health benefits of reduced ambient PM. 

Item 15-1 DOE seeks input on its approach to conduct the emissions analysis for the 

equipment covered by this rulemaking.

16. MONETIZING REDUCED CO2 AND OTHER EMISSIONS

DOE plans to consider the estimated monetary benefits likely to result from the reduced 

emissions of CO2 and NOX that are expected to result from each of the standard levels 

considered.

In order to estimate the monetary value of benefits resulting from reduced emissions of 

CO2, DOE plans to use the most current Social Cost of Carbon (SCC) values developed and/or 

agreed to by an interagency process. The SCC is intended to be a monetary measure of the 

incremental damage resulting from GHG emissions, including, but not limited to, net agricultural 

productivity loss, human health effects, property damage from sea level rise, and changes in 

ecosystem services. Any effort to quantify and to monetize the harms associated with climate 

change will raise serious questions of science, economics, and ethics. But with full regard for the 

limits of both quantification and monetization, the SCC can be used to provide estimates of the 

social benefits of reductions in GHG emissions. 

At the time of this Framework document, the most recent interagency estimates of the 

potential global benefits resulting from reduced CO2 emissions in 2015, expressed in 2012$, 

were $6.2, $25.9, $41.7, and $79.1 per metric ton avoided. For emissions reductions that occur in 

later years, these values grow in real terms over time. Additionally, the interagency group 

determined that a range of values from 7 percent to 23 percent should be used to adjust the global 

SCC to calculate domestic effects, although DOE will give preference to consideration of the 

global benefits of reducing CO2 emissions. To calculate a present value of the stream of 

monetary values, DOE will discount the values in each of the four cases using the discount rates 

that had been used to obtain the SCC values in each case.
41

DOE recognizes that scientific and economic knowledge continues to evolve rapidly as to 

the contribution of CO2 and other GHG to changes in the future global climate and the potential 

resulting damages to the world economy. Thus, these values are subject to change. 

DOE also estimates the potential monetary benefit of reduced NOX emissions resulting 

from the standard levels it considers. For NOX emissions, available estimates suggest a very wide 

range of monetary values, ranging from $468 to $4,809 per ton in 2012$.12 In accordance with 

Office of Management and Budget (OMB) guidance, DOE conducts two calculations of the 

monetary benefits derived using each of the economic values used for NOX, one using a real 

discount rate of 3 percent and another using a real discount rate of 7 percent.13

DOE is investigating appropriate valuation of Hg emissions. Whether monetization of 

reduced Hg emissions will occur in this rulemaking is not yet certain.

Item 16-1 DOE requests comments on the approach it plans to use for estimating 

monetary values associated with emissions reductions.

17. REGULATORY IMPACT ANALYSIS

Pursuant to section 6(a)(3) of Executive Order 12866, “Regulatory Planning and 

Review,” 58 FR 51735 (Oct. 4, 1993), if DOE determines that amended energy conservation 

standards for beverage vending machines constitute a significant regulatory action, during the 

NOPR stage DOE will prepare and submit to OMB: (1) an assessment of the costs and benefits 

of the proposed regulation, and (2) if the proposed rule is also significant under section 3(f)(1) of 

the E.O. 12866, a Regulatory Impact Analysis (RIA) which is subject to review under the 

Executive Order by the Office of Information and Regulatory Affairs (OIRA) at the OMB. The 

RIA will address the potential for non-regulatory approaches to supplant or augment energy 

conservation standards to improve the energy efficiency or reduce the energy consumption of the 

beverage vending machines covered under this rulemaking in the market.

DOE recognizes that voluntary or other non-regulatory efforts by manufacturers, utilities, 

and other interested parties can result in substantial improvements to energy efficiency or 

reductions in energy consumption. DOE intends to consider the likely effects of non-regulatory 

initiatives such as the ENERGY STAR program on equipment energy use, customer utility, and 

LCC. DOE will base its assessment on the actual impacts of any such initiatives to date, but also 

will consider information presented regarding the impacts that any existing initiative might have 

in the future.

Item 17-1 DOE is aware of the existing ENERGY STAR program for the beverage 

vending machine industry covered under this rulemaking. Are stakeholders 

aware of any other such programs that should be examined as optional, nonregulatory approaches?

 

12 For additional information, refer to U.S. Office of Management and Budget, Office of Information and Regulatory 

Affairs, 2006 Report to Congress on the Costs and Benefits of Federal Regulations and Unfunded Mandates on 

State, Local, and Tribal Entities, Washington, DC.

13 OMB, Circular A-4: Regulatory Analysis (Sept. 17, 2003).
42

Item 17-2 Are there specific subgroups of end-users whom DOE should consider in its 

review of potential adverse impacts from standards developed under this 

rulemaking?
43

APPENDIX A – LIST OF ITEMS FOR COMMENT

Item 1-1 DOE requests comment regarding adoption of updated test procedure for the 

beverage vending machines covered under this rulemaking. .................................. 10

Item 1-2 DOE requests comment on the possible elimination of the requirement to test units 

at 90 °F..................................................................................................................... 10

Item 1-3 DOE requests comment regarding a requirement of measurement of product 

temperatures at other than the next-to-vend positions. ............................................ 10

Item 1-4 DOE requests comment on the current utilization of low-power modes in 

certification testing. Do any current models meet the requirements of the current 

test procedure regarding energy management controls and utilize a low-power mode 

during the test?......................................................................................................... 10

Item 1-5 DOE requests comment on the testing of low-power modes in a revised test 

procedure. What are the typical functions of low-power mode in beverage vending 

machines? Are these low-power modes triggered by scheduled timers, activity, 

motion sensors, or other environment or state changes? What lengths of time should 

DOE consider for the full-power mode and low-power mode?............................... 10

Item 1-6 DOE requests comment on the applicability of the current test procedure, and all 

test procedure modifications under consideration, to combination vending 

machines. ................................................................................................................. 10

Item 1-7 DOE requests comment on its proposal to consider modifications to the test 

procedure to account for energy management systems. .......................................... 10

Item 3-1 DOE seeks information that would contribute to the market assessment (e.g., the 

manufacturers of this equipment in the United States and the equipment they sell, 

by equipment class). It is particularly important that DOE be aware of the major and 

small/niche manufacturers. ...................................................................................... 15

Item 3-2 DOE seeks information on historical annual equipment shipments (both domestic 

and imports) by equipment class and the corresponding efficiency distributions of 

these shipments. ....................................................................................................... 15

Item 3-3 DOE seeks information on the proportion of new equipment shipped annually that 

replaces existing equipment, for each equipment class. .......................................... 15

Item 3-4 DOE requests comment on whether all transparent-front beverage vending 

machines currently available on the market are fully cooled. ................................. 17

Item 3-5 DOE requests comment on whether all opaque-front beverage vending machines 

currently available on the market are zone cooled................................................... 17

Item 3-6 DOE requests information on perishable items in beverage vending machines. Do 

machines that sell perishable and non-perishable items (in addition to or including 

beverages) ship with different software or controls? Are they rated differently, such 

as to food safety specifications? What portion of the BVM market is composed of 

machines that sell perishable items? ........................................................................ 17

Item 3-7 DOE seeks comment on the equipment classes for beverage vending machines, and 

on the criteria used in creating the classes. Are the equipment classes appropriate? 

Are there other factors that should be considered in equipment class distinctions and 

definitions?............................................................................................................... 18

Item 3-8 DOE seeks comment regarding the possible use of alternative equipment classes in 

this rulemaking. Specifically, are there other equipment characteristics that should 

be considered for equipment class distinctions and definitions? ............................. 18
44

Item 3-9 DOE seeks comment on the proposed definition of “fully cooled vending machine.” 

Does the current language reflect what is used in industry?.................................... 19

Item 3-10 DOE requests comment on the creation of a new equipment class for machines that 

are manufactured and sold to vend perishable items (including or in addition to 

beverages). How should DOE define equipment sold to vend perishable items? 

Does this equipment obtain other certifications for vending perishable items? Is it 

common for beverage vending machines to vend both perishable and nonperishable items? Is the same beverage vending machine offered to vend both 

perishable and non-perishable items (i.e., the equipment is not currently 

differentiated in the marketplace)? .......................................................................... 19

Item 3-11 DOE requests comment on whether any technologies or designs should be added to 

or removed from the above list. For example, do any of the technologies above raise 

issues with proprietary designs or issues where testing pursuant to the DOE test 

procedure does not reflect a change in measured energy efficiency?...................... 20

Item 3-12 DOE requests comments, recommendations, and data on max-tech levels for Class 

A equipment, Class B equipment, and combination vending machines.................. 20

Item 3-13 DOE requests comment on whether max-tech levels can only be achieved using 

proprietary designs or whether there are alternative design paths available that can 

achieve the same energy use level? ......................................................................... 20

Item 3-14 DOE requests comment on whether any technologies or designs should be treated 

individually, or be incorporated into a few standard “design packages.” If “design 

packages” are possible, how should the packages be assembled? DOE would 

develop potential standard levels based on these packages, but manufacturers could 

meet any established standards through the use of any design options. .................. 20

Item 3-15 DOE requests comment on low-power modes. What types of low-power modes are 

currently used in the BVM market? Are there other types of energy management 

systems about which DOE should be aware that are applicable to beverage vending 

machines?................................................................................................................. 21

Item 3-16 DOE requests comment on whether transparent-front machines could be designed 

with zone cooling..................................................................................................... 21

Item 3-17 DOE seeks comment on how to select baseline efficiency levels for equipment 

classes without a previous energy conservation standard (e.g., combination 

machines). ................................................................................................................ 21

Item 3-18 What machine sizes and capacities (cubic feet, vendible capacity) should be used as 

analysis points for each equipment class? ............................................................... 21

Item 3-19 DOE seeks information on what particular components and features characterize the 

baseline model in each equipment class (materials, dimensions, insulation, 

refrigerant type, compressors, evaporators, condensers, expansion devices, fans, 

motors, anti-condensate devices and controls, defrost mechanisms and controls, 

lighting, etc.). ........................................................................................................... 21

Item 4-1 DOE welcomes comments on how the above four screening criteria might apply to 

any additional technology option(s) that an interested party recommends to DOE. 22

Item 4-2 DOE welcomes comments on the applicability of the four screening criteria to the 

technologies listed in section 3.4. ............................................................................ 22

Item 5-1 Within each equipment class, for energy consumption levels below the current 

standards’ baseline, DOE seeks information on daily energy consumption and on 

incremental manufacturing costs and components (differentiation in components 

from the baseline, material costs, labor costs, factory overhead costs (excluding 
45

depreciation), building conversion capital expenditures, tooling/equipment 

conversion capital expenditures, research and development (R&D) expenses, 

marketing expenses, etc.)......................................................................................... 23

Item 5-2 DOE is also interested in any equipment test data that stakeholders can provide 

(including equipment parameters, test results, etc., and, in the case that a test 

procedure other than the DOE test procedure was used, the test procedures used and 

rating conditions). Test data for the baseline model in each equipment class is 

particularly important............................................................................................... 23

Item 5-3 DOE requests feedback on the use of the design-option approach to determining the 

relationship between manufacturer selling price and energy efficiency for beverage 

vending machines..................................................................................................... 24

Item 5-4 DOE seeks comment on the markup approach proposed for developing estimates of 

manufacturer selling prices. ..................................................................................... 24

Item 5-5 Are there proprietary designs that DOE should consider for any of the equipment 

under consideration by this rulemaking? If so, how should DOE acquire the cost 

data necessary for evaluating these designs? ........................................................... 25

Item 5-6 Are there alternative design paths that can achieve the same level of max-tech 

energy use (energy efficiency) as those using proprietary designs?........................ 25

Item 5-7 DOE requests feedback on representative sizes. Are the representative sizes used 

for the 2009 BVM final rule adequate, and should they be retained or modified?.. 26

Item 5-8 If DOE were to analyze a combination equipment class, perishables (including or in 

addition to beverages) equipment class, or other new equipment classes, what 

should be the relevant representative sizes for that class?....................................... 26

Item 5-9 DOE requests information on the use of alternative refrigerants in beverage 

vending machines, including shipment, cost, and energy consumption information.

.................................................................................................................................. 26

Item 5-10 Are there additional regulatory issues that DOE should consider in its analysis of 

beverage vending machines? Do the issues discussed in this section affect 

shipments, cost, or energy efficiency? ..................................................................... 26

Item 6-1 How should DOE consider energy use in “heating mode” for outdoor machines in 

cold climates?........................................................................................................... 27

Item 7-1 DOE requests information on the distribution channels described above for the 

beverage vending machines covered under this rulemaking. DOE also seeks 

information on other major distribution channels that DOE should be considering 

for markups analysis. DOE also requests information on the relative fractions of 

shipments expected for each channel....................................................................... 28

Item 7-2 DOE requests information on how the overall markups for the beverage vending 

machines covered under this rulemaking may vary for each channel. .................... 28

Item 7-3 DOE requests feedback on its proposal to use baseline and incremental markups. 28

Item 7-4 DOE requests comment on sources of relevant data that could be used to calculate 

markups for each distribution channel..................................................................... 28

Item 8-1 DOE seeks comment on the proposed approaches for estimating current and 

forecasted energy prices........................................................................................... 29

Item 8-2 DOE seeks comment on the proposed approaches for estimating discount rates for 

customers using the equipment covered under this rulemaking. ............................. 30

Item 8-3 DOE recognizes that a large fraction of the customers of beverage vending 

machines are beverage bottlers. Which commercial sectors besides the bottlers 

should be considered in the evaluation of discount rates? In addition, do 
46

stakeholders believe that government direct purchases of this equipment are large 

enough to require that they be included in the evaluation of discount rates? .......... 30

Item 8-4 DOE seeks feedback on what fraction of the installation, maintenance, and repairs 

involve efficiency improvements and what are the typical practices during the life 

cycle of an originally manufactured beverage vending machine (e.g., change lamps 

but not the compressor)............................................................................................ 30

Item 8-5 What is a typical time period between the sale of a new BVM unit and the first 

maintenance or repairs? What are the typical cycles of maintenance and repairs? . 30

Item 8-6 DOE seeks feedback on whether (and how) routine maintenance, repair, and 

installation costs will change for more-efficient equipment.................................... 30

Item 8-7 DOE seeks feedback on appropriate methodologies for assessing changes to 

maintenance, repair, and installation costs. ............................................................. 31

Item 8-8 DOE seeks feedback on appropriate equipment lifetimes for the beverage vending 

machines covered under this rulemaking................................................................. 31

Item 8-9 DOE seeks comment on whether energy conservation standards will have an impact 

on lifetimes of beverage vending machines............................................................. 31

Item 8-10 Is there a suitable inventory model that could be used to estimate the fraction of 

new versus rebuilt/refurbished machines in the market? If no inventory model 

exists, what is the impact of refurbishment on the equipment lifetime? DOE also 

seeks feedback on the number of refurbishment cycles in the typical lifetime of the 

beverage vending machines. DOE also seeks information on the effect of 

refurbishments on equipment utility and energy consumption. In a typical 

refurbishment, for example, are features added to the beverage vending machine 

that affect its utility and/or are changes made that affect the energy consumption of 

the equipment? ......................................................................................................... 31

Item 9-1 DOE requests data on, sources of data related to, or any information pertaining to 

historical shipments and the market shares of the different efficiency levels offered 

in each equipment class. .......................................................................................... 32

Item 9-2 DOE seeks information on representative saturation rates for each equipment class 

covered under this rulemaking, as well as industry-trend data regarding relative 

growth in each equipment class. .............................................................................. 32

Item 9-3 DOE seeks input on methods of projecting the markets for each equipment class 

and access to models or methods that could be used to estimate shipments. .......... 32

Item 9-4 DOE seeks input on likely impacts on shipments due to new or amended standards 

for beverage vending machines. Please comment on what the possible scenarios are 

and the estimated quantitative impact of each scenario on the shipments numbers.33

Item 10-1 DOE seeks comment on the share of the market that is met by refurbished or rebuilt 

machines. In particular, DOE seeks comment on the impact of 

refurbishment/rebuilding on the energy consumption and lifetime of the existing 

fleet in the absence of standards, and the impact of new standards on refurbishment 

kits, the subsequent cost, and performance of the stock of existing equipment. ..... 34

Item 10-2 DOE seeks comment on its plan to develop NES spreadsheet models for estimating 

national impacts of amended energy conservation standards. ................................. 34

Item 11-1 DOE seeks input on which customer subgroups DOE should consider in the present 

rulemaking. Examples of possible subgroups DOE could consider appropriate for 

beverage vending machines are manufacturing facilities that own their own BVM 

units, which was the identified subgroup in the 2009 BVM final rule analysis, and 

site owners that pay the utilities but don’t own or stock the equipment.................. 35
47

Item 12-1 DOE seeks comment on appropriate manufacturer subgroups, if any, that DOE 

should consider in the manufacturer subgroup analysis for beverage vending 

machines. ................................................................................................................. 36

Item 12-2 DOE seeks comment on small businesses that could be impacted by amended 

energy conservation standards for beverage vending machines, and what those 

impacts might entail................................................................................................. 37

Item 12-3 DOE welcomes comments on other existing or pending regulations it should 

consider in its examination of cumulative regulatory burden.................................. 37

Item 13-1 DOE requests feedback on this approach to assessing employment impacts.......... 38

Item 14-1 DOE seeks input on its proposed use of NEMS-BT to conduct the utility impact 

analysis..................................................................................................................... 38

Item 14-2 Should DOE consider using methods other than NEMS in the utility impact 

analysis?................................................................................................................... 38

Item 15-1 DOE seeks input on its approach to conduct the emissions analysis for the 

equipment covered by this rulemaking. ................................................................... 40

Item 16-1 DOE requests comments on the approach it plans to use for estimating monetary 

values associated with emissions reductions. .......................................................... 41

Item 17-1 DOE is aware of the existing ENERGY STAR program for the beverage vending 

machine industry covered under this rulemaking. Are stakeholders aware of any 

other such programs that should be examined as optional, non-regulatory 

approaches?.............................................................................................................. 41

Item 17-2 Are there specific subgroups of end-users whom DOE should consider in its review 

of potential adverse impacts from standards developed under this rulemaking? .... 42