Department of Energy

Energy Efficiency & Renewable Energy

ResBoilers2012STD0047@ee.doe.gov

NOPR Public Meeting on Energy Conservation 

Standards for Residential Boilers
2

Welcome

• Introductions

• Role of the Facilitator

• Ground Rules 

– One person speak at a time (raise hand to be recognized) 

– Say your name for the record – there will be a complete transcript of this 

meeting

– Use short, succinct statements – keep to the point

– Hold sidebar conversations outside the room

– Set cell phones to silent/vibrate

• Housekeeping Items

• Agenda Review

• Opening Remarks
3

Listening Via the Webcast

• The Department is broadcasting this meeting live over the Internet.

• DOE is providing the webcast to accommodate interested parties who are 

unable to attend the public meeting in person.

• The web broadcast allows interested parties to listen in, view the 

presentation slides, and participate in the discussion.

• All interested parties are encouraged to submit written comments after 

the public meeting.
4

Purpose of the Public Meeting

• To present analytical methodologies used to evaluate standards for 

boilers, and characterize results for analyses to date.

• To seek input from attendees on methodologies, assumptions, data 

sources, and DOE’s proposed standard levels.

• To invite participants to provide summary statements and raise additional 

issues for discussion.

• To describe upcoming analyses and next steps.

Interested parties who contacted DOE to request an 

opportunity to make an opening statement may do so 

now.
5

Request for Comment

The deadline for submitting comments is June 1, 2015. 

Issue Box: DOE welcomes comments, data, and information concerning 

its proposed standards for residential boilers. Issues on which DOE seeks 

comment are highlighted in issue boxes throughout this presentation. 

Whether invited by an issue box or not, comments are welcome on any 

part of DOE’s analysis.
6

Public Meeting Agenda

1 Overview

2 Market & Technology Assessment; Screening Analysis

3 Engineering Analysis

4 Markups Analysis and Energy Use Characterization

5 Life-Cycle Cost and Payback Period Analysis

6 Shipments, National Impact Analysis, RIA

7 Manufacturer Impact Analysis

8 Environmental Impacts; Indirect Employment

9 Closing Remarks and How to Submit Comments
7

Regulatory Authority

• Energy Policy and Conservation Act of 1975 (EPCA), Pub. L. 94-163 

– Established the Energy Conservation Program for Consumer Products Other Than 

Automobiles, which covers residential boilers.

• National Appliance Energy Conservation Act of 1987 (NAECA), Pub. L. 100-12 

– Amended EPCA to prescribe standards for boilers. (42 U.S.C. 6295(f)(1))

– Directed DOE to conduct two further rulemakings to determine whether to amend these 

standards. (42 U.S.C. 6295(f)(4)(A)-(C))

• Energy Independence and Security Act of 2007 (EISA 2007), Pub. L. 110-140 

– Amended EPCA to direct DOE to review standards for covered products at least once 

every 6 years. (42 U.S.C. 6295(m)(1))

– Amended the energy conservation standards for boilers. (42 U.S.C. 6295(f)(3))

– Required new or amended standards promulgated after July 1, 2010 to address standby 

mode and off mode energy use. (42 U.S.C. 6295(gg)(3))
8

• NAECA established the initial standards for boilers. (42 U.S.C. 6295(f)(1))

• DOE published a final rule revising the energy conservation standards for 

boilers on November 19, 2007. 72FR 65136.

• EISA 2007 further revised the minimum AFUE requirements for residential 

boilers and set several design requirements for each product class. (42 U.S.C. 

6295(f)(3))

– Required gas-fired hot water, oil-fired hot water, and electric hot water boilers 

manufactured after September 1, 2012 to have an automatic means for 

adjusting water temperature.

– Disallowed the use of constant-burning pilot lights in gas-fired hot water and 

gas-fired steam boilers manufactured after September 1, 2012. 

Regulatory Authority
9

Introduction and Overview: Current Energy Conservation Standards

Boiler Product Class AFUE (%) Design Requirements

(A) Gas-fired hot water boiler 82

• Constant burning pilot not permitted.

• Automatic means for adjusting water temperature 

required (except for boilers equipped with tankless

domestic water heating coils).

(B) Gas-fired steam boiler 80 • Constant burning pilot not permitted.

(C) Oil-fired hot water boiler 84

• Automatic means for adjusting temperature 

required (except for boilers equipped with tankless

domestic water heating coils).

(D) Oil-fired steam boiler 82 • None

(E) Electric hot water boiler None

• Automatic means for adjusting temperature 

required (except for boilers equipped with tankless

domestic water heating coils

For residential boilers manufactured after September 1, 2012.

• EISA 2007 established the current energy conservation standards for boilers, 

which were codified by DOE at 10 CFR 430.32(e)(2)(ii) in a technical 

amendment final rule published in the Federal Register. 73 FR 43611 (July 

28, 2008).
10

EPCA directs DOE to consider to the greatest extent practicable seven factors 

when setting energy conservation standards. (42 U.S.C. 6295(o)(2)(B))

Factor Analysis

1. Economic impact on consumers 

and manufacturers

Life-cycle cost analysis

Manufacturer impact analysis

2. Lifetime operating cost savings Life-cycle cost analysis

3. Total projected energy savings National impact analysis 

4. Impact on utility or performance Screening analysis

Engineering analysis

5. Impact of any lessening of competition Manufacturer impact analysis

6. Need for national energy conservation National impact analysis

7. Other factors the Secretary considers 

relevant

Environmental assessment

Utility impact analysis

Employment impact analysis

Criteria for Selecting Standard Levels
11

Rulemaking Timeline

2012 2013 2014 2015 2016 2017 2018 2019 2020 2021

Milestone Date

Framework Document February 2013

Notice of Data Availability (NODA) February 2014

Notice of Proposed Rulemaking (NOPR) March 2015

Final Rule (projected) December 2015

Compliance Date (projected) December 2020
12

Energy Conservation Standards Rulemaking
13

Public Meeting Agenda

1 Overview

2 Market & Technology Assessment; Screening Analysis

3 Engineering Analysis

4 Markups Analysis and Energy Use Characterization

5 Life-Cycle Cost and Payback Period Analysis

6 Shipments, National Impact Analysis, RIA

7 Manufacturer Impact Analysis

8 Environmental Impacts; Indirect Employment

9 Closing Remarks and How to Submit Comments
14

Market and Technology Assessment

Purpose

• Characterize the market, the boiler industry, and the measures to 

improve boiler efficiency.

Method

• Identify and characterize manufacturers of residential boilers;

• Gather historical shipments and other relevant data;

• Characterize products currently available on the market; and

• Identify technology options for improving efficiency.
15

Market Assessment: Product Classes

Boilers

GasFired

Hot 

Water Steam

Oil-Fired

Hot 

Water Steam

Electric

Hot 

Water Steam

Key

AFUE and Standby/off 

Analyzed

Only Standby/off Analyzed
16

Market Characterization

• Predominantly a replacement 

market.

• Gas-fired hot water boilers 

make up the majority of the 

market. 

• The heat exchangers of 

residential boilers are 

commonly made from the 

following materials:

• Cast Iron

• Copper

• Steel

• Stainless Steel

• Aluminum

Gas-Fired 

Gas Hot Water-Fired 

Steam

Oil-Fired 

Hot 

Water

Oil-Fired 

Steam

Electric 

Steam

Electric Hot 

Water

2012 Estimated Shipments
17

Source: DOE Database 2013 (consists of data from AHRI and DOE directory)

0

20

40

60

80

100

120

82 83 84 85 86 87 88 89 90 91 92 93 94 95 96

Cast Iron

Steel

Copper

Number of Models

AFUE (%)

Market Characterization: Gas-Fired Hot Water

Aluminum

Stainless Steel

Baseline

(82%)
18

Source: DOE Database 2013 (consists of data from AHRI and DOE directory)

0

5

10

15

20

25

30

35

40

45

80 81 82 83

Cast Iron

Steel

Copper

Number of Models

AFUE (%)

Market Characterization: Gas-Fired Steam

Aluminum

Stainless Steel Baseline

(80%)
19

0

20

40

60

80

100

120

140

84 85 86 87 88 89 90 91 92 93

Cast Iron

Steel

Copper

Number of Models

AFUE (%)

Market Characterization: Oil-Fired Hot Water

Aluminum

Baseline Stainless Steel

(84%)

Source: DOE Database 2013 (consists of data from AHRI and DOE directory)
20

0

5

10

15

20

25

30

35

40

82 83 84 85 86

Cast Iron

Steel

Copper

Number of Models

AFUE (%)

Market Characterization: Oil-Fired Steam

Aluminum

Stainless Steel Baseline

(82%)

Source: DOE Database 2013 (consists of data from AHRI and DOE directory)
21

Technology Options

• DOE identified technologies that improve the AFUE, as well as standby 

mode and off mode, as measured by DOE’s test procedure for residential 

boilers.

Technology Option (AFUE)

Heat Exchanger Improvements

Modulating Operation

Dampers

Direct Vent

Pulse Combustion

Premix Burners

Burner Derating

Lower-Pressure Air-Atomized Oil 

Burner

Delayed-Action Oil Pump Solenoid 

Valve

Electronic Ignition

Technology Option (Standby/Off)

Transformer Improvements

Control Relay Models with BPM Motors

Switching Mode Power Supply
22

Screening Analysis

Purpose

• Screen out technology options that DOE will not consider in the 

engineering analysis for residential boilers. 

Method

• 10 CFR Part 430, Subpart C, Appendix A, 4(a)(4) and 5(b) direct DOE to 

evaluate each technology option based on the following criteria: 

• Technological feasibility

• Practicability to manufacturer, install and service

• Impacts on product utility or availability to consumers 

• Impact on health or safety
23

Screening Analysis

• DOE screened out three technology options on the basis of potential 

impact on product utility or availability to consumers.

Technology Option Reason for Screening Out

Pulse Combustion Could reduce customer utility

Burner Derating Could reduce customer utility

Control Relay to depower BPM motors Could reduce customer utility
24

Public Meeting Agenda

1 Overview

2 Market & Technology Assessment; Screening Analysis

3 Engineering Analysis

4 Markups Analysis and Energy Use Characterization

5 Life-Cycle Cost and Payback Period Analysis

6 Shipments, National Impact Analysis, RIA

7 Manufacturer Impact Analysis

8 Environmental Impacts; Indirect Employment

9 Closing Remarks and How to Submit Comments
25

Engineering Analysis

Purpose

• Determine the relationship between manufacturer selling price and 

increased efficiency in both active mode and standby mode/off mode 

operation of boilers. 

Method

• For active mode (AFUE), DOE used an efficiency level approach and 

reverse engineering teardowns/cost modeling. 

• For standby mode and off mode, DOE used a design option approach.

• Information sources include:

• Product teardowns

• Manufacturer interviews

• Product testing

• Product literature

• DOE and AHRI product certification database
26

Engineering Analysis (AFUE)

Physical and 

Catalog 

Teardowns/

BOMs

Selection of 

Efficiency 

Levels

Selection of 

Units for 

Teardown

MPCs for Units 

Torn Down 

(Physical and 

Catalog)

Manuf. Cost 

Estimate

Estimated 

Market Share 

by 

Manufacturer Manufacturer 

Markup

Industry 

Average 

MPCs

Industry 

Average 

MSPs

Design 

Option 

Pathway

Model 

Information 

(from MTA)
27

Engineering Analysis

Source: Estimated Shipments 

= Several teardowns at several efficiency levels; most of the resources were allocated for this class.

= 0-2 teardowns; some of the results will be derived from other analyses and available sources.

= No teardowns; all results will be derived from analyses on other product classes.

Estimated % of Shipments (2012) Analysis Level

Gas-Fired Hot Water 66.3 Full Teardown Analysis

Gas-Fired Steam 9.7 Full Teardown Analysis

Oil-Fired Hot Water 18.4 Full Teardown Analysis

Oil-Fired Steam 2.3 Alternative Analysis

Electric Hot Water 2.9 Alternative Analysis

Electric Steam 0.4 Alternative Analysis

• DOE focused its analysis on product classes with the highest percentage of shipments.

– DOE performed a “full teardown analysis” for several product classes, which consisted of 

numerous teardowns across a range of efficiency levels.

– DOE performed an “alternative analysis” for other product classes, which relied on a small 

number of teardowns and/or other data sources.
28

Description of Baseline Models for Active Mode

Product 

Class

Input 

Capacity 

(Btu/h)

Baseline 

AFUE HX Material HX Design Draft Type

Gas Hot Water 100,000 82% Cast 

Iron/Copper

Sectional, DryBased or 

Copper-finned 

tube

Atmospheric

Gas Steam 100,000 80% Cast Iron Sectional, DryBased Atmospheric

Oil Hot Water 140,000 84% Cast Iron Sectional, WetBased Natural

Oil Steam 140,000 82% Cast Iron Sectional, WetBased Natural

• A baseline unit is a unit that just meets current Federal energy 

conservation standards and provide basic consumer utility. 

• DOE analyzed representative input capacities for gas-fired units of 

100,000 Btu/h and for oil-fired units of 140,000 Btu/h. 
29

• For each equipment class, DOE selected AFUE efficiency levels for 

analysis at:

– The baseline efficiency level.

– Efficiency levels with the highest numbers of models available. 

– Efficiency levels that represent substantial technological changes.

– The max-tech efficiency level.

Product Class

AFUE Efficiency Levels (%)

Baseline EL1 EL2 EL3 EL4 EL5 Max-Tech

Gas Hot Water 82 83 84 85 90 92 96

Gas Steam 80 82 - - - - 83

Oil Hot Water 84 85 86 - - - 91

Oil Steam 82 84 85 - - - 86

AFUE Efficiency Levels Analyzed 
30

Engineering Analysis

• DOE selected units for teardown spanning the efficiency levels within a 

given product class. 

• Representative input capacity for analysis was 100,000 Btu/h for gasfired boilers and 140,000 Btu/h for oil-fired boilers.

• DOE chose products from multiple manufacturers.

– Fabrication techniques, basic equipment design, and other factors differ 

across manufacturers. Due to these variations, the MPCs for different 

manufacturers to produce similar equipment designs can vary. 
31

NOPR Teardown Analysis: Methodology

Action Description

Physical Teardown DOE disassembles residential boilers into their component 

parts to create a bill of materials (BOM) that is used as the 

basis for the cost estimate for a particular model.

Catalog Teardown DOE uses published manufacturer catalogs and 

supplementary component information to estimate the 

major differences between a product that was torn down 

and a one that was not. These differences are reflected in a 

bill of materials for a particular model, which is used to 

generate a cost estimate for that model.

Alternative Method In addition to teardowns, DOE relied on product literature, 

as well as information obtained in the hot water boiler 

analysis to produce the steam boiler cost curves. 
32

NOPR Teardown Analysis: Summary

Gas Hot Water Boilers

Gas Steam Boilers

Oil Hot Water Boilers

Oil Steam Boilers

AFUE

= Tear-down

= Alternative methodology

= Interpolated (Linear)

82% 83% 84% 85%

80% 82%

84% 86%

82% 84%

90% 96%

91%

86%

83%

92%

85%

95%

85%
33

Cost-Efficiency Relationships

• DOE created cost-efficiency curves for each major 

manufacturer.

• DOE combined manufacturer curves based on estimated 

market share to develop a weighted-average cost-efficiency 

curve for each product class.

Weighted Average $MPC

Efficiency Level

Manufacturer Curves* $MPC

Efficiency Level

Manuf. #1

Manuf. #2

Manuf. #3

*Stylized graphics not based on actual data. 
34

Cost-Efficiency Curve: Gas-Fired Hot Water 

400

600

800

1000

1200

1400

1600

82 83 84 85 90 92 96

Manufacturer Production Cost (2013$)

AFUE (%)
35

700

750

800

850

900

950

1000

80 82 83

Manufacturer Production Cost (2013$)

AFUE (%)

Cost-Efficiency Curve: Gas-Fired Steam
36

Cost-Efficiency Curve: Oil-Fired Hot Water

600

800

1000

1200

1400

1600

1800

2000

2200

2400

84 85 86 91

Manufacturer Production Cost (2013$)

AFUE (%)
37

Cost-Efficiency Curve: Oil-Fired Steam

1000

1100

1200

1300

1400

1500

1600

1700

82 84 85 86

Manufacturer Production Cost (2013$)

AFUE (%)
38

• Non-condensing residential boilers may come equipped with inducer 

fans to supplement airflow of the combustion products in installations 

where it is evident that natural venting will be inadequate. 

• The MPC’s shown in the preceding slides do not include the cost of the 

inducer fan, as inducer fans were not shown to have an impact on 

efficiency. The cost of the inducer fan is included in the downstream 

analysis. 

• DOE estimated the cost difference between a boiler with induced draft 

and one with natural draft boiler to be $94. 

Engineering Analysis: Inducer Fan

Natural Draft Induced Draft

Vent Damper Inducer Assembly

Flue Collector Flue Collector

Draft Hood Vent Connector Kit

Sensors Sensors

Component List for Natural Draft v. Induced Draft
39

Engineering Analysis

Request for Comment

Issue 3-1: DOE seeks comments on any issues related to the methodology, 

assumptions, and results for the engineering analysis for AFUE efficiency 

levels.

Issue 3-2: DOE requests further comment from interested parties on noncondensing levels above 82 percent, and the appropriateness of such levels 

for amending such energy conservation standards.

Issue 3-3: DOE requests comments on all aspects of the engineering analysis.
40

Engineering Analysis: Standby Mode/Off Mode Methodology

• DOE used a “design option” approach. 

– DOE determined the baseline standby mode/off mode energy consumption 

for each product class by combining the most energy consumptive 

components within a given product class.

– No existing Federal standard for standby mode/off mode energy consumption of 

boilers.

– Standby mode/off mode energy consumption is not currently published my 

manufacturers.

– Baseline design was established based on product test data and manufacturer 

feedback.

– Design options were applied to the baseline in order of cost-effectiveness.

• DOE assumed identified design options could be applied to all product classes.

– DOE found similar electrical components and systems across product classes

• DOE analyzed one set of efficiency levels that applied to both standby mode and 

off mode energy consumption.

– DOE assumed that there are not distinct standby mode and off mode energy 

consumption profiles for most boilers, as there is typically no seasonal off 

switch.
41

Description of Baseline Models for Standby Mode/Off Mode

Component GHW OHW GS OS EHW ES

Transformer 4 4 4 4 4 4

ECM Burner Motor 1 n/a n/a n/a n/a n/a

Controls 2.5 2.5 2.5 2.5 2.5 2.5

Displays 4 4 4 4 4 4

Oil Burner n/a 3 n/a 3 n/a n/a

Total (watts) 11.5 13.5 10.5 13.5 10.5 10.5

• DOE “assembled” the most consumptive baseline components from the 

models tested to model the electrical system of a boiler with the 

maximum system standby mode and off mode power consumption.
42

• DOE identified two design options for reducing standby mode and off 

mode energy consumption that passed the screening analysis:

– Low-loss transformer (LLTX)

– Switching mode power supply

Engineering Analysis (Standby Mode and Off Mode)

Efficiency 

Level

Description Standby/Off Mode 

Power Consumption 

Reduction (W)

MPC Increase 

(2013$)

Baseline Linear power supply; Standard 

40VA transformer

0 0

1 Linear power supply + LLTX 1.5 $1.00

2 Switching mode power supply 1.8 $10.47

Max-Tech Switching mode power supply + 

LLTX

2.5 $11.12
43

Engineering Analysis

Request for Comment

Issue 3-4: DOE requests comment on the efficiency levels analyzed for the 

standby mode/off mode analysis, and on the assumption that standby mode 

and off mode energy consumption (as defined by DOE) would be equal.
44

Public Meeting Agenda

1 Overview

2 Market & Technology Assessment; Screening Analysis

3 Engineering Analysis

4 Markups Analysis and Energy Use Characterization

5 Life-Cycle Cost and Payback Period Analysis

6 Shipments, National Impact Analysis, RIA

7 Manufacturer Impact Analysis

8 Environmental Impacts; Indirect Employment

9 Closing Remarks and How to Submit Comments
45

Markups Analysis

Purpose

• Determine consumer prices based on manufacturer’s selling price (MSP) for baseline 

and higher-efficiency products.

• Characterize residential boiler distribution channels.

Manufacturer Wholesaler Mechanical 

Contractor

General 

Contractor Consumer

Replacements New Construction

Input Data Source

Manufacturer Markup U.S. SEC 10-K (see engineering analysis).

Wholesaler Markup Firm income statements from the HARDI 2012 Profit Report.

Mechanical Contractor 

Markup

ACCA 2005 Financial Analysis report and Plumbing and HVAC Contractors sector from 

the US Census Bureau, 2007 Economic Census.

General Contractor Markup US Census Bureau, 2007 Economic Census: Residential Building Construction sector.

Sales Tax 2013 Sales Tax Clearinghouse Data.

Method

• Analyze company direct costs, expenses, and profits.

Manufacturer Wholesaler Mechanical 

Contractor Consumer

Note: Replacements includes new owners. The national account channel is included for a fraction of boilers purchased for commercial installations.
46

Markups Analysis

Baseline Markups

• Relate the MSP of baseline equipment to the consumer purchase price.

• DOE applied baseline markups to the MSP of the baseline efficiency level.

Incremental Markups

• Relate the increase in MSP of more-efficient products to the increase in 

consumer purchase price. 

• Cover only expenses that vary with MSP (e.g., operating expenses and profit).

− Fixed costs such as overhead and labor do not scale with increased efficiency.

• DOE applied the incremental markups to the incremental difference in MSP at 

each level above the baseline.

Market Segments Fractions: Based on shipments analysis for 2020.

Product Class Replacement New Construction

Gas-fired hot water boiler 90% 10%

Oil-fired hot water boiler 98% 2%

Electric hot water boiler 77% 23%

Gas-fired, Oil-fired, and Electric steam boilers 100% 0%

Note: DOE estimate that 7 percent of residential boiler shipments will be installed in 

commercial buildings.
47

Average Markups for Market Participants (Residential Applications)

Market Participant

Replacement New Construction

Baseline Incr. Baseline Incr.

Manufacturer 1.41 1.41

Wholesaler 1.36 1.10 1.36 1.10

Mechanical Contractor 1.55 1.24 1.45 1.16

General Contractor - 1.41 1.28

Sales Tax 1.06 -

Overall Markup 3.15 2.04 3.92 2.30

Markups Analysis

Product Class Baseline Average Markup Incremental Average Markup

Gas-fired hot water boiler 3.27 2.07

Gas-fired steam boiler 3.17 2.04

Oil-fired hot water boiler 3.16 2.01

Oil-fired steam boiler 3.15 2.02

Electric hot water boiler 3.22 2.03

Electric steam boiler 3.14 2.03

Total Markups by Product Class
48

Request for Comment

Issue 4-1: DOE requests comments on the markups methodology approach used 

in the analysis.

Markups Analysis
49

Energy Use Characterization

Purpose

• Determine annual energy consumption of residential boilers at the considered 

efficiency levels to find annual energy costs and savings. 

Method

• Space Heating: Burner operating hours (BOH) multiplied by input capacity. 

Determined using AFUE value at each efficiency level, RECS 2009 and CBECS 2003 

heating energy use data, and adjustment factors.

• Water Heating: Determined using AFUE value at each efficiency level, RECS 2009 and 

CBECS 2003 water heating energy use data, and adjustment factors.

• Electricity: Determined using BOH and power ratings of the electrical components.

• Standby Mode and Off Mode: Electricity use calculated based on standby mode/off 

mode hours and the power ratings for each technology option.

Model Characteristics

• All Non-Condensing Boilers and Condensing HWOBs: Single-Stage Controls

• All Condensing HWGBs: Modulating Controls

Energy Use = Space Heating Fuel + Water Heating Fuel + Electricity Use
50

Energy Use Characterization

Building Sample Determination

Building has a Residential Boiler if:

• Boiler is the main or secondary source of heat

• Boiler uses a heating fuel that is natural gas/LPG, 

electricity, or fuel oil

• Heating energy consumption greater than zero

• Heated square footage is less than 10,000

* Steam boiler sample only includes buildings built before 1970.

Note: DOE calculated that 7% of boilers are installed in commercial buildings.

Building 

has a 

residential 

boiler?

Gas-Fired Hot Water

Oil-Fired Hot Water

Gas-Fired Steam

Oil-Fired Steam

Electric Hot Water

Out of Sample

RECS 2009 

Sample

Oil

Yes

Boiler 

Fuel 

Type?

Electricity

Gas

CBECS 

2003 

Sample

Hot Water

Steam*

Hot Water

Steam*

Product Class Count # of Bldgs, 

million

RECS 2009

Gas-fired Hot Water Boilers 646 6.05

Gas-fired Steam Boilers 471 4.55

Oil-fired Hot Water Boilers 482 3.99

Oil-fired Steam Boilers 359 3.08

Electric Hot Water Boilers 49 0.49

Electric Steam Boilers 31 0.32

Electric Steam

Hot Water

Steam*

No
51

Space Heating Fuel Use

• Calculations based on proposed Federal Test Procedure for Boilers (2015)

Boiler Input Capacity

• Assumed to be the same for all efficiency levels.

• Based on simplified boiler sizing method using:

– Square footage, vintage, foundation type, shell characteristics, number of floors, 

– Outdoor design temperature,

– Existing AFUE (based on RECS/CBECS Boiler Age and historical shipments by efficiency), and 

– Oversize factor (1.7 based on ASHRAE 103-2007 Test Procedure).

Burner Operating Hours

• Building Heating Load: The building heating load served by a single boiler.

• Useful Output: Includes energy delivered in the supply water, energy to the environment, 

and electrical losses.

Annual Fuel Use = Burner Operating Hours × Boiler Input Capacity

Burner Operating Hours =

Building Heat Load

Useful Output

Energy Use Characterization
52

Burner Operating Hours

Building Heating Load (Served by Single Boiler)

• QYR: annual fuel consumption for heating based on RECS 2009 or CBECS 2003 (kBtu/yr)

• AFUEex,adj: AFUE of the existing boiler adjusted for field conditions

• AdjFactor(s): Adjustment factors to building load

– Secondary Heating Adjustment – based on RECS 2009/CBECS 2003 data,

– Building shell efficiency in 2020 – based on AEO 2013 data,

– Average climate conditions in 2013 – based on 10-year NOAA HDD data,

– Heating Degree Day (HDD) trend from 2013 to 2020 – based on AEO 2013 data.

• BoilerCount = number of boilers used to fulfill the building heating load

• NumberofUnitsServed: number of housing units served by boiler

Useful Output (by Single Boiler)

• AFUEnew,adj: AFUE of the new boiler adjusted for field conditions

Energy Use Characterization

BHLBoiler =

QYR×AFUEex,adj ×AdjFactor s

BoilerCount x NumberofUnitsServed

UsefulOutputBoiler = UsefulElectricHeat + QIN × AFUEnew,adj
53

Field-Adjusted AFUE

• Adjustments applied to the AFUE of the existing and new boiler.

• Return Water Temperature (RWT) adjustment assumptions

– Based on high and low RWT applications.

• High RWT (annual average 160°F): finned-tube convective baseboards/panel radiators (140-180°F)

• Low RWT (annual average 110°F): in-floor radiant tubing (100-120°F)

– Temperature difference between supply and return water temperature of 20°F

• Automatic means adjustment assumptions 

– Adjustments are applied to all equipment installed after 2012

– Single-stage: -2°F adjustment applied to average RWT (High RWT = 158°F, Low RWT = 108°F)

– Modulating: -10°F adjustment was applied to the average Low RWT (Low RWT = 100°F)

• Jacket loss adjustment assumptions

– Applied to boilers installed in non-conditioned spaces (non-conditioned basements, garages)

• 35% of gas-fired boiler installations and 53% of oil-fired boiler installations.

– Jacket loss factor values (0.24% for low-mass boilers)

• 2.40% for high-mass boilers (based on ASHRAE 103-2007)

• 0.24% for low-mass boilers (assumed to be 10% that of high-mass boilers value)

• Assumed 75% of condensing boilers are low-mass, and 25% of non-condensing boilers are low-mass.

Energy Use Characterization
54

Adjustments to AFUE

• Adjustment to AFUE based on RWT application and automatic means option (single-stage boilers)

• Adjustment to AFUE based on RWT application (modulating boilers)

• RWT Fraction for Condensing Installations

Energy Use Characterization

Low RWT

(108°F)

High RWT w/ 

Automatic Means 

(158°F)

High RWT w/o 

Automatic Means 

(160°F)

Non-Condensing - -1.02% -1.07%

Condensing +2.01% -3.11% -3.16%

Low RWT High RWT (140°F)

(100°F) (120°F)

Condensing +3.28% As Reported -2.52%

Note: DOE assumed same RWT impact for thermal efficiency and AFUE

Market Segments

Fraction with

Low RWT*

New Construction/New Owners 100%

Replacements (Built After 1990) 50%

Replacements (Before 1990) 10%

*Of the low RWT applications, 50% are assumed to be at 

100°F RWT and 50% are assumed to be 120°F RWT.
55

Distribution of Heating Energy Use

Energy Use Characterization

Equipment Class

Average Heating Energy Use 

from RECS 2009/CBECS 2003, 

MMBtu/yr (Median)

Average Estimated Heating Energy 

Use in 2020 at Baseline,

MMBtu/yr (Median)

HWGB 95.3 (72.2) 72.5 (56.3)

SGB 98.1 (78.2) 75.1 (61.4)

HWOB 98.1 (72.3) 78.5 (57.8)

SOB 99.9 (70.8) 79.3 (55.4)
56

Water Heating Energy Consumption

Boilers Used for Water Heating 

• RECS 2009 and CBECS 2003 do not report if a boiler is used for water heating, so DOE assumed that 

boilers are used for water heating in: 

– 50% of buildings using tank water heating and the same fuel for space and water heating.

– 100% of buildings using tankless water heating and the same fuel for space and water heating.

Annual Water Heating Fuel Consumption

• AdjFactorWH: difference between AFUE and water heating efficiency; adjusting for difference 

between AFUE and steady-state efficiency, jacket losses in non-conditioned space, and tankless coil. 

• Water Heating Loss (WHloss): assumed to be 0.5 kBtu/h for indirect tank; 0 kBtu/h for tankless coil.

Water Heating Load

• QYR,WH: annual fuel consumption for water heating based on RECS 2009 or CBECS 2003 (MMBtu/yr)

FuelUseWH =

Water Heating Load

AFUE − AdjFactorWH

× 1 −

WHloss

QIN

+ 8760 × WHloss 1000

Water Heating Load = QYR,WH X AFUEexisting − AdjFactorWH

Energy Use Characterization
57

Distribution of Water Heating Energy Use

Energy Use Characterization

Equipment 

Class

Fraction of 

Boilers Used for 

Water Heating

Average Water Heating Energy 

Use from RECS 2009/CBECS 

2003, MMBtu/yr (Median)

Average Estimated Water 

Heating Energy Use in 2020 at 

Baseline, MMBtu/yr (Median)

HWGB 40.6% 29.5 (25.9) 28.6 (25.2)

SGB 39.8% 28.6 (26.1) 27.3 (25.1)

HWOB 39.6% 19.7 (16.6) 19.4 (16.5)

SOB 34.9% 19.3 (16.5) 18.9 (16.3)
58

Electricity Use

Active Mode

• Electricity use when the boiler is being used for space or water heating:

• BOHSH,WH: burner operating hours for space heating and water heating

• ElecPower: power of electrical components (according to test procedure)

– Accounts for the electricity use by circulating pump, draft inducer, igniter, and condensate pump.

• ElecUseStby: energy consumption during standby

• ElecUseAC : additional cooling energy consumption during non-heating season due to boiler 

operation for water heating loads (when applicable)

Standby Mode and Off Mode

• Electricity use when the boiler is not in use for space or water heating:

– PowerStby,Off: power use during standby mode and off mode

Total Electrical Use = BOHSH,WH × ElecPower + ElecUseStby [+ElecUseAC]

ElecUseStandby or Off Mode = PowerStby,Off × (8760 − BOHSH,WH)

Energy Use Characterization
59

Electricity Use Assumptions

• Primary Circulating Pump: Assumed that non-condensing and condensing units use the same 

pump motor type (average of 80 Watts). Did not consider pumps with higher efficiency motors.

• Induced/Forced Draft Fan: Average values derived from 2013 AHRI directory:

* For two-stage and modulating, assumed that the reduced inducer power would be 70 % of the values indicated in 

the table (applied to gas-fired hot water boilers at or above 90% AFUE).

• Ignition: Assumed spark ignition for all products, with igniter power equal to 25W.

• Condensate Pump (when present): Assumed power equal to 60W.

• Standby Mode/Off Mode: assumed 25 percent of consumers shut the boiler off 

during the non-heating season.

Energy Use Characterization

Product Type

Gas-Fired Hot 

Water Boiler, 

(Watts)

Gas-Fired 

Steam Boiler, 

(Watts)

Oil-Fired Hot 

Water Boiler, 

(Watts)

Oil-Fired 

Steam Boiler, 

(Watts)

Non-Condensing (natural-draft) 44 66 236 264

Non-Condensing (induced-draft) 153 106 180 175

Condensing* 95 - 266 -
60

Product Class EL AFUE

Fraction of Models 

with 

Induced/Forced Draft*

Gas-fired Hot Water Boiler

0 82% 22.5%

1 83% 36.4%

2 84% 36.4%

3 85% 63.2%

4 90% 100.0%

5 92% 100.0%

6 96% 100.0%

Gas-fired Steam Boiler

0 80% 0.0%

1 82% 5.9%

2 83% 11.1%

Oil-fired Hot Water Boiler

0 84% 29.7%

1 85% 52.7%

2 86% 64.8%

3 91% 100.0%

Oil-fired Steam Boiler

0 82% 18.6%

1 84% 18.6%

2 85% 21.1%

3 86% 21.1%

Fraction of Models with Induced/Forced Draft

Energy Use Characterization

* Source: Reduced boiler model set based on September 2013 AHRI certification directory, 

Energy Star data, CEC data, NRCAN data and Manufacturer Lit. (see Appendix 7-D)
61

Product Class EL AFUE

Annual Fuel Use Annual Electricity Consumption

Total

MMBtu/yr

Savings

MMBtu/yr

Total

kWh/yr

Savings

kWh/yr

Gas-fired Hot Water Boiler

0 82% 84.1 - 167 -

1 83% 83.1 1.0 175 -8

2 84% 82.1 2.0 174 -7

3 85% 81.1 3.0 191 -25

4 90% 75.2 8.9 279 -113

5 92% 73.6 10.5 275 -108

6 96% 70.6 13.4 266 -99

Gas-fired Steam Boiler

0 80% 86.0 - 99 -

1 82% 83.9 2.1 100 0

2 83% 82.9 3.1 112 -13

Oil-fired Hot Water Boiler

0 84% 86.2 - 268 -

1 85% 85.2 1.0 257 10

2 86% 84.3 2.0 251 17

3 91% 80.1 6.2 288 -20

Oil-fired Steam Boiler

0 82% 85.9 - 221 -

1 84% 83.9 2.1 218 4

2 85% 82.9 3.0 215 6

3 86% 81.9 4.0 213 8

Average Annual Energy Consumption and Savings

Energy Use Characterization
62

Product Class EL Design Option Annual Electricity Consumption (kWh/yr)

Total Savings

Gas-fired Hot Water 

Boiler

0 Baseline 86.1 -

1 Linear PS, Toroidal Xfmr 74.9 11.2

2 Switch Mode PS 72.7 13.5

3 SMPS, Toroidal Xfmr 67.4 7.5

Gas-fired Steam 

Boiler

0 Baseline 82.3 -

1 Linear PS, Toroidal Xfmr 70.5 11.8

2 Switch Mode PS 68.2 14.1

3 SMPS, Toroidal Xfmr 62.7 7.8

Oil-fired Hot Water 

Boiler

0 Baseline 105.6 -

1 Linear PS, Toroidal Xfmr 93.8 11.7

2 Switch Mode PS 91.5 14.1

3 SMPS, Toroidal Xfmr 86.0 7.8

Oil-fired Steam 

Boiler

0 Baseline 105.3 -

1 Linear PS, Toroidal Xfmr 93.6 11.7

2 Switch Mode PS 91.2 14.0

3 SMPS, Toroidal Xfmr 85.8 7.8

Electric Hot Water 

Boiler

0 Baseline 87.0 -

1 Linear PS, Toroidal Xfmr 74.5 12.4

2 Switch Mode PS 72.1 14.9

3 SMPS, Toroidal Xfmr 66.3 5.8

Electric Steam Boiler

0 Baseline 86.2 -

1 Linear PS, Toroidal Xfmr 73.9 12.3

2 Switch Mode PS 71.4 14.8

3 SMPS, Toroidal Xfmr 65.7 5.7

Energy Use Characterization: Standby Mode/Off Mode
63

Request for Comment

Issue 4-2: DOE requests comments on the approach of using RECS and 

CBECS data for determining the energy consumption of residential 

boilers in residential and commercial buildings.

Issue 4-3: DOE requests comment on the fraction of boilers that are 

used in commercial applications.

Issue 4-4: DOE’s approach seeks to account for the energy 

performance of residential boilers installed in the field by considering 

automatic means, jacket losses, and return water temperatures. DOE 

requests comments on the reasonableness of its assumptions 

regarding these factors.

Energy Use Characterization

Issue 4-5: DOE requests comment on the fraction of boilers that are 

used in low-temperature vs. high-temperature applications.
64

Request for Comment

Issue 4-9: DOE invites comments and recommendations on any other 

aspects related to DOE’s methodology for estimating the annual 

energy use for residential boilers.

Issue 4-7: DOE requests comment on the fraction of boilers that 

require a draft inducer (by efficiency level).

Energy Use Characterization

Issue 4-8: DOE requests comments on its estimate that 25 percent of 

consumers shut the boiler off during the non-heating season, as well 

as any information that might support a different estimate.

Issue 4-6: DOE requests comment on the fraction of boilers that are 

used for domestic water heating.
65

Public Meeting Agenda

1 Overview

2 Market & Technology Assessment; Screening Analysis

3 Engineering Analysis

4 Markups Analysis and Energy Use Characterization

5 Life-Cycle Cost and Payback Period Analysis

6 Shipments, National Impact Analysis, RIA

7 Manufacturer Impact Analysis

8 Environmental Impacts; Indirect Employment

9 Closing Remarks and How to Submit Comments
66

Life-Cycle Cost and Payback Period Analysis

Engineering 

Analysis

Markups to 

Determine 

Product Price

Energy Use 

Characterization

Baseline 

Manufacturer 

Cost

Std-Level 

Manufacturer 

Cost

Manufacturer 

Markup

Distributer & 

Contractor 

Markups

Sales Tax

Energy 

Consumption

Energy

Prices

Consumer

Price

Installation

Cost

Total

Installed Cost 

Incremental*

Annual

Energy Cost

Repair

Cost

Maintenance

Cost

Annual

Operating 

Cost Savings*

Lifetime

Discount

Rate

Energy Price 

Trend

Discounted 

Lifetime 

Operating

Cost Savings*

Payback

Period

Life-Cycle

Cost

Base Case 

Efficiency

* Differential between Standards Case and Base Case.

LCC and Payback Period Analysis Flowchart
67

Life-Cycle Cost and Payback Period Analysis

Purpose

• Provide an economic evaluation from the residential consumer’s perspective.

• Life-Cycle Cost (LCC) is the total consumer cost over the life of the equipment.

• Payback Period (PBP) is the time required to recover the increased purchase 

price of more energy-efficient equipment through reduced operating costs.

Method

• Use consumer samples developed in the energy use analysis.

• Analysis models the uncertainty and variability of inputs using Monte Carlo 

approach and probability distributions using Excel® with Crystal Ball.®

PBP =

∆Total Installed Cost

∆First Year Operating Cost

LCC = Total Installed Cost + Lifetime Operating Cost

LCC Savings = LCCStd − LCCBase
68

Input Purpose/Definition Methodology

Product Price 

and Trends

Manufacturing cost multiplied by 

markups and sales tax.

Manufacturing cost: from engineering analysis.

Markups and sales taxes: from markups analysis.

Future price trend: historical PPI data.

Installation 

Costs

Labor and materials necessary to 

install appliance.

Higher costs for condensing boiler installations, which have additional 

condensate withdrawal and venting requirements.

Maintenance Routine cost to the consumer for 

boiler maintenance.

Based on maintenance frequency and labor hours and cost.

Repair Cost of replacing or repairing failed 

components in the boiler.

Repair cost is based on failure year, warranty period, labor hours and 

cost, and material cost.

Marginal 

Energy Prices

Develop average marginal monthly 

prices.

Multiplied most current average annual energy prices by monthly 

price factors and marginal price factors by geographical area. 

Energy Price 

Trends

Project future energy prices. Multiply marginal energy prices by the projected annual energy price 

trends for the corresponding Census division.

Discount Rates Determine the present value of 

lifetime operating expenses.

Derived from various types of debt and equity using the Federal 

Reserve Board’s Survey of Consumer Finances.

Lifetime Age when the product is retired 

from service.

Based on national survey data (RECS 2009) and manufacturer 

shipment data (AHRI).

Base-Case 

Efficiencies

Project market share of products at 

each efficiency level in the absence 

of standards.

Based on historical market share data (shipment data) and models 

information (AHRI directory).

Life-Cycle Cost and Payback Period Analysis

LCC Methodology Summary
69

Life-Cycle Cost and Payback Period Analysis

Consumer Product Price = Manufacturing Cost × Markups × Sales Tax

• Manufacturing costs derived from engineering analysis.

• Markups and Sales Taxes determined from the markups analysis.

• Consumer product prices determined for each considered efficiency level. 

• Product price trend based on historical PPI data

− Default price trend: constant.

− Sensitivity analysis considered alternative price trends (decreasing and increasing).

Consumer Product Price
70

Life-Cycle Cost and Payback Period Analysis

Purpose: represent the labor and material costs necessary to install the product.

Installation Costs

Sources

• 2013 RS Means 

(Residential Cost Data & 

Mechanical Cost Data) 

• DOE’s 2007 Furnace and 

Boiler Final Rule

• DOE’s 2011 Furnace 

Direct Final Rule

• Manufacturer literature

Installation 

Location of 

Boiler

Orphaned

Water Heater 

(Replacement)

New PVC Venting

Basic Installation 

Costs

Chimney Relining 

(Replacement)

Metal Vent 

Modification 

(Replacement)

Venting 

Installation

Costs

Condensate 

Withdrawal Install. 

Costs

Individual 

Household 

Installation 

Cost

Non-Condensing Boiler

Condensing Boiler

• Trip charge (replacement only)

• Removing old boiler (replacement only)

• Placing and setting up boiler

• Circulating Pump

• Gas/oil piping

• Water piping

• Electrical hookup for thermostat

• Permit and removal/disposal fees

New 

Metal Vent (New 

Construction)

Combustion Air 

Direct Vent

Concealing Vent 

Pipe 

(Replacement)

• Condensate Pipe

• Drip Pan

• Condensate Pump

• Heat Tape

• Electric Outlet

Stainless Steel 

Venting
71

Life-Cycle Cost and Payback Period Analysis

Installation Location Determination Assumptions

Note: All boilers installed in commercial buildings were assumed to be in 

“other” indoor locations.

Has Basement?

RECS 2009 

House 

Sample

1) Conditioned 

Basement

Yes

Basement 

Finished?

2) Un-Conditioned 

Basement

No Yes

4) Other 

(Indoor)

No

No

3) Garage

Has Garage?

Yes

Installation Location Gas Boilers Oil Boilers

Basement (Conditioned) 35% 40%

Basement (Unconditioned) 27% 49%

Garage 8% 4%

Other Indoor Locations 30% 7%
72

Life-Cycle Cost and Payback Period Analysis

Basic Installation Cost Components (applicable to all installations):

• Trip charge (replacement only)

• Removing old boiler (replacement only)

• Placing and setting up boiler

• Circulating Pump

• Gas/oil piping

• Water piping

• Electrical hookup for thermostat

• Permit and removal/disposal fees

Cost factors: Geographic location of household/building (for labor and material adjustments), 

installation location; installation type (replacement or new construction; residential or new owner)

Basic Installation Costs

Product Class Average Basic Installation 

Costs (2013$)

Gas-Fired Hot Water Boilers $2,741

Gas-Fired Steam Boilers $2,917

Oil-Fired Hot Water Boilers $2,818

Oil-Fired Steam Boilers $2,894
73

Life-Cycle Cost and Payback Period Analysis

Venting Installation Costs

Sources

• 2013 RS Means 

(Residential Cost Data & 

Mechanical Cost Data) 

• DOE’s 2007 Furnace and 

Boiler Final Rule 

• DOE’s 2011 Furnace 

Direct Final Rule

• Manufacturer literature

Orphaned

Water Heater 

(Replacement)

New PVC Venting

Chimney Relining 

(Replacement)

Metal Vent 

Modification 

(Replacement)

Venting 

Installation

Costs

Non-Condensing Boiler

Condensing Boiler

New 

Metal Vent (New 

Construction)

Combustion Air 

Direct Vent

Concealing Vent 

Pipe 

(Replacement)

Stainless Steel 

Venting

Cost factors: Installation location; installation 

type (replacement or new construction); vent 

material type (metal, stainless steel, or plastic); 

chimney type; direct vent (two-pipe or 

concentric).
74

Life-Cycle Cost and Payback Period Analysis

Venting Length

Horizontal 

Distance

RECS 

2009/CBECS 

2003 Data

Vent Size X 1.5 

Distance from 

Furnace 

to Roof

Floor Height

Number of 

Floors Above 

Boiler

Vertical 

Length

= Floor Height X # of Floors Above Boiler

+ Floor Height – 4 ft

+ 3 ft distance above roof

+ Cathedral ceiling height for attic installations

Cathedral 

Ceiling

High Ceiling

Applied to attic 

installations 

only

NAHB Floor 

Height Data

Number of 

Floors

Horizontal

Length

Horizontal 

Distance

Vertical 

Distance

Avg Wall to 

Horizontal Vent 

Length Ratio

Install. Location 

Square 

Footage

Assumed square box (average between 

diagonal and side lengths)

Average Wall 

Length

3 feet + Floor 

Height (if 

basement or crawl 

space)

1) Basement of Crawl Space 

= # of Floors

2) Garage and 1⁄2 Indoor

= # of Floors – 1

3) Attic and 1⁄2 Indoor = 0
75

Installation Cost Considerations

• The vent sizes range from 2” to 6” depending on the input capacity of the boiler.

• Masonry chimney requires relining if:

– Household has a chimney; and

– Boiler was installed or building built before 1995 (based on the National Fuel Gas Code ).

• Venting resizing and vent connectors might be required if:

– Chimney does not need to be relined and 

– Household has an existing natural draft boiler or last boiler replacement before 2020

• Sources: RECS 2009 – boiler age vintage, with historical shipments existing AFUE from AHRI data

• Stainless Steal Venting

– Assumed to be half the fraction of models with a induced/forced draft fan:

Life-Cycle Cost and Payback Period Analysis

Venting in Replacement Cases: Non-Condensing to Non-Condensing

AFUE HWGB SGB HWOB SOB

82% 11% 3% NA 9%

83% 18% 6% NA NA

84% 18% NA 15% 9%

85% 32% NA 26% 11%

86% NA NA 32% 11%
76

Installation Cost Considerations

• Replacing metal vent with PVC flue vent:

– DOE assumed that 75% of installations would install a 2” polyvinyl chloride (PVC), polypropylene 

(PP), or chlorinated polyvinyl chloride (CPVC) vent instead of a 3” vent. DOE also assumed that 

75% of installations would install a PVC or PP vent compared to 25% installing a CPVC vent.

– Boiler location; House ceiling height and number of floors

– Boiler distance from wall or roof, vertical or horizontal vent

– Wall type, which determines the cost of penetrating the wall

– Vent terminations accounted for in vertical and horizontal installations

• Combustion air vent for direct-vent installations:

– Vent length (same as flue pipe length).

– Vent installation fraction, which depends on the installation location.

• Concealing vents in indoor installations:

– Assumed half of the indoor horizontally-vented installations would require vent pipe concealing.

• Orphaned water heaters:

– Some installations need to re-line the chimney and/or resize venting when a condensing boiler 

replaces an existing non-condensing gas boiler that is commonly vented with a gas water heater.

Life-Cycle Cost and Payback Period Analysis

Venting in Replacement Cases: Non-Condensing to Condensing
77

Life-Cycle Cost and Payback Period Analysis

Replacement Venting Installation Cost Fractions for Boilers

Existing Boiler Replacement 

Boiler Installation Requirement Frequency

Chimney installed before 1990 80+% AFUE Relining unlined chimneys 100% 

Natural Draft 80+% AFUE

Installing New Vent Connectors 

(Converting from single-wall to Type B 

double-wall)

75%

Natural Draft 80+% AFUE Resizing Vent System 10% 

Non-Condensing 80+% AFUE Stainless Steel Venting Varies with efficiency 

level

Non-Condensing to Condensing Boilers Installations

Existing NonCondensing Boiler Replacement Installation Requirement Frequency of Applying 

Requirements

Natural Draft Condensing Convert Water Heater from single wall 

to B Type vent Connector 100%

Natural Draft Condensing Resizing Orphaned Water Heater 

Chimney or upgrading Metal Vent 40%

Natural Draft Condensing Reline all unlined chimneys for 

Orphaned Water Heater 100%

Fan Assisted Condensing Resizing Orphaned Water Heater 

Chimney or upgrading Metal Vent 20%

Non-Condensing to Non-Condensing Boilers Installations
78

Life-Cycle Cost and Payback Period Analysis

Replacement Venting Installation Cost for Boilers

Non-Condensing to Non-Condensing Hot Water Gas Boilers Installations

Product 

Class EL Vent Resizing

Vent 

Connector

Chimney 

Relining

New 

Stainless 

Steel Vent

Installation 

Fraction

82% AFUE - Baseline 0.3% 2.2% 5.7% 11.0%

83% AFUE - Increased HX Area 0.2% 2.1% 5.2% 17.9%

84% AFUE - Increased HX Area 0.2% 2.1% 5.2% 17.9%

85% AFUE - Increased HX Area 0.2% 1.8% 4.3% 30.8%

Average Cost 

(2013$)

82% AFUE - Baseline $1,495 $277 $1,596 $533

83% AFUE - Increased HX Area $1,505 $278 $1,601 $529

84% AFUE - Increased HX Area $1,505 $278 $1,601 $529

85% AFUE - Increased HX Area $1,433 $279 $1,586 $529

Product 

Class EL Total Average Venting Cost (2013$)

Hot Water 

Gas Boilers

82% AFUE - Baseline $159

83% AFUE - Increased HX Area $187

84% AFUE - Increased HX Area $187

85% AFUE - Increased HX Area $238
79

Life-Cycle Cost and Payback Period Analysis

Replacement Venting Installation Cost for Boilers

Non-Condensing to Condensing Boilers Installations

Installation Cost Components

Gas-Fired Hot Water 

Boilers

Oil-Fired Hot Water 

Boilers

Fraction of 

Installations

Average 

Cost 

(2013$)

Fraction of 

Installations

Average 

Cost 

(2013$)

Flue Vent (Plastic) 100% $431 100% $437

Combustion Vent 58% $322 54% $357

Concealing Vent 15% $424 9% $434

Chimney Relining for Orphaned Water 

Heater 2.4% $840 1.0% $883

Vent Resizing for Orphaned Water Heater 0.6% $784 0.2% $918

Vent Connector for Orphaned Water 

Heater 3.5% $132 1.8% $139

Weighted Average Installation Cost $776 $729
80

Installation Cost Considerations

• Non-condensing boilers: 

– New flue vent (metal vent, including a fraction of stainless steel vent). 

• Condensing gas boilers: 

– New flue vent (PVC), 

– Combustion air vent for direct vent installations (PVC), 

– accounting for a commonly vented water heater. 

• Condensing boiler venting cost for installations with orphaned water heaters 

added half of the venting system installation cost of the orphaned water heater.

Life-Cycle Cost and Payback Period Analysis

Venting in New Construction/New Owner Installations
81

Life-Cycle Cost and Payback Period Analysis

New Construction/New Owner Venting Installation Cost Fractions for Boilers

Condensing Boilers Installations

Non-Condensing Boilers Installations

Installation Cost Components Gas-Fired Hot Water Boilers Oil-Fired Hot Water Boilers

Fraction Average Cost Fraction Average Cost

Flue Vent 100% $394 100% $374

Combustion Vent 60% $290 52% $300

Concealing Vent 16% $378 5.5% $393

Orphaned Water Heater 20% $446 11% $491

Total $717 $606

Product Class EL

Metal Vent System Stainless Steel Total

Fraction Average 

Cost Fraction Average Cost

Average 

Cost

Gas-Fired Hot 

Water Boilers

82% AFUE - Baseline 89% $1,731 11% $544 $1,600

83% AFUE - Increased HX Area 83% $1,732 17% $541 $1,532

84% AFUE - Increased HX Area 83% $1,732 17% $541 $1,532

85% AFUE - Increased HX Area 70% $1,735 30% $541 $1,375

Oil-Fired Hot 

Water Boilers

84% AFUE - Baseline 85% $2,259 15% $805 $2,041

85% AFUE - Increased HX Area 74% $2,152 26% $784 $1,796

86% AFUE - Increased HX Area 68% $2,161 32% $776 $1,718
82

Installation 

Location of 

Boiler

Condensate 

Pipe

Condensate 

Removal 

Costs

Condensate 

Pump

Has No

Central AC

Electrical 

Outlet

Condensate 

Neutralizer

Applied 

50% of the 

time

Applied 

25% of the 

time

= 1.5 ft pipe 

applicable to all 

installations

Applied 

12.5% of 

the time

Condensate Withdrawal Methodology

Life-Cycle Cost and Payback Period Analysis
83

Life-Cycle Cost and Payback Period Analysis

Condensing Boiler: Condensate Removal

Installation Cost 

Description Description Criteria

Condensate Pipe Deposit condensate down drain. 100% of installations

Condensate 

Pump

If a drain is not near the furnace, then the 

condensate must be pumped to a remote drain. 

25% of replacement installations 

without CAC

Condensate 

Neutralizer Neutralizes condensate before disposal. 12.5% of installations

Electrical Outlet 

(additional) 

Required for some installations to operate 

condensate pump or heat tape.

50% of installations requiring a 

condensate pump

Installation Cost 

Components

Gas-Fired Hot Water Boilers Oil-Fired Hot Water Boilers

Fraction of 

Installations Average Cost Fraction of Installations Average Cost

Condensate Pipe 100% $19 100% $18

Condensate Pump* 18% $268 23% $266

Condensate Neutralizer 12.5% $117 12.5% $116

Electrical Connection* 9% $181 11% $178

Total $98 $113

Condensate Removal Installation Costs (2013$)

* Replacements only.
84

Life-Cycle Cost and Payback Period Analysis

Average Total Installed Cost Results

Product 

Class Efficiency Level

Consumer 

Price 

(2013$)

Installation 

Cost 

(2013$)

Total 

Installed 

Cost 

(2013$)

Incremental 

Cost 

(2013$)

Gas-Fired 

Hot Water 

Boiler

82% AFUE - Baseline $2,103 $3,301 $5,405 -

83% AFUE - Increased HX Area $2,145 $3,302 $5,447 $42 

84% AFUE - Increased HX Area $2,159 $3,302 $5,461 $56 

85% AFUE - Increased HX Area $2,289 $3,295 $5,585 $180 

90% AFUE - Condensing Baseline $2,889 $3,599 $6,488 $1,083 

92% AFUE - Increased HX Area $3,168 $3,599 $6,768 $1,363 

96% AFUE - Max Tech $3,923 $3,599 $7,523 $2,118 

Gas-Fired 

Steam 

Boiler

80% AFUE - Baseline $2,532 $3,037 $5,569 -

82% AFUE - Increased HX Area $2,571 $3,050 $5,621 $52 

83% AFUE - Max Tech $2,867 $3,061 $5,928 $359 

Oil-Fired 

Hot Water 

Boiler

84% AFUE - Baseline $4,020 $3,069 $7,089 -

85% AFUE - Increased HX Area $4,211 $3,121 $7,332 $243 

86% AFUE - Increased HX Area $4,380 $3,147 $7,527 $438 

91% AFUE - Condensing (Max Tech) $5,893 $3,662 $9,555 $2,466 

Oil-Fired 

Steam 

Boiler

82% AFUE - Baseline $4,054 $3,074 $7,128 -

84% AFUE - Increased HX Area $4,348 $3,074 $7,422 $294 

85% AFUE - Increased HX Area $4,499 $3,081 $7,579 $451 

86% AFUE - Max Tech $4,792 $3,081 $7,873 $745 
85

Purpose: Develop average marginal monthly prices for each household/building. 

Methodology: Multiply most current regional average annual energy prices by monthly 

price factors, marginal price factors, and household/building price factors. 

• 2012 average annual energy prices by geographical area based on:

‒ Electricity: EIA’s 2012 Form 826 data

‒ Natural Gas: EIA’s 2012 Natural Gas Navigator monthly

‒ Oil and LPG: EIA’s 2012 State Energy Consumption, Price, and Expenditures Estimates

• Monthly energy price factors by geographical area based on:

‒ Electricity: EIA’s 1990-2012 Form 826 monthly data

‒ Natural Gas: EIA’s 1989-2012 Natural Gas Navigator monthly data 

‒ Oil and LPG: EIA’s 2009 Short Term Energy Outlook 1995-2009 historical data

• Marginal energy price factors for electricity and natural gas by geographical area based on:

• EIA’s 2003-2012 monthly data (Form 826 for electricity and Natural Gas Navigator) 

• Household/building energy price factors based on RECS 2009 and CBECS 2003 billing data.

Life-Cycle Cost and Payback Period Analysis

Energy Prices
86

Methodology: 2012 average monthly marginal energy prices for each household are 

multiplied by projected annual energy price trends for the corresponding Census Division

• 2020-2040 trends based on EIA’s AEO 2013 by Census Division

• After 2040 trends based on Federal Energy Management Program (FEMP) guidelines 

Life-Cycle Cost and Payback Period Analysis

Energy Price Trends

National Residential Energy Price Forecasts
87

Life-Cycle Cost and Payback Period Analysis

Repair and Maintenance

Repair Cost: Cost of replacing or repairing components in the boiler that have failed.

– Primary Sources: 2013 RS Means Data and product costs from engineering analysis

– Cost assumptions, component lifetime, and repair rates:

Maintenance Cost: Labor and materials required to maintain product.

– Costs: Based on 2013 RS Means Data

– Maintenance Frequency: Based on RECS 2009 and CBECS 2003 (together with Decision 

Analysts 2008 American Home Comfort Study)

– Accounted for additional maintenance costs associated with condensing designs 

• Condensate withdrawal system and condensate neutralizer.

• Impacts of low-sulfur fuel oil regulations on frequency of secondary heat exchanger cleaning.

– 61% of oil-fired boilers would be impacted by low-sulfur fuel oil regulations by 2020 based on EIA data.

Repair Description Average 

Lifetime

Repair

Rates

Bare Material 

Cost (2013$)

Total Labor 

Hours

Other* (for Non-Condensing Boiler) 12.2 50% $50.00 2.5

Other* (for Condensing Boilers) $75.00 3.0

Mechanical Vent 15.0 25% $50.00 2.0

Induced/Forced Draft Blower $100.00 3.5

* Ignition, Controls, Gas Valve, Automatic Means 
88

Life-Cycle Cost and Payback Period Analysis

Repair and Maintenance Results

Equipment Class Efficiency Level

Repair Cost (2013$) Maintenance Cost (2013$)

Annualized Incremental Annualized Incremental

Gas-Fired Hot 

Water Boiler

82% AFUE - Baseline $7.87 - $83 -

83% AFUE - Increased HX Area $8.11 $0.24 $83 $0 

84% AFUE - Increased HX Area $8.11 $0.24 $83 $0 

85% AFUE - Increased HX Area $8.55 $0.68 $83 $0 

90% AFUE - Condensing Baseline $10.59 $2.71 $86 $3 

92% AFUE - Increased HX Area $10.59 $2.71 $86 $3 

96% AFUE - Max Tech $10.59 $2.71 $86 $3 

Gas-Fired Steam 

Boiler

80% AFUE - Baseline $7.56 - $81 -

82% AFUE - Increased HX Area $7.65 $0.08 $81 $0 

83% AFUE - Max Tech $7.74 $0.18 $81 $0 

Oil-Fired Hot 

Water Boiler

84% AFUE - Baseline $7.83 - $128 -

85% AFUE - Increased HX Area $8.23 $0.39 $128 $0 

86% AFUE - Increased HX Area $8.41 $0.58 $128 $0 

91% AFUE - Condensing $10.38 $2.55 $139 $11 

Oil-Fired Steam 

Boiler

82% AFUE - Baseline $7.82 - $130 -

84% AFUE - Increased HX Area $7.82 $0.00 $130 $0 

85% AFUE - Increased HX Area $7.85 $0.04 $130 $0 

86% AFUE - Max Tech $7.85 $0.04 $130 $0 
89

Definition: Age when the residential boiler is retired from service.

Methodology: Lifetime distribution calculated using national survey data (multiple 

years of RECS and American Housing Survey (AHS)) and shipment data (see Ch. 9).

• Reference: J D. Lutz, et al., “Using National Survey Data to estimate lifetimes of 

residential appliances. HVAC&R Research” (Oct. 3, 2011).

Results: Mean lifetime: 25 years; same lifetime for all product classes, design options.

Life-Cycle Cost and Payback Period Analysis

Lifetime
90

Purpose: Used to determine the present value of lifetime operating expenses.

Method: 

• Residential: Derived from various types of debt and equity using the Federal Reserve 

Board’s Survey of Consumer Finances (1995-2010).

• Commercial: Calculated as the weighted average cost of capital (WACC), using the 

Capital Asset Pricing Model (CAPM) for different economic sectors. (Damodaran Online)

Results: Overall average = 4.49

Life-Cycle Cost and Payback Period Analysis

Discount Rates

Residential 

Installations -

Income Group

Mean 

Discount 

Rate (%)

1 4.85

2 5.12

3 4.75

4 4.04

5 3.80

6 3.57

Commercial 

Installations –

Economic Sectors

Mean 

Discount 

Rate (%)

Standard 

Deviation 

(%)

Retail 4.30 2.09

Property owners 5.16 1.30

Medical services 4.19 1.86

Industrial 4.95 2.18

Lodging 5.88 2.28

Food Service 4.84 2.60

Offices 5.40 1.85

State/Local Govt/Edu 2.46 2.15

Federal Government 3.30 1.36

Other 4.35 1.64
91

Purpose: Reflects the projected market share of products at different efficiency levels in 

the base case (in the absence of standards).

• Not all consumers purchase products at current minimum standard. Consumers already 

purchasing products at efficiencies greater than or equal to a prospective standard level are 

not impacted by the standard.

Methodology: Based on boiler certification directories and shipments data. 

• Develop historical distribution by efficiency level and product class for 2013 based on:

• AHRI and Energy Star shipments data from 2003-2012 (see appendix 8-H) 

• Estimated historical shipments (see chapter 9)

• AHRI, CEC, Energy Star, and NRCAN boiler certification directories (see appendix 7-D)

• Assumed new ENERGY STAR® performance criteria* will increase condensing market shares:

• 32% in 2013 to 46% in 2020 for HWGBs; and 4% in 2013 to 8% in 2020 for HWOBs

• For gas-fired hot water boilers, accounted for regional differences.

• For standby mode/off mode standards, assumed 50% at EL 0 and 50% at EL 3.

* New performance criteria (October 1, 2014): 90-percent AFUE for gas-fired boilers 

and 87-percent AFUE for oil-fired boilers.

Life-Cycle Cost and Payback Period Analysis

Base-Case Efficiency Distribution
92

Life-Cycle Cost and Payback Period Analysis

Historical and Projected Condensing Market Share 

from 2000-2050
93

Product Class EL Design Option 2013 Market Share 2020 Market Share

Gas-fired Hot 

Water Boiler

0 82% AFUE – Baseline 25.7% 20.6%

1 83% AFUE – Increased HX Area 13.4% 10.7%

2 84% AFUE – Increased HX Area 15.2% 12.1%

3 85% AFUE – Increased HX Area 13.4% 10.8%

4 90% AFUE – Condensing Baseline 11.5% 16.3%

5 92% AFUE – Increased HX Area 15.8% 22.3%

6 96% AFUE – Max Tech 5.1% 7.2%

Gas-fired Steam 

Boiler

0 80% AFUE – Baseline 13.9% 13.9%

1 82% AFUE – Increased HX Area 75.3% 75.3%

2 83% AFUE – Max Tech 10.8% 10.8%

Oil-fired Hot 

Water Boiler

0 84% AFUE – Baseline 19.4% 18.6%

1 85% AFUE – Increased HX Area 33.3% 31.9%

2 86% AFUE – Increased HX Area 43.3% 41.5%

3 91% AFUE – Max Tech 4.0% 8.1%

Oil-fired Steam 

Boiler

0 82% AFUE – Baseline 28.8% 28.8%

1 84% AFUE – Increased HX Area 34.2% 34.2%

2 85% AFUE – Increased HX Area 27.4% 27.4%

3 86% AFUE – Max Tech 9.7% 9.7%

Life-Cycle Cost and Payback Period Analysis

2013 and 2020 Base-Case Efficiency Distributions
94

Life-Cycle Cost and Payback Period Analysis

2008-2012 and 2020 Condensing Market Share 

by Census Division for Gas-Fired Hot Water Boilers

ID Census Division 

Fraction of Condensing 

Gas-fired Hot Water Boiler 

Shipments (2008-2012)

Projected 2020 Fraction of 

Condensing Gas-fired Hot 

Water Boiler Shipments

1 New England 41.3% 65.9%

2 Middle Atlantic 15.0% 23.9%

3 East North Central 36.1% 57.7%

4 West North Central 44.4% 71.0%

5 South Atlantic 27.7% 44.2%

6 East South Central 38.2% 61.1%

7 West South Central 56.2% 89.8%

8 Mountain 61.5% 98.3%

9 Pacific 64.0% 100.0%

United States 28.6% 45.8%
95

Example: Gas-Fired Hot Water Boilers

Life-Cycle Cost and Payback Period Analysis

LCC and PBP Analysis Results

EL AFUE

Life-Cycle Cost (2013$) Life-Cycle Cost Savings Median 

Payback 

Period 

(years)

Average 

Installed Cost

Average 

Lifetime 

Operating Cost

Average 

LCC

Average 

Savings 

(2013$)

% Households with

Net

Cost No Impact Net Benefit

0 82% $5,405 $22,047 $27,452 NA 0% 100% 0% NA

1 83% $5,447 $21,837 $27,284 $35 4% 79% 18% 1.6

2 84% $5,461 $21,616 $27,077 $100 3% 68% 29% 1.6

3 85% $5,585 $21,431 $27,016 $123 13% 57% 30% 7.7

4 90% $6,488 $20,387 $26,875 $142 31% 46% 23% 21.6

5 92% $6,768 $20,022 $26,790 $201 38% 29% 33% 18.8

6 96% $7,523 $19,338 $26,860 $134 57% 7% 36% 22.1
96

Purpose: Evaluate impacts on customers who may be disproportionately affected by a 

proposed national energy conservation standard. 

• DOE evaluated LCC and Payback Period impacts on low-income households* and 

households occupied by senior citizens only (senior-only households).

* In this LCC analysis, all households pay the full cost of more-efficient boilers and fully benefit from lower energy bills. However, 

most low-income households are tenants who benefit from lower energy bills, but rent increases may not fully cover higher 

equipment cost. Overall, tenants are probably better off than suggested by LCC results.

Life-Cycle Cost and Payback Period Analysis

Consumer Subgroup Analysis

Product Class Efficiency 

Level

Average LCC Savings Median Payback Period

2013$ Years

Low-Income Senior All Low-Income Senior All

Gas-Fired Hot 

Water Boiler

1 $24 $27 $35 1.5 1.8 1.6

2 $79 $76 $100 1.5 1.9 1.6

3 $82 $73 $123 9.1 9.9 7.7

4 -$146 -$44 $142 30.1 23.9 21.6

5 -$128 -$34 $201 22.3 20.6 18.8

6 -$294 -$202 $134 23.7 24.5 22.1

Gas-Fired Steam 

Boiler

1 $53 $50 $61 1.3 1.7 1.3

2 $180 $160 $250 11.1 13.0 11.6

Oil-Fired Hot 

Water Boiler

1 $25 $58 $72 9.8 7.9 8.3

2 $103 $234 $257 10.9 6.3 7.6

3 -$1,019 $75 $273 47.5 19.8 21.4

Oil-Fired Steam 

Boiler

1 $120 $8 $259 9.5 1.0 6.3

2 $227 $9 $506 10.1 1.0 6.7

3 $247 $13 $723 15.7 1.0 10.5
97

Issue 4-12: DOE requests comments on the approach and data sources 

used for assessing changes in installation costs for more-efficient 

residential boilers.

Life-Cycle Cost and Payback Period Analysis

Request for Comment

Issue 4-10: DOE requests comment on the reasonableness of its 

assumption apply a constant trend to the manufacturer selling price of 

residential boilers, as well as any information that would support the 

use of alternative assumptions.

Issue 4-11: DOE requests data that would allow for use of different 

price trend projections for condensing and non-condensing boilers.

Issue 4-13: DOE requests comment on the fraction of boilers that use 

polypropylene, PVC, or chlorinated polyvinyl chloride (CPVC) venting.

Issue 4-14: DOE requests comment on the fraction of boilers that 

require stainless steel venting (by efficiency level).
98

Issue 4-18: DOE requests comment on its projections of the market 

share of high-efficiency (condensing) boilers in 2020 in the absence of 

amended energy conservation standards, as well as the long-term 

market penetration of higher-efficiency residential boilers.

Issue 4-17: DOE requests comments on the methodology for 

estimating discount rates for consumers of residential boilers.

Issue 4-20: DOE invites comments and recommendations on any other 

aspects related to the Life-Cycle Cost and Payback Period analysis.

Life-Cycle Cost and Payback Period Analysis

Request for Comment

Issue 4-19: DOE requests comment on the fraction of boilers at each 

standby mode/off mode efficiency level.

Issue 4-16: DOE requests comments on the approach used to 

determine the lifetimes for residential boilers.

Issue 4-15: DOE requests comments on the methodology and data 

sources used for assessing changes in maintenance and repair costs for 

more-efficient residential boilers.
99

Public Meeting Agenda

1 Overview

2 Market & Technology Assessment; Screening Analysis

3 Engineering Analysis

4 Markups Analysis and Energy Use Characterization

5 Life-Cycle Cost and Payback Period Analysis

6 Shipments, National Impact Analysis, RIA

7 Manufacturer Impact Analysis

8 Environmental Impacts; Indirect Employment

9 Closing Remarks and How to Submit Comments
100

Shipments and National Impact Analyses

Framework

Document

Preliminary

Activities NOPR Final

Rule

Effective

Date

Steps for the Standards Rulemaking: Preliminary Activities and 

Analyses

Shipments 

Analysis

Preliminary 

Manufacturer 

Impact Analysis

Life-Cycle

 Cost and 

 Payback

 Period

 Analyses

National Impact 

Analyses

Market & 

Technology 

Assessment

Screening 

Analysis

Engineering

Analysis

Markups to

 Determine 

 Product Price

Energy Use 

Characterization
101

Shipments Analysis

Purpose

• Forecast the residential boilers that would be expected to be shipped between 

2020 and 2049 with and without energy conservation standards in order to 

calculate the national impacts of potential amended energy conservation 

standards on energy use, NPV, and future manufacturer cash flows. 

Method

• Shipment Projections: Estimate the number of residential boilers shipped 

annually by product class and market segment:

‒ New Construction: New construction projections multiplied by new construction 

market saturations. Determined using new building construction projections and 

historical market shares.

‒ New Owners*: Difference between total historical shipments and modeled new 

construction and replacement shipments. 

‒ Replacements: Survival function applied to product stock. Historical shipments used to 

generate product stock (demolished units removed from stock). Survival function 

based on product lifetime. 

• Impact of Standards: Accounted for impact on shipments using price elasticities.

− Consumer purchase decisions influenced by purchase price and operating cost.

− Some consumers may choose to repair rather than replace residential boiler.

* Existing buildings that acquire a boiler for the first time and also includes switching 

between different boiler product classes.
102

New

Construction Average Boiler 

Saturation in New 

Construction

New Housing

Starts

Annual Shipments

Residential Boiler 

Retirement Function

Total Shipments New

Owners

Differential between 

Historic vs. Modeled 

Shipment Data 

Switching*

Replacement

Shipments

* Switching to other residential boiler product classes (such as oil- to gas-fired boilers or hot water to steam boilers).

** Based on year-to-year changes to projected housing stock.

Shipments Analysis

Shipments Analysis Flowchart

Demolitions**
103

Shipments Analysis

Shipments Model Inputs

Input Description/Source

Housing Starts/

Commercial Building SqFt

• U.S. Census historical housing starts data up to 2012

• EIA’s AEO 2013 historical data and projections

New Construction 

Saturations

• Historical saturations from Characteristics of New Housing data from U.S. 

Census Bureau, RECS 2009, and CBECS 2003

Shipments to New 

Owners (Including 

Adjustment for Product 

Switching) 

• Used 2008-2012 historical shipments and shipments model estimates. New 

owners derived as the difference between historical shipments and modeled 

new construction and replacement shipments. 

• Most new owners are assumed to be switching between product classes 

• For HWGB, assumed that a fraction of new owners are new boiler 

installations in existing buildings that did not have a boiler previously.

Historical Annual 

Shipments

• Appliance Magazine 1960-2008 shipments for gas and oil boilers

• AHRI 1970-2012 shipments (some years by product class)

• The above historical shipments data adjusted to disaggregate between 

product classes; exclude fraction of commercial boiler shipments; include all 

boiler types; and include all residential boiler manufacturers. 

Retirement Function • Assumed to have the form of a cumulative Weibull distribution based on 

lifetime distribution (avg. 25 yrs) for all boilers within scope. (see Ch.8). 

Fraction of Shipments to 

Commercial Applications

• 7% of residential boiler shipments assumed to be installed in commercial 

applications (derived from EIA RECS 2009 and CBECS 2003 data)
104

Shipments Analysis

Historical Shipments Flowchart

Cast Iron

Residential 

Hot Water Cast-Iron

Boiler Fraction

Residential Steam 

Boiler Fraction

Total Shipments

High Efficiency 

(Condensing)

Annual 

AHRI/Appliance 

Magazine Shipments

Steam Boilers

Hot Water Boilers

Coil and Tube Type

Non-AHRI 

Shipments 

Fraction

Steel

2003-2012 

AHRI 

Shipments 

Submittal

Energy Star Data

Reduced Boiler 

Model Data Set
105

• DOE adjusted Appliance Magazine and AHRI historical shipments (ShipTotal) as follows:

– Cast-Iron shipments (ShipTotal * FracRes,HW or Steam)

• Disaggregated shipments by product class*

– Other boiler types shipments (ShipOtherTypes)

• Steel boiler shipments

– Estimated to be 0.1% of HWGB shipments (based on 1993 AHRI shipment data) 

– Steel HWOB shipments*:

» From 1960 to 2002, estimated by subtracting cast-iron HWOB from total HWOB shipments 

» From 2003 to 2009, provided by AHRI

» From 2010 to 2012, estimated by using a linear trend of 2003 to 2009 data

• Coil and tube type shipments for HWGBs 

– From 1960 to 2002, estimated to be 7.2% of HWGB shipments (based on 2003-2007 AHRI data)

– From 2003 to 2012, coil and tube type shipments provided by AHRI

• High-efficiency (condensing) boiler shipments 

– For HWGB from 2005 to 2012, shipments data provided by AHRI

– For HWOBs and all other years for HWGB, based on historical efficiency data

– Non-AHRI manufacturer shipments (AdjFactorNon-AHRI)

• Estimated to be 13.3% of HWGB and 26.5% of HWOB shipments in 2013

* Excluding commercial boiler shipments (assumed to be boilers with output capacity above 250 kBtu/h)

Shipments Analysis

Derivation of Historical Shipments

  ; ShipRes,HW  ShipTotal  FracRes,HW  ShipOtherTypes  AdjFactorNonAHRI ShipRes,Steam  ShipTotal  FracRes,Steam
106

Historical and Projected Base-Case Shipments for Residential Boilers by 

Product Class, 1960-2049

Shipments Analysis

0.0

0.1

0.2

0.3

0.4

0.5

0.6

Shipments (million)

Gas-fired Hot Water Boiler Gas-fired Steam Boiler Oil-fired Hot Water Boiler

Oil-fired Steam Boiler Electric Hot Water Boiler Electric Steam Boiler

Historical Projected
107

Total Projected Shipments of Residential Gas-Fired Hot Water Boilers in the 

Base Case and Each Standards Case, 2020-2049

Shipments Analysis

0.20

0.25

0.30

0.35

Shipments (million)

Base TSL 1 TSL 2

TSL 3 TSL 4 TSL 5
108

Issue 5-1: DOE requests comments on the methodology and data 

sources used for projecting shipments of residential boilers in the 

absence of amended energy conservation standards.

Shipments Analysis

Request for Comment

Issue 5-3: DOE welcomes comment on its approach for accounting for 

the impact of standards on shipments using price elasticities to 

estimate the fraction of consumers choosing to repair rather than 

replace.

Issue 5-2: DOE requests comment on the potential impacts of fuel and 

equipment switching on product shipments with and without 

amended standards.
109

National Impact Analyses

Purpose

• Estimate national impacts of energy conservation standards for residential 

boilers shipped between 2020 and 2049.

– National Energy Savings (NES): Primary and Full-Fuel-Cycle (FFC) energy savings.

– Net Present Value (NPV): Difference between the present value of annual operating 

cost savings and the present value of annual total installed cost increase.

Methodology

• For each product class and standard cases:

1. Calculate per-unit energy savings, per-unit total installed cost increase, and perunit operating cost savings.

2. Calculate number of units (stock) in use installed from 2020 to 2049 .

3. Combine the above to determine NES and NPV.
110

National Impact Analyses

* Over lifetime of products shipped from 2020-2049.

Note: Energy Consumption accounts for heating load trends from AEO 2013. 

Standards-Case Energy Consumption accounts for the rebound effect.

National Energy Savings

Standards-Case 

Cumulative Energy 

Use*

Base-Case Annual Energy 

Consumption

Shipments Analysis

Base-Case Cumulative 

Energy Use*

National Energy 

Savings

Site to Primary/FFC Energy 

Conversion

Standards-Case Annual 

Energy Consumption

Standards-Case 

Projection

Base-Case 

Projection
111

National Impact Analyses

Net Present Value

Standards-Case 

Projection

Base-Case 

Projection

Cumulative Total Installed 

Cost Increase*

Energy Cost

Net Present 

Value

Discount Rate Cumulative Operating 

Cost Savings*

Shipments Analysis

Maintenance and 

Repair Cost

Total Installed 

Cost Energy Cost Maintenance and Repair Cost

Total Installed 

Cost

* Over lifetime of products shipped from 2020-2049.

Note: Energy Cost accounts for heating load and energy price trends from AEO 2013. 

Total Installed Cost accounts for equipment price trends from PPI data.
112

Input Description

Shipments Projected shipments for each product class under the base case and all standards cases.

Product Stock Determined yearly stock using annual shipments and lifetime for each product class.

Base and Standards Cases 

Efficiency Distributions

Developed a distribution of efficiencies in the base case for 2020 from LCC analysis results. 

For the base case, assumes growth in condensing boilers market share. In each standards 

case, “roll-up” scenario is used to establish the efficiency distribution. 

Annual Unit Energy 

Consumption

Function of product efficiency for each product class from LCC analysis results. Takes into 

account heating load trends from 2020-2049. (AEO 2013)

Rebound Effect Applied 15% to NES based on various sources.

Site-to-Power Plant 

Conversion Factor

Converts site energy into primary (power plant) energy consumption. (AEO 2013)

Full-Fuel-Cycle Account for energy used for resource extraction and distribution losses. (based on AEO 2013)

Total Installed Cost Per Unit Function of product efficiency for each product class based on LCC analysis. Calculated by 

vintage. Takes into account equipment price trends from 2020-2049. (PPI data)

Total Operating Cost Per 

Unit

Includes costs for energy, maintenance , and repair derived as a function of product 

efficiency for each product class from LCC analysis. Calculated by vintage. Takes into account 

heating load and energy price trends. (AEO 2013)

Discount Rate Used to determine present value of future monetary values. 7% and 3% real from OMB’s 

Regulatory Analysis Guideline (OMB Circular A-4).

National Impact Analyses

National Impact Analyses (NIA) Inputs
113

• Base-Case Distribution from 2020 to 2049:

– LCC analysis outputs the 2020 distribution values by product class, market segments 

(replacements/new owners, new construction), and residential/commercial 

applications

– Assumed ENERGY STAR® performance criteria* will increase condensing market shares:

• 46% in 2020 to 65% in 2049 for HWGBs

• 8% in 2020 to 16% in 2049 for HWOBs

– Estimated that the market shares of condensing gas-fired and oil-fired steam boilers 

would be negligible during analysis period.

– For standby mode and off mode analysis, DOE estimated that the market shares by EL 

would remain constant over the period of analysis for all product classes.

• Standards-Cases Distribution from 2020 to 2049:

– Products below the standard under consideration would “roll up” to meet the new 

standard level. Products at or above the standard under would not be affected.

* New performance criteria (October 1, 2014): 90-percent AFUE for gas-fired boilers and 87-percent AFUE for oil-fired boilers.

National Impact Analyses

Base-Case and Standards-Cases Efficiency Distributions
114

National Impact Analyses

Condensing Market Share Trends from 2020-2049

(without amended standards)

Projection of Base Case Market Share for Condensing 

Gas-Fired Hot Water Residential Boilers, 2020-2049

Projection of Base Case Market Share for Condensing 

Oil-Fired Hot Water Residential Boilers, 2020-2049
115

National Impact Analyses

Projected Market Share by Efficiency Level from 2020-2049

(without amended standards)

Projection of Base Case Market Share for 

Gas-Fired Hot Water Residential Boilers, 2020-2049

Projection of Base Case Market Share for 

Oil-Fired Hot Water Residential Boilers, 2020-2049
116

Product Class Efficiency Level

Market Share (percent)

Base 

Case

Trial Standard Level (TSL)

1 2 3 4 5

Gas-fired Hot 

Water Boiler

0 82% AFUE - Baseline 21.2

1 83% AFUE - Increased HX Area 10.6 31.8

2 84% AFUE - Increased HX Area 11.6 11.6 43.4

3 85% AFUE - Increased HX Area 10.4 10.4 10.4 53.9

4 90% AFUE - Condensing Baseline 16.7 16.7 16.7 16.7

5 92% AFUE - Increased HX Area 22.4 22.4 22.4 22.4 93.0

6 96% AFUE - Max Tech 7.0 7.0 7.0 7.0 7.0 100.0

Gas-fired Steam 

Boiler

0 80% AFUE - Baseline 14.2

1 82% AFUE - Increased HX Area 74.9 89.1 89.1 89.1 89.1

2 83% AFUE - Max Tech 10.9 10.9 10.9 10.9 10.9 100.0

Oil-fired Hot 

Water Boiler

0 84% AFUE - Baseline 19.0

1 85% AFUE - Increased HX Area 31.5 50.5

2 86% AFUE - Increased HX Area 41.5 41.5 92.0 92.0

3 91% AFUE - Condensing (Max Tech) 8.0 8.0 8.0 8.0 100.0 100.0

Oil-fired Steam 

Boiler

0 82% AFUE - Baseline 29.4

1 84% AFUE - Increased HX Area 33.2 62.6

2 85% AFUE - Increased HX Area 27.7 27.7

3 86% AFUE - Max Tech 9.7 9.7 100.0 100.0 100.0 100.0

National Impact Analyses

Efficiency Distributions for the Base Case and Standards Cases in Residential 

Applications in 2020
117

Product Class

Gas-fired Hot Water Boiler 83% 84% 85% 92% 96%

Gas-fired Steam Boiler 82% 82% 82% 82% 83%

Oil-fired Hot Water Boiler 85% 86% 86% 91% 91%

Oil-fired Steam Boiler 84% 86% 86% 86% 86%

National Impact Analyses

Trial Standard Levels (TSLs) – AFUE Standards

TSL3 is Proposed TSL

TSL Selection Criteria for each product class:

• TSL 5: Max-tech efficiency levels

• TSL 4: Yields maximum NES with an NPV greater than zero at 7% discount rate

• TSL 3: Yields maximum NPV at 7% discount rate and for which the percentage of LCC 

winners is higher than the percentage of LCC losers 

• TSL 2: Consists of intermediate efficiency levels

• TSL 1: Consists of the most common efficiency levels in the current market
118

Product Class

Gas-fired Hot Water Boiler 10.0 9.7 9.0

Gas-fired Steam Boiler 9.0 8.7 8.0

Oil-fired Hot Water Boiler 12.0 11.7 11.0

Oil-fired Steam Boiler 12.0 11.7 11.0

Electric Hot Water Boiler 9.0 8.7 8.0

Electric Steam Boiler 9.0 8.7 8.0

National Impact Analyses

TSL3 is 

Proposed TSL

Trial Standard Levels (TSLs) – Standby Mode and Off Mode

TSL Selection Criteria for each product class:

• TSL 3: Switching mode power supply with low-loss transformer

• TSL 2: Switching mode power supply 

• TSL 1: Low-loss transformer
119

National Impact Analyses

AFUE Primary National Energy Savings Results (quads)

Product Class Trial Standard Levels

1 2 3 4 5

Gas-fired Hot Water Boiler 0.030 0.076 0.134 0.735 1.231

Gas-fired Steam Boiler 0.006 0.006 0.006 0.006 0.023

Oil-fired Hot Water Boiler 0.012 0.043 0.043 0.274 0.274

Oil-fired Steam Boiler 0.003 0.009 0.009 0.009 0.009

Total 0.051 0.134 0.192 1.024 1.537

Product Class Trial Standard Levels

1 2 3 4 5

Gas-fired Hot Water Boiler 0.033 0.084 0.148 0.812 1.357

Gas-fired Steam Boiler 0.006 0.006 0.006 0.006 0.025

Oil-fired Hot Water Boiler 0.014 0.050 0.050 0.321 0.321

Oil-fired Steam Boiler 0.003 0.011 0.011 0.011 0.011

Total 0.057 0.151 0.215 1.150 1.714

AFUE Fuel-Fuel-Cycle National Energy Savings Results (quads)
120

National Impact Analyses

Standby Mode/Off Mode Primary National Energy Savings Results (quads)

Standby Mode/Off Mode Fuel-Fuel-Cycle National Energy Savings Results (quads)

Product Class

Trial Standard Levels

1 2 3

Gas-fired Hot Water Boiler 0.0199 0.0238 0.0331

Gas-fired Steam Boiler 0.0023 0.0027 0.0027

Oil-fired Hot Water Boiler 0.0071 0.0071 0.0071

Oil-fired Steam Boiler 0.0005 0.0005 0.0005

Hot Water Electric Boiler 0.0006 0.0006 0.0006

Steam Electric Boiler 0.0001 0.0001 0.0001

Total 0.0304 0.0348 0.0441

Product Class

Trial Standard Levels

1 2 3

Gas-fired Hot Water Boiler 0.0202 0.0242 0.0336

Gas-fired Steam Boiler 0.0023 0.0028 0.0028

Oil-fired Hot Water Boiler 0.0072 0.0072 0.0072

Oil-fired Steam Boiler 0.0005 0.0005 0.0005

Hot Water Electric Boiler 0.0006 0.0006 0.0006

Steam Electric Boiler 0.0001 0.0001 0.0001

Total 0.0309 0.0354 0.0448
121

National Impact Analyses

AFUE Net Present Value Results

Discounted at 3 and 7 Percent (billion 2013$)

Product Class,

3% discount rate

Trial Standard Levels

1 2 3 4 5

Gas-fired Hot Water Boiler 0.173 0.482 0.649 1.860 2.330

Gas-fired Steam Boiler 0.035 0.035 0.035 0.035 0.011

Oil-fired Hot Water Boiler 0.130 0.493 0.493 1.419 1.419

Oil-fired Steam Boiler 0.035 0.107 0.107 0.107 0.107

Total 0.373 1.116 1.284 3.420 3.866

Product Class,

7% discount rate

Trial Standard Levels

1 2 3 4 5

Gas-fired Hot Water Boiler 0.053 0.155 0.176 0.121 -0.238

Gas-fired Steam Boiler 0.011 0.011 0.011 0.011 -0.019

Oil-fired Hot Water Boiler 0.035 0.139 0.139 0.024 0.024

Oil-fired Steam Boiler 0.011 0.031 0.031 0.031 0.031

Total 0.110 0.337 0.358 0.187 -0.202
122

National Impact Analyses

Standby Mode/Off Mode Net Present Value Results

Discounted at 3 and 7 Percent (billion 2013$)

Product Class,

3% discount rate

Trial Standard Levels

1 2 3

Gas-fired Hot Water Boiler 0.253 0.215 0.331

Gas-fired Steam Boiler 0.031 0.027 0.027

Oil-fired Hot Water Boiler 0.104 0.074 0.071

Oil-fired Steam Boiler 0.008 0.006 0.006

Hot Water Electric Boiler 0.006 0.003 0.003

Steam Electric Boiler 0.001 0.000 0.000

Total 0.401 0.326 0.438 

Product Class,

7% discount rate

Trial Standard Levels

1 2 3

Gas-fired Hot Water Boiler 0.104 0.080 0.128

Gas-fired Steam Boiler 0.013 0.010 0.010

Oil-fired Hot Water Boiler 0.044 0.028 0.026

Oil-fired Steam Boiler 0.003 0.002 0.002

Hot Water Electric Boiler 0.002 0.001 0.001

Steam Electric Boiler 0.000 0.000 0.000

Total 0.167 0.122 0.167
123

Request for Comment

Issue 5-4: DOE requests comment on the reasonableness of the value 

(15%) DOE used to characterize the anticipated rebound effect 

associated with amended energy conservation standards for 

residential boilers.

Issue 5-5: DOE invites comments and recommendations from 

interested parties on any aspect relating to National Impact Analysis.

National Impact Analyses
124

Purpose

• Investigate national impacts of non-regulatory alternatives to mandatory amended 

energy conservation standards. 

Method

• Used modified NIA spreadsheet to evaluate non-regulatory alternatives to proposed 

standards:

Output: NES and NPV for non-regulatory alternatives.

Results: No alternative was found to be as beneficial as the proposed energy 

conservation standards. (See chapter 17 of the TSD for methodology and results.)

Regulatory Impact Analysis

• No New Regulatory Action • Manufacturer Tax Credits

• Consumer Rebates • Voluntary Energy Efficiency Targets

• Consumer Tax Credits • Bulk Government Purchases
125

Public Meeting Agenda

1 Overview

2 Market & Technology Assessment; Screening Analysis

3 Engineering Analysis

4 Markups Analysis and Energy Use Characterization

5 Life-Cycle Cost and Payback Period Analysis

6 Shipments, National Impact Analysis, RIA

7 Manufacturer Impact Analysis

8 Environmental Impacts; Indirect Employment

9 Closing Remarks and How to Submit Comments
126

Manufacturer Impact Analysis: Overview

Purpose

• Assess the impacts of amended energy conservation standards on manufacturers. 

• Identify and estimate the impacts on manufacturer subgroups that may be more 

severely affected than the industry as a whole. 

• Examine the direct employment, manufacturing capacity, and cumulative regulatory 

impacts on the industry. 

Method

• Analyze industry cash flow and industry net present value (INPV) through use of the 

Government Regulatory Impact Model (GRIM); and 

• Interview manufacturers to refine inputs to the GRIM, develop subgroup analyses, 

and address quantitative issues. 
127

Manufacturer Impact Analysis: Methodology

Phase 1

• DOE creates an industry profile to characterize the market and identify important 

issues that require further investigation.

Phase 2

• DOE prepares an industry cash-flow model and an interview questionnaire to guide 

subsequent discussions with manufacturers. 

Phase 3

• DOE conducts interviews with manufacturers and assesses the impacts of standards 

both quantitatively (using the GRIM) and qualitatively (impacts on employment, 

competition, manufacturing capacity, and regulatory burden).

• DOE also evaluates subgroups of manufacturers that may be disproportionately 

impacted by standards or that may not be accurately represented by the average 

cost assumptions used to develop the industry cash-flow analysis. 
128

• The potential for a condensing standard to disrupt the replacement market. 

• The impact of condensing efficiency levels on manufacturing jobs and profitability.

• The ability of condensing boilers to perform as rated in real-world installations and 

meet heating distribution needs.

• The potential changes in durability and reliability of higher-efficiency condensing 

boilers relative to lower-efficiency products.

Manufacturer Impact Analysis: Key Issues
129

Manufacturer Impact Analysis: Methodology

Industry Cash-Flow Model

• Upstream Inputs

• Market and Technology Assessment

• Engineering Analysis

• Shipments Analysis

• MIA Inputs

• Markup Scenarios

• Conversion Cost Scenarios
130

• DOE modeled two markup scenarios to capture a range of potential financial 

impacts on the industry:

– Preservation of Gross Margin Percentage Markup Scenario 

• Manufacturers pass through all additional costs to their consumers and 

maintain a gross margin percentage in the standards case. 

– Preservation of Operating Profit Markup Scenario 

• Manufacturers maintain the same total operating profit in absolute dollars 

in the standards case as in the base case, despite a higher level of 

investment. 

Manufacturer Impact Analysis: Markup Scenarios
131

• Capital Conversion Costs 

– One-time investments in plant, property, and equipment

– $0.90 million for the industry at TSL 3 for AFUE standards

– Approximately $.03 million per manufacturer for AFUE standards

• Product Conversion Costs

– One-time investments in R&D, testing, marketing materials, non-equipment 

investments

– $3.38 million for the industry at TSL 3 for AFUE standards

– Approximately $0.09 million per manufacturer for AFUE standards

Manufacturer Impact Analysis: Conversion Costs
132

Manufacturer Impact Analysis: Results

Base Case TSL 1 TSL 2 TSL 3 TSL 4 TSL 5

INPV (2013$ 

millions)

380.96 379.17 

to 

380.91

378.31 

to 

383.35

372.97 

to 

381.73

284.75 

to 

369.87

241.69 

to 

380.46

Change in INPV (%) - (0.47) 

to 

(0.01)

(0.70) 

to 

0.63

(2.10)

to 

0.20

(25.25) 

to 

(2.91)

(36.56) 

to 

(0.13)

Total 

Conversion Costs 

(2013$ millions)

- 1.32 2.59 4.28 85.16 105.00

INPV Results for AFUE Standards

Note: Parentheses indicate negative values.
133

Manufacturer Impact Analysis: Small Business Impacts

• DOE identified 13 companies meeting the SBA definition of a small business that are 

covered by this rulemaking

• 9 are manufacturers

• 4 are private labelers

Conversion

Costs (2013$ 

millions)

Conversion

Costs as a % of 

Revenue over 

conversion 

period

Conversion 

Costs as a % of 

EBIT Over 

Conversion 

Period

% of Products

Requiring 

Redesign at TSL 3

Average small 

manufacturer

$0.11 0.6% 7.6% 48%

Average large 

manufacturer

$0.12 0.1% 1.2% 50%
134

Manufacturer Impact Analysis: Results

Base Case TSL 1 TSL 2 TSL 3

INPV (2013$ 

millions)

380.96 380.77 

to 

380.88

379.94 

to 

381.16

379.88 

to 

381.17

Change in INPV 

(%)

- (0.05) 

to 

(0.02)

(0.27) 

to 

0.05

(0.28) 

to 

0.06

Total 

Conversion Costs 

(2013$ millions)

- 0.21 0.21 0.21

INPV Results for Standby Mode/Off Mode Standards

Note: Parentheses indicate negative values.
135

Request for Comment

Issue 7-1: DOE seeks comment on the number of small manufacturers, 

on the potential impacts of amended energy conservation standards 

on those small manufacturers, and the severity of those impacts. 

Issue 7-2: DOE seeks comment on the potential impact of amended 

standards on the industry, on the need for conversion investments, on 

the key drivers of those conversion investments, and on changes in 

manufacturer pricing and markups due to amended standards. 

Manufacturer Impact Analysis

Issue 7-3: DOE invites comment and recommendations from interested 

parities on any aspect of the Manufacturer Impact Analysis. 
136

Public Meeting Agenda

1 Overview

2 Market & Technology Assessment; Screening Analysis

3 Engineering Analysis

4 Markups Analysis and Energy Use Characterization

5 Life-Cycle Cost and Payback Period Analysis

6 Shipments, National Impact Analysis, RIA

7 Manufacturer Impact Analysis

8 Environmental Impacts; Indirect Employment

9 Closing Remarks and How to Submit Comments
137

Emissions Impact Analysis

Purpose

• Estimate emission impacts resulting from amended standards. 

− Full Fuel Cycle (FFC) emissions include power plant , site combustion, and upstream emissions.

Method

• Marginal power plant emission factors for carbon dioxide (CO2), nitrogen oxides (NOX), 

sulfur dioxide (SO2), and mercury (Hg) estimated using the output from AEO 2013

reference and standard cases.

• Site combustion emissions for CO2, NOX, SO2, methane (CH4), and nitrous oxide (N2O) 

are estimated using emissions intensity factors published by Environmental Protection 

Agency (EPA).1,2

• The FFC upstream emissions are estimated based on the methodology developed by 

Coughlin (2013). 3 The upstream emissions include both emissions from fuel 

combustion during extraction, processing, and transportation of fuel, and “fugitive” 

emissions (direct leakage to the atmosphere) of CH4and CO2. 

Results

• See Ch. 13 of the TSD.

1: EPA. Compilation of Air Pollutant Emission Factors. 1998

2: EPA. Emission Factors for Greenhouse Gas Inventories. 2015

3: Coughlin, K., “Projections of Full-Fuel-Cycle Energy and Emissions Metrics” (2013).
138

Emissions Impact Analysis

Results: Cumulative Emissions Reduction (Total FFC Emissions)

Note: Negative values indicate an increase in emissions.

* CO2eq is the quantity of CO2that would have the same global 

warming potential (GWP).

Emissions AFUE Trial Standard Levels

1 2 3 4 5

CO2(million metric tons) 3.45 9.43 12.9 70.2 100

NOX(thousand tons) 0.130 0.751 0.312 0.555 1.07

SO2(thousand tons) 8.50 23.0 32.1 176 250

Hg (thousand tons) 0.000 0.000 -0.001 -0.005 -0.004

N2O (thousand tons) 0.028 0.100 0.097 0.529 0.602

N2O (thousand tons of CO2eq*) 7.35 26.4 25.7 140 160

CH4(thousand tons) 28.6 66.5 110 585 940

CH4(thousand tons of CO2eq*) 800 1,863 3,084 16,381 26,325

Emissions Standby/Off Mode Trial Standard Levels

1 2 3

CO2(million metric tons) 1.42 1.62 2.05

NOX(thousand tons) 1.51 1.73 2.19

SO2(thousand tons) 1.32 1.51 1.91

Hg (thousand tons) 0.002 0.003 0.004

N2O (thousand tons) 0.041 0.047 0.060

N2O (thousand tons of CO2eq*) 11.0 12.6 15.9

CH4(thousand tons) 8.11 9.29 11.8

CH4(thousand tons of CO2eq*) 227 260 329
139

Request for Comment

Issue 8-1: DOE requests comment on the approach for conducting the 

emissions analysis for residential boilers.

Emissions Impact Analysis
140

Monetization of Emission Reductions

Purpose

• Estimate the monetary benefit of reduced emissions resulting from the proposed 

energy conservation standard.

Methodology

• Used the most current Social Cost of Carbon (SCC) values developed through 

interagency reviews.

– SCC is intended to be a monetary measure of the incremental damage resulting from greenhouse 

gas (GHG) emissions, including but not limited to agricultural productivity loss, human health 

effects, property damage from rising sea levels, and changes in the ecosystem.

• Interagency estimates1 of the potential global benefits resulting from reduced CO2

emissions in 2015 are $12.0, $40.5, $62.4, and $119 per metric ton (2013$).

• DOE also monetized NOX emissions reductions resulting from amended standards.2

− Estimates of monetary value range from $476 to $4,893 per short ton.

− DOE calculated monetary benefits using a medium value of $2,684 per short ton.

• DOE is still evaluating appropriate values to monetize avoided SO2and Hg emissions.

Results

• See Ch. 14 of the TSD.

1: Interagency Working Group, 2010 and 2013

2: OMB report to Congress, 2006
141

Monetization of Emission Reductions

Results: Value of Emissions Reduction (Total FFC Emissions)

Note: Range of the value of CO2reductions is based on estimates of the global benefit of reduced CO2 emissions.

Emissions AFUE Trial Standard Levels

1 2 3 4 5

CO2 (2013$ billion)

0.020 to 

0.30

0.054 to 

0.84

0.074 to 

1.14

0.404 to 

6.22

0.573 to 

8.86

NOX – 3% discount rate (2013$ million) 9.4 25.5 35.5 196 275

NOX – 7% discount rate (2013$ million) 3.58 9.73 13.5 75.6 105

Emissions Standby/Off Mode Trial Standard Levels

1 2 3

CO2 (2013$ billion)

0.008 to 

0.124

0.009 to 

0.142

0.012 to 

0.180

NOX – 3% discount rate (2013$ million) 1.44 1.65 2.08

NOX – 7% discount rate (2013$ million) 0.56 0.64 0.80
142

Request for Comment

Issue 8-2: DOE requests comment on DOE’s approach for estimating 

monetary benefits associated with emissions reductions.

Monetization of Emission Reductions
143

Utility Impact Analysis

Purpose

• Assess impacts on electric installed capacity and generation resulting from the 

adoption of potential energy conservation standards. 

Method

• Modeled energy savings impacts from TSLs using NEMS-BT to generate forecasts 

that deviate from the AEO reference case.

Output

• Changes in total electricity generation.

• Changes in primary fuel (e.g., coal, natural gas) consumption

• Changes to the mix of electricity generation by fuel type.

• Changes to total installed capacity.

Results: See chapter 15 of the TSD.
144

Indirect Employment Impact Analysis

Purpose

• Assess the overall impact on indirect* national employment from the proposed energy 

conservation standard that results from shifting consumer expenditures among goods 

and services and changing product and energy costs. 

Methodology

• Used the Impact of Sector Energy Technologies (ImSET) model to evaluate indirect 

employment impacts. 

• Changes in national product and energy expenditures from the NIA are entered as 

inputs into ImSET.

Results

• Net labor market impacts will be small over time due to the small magnitude of the 

short-term effects. (See chapter 16 of the TSD.)

*Direct national employment impacts are discussed in the Manufacturer Impact Analysis (MIA).
145

Public Meeting Agenda

1 Overview

2 Market & Technology Assessment; Screening Analysis

3 Engineering Analysis

4 Markups Analysis and Energy Use Characterization

5 Life-Cycle Cost and Payback Period Analysis

6 Shipments, National Impact Analysis, RIA

7 Manufacturer Impact Analysis

8 Environmental Impacts; Indirect Employment

9 Closing Remarks and How to Submit Comments
146

Closing Remarks

Meeting participants are invited to provide closing remarks at 

this time.
147

How to Submit Comments

• In all correspondence, please refer to the rulemaking by:

– Energy Conservation Standards for Boilers

– Docket Number: EE-2012–BT–STD–0047

– Regulatory Identification Number (RIN): 1904-AC88

• Email: ResBoilers2012STD0047@ee.doe.gov

Postal Mail:

Ms. Brenda Edwards

U.S. Department of Energy

Building Technologies Office

Mailstop EE-5B

1000 Independence Avenue, S.W.

Washington, DC 20585-0121

Courier:

Ms. Brenda Edwards

U.S. Department of Energy

Building Technologies Office

L’Enfant Plaza, S.W., Suite 600 

Washington, DC 20024

Telephone: (202) 586-2945

• Comment period closes June 1, 2015 at 11:59 PM EDT