This section of the FEDERAL REGISTER

contains notices to the public of the proposed

issuance of rules and regulations. The

purpose of these notices is to give interested

persons an opportunity to participate in the

rule making prior to the adoption of the final

rules.

Proposed Rules Federal Register

12969 

Vol. 78, No. 38 

Tuesday, February 26, 2013 

DEPARTMENT OF ENERGY 

10 CFR Part 430 

[Docket Number EERE–2012–BT–STD– 

0022] 

RIN 1904–AC78 

Energy Conservation Program for 

Consumer Products: Energy 

Conservation Standards for 

Residential Water Heaters 

AGENCY: Office of Energy Efficiency and 

Renewable Energy, DOE. 

ACTION: Notice of proposed rulemaking 

and announcement of public meeting. 

SUMMARY: The Energy Policy and 

Conservation Act of 1975 (EPCA), as 

amended, prescribes energy 

conservation standards for various 

consumer products and certain 

commercial and industrial equipment, 

including residential water heaters. 

EPCA also requires the U.S. Department 

of Energy (DOE) to determine whether 

more stringent amended standards 

would be technologically feasible and 

economically justified, and would save 

a significant amount of energy. 

Accordingly, DOE established amended 

energy conservation standards for 

several classes of residential water 

heaters in an April 2010 final rule. 

Subsequent to the publication of that 

final rule, a number of utility companies 

brought forth concerns regarding the 

amended energy conservation standard 

levels for electric storage water heaters 

and the impact of these standards on 

electric thermal storage programs that 

utility companies administer to manage 

peak load. In this document, DOE 

proposes to establish a waiver process 

that will mitigate the concerns of utility 

companies regarding the 

implementation of the April 2010 

standard levels by allowing for the 

manufacture of certain large-volume 

electric storage water heaters provided 

that they meet a set of conditions 

discussed in this proposed rule. The 

document also announces a public 

meeting to receive comment on the 

proposed waiver process and criteria for 

obtaining a waiver. 

DATES:

Meeting: DOE will hold a public 

meeting on Friday, March 15, 2013, 

from 9:00 a.m. to 1:00 p.m., in 

Washington, DC. The meeting will also 

be broadcast as a Webinar. For 

information about the public meeting 

and Webinar, see section 0, ‘‘Public 

Participation.’’ 

Comments: DOE will accept 

comments, data, and information 

regarding this notice of proposed 

rulemaking (NPRM) before and after the 

public meeting, but no later than April 

29, 2013. See section 0, ‘‘Public 

Participation,’’ for details. 

ADDRESSES: The public meeting will be 

held at the U.S. Department of Energy, 

Forrestal Building, Room 8E–089, 1000 

Independence Avenue SW., 

Washington, DC 20585. To attend, 

please notify Ms. Brenda Edwards at 

(202) 586–2945. For more information, 

refer to section 0, ‘‘Public 

Participation.’’ 

Interested persons are encouraged to 

submit comments using the Federal 

eRulemaking Portal at 

www.regulations.gov. Follow the 

instructions for submitting comments. 

Alternatively, interested persons may 

submit comments, identified by docket 

number EERE–2012–BT–STD–0022 

and/or RIN 1904–AC78, by any of the 

following methods: 

1. Federal eRulemaking Portal: 

www.regulations.gov. Follow the 

instructions for submitting comments. 

2. Email: ResWaterHtrsRFI–2012– 

STD–0022@ee.doe.gov. Include the 

docket number and/or RIN in the 

subject line of the message. Submit 

electronic comments in WordPerfect, 

Microsoft Word, PDF, or ASCII file 

format, and avoid the use of special 

characters or any form of encryption. 

3. Mail: Ms. Brenda Edwards, U.S. 

Department of Energy, Building 

Technologies Program, Mailstop EE–2J, 

1000 Independence Avenue SW., 

Washington, DC, 20585–0121. If 

possible, please submit all items on a 

compact disc (CD), in which case it is 

not necessary to include printed copies. 

4. Hand Delivery/Courier: Ms. Brenda 

Edwards, U.S. Department of Energy, 

Building Technologies Program, 950 

L’Enfant Plaza SW., Suite 600, 

Washington, DC 20024. Telephone: 

(202) 586–2945. If possible, please 

submit all items on a CD, in which case 

it is not necessary to include printed 

copies. 

Written comments regarding the 

burden-hour estimates or other aspects 

of the collection-of-information 

requirements contained in this proposed 

rule may be submitted to Office of 

Energy Efficiency and Renewable 

Energy through the methods listed 

above and by email to 

Chad_S_Whiteman@omb.eop.gov. 

Instructions: All submissions received 

must include the agency name and 

docket number and/or RIN for this 

rulemaking. No telefacsimilies (faxes) 

will be accepted. For detailed 

instructions on submitting comments 

and additional information on the 

rulemaking process, see section 0 of this 

document (Public Participation). 

Docket: The docket is available for 

review at http://www.regulations.gov, 

including Federal Register notices, 

public meeting attendee lists and 

transcripts, comments, and other 

supporting documents/materials. All 

documents in the docket are listed in 

the http://www.regulations.gov index. 

However, not all documents listed in 

the index may be publicly available, 

such as information that is exempt from 

public disclosure. A link to the docket 

Web page can be found at: http:// 

www.regulations.gov/ 

#!docketDetail;D=EERE-2012-BT-STD0022. See section 0, ‘‘Public 

Participation,’’ for further information 

on how to submit comments through 

www.regulations.gov. 

FOR FURTHER INFORMATION CONTACT: Ms. 

Ashley Armstrong, U.S. Department of 

Energy, Office of Energy Efficiency and 

Renewable Energy, Building 

Technologies, EE–2J, 1000 

Independence Avenue SW., 

Washington, DC 20585–0121. 

Telephone: (202) 586–6590. Email: 

Ashley.Armstrong@ee.doe.gov. 

Mr. Ari Altman, U.S. Department of 

Energy, Office of the General Counsel, 

GC–71, 1000 Independence Avenue 

SW., Washington, DC 20585–0121. 

Telephone: (202) 287–6307. Email: 

Ari.Altman@hq.doe.gov. 

SUPPLEMENTARY INFORMATION: 

Table of Contents 

I. Summary of the Proposed Rule 

II. Introduction 

A. Authority 

B. Background 


wreier-aviles on DSK5TPTVN1PROD with PROPOSALS
12970 Federal Register / Vol. 78, No. 38 / Tuesday, February 26, 2013 / Proposed Rules 

1For editorial reasons, upon codification in the 

U.S. Code, Part B was redesignated as Part A. 

2All references to EPCA in this document refer 

to the statute as amended through the Energy 

Independence and Security Act of 2007, Public Law 

110–140 (Dec. 19, 2007). 

1. Current Standards 

2. Utility Concerns with the April 2010 

Final Rule for Electric Storage Water 

Heaters 

3. June 2012 Request for Information 

III. Discussion 

A. Comments Received in Response to June 

2012 RFI 

1. Whether DOE Should Take Action 

2. Alternatives to Large-Volume Electric 

Resistance Water Heaters to Serve the 

Needs of ETS Programs 

3. Potential for a Separate Product Class for 

‘‘Grid-Interactive’’ Electric Storage Water 

Heaters 

4. Potential for Establishing a Waiver 

Process 

B. Waiver Process 

1. Criteria for Obtaining a Waiver 

2. Requirements and Method for Obtaining 

Waiver 

3. Periodic Review of Waiver Mechanism 

IV. Procedural Requirements 

A. Review Under Executive Orders 12866 

and 13563 

B. Review Under the Regulatory Flexibility 

Act 

C. Review Under the Paperwork Reduction 

Act 

D. Review Under the National 

Environmental Policy Act of 1969 

E. Review Under Executive Order 13132 

F. Review Under Executive Order 12988 

G. Review Under the Unfunded Mandates 

Reform Act of 1995 

H. Review Under the Treasury and General 

Government Appropriations Act, 1999 

I. Review Under Executive Order 12630 

J. Review Under the Treasury and General 

Government Appropriations Act, 2001 

K. Review Under Executive Order 13211 

L. Review Under the Information Quality 

Bulletin for Peer Review 

V. Public Participation 

A. Attendance at the Public Meeting 

B. Procedure for Submitting Requests to 

Speak and Prepared General Statements 

for Distribution 

C. Conduct of the Public Meeting 

D. Submission of Comments 

E. Issues on Which DOE Seeks Comment 

VI. Approval of the Office of the Secretary 

Summary of the Proposed Rule 

DOE believes that electric thermal 

storage (ETS) programs involving water 

heaters provide numerous benefits to 

consumers, utilities, and the Nation, 

and that an alternative approach to 

energy conservation standards for 

certain, limited electric water heaters 

appears to be warranted in order to 

ensure the viability of these programs. 

After considering several options, DOE 

determined that a waiver process is the 

most appropriate, and thus, is proposing 

to adopt such a process in this notice of 

proposed rulemaking (NPRM). The 

proposed process would allow any 

manufacturer of electric water heaters, 

any electric utility company, or a 

combination of the two, to request a 

waiver granting exemption from the 

energy conservation standards 

established in an April 16, 2010 final 

rule (75 FR 20112; referred to 

hereinafter as the ‘‘April 2010 final 

rule’’) for certain electric water heaters 

with rated storage volumes greater than 

55 gallons. Each waiver granted by the 

U.S. Department of Energy (DOE), 

would allow, for a one-year period, 

manufacturers to produce limited 

numbers of electric water heaters with 

rated storage volumes above 55 gallons 

exclusively for the purpose of 

installation in residences enrolled in a 

specific utility company ETS program. 

Parties would be allowed to apply for 

additional one-year waivers in 

subsequent years. This proposed rule, if 

adopted, or the granting of a waiver 

under this rule, would not amend the 

energy conservation standard otherwise 

applicable to electric water heaters with 

rated storage volumes above 55 gallons. 

The following sections include: (1) A 

description of DOE’s statutory authority 

for setting energy conservation 

standards for residential water heaters; 

(2) a discussion of the standards 

promulgated in the April 2010 final rule 

and concerns of utility companies 

regarding those standards; (3) a 

summary of the comments received in 

response to DOE’s June 13, 2012 request 

for information (RFI) on this topic (77 

FR 35299; hereinafter referred to as the 

‘‘June 2012 RFI’’) and DOE’s responses 

to those comments, including a 

discussion of the appropriate 

mechanism to address the concerns of 

utility companies; and (4) a description 

of the waiver process that DOE proposes 

to establish. 

Introduction 

The following section briefly 

discusses the statutory authority 

underlying DOE’s standards for 

residential water heaters and this 

NPRM, as well as some of the relevant 

historical background regarding the 

establishment of standards for 

residential water heaters. 

A. Authority 

Title III, Part B1 of the Energy Policy 

and Conservation Act of 1975 (‘‘EPCA’’ 

or ‘‘the Act’’), Public Law 94–163 (42 

U.S.C. 6291–6309, as codified) sets forth 

a variety of provisions designed to 

improve energy efficiency and 

establishes the Energy Conservation 

Program for Consumer Products Other 

Than Automobiles,2 a program covering 

most major household appliances 

(collectively referred to as ‘‘covered 

products’’), which includes the types of 

residential water heaters that are the 

subject of this NPRM. (42 U.S.C. 

6292(a)(4)) 

Under EPCA, this program generally 

consists of four parts: (1) Testing; (2) 

labeling; (3) establishing Federal energy 

conservation standards; and (4) 

certification and enforcement 

procedures. The Federal Trade 

Commission (FTC) is primarily 

responsible for labeling consumer 

products, and DOE implements the 

remainder of the program. Subject to 

certain criteria and conditions, DOE is 

required to develop test procedures to 

measure the energy efficiency, energy 

use, or estimated annual operating cost 

of each covered product. (42 U.S.C. 

6293) Manufacturers of covered 

products must use the prescribed DOE 

test procedure as the basis for certifying 

to DOE that their products comply with 

the applicable energy conservation 

standards adopted under EPCA and 

when making representations to the 

public regarding the energy use or 

efficiency of those products. (42 U.S.C. 

6293(c) and 6295(s)) Similarly, DOE 

must use these test procedures to 

determine whether the products comply 

with standards adopted pursuant to 

EPCA. Id. The DOE test procedures for 

residential water heaters currently 

appear at Title 10 of the Code of Federal 

Regulations (CFR) part 430, Subpart B, 

Appendix E. 

EPCA, as codified, contains what is 

known as an ‘‘anti-backsliding’’ 

provision, which prevents the Secretary 

from prescribing any amended standard 

that either increases the maximum 

allowable energy use or decreases the 

minimum required energy efficiency of 

a covered product. (42 U.S.C. 

6295(o)(1)) Also, the Secretary may not 

prescribe an amended or new standard 

if interested persons have established by 

a preponderance of the evidence that 

the standard is likely to result in the 

unavailability in the United States of 

any covered product type (or class) of 

performance characteristics (including 

reliability), features, sizes, capacities, 

and volumes that are substantially the 

same as those generally available in the 

United States. (42 U.S.C. 6295(o)(4)). 

B. Background 

1. Current Standards 

Before being amended by the National 

Appliance Energy Conservation Act of 

1987 (NAECA; Pub. L. 100–12), Title III 

of EPCA included residential water 

heaters as covered products. NAECA’s 

amendments to EPCA established 

energy conservation standards for 


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3Energy factor is a measure of overall water 

heater efficiency that accounts for efficiency during 

active, standby, and cyclical operation. 

residential water heaters. (42 U.S.C. 

6295(e)(1); 42 U.S.C. 6295(e)(4)) DOE 

initially amended the statutorilyprescribed standards for water heaters 

in 2001 (66 FR 4474 (Jan. 17, 2001)) and 

amended standards for water heaters for 

a second time in the April 2010 Final 

Rule. 

The energy conservation standards for 

residential water heaters in the April 

2010 Final Rule will apply to products 

manufactured on or after April 16, 2015. 

75 FR 20112. The amended energy 

conservation standards consist of 

minimum energy factors 3 (EF) that vary 

based on the rated storage volume of the 

water heater, the type of energy it uses 

(i.e., gas, oil, or electricity), and whether 

it is a storage, instantaneous, or tabletop 

model. 10 CFR 430.32(d). The currently 

applicable water heater energy 

conservation standards, as well as those 

that will be applicable starting April 16, 

2015, are set forth in Table II.1 below. 

Of particular relevance for this NPRM, 

on April 16, 2015, electric water heaters 

with a rated storage volume above 55 

gallons will be required to have an 

energy factor of at least 2.057 ¥ 

(0.00113 × Rated Storage Volume in 

gallons). Such a level is currently 

achievable only by using heat pump 

water heater technology and cannot be 

achieved in electric water heaters that 

rely solely on electric resistance 

elements. 

TABLE II.1—ENERGY CONSERVATION STANDARDS FOR RESIDENTIAL WATER HEATERS

Product class Energy factor as of January 20, 2004 Energy factor as of April 16, 2015 

Gas-fired Water Heater ........ 0.67 ¥ (0.0019 × Rated Storage Volume in gallons) .... For tanks with a Rated Storage Volume at or below 55 

gallons: EF = 0.675 ¥ (0.0015 × Rated Storage Volume in gallons). 

For tanks with a Rated Storage Volume above 55 gallons: 

EF = 0.8012 ¥ (0.00078 × Rated Storage Volume in 

gallons). 

Oil-fired Water Heater .......... 0.59 ¥ (0.0019 × Rated Storage Volume in gallons) .... EF = 0.68 ¥ (0.0019 × Rated Storage Volume in gallons). 

Electric Water Heater ........... 0.97 ¥ (0.00132 × Rated Storage Volume in gallons) .. For tanks with a Rated Storage Volume at or below 55 

gallons: EF = 0.960 ¥ (0.0003 × Rated Storage Volume in gallons). 

For tanks with a Rated Storage Volume above 55 gallons: 

EF = 2.057 ¥ (0.00113 × Rated Storage Volume in 

gallons). 

Tabletop Water Heater ........ 0.93 ¥ (0.00132 × Rated Storage Volume in gallons) .. EF = 0.93 ¥ (0.00132 × Rated Storage Volume in gallons). 

Instantaneous Gas-fired 

Water Heater.

0.62 ¥ (0.0019 × Rated Storage Volume in gallons) .... EF = 0.82 ¥ (0.0019 × Rated Storage Volume in gallons). 

Instantaneous Electric Water 

Heater.

0.93 ¥ (0.00132 × Rated Storage Volume in gallons) .. EF = 0.93 ¥ (0.00132 × Rated Storage Volume in gallons). 

2. Utility Concerns With the April 2010 

Final Rule for Electric Storage Water 

Heaters 

Subsequent to the publication of the 

April 2010 Final Rule, several 

stakeholders (i.e., National Rural 

Electric Cooperative Association 

(NRECA), PJM Interconnection (PJM), 

American Public Power Association 

(APPA), and Steffes Corporation) 

indicated to DOE their concerns about 

the interaction of the amended 

standards in the April 2010 final rule 

and the use of electric storage water 

heaters with tanks having greater than 

55 gallons of rated storage volume 

(referred to hereinafter as ‘‘largevolume’’ electric storage water heaters) 

used in ETS programs. Utilities use ETS 

programs, sometimes also known as 

load shifting or demand response 

programs, to manage peak demand load 

by limiting the times when certain 

appliances are operated. ETS programs 

typically allow the utility to control the 

appliance remotely to allow operation of 

the appliance only during off-peak 

hours. During off-peak operation, the 

electricity consumed is stored by the 

appliance as thermal energy for use 

during peak hours when it is not 

allowed to operate. Large-volume 

electric storage water heaters are a key 

component of utility ETS programs that 

target electric water heaters because 

these larger-volume products allow for 

the storage of enough hot water to meet 

consumer usage during peak demand 

times when the water heater would not 

be allowed to turn on. 

As shown in Table II.1 and noted 

above, the April 2010 Final Rule 

established an energy conservation 

standard that would effectively require 

the use of heat pump technology to meet 

the minimum energy conservation 

standard for large-volume electric 

storage water heaters. Utility companies 

presented concerns about the feasibility 

of continuing ETS programs without the 

use of large-volume electric resistance 

water heaters (ERWHs). Utilities believe 

the practicability of heat pump water 

heaters (HPWHs) are such that HPWHs 

may not be able to fill the same role as 

large-volume ERWHs in ETS programs. 

(The capability of HPWHs or multiple 

small-volume (i.e., storage volume of 55 

gallons or less) water heaters to serve 

the needs of ETS programs is discussed 

further in section 0.) In light of the 

perceived lack of viable alternatives to 

large volume ERWHs for ETS programs, 

utility companies are concerned that 

participation in ETS programs may be 

reduced or eliminated after the 

standards take effect in 2015, which 

would eliminate the numerous benefits 

to consumers, utilities, and the Nation 

resulting from ETS programs. (See 

section 0 for discussion of the benefits 

from ETS programs.) Because of their 

concerns, utilities requested that DOE 

consider allowing for the manufacture 

of large-volume ERWHs solely for ETS 

applications. 


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4 In total there were 155 filings, but 26 comments 

were either exact duplicates or data supplements, 

so they are not included in the final count. 

Additionally two commenters submitted multiple 

filings with generally the same ideas expressed in 

each filing, and were only counted once in the final 

count. 

5One joint comment was received from four 

utilities/associations—PJM, NRECA, APPA, Edison 

Electric Institute (EEI)—as well as Steffes 

Corporation (Steffes), which manufactures thermal 

storage water heater controls. This is referred to as 

the ‘‘Joint Utilities comment’’ in this document. A 

supplemental comment to this joint comment was 

received from the four utilities only (i.e., PJM, 

NRECA, APPA, and EEI), which is referred to as the 

‘‘Joint Utilities Supplemental Comment.’’ One joint 

comment was from three efficiency advocates, the 

American Council for an Energy Efficient Economy 

(ACEEE), Natural Resources Defense Council 

(NRDC), and Appliance Standards Awareness 

Project (ASAP). This comment is referred to as the 

‘‘Joint Efficiency Advocates comment’’ in this 

document. One joint comment was from three 

stakeholders—Northwest Energy Efficiency 

Alliance (NEEA) and the Northwest Power and 

Conservation Council (NPCC), and the Bonneville 

Power Administration (BPA) utility. This comment 

is referred to as the ‘‘Northwest Advocates 

comment’’ in this document. 

6 In instances where both a group of cooperatives 

and its individual cooperative members gave 

figures, only the figures from the group of 

cooperatives were counted to avoid double 

counting. This includes figures provided by: Corn 

Belt, Dairyland, East River, ECSC, Dakota Electric 

Association, East Central, Federated, Goodhue, 

Kandiyohi, McLeod, Minnesota Valley, Nobles, 

Stearns Wright-Hennepin, Northwest Iowa Power, 

Buckeye Power, Rappahannock, PowerSouth, 

Lower Valley, Wabash, Cass County, Powell Valley, 

Tri-State, NOVEC, Black Hills, Verendrye, Lake 

Country, Mountain Electric, Leavenworth-Jefferson, 

Thumb Electric, SCIREC, Jackson County, Duck 

River, Shenandoah Valley, Adams, Tri-County 

Rural, Habersham Electric, Flint, Dakota Valley, 

Northern Plains, Aurelia, United Electric. 

7 In instances where both a group of cooperatives 

and its individual cooperative members gave 

figures, only the figures from the group of 

cooperatives were counted to avoid double 

counting. This total includes figures provided by: 

Farmers Electric, Midland, Dairyland, East River, 

ECSC, Great River, NIPCO, PowerSouth, Lower 

Valley, Bristol, Central Georgia EMC, Jackson 

County, Duck River, Shenandoah Valley, Adams, 

Shelby Electric, Flint, Aurelia. 

8 In instances where both the distribution 

cooperative and its individual cooperative members 

gave figures, only the distribution cooperatives 

figures were counted to avoid double counting. This 

number includes figures from: Farmers Electric 

Cooperative, Corn Belt, Dairyland, East River, 

ECSC, Connexus, Dakota Electric Association, East 

Central, Federated, Goodhue, Itasca-Mantrap, 

Kandiyohi, McLeod, Minnesota Valley, Nobles, 

Stearns, Wright-Hennepin, NIPCO, Buckeye, 

Rappahannock, PowerSouth, Lower Valley, 

Wabash, Cass County, Bristol Tennessee Essential 

Services, Powell Valley Electric Cooperative, 

Central Georgia EMC, Otter Tail, Black Hills, 

Verendrye, Mountain Electric, LeavenworthJefferson, Thumb, SCIREC, Jackson County, Duck 

River, Shenandoah Valley, Adams, Shelby Electric, 

Habersham, Flint, Dakota Valley, Northern Plains, 

Aurelia, United Electric. 

3. June 2012 Request for Information 

To seek feedback from interested 

parties related to the issues raised by 

utility companies, DOE published the 

June 2012 RFI. 77 FR 35299, June 13, 

2012. The RFI described utility ETS 

programs for water heaters and the 

utility’s concerns over the amended 

standard levels for electric storage water 

heaters with storage volumes above 55 

gallons, and sought comment on these 

topics as well as a number of related 

issues. Specifically, DOE requested 

comment on (1) the penetration of ETS 

programs and the impacts of such 

programs on consumers and the Nation; 

(2) the impacts of the April 2010 

standard levels on utility ETS programs; 

(3) information on any feature or 

features for residential water heaters 

used in ETS programs that are unique to 

those water heaters and whether such 

feature(s) would justify a separate 

standard from other residential water 

heaters; and (4) information on potential 

solutions that would resolve the 

concerns of utilities that administer ETS 

programs for residential water heaters 

and require the use of large-volume 

electric storage water heaters, including 

several potential approaches identified 

in the RFI. 77 FR 35304. 

DOE received 127 4 comments from 

interested parties, including 109 from 

individual utility companies or utility 

associations (including the electric 

power research institute (EPRI)), 6 from 

manufacturers, 1 from an individual 

efficiency advocate, 1 comment from a 

trade association, 4 comments from U.S. 

Congressmen, and 3 joint comments—2 

joint comments from multiple utilities, 

one of which also included a 

manufacturer of ETS controls (referred 

to as the ‘‘Joint Utilities comment’’) and 

one of which did not (referred to as the 

‘‘Joint Utilities Supplemental 

comment’’), 1 joint comment from 

several efficiency advocates (referred to 

as the ‘‘Joint Efficiency Advocates 

comment’’), and 1 joint comment from 

efficiency advocates and a utility 

company located in the northwestern 

U.S. (referred to as the ‘‘Northwest 

Advocates comment’’).5 The utilities 

who responded to the June 2012 RFI 

serve approximately 5.3 million 6

customers, of which approximately 1.7 

million 7 currently utilize electric 

resistance water heaters, and 

approximately 630,000 8 currently 

participate in ETS programs. The 

responses generally centered on 

recommendations for DOE’s path 

forward and whether heat pump water 

heaters are a viable alternative to 

electric resistance water heaters for ETS 

programs. The comments helped DOE to 

formulate the proposals in this NPRM 

and are discussed in section A. 

Discussion 

A. Comments Received in Response to 

June 2012 RFI 

As noted, DOE received 127 unique 

comments in response to the June 2012 

RFI. The comments focused on four 

main issues: (1) whether DOE should 

take action to address the utility 

company concerns and the benefits of 

ETS programs; (2) the technological 

capability of alternatives to largevolume ERWHs to be utilized in ETS 

programs; (3) the potential for 

implementing a waiver program to 

allow the manufacture of certain water 

heaters specifically for use in ETS 

programs; and 4) the potential for 

implementing a separate product class 

for water heaters used in ETS programs 

(i.e., ‘‘grid-interactive’’ water heaters). 

The comments and DOE responses 

related to these four topics are 

summarized in sections 0 through 0 

immediately below. 

1. Whether DOE Should Take Action 

Of the 127 comments received by 

DOE, 120 recommended that DOE 

should take some action to mitigate the 

issue that the April 2010 standard 

would potentially cause for utility ETS 

programs. (See section 2 for a brief 

description of the utility concerns.) 

(Buckeye Power, Inc. (Buckeye), No. 3 at 

p. 1; Codington-Clark Electric 

Cooperative (Codington-Clark), No. 4 at 

pp. 1–3; Rappahannock Electric 

Cooperative (Rappahannock), No. 5 at 

pp. 1–3; Northern Plains Electric 

Cooperative (Northern Plains), No. 6 at 

p. 1; Itasca-Mantrap Cooperative 

Electrical Association (Itasca-Mantrap), 

No. 7 at pp. 1–2; Northwest Iowa Power 

Cooperative (Northwest Iowa Power), 

No. 8 at p. 1; PowerSouth Energy 

Cooperative (Powersouth), No. 10 at pp. 

1–3; Barron Electric Cooperative 

(Barron), No. 11 at p. 2; Clark Electric 

Cooperative (Clark), No. 13 at p. 1; 

Woodbury County Rural Electric 

Cooperative (Woodbury), No. 14 at p. 1; 

North West Rural Electric Cooperative 

(North West), No. 15 at p. 1; Bayfield 

Electric Cooperative (Bayfield), No. 16 

at p. 2; Union County Electric 

Cooperative (Union County), Inc., No. 

17 at p. 1; Allamakee-Clayton Electric 

Cooperative (Allamakee-Clayton), No. 

18 at p. 1; Lower Valley Energy, No. 19 

at p. 1; AO Smith, No. 20 at p. 1; 

Wabash Valley Power (Wabash), No. 21 

at p. 1; Heartland Power Cooperative 

(Heartland), No. 22 at p. 1; South 

Central Electric Association (South 

Central), No. 23 at p. 1; Cass County 

Electric Cooperative (Cass County), No. 

24 at p. 1; East River Electric Power 

Cooperative (East River), No. 25 at p. 1; 


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Richland Electric Cooperative 

(Richland), No. 26 at p. 1; Lyon-Lincoln 

Electric Cooperative, No. 27 at pp. 1–3; 

Central Electric Power Cooperative 

(Central), No. 28 at p. 1; Tri-County 

Electric Cooperative (Tri-County), No. 

29 at pp. 1–4; Price Electric Cooperative 

(Price), No. 30 at p. 1; Bristol Tennessee 

Essential Services (Bristol), No. 31 at pp. 

1–2; FEM Electric (FEM), No. 32 at p. 1; 

The Berkeley Electric Cooperative 

(BEC), Inc., No. 33 at p. 1; Powell Valley 

Electric Cooperative (Powell Valley), 

No. 34 at p. 1; Humboldt County Rural 

Electric Cooperative (Humboldt), No. 35 

at p. 1; Dakota Electric, No. 36 at p. 4; 

Nishnabotna Valley Rural Electric 

Cooperative (Nishnabotna Valley REC), 

No. 37 at p. 1; Corn Belt Power 

Cooperative (Corn Belt), No. 39 at p. 1; 

Clay-Union Electric Corporation (ClayUnion), No. 40 at p. 1; Great River 

Energy (Great River), No. 41 at p. 1; 

Central Georgia Electric Membership 

Corporation (Central Georgia EMC), No. 

42 at p. 1; Otter Tail Power Company 

(Otter Tail), No. 44 at p. 1; Electric 

Cooperatives of South Carolina (ECSC), 

No. 45 at p. 1; Aiken Electric 

Cooperative (Aiken), Inc., No. 46 at p. 1; 

Connexus Energy (Connexus), No. 47 at 

p. 1; Dairyland Power Cooperative 

(Dairyland), No. 48 at p. 1; Pee Dee 

Electric Cooperative (Pee Dee), No. 49 at 

p. 1; Oconto Electric Cooperative 

(Oconto), No. 50 at p. 1; WrightHennepin Cooperative Electric 

Association (Wright-Hennepin), No. 51 

at p. 1; Midland Power Cooperative 

(Midland), No. 52 at p. 1; Lynches River 

Electric Cooperative, Inc. (Lynches), No. 

53 at p. 1; Pierce Pepin Cooperative 

Services (Pierce Pepin), No. 54 at p. 1; 

Dunn Energy Cooperative (Dunn), No. 

55 at p. 1; Palmetto Electric Cooperative, 

Inc. (Palmetto), No. 56 at p. 1; Horry 

Electric Cooperative (Horry), No. 57 at 

p. 1; Joint Utilities, No. 58 at p. 4; 

Fairfield Electric Cooperative (Fairfield), 

No. 59 at p. 1; National Electrical 

Manufacturers Association (NEMA), No. 

60 at p. 4; Tri-State Generation and 

Transmission Association (Tri-State), 

No. 61 at p. 1; Santee Electric 

Cooperative (Santee), No. 62 at p. 1; 

Cuyahoga Falls Electric Department 

(Cuyahoga Falls), No.63 at p. 1; 

Newberry Electric Cooperative, Inc. 

(Newberry), No. 64 at p. 1; Giant 

Factories, Inc. (Giant Factories), No. 65 

at p. 2; People’s Energy Cooperative 

(People’s Energy), No. 66 at p. 1; 

Michigan Electric Cooperative 

Association (MECA), No. 67 at p. 1; 

Joint Efficiency Advocates, No. 68 at p. 

1; Eau Claire Energy Cooperative (Eau 

Clair), No. 69 at p. 1; Edisto Electric 

Cooperative (Edisto), No. 70 at p. 1; 

Coastal Electric Cooperative (Coastal), 

No. 71 at p. 1; Vaughn Thermal 

Corporation (Vaughn), No. 72 at p. 1; 

York Electric Cooperative (York), No. 73 

at p. 1; Black River Electric Cooperative, 

Inc. (Black River), No. 76 at p. 1; MidCarolina Electric Cooperative, Inc. 

(MCEC), No. 77 at p. 1; Prairie Energy 

Cooperative (Prairie), No. 78 at p. 1; 

Alexandria Light and Power (ALP), No. 

79 at p. 1; Alliance to Save Energy, No. 

80 at p. 1; Blue Ridge Electric 

Cooperative (Blue Ridge), No. 82 at p. 1; 

Freeborn-Mower Cooperative Services 

(Freeborn-Mower), No. 83 at p. 2; 

American Public Power Association 

(APPA), No. 84 at p. 3; Rheem 

Manufacturing Company (Rheem), No. 

86 at p. 2; Heat Transfer Products, Inc. 

(HTP), No. 87 at p. 1; Nebraska Public 

Power District (Nebraska Public Power), 

No. 88 at p. 1; Clark Public Utilities, No. 

90 at p. 1; Northern Virginia Electric 

Cooperative (NOVEC), No. 91 at p. 1; 

Congressman Todd Rokita, No. 93 at p. 

1; Black Hills Electric Cooperative 

(Black Hills), No. 96 at p. 1; Verendrye 

Electric Cooperative (Verendrye), No. 97 

at p. 1; Dakota Energy Cooperative 

(Dakota Energy), No. 98 at p. 1; 

Minnesota Rural Electric Association 

(Minnesota Rural), No. 99 at p. 1; 

Minnesota Valley Electric Cooperative 

(Minnesota Valley), No.101 at p. 1; 

McLeod Cooperative Power (McLeod), 

No.102 at p. 1; Lake Country Power 

(Lake Country), No.108 at p. 1; 

Mountain Electric Cooperative 

(Mountain Electric), No.109 at p. 1; 

Leavenworth-Jefferson Electric 

Cooperative (Leavenworth-Jefferson), 

No. 110 at p. 1; Riverland Energy 

Cooperative (Riverland), No. 111 at p. 1; 

Meeker Cooperative Light & Power 

(Meeker), No.112 at p. 1; Federated 

Rural Electric (Federated), No.113 at p. 

1; Iowa Lakes Electric Cooperative (Iowa 

Lakes), No. 114 at p. 1; Thumb Electric 

Cooperative (Thumb), No. 115 at p. 1; 

South Central Indiana Rural Electric 

Cooperative (South Central Indiana 

REC), No. 117 at p. 1; Tri-County 

Electric Cooperative (Tri-County 

Electric), No. 118 at p. 1; Nobles 

Cooperative Electric (Nobles), No. 119 at 

p. 1; Lake Region Electric Cooperative 

(Lake Region), No. 120 at p. 1; 

Congressman Dan Burton, No. 122 at p. 

1; Sioux Valley Energy (Sioux Valley), 

No. 123 at p. 1; East Central Energy (East 

Central), No. 124 at p. 1; Jackson County 

Rural Electric Membership Corporation 

(Jackson County), No. 126 at p. 1; Duck 

River Electric Membership Corporation 

(Duck River), No. 127 at p. 1; 

Shenandoah Valley Electric Cooperative 

(Shenandoah Valley), No. 128 at p. 1; 

Adams Electric Cooperative (Adams), 

No.129 at p. 1; Goodhue County 

Cooperative (Goodhue), No.130 at p. 1; 

Adams-Columbia Electric Cooperative 

(Adams-Columbia), No.132 at p. 1; 

Stearns Electric Association (Stearns), 

No.134 at p. 1; Senator John Thune, No. 

137 at p. 1; Kandiyohi Power 

Cooperative (Kandiyohi), No.138 at p. 1; 

Shelby Electric Cooperative (Shelby), 

No. 143 at p. 1; Tri-County Rural 

Electric Cooperative, Inc. (Tri-County 

REC), No. 144 at p. 1; Beltrami Electric 

Cooperative, No. 145 at p. 1 (Beltrami); 

Habersham Electric Membership 

Cooperative (Habersham), No.146 at p. 

1; Flint Energy Membership Corporation 

(Flint), No. 147 at p. 1; Dakota Valley 

and Northern Plains, No.149 at p. 1; 

Aurelia Municipal Electric (Aurelia), 

No. 151 at p. 1; United Electric 

Cooperative (United Electric), No. 153 at 

p. 1) 

The Northwest Advocates stated that 

action should be taken, but only if 

analysis concludes that the net benefits 

of resistance-only water heaters 

including load shifting and ancillary 

service benefits are greater than those of 

HPWHs. (Northwest Advocates, No. 89 

at p. 2) 

Only two commenters—one 

manufacturer, General Electric (GE), and 

one utility company, Farmers Electric 

Cooperative—recommended that DOE 

take no action to address the utility 

company concerns regarding the April 

2010 final rule energy conservation 

standard for large-volume electric water 

heaters. (GE, No. 85 at pp. 1–4; Farmers 

Electric Cooperative, No. 2 at p. 1) 

Farmers Electric Cooperative cited the 

considerable energy conservation 

benefits and cost savings to consumers 

from heat pump water heaters as a 

reason for supporting the April 2010 

standard. Farmers Electric Cooperative 

emphasized that HPWHs reduce 

electricity demand up to three times. GE 

argued that viable alternatives are 

available (including heat pump water 

heaters) to meet the needs of ETS 

programs (see additional discussion of 

alternatives in section 0 below). GE also 

stated that there is no basis for creating 

a new product class for grid interactive 

water heaters and that doing so would 

impede the development of the market 

for HPWHs (see additional discussion of 

the potential for a new product class in 

section 3). GE contended that such an 

approach would also create a loophole 

that would erase some of the consumer 

and national benefits achieved by the 

April 2010 standards, which would be 

contrary to DOE’s goals. (GE, No. 85 at 

p. 2) 

EPRI took no position on whether 

DOE should take action, but rather 

noted that large-volume grid interactive 


wreier-aviles on DSK5TPTVN1PROD with PROPOSALS
12974 Federal Register / Vol. 78, No. 38 / Tuesday, February 26, 2013 / Proposed Rules 

9 In instances where both a group of cooperatives 

and its individual members gave figures, only the 

figures from the group of cooperatives were counted 

to avoid double counting. This total includes 

figures provided by: Humboldt, Heartland, 

Dairyland, FEM, South Central, Federated, ItascaMantrap, Northern Plains, PowerSouth, Bristol, 

Otter Tail, Shelby, Habersham, and Flint. 

10 In instances where both a group of cooperatives 

and its individual members gave figures, only the 

figures from the group of cooperatives were counted 

to avoid double counting. This total includes 

figures provided by: Humbolt, Dairyland, East 

River, ECSC, Dakota Electric, ECE, Federated, 

Goodhue, Mcleod, NIPCO, Buckeye, PowerSouth, 

Wabash, NOVEC, Lower Valley, Cass County, 

Bristol, Power Valley, Central Georgia EMC, Pierce 

Pepin, Eau Claire, Black Hills, Verendrye, Thumb 

Electric, SCIREMC, Tri-County, Shenandoah Valley, 

Adams, Tri-County, Flint, Dakota Valley and 

Northern Plains, United Electric, Iowa Lakes, ItascaMantrap, Kandiyohi, and Minnesota Valley Electric. 

ERWH appear to provide value to both 

utilities and consumers and stated its 

intent to conduct further research to 

quantify the value of overall system 

efficiencies of grid-interactive water 

heaters. (EPRI, No. 74 at p. 4) EPRI 

expressed concerns that without the 

continued availability of large volume 

electric water heaters beyond April 

2015, the industry may permanently 

forego a potential resource to provide 

grid support, especially in light of the 

integration of renewable electricity 

sources. (EPRI, No. 74 at p. 5) 

The majority of the comments 

received in support of DOE action 

described the benefits of ETS programs 

for consumers, utilities, and the Nation 

as the main reason that DOE should take 

action to preserve utility ETS programs. 

Generally these commenters believe that 

DOE should take some action (generally 

either establishing a new product class 

or establishing a waiver program) to 

preserve the ability of manufacturers to 

produce and utility companies to use 

large-volume electric resistance storage 

water heaters. These stakeholders 

supported action due to the 

considerable benefits that they believe 

ETS programs provide to consumers, 

utilities and the electric grid, and due to 

the perceived lack of alternative 

products capable of meeting the needs 

of ETS programs for electric water 

heaters. In total, the utility respondents 

indicated that they realize a combined 

peak load reduction of approximately 

145 MW,9 and a cost savings of 

approximately 60 million dollars 10 in 

annual savings from being able to utilize 

more efficient, less expensive energy 

sources. Many utility companies stated 

that participation in ETS programs 

allows consumers to benefit from 

discounted energy rates and financial 

incentives such as rebates, financing, or 

free and reduced cost repair and 

maintenance. (Buckeye, No. 3 at p. 2; 

Codington-Clark, No. 4 at p. 2; 

Rappahannock, No. 5 at p. 2; Northern 

Plains No. 6 at p. 1; Itasca-Mantrap, No. 

7 at p. 1; Northwest Iowa Power, No. 8 

at p. 2; Barron, No. 11 at p. 1; Clark, No. 

13 at p. 2; Woodbury, No. 14 at p. 2; 

North West, No. 15 at p. 2; Bayfield, No. 

16 at p. 2; Union County, No. 17 at p. 

3; Allamakee-Clayton, No. 18 at p. 2; 

Lower Valley Energy, No. 19 at p. 2; 

Wabash, No. 21 at p. 2; Heartland, No. 

22 at p. 2; South Central, No. 23 at p. 

2; Cass County, No. 24 at p. 2; East 

River, No. 25 at p. 2; Richland, No. 26 

at p. 2; Lyon-Lincoln, No. 27 at p. 2; 

Price, No. 30 at p. 2; FEM, No. 32 at p. 

2; BEC, No. 33 at p. 2; Powell Valley, 

No. 34 at p. 2; Dakota Electric, No. 36 

at p. 2; Nishnabotna Valley REC, No. 37 

at p. 2; Iowa Lakes, No. 114 at p. 2; Corn 

Belt, No. 39 at p. 2; Clay-Union, No. 40 

at p. 2; Great River, No. 41 at p. 2; 

Central Georgia EMC, No. 42 at p. 2; 

Otter Tail, No. 44 at p. 2; ECSC, No. 45 

at p. 2; Aiken, No. 46 at p. 1; Connexus, 

No. 47 at p. 1; Dairyland, No. 48 at p. 

2; Pee Dee, No. 49 at p. 1; Oconto, No. 

50 at p. 2; Wright-Hennepin, No. 51 at 

p. 1; Lynches, No. 53 at p. 2; Horry, No. 

57 at p. 2; Pierce Pepin, No. 54 at p. 2; 

Palmetto, No. 56 at p. 2; Fairfield, No. 

59 at p. 2; Tri-State, No. 61 at p. 2; 

Santee, No. 62 at p. 2; Newberry, No. 64 

at p. 2; People’s Energy, No. 66 at p. 2; 

Eau Claire, No. 69 at p. 2; Edisto, No. 

70 at p. 2; Coastal, No. 71 at p. 2; Black 

River, No. 76 at p. 1; MCEC, No. 77 at 

p. 2; Blue Ridge, No. 82 at p. 2; NOVEC, 

No. 91 at p. 1; Black Hills, No. 96 at p. 

2; Verendrye, No. 97 at p. 1; Minnesota 

Valley, No. 101 at p. 1; McLeod, No. 102 

at p. 2; Mountain Electric, No. 109 at p. 

1; Leavenworth-Jefferson, No. 110 at p. 

2; Meeker, No. 112 at p. 3; Federated, 

No. 113 at p. 2; Thumb Electric, No. 115 

at p. 2; South Central Indiana REC, No. 

117 at p. 2; Tri-County Electric, No. 118 

at p. 2; Nobles, No. 119 at p. 2; Lake 

Region, No. 120 at p. 2; Sioux Valley, 

No. 123 at p. 1; East Central, No. 124 at 

p. 2; Jackson County, No. 126 at p. 2; 

Shenandoah Valley, No. 128 at p. 2; 

Adams Electric, No. 129 at p. 1; AdamsColumbia, No. 132 at p. 1; Stearns, No. 

134 at p. 1; Kandiyohi, No. 138 at p. 1; 

Habersham, No. 146 at p. 2; Flint, No. 

147 at p. 3; Dakota Valley and Northern 

Plains, No. 149 at p. 2; Aurelia, No. 151 

at p. 2; United Electric, No. 153 at p. 2). 

The joint utility commenters cited a 

survey conducted by NRECA of its 

cooperatively owned utility members 

which found that the average bill credit 

for participating customers per water 

heater is $58 a year. In addition to the 

bill credit, customers are often eligible 

to receive an upfront rebate to offset a 

portion of the purchase cost of certain 

eligible types of electric water heaters 

when the customer agrees to participate 

in the direct load control program. The 

average rebate among survey 

respondents that also offered the bill 

credits is $230. (Joint Utilities, No. 58 at 

p. 8) 

Through ETS programs for electric 

water heaters, utilities can require 

customers to heat and store hot water in 

times when overall electric demand and 

power-supply costs are low, thus 

lowering peak demand when costs are 

highest. Utilities contended that 

eliminating large volume electric 

resistance water heaters would reduce 

or eliminate ETS programs and would 

in turn result in higher electricity prices 

to consumers. (Buckeye, No. 3 at p. 2; 

Codington-Clark, No. 4 at p. 2; 

Rappahannock, No. 5 at p. 1; ItascaMantrap, No. 7 at p. 1; Northwest Iowa 

Power, No. 8 at p. 1; PowerSouth, No. 

10 at p. 1; Barron, No. 11 at p. 1; Clark, 

No. 13 at p. 1; Woodbury, No. 14 at p. 

2; North West, No. 15 at p. 1; Bayfield, 

No. 16 at p. 2; Union County, No. 17 at 

p. 1; Allamakee-Clayton, No. 18 at p. 1; 

Lower Valley Energy, No. 19 at p. 2; AO 

Smith, No. 20 at p. 1; Wabash, No. 21 

at pp.1–2; Heartland, No. 22 at p. 1; 

South Central, No. 23 at p. 2; Cass 

County, No. 24 at p. 1; East River, No. 

25 at p. 1; Richland, No. 26 at p. 3; 

Lyon-Lincoln Electric Cooperative, No. 

27 at pp. 1–3; Central, No. 28 at p. 1; 

Tri-County, No. 29 at p. 1; Price, No. 30 

at pp. 1–2; Bristol, No. 31 at p. 2; FEM, 

No. 32 at p. 1; BEC, No. 33 at p. 1; 

Powell Valley, No. 34 at p. 2; Humboldt, 

No. 35 at p. 1; Dakota Electric, No. 36 

at p. 1; Nishnabotna Valley REC, No. 37 

at p. 1; Corn Belt, No. 39 at p. 1; ClayUnion, No. 40 at p. 1; Great River, No. 

41 at p. 1; Central Georgia EMC, No. 42 

at p. 1; Otter Tail, No. 44 at p. 1; ECSC, 

No. 45 at p. 1; Aiken, No. 46 at p. 1; 

Connexus, No. 47 at p. 1; Dairyland, No. 

48 at p. 1; Pee Dee, No. 49 at p. 1; 

Oconto, No. 50 at p. 1; WrightHennepin, No. 51 at p. 1; Midland, No. 

52 at p. 1; Lynches, No. 53 at p. 1; Pierce 

Pepin, No. 54 at p. 2; Dunn, No. 55 at 

p. 1; Palmetto, No. 56 at p. 1; Horry, No. 

57 at p. 1; Joint Utility Commenters, No. 

58 at p. 4; Fairfield, No. 59 at p. 1; TriState, No. 61 at p. 1; Santee, No. 62 at 

p. 1; Newberry, No. 64 at p. 1; People’s 

Energy, No. 66 at p. 2; MECA, No. 67 

at p. 1; Eau Claire, No. 69 at p. 2; Edisto, 

No. 70 at p. 1; Coastal, No. 71 at p. 1; 

York, No. 73 at p. 1; Black River, No. 76 

at p. 1; MCEC, No. 77 at p. 1; Prairie, 

No. 78 at p. 1; Blue Ridge, No. 82 at p. 

1; Freeborn-Mower, No. 83 at p. 2; 

APPA, No. 84 at p. 3; Nebraska Public 

Power, No. 88 at p. 1; Clark Public 

Utilities, No. 90 at p. 1; NOVEC, No. 91 

at p. 1; Black Hills, No. 96 at p. 1; 


wreier-aviles on DSK5TPTVN1PROD with PROPOSALS
Federal Register / Vol. 78, No. 38 / Tuesday, February 26, 2013 / Proposed Rules 12975 

11Chris King and Dan Delurey, Efficiency and 

Demand Response: Twins, Siblings, or Cousins? 

Analyzing the conservation effects of demand 

response programs. Public Utilities Fortnightly, 

March 2005. Available at: http:// 

www.demandresponsecommittee.org/resource1009/efficiency%20and%20demand%20response

%20puf%2005%2003.pdf. 

Verendrye, No. 97 at p. 1; Dakota 

Energy, No. 98 at p. 1; Minnesota Rural, 

No. 99 at p. 1; Minnesota Valley, No. 

101 at p. 1; McLeod, No. 102 at p. 1; 

Lake Country, No. 108 at p. 1; Mountain 

Electric, No. 109 at p. 1; LeavenworthJefferson, No. 110 at p. 1; Riverland, No. 

111 at p. 1; Meeker, No. 112 at p. 1; 

Federated, No. 113 at p. 1; Iowa Lakes, 

No. 114 at p. 1; Thumb Electric, No. 115 

at p. 1; South Central Indiana REC, No. 

117 at p. 1; Tri-County Electric, No. 118 

at p. 1; Nobles, No. 119 at p. 1; Lake 

Region, No. 120 at p. 1; Sioux Valley, 

No. 123 at p. 1; East Central, No. 124 at 

p. 1; Jackson County, No. 126 at p. 1; 

Duck River, No. 127 at p. 1; Shenandoah 

Valley, No. 128 at p. 1; Adams, No. 129 

at p. 1; Goodhue, No. 130 at p. 1; 

Adams-Columbia, No. 132 at p. 1; 

Stearns, No. 134 at p. 1; Kandiyohi, No. 

138 at p. 1; Shelby, No. 143 at p. 1; 

Beltrami, No. 145 at p. 1: Habersham, 

No. 146 at p. 1; Flint, No. 147 at p. 2; 

Dakota Valley and Northern Plains, No. 

149 at p. 1; Aurelia, No. 151 at p. 2; 

United Electric, No. 153 at p. 1) 

Many utilities stated that ETS water 

heating programs have become a 

popular low-cost option for their 

members who do not have access to 

natural gas, as it allows them to heat 

water using electricity at lower cost. 

(Itasca-Mantrap, No. 7 at p. 2; Northwest 

Iowa Power, No. 8 at p. 2; Barron, No. 

11 at p. 1; Clark, No. 13 at p. 2; 

Woodbury, No. 14 at p. 2; North West, 

No. 15 at p. 1; Bayfield, No. 16 at p. 2; 

Cass County, No. 24 at p. 2. Price, No. 

30 at p. 2; Dakota Electric, No. 36 at p. 

5; Nishnabotna Valley REC, No. 37 at p. 

2; Great River, No. 41 at p. 2; Otter Tail, 

No. 44 at p. 2; Dairyland, No. 48 at p. 

2; Wright-Hennepin, No. 51 at p. 2; 

Pierce Pepin, No. 54 at p. 2; Dunn, No. 

55 at p. 2; People’s Energy, No. 66 at p. 

2; Eau Claire, No. 69 at p. 1; FreebornMower, No. 83 at p. 2; Minnesota Rural, 

No. 99 at p. 1; Minnesota Valley, No. 

101 at p. 1; McLeod, No. 102 at p. 1; 

Riverland, No. 111 at p. 2; Meeker, No. 

112 at p. 2; Federated, No. 113 at p. 2; 

Lake Region, No. 120 at p. 1; Goodhue, 

No. 130 at p. 1; Stearns, No. 134 at p. 

1; Kandiyohi, No. 138 at p. 1) 

Some utilities also stated that their 

ETS programs provide energy savings 

benefits because they serve as a tool to 

educate their members to help them 

understand and participate in programs 

that save energy and money for all 

members. (Union County, No. 17 at p. 

1; Humboldt, No. 35 at p. 1; Dakota 

Electric, No. 36 at p. 2; Corn Belt, No. 

39 at p. 2; Oconto, No. 50 at p. 2; Lake 

Country, No. 108 at p. 1; Jackson 

County, No. 126 at p. 2; Duck River, No. 

127 at p. 2) Utilities stated that their 

ETS programs promote energy 

conservation because the amount of 

energy used for domestic hot water 

needs is determined more by the 

amount of water used than by the 

efficiency of the water heater, and 

customers who know they have limits 

on their hot water capacity tend to 

conserve hot water. (Rappahannock, No. 

5 at p. 2; Northwest Iowa Power, No. 8 

at p. 2; Woodbury, No. 14 at p. 2; North 

West, No. 15 at p. 1; Dakota Electric, No. 

36 at p. 2; Nishnabotna Valley REC, No. 

37 at p. 2;Otter Tail, No. 44 at p. 3; 

Dairyland, No. 48 at p. 6, Minnesota 

Valley, No. 101 at p. 2; McLeod, No. 102 

at p. 2; Meeker, No. 112 at p. 1; South 

Central Indiana REC, No. 117 at p. 1; 

Lake Region, No. 120 at p. 2; Goodhue, 

No. 130 at p. 1; Stearns, No. 134 at p. 

2; Kandiyohi, No. 138 at p. 2; Aurelia, 

No. 151 at p. 2) 

Dairyland commented that studies 

indicate that participation in certain 

demand response programs can also 

result in an energy conservation effect. 

Specifically, Dairyland cited a 2005 

study 11 of more than 200 demand 

response programs which found that 

dynamic pricing programs resulted in 

average total energy savings of four 

percent. The study also found that 

programs that combine dynamic pricing 

with automated control of consumer 

devices produce an even greater energy 

conservation effect, because according 

to the study, dynamic pricing programs 

cause participants to have a higher 

awareness of how they use energy, 

which, in turn, results in lower 

consumption. (Dairyland, No. 48 at p. 6) 

Utilities also described how the 

utilities themselves benefit from an 

increased ability to manage peak load. 

Many utility companies indicated that 

the reduction or elimination of ETS 

programs would force utilities to spend 

more money on meeting increased peak 

generation needs. (Rappahannock, No. 5 

at p. 2; PowerSouth, No. 10 at p. 1; 

Clark, No. 13 at p. 2; Bayfield, No. 16 

at p. 2; Union County, No. 17 at p. 3; 

Lower Valley Energy, No. 19 at p. 2; 

Wabash, No. 21 at p. 2; Heartland, No. 

22 at p. 2; Cass County, No. 24 at p. 3; 

East River, No. 25 at p. 1; Central, No. 

28 at p. 2; Tri-County, No. 29 at p. 2; 

Price, No. 30 at p. 2; Bristol, No. 31 at 

p. 2; FEM, No. 32 at p. 2; BEC, No. 33 

at p. 2; Central Georgia EMC, No. 42 at 

p. 2; ECSC, No. 45 at p. 2; Aiken, No. 

46 at p. 2; Dairyland, No. 48 at pp. 2– 

3; Oconto, No. 50 at p. 2; WrightHennepin, No. 51 at p. 2; Lynches, No. 

53 at p. 2; Pierce Pepin, No. 54 at p. 2; 

Dunn, No. 55 at p. 2; Palmetto, No. 56 

at p. 2; Horry, No. 57 at p. 1; Fairfield, 

No. 59 at p. 2; Tri-State, No. 61 at p. 5; 

Santee, No. 62 at p. 2; Newberry, No. 64 

at p. 2; People’s Energy, No. 66 at p. 2; 

Eau Claire, No. 69 at p. 2; Edisto, No. 

70 at p. 2; Coastal, No. 71 at p. 2; York, 

No. 73 at p. 2; Black River, No. 76 at p. 

2; MCEC, No. 77 at p. 2; Blue Ridge, No. 

82 at p. 2; Freeborn-Mower, No. 83 at p. 

2; APPA, No. 84 at p. 2; Clark Public 

Utilities, No. 90 at p. 1; Mountain 

Electric, No. 109 at p. 1; Tri-County 

Electric, No. 118 at p. 2; Sioux Valley, 

No. 123 at p. 2; East Central, No. 124 at 

p. 1; Jackson County, No. 126 at p. 2; 

Habersham, No. 146 at p. 1; Flint, No. 

147 at p. 3) 

A number of utility companies also 

argued that ETS programs benefit the 

electric grid by improving reliability 

and reducing system losses. 

Commenters stated that these effects are 

the result of improved utilization of the 

generation and transmission system 

infrastructure and improved system 

load factors. (Buckeye, No. 3 at pp. 1– 

3; Codington-Clark, No. 4 at p. 1; ItascaMantrap, No. 7 at p. 1; PowerSouth, No. 

10 at p. 2; Union County, No. 17 at p. 

3; Allamakee-Clayton, No. 18 at p. 2, 

Lower Valley Energy, No. 19 at p. 1–2; 

Wabash, No. 21 at p. 2; Heartland, No. 

22 at p. 1; South Central, No. 23 at p. 

1; Cass County, No. 24 at p. 2; East 

River, No. 25 at p. 2; Lyon-Lincoln, No. 

27 at p. 1–2; Central, No. 28 at p. 1; TriCounty, No. 29 at p. 2; Bristol, No. 31 

at p. 2; FEM, No. 32 at p. 1; BEC, No. 

33 at p. 1; Powell Valley, No. 34 at p. 

2; Dakota Electric, No. 36 at p. 3; Corn 

Belt, No. 39 at p. 2; Dairyland, No. 48 

at p. 2; Clay-Union, No. 40 at p. 1; Great 

River, No. 41 at p. 1; No. 48 at p. 3; 

Central Georgia EMC, No. 42 at p. 1; 

Otter Tail, No. 44 at p. 2; ECSC, No. 45 

at p. 1; Aiken, No. 46 at p. 1; Connexus, 

No. 47 at p. 2; Pee Dee, No. 49 at p. 1; 

Oconto, No. 50 at p. 2; Lynches, No. 53 

at p. 1; Palmetto, No. 56 at p. 2; Horry, 

No. 57 at p. 1; Joint Utility Commenters, 

No. 58 at p. 17; Fairfield, No. 59 at p. 

2; NEMA, No. 60 at p. 2; Tri-State, No. 

61 at p. 5; Santee, No. 62 at p. 2; 

Newberry, No. 64 at p. 1; MECA, No. 67 

at p. 1; Edisto, No. 70 at p. 1; Coastal, 

No. 71 at p. 1; York, No. 73 at p. 1; Black 

River, No. 76 at p. 1; MCEC, No. 77 at 

p. 2; Prairie, No. 78 at p. 1; ALP, No. 79 

at p. 1; Blue Ridge, No. 82 at p. 2; 

NOVEC, No. 91 at p. 1; WrightHennepin, No. 51 at p. 2; Black Hills, 

No. 96 at p. 1; Verendrye, No. 97 at p. 

1; Dakota Energy, No. 98 at p. 1; Lake 

Country, No. 108 at p. 1; Mountain 


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Electric, No. 109 at p. 1; Meeker, No. 

112 at p. 1; Federated, No. 113 at p. 1; 

Iowa Lakes, No. 114 at p. 1; Thumb 

Electric, No. 115 at p. 1; South Central 

Indiana REC, No. 117 at p. 1; Tri-County 

Electric, No. 118 at p. 1; Nobles, No. 119 

at p. 1; Lake Region, No. 120 at p. 1; 

Sioux Valley, No. 123 at p. 1; Jackson 

County, No. 126 at p. 2; Duck River, No. 

127 at p. 2; Shenandoah Valley, No. 128 

at p. 1; Adams, No. 129 at p. 1; Senator 

John Thune, No. 137 at p. 1; Shelby, No. 

143 at p. 1; Habersham, No. 146 at p. 1; 

Flint, No. 147 at p. 3; Dakota Valley and 

Northern Plains, No. 149 at p. 1; United 

Electric, No. 153 at p. 1) Several utilities 

also mentioned that their load control 

program can help facilitate the 

restoration of electric service during 

extreme weather emergencies. (Powell 

Valley, No. 34 at p. 2; Blue Ridge, No. 

82 at p. 1; NOVEC, No. 91 at p. 2; 

United Electric, No. 153 at p. 1) 

According to utility companies, the 

reduction in energy usage during peak 

times from ETS programs allows the 

utilities to increase utilization of more 

efficient generation facilities while 

simultaneously providing a method of 

integrating intermittent renewable 

energy sources into the electric grid. 

(Central Georgia EMC, No. 42 at p. 2; 

Codington-Clark, No. 4 at p. 2; ItascaMantrap, No. 7 at p. 1; Northwest Iowa 

Power, No. 8 at p. 2; Barron, No. 11 at 

p. 1; Clark, No. 13 at p. 1; Woodbury, 

No. 14 at p. 2; North West, No. 15 at p. 

2; Bayfield, No. 16 at p. 1; AllamakeeClayton, No. 18 at p. 2; Lower Valley 

Energy, No. 19 at p. 2; AO Smith, No. 

20 at p. 1; Wabash, No. 21 at p. 2; South 

Central, No. 23 at p. 2; East River, No. 

25 at p. 2; Richland, No. 26 at p. 3; 

Lyon-Lincoln Electric Cooperative, No. 

27 at p. 2; Price, No. 30 at p. 1; BEC, 

No. 33 at p. 3; Humboldt, No. 35 at p. 

1; Dakota Electric, No. 36 at p. 2; 

Nishnabotna Valley REC, No. 37 at p. 2; 

Great River, No. 41 at p. 3; Otter Tail, 

No. 44 at p. 3; Connexus, No. 47 at p. 

1; Dairyland, No. 48 at p. 3; Midland, 

No. 52 at p. 2; Pierce Pepin, No. 54 at 

p. 2; Dunn, No. 55 at p. 2; Tri-State, No. 

61 at p. 2; People’s Energy, No. 66 at p. 

2; MECA, No. 67 at p. 1; Eau Claire, No. 

69 at p. 1; EPRI, No. 74 at p 2–4; Prairie, 

No. 78 at p. 2; Freeborn-Mower, No. 83 

at p. 2; Nebraska Public Power, No. 88 

at p. 1; Corn Belt, No. 39 at p. 2; ClayUnion, No. 40 at p. 2; Wright-Hennepin, 

No. 51 at p. 2; HTP, No. 87 at p. 1; 

NOVEC, No. 91 at p. 4; Black Hills, No. 

96 at p. 2; Minnesota Rural, No. 99 at 

p. 1; Minnesota Valley, No. 101 at p. 1; 

McLeod, No. 102 at p. 1; Lake Country, 

No. 108 at p. 1; Riverland, No. 111 at p. 

1; Meeker, No. 112 at p. 2; Federated, 

No. 113 at p. 2; Nobles, No. 119 at p. 

1; Lake Region, No. 120 at p. 1; 

Congressman Dan Burton, No. 122 at p. 

1; East Central, No. 124 at p. 2; 

Goodhue, No. 130 at p. 2; Stearns, No. 

134 at p. 2; Senator John Thune, No. 137 

at p. 1; Beltrami, No. 145 at p. 1; 

Habersham, No. 146 at p. 3; Aurelia, No. 

151 at p. 2) 

After considering the information 

presented by stakeholders regarding the 

benefits of ETS programs to consumers, 

utilities, and the Nation, DOE is 

persuaded by the information submitted 

by the utility companies given their 

expertise in administering demand 

response programs, regarding the 

benefits of ETS programs. DOE believes 

that the evidence presented indicates 

that these programs provide a number of 

valuable benefits to consumers, utilities, 

and the Nation. As a result, DOE agrees 

with the majority of commenters that 

action should be taken to mitigate the 

impacts of the April 2010 final rule 

standard levels on utility ETS programs 

in order to help preserve these benefits, 

if no practical alternatives exist to allow 

for the continuation of ETS programs in 

the absence of large-volume ERWHs. 

Accordingly, DOE considered whether 

practical alternatives exist that would 

allow the existing ETS programs to 

continue to be effective despite the 

potential unavailability of large volume 

ERWHs. DOE’s consideration of this 

issue, as well as comments received, are 

discussed in section 0. 

2. Alternatives to Large-Volume Electric 

Resistance Water Heaters To Serve the 

Needs of ETS Programs 

DOE recognizes that participants in 

ETS programs need more hot water 

storage capacity than they would 

require absent their participation in 

such programs. However, as noted in 

the June 2012 RFI, DOE believes that 

there are potential alternatives that may 

be able to provide a comparable amount 

of water storage capacity required for 

these programs. These potential 

alternatives include large-volume 

HPWHs and multiple (two or more) 

small-volume ERWHs. A number of 

stakeholders argued that heat pump 

water heaters and multiple smallvolume water heaters are not wellsuited for ETS programs and would not 

be a viable replacement for large-volume 

ERWHs in these applications. The 

points that the commenters raised are 

discussed below. 

Many utility company commenters 

emphasized that managing a load 

control program is a balance of 

controlling load while maintaining 

customer satisfaction. Utilities stated 

that large volume ERWHs are required 

to ensure ETS program participants 

have enough hot water and remain 

satisfied with the program. These 

commenters asserted that smaller tanks 

reduce the amount of storage capacity 

and thus require more recharge time 

between control periods to ensure 

customers have enough hot water. 

Conversely, large capacity water heaters 

allow consumers to have enough hot 

water during control periods. (Buckeye, 

Inc. No. 3 at p. 1; Codington-Clark, No. 

4 at p. 2; Northwest Iowa Power, No. 8 

at p. 2; PowerSouth, No. 10 at p. 2; 

Barron, No. 11 at p. 1; Clark, No. 13 at 

p. 1; Woodbury, No. 14 at p. 1; North 

West, No. 15 at p. 2; Bayfield, No. 16 at 

p. 2; Union County, No. 17 at p. 1; 

South Central, No. 23 at p. 1; Cass 

County, No. 24 at p. 3; East River, No. 

25 at p. 2; Richland, No. 26 at p. 1; 

Lyon-Lincoln Electric Cooperative, No. 

27 at p. 2; Price, No. 30 at p. 1; Bristol, 

No. 31 at p. 2; FEM, No. 32 at p. 2; 

Nishnabotna Valley REC, No. 37 at p. 2; 

Corn Belt, No. 39 at pp. 2–3; ClayUnion, No. 40 at p. 2; Great River, No. 

41 at p. 1; Central Georgia EMC, No. 42 

at p. 2; Otter Tail, No. 44 at p. 2; WrightHennepin, No. 51 at p. 1; Pierce Pepin, 

No. 54 at p. 2; Dunn, No. 55 at p. 1; 

Horry, No. 57 at p. 2; Fairfield, No. 59 

at p. 2; Tri-State, No. 61 at p. 3; People’s 

Energy, No. 66 at p. 2; Eau Claire, No. 

69 at p. 1; Prairie, No. 78 at p. 2; 

Freeborn-Mower, No. 83 at p. 2; Black 

Hills, No. 96 at p. 2; Riverland, No. 111 

at p. 1; Meeker, No. 112 at p. 1; TriCounty Electric, No. 118 at p. 2; Nobles, 

No. 119 at p. 2; Sioux Valley, No. 123 

at p. 2; East Central, No. 124 at p. 2; 

Jackson County, No. 126 at p. 1; 

Goodhue, No. 130 at p. 1;Aurelia, No. 

151 at p. 2; United Electric, No. 153 at 

p. 2) 

A number of parties stated that the 

heat pump unit is, by itself, incapable 

of heating water to the temperatures 

needed for ETS programs. (PowerSouth, 

No. 10 at p. 3; Barron, No. 11 at p. 2; 

Clark, No. 13 at p. 2; Bayfield, No. 16 

at p. 2; Allamakee-Clayton, No. 18 at p. 

2; A. O. Smith, No. 20 at p. 2; Richland, 

No. 26 at p. 3; Price, No. 30 at p. 2; 

Bristol, No. 31 at p. 1; Great River, No. 

41 at p. 4; Dairyland, No. 48 at p. 4; 

Pierce Pepin, No. 54 at p. 2; Dunn, No. 

55 at p. 2; Joint Utilities, No. 58 at p. 

13; People’s Energy, No. 66 at p. 2; Eau 

Claire, No. 69 at p. 2; Vaughn, No. 72 

at p. 6; ALP, No. 79 at p. 1; FreebornMower, No. 83 at p. 2; APPA, No. 84 at 

p. 2; Clark Public Utilities, No. 90 at p. 

1; NOVEC, No. 91 at p. 4; Riverland, No. 

111 at p. 2; Adams-Columbia, No. 132 

at p. 2; Habersham, No. 146 at p. 3) 

GE and the Northwest Advocates 

comment noted that using the electric 

resistance elements of an HPWH, it is 

possible to reach higher temperatures as 


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Federal Register / Vol. 78, No. 38 / Tuesday, February 26, 2013 / Proposed Rules 12977 

well as heat the water faster. (GE, No. 85 

at p. 3; Northwest Advocates, No. 89, at 

p. 4) AO Smith commented that not all 

HPWHs have electric resistance 

elements that are large enough to allow 

them to achieve the necessary 

temperatures for ETS programs. But AO 

Smith also stated that even for HPWHs 

that do have a resistance element that is 

large enough to achieve the needed tank 

temperature, the unit would be 

operating like a very expensive ERWH. 

(Rappahannock, No. 5 at p. 2; A. O. 

Smith, No. 20 at p. 2; Great River, No. 

41 at p. 4; Dairyland, No. 48 at p. 4; 

Joint Utilities, No. 58 at p. 16; NEMA, 

No. 60 at p. 4; EPRI, No. 74 at p. 3; 

NOVEC, No. 91 at p. 4; AdamsColumbia, No. 132 at p. 2; Habersham, 

No. 146 at p. 3; Dakota Valley and 

Northern Plains, No. 149 at p. 1; ECE, 

No. 124 at p. 3) 

DOE believes that most HPWHs are 

technically capable of heating water to 

the temperatures needed for ETS 

programs, but would need to use the 

electric resistance elements in order to 

heat the tank to temperatures above the 

maximum temperature limits of current 

HPWH refrigerants. The need to use the 

electric resistance element would lower 

overall efficiency and reduce the energy 

and cost savings that would otherwise 

result from the use of a HPWH. DOE has 

not attempted to quantify such energy 

and cost savings differences in this 

NPRM, but could do so in evaluating 

specific waiver requests. 

Several interested parties noted that 

use of HPWHs in ETS programs would 

lead to deterioration of the compressor 

due to frequent on/off cycling for 

demand response purposes, and the 

frequent on/off cycle would also reduce 

the efficiency of the HPWH. 

(PowerSouth, No. 10 at p. 3; Barron, No. 

11 at p. 2; Clark, No. 13 at p. 2; Bayfield, 

No. 16 at p. 2; Allamakee-Clayton, No. 

18 at p. 2; Richland, No. 26 at p. 3; TriCountry, No. 29 at p. 2; Price, No. 30 at 

p. 2; Powell Valley, No. 34 at p. 3; Great 

River, No. 41 at p. 3; Dairyland, No. 48 

at p. 4; Pierce Pepin, No. 54 at p. 2; 

Dunn, No. 55 at p. 2; Joint Utilities, No. 

58 at p. 14; NEMA, No. 60 at p. 3; 

People’s Energy, No. 66 at p. 2; Eau 

Claire, No. 69 at p. 2; EPRI, No. 74 at 

p. 3; ALP, No. 79 at p. 1; FreebornMower, No. 83 at p. 2; APPA, No. 84 at 

p. 2; Clark Public Utilities, No. 90 at p. 

1; NOVEC, No. 91 at p. 4; Riverland, No. 

111 at p. 2; Federated, No. 113 at p. 2; 

Habersham, No. 146 at p. 3) EPRI stated 

that using variable speed compressors in 

HPWHs is a solution to the start-stop 

operation problem, but additional 

research is needed in order to 

understand whether this HPWH design 

can yield efficiency gains and emerge as 

a cost-effective solution for customers 

and the grid. (EPRI, No. 74 at p. 3) 

DOE understands that while a HPWH 

might cycle frequently in some ETS 

applications, the minimum run times 

for existing HPWHs are sufficiently long 

(30 minutes) that on/off cycling is 

unlikely to lead to deterioration of the 

compressor. DOE agrees that variable 

speed compressors may be useful, but 

notes that the benefits of this technology 

have not yet been demonstrated and the 

cost of this option is still uncertain. 

Several stakeholders stated that using 

a vapor-compression cycle to heat water 

increases operating time compared to 

electric resistance heating, so there 

would be a smaller time window for 

load reduction and less opportunity for 

load shifting. (Buckeye, No. 3 at p. 2; 

Codington-Clark, No. 4 at p. 2; Bayfield, 

No. 16 at p. 2; Union County, No. 17 at 

p. 3; A. O. Smith, No. 20 at p. 4; Cass 

County, No. 24 at p. 4; East River, No. 

25 at p. 2; Richland, No. 26 at p. 3; 

Lyon-Lincoln, No. 27 at p. 2; Corn Belt, 

No. 39 at p. 3; Clay-Union, No. 40 at p. 

2; Great River, No. 41 at p. 3; ECSC, No. 

45 at p. 3; Dairyland, No. 48 at p. 4; Pee 

Dee, No. 49 at p. 2; Lynches, No. 53 at 

p. 3; Pierce Pepin, No. 54 at p. 2; 

Palmetto, No. 56 at p. 2; Joint Utilities, 

No. 58 at p. 16; Fairfield, No. 59 at p. 

3; NEMA, No. 60 at p. 3; York, No. 73 

at p. 4; EPRI, No. 74 at p. 4; Black River, 

No. 76 at p. 2; Prairie, No. 78 at p. 2; 

ALP, No. 79 at p. 1; Blue Ridge, No. 82 

at p. 2; Freeborn-Mower, No. 83 at p. 2; 

APPA, No. 84 at p. 2; Clark Public 

Utilities, No. 90 at p. 1; NOVEC, No. 91 

at p. 4; Nobles, No. 119 at p. 2; AdamsColumbia, No. 132 at p. 2; Habersham, 

No. 146 at p. 3; ECE, No. 124 at p. 2; 

FEM, No. 32 at p. 2; Iowa Lakes, No. 114 

at p. 3; Aiken, No. 46 at p. 2; ItascaMantrap, No. 7 at p. 2) 

DOE agrees that HPWHs have slower 

recovery when operating in heat pump 

only mode, but believes that this issue 

could be overcome by utilizing the 

backup electric resistance elements or 

by using water heaters with even larger 

rated volumes than currently used in 

ETS programs. However, DOE notes that 

if prolonged operation using electric 

resistance elements is required, the 

overall efficiency of the water heater 

will be lowered. 

Several parties stated that HPWHs 

have additional total installed cost, 

which makes them less economically 

feasible for ETS programs. (PowerSouth, 

No. 10 at p. 3; Bayfield, No. 16 at p. 2; 

Cass County, No. 24 at p. 5; East River, 

No. 25 at p. 2; Richland, No. 26 at p. 2; 

Tri-Country, No. 29 at p. 3; BEC, No. 33 

at p. 3; Dakota Electric, No. 36 at p. 4; 

Otter Tail, No. 44 at p. 3; ECSC, No. 45 

at p. 3; Connexus, No. 47 at p. 1; 

Dairyland, No. 48 at p. 5; Pee Dee, No. 

49 at p. 2; Wright-Hennepin, No. 51 at 

p. 1; Lynches, No. 53 at p. 3; Palmetto, 

No. 56 at p. 2; Horry, No. 57 at p. 4; Joint 

Utilities, No. 58 at p. 14; Fairfield, No. 

59 at p. 3; Newberry, No. 64 at p. 3; 

Edisto, No. 70 at p. 3; Coastal, No.71 at 

p. 3; Vaughn, No. 72 at p. 2 to 3; York, 

No. 73 at p. 2; Black River, No.76 at p. 

3; MCEC, No. 77 at p. 2; Blue Ridge, No. 

82 at p. 2; Clark Public Utilities, No. 90 

at p. 1; NOVEC, No. 91 at p. 4; 

Verendrye, No. 97 at p. 1; Dakota 

Energy, No. 98 at p. 1; Minnesota Rural, 

No. 99 at p. 1; Mountain Electric, No. 

109 at p. 1; Leavenworth-Jefferson, No. 

110 at p. 1; Meeker, No. 112 at p. 2; 

Iowa Lakes, No. 114 at p. 2; Federated, 

No. 115 at p. 2; Thumb Electric, No. 115 

at p. 1; SCI REMC, No. 117 at p. 1; TriCounty, No. 118 at p. 1; Nobles, No. 119 

at p. 1; LREC, No. 120 at p. 1; Sioux 

Valley, No. 123 at p. 1; Jackson County, 

No. 126 at p. 2; Adams-Columbia, No. 

132 at p. 2; People’s Energy, No. 142 at 

p. 1; Beltrami, No. 145 at p. 1; 

Habersham, No. 146 at p. 3; Flint, No. 

147 at p. 1; Aurelia, No. 151 at p. 1; 

United Electric, No. 153 at p. 1; ECE, 

No. 124 at p. 2; Iowa Lakes, No. 114 at 

p. 3; Aiken, No. 46 at p. 2; Santee, No. 

62 at p. 1) 

DOE agrees that a large HPWH would 

have much higher installed cost than a 

large ERWH. The extent to which this 

would be balanced by lower operating 

costs would vary among ETS programs. 

DOE notes this increase in first installed 

cost could have an adverse impact on 

utility ETS programs, in which 

customer participation is voluntary, 

because a utility customer may be less 

willing to take on the additional 

installed cost of a HPWH to participate 

in the program. 

Several of the interested parties stated 

that HPWHs require larger installation 

space and larger surrounding air 

volume. Some of the parties also stated 

that such requirements could force the 

consumer to switch to two smaller 

ERWHs, which would lead to increased 

costs for purchase and maintenance (as 

compared to a large-volume ERWH) and 

lower efficiency. (Rappahannock, No. 5 

at p. 2; PowerSouth, No. 10 at p. 3; 

Woodbury, No. 14 at p. 1; North West, 

No. 15 at p. 1; Bayfield, No. 16 at p. 2; 

Union County, No. 17 at p. 3; Cass 

County, No. 24 at p. 3; Lyon-Lincoln, 

No. 27 at p. 2; Tri-Country, No. 29 at p. 

4; Price, No. 30 at p. 2; Bristol, No. 31 

at p. 1; BEC, No. 33 at p. 2; Dakota 

Electric, No. 36 at p. 2; Corn Belt, No. 

39 at p. 3; Clay-Union, No. 40 at p. 2; 

Otter Tail, No. 44 at p. 3; ECSC, No. 45 

at p. 3; Connexus, No. 47 at p. 1; Pee 

Dee, No. 49 at p. 2; Lynches, No. 53 at 

p. 3; Dunn, No. 55 at p. 2; Palmetto, No. 


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12978 Federal Register / Vol. 78, No. 38 / Tuesday, February 26, 2013 / Proposed Rules 

12AO Smith’s comment stated that they ‘‘would 

not object to’’ a new product class. DOE interprets 

this as implying support for this approach because 

AO Smith also indicated that it supports the 

continued existence of electric resistance storage 

water heaters with storage volumes above 55 

gallons, disagreed with all of the other options 

listed, and did not offer an alternative. 

56 at p. 2; Horry, No. 57 at p. 4; Joint 

Utilities, No. 58 at p. 19; Fairfield, No. 

59 at p. 3; NEMA, No. 60 at p. 4; 

Newberry, No. 64 at p. 2; Eau Claire, No. 

69 at p. 3; Edisto, No. 70 at p. 3; Coastal, 

No. 71 at p. 3; Vaughn, No. 72 at p. 5; 

York, No. 73 at p. 2; Black River, No. 76 

at p. 3; MCEC, No. 77 at p. 2; Blue 

Ridge, No. 82 at p. 2; Freeborn-Mower, 

No. 83 at p. 2; APPA, No. 84 at p. 2; 

Clark Public Utilities, No. 90 at p. 1; 

NOVEC, No. 91 at p. 5; Minnesota 

Valley, No. 101 at p. 1; Federated, No. 

113 at p. 2; Tri-County, No. 118 at p. 2; 

Nobles, No. 119 at p. 2; Shenandoah 

Valley, No. 128 at p. 2; Goodhue, No. 

130 at p. 1; Adams-Columbia, No. 132 

at p. 2; Stearns, No. 134 at p. 1; 

Habersham, No. 146 at p. 3; Flint, No. 

147 at p. 1; Aurelia, No. 151 at p. 1; 

McLeod, No. 102 at p. 1; ECE, No. 124 

at p. 2; Kandiyohi, No. 138–141 at p. 1; 

FEM, No. 32 at p. 2; Nishnabotna Valley 

REC, No. 37 at p. 1; Iowa Lakes, No. 114 

at p. 3; Aiken, No. 46 at p. 2; Santee, No. 

62 at p. 2) AO Smith stated that using 

two smaller water heaters in place of 

one large water heater for ETS programs 

is technologically achievable, but it 

would increase the complexity and cost 

of the control scheme and installation. 

(AO Smith, No. 20 at p. 3) Several 

utilities noted that a large portion of 

consumers enrolled in their ETS 

programs live in mobile homes, which 

are particularly challenging to retrofit 

with HPWHs due to space constraints. 

(Tri-Country, No. 29 at p. 2; BEC, No. 33 

at p. 3; ECSC, No. 45 at p. 3; Pee Dee, 

No. 49 at p. 2; Lynches, No. 53 at p. 3; 

Palmetto, No. 56 at p. 2; Fairfield, No. 

59 at p. 3; Newberry, No. 64 at p. 3; 

Edisto, No. 70 at p. 3; Coastal, No. 71 

at p. 3; York, No. 73 at p. 2; Black River, 

No. 76 at p. 3; MCEC, No. 77 at p. 3; 

Blue Ridge, No. 82 at p. 2; AdamsColumbia, No. 132 at p. 2; Aiken, No. 

46 at p. 2; Santee, No. 62 at p. 3) 

DOE believes that the use of two 

smaller water heaters in place of one 

large water heater for ETS programs 

could be a viable option in some cases. 

However, DOE agrees that there are 

situations where a consumer in an ETS 

program would have difficulty 

physically accommodating a HPWH or 

multiple smaller water heaters, resulting 

in higher installation expenses. 

The Northwest Advocates commented 

that HPWHs can provide the same load 

shifting and ancillary services (load 

following and regulation) and benefits 

that are provided by ERWHs. They also 

stated that with additional programming 

(and no additional material costs) the 

HPWH controls can be adapted to 

provide ETS capabilities and the same 

functionality as resistance-only gridinteractive water heaters. (Northwest 

Advocates, No. 89, at p. 2) Similarly, GE 

argued that because all HPWHs use 

electronic controls as opposed to the 

electromechanical controls found on 

most standard electric water heaters, 

these products can much more easily 

interact with the grid and provide 

simpler ETS capability. (GE, No. 85 at 

p. 2) GE stated that the concerns that 

HPWHs will not be able to fill the same 

role as large volume resistance water 

heaters are not technologically justified. 

GE added that new larger capacity 

HPWH models may need to be 

produced, but there is no inherent 

reason why that cannot be done. (GE, 

No. 85 at p. 3) 

DOE believes that from a technical 

perspective HPWHs could substitute for 

ERWHs in ETS programs. Future 

improvements in HPWH design such as 

variable speed compressors, use of 

higher temperature refrigerants and 

refinements to controls may improve 

HPWHs’ suitability for use in ETS 

programs. DOE also believes that 

multiple smaller ERWHs are a feasible 

alternative to a large-volume ERWH, but 

may lower the system efficiency of the 

water heating process and may not be an 

option in space constrained 

installations. Additionally, DOE 

believes that the installed cost of 

currently available HPWH models or 

multiple small-volume ERWHs instead 

of a single large-volume ERWH and the 

need to often operate HPWHs in electric 

resistance mode to serve the demands of 

ETS programs could limit the 

attractiveness of participation in ETS 

programs. Additional analysis and data 

would be needed to determine the 

precise effect of unavailability of largevolume ERWHs on participation in ETS 

programs. 

Based on the above considerations, 

DOE concludes that products that are 

currently available on the market that 

meet the April 2010 standard levels may 

not be practical to fulfill the needs of 

utility ETS programs. Therefore, as 

discussed immediately below, DOE 

considered two approaches— 

establishing a separate product class 

and establishing a waiver process. See 

sections 3 and 0, respectively. 

3. Potential for a Separate Product Class 

for ‘‘Grid-Interactive’’ Electric Storage 

Water Heaters 

Twenty-three utility companies and 

associations, four manufacturers, one 

trade association (NEMA), and three 

U.S. Congressmen recommended that 

DOE establish a separate product class 

for grid interactive water heaters. 

(Itasca-Mantrap No. 7 at p. 2; Barron, 

No. 11 at p. 2; Clark, No. 13 at p. 2; 

Bayfield, No. 16 at p. 2; East River, No. 

25 at p. 3; Richland, No. 26 at p. 3; 

Lyon-Lincoln Electric Cooperative, No. 

27 at p. 3; Price, No. 30 at p. 2; Dakota 

Electric, No. 36 at p. 5; Corn Belt, No. 

39 at p. 3; Otter Tail, No. 44 at p. 4; 

Dairyland, No. 48 at p. 6; Pierce Pepin, 

No. 54 at p. 2; Dunn, No. 55 at p. 2; Joint 

Utilities, No. 58 at p. 4; People’s Energy, 

No. 66 at p. 2; MECA, No. 67 at p. 1; 

Eau Claire, No. 69 at p. 3; ALP, No. 79 

at p. 1; Freeborn-Mower, No. 83 at pp. 

2–3; APPA, No. 84 at p. 3; HTP, No. 87 

at p. 1; Nebraska Public Power, No. 88 

at p. 1; Rheem, No. 86 at p. 2; Giant 

Factories, No. 65 at p. 2; AO Smith 12, 

No. 20 at p. 2; NEMA, No. 60 at p. 4; 

Congressman Todd Rokita, No. 93 at p. 

1; Riverland, No. 111 at p. 2; 

Congressman Dan Burton, No. 122 at p. 

1; Senator John Thune, No. 137 at p. 1) 

The Joint Utilities urged the Secretary 

to use the authority granted pursuant to 

42 U.S.C. 6295(o)(2)(A) to develop a 

new standard for large-volume electric 

resistance water heaters that interact 

with the grid. Specifically, the Joint 

Utilities believe that the grid 

connectivity feature of certain large 

volume ERWHs differentiates them from 

the broader ERWH product class and 

warrants a separate classification and 

standard. (Joint Utilities, No. 58 at p. 4) 

The Joint Utilities further argued that 

grid-interactive water heaters are clearly 

distinguishable from water heaters that 

are not responsive to grid signals, and 

proposed a definition (discussed below) 

that would distinguish those products 

from other water heaters. The Joint 

Utilities also stated that grid-interactive 

water heaters provide uninterrupted hot 

water to consumers, large amounts of 

energy storage during times when there 

is an excess of unused, available 

renewable energy, the ability to reduce 

load on the grid to enhance reliability or 

reduce congestion on the transmission 

grid, and reliability services in the form 

of frequency regulation or other grid 

ancillary services, all of which make 

this specific group of water heaters 

different from the general class of 

electric water heaters, and thus 

deserving of a new classification 

pursuant to Section 6295 (o)(2)(A). 

(Joint Utilities, No. 58 at p. 17) 

The Joint Utilities proposed that a 

‘‘Grid-Interactive Water Heater’’ be 

defined as a separate product class 

consisting of products with the 

following characteristics: (1) A storage 


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tank greater than 55 gallons; (2) a 

control device capable of receiving 

communication from a grid operator, 

electric utility, or other energy services 

company that provides real-time control 

of the heating element; (3) evidence that 

the appliance owner is enrolled in a grid 

operator, electric utility, or other energy 

services company program to provide 

demand response or related interactive 

electric grid services; (4) a thermostatic 

mixing valve if the water heater is 

capable of heating water greater than 

120 degrees Fahrenheit. (Joint Utilities, 

No. 58 at pp. 17–18) 

Further, the Joint Utilities 

supplemental comment suggested that if 

‘‘grid interactive water heaters’’ were 

established as a separate product class 

and required ongoing reporting from 

utilities in order to track manufacturer 

sales versus utility installations, this 

should be done through the addition of 

a single question onto the Energy 

Information Administration (EIA) forms 

EIA–861 and EIA–861S in order to 

minimize burdens on utilities and DOE/ 

EIA. The Joint Utility commenters 

proposed adding the following question: 

‘‘If you have a demand side 

management (DSM) program for gridinteractive water heaters (as defined by 

DOE), how many grid-interactive water 

heaters were added to your program 

this/last year?’’ The Joint Utilities 

commented that the information 

collected by EIA could be made 

available to DOE for tracking purposes. 

(Joint Utilities Supplemental, No. 156 at 

pp. 1–2) 

Rheem commented on the four 

criteria of the proposed product class for 

‘‘grid-interactive water heater.’’ Rheem 

expressed support for the first 

requirement proposed by the Joint 

Utilities in the definition of ‘‘gridinteractive water heater’’ requiring such 

water heaters to have a storage volume 

of greater than 55 gallons, but noted this 

requirement may have a limiting effect 

on the potential application and 

associated benefits in the field. Rheem 

also supported the second criterion 

proposed by the Joint Utilities that a 

control device must be present with the 

understanding that these control devices 

are provided in the field by the utility 

to the consumer in support of their ETS 

program, giving the utility the ability to 

turn the water heater on or off. Rheem 

also agreed with the third criterion 

proposed by utilities (i.e., agreement to 

be enrolled in a grid operator, electric 

utility, or other energy services 

company program to provide demand 

response or other electric grid services) 

with the additional clarification that the 

agreement is a contractual arrangement 

between utility and consumer, not part 

of a product definition. Lastly, Rheem 

did not support the requirement of a 

mixing valve at 120 °F, noting that 

almost all ERWHs can be adjusted to 

heat water to 170 °F and most if not all 

manufacturers encourage use of a 

mixing valve. Rheem stated that 

requiring a mixing valve at 120 °F for 

this product class only would be 

inconsistent given that other product 

classes and the majority of residential 

electric storage water heaters do not 

require such a device. (Rheem, No. 86 

at p. 3) 

AO Smith also commented on the 

four criteria for defining a ‘‘gridinteractive water heater’’ product class, 

as proposed by the Joint Utilities. AO 

Smith supported the first and third 

criteria listed above (i.e., that the water 

heater must have a storage volume 

greater than 55 gallons, and that the 

water heater must be enrolled in a 

utility grid-interactive program). 

However, AO Smith expressed concern 

with the criterion that the unit must be 

equipped with a communicationcapable control device due to the large 

number of different devices currently in 

use with differing operating 

characteristics and communication 

protocols. AO Smith stated that unless 

there was a standardized 

communication protocol and 

operational algorithm, it would be 

difficult for water heater manufacturers 

to justify making a small number of 

water heaters for ETS programs with 

each customer (utility) requiring a 

different control device in an even 

smaller number of heaters. AO Smith 

stated that it would support the 

criterion if it were altered to provide as 

an option that the water heater may be 

without a control device if it has a 

provision for connection to a utilityprovided communication device that 

would interact with the water heater 

control to provide equivalent grid 

communication. Regarding the fourth 

proposed criterion, AO Smith stated 

that it does not object to the inclusion 

of thermostatic mixing valve in the 

definition, but noted that almost all 

ERWHs can be adjusted to 170 °F and 

commented that 120 °F is too low for 

many purposes. AO Smith expressed 

preference for a criteria that specifies 

that since the heater will be heated to 

a high water temperature during offpeak periods, a means (such as a 

thermostatic mixing valve) should be 

provided to adjust the outlet water to 

the desired delivery temperature, which 

in most cases will be less than storage 

temperature. (AO Smith, No. 20 at p. 2) 

Contrary to the Joint Utilities’ and 

manufacturers’ position, the Joint 

Efficiency Advocates stated that a 

separate product class for gridinteractive water heaters is not 

appropriate. (Joint Efficiency Advocates, 

No. 68 at p. 1) The Joint Efficiency 

Advocates stated that given the novelty 

of grid-interactive water heaters, the 

variety of possible applications, and the 

variety of possible product designs and 

features, it would be unclear how to 

meaningfully define such a product 

class to enable the benefits while 

reducing risk and minimizing costs. 

(Joint Efficiency Advocates, No. 68 at p. 

3) The Joint Efficiency Advocates were 

also concerned that there would be a 

significant risk that a new product class 

may be abused as a loophole to bypass 

the efficiency standards, rather than to 

deliver grid benefits. The Joint 

Efficiency Advocates pointed out that 

the benefits remain unquantified and 

generally unassessed, making it 

impossible to consider whether the 

benefits outweigh the risks and costs. 

Lastly, the Joint Efficiency Advocates 

stated that creating a new product class 

would likely run afoul of the ‘‘antibacksliding’’ provision. The Joint 

Efficiency Advocates argued that all 

water heaters, including those that 

include grid interactive controls, are 

now subject to the 2010 standards, 

which prevents DOE from creating a 

new class with lower standards for a 

grid interactive water heater. (Joint 

Efficiency Advocates, No. 68 at p. 3) 

GE also argued against the creation of 

a product class for grid interactive water 

heaters, stating that it is not justified 

under DOE’s criteria for establishing 

product classes since it would not 

preserve a utility that would otherwise 

be eliminated by the standard. (GE, No. 

85 at p. 3) GE stated that even if a 

certain consumer utility is at risk, that 

concern should have been raised during 

the rulemaking when it could have been 

thoroughly evaluated by DOE and all 

interested parties. (GE, No. 85 at p. 3) 

Further, GE commented that grid 

interactive water heaters do not have 

capacity or other performance related 

features that HPWHs do not, or could 

not, have, and opined that creating a 

separate product class would impede 

development of the market for highperforming HPWH products. (GE, No. 85 

at p. 3) GE also argued that DOE is 

prevented under the ‘‘anti-backsliding’’ 

provision at 42 U.S.C. 6295(o)(1) from 

amending the standard to waive its 

requirements as applicable to a subset of 

covered products, especially if doing so 

increases maximum allowable energy 

use or decreases minimum energy 

efficiency. (GE, No. 85 at pp. 4) 

After considering the comments 

regarding the potential for establishing a 

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interactive water heaters’’ as proposed 

by the Joint Utilities, DOE has 

tentatively concluded not to propose 

such an approach. In particular, DOE 

agrees with the Joint Efficiency 

Advocates and GE that under 42 U.S.C. 

6295(o)(1), DOE is prohibited from 

promulgating any standard that 

increases the maximum allowable 

energy use or decreases minimum 

energy efficiency of a covered product. 

The standards established for electric 

water heaters in the April 2010 final 

rule apply to all electric water heaters 

meeting the applicable regulatory 

definitions. Therefore, establishing a 

separate product class for a segment of 

electric storage water heaters and setting 

a lower energy conservation standard 

level than the required energy efficiency 

of such products would be prohibited 

under the ‘‘anti-backsliding’’ provision 

contained in 42 U.S.C. 6295(o)(1). 

Accordingly, DOE has tentatively 

concluded that it will not propose to 

establish a separate product class for 

‘‘grid-interactive’’ water heaters with 

energy conservation standards that are 

less stringent than those promulgated in 

the April 2010 final rule. However, DOE 

does agree with the suggestion by the 

Joint Utilities that the number of water 

heaters in ETS programs should be 

tracked, and that adding a question to 

the EIA–861 and EIA–861S forms are an 

appropriate way to achieve this goal 

while minimizing burdens on all 

parties. DOE’s proposal in this regard is 

discussed further in section 0 below. 

4. Potential for Establishing a Waiver 

Process 

In the June 2012 RFI, DOE also 

requested comment on the potential for 

establishing a waiver process that would 

allow for production of limited number 

of large-volume ERWHs solely for ETS 

programs. Both the joint comment 

received from Joint Efficiency 

Advocates, ACEEE, NRDC, and ASAP, 

and the joint comment received from 

the Northwest Advocates, NEEA, NPCC, 

and BPA, generally supported a waiver 

system. (Joint Efficiency Advocates, No. 

68 at p. 1; Northwest Advocates, No. 89 

at p. 2) Several utility companies also 

indicated that the waiver option could 

potentially be a viable alternative, but 

most of the utility company commenters 

preferred the product class approach 

discussed above. (East River, No. 25 at 

p. 3; Lyon-Lincoln, No. 27 at p. 3; 

Bristol, No. 31 at p. 2; Corn Belt, No. 39 

at p. 3; Otter Tail, No. 44 at p. 5) 

The Joint Efficiency Advocates argued 

that a waiver approach is legal under 42 

U.S.C. 7194(a) and could allow 

manufacturers to produce small 

quantities of large-volume ERWHs and 

sell them directly to utilities that 

operate such programs. (Joint Efficiency 

Advocates, No. 68 at p. 4) The Joint 

Efficiency Advocates stated that a 

waiver program has precedent and cited 

the waivers granted for small-duct, highvelocity central air conditioners from 

the standards for residential central air 

conditioners as an example. The Joint 

Efficiency Advocates stated that a 

waiver system would add flexibility and 

reduce the likelihood of loopholes, and 

would facilitate ongoing creativity and 

dynamism from the utility and 

manufacturing industries, given the 

ability to revisit waiver conditions. The 

Joint Efficiency Advocates argued that a 

waiver system would also encourage 

and facilitate ongoing assessment by 

DOE, industry, and other stakeholders, 

leading to greatly improved 

understanding of the benefits and costs 

of grid-interactive water heaters, and 

form the basis for well-informed future 

decisions of a more permanent nature. 

(Joint Efficiency Advocates, No. 68 at p. 

4) 

The Joint Efficiency Advocates stated 

that any waiver would need to be 

limited to cover units sold to utilities 

that actually have demand response 

programs, and the utilities must be 

required to sell or provide gridinteractive water heaters only to 

customers who agree to participate in 

the demand response program. In 

addition, the Joint Efficiency Advocates 

suggested that any application for 

waiver should have to demonstrate that 

it is impossible to operate a demand 

response program with water heaters 

that meet the standard. The Joint 

Efficiency Advocates also argued that 

waiver applications should be made 

jointly by a manufacturer and a utility. 

(Joint Efficiency Advocates, No. 68 at p. 

4) 

The Northwest Advocates stated that 

prior to determining whether to grant a 

waiver, DOE should determine the net 

economic benefits of such an action. 

(Northwest Advocates, No. 89 at p. 2) 

The Northwest Advocates also stated 

that the mechanism enforcing the 

conditions of any program waiver that 

may be established should be given very 

careful consideration because binding 

new homeowners to agreements made 

by previous homeowners has significant 

legal complications. The commenters 

also noted that the required level of 

program oversight and cost of 

enforcement should be considered. 

(Northwest Advocates, No. 89 at pp. 4– 

5) Similarly, Otter Tail stated that when 

customers move the water heater stays 

with the home, but the new homeowner 

may or may not want to have a 

controlled water heater that is part of an 

ETS program. (Otter Tail, No. 44 at p. 

5) 

The Joint Utilities, Rheem, and AO 

Smith generally opposed the option of 

establishing a waiver process. 

Opposition was primarily due to 

concerns about how distribution would 

be affected if the waiver were to require 

some control or direct distribution from 

a manufacturer to a utility program. AO 

Smith stated that not all water heater 

manufacturers sell directly to utilities, 

meaning the level of control DOE 

assumes the manufacturers possess may 

not exist. (AO Smith, No. 20 at p.3) 

Similarly, Rheem stated that a waiver 

type system concept cannot be managed 

effectively by a manufacturer, since a 

manufacturer has little to no 

distribution control over the intended 

application of its product. (Rheem, No. 

86 at p. 3) Further, AO Smith argued 

that using a waiver system would 

introduce a very high degree of 

uncertainty to the manufacturer (and the 

utility) as to their business planning for 

such water heaters and has the potential 

to slow down the manufacturing process 

if a waiver must be granted each time a 

water heater is to be manufactured. AO 

Smith added that if the intent is to allow 

a ‘‘blanket waiver,’’ DOE should 

establish a standing program instead as 

both actions achieve the same end. (AO 

Smith, No. 20 at p.3) 

The Joint Utilities comment pointed 

out that a number of regulatory 

proceedings at the state level led to 

utilities being required under state 

regulation to terminate programs where 

the utility was active in the sale of an 

appliance to the consumer. (Joint 

Utilities, No. 58 at p. 18) The Joint 

Utilities comment stated that if DOE 

appears to be reinstating utility 

appliance programs, it would be 

running afoul of years of state 

regulations and legislation, which 

would inevitably lead to litigation. 

(Joint Utilities, No. 58 at p. 18) 

As noted above, several utility 

company commenters, while preferring 

the product class approach discussed in 

section III.A.3, indicated that the waiver 

option could potentially be a viable 

solution. (East River, No. 25 at p. 3; 

Lyon-Lincoln, No. 27 at p. 3; Bristol, No. 

31 at p. 2; Corn Belt, No. 39 at p. 3; Otter 

Tail, No. 44 at p. 5) Otter Tail stated that 

although they are open to the concept of 

the waiver option, not all utilities’ 

business models support the business of 

selling appliances and for the most part 

utilities do not compete with other retail 

businesses. (Otter Tail, No. 44 at p. 3) 

Two utilities stated that they sell water 

heaters directly to their participants. 

(Eau Claire, No. 69 at p. 2; Bristol, No. 

31 at p. 2) Dakota Electric commented 


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that after unsuccessfully trying to sell 

small numbers of Rheem ‘‘Marathon’’ 

water heaters, Dakota Electric partnered 

with an independent small business 

water heater distributor that handles all 

of their member-owners’ water heater 

supply needs. Dakota Electric stated that 

returning to small volume sales and the 

associated internal overhead costs, 

delivery and warranty problems would 

drive up the price to member-owners. 

(Dakota Electric, No. 36 at p. 4) 

After considering the comments on 

the waiver process, DOE has tentatively 

concluded that a waiver system would 

achieve DOE’s goal of mitigating the 

impacts of the April 2010 final rule on 

utility ETS programs, while also being 

allowable under EPCA. A waiver 

process will address the concerns raised 

by utility companies and has the added 

benefit of having the potential for 

frequent evaluation. Thus, DOE is 

proposing in this NPRM to establish a 

waiver system for large-volume electric 

storage water heaters. The waiver, if 

granted, would allow, for a one-year 

period, manufacturers to produce 

limited numbers of electric water 

heaters with storage volumes above 55 

gallons exclusively for the purpose of 

installation in residences enrolled in a 

utility company electric thermal storage 

(ETS) program. Parties would be 

allowed to apply for additional one-year 

waivers in subsequent years. The 

proposed criteria and method for 

petitioning for a waiver, and the 

proposed requirements that any granted 

waivers will impose are discussed in 

section 0. 

DOE recognizes the concerns of 

certain stakeholders with regard to the 

establishment of a waiver program. In 

particular, DOE believes that 

manufacturers, the Joint Utilities, and 

other utility companies made 

compelling arguments regarding the 

lack of control of the distribution chain, 

as well as local regulations that may 

prevent certain utilities from selling 

water heaters directly to consumers. For 

these reasons, DOE’s proposed waiver 

program will not include any 

requirements that the manufacturer sell 

directly to the utility, or that the utility 

sell the units covered under waiver 

directly to the consumer. Also, 

recognizing that situations may occur 

where new homeowners move into a 

residence with a grid-interactive water 

heater installed but do not wish to 

participate in an ETS program or where 

a consumer purchases a water heater for 

use an ETS program but later decides 

not to participate, DOE is not including 

in its waiver program any criterion that 

the homeowner have an agreement to be 

enrolled in a utility ETS program. 

Rather, DOE is including other 

requirements to ensure that the waiver 

program is targeted, including an annual 

limit on the number of units to which 

the waiver will apply and a requirement 

that the water heater be shipped with 

the control device that will be used for 

the ETS program. These requirements 

are discussed further in section III.B.2. 

In response to the comment from 

NEEA, NPCC, and BPA stating that DOE 

must consider the economic impacts of 

any waiver that is granted, DOE agrees 

that an economic analysis may provide 

helpful information in determining 

whether to grant a waiver, but also 

believes it may be infeasible to 

individually calculate the economic 

benefits for every waiver request 

received depending on the volume of 

requests. 

B. Waiver Process 

Any waiver process established by 

DOE must include a clear procedure for 

obtaining a waiver, with guidelines for 

circumstances under which the waiver 

will be granted, instructions regarding 

how to apply for and document the 

waiver, and a description of conditions 

that must be met for the waiver to be 

granted. The following sections describe 

the waiver process that DOE proposes to 

establish, including the criteria 

necessary to obtain a waiver, the 

requirements that must be met to 

comply with the waiver, and a process 

for reviewing the waiver to ensure its 

effectiveness in addressing the issue at 

hand. 

1. Criteria for Obtaining a Waiver 

In order to obtain a waiver that would 

allow for the manufacture and sale of 

limited numbers of electric water 

heaters with storage volumes above 55 

gallons for a one year period exclusively 

for the purpose of installation in 

residences enrolled in a utility company 

ETS program, DOE proposes that 

manufacturers and/or utility companies, 

or a utility company and a manufacturer 

jointly, must request such a waiver from 

DOE. Further, the request must come 

from a manufacturer of water heaters 

and/or a utility company that 

administers an electric thermal storage 

program utilizing large-volume electric 

water heaters. No other parties may 

apply for a waiver. If the request is 

made individually by a manufacturer, it 

must identify each of the utility ETS 

programs for which the water heaters 

are intended to participate. Similarly, if 

the request is made by a utility, it must 

identify the manufacturer that would be 

responsible for producing the units. 

To request an exception from the DOE 

energy conservation standards for 

residential water heaters, a 

manufacturer and/or utility company 

must submit a letter to the Assistant 

Secretary for Energy Efficiency and 

Renewable Energy detailing the waiver 

request. Descriptions of how to petition 

for the waiver, the information that 

should be contained in the request, and 

additional requirements that must be 

met if the waiver is granted are 

discussed in section 0. 

2. Requirements and Method for 

Obtaining Waiver 

DOE proposes that, if a manufacturer 

and/or utility company believes that it 

(they) can meet these requirements, in 

order to receive a waiver it (they) must 

first submit a letter to the Assistant 

Secretary for Energy Efficiency and 

Renewable Energy requesting that a 

waiver be granted. The waiver request 

should include the petitioning company 

contact information. If the application is 

filed jointly, it must contain contact 

information for all parties. If not filed 

jointly, the request must contain 

information about any additional entity 

(i.e., manufacturer or utility) that will be 

a party to the waiver. 

Second, the waiver should include 

the model information (manufacturer, 

brand, basic model number, rated 

storage volumes and energy factor for 

each basic model that the manufacturer 

plans to produce and the utility plans to 

use in an ETS program coinciding with 

the DOE certification record). In 

addition, the application must include a 

list of the utility names that administer 

each of the ETS programs for which the 

basic models subject to the waiver 

application will be utilized and the 

specific number of units for each ETS 

program which exemption from the 

standards is requested. The utility 

company that is a party to the request 

must submit information on the current 

stock of ERWHs in their ETS programs 

and any planned expansion of the 

programs that would justify the number 

of units requested to be covered by 

waiver. DOE proposes to limit the 

number of units for which the waiver 

would apply annually to reduce the 

likelihood of significant numbers of 

large-volume ERWHs being used in 

applications without ETS programs. 

The waiver request must also include 

a description of the control device that 

will be used to control any potentially 

waiver-covered water heaters for the 

ETS program. The control device must 

be capable of receiving communication 

from a grid operator, electric utility, or 

other energy services company that 

provides real-time control of the heating 

element. 


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Upon reviewing the application, DOE 

will determine whether to grant the 

waiver. If such determination is 

positive, DOE will specify the 

residential water heater basic model (or 

models) that the waiver applies to and 

the number of units that are covered 

under the waiver, as well as the 

expiration date of that waiver. DOE will 

also specify an alternative minimum 

energy conservation standard that 

would apply to any models covered 

under waiver. DOE will notify the 

petitioner(s) in writing and the public 

through publication of a Federal 

Register notice once a decision is made 

regarding the status of a waiver request. 

DOE proposes the waiver would expire 

one calendar year after it is granted, 

after which time it will not be 

applicable. Consequently, if a 

manufacturer and/or utility company 

would like to continue the waiver for a 

longer period, DOE proposes that a new 

waiver application would need to be 

submitted each year to ensure a 

continued evaluation of the waivers. 

In addition, DOE believes that in 

order to effectively enforce this waiver 

program, DOE must have some means of 

physically distinguishing between water 

heaters for ETS programs and other 

electric resistance water heaters. In 

order to ensure that water heaters 

manufactured under a waiver are 

intended for use in ETS programs and 

encourage their use in ETS programs, 

DOE proposes to require that the units 

for which a waiver is granted are 

shipped from the manufacturer with the 

ETS control device installed on the 

water heater or packaged with the water 

heater. DOE is aware that currently the 

control mechanism is typically provided 

by a third party manufacturer (i.e., a 

manufacturer other than the water 

heater manufacturer) and is often 

installed by the utility company or a 

contractor to the utility company rather 

than the water heater original 

equipment manufacturer. In addition, 

DOE recognizes the concerns stated 

earlier in this document that there are 

a number of different control devices 

available, which may present 

difficulties to water heater 

manufacturers in installing these 

devices at the factory. However, DOE 

believes that without the control device 

being installed at the point of water 

heater manufacture, it would be difficult 

to ensure that the unit is intended for 

use in an ETS program. In order to 

enforce the provisions of the waiver, 

DOE believes that the control device 

must be present on all units subject to 

the waiver when they leave the water 

heater manufacturer, and thus proposes 

to include this requirement as a 

condition of any waivers that may be 

granted under this process. No 

consideration will be given to add-on 

control devices for ETS programs that 

are to be installed in the field as an 

addition to a traditional ERWH. DOE 

requests comment on this proposal, and 

this is identified as issue 1 in section 

V.E, ‘‘Issues on Which DOE Seeks 

Comment.’’ 

In summary, to apply for a waiver, 

DOE proposes that a manufacturer and/ 

or utility must submit a request to DOE 

that includes the following information: 

(1) Contact and company information 

for all parties involved in the waiver 

request (including both the 

manufacturer of the water heaters and 

the utilities administering the ETS 

program); (2) number of units of a given 

basic model broken down by utility for 

which the waiver is requested; (3) 

specific information about the water 

heaters, including manufacturer, brand, 

basic model number, rated storage 

volume, and energy factor; and (4) a 

description of the control device to be 

used on the water heaters and 

documentation of the integration of that 

control device into the water heater 

design if the waiver is granted. If DOE 

grants the waiver, as a condition of the 

waiver, DOE proposes that the covered 

water heaters leave the manufacturer 

with the ETS control device installed on 

the water heater or packaged with the 

water heater. 

3. Periodic Review of Waiver 

Mechanism 

DOE believes that a critical 

component of the waiver process 

proposed in this NPRM will be periodic 

reviews of the waiver mechanism to 

ensure that it is achieving its goals of 

serving its intended purpose while 

limiting the potential for circumvention 

of the April 2010 energy conservation 

standards for products not used in ETS 

programs. Periodic reviews will allow 

DOE to assess any new technologies that 

are available on the market and to 

evaluate whether the concerns of utility 

companies are still valid in light of any 

new information or products on the 

market that may become available. In 

addition, periodic reviews would 

account for any new technologies that 

make products meeting DOE’s energy 

conservation standards appropriate for 

use in ETS programs. 

DOE believes that its proposal that 

each granted waiver will be applicable 

for only one year creates a de facto 

review period. As waivers expire and 

manufacturers and/or utility companies 

must apply for new waivers, DOE will 

re-evaluate any previous decisions made 

under this process. DOE also plans to 

review the waiver process each year. In 

order to conduct these evaluations, DOE 

is proposing to implement the 

suggestion contained in the Joint 

Utilities supplemental comment 

(discussed previously in section 3) that 

a question be added to forms EIA–861 

and EIA–861S that tracks the number of 

models that are actually installed in 

utility ETS applications. (Joint Utilities 

Supplemental, No.156 at p.1) This 

information would allow DOE to 

compare the number of units for which 

a waiver is granted to the number 

actually installed in ETS applications 

each year to ensure that this process 

achieves its goals. DOE proposes to 

include with minor modifications the 

additional question on forms EIA–861 

and EIA–861S suggested by the Joint 

Utilities. Rather than ask how many 

grid-interactive water heaters were 

added to each program this/last year, as 

proposed by the Joint Utilities, DOE 

proposes to include a question that asks 

for the total number of water heaters 

enrolled in a given ETS program. The 

question DOE proposes to add would 

read as follows: ‘‘If you have a demand 

side management (DSM) program for 

electric storage water heaters, how many 

electric storage water heaters with 

storage volumes above 55 gallons were 

utilized in your program this/last year?’’ 

DOE seeks comment on its proposal to 

add this question to forms EIA–861 and 

EIA–861S, and this is identified as issue 

2 in section V.E, ‘‘Issues on Which DOE 

Seeks Comment.’’ 

At the time of each review, DOE can 

update the waiver process, if necessary, 

through a notice and comment 

rulemaking to amend the criteria and 

requirements to comply with the 

waiver. Similarly, if new technologies 

come to market or new information 

comes to light that mitigate the concerns 

raised by utility companies to date (e.g., 

a product that meets DOE minimum 

energy conservation standards and is 

suitable for utility ETS programs), DOE 

could discontinue the granting of 

waivers if justified. 

Procedural Requirements 

A. Review Under Executive Orders 

12866 and 13563 

Section 1(b)(1) of Executive Order 

12866, ‘‘Regulatory Planning and 

Review,’’ 58 FR 51735 (Oct. 4, 1993), 

requires each agency to identify the 

problem that it intends to address, 

including, where applicable, the failures 

of private markets or public institutions 

that warrant new agency action, as well 

as to assess the significance of that 


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problem. The problems that today’s 

standards address are as follows: 

(1) There is a lack of consumer 

information and/or information 

processing capability about energy 

efficiency opportunities in the home 

appliance market. 

(2) There is asymmetric information 

(one party to a transaction has more and 

better information than the other) and/ 

or high transactions costs (costs of 

gathering information and effecting 

exchanges of goods and services). 

(3) There are external benefits 

resulting from improved energy 

efficiency of residential water heaters 

that are not captured by the users of 

such equipment. These benefits include 

externalities related to environmental 

protection and energy security that are 

not reflected in energy prices, such as 

reduced emissions of greenhouse gases. 

In addition, this regulatory action is 

not an ‘‘economically significant 

regulatory action’’ under section 3(f)(1) 

of Executive Order 12866. Accordingly, 

DOE is not required under section 

6(a)(3) of the Executive Order to prepare 

a regulatory impact analysis (RIA) on 

this NPRM and the Office of Information 

and Regulatory Affairs (OIRA) in the 

Office of Management and Budget 

(OMB) is not required to review this 

rule. 

DOE has also reviewed this regulation 

pursuant to Executive Order 13563, 

issued on January 18, 2011 (76 FR 3281, 

Jan. 21, 2011). EO 13563 is 

supplemental to and explicitly reaffirms 

the principles, structures, and 

definitions governing regulatory review 

established in Executive Order 12866. 

To the extent permitted by law, agencies 

are required by Executive Order 13563 

to: (1) Propose or adopt a regulation 

only upon a reasoned determination 

that its benefits justify its costs 

(recognizing that some benefits and 

costs are difficult to quantify); (2) tailor 

regulations to impose the least burden 

on society, consistent with obtaining 

regulatory objectives, taking into 

account, among other things, and to the 

extent practicable, the costs of 

cumulative regulations; (3) select, in 

choosing among alternative regulatory 

approaches, those approaches that 

maximize net benefits (including 

potential economic, environmental, 

public health and safety, and other 

advantages; distributive impacts; and 

equity); (4) to the extent feasible, specify 

performance objectives, rather than 

specifying the behavior or manner of 

compliance that regulated entities must 

adopt; and (5) identify and assess 

available alternatives to direct 

regulation, including providing 

economic incentives to encourage the 

desired behavior, such as user fees or 

marketable permits, or providing 

information upon which choices can be 

made by the public. 

DOE emphasizes as well that 

Executive Order 13563 requires agencies 

to use the best available techniques to 

quantify anticipated present and future 

benefits and costs as accurately as 

possible. In its guidance, the Office of 

Information and Regulatory Affairs has 

emphasized that such techniques may 

include identifying changing future 

compliance costs that might result from 

technological innovation or anticipated 

behavioral changes. For the reasons 

stated in the preamble, DOE believes 

that this NPRM is consistent with these 

principles, including the requirement 

that, to the extent permitted by law, 

benefits justify costs and that net 

benefits are maximized. 

B. Review Under the Regulatory 

Flexibility Act 

The Regulatory Flexibility Act (5 

U.S.C. 601 et seq.) requires preparation 

of a regulatory flexibility analysis for 

any rule that by law must be proposed 

for public comment, unless the agency 

certifies that the rule, if promulgated, 

will not have a significant economic 

impact on a substantial number of small 

entities. As required by Executive Order 

13272, ‘‘Proper Consideration of Small 

Entities in Agency Rulemaking,’’ 67 FR 

53461 (August 16, 2002), DOE 

published procedures and policies on 

February 19, 2003, to ensure that the 

potential impacts of its rules on small 

entities are properly considered during 

the rulemaking process. 68 FR 7990. 

DOE has made its procedures and 

policies available on the Office of the 

General Counsel’s Web site (http:// 

energy.gov/gc/office-general-counsel). 

In this notice, DOE is not proposing 

to amend the existing energy 

conservation standards for residential 

water heaters to adopt more stringent 

levels, but rather is proposing a waiver 

process that would allow, for a one-year 

period, manufacturers to produce 

limited numbers of electric water 

heaters with storage volumes above 55 

gallons exclusively for the purpose of 

installation in residences enrolled in a 

utility company electric thermal storage 

(ETS) program. 

For manufacturers of residential water 

heaters, the Small Business 

Administration (SBA) has set a size 

threshold, which defines those entities 

classified as ‘‘small businesses’’ for the 

purposes of the statute. DOE used the 

SBA’s small business size standards to 

determine whether any small entities 

would be subject to the requirements of 

the rule. 13 CFR part 121.The size 

standards are listed by North American 

Industry Classification System (NAICS) 

code and industry description and are 

available at http://www.sba.gov/sites/ 

default/files/files/ 

Size_Standards_Table.pdf. Residential 

water heater manufacturing is classified 

under NAICS 335228—‘‘Other Major 

Household Appliance Manufacturing.’’ 

The SBA sets a threshold of 500 

employees or less for an entity to be 

considered as a small business for this 

category. DOE has identified one small 

business manufacturer of electric 

storage water heaters. 

DOE does not expect that this 

proposed rule, if adopted, would have a 

significant impact on any small business 

manufacturers. The proposed waiver 

process does impose several 

requirements, including that 

manufacturers may have to apply for the 

waiver (unless they are part of a joint 

application in which a utility company 

is submitting the application), and will 

be responsible for ensuring that the 

control device is installed on any water 

heaters that are manufactured under a 

waiver. DOE expects the impact of both 

of these requirements to be minimal for 

all manufacturers. In addition, DOE 

believes it is reasonable to assume that 

because the waiver process is optional, 

these potential benefits outweigh the 

small burdens of obtaining a waiver, as 

manufacturers would otherwise not opt 

to participate in the waiver process. 

Thus, DOE certifies that waiver process 

set forth in this proposed rule, if 

promulgated, would not have a 

significant economic impact on a 

substantial number of small entities. 

Accordingly, DOE has not prepared a 

regulatory flexibility analysis for this 

rulemaking. DOE will transmit the 

certification and supporting statement 

of factual basis to the Chief Counsel for 

Advocacy of the Small Business 

Administration for review under 5 

U.S.C. 605(b). 

DOE requests comment on its above 

conclusions, as well as any information 

concerning small businesses that could 

be impacted by this rulemaking and the 

nature and extent of those potential 

impacts of the proposed waiver process 

on small residential water heater 

manufacturers. This is identified as 

issue 3 in section V.E, ‘‘Issues on Which 

DOE Seeks Comment.’’ 

C. Review Under the Paperwork 

Reduction Act 

Manufacturers of residential water 

heaters must certify to DOE that their 

products comply with any applicable 

energy conservation standards. In 

certifying compliance, manufacturers 

must test their products according to the 


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DOE test procedures for residential 

water heaters, including any 

amendments adopted for those test 

procedures. DOE has established 

regulations for the certification and 

recordkeeping requirements for all 

covered consumer products and 

commercial equipment, including 

residential water heaters. 76 FR 12422 

(March 7, 2011). The collection-ofinformation requirement for the 

certification and recordkeeping is 

subject to review and approval by OMB 

under the Paperwork Reduction Act 

(PRA). Public reporting burden for the 

certification is estimated to average 4 

hours per response, including the time 

for reviewing instructions, searching 

existing data sources, gathering and 

maintaining the data needed, and 

completing and reviewing the collection 

of information. 

Notwithstanding any other provision 

of the law, no person is required to 

respond to, nor shall any person be 

subject to a penalty for failure to comply 

with, a collection of information subject 

to the requirements of the PRA, unless 

that collection of information displays a 

currently valid OMB Control Number. 

D. Review Under the National 

Environmental Policy Act of 1969 

Pursuant to the National 

Environmental Policy Act (NEPA) of 

1969, DOE has determined that the 

proposed rule fits within the category of 

actions included in Categorical 

Exclusion (CX) B5.1 and otherwise 

meets the requirements for application 

of a CX. See 10 CFR Part 1021, App. B, 

B5.1(b); 1021.410(b) and Appendix B, 

B(1)–(5). The proposed rule fits within 

the category of actions because it is a 

rulemaking that establishes a waiver 

process that would allow, for a one-year 

period, manufacturers to produce 

limited numbers of electric water 

heaters with storage volumes above 55 

gallons exclusively for the purpose of 

installation in residences enrolled in a 

utility company electric thermal storage 

(ETS) program. DOE has determined 

that none of the exceptions identified in 

CX B5.1(b) apply. Therefore, DOE has 

made a CX determination for this 

rulemaking, and DOE does not need to 

prepare an Environmental Assessment 

or Environmental Impact Statement for 

this proposed rule. DOE’s CX 

determination for this proposed rule is 

available at http://cxnepa.energy.gov/. 

E. Review Under Executive Order 13132 

Executive Order 13132, ‘‘Federalism.’’ 

64 FR 43255 (Aug. 10, 1999) imposes 

certain requirements on Federal 

agencies formulating and implementing 

policies or regulations that preempt 

State law or that have Federalism 

implications. The Executive Order 

requires agencies to examine the 

constitutional and statutory authority 

supporting any action that would limit 

the policymaking discretion of the 

States and to carefully assess the 

necessity for such actions. The 

Executive Order also requires agencies 

to have an accountable process to 

ensure meaningful and timely input by 

State and local officials in the 

development of regulatory policies that 

have Federalism implications. On 

March 14, 2000, DOE published a 

statement of policy describing the 

intergovernmental consultation process 

it will follow in the development of 

such regulations. 65 FR 13735. EPCA 

governs and prescribes Federal 

preemption of State regulations as to 

energy conservation for the products 

that are the subject of this proposed 

rule. States can petition DOE for 

exemption from such preemption to the 

extent, and based on criteria, set forth in 

EPCA. (42 U.S.C. 6297) No further 

action is required by Executive Order 

13132. 

F. Review Under Executive Order 12988 

With respect to the review of existing 

regulations and the promulgation of 

new regulations, section 3(a) of 

Executive Order 12988, ‘‘Civil Justice 

Reform,’’ imposes on Federal agencies 

the general duty to adhere to the 

following requirements: (1) Eliminate 

drafting errors and ambiguity; (2) write 

regulations to minimize litigation; and 

(3) provide a clear legal standard for 

affected conduct rather than a general 

standard and promote simplification 

and burden reduction. 61 FR 4729 (Feb. 

7, 1996). Section 3(b) of Executive Order 

12988 specifically requires that 

Executive agencies make every 

reasonable effort to ensure that the 

regulation: (1) Clearly specifies the 

preemptive effect, if any; (2) clearly 

specifies any effect on existing Federal 

law or regulation; (3) provides a clear 

legal standard for affected conduct 

while promoting simplification and 

burden reduction; (4) specifies the 

retroactive effect, if any; (5) adequately 

defines key terms; and (6) addresses 

other important issues affecting clarity 

and general draftsmanship under any 

guidelines issued by the Attorney 

General. Section 3(c) of Executive Order 

12988 requires Executive agencies to 

review regulations in light of applicable 

standards in section 3(a) and section 

3(b) to determine whether they are met 

or it is unreasonable to meet one or 

more of them. DOE has completed the 

required review and determined that, to 

the extent permitted by law, this 

proposed rule meets the relevant 

standards of Executive Order 12988. 

G. Review Under the Unfunded 

Mandates Reform Act of 1995 

Title II of the Unfunded Mandates 

Reform Act of 1995 (UMRA) requires 

each Federal agency to assess the effects 

of Federal regulatory actions on State, 

local, and Tribal governments and the 

private sector. Public Law 104–4, sec. 

201 (codified at 2 U.S.C. 1531). For a 

proposed regulatory action likely to 

result in a rule that may cause the 

expenditure by State, local, and Tribal 

governments, in the aggregate, or by the 

private sector of $100 million or more 

in any one year (adjusted annually for 

inflation), section 202 of UMRA requires 

a Federal agency to publish a written 

statement that estimates the resulting 

costs, benefits, and other effects on the 

national economy. (2 U.S.C. 1532(a), (b)) 

The UMRA also requires a Federal 

agency to develop an effective process 

to permit timely input by elected 

officers of State, local, and Tribal 

governments on a proposed ‘‘significant 

intergovernmental mandate,’’ and 

requires an agency plan for giving notice 

and opportunity for timely input to 

potentially affected small governments 

before establishing any requirements 

that might significantly or uniquely 

affect small governments. On March 18, 

1997, DOE published a statement of 

policy on its process for 

intergovernmental consultation under 

UMRA. 62 FR 12820. DOE’s policy 

statement is also available at http:// 

energy.gov/gc/office-general-counsel. 

This proposed rule does not contain 

a Federal intergovernmental mandate, 

and it will not require expenditures of 

$100 million or more by State, local, 

and Tribal governments, in the 

aggregate, or by the private sector. 

Accordingly, no further action is 

required under the UMRA. 

H. Review Under the Treasury and 

General Government Appropriations 

Act, 1999 

Section 654 of the Treasury and 

General Government Appropriations 

Act, 1999 (Pub. L. 105–277) requires 

Federal agencies to issue a Family 

Policymaking Assessment for any rule 

that may affect family well-being. This 

rule would not have any impact on the 

autonomy or integrity of the family as 

an institution. Accordingly, DOE has 

concluded that it is not necessary to 

prepare a Family Policymaking 

Assessment. 

I. Review Under Executive Order 12630 

DOE has determined, under Executive 

Order 12630, ‘‘Governmental Actions 


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and Interference with Constitutionally 

Protected Property Rights’’ 53 FR 8859 

(Mar. 18, 1988), that this regulation 

would not result in any takings that 

might require compensation under the 

Fifth Amendment to the U.S. 

Constitution. 

J. Review Under the Treasury and 

General Government Appropriations 

Act, 2001 

Section 515 of the Treasury and 

General Government Appropriations 

Act, 2001 (44 U.S.C. 3516, note) 

provides for Federal agencies to review 

most disseminations of information to 

the public under guidelines established 

by each agency pursuant to general 

guidelines issued by OMB. OMB’s 

guidelines were published at 67 FR 

8452 (Feb. 22, 2002), and DOE’s 

guidelines were published at 67 FR 

62446 (Oct. 7, 2002). DOE has reviewed 

this NPRM under the OMB and DOE 

guidelines and has concluded that it is 

consistent with applicable policies in 

those guidelines. 

K. Review Under Executive Order 13211 

Executive Order 13211, ‘‘Actions 

Concerning Regulations That 

Significantly Affect Energy Supply, 

Distribution, or Use’’ 66 FR 28355 (May 

22, 2001), requires Federal agencies to 

prepare and submit to OIRA at OMB, a 

Statement of Energy Effects for any 

proposed significant energy action. A 

‘‘significant energy action’’ is defined as 

any action by an agency that 

promulgates or is expected to lead to 

promulgation of a final rule, and that: 

(1) Is a significant regulatory action 

under Executive Order 12866, or any 

successor order; and (2) is likely to have 

a significant adverse effect on the 

supply, distribution, or use of energy, or 

(3) is designated by the Administrator of 

OIRA as a significant energy action. For 

any proposed significant energy action, 

the agency must give a detailed 

statement of any adverse effects on 

energy supply, distribution, or use 

should the proposal be implemented, 

and of reasonable alternatives to the 

action and their expected benefits on 

energy supply, distribution, and use. 

DOE has tentatively concluded that 

this regulatory action, which sets forth 

a waiver process for energy conservation 

standards for residential water heaters, 

is not a significant energy action 

because the proposed waiver process is 

not likely to have a significant adverse 

effect on the supply, distribution, or use 

of energy, nor has it been designated as 

such by the Administrator at OIRA. 

Accordingly, DOE has not prepared a 

Statement of Energy Effects on the 

proposed rule. 

L. Review Under the Information 

Quality Bulletin for Peer Review 

On December 16, 2004, OMB, in 

consultation with the Office of Science 

and Technology Policy (OSTP), issued 

its Final Information Quality Bulletin 

for Peer Review (the Bulletin). 70 FR 

2664 (Jan. 14, 2005). The Bulletin 

establishes that certain scientific 

information shall be peer reviewed by 

qualified specialists before it is 

disseminated by the Federal 

Government, including influential 

scientific information related to agency 

regulatory actions. The purpose of the 

bulletin is to enhance the quality and 

credibility of the Government’s 

scientific information. Under the 

Bulletin, the energy conservation 

standards rulemaking analyses are 

‘‘influential scientific information,’’ 

which the Bulletin defines as scientific 

information the agency reasonably can 

determine will have, or does have, a 

clear and substantial impact on 

important public policies or private 

sector decisions. 70 FR 2667. 

In response to OMB’s Bulletin, DOE 

conducted formal in-progress peer 

reviews of the energy conservation 

standards development process and 

analyses and has prepared a Peer 

Review Report pertaining to the energy 

conservation standards rulemaking 

analyses. Generation of this report 

involved a rigorous, formal, and 

documented evaluation using objective 

criteria and qualified and independent 

reviewers to make a judgment as to the 

technical/scientific/business merit, the 

actual or anticipated results, and the 

productivity and management 

effectiveness of programs and/or 

projects. The ‘‘Energy Conservation 

Standards Rulemaking Peer Review 

Report’’ dated February 2007 has been 

disseminated and is available at the 

following Web site: 

www1.eere.energy.gov/buildings/ 

appliance_standards/peer_review.html. 

Public Participation 

A. Attendance at the Public Meeting 

The time, date, and location of the 

public meeting are listed in the DATES

and ADDRESSES sections at the beginning 

of this notice. If you plan to attend the 

public meeting, please notify Ms. 

Brenda Edwards at (202) 586–2945 or 

Brenda.Edwards@ee.doe.gov. As 

explained in the ADDRESSES section, 

foreign nationals visiting DOE 

Headquarters are subject to advance 

security screening procedures. Any 

foreign national wishing to participate 

in the meeting should advise DOE of 

this fact as soon as possible by 

contacting Ms. Brenda Edwards to 

initiate the necessary procedures. 

In addition, you can attend the public 

meeting via webinar. Webinar 

registration information, participant 

instructions, and information about the 

capabilities available to webinar 

participants will be published on DOE’s 

Web site at: http:// 

www1.eere.energy.gov/buildings/ 

appliance_standards/residential/ 

waterheaters.html. Participants are 

responsible for ensuring their systems 

are compatible with the webinar 

software. 

B. Procedure for Submitting Requests To 

Speak and Prepared General Statements 

for Distribution 

Any person who has an interest in the 

topics addressed in this notice, or who 

is representative of a group or class of 

persons that has an interest in these 

issues, may request an opportunity to 

make an oral presentation at the public 

meeting. Such persons may handdeliver requests to speak to the address 

shown in the ADDRESSES section at the 

beginning of this notice between 9:00 

a.m. and 4:00 p.m., Monday through 

Friday, except Federal holidays. 

Requests may also be sent by mail or 

email to: Ms. Brenda Edwards, U.S. 

Department of Energy, Building 

Technologies Program, Mailstop EE–2J, 

1000 Independence Avenue SW., 

Washington, DC 20585–0121, or 

Brenda.Edwards@ee.doe.gov. Persons 

who wish to speak should include with 

their request a computer diskette or CD– 

ROM in WordPerfect, Microsoft Word, 

PDF, or text (ASCII) file format that 

briefly describes the nature of their 

interest in this rulemaking and the 

topics they wish to discuss. Such 

persons should also provide a daytime 

telephone number where they can be 

reached. 

DOE requests persons scheduled to 

make an oral presentation to submit an 

advance copy of their statements at least 

one week before the public meeting. 

DOE may permit persons who cannot 

supply an advance copy of their 

statement to participate, if those persons 

have made advance alternative 

arrangements with the Building 

Technologies Program. As necessary, 

requests to give an oral presentation 

should ask for such alternative 

arrangements. 

C. Conduct of the Public Meeting 

DOE will designate a DOE official to 

preside at the public meeting and may 

also use a professional facilitator to aid 

discussion. The meeting will not be a 

judicial or evidentiary-type public 

hearing, but DOE will conduct it in 


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12986 Federal Register / Vol. 78, No. 38 / Tuesday, February 26, 2013 / Proposed Rules 

accordance with section 336 of EPCA 

(42 U.S.C. 6306). A court reporter will 

be present to record the proceedings and 

prepare a transcript. DOE reserves the 

right to schedule the order of 

presentations and to establish the 

procedures governing the conduct of the 

public meeting. There shall not be 

discussion of proprietary information, 

costs or prices, market share, or other 

commercial matters regulated by U.S. 

anti-trust laws. After the public meeting, 

interested parties may submit further 

comments on the proceedings as well as 

on any aspect of the rulemaking until 

the end of the comment period. 

The public meeting will be conducted 

in an informal, conference style. DOE 

will present summaries of comments 

received before the public meeting, 

allow time for prepared general 

statements by participants, and 

encourage all interested parties to share 

their views on issues affecting this 

rulemaking. Each participant will be 

allowed to make a general statement 

(within time limits determined by DOE), 

before the discussion of specific topics. 

DOE will allow, as time permits, other 

participants to comment briefly on any 

general statements. 

At the end of all prepared statements 

on a topic, DOE will permit participants 

to clarify their statements briefly and 

comment on statements made by others. 

Participants should be prepared to 

answer questions by DOE and by other 

participants concerning these issues. 

DOE representatives may also ask 

questions of participants concerning 

other matters relevant to this 

rulemaking. The official conducting the 

public meeting will accept additional 

comments or questions from those 

attending, as time permits. The 

presiding official will announce any 

further procedural rules or modification 

of the above procedures that may be 

needed for the proper conduct of the 

public meeting. 

A transcript of the public meeting will 

be included in the docket, which can be 

viewed as described in the Docket 

section at the beginning of this NPRM 

and will be accessible on the DOE Web 

site. In addition, any person may buy a 

copy of the transcript from the 

transcribing reporter. 

D. Submission of Comments 

DOE will accept comments, data, and 

information regarding this proposed 

rule before or after the public meeting, 

but no later than the date provided in 

the DATES section at the beginning of 

this proposed rule. Interested parties 

may submit comments, data, and other 

information using any of the methods 

described in the ADDRESSES section at 

the beginning of this NPRM. 

Submitting comments via 

regulations.gov. The regulations.gov 

web page will require you to provide 

your name and contact information. 

Your contact information will be 

viewable to DOE Building Technologies 

staff only. Your contact information will 

not be publicly viewable except for your 

first and last names, organization name 

(if any), and submitter representative 

name (if any). If your comment is not 

processed properly because of technical 

difficulties, DOE will use this 

information to contact you. If DOE 

cannot read your comment due to 

technical difficulties and cannot contact 

you for clarification, DOE may not be 

able to consider your comment. 

However, your contact information 

will be publicly viewable if you include 

it in the comment itself or in any 

documents attached to your comment. 

Any information that you do not want 

to be publicly viewable should not be 

included in your comment, nor in any 

document attached to your comment. 

Otherwise, persons viewing comments 

will see only first and last names, 

organization names, correspondence 

containing comments, and any 

documents submitted with the 

comments. 

Do not submit to regulations.gov 

information for which disclosure is 

restricted by statute, such as trade 

secrets and commercial or financial 

information (hereinafter referred to as 

Confidential Business Information 

(CBI)). Comments submitted through 

regulations.gov cannot be claimed as 

CBI. Comments received through the 

Web site will waive any CBI claims for 

the information submitted. For 

information on submitting CBI, see the 

Confidential Business Information 

section below. 

DOE processes submissions made 

through regulations.gov before posting. 

Normally, comments will be posted 

within a few days of being submitted. 

However, if large volumes of comments 

are being processed simultaneously, 

your comment may not be viewable for 

up to several weeks. Please keep the 

comment tracking number that 

regulations.gov provides after you have 

successfully uploaded your comment. 

Submitting comments via email, hand 

delivery/courier, or mail. Comments and 

documents submitted via email, hand 

delivery, or mail also will be posted to 

regulations.gov. If you do not want your 

personal contact information to be 

publicly viewable, do not include it in 

your comment or any accompanying 

documents. Instead, provide your 

contact information in a cover letter. 

Include your first and last names, email 

address, telephone number, and 

optional mailing address. The cover 

letter will not be publicly viewable as 

long as it does not include any 

comments 

Include contact information each time 

you submit comments, data, documents, 

and other information to DOE. If you 

submit via mail or hand delivery/ 

courier, please provide all items on a 

CD, if feasible, in which case it is not 

necessary to submit printed copies. No 

telefacsimiles (faxes) will be accepted. 

Comments, data, and other 

information submitted to DOE 

electronically should be provided in 

PDF (preferred), Microsoft Word or 

Excel, WordPerfect, or text (ASCII) file 

format. Provide documents that are not 

secured, that are written in English, and 

that are free of any defects or viruses. 

Documents should not contain special 

characters or any form of encryption 

and, if possible, they should carry the 

electronic signature of the author. 

Campaign form letters. Please submit 

campaign form letters by the originating 

organization in batches of between 50 to 

500 form letters per PDF or as one form 

letter with a list of supporters’ names 

compiled into one or more PDFs. This 

reduces comment processing and 

posting time. 

Confidential Business Information. 

Pursuant to 10 CFR 1004.11, any person 

submitting information that he or she 

believes to be confidential and exempt 

by law from public disclosure should 

submit via email, postal mail, or hand 

delivery/courier two well-marked 

copies: one copy of the document 

marked confidential including all the 

information believed to be confidential, 

and one copy of the document marked 

non-confidential with the information 

believed to be confidential deleted. 

Submit these documents via email or on 

a CD, if feasible. DOE will make its own 

determination about the confidential 

status of the information and treat it 

according to its determination. 

Factors of interest to DOE when 

evaluating requests to treat submitted 

information as confidential include: (1) 

A description of the items; (2) whether 

and why such items are customarily 

treated as confidential within the 

industry; (3) whether the information is 

generally known by or available from 

other sources; (4) whether the 

information has previously been made 

available to others without obligation 

concerning its confidentiality; (5) an 

explanation of the competitive injury to 

the submitting person which would 

result from public disclosure; (6) when 

such information might lose its 

confidential character due to the 


wreier-aviles on DSK5TPTVN1PROD with PROPOSALS
Federal Register / Vol. 78, No. 38 / Tuesday, February 26, 2013 / Proposed Rules 12987 

passage of time; and (7) why disclosure 

of the information would be contrary to 

the public interest. 

It is DOE’s policy that all comments 

may be included in the public docket, 

without change and as received, 

including any personal information 

provided in the comments (except 

information deemed to be exempt from 

public disclosure). 

E. Issues on Which DOE Seeks Comment 

Although DOE welcomes comments 

on any aspect of this proposal, DOE is 

particularly interested in receiving 

comments and views of interested 

parties concerning the following issues: 

1. DOE’s proposal to require that the 

units for which a waiver is granted are 

shipped from the manufacturer with the 

ETS control device installed on the 

water heater. 

2. DOE’s proposal to add a question 

to forms EIA–861 and EIA–861S that 

would read as follows: ‘‘If you have a 

demand side management (DSM) 

program for electric storage water 

heaters, how many electric storage water 

heaters with storage volumes above 55 

gallons were utilized in your program 

this/last year?’’ 

3. DOE’s conclusion that the proposed 

waiver process will not have significant 

adverse impacts on a substantial 

number of small business 

manufacturers. DOE also seeks any 

information concerning small 

businesses that could be impacted by 

this rulemaking and the nature and 

extent of those potential impacts of the 

proposed waiver process on small 

residential water heater manufacturers. 

Approval of the Office of the Secretary 

The Secretary of Energy has approved 

publication of this notice of proposed 

rulemaking. 

List of Subjects in 10 CFR Part 430 

Administrative practice and 

procedure, Confidential business 

information, Energy conservation, 

Household appliances, Imports, 

Intergovernmental relations, Reporting 

and recordkeeping requirements, and 

Small businesses. 

Issued in Washington, DC, on February 15, 

2013. 

David T. Danielson, 

Assistant Secretary, Energy Efficiency and 

Renewable Energy. 

■ For the reasons set forth in the 

preamble, DOE proposes to amend part 

430 of chapter II, subchapter D, of title 

10 of the Code of Federal Regulations, 

as set forth below: 

PART 430—ENERGY CONSERVATION 

PROGRAM FOR CONSUMER 

PRODUCTS 

■ 1. The authority citation for part 430 

continues to read as follows: 

Authority: 42 U.S.C. 6291–6309; 28 U.S.C. 

2461 note. 

■ 2. Add § 430.36 to read as follows: 

§ 430.36 Petitions for waiver for electric 

water heaters used in electric thermal 

storage programs. 

(a) Any manufacturer of residential 

water heaters or utility company that 

administers an electric thermal storage 

program for electric water heaters, or 

combination of these two, may submit a 

petition to allow, for a one-year period, 

manufacturers to produce limited 

numbers of electric water heaters with 

rated storage volumes above 55 gallons 

exclusively for the purpose of 

installation in residences enrolled in a 

utility company electric thermal storage 

(ETS) program. 

(b) A petition for waiver shall be 

submitted to the Assistant Secretary for 

Energy Efficiency and Renewable 

Energy, United States Department of 

Energy by email. Each petition for 

waiver shall: 

(1) Identify the company or 

companies, whether manufacturer or 

utility company or combination of the 

two, requesting the waiver, and provide 

contact information (i.e., name of 

company official, address for the 

applicant, phone number, and email 

address) for those entities. Note, if the 

manufacturer is applying for the waiver, 

it should include a list of all utility 

companies administering the ETS 

programs to which it plans to sell the 

basic models. If the utility is applying 

for the waiver, the utility should 

include a list of all of the manufacturers 

from which it plans to purchase electric 

water heaters with rated storage 

volumes above 55 gallons exclusively 

for the purpose of installation in 

residences enrolled in a utility company 

electric thermal storage (ETS) program. 

(2) Identify the particular 

manufacturer, brand, basic model(s), 

rated storage volume, and energy factor 

for which a waiver is requested. 

(3) Identify the number of units per 

utility program on an annual basis for 

each of the basic models for which a 

waiver is requested (i.e., total number of 

units per year of a given basic model 

that will be participating in an ETS 

program for a specific utility). 

(4) Provide information from the 

utility company regarding the current 

stock of electric water heaters used in 

the electric thermal storage programs at 

the time the waiver is submitted and 

any planned expansion of the programs 

for the annual period the waiver will 

cover that would justify the number of 

units requested to be covered by waiver. 

(5) Identify and describe the control 

device that will be installed on the unit. 

The control device must be capable of 

receiving communication from a grid 

operator, electric utility, or other energy 

services company that provides realtime control of the heating element. 

Provide documentation that the control 

device is integrated into the water 

heater design at the point of 

manufacture, including but not limited 

to any marketing and labeling material 

from the manufacturer describing the 

basic model(s) for which the waiver is 

requested. 

(6) Be signed by a company official. 

In accordance with the provisions set 

forth in 10 CFR 1004.11, any request for 

confidential treatment of any 

information contained in a petition for 

waiver or in supporting documentation 

must be accompanied by a copy of the 

petition, application or supporting 

documentation from which the 

information claimed to be confidential 

has been deleted. DOE shall publish in 

the Federal Register the petition and 

supporting documents from which 

confidential information, as determined 

by DOE, has been deleted in accordance 

with 10 CFR 1004.11. 

(c) The Assistant Secretary for Energy 

Efficiency and Renewable Energy shall 

issue a decision on the petition as soon 

as is practicable following receipt and 

review of the petition for waiver and 

other applicable documents. The 

Assistant Secretary for Energy Efficiency 

and Renewable Energy will grant a 

waiver upon determining that the basic 

model for which the waiver was 

requested is particularly well suited for 

use in the electric thermal storage 

program, the requester or combination 

of requesters is an appropriate party to 

be granted such a waiver, the quantity 

of units to be manufactured under the 

waiver is sufficiently limited, and that 

an appropriate control device will be 

present on any water heaters 

manufactured and shipped pursuant to 

a waiver. Manufacture of units 

authorized by a waiver granted under 

this section will not constitute 

violations of an applicable energy 

conservation standard, provided that the 

units are distributed and installed in 

accordance with the terms of the waiver. 

(d) Any granted waiver will specify 

the manufacturer, utilities, brand, basic 

model number, number of units of a 

particular basic model and the 

applicable energy conservation standard 

for units authorized by the waiver. Any 


wreier-aviles on DSK5TPTVN1PROD with PROPOSALS
12988 Federal Register / Vol. 78, No. 38 / Tuesday, February 26, 2013 / Proposed Rules 

granted waiver will terminate 365 days 

after issuance. 

(e) Any basic model for which a 

waiver has been granted shall be 

shipped from the water heater original 

equipment manufacturer with a control 

device that is compatible with the 

utility company administered electric 

thermal storage program. Any changes 

to the basic model design which results 

in the unit consuming more energy or 

alters the control device from which the 

waiver was granted shall require a new 

waiver application. The control device 

must be installed on the water heater 

before it leaves the original equipment 

manufacturer. The control device must 

be capable of receiving communication 

from a grid operator, electric utility, or 

other energy services company that 

provides real-time control of the heating 

element. The water heater must be 

clearly labeled and marketed for use 

exclusively in ETS programs, including 

a description of the control device 

integrated into the water heater, before 

it leaves the original equipment 

manufacturer. 

[FR Doc. 2013–04099 Filed 2–25–13; 8:45 am] 

BILLING CODE 6450–01–P 

DEPARTMENT OF TRANSPORTATION 

Federal Aviation Administration 

14 CFR Part 39 

[Docket No. FAA–2013–0094; Directorate 

Identifier 2012–NM–160–AD] 

RIN 2120–AA64 

Airworthiness Directives; Airbus 

Airplanes 

AGENCY: Federal Aviation 

Administration (FAA), DOT. 

ACTION: Notice of proposed rulemaking 

(NPRM). 

SUMMARY: We propose to adopt a new 

airworthiness directive (AD) for all 

Airbus Model A318, A319, A320, and 

A321 series airplanes. This proposed 

AD was prompted by reports that 

certain trimmable horizontal stabilizer 

actuators (THSA) were found with 

corrosion that affected the ballscrew 

lower splines between the tie-bar and 

screw-jack. This proposed AD would 

require repetitive inspections of the 

THSA; ballscrew integrity tests, if 

necessary; and replacement of affected 

THSAs. We are proposing this AD to 

detect and correct corrosion in the 

ballscrew lower splines, which, if the 

ballscrew ruptured, could lead to 

transmission of THSA torque loads from 

the ballscrew to the tie-bar, prompting 

THSA blowback, and possible loss of 

control of the airplane. 

DATES: We must receive comments on 

this proposed AD by April 12, 2013. 

ADDRESSES: You may send comments by 

any of the following methods: 

• Federal eRulemaking Portal: Go to 

http://www.regulations.gov. Follow the 

instructions for submitting comments. 

• Fax: (202) 493–2251. 

• Mail: U.S. Department of 

Transportation, Docket Operations, M– 

30, West Building Ground Floor, Room 

W12–140, 1200 New Jersey Avenue SE., 

Washington, DC 20590. 

• Hand Delivery: U.S. Department of 

Transportation, Docket Operations, M– 

30, West Building Ground Floor, Room 

W12–140, 1200 New Jersey Avenue SE., 

Washington, DC, between 9 a.m. and 5 

p.m., Monday through Friday, except 

Federal holidays. 

For Airbus service information 

identified in this proposed AD, contact 

Airbus, Airworthiness Office—EAS, 1 

Rond Point Maurice Bellonte, 31707 

Blagnac Cedex, France; telephone +33 5 

61 93 36 96; fax +33 5 61 93 44 51; email 

account.airworth-eas@airbus.com; 

Internet http://www.airbus.com. For 

Goodrich service information identified 

in this proposed AD, contact Goodrich 

Corporation, Actuation Systems, 

Stafford Road, Fordhouses, 

Wolverhampton WV10 7EH, England; 

telephone +44 (0) 1902 624938; fax +44 

(0) 1902 788100; email 

techpubs.wolverhampton@

goodrich.com; Internet http:// 

www.goodrich.com/TechPubs.You may 

review copies of the referenced service 

information at the FAA, Transport 

Airplane Directorate, 1601 Lind Avenue 

SW., Renton, WA. For information on 

the availability of this material at the 

FAA, call 425–227–1221. 

Examining the AD Docket 

You may examine the AD docket on 

the Internet at http:// 

www.regulations.gov; or in person at the 

Docket Operations office between 9 a.m. 

and 5 p.m., Monday through Friday, 

except Federal holidays. The AD docket 

contains this proposed AD, the 

regulatory evaluation, any comments 

received, and other information. The 

street address for the Docket Operations 

office (telephone (800) 647–5527) is in 

the ADDRESSES section. Comments will 

be available in the AD docket shortly 

after receipt. 

FOR FURTHER INFORMATION CONTACT: 

Sanjay Ralhan, Aerospace Engineer, 

International Branch, ANM–116, 

Transport Airplane Directorate, FAA, 

1601 Lind Avenue SW., Renton, WA 

98057–3356; telephone (425) 227–1405; 

fax (425) 227–1149. 

SUPPLEMENTARY INFORMATION: 

Comments Invited 

We invite you to send any written 

relevant data, views, or arguments about 

this proposed AD. Send your comments 

to an address listed under the 

ADDRESSES section. Include ‘‘Docket No. 

FAA–2013–0094; Directorate Identifier 

2012–NM–160–AD’’ at the beginning of 

your comments. We specifically invite 

comments on the overall regulatory, 

economic, environmental, and energy 

aspects of this proposed AD. We will 

consider all comments received by the 

closing date and may amend this 

proposed AD based on those comments. 

We will post all comments we 

receive, without change, to http:// 

www.regulations.gov, including any 

personal information you provide. We 

will also post a report summarizing each 

substantive verbal contact we receive 

about this proposed AD. 

Discussion 

The European Aviation Safety Agency 

(EASA), which is the Technical Agent 

for the Member States of the European 

Community, has issued EASA 

Airworthiness Directive 2012–0175, 

dated September 7, 2012 (referred to 

after this as the Mandatory Continuing 

Airworthiness Information, or ‘‘the 

MCAI’’), to correct an unsafe condition 

for the specified products. The MCAI 

states: 

Some Trimmable Horizontal 

Stabilizer Actuators (THSA), Part 

Number (P/N) 47147–500 fitted on 

A330/A340 aeroplanes have been found 

with corrosion, affecting the ballscrew 

lower splines between the tie bar and 

the screw-jack. The affected ballscrew is 

made of steel and anti-corrosion 

protection is ensured, except on both 

extremities (upper and lower splines) 

where Molykote is applied. 

The results of the technical 

investigations have identified that the 

corrosion was caused by a combination 

of: 

—contact/friction between the tie bar 

and the inner surface of the ballscrew, 

leading to the removal of Molykote 

(corrosion protection) at the level of 

the tie bar splines, 

—humidity ingress initiating surface 

oxidation starting from areas where 

Molykote is removed, and 

—water retention in THSA lower part 

leading to corrosion spread out and to 

the creation of a brown deposit (iron 

oxide). 

The results of the technical 

investigations have also concluded that 

A320 family THSA P/N 47145–XXX 

(where XXX stands for any numerical 


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