1

1 BEFORE THE

2 UNITED STATES DEPARTMENT OF ENERGY

3 PRELIMINARY ANALYSIS PUBLIC MEETING FOR

4 BATTERY CHARGERS AND EXTERNAL POWER SUPPLIES

5 TRANSCRIPT OF PROCEEDINGS

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 13 October 2010

Washington, D.C. USA

16 ___________________________________________________

17 BUNN & ASSOCIATES

 Registered Professional Reporters Worldwide

18 Post Office Box 297

 310 South Main Street

19 Lusk, Wyoming 82225 USA

20 In USA 1-800-435-2468 Worldwide 001-307-334-2423

21 Worldwide Telefax 001-307-316-0388

22 E-mail: BUNNWORLDWIDE@aol.com

23 Copyright 2010
2

1 ATTENDEES:

2 DOUGLAS BROOKMAN

 Public Solutions, Inc.

3 Moderator

4 MIKE AGRONIN

 Director

5 Technical Analyses, Building Science and

 Engineering

6 D&R International

7 LARRY ALBERT

 Senior Technical Manager

8 Product Safety and Compliance

 701 East Japps Road

9 MS TW050

 Towson, Maryland 21286

10 USA

 PH 410-716-3148

11 FX 410-716-2109

 Larry.Albert@bdk.com

12 

 TIMOTHY BALLO, Esquire

13 Associate Attorney

 Earthjustice

14 1625 Massachusetts Avenue, NW

 Suite 702

15 Washington, D.C. 20036

 USA

16 PH 202-667-4500

 FX 202-667-2356

17 tballo@earthjustice.org

18 BRIAN BOOHER

 D&R International

19 1300 Spring Street

 Suite 500

20 Silver Spring, Maryland 20910

 USA

21 PH 301-588-9387

 bbooher@drintl.com

22 

23 
3

1 ATTENDEES (Continued):

2 LINDSAY DESTEFANO

 Navigant Consulting

3 PH 412-454-4113

 lindsay.destefano@navigantconsulting.com

4 

 RIC ERDHEIM, Esquire

5 Senior Counsel

 Legislative and Regulatory Affairs

6 Philips Electronics North America

 1050 K Street NW

7 Suite 900

 Washington, D.C. 20001

8 USA

 PH 202-962-8550

9 FX 202-962-8560

 ric.erdheim@philips.com

10 

 HOLLY A. EVANS

11 President

 Strategic Counsel

12 9040 Patton Boulevard

 Alexandria, Virginia 22309

13 USA

 PH 703-496-4832

14 CL 703-409-1007

 h.evans1@verizon.net

15 

 RICK HABBEN

16 Regulator/Safety Compliance Engineer

 Wahl Clipper Corporation

17 2900 North Locust Street

 Post Office Box 578

18 Sterling, Illinois 61081-0578

 USA

19 PH 815-548-8295

 FX 815-625-1841

20 rhabben@wahlclipper.com

21 MATTHEW HARTLEY

 Navigant Consulting

22 PH 202-481-7555

 Matthew.Hartley@navigantconsulting.com

23 
4

1 ATTENDEES (Continued):

2 SANAEE IYAMA

 Program Manager

3 Energy Analysis Department

 Environmental Energy Technologies Division

4 Lawrence Berkeley National Laboratory

 One Cyclotron Road

5 MS 90R4000

 Berkeley, California 94720-8136

6 USA

 PH 510-486-6604

7 FX 510-486-6996

 ssiyama@lbl.gov

8 

 DANIEL LAUF

9 D&R International, ltd.

 1300 Spring Street

10 Suite 500

 Silver Spring, Maryland 20910

11 USA

 PH 301-588-9387

12 dlauf@drintl.com

13 DAVID LIS

 Appliance Standards Program Manager

14 Northeast Energy Efficiency Partnerships

 91 Hartwell Avenue

15 Lexington, Massachusetts 02421

 USA

16 PH 781-860-9177 x 127

 FX 781-860-9178

17 djlis@neep.org

18 MATEUSZ (MATT) MALINOWSKI

 Senior Associate

19 ICF International

 1725 Eye Street NW

20 Suite 1000

 Washington, D.C. 20006

21 USA

 PH 202-862-1200

22 DR 202-862-2693

 FX 202-862-1144

23 MMalinowski@icfi.com
5

1 ATTENDEES (Continued):

2 JOANNA MAUER

 Technical Advocacy Coordinator

3 Appliance Standards Awareness Project

 529 Fourteenth Street NW

4 Suite 600

 Washington, D.C. 20045

5 USA

 PH 202-507-4034

6 jmauer@standardsASAP.org.

7 MARK MENZER

 Senior Director

8 Association Affairs and Programs Development

 Commercial and Electrical

9 Intertek

 11112 Chessington Place

10 Reston, Virginia 20194

 USA

11 PH 703-201-8705

 mark.menzer@intertek.com

12 

 JIM MORGAN, Esquire

13 Director and Counsel

 Government & Industry Affairs

14 Sony Electronics, Inc.

 1667 K Street NW

15 Suite 200

 Washington, D.C. 20006

16 USA

 PH 202-429-3651

17 FX 202-429-3663

 CL 202-436-1562

18 james.morgabn@am.sony.com

19 

20 

21 

22 

23 
6

1 ATTENDEES (Continued):

2 WAYNE E. MORRIS

 Vice President

3 Division Services

 Association of Home Appliance Manufacturers

4 1111 Nineteenth Street NW

 Suite 402

5 Washington, D.C. 20036

 USA

6 PH 202-872-5955 x 313

 FX 202-872-9354

7 Cl 202-256-4200

 wmorris@aham.org

8 

 MATTHEW NARDOTTI

9 Navigant Consulting

 PH 202-481-7546

10 matthew.nardotti@navigantconsulting.com

11 KOUSHALY NARESHKAMAR

 Navigant Consulting

12 PH 202-481-7377

 koushaly.nareshkumar@nagivantconsulting.com

13 

 SUZANNE FOSTER PORTER

14 Senior Manager

 ECOS

15 1199 Main Avenue

 Suite 242

16 Durango, Colorado 81301

 USA

17 PH 970-243-4503

 FX 970-259-8585

18 sporter@ecosconsulting.com

19 ARI REEVES

 D&R International

20 1300 Spring Street

 Suite 500

21 Silver Spring, Maryland 20910

 USA

22 PH 301-588-9387

 FX 301-588-0854

23 areeves@drintl.com
7

1 ATTENDEES (Continued):

2 ANTHONY ROTOLO

 Navigant Consulting

3 PH 585-503-6554

 anthony.rotolo@navigantconsulting.com

4 

 TOBIAS SWOPE

5 D&R International

 1300 Spring Street

6 Suite 500

 Silver Spring, Maryland 20910

7 USA

 PH 301-588-9387

8 FX 301-588-0854

 tswope@drintl.com

9 

 DANIEL TENINTY

10 Senior Regulatory Analyst

 Fulton Innovation

11 7575 Fulton Street East

 Ada, Michigan 49355

12 USA

 PH 616-787-4158

13 616-914-0835

 daniel.teninty@fultoninnovation.com

14 

 MICHAEL VLADIMER

15 Navigant Consulting

 PH 202-481-7323

16 mvladimer@navigantconsulting.com

17 MEG WALTNER

 Energy Advocate

18 Natural Resources Defense Council

 1200 New York Avenue NW

19 Suite 400

 Washington, D.C. 20005

20 USA

 PH 202-513-6270

21 FX 202-289-1060

 mwaltner@nrdc.org

22 

23 NOTE: Cyber attendees remain unidentified.
8

1 

 I N D E X

2 Page

3 Welcome

 By Victor Petrolati 10

4 

 Attendee Introductions and Agenda Review

5 By Douglas Brookman 11

6 Background and Overview

 By Victor Petrolati 15

7 

 Opening Comments from Participants

8 By Suzanne Foster Porter 27

 By Wayne Morris 34

9 By Ric Erdheim 44

10 Product Definitions and Scope

 By Ari Reeves 47

11 

 Market Assessment

12 By Daniel Lauf 96

13 Technology Assessment and Screening Analysis

 By Michael Vladimer 123

14 

 Engineering Analysis

15 By Michael Vladimer 178

 By Matthew Nardotti 247

16 

 Energy Use Analysis

17 By Tobias Swope 295

18 Product Price Determination

 By Daniel Lauf 314

19 

 Life-Cycle Cost and Payback Period Analyses

20 By Matthew Hartley 328

21 Shipments and National Impact Analyses

 By Tobias Swope 347

22 

 Preliminary Manufacturer Impact Analysis

23 By Robert Carmichael 356
9

1 I N D E X

 (Continued)

2 Page

3 NOPR ANALYSES

 By Sanaee Iyama 362

4 

 Closing Comments

5 By Wayne Morris 369

 By Suzanne Porter 375

6 By Larry Albert 377

 By Ric Erdheim 379

7 By Douglas Brookman 381

8 Closing Remarks

 By Victor Petrolati 382

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 
10

1 BEFORE THE

2 UNITED STATES DEPARTMENT OF ENERGY

3 PRELIMINARY ANALYSIS PUBLIC MEETING FOR

4 BATTERY CHARGERS AND EXTERNAL POWER SUPPLIES

5 TRANSCRIPT OF PROCEEDINGS

6 MR. BROOKMAN: Let's take our seats and

7 begin.

8 MR. PETROLATI: Okay. Good morning.

9 My name is Vic Petrolati. I'm with the

10 Standards Program responsible for battery chargers

11 and external power supplies.

12 I want to welcome everybody here to our

13 meeting for our preliminary analysis for standards

14 for battery chargers and external power supplies.

15 We have got an absolutely packed agenda today that

16 will take us to 5:00 o'clock.

17 We're going to do everything possible to

18 try to remain on that agenda. We have brought

19 enough slides today to probably continue till

20 midnight, so we are going to try to keep everybody

21 on the agenda as much as possible.

22 And, Doug, I want to make sure that we

23 try to do that, okay?
11

1 I don't want to say anything more in

2 terms of welcoming introductions. We'll get right

3 into the presentations very soon.

4 Let me turn it over to Doug to just go

5 over some of the ground rules.

6 MR. BROOKMAN: Thank you. It's our

7 practice to have introductions first, I think, so

8 please say your name and those you represent.

9 We, we won't capture all of this on the

10 microphone, but we do have a Record of who's in the

11 room because everybody registered, name and --

12 (Whereupon, at 9:07 a.m. ET, those

13 present announced their names and affiliations.

14 Those attending via cyber attendance remained

15 unidentified, after which the following occurred:)

16 MR. BROOKMAN: Thank you for being here.

17 At the registration table is a handout.

18 It includes an Agenda, which I'm going to run

19 through very briefly, a very thick packet of

20 PowerPoint slides which will be the basis for the

21 presentation, the questioning, and the discussion

22 today, and also a few additional attachments which

23 will be referenced during the course of the day.
12

1 Immediately following this Agenda review

2 I think Vic is going to make some brief summary,

3 some, some introductory remarks, and then in that

4 sequence there's an opportunity for anybody that

5 wishes to do so to make brief summary remarks,

6 remarks on key issues and concerns. We hope that

7 they can be brief.

8 We don't anticipate reading anything

9 lengthy into the Record.

10 Following that introduction background

11 and regulatory history, then moving directly to

12 market and technology assessment. We'll take a

13 break midmorning round about 10:25, 10:30-ish or

14 so.

15 We'll see where the natural break point

16 is. Returning from that we'll have Screening

17 Analysis, Engineering Analysis, then Markups,

18 Energy Use, Life-Cycle Costs, Shipments, National

19 Impact Analyses.

20 We'll break for lunch around about

21 noon-ish. Immediately following lunch, then, --

22 We'll provide instruction for those of you that are

23 new to the Forrestal Building on where to go and
13

1 how to proceed with lunch.

2 Immediately following lunch we'll have

3 Utility and Environmental Impacts, Employment

4 Impact, and Regulatory Impact Analyses, and then

5 immediately following that, Proposed Standard

6 Levels. We'll break mid-afternoon as required.

7 Regulatory Flexibility Act Consideration

8 when we return, and then finally Conclusions. And

9 there's yet another opportunity for anybody that

10 wishes to do so to make additional comments,

11 concluding remarks, issues that not, have not been

12 covered fully during the span of the day.

13 So, there's another opportunity there,

14 and we, the agenda that I have --

15 MR. PETROLATI: Doug.

16 MR. BROOKMAN: So, my packet that's

17 contained in the Agenda, it's the Agenda for the

18 meeting tomorrow. So, we should all just refer to

19 the slides that you -- So, this reflects -- And

20 I've got it right here. -- that what Vic said

21 earlier on a lot of the same kind of format,

22 although you can see the, the

23 content areas are slightly different and we,
14

1 though, will go as quickly, as efficiently as

2 possible, and possibly end today closer to 5:00

3 than this previous Agenda reflects, 3:00.

4 So, that's the overview on the agenda.

5 You can take a quick look through it.

6 I'm not going to repeat and re-do the

7 agenda. Any questions and comments on the agenda?

8 (Whereupon, at 9:11 a.m. ET, no response

9 was had.)

10 MR. BROOKMAN: I see none. I'd

11 ask for your consideration. We have done a lot of

12 these meetings over the years.

13 If you would, please speak one at a

14 time. Please, you'll have to turn on the

15 microphones.

16 The little green LED button needs to be

17 bright in order to hear you and record you, your

18 comments on the Record. Please say you, your name

19 every time you speak.

20 You don't need to say your organization

21 affiliation unless you wish to or are in the habit

22 of doing so. I'm going to be using this.

23 I wish to have follow-on comments, so,
15

1 to have some back-and-forth. That sometimes is

2 very useful in terms of building the Record.

3 If you could keep the focus here, that

4 would be very helpful. Please turn your cell

5 phones on silent mode and please keep your sidebar

6 conversations down. These microphones work very

7 well.

8 And, if you can be considerate and share

9 the air time. We have a lot of contents.

10 And that's all I

11 wanted to cover. So, comments from anybody before

12 we start?

13 (Whereupon, at 9:12 a.m. ET, no response

14 was had.)

15 MR. BROOKMAN: Okay.

16 MR. PETROLATI: Okay, let me cover

17 listening to the, via the web cast, as we have in

18 quite a few of your meetings. We're using the

19 Webinar today to reach our stakeholders that are

20 not able to attend.

21 The Department is broadcasting this

22 meeting over the Internet, obviously, and we're

23 providing webcast to accommodate those stakeholders
16

1 that are unable to attend the public meeting. They

2 cannot comment.

3 It will allow them to listen in and view

4 the slides of the presentations, but during this

5 meeting we are not accepting, not accepting

6 questions from our stakeholders. That is something

7 that we want to do in the future, and we'll try to

8 make sure that next time we have a BC/EPS meeting

9 we will have the webinar and we'll try to address

10 questions from the stakeholders in the future.

11 Okay. All stakeholders are encouraged

12 to submit written comments after the public

13 meeting.

14 The comment period is supposed to close

15 by this Friday, October fifteenth. We are going to

16 extend the comment period.

17 I've just been informed we'll have to do

18 that by Federal Register Notice. It certainly

19 will -- We'll not extend it beyond another two-week

20 period.

21 I think that's the twenty-eighth or

22 twenty-ninth of October. But, we will do that by

23 Federal Register notice.
17

1 So, so, you have two weeks from this

2 Friday, is our planned date for getting all the

3 comments in, and you should see a Federal Register

4 Notice on that soon. Okay.

5 Let me just cover purpose of the meeting

6 before we get started here. To present the

7 procedural and analytical approaches to evaluate

8 energy conservation standards for battery chargers

9 and external power supplies, provide a forum for a

10 public discussion of the rulemaking issues.

11 We want to, obviously, encourage

12 interested parties to submit data, information, and

13 written comments, and inform interested parties and

14 facilitate this rulemaking process. That is our

15 purpose for the public meeting.

16 Throughout the presentations today you

17 are going to see these issue boxes come up. These

18 are specific areas that we would like to get

19 stakeholder comment on.

20 But, I want to encourage you to provide

21 comments on anything that is either presented

22 today, or anything in the supporting materials that

23 were available for this public meeting. So, not
18

1 only do we want you to focus on the comment boxes

2 and the issues that we specifically need to get

3 comment on, but anything that is presented that

4 you're interested in.

5 Okay. These are your ways of submitting

6 comments.

7 Okay, please refer to the Battery

8 Chargers and External Power Supplies Energy

9 Conservation Standard Docket Number and regulatory

10 information number. You can submit comments

11 through the Federal eRulemaking Portal, or you can

12 provide comments directly to our e-mail box that we

13 have established BC&EPS@ee.doe.gov.

14 We certainly accept comments by postal

15 mail or by courier as well. So, these are your

16 forms for getting us the comment.

17 Again, the comment period will be

18 extended two weeks beyond the closing dates of

19 October fifteenth. Okay.

20 Any questions on submission of comments

21 or the comment period?

22 (Whereupon, at 9:15 a.m. ET, no response

23 was had.)
19

1 MR. PETROLATI: Okay. I'm going to go

2 into, very quickly, the background and overview for

3 our standard regulatory process.

4 Okay. I want to review the statute

5 authority, statutory authority with you.

6 I want to present our current Standards

7 for Class A EPSs. I want to present a time line of

8 DOE actions and milestones for all the rulemakings

9 that are under way for battery chargers and

10 external power supplies.

11 And, I want to review the components of

12 the preliminary analysis, and explain what

13 additional steps we'll be taking as part of the

14 Notice of Proposed Rule. Okay.

15 This just gives you a quick schematic of

16 how legislation is accomplished. We've got the

17 Energy Policy Act of 2005, which amended the Energy

18 Policy and Conservation Act, adding battery

19 chargers and external power supplies to our

20 program.

21 The Energy Independence and Security Act

22 of 2007 further amended EPCA, resulting in the

23 current rulemaking, a rulemaking for establishing
20

1 Standards for non-Class A EPSs, as well as battery

2 chargers. The Department of Energy is responsible

3 for establishing Standards under the Energy Policy

4 and Conservation Act of 1975 for these products.

5 Okay. Just, again, the, a little

6 schematic to show how the rulemaking process works.

7 Congress and the President pass public

8 laws that are codified in the United States Code.

9 DOE publishes Rules and Final Rules in the Federal

10 Register.

11 Final Rules are codified in the Code of

12 Federal Regulations. EPCA, in this case, is the

13 example of the United States Code that was

14 established by Congress.

15 Okay. Any questions?

16 (Whereupon, at 9:17 a.m. ET, no response

17 was had.)

18 MR. PETROLATI: Fairly simple for those

19 who have about been involved in our rulemaking

20 process. Okay, the test procedures are codified in

21 Title 10, the Code of Federal Regulations, Part

22 430, Subpart B.

23 Battery chargers appear in Appendix Y.
21

1 External power supplies appear in Appendix Z.

2 That's where you can find the test

3 procedures for these products. Okay.

4 Let me just quickly cover the Standards

5 that have been established so far for Class A EPSs.

6 EISA, in 2007, established a Standard for Class A

7 EPSs that became effective on July first, 2008.

8 It incorporated both active mode

9 standards and a no-load standard. We are

10 obviously, as part of this process, evaluating this

11 Standard to determine whether or not more stringent

12 Standards can be set.

13 Okay. Time frames.

14 The Final Rule for Standards for Battery

15 Chargers, Class A EPSs and non-Class A EPSs, we are

16 required to have a Final Rule by July, 2011. All

17 right.

18 In the effective date for that Rule, the

19 date when products will have to be in compliance,

20 is July, 2013. We are expecting that to be the

21 effective date for both battery chargers and

22 external power supplies.

23 Okay, the non-Class A EPS determination
22

1 was completed. Our final determination was May of

2 2010.

3 Those products are currently in our

4 Preliminary Analysis. They will be in our NOPR,

5 and most likely our Final Standards.

6 Okay, the PC active mode test procedure,

7 we're expecting a Final Rule on the test procedure

8 by the end of this year. The effective dates for

9 that Final Rule, we expect the amendments to the

10 Class A EPS test procedure to become effective 30

11 days after that Final Rule, where the amendment

12 also for the battery chargers and non-Class A EPSs

13 will become effective approximately 180 days after

14 the establishment of the Final Rule of July, 2011.

15 So, we've phased in the effective date

16 of the test procedures in accordance with many of

17 the comments that we have received on that. Okay.

18 This is just showing you the

19 documentation. We obviously had a Federal Register

20 Notice.

21 I want to apologize. We have

22 all of the documents associated with this Public

23 Meeting up on our web site as of late yesterday.
23

1 I sent out e-mails as of late yesterday.

2 I certainly would have liked to have done that a

3 few days before our meeting.

4 Apologize for that, but everything is

5 available at this point on our web site concerning

6 meeting materials. Obviously we had the technical

7 support document, as well as other documents for

8 your review up on the web site a little over a

9 couple weeks ago, I believe.

10 Okay. This is talking about EPCA and

11 the seven factors.

12 I'm not going to go through in any

13 detail. I think a lot of you are familiar with the

14 seven factors that we have to consider, and the

15 types of analyses that DOE has to basically provide

16 as part of the analysis.

17 We're going to go through every one of

18 those analyses today that has been done so far

19 under our preliminary analysis for both Class A,

20 non-Class A EPSs and battery chargers. Okay, this

21 is just a flow diagram in terms of all those

22 analyses and what the outputs of those analyses

23 are, and where they go as part of this process.
24

1 Again, every one of these boxes will be

2 talked about today as we present the information.

3 So, this is just a summary overview of the way

4 we're going to present the information later in the

5 meeting.

6 Okay. Since we're at the

7 preliminary analysis stage, we haven't completed

8 all of the steps associated with the Notice of

9 Proposed Rule.

10 This breaks down what's done in the

11 preliminary analysis in terms of what has to be

12 evaluated and what additional steps we will have to

13 include before coming up with our Notice of

14 Proposed Rule. Again, I'm not going to go into

15 detail.

16 We're going to cover every one of those

17 steps during the presentations today on the

18 preliminary analysis, and we'll have a short

19 presentation later on the additional steps that

20 need to be conducted for the NOPR.

21 Okay, before we get to opening comments,

22 any questions? Background?

23 History? Where we are? Where are we
25

1 going?

2 MS. PORTER: Susan Porter from ECOS. I

3 just had a question.

4 I wondered if you could please restate

5 when you plan to have the effectiveness date for

6 the battery chargers system test procedures,

7 please.

8 MR. PETROLATI: Yes, Suzanne. At this

9 point we're planning on that to be effective 180

10 days after the Standard is published in the Federal

11 Register

12 MS. PORTER: So, July of 2011?

13 MR. PETROLATI: I'm certainly hoping to

14 meet that date. Yep.

15 MS. PORTER: Right. Thank you.

16 MR. PETROLATI: We're certainly hoping

17 to meet that date. Yep. Exactly.

18 Okay, any other questions?

19 (Whereupon, at 9:23 a.m. ET, no response

20 was had.)

21 MR. PETROLATI: Thank you.

22 Doug, we are ready for opening comments

23 from the participants.
26

1 MR. BROOKMAN: Brenda is not here. I

2 know we have Suzanne Foster Porter from ECOS, who

3 wants to present some opening comments, and I

4 believe the only other individual that I received

5 notification from was Ric Erdheim.

6 Is that correct, or are there any other

7 opening comments?

8 MR. MORRIS: I'd like to make --

9 MR. BROOKMAN: You'd like to.

10 While we're queuing Suzanne's slides,

11 let's hear from Wayne.

12 MR. MORRIS: I'm willing to wait for

13 Suzanne. She had asked first.

14 MR. BROOKMAN: Okay.

15 Let me note also that we just

16 distributed the corrected, the correct Agenda, for

17 those of you that were as confused as I was at the

18 outset. So, now you can look at it.

19 Take a quick peek. This will be the, a

20 -- These will be the major content areas that are

21 covered, as described --

22 (Whereupon, at 9:24 a.m. ET, remarks

23 were made among those present, off the Record,
27

1 after which the following occurred:)

2 MR. BROOKMAN: -- during, in these time

3 periods.

4 PUBLIC OPENING REMARKS

5 MS. PORTER: Thank you for the

6 opportunity to make opening remarks. My name is

7 Suzanne Foster Porter.

8 I'm with ECOS Consultants, here

9 representing Pacific Gas and Electric and other

10 investor-owned utilities in the State of

11 California. I'm going to just use this opportunity

12 to make a few brief high-level comments that are

13 sort of over-arching, focused on the battery

14 charger portion of the technical support document.

15 We wanted to recognize some elements of

16 the DOE approach that we wanted, that we support.

17 Specifically, it obviously is based on the upcoming

18 test procedure of the battery chargers that DOE,

19 DOE's expecting to complete later this year that

20 includes active modes.

21 (Whereupon, at 9:25 a.m. ET, Mr.

22 Petrolati left the room, after which the following

23 occurred:)
28

1 MS. PORTER: It expands the battery

2 charger product group from what we saw in the

3 framework document more than a year ago, and it

4 proposes a method to distinguish between battery

5 Charger systems and external power supplies that is

6 in alignment with other jurisdictions around the

7 world, as well as the original definition that was

8 set by Codes and Standards in California.

9 And we appreciate DOE's considerations

10 of multiple levels of external power supply

11 standards, including Level 5 and beyond. I have

12 three key comments I'd like to overview.

13 Specifically, the first one is that we

14 believe the DOE analysis approach for battery

15 charger systems overlooks the cost-effective

16 savings for battery chargers. We would recommend

17 the Department look at a different alternative

18 structure for the analysis, specifically looking at

19 collapsing the number of product classes, and

20 considering additional candidate standards levels.

21 This is just an illustration of the way

22 that the analysis currently is done. We've gotten

23 product classes with consideration of efficiency
29

1 kind of vertically within each product class, and

2 we would like to see a slightly different approach

3 where we can consider the transferable technologies

4 across product classes that might be found in

5 markets where price is not as sensitive, and

6 portability is more a function, a focus in the

7 market.

8 And so more efficient technologies have

9 been incorporated. The key reason why we believe

10 it's important to consider to change the number of

11 product classes is that although AC/DC battery

12 chargers have a variety of sizes the functionality

13 is the same.

14 They're all providing portable power,

15 and like external power supplies, efficiency should

16 scale with the size of the power being provided, --

17 (Whereupon, at 9:27 a.m. ET, Mr.

18 Petrolati entered the room, after which the

19 following occurred:)

20 MS. PORTER: -- specifically battery

21 energy and/or battery voltage. But, we don't feel

22 like there's enough difference in the marketplace

23 to warrant individual product classes within the
30

1 AC/DC class, so we're recommending collapsing

2 Product Classes 2 through 7 specifically.

3 In addition, we suggest adding candidate

4 standards levels between 2 and 3. Right now DOE is

5 looking at best-in-market and maximum technology,

6 and because there haven't been battery charger

7 standards that have had a significant

8 influence in the market anywhere in the world

9 before, we think it's warranted to consider higher

10 levels that would be associated with transferable

11 technology within each product class.

12 Our second comment is that we believe

13 this single annual metric that DOE is considering

14 is technically infeasible. Specifically, no duty

15 cycle exists that allow DOE to provide data-driven

16 weighting for products.

17 Much of the duty cycle data is based on

18 assumptions or limited measurements. And even if

19 were, data were collected, we believe that those

20 data would be highly variable, and so any duty

21 cycle chosen, just like external power supplies,

22 would not necessarily represent the product class.

23 Instead, we propose DOE group duty
31

1 cycles into two functional groups. Essentially, we

2 know that some battery chargers are charged

3 sometimes, this is the majority of battery

4 chargers.

5 If the product has an active mode

6 regularly expected in the duty cycle, then we would

7 propose that that be one duty cycle element, and

8 the metric to be used with that would be the

9 24-hour, or active mode efficiency metric that

10 includes both active and battery maintenance mode,

11 plus a standby mode, which could be allowed

12 separately.

13 The other category would be for the

14 emergency battery backup system, which is product

15 Class 10, where the battery is virtually never

16 charged because of the nature of the product. It's

17 meant to be a, a backup system, and therefore it's

18 only charged when the alternating current outlet is

19 unavailable.

20 You know, the power system goes down,

21 and for this product class we recommend just

22 looking at the power maintenance limit. "No

23 Battery" mode is not necessarily applicable.
32

1 And lastly we believe that within that

2 AC/DC product class DOE should con-, we recommend

3 they consider a continuous curve. A scaling

4 relationship for product classes could be based on

5 what's found in the market and could be structured

6 very similarly to what DOE is already doing for

7 external power supplies.

8 They're already looking at scaling

9 relationships among product classes in the current

10 preliminary analysis, so we would propose to take a

11 more than general approach by collapsing the

12 product classes and scaling the energy efficiency

13 requirement. And this could be based on battery

14 energy, battery voltage, or both.

15 The PG&E approach for the California

16 Energy Commission Standards is based on battery

17 energy.

18 In summary, our analysis for Pacific Gas

19 and Electric suggest that cost-effective savings

20 can be reduced, excuse me, cost-effective savings

21 can reduce use by roughly two-thirds, and DOE can

22 find these savings by looking, reducing the number

23 of product classing, classes, and increasing the
33

1 number of CSL levels.

2 We believe the annual energy use metric

3 is technically infeasible, and instead, DOE should

4 employ individual metrics that come directly out of

5 the test procedure.

6 Lastly, a continuous function for

7 efficiency is more appropriate because it avoids

8 boundary condition issues, which I didn't get into

9 very much here, but avoids boundary condition

10 issues between product classes, but also, more

11 appropriately, it reflects the utilities of the

12 battery chargers systems.

13 Thank you for the opportunity to provide

14 opening remarks.

15 MR. BROOKMAN: Thank you. Nicely done.

16 Are you going to make your slides

17 available for everyone?

18 MS. PORTER: Yeah. I don't know

19 if DOE would be comfortable putting them on the web

20 site, but we would be happy to submit these to the

21 Docket.

22 MR. BROOKMAN: That's the main thing.

23 So, let's proceed.
34

1 Wayne Morris, are you ready?

2 MR. MORRIS: Sure, Doug. Thank you.

3 Wayne Morris, with the Association of

4 Home Appliance Manufacturers. I guess it's

5 probably good that we agree with something that

6 Suzanne said, to begin with.

7 And we would all agree with the, the

8 fact that it's important that the Department has

9 provided a great deal of data on this, on, on this

10 rulemaking. It is an important one.

11 It is one that our industry, at least,

12 has supported this rulemaking since its inception.

13 We have continuously asked that the Department move

14 ahead rapidly on this rulemaking which it is doing,

15 and that it do so on the basis of a lot of

16 technical information.

17 And we're pleased that the technical

18 resources of a number of consulting groups and

19 staff have been made available on this

20 important rulemaking. I would say that we do

21 have a couple of very genuine concerns that we

22 have made available and that we have mentioned in

23 several of the activities.
35

1 I think that everyone ought to agree to

2 two propositions. First, Congress made it clear

3 that external power supplies and battery charger

4 categories should be regulated by the Federal

5 Government.

6 And second, it's bad regulation to

7 double-regulate a product for the same

8 characteristic energy, and even worse to do so in a

9 manner where it's unclear into which categories

10 products or components fall. So, we need to take a

11 step back and ensure that we are representing the

12 product category comprehensively, but not

13 double-regulating.

14 It's irrational to do otherwise, and

15 unless we're actually compelled by Statute to do

16 so, and that that was Congress' intention, we ought

17 to find a way out of it. We have explained many

18 times that we consider, unlike many external power

19 supplies, a battery charger and its power supply, such as a

20 portable rechargeable electric shaver or portable

21 vacuum cleaner are completely integrated.

22 It's not a device purchased off the

23 shelf, but a design part of the overall appliance
36

1 from its very beginning. If regulation drives the

2 overall battery charging system away from the part which

3 goes into the wall and into the part where the product

4 is recharged, then we're creating a real confusing

5 mess.

6 Fortunately, there are several ways to

7 handle this. First, the law makes it clear in

8 EPCA, Section 321, Subsection 36, the definition of

9 "external power supply," that a Class A external

10 power supply does not include any device that

11 powers the charger, a detachable battery pack, or

12 charges the battery of the product that is fully or

13 primarily motor operated.

14 We do not understand why this doesn't

15 end the debate there. Our products such as that

16 that is incorporated into a portable vacuum cleaner

17 or to a portable electric shaver contain devices

18 that charge the battery of a product that is motor

19 operated.

20 This does not mean that it's exempt from

21 regulation, because it's classified clearly as a battery

22 charger meaning a device that charges batteries.

23 Consumer products including battery chargers
37

1 embedded in other consumer products, that's not

2 escaping regulation. That's simply a

3 classification.

4 And for some reason this exemption from

5 EPS coverage is not sufficient, then, as described

6 in the May 14, 2010, Federal Register, Option B, or

7 modified option B more or less achieves the same purpose.

8 Under Option B, our type of wall adapter would not

9 be considered EPS as long as it powers a battery

10 charger. We're very clear about the type of

11 products we are discussing, including

12 motor-operated appliances, floor-care appliances,

13 personal-care appliances.

14 We do not understand the comment on Page

15 27172 of the Federal Register that this approach is

16 a problem because, quote, would create two

17 definitions of "EPS," which would prevent one from

18 readily identifying a particular wall adapter as

19 being an EPS until it is known whether it powers

20 the charger of a detachable battery pack, or

21 charges the battery of the product that is fully or

22 primarily motor-operated, unquote.

23 What does it mean, or what is the
38

1 significance of preventing one from readily

2 identifying a particular wall adapter as being an

3 EPS? We don't understand that.

4 DOE will have no problem monitoring

5 compliance of the law because the evaluation and

6 testing will be done for the component as

7 incorporated in the overall product. Isn't that

8 correct? For example, the testing by EPA under

9 its new certification Rules and verification

10 requirements will be for the product as

11 incorporated. 

12 Third, if for some reason the Option

13 B or Modified Option B approach does not work and 

14 the Department cannot see its way clear to just 

15 simply exclude from EPS coverage -- And we're not 

16 asking exclusion from the Regulation -- then why not 

17 use the provision in EPCA Section 325 Q, "Special 

18 Rules," for certain types of classification of products 

19 that allows a separate class and separate standard if 

20 the product, quote, has a capacity or other performance21 related features which other products in such type or 

22 class do not have, and such feature justifies a higher 

23 or lower Standard from that which applies and will

24 apply to other products which are in such type or
39

1 class, unquote.

2 DOE is required to consider such factors

3 as the utility to the consumer of the feature.

4 In this case, whether you call it an EPS or a BC,

5 the point is that you create a separate class and

6 have as a standard and test procedure testing and

7 requirements that are appropriate to this component

8 as proscribed by EPCA and the Energy Independence

9 and Security Act of 2007.

10 Surely between these, and possibly other

11 options, we can provide federal regulation in a

12 clear manner that avoids confusion to the regulated

13 industry, to regulators, and to other industry

14 parties, but will avoid the testing burdens and

15 functional restrictions of double-regulation. We

16 would include that in that, that -- I think I've

17 read now close to 1,000 pages of information and I

18 still can't tell whether this thing is an external

19 power system or a battery charger.

20 Seems to me we could have solved that

21 one a lot easier. Thank you very much.
40

1 MR. BROOKMAN: Thank you.

2 So, let's note for the Record that you

3 held up a hand-held shaver, correct?

4 MR. MORRIS: Battery rechargeable with

5 battery recharger.

6 MR. BROOKMAN: Okay. And what's the

7 other -- What's the other device? Excuse me.

8 MR. MORRIS: Battery charger and, --

9 MR. BROOKMAN: Got ya.

10 MR. MORRIS: -- and the shaver that goes

11 with it.

12 MR. BROOKMAN: Oh, okay. I didn't know

13 they were attached to one another.

14 MR. MORRIS: They can be. If you want

15 me to, I will be glad to.

16 MR. BROOKMAN: There we go.

17 MR. MORRIS: Attached.

18 MR. BROOKMAN: Great.

19 Other comments from others at the

20 outset? Brief summary remarks about concerns?

21 One of you. Who would like to go first.

22 MR. ALBERT: Larry Albert, Stanley Black

23 & Decker.
41

1 First of all I wanted to compliment the

2 Agency and these consultants on the amount of work,

3 analysis, and data collection that went into the

4 Technical Support Document. It, it's a very

5 comprehensive document.

6 It is clearly a lot of thought, a lot of

7 analysis. You can tell there was a lot

8 of discussion that went on in the formulation of the 

9 document and the work that went behind it. And it's 

10 good to see that the Department's taken such an effort 

11 to try to get this as correct as it can be, all right?

12 And it's definitely an important document. 

13 I also want to compliment the Department on taking the 

14 advice that we provided and I think is the obvious 

15 approach in utilizing the annual energy use at the 

16 metric to drive the Standards-making process.

17 I think it's meaningful because not

18 only does it establish a practical link between

19 the Regulation and the usage of the product, but

20 also between the Regulation and the benefits to the

21 consumer public, all right? And that's a key issue.
42

1 You can certainly regulate on many other

2 factors. The question then becomes: Is it

3 meaningful with respect to the public, and does the

4 public actually derive any benefit?

5 There are a few issues, though, we would

6 like to bring up, one of which is, again, wall

7 adapters that are used for motor-operated applications and

8 detachable battery packs. And, again, I think the

9 issue here is the case where you have these wall

10 adapters for MADBs that are used with battery

11 charging, either in the end product or with

12 detachable battery packs.

13 And, again, does the regulation of those

14 provide any net benefit to the consumer, given that

15 you're regulating the battery charging system

16 it's a part of? Again, it's been our contention

17 all along that those are situations where the

18 energy efficiency of the entire system, the

19 Regulation that captures the energy efficiency of

20 the entire system provides for the energy

21 efficiency of its component parts.

22 And we think that the law provides

23 sufficient opportunity to discriminate in those
43

1 cases so that those are not to be separately

2 regulated.

3 And the next point I think is that,

4 necessarily in creating product classes, you need

5 to lump together a number of products that may not

6 all be the same type. Right?

7 And in the case for us, in particular,

8 in Product Class 4, lumping together battery

9 charging systems that are used for notebook and,

10 and laptop computers along with those for power

11 tools, we believe there's some fundamental

12 differences between the two product categories.

13 Right?

14 And, and while we recognize the

15 need to sort of summarize these into, in broader,

16 broader product 

17 classes, we think there may be some opportunity to 

18 provide some, you know, meaningful differentiation or

19 meaningful accommodation with respect to those two 

20 different product classes, or categories, rather.

21 And lastly, I want to just be very clear

22 that, you know, we see this as a way of

23 improving the energy efficiency of products,
44

1 products that are designed based upon consumer

2 demand and utility, and we want to make sure that

3 there's no inherent, in the Regulation, there is no

4 presumptions as to changing utility with respect to

5 either charge time or cell chemistries. Right?

6 And we need to make -- We believe that

7 the Regulation should be careful as to

8 ensuring, as it looks at higher technology options,

9 that those options do not presume something about

10 the utility of the product or the

11 consumer demand for a particular product category.

12 Thanks so much.

13 MR. BROOKMAN: Thank you.

14 Ric.

15 MR. ERDHEIM: Thank you, Doug. And good

16 morning.

17 Since you're going to ask me for the

18 Record, I will be holding up a Philips Norelco

19 beard trimmer, and I'll also be holding up a beard

20 that the beard trimmer works on.

21 MR. BROOKMAN: I wish we had video.

22 MR. ERDHEIM: There we go.

23 MR. BROOKMAN: It just happens to be
45

1 Philips electronics. Okay.

2 I thought I would clarify that for the

3 Record. Go ahead.

4 MR. ERDHEIM: Again, thank you very

5 much. We've participated at every step along the,

6 the way in this process, and we've made the same

7 point at every step, which is that the basis

8 for this Regulation is to save energy.

9 You can't save energy if

10 the product is almost never plugged into the

11 outlet. We want to thank the Department.

12 They've gone through and

13 identified 57 different products, and put down

14 estimates of active, maintenance, no battery, 

15 and most importantly for the point we've been

16 raising, the unplugged element of the product.

17 I counted this morning. Of those 57, 18 are unplugged 23

18 hours a day, and I would argue that that's probably

19 an understatement. This beard trimmer, for which

20 the estimate is that it's unplugged 23 hours and

21 plugged in one hour, when I bought this in July I

22 charged it for three hours.
46

1 Haven't had to recharge it yet. There's

2 a "Low Bat," "Low Charge" on it.

3 "Low charge" light is not lit. I'm not

4 going to spend -- This product's not going to spend

5 one day in "charge," let alone one, one hour a day.

6 So, -- But, it's very important that the

7 Department has done this, because you can't come up

8 with energy savings unless products are plugged-in.

9 But, I'm disappointed at the same time

10 that the Department has, in coming up with the

11 categories, not used usage factors as a

12 distinguishing characteristic.

13 And that means that you're going to be

14 lumping products together with different usage

15 factors, and the result is you have to be

16 overestimating the amount of energy that you'll be

17 saving. And we think that's a fundamental problem.

18 So, I'll be talking more about that as

19 we go along. Thank you.

20 MR. BROOKMAN: Thank you. Thank you.

21 Other comments here at the outset as

22 we're about to launch into the content? And

23 there's a lot to cover here.
47

1 (Whereupon, at 9:45 a.m. ET, no response

2 was had.)

3 MR. BROOKMAN: Okay, let's do that.

4 Let's proceed with the content slides.

5 The webinar's working okay?

6 A TECHNICIAN: Um-hum.

7 MR. BROOKMAN: Okay.

8 PRODUCT DEFINITIONS AND SCOPE

9 MR. REEVES: Hello. I'm Ari Reeves from

10 D&R International.

11 I'm going to present on 

12 the product definitions and scope.

13 (Whereupon, at 9:46 a.m. ET, Mr.

14 Brookman conferred with a technician, out of the

15 hearing of others and off the Record, during which

16 the following occurred:)

17 MR. REEVES: Okay, great. I'm going to

18 go over four things.

19 First, what is the approach

20 for BCs with wall adapters, something that's

21 already been discussed? Secondly, what's an

22 external power supply?

23 Thirdly, what's a battery charger? And
48

1 lastly, what's a consumer product?

2 So, first of all, DOE is moving forward

3 with Approach A as described in the framework

4 document. Under this approach, a wall adapter's

5 always considered part of the battery charger, and

6 it's also considered an external

7 power supply, but only if it does not perform

8 charge control.

9 I'll explain what DOE's criteria for

10 determining the presence of charge control are in

11 the next slide. Or a couple slides.

12 So, this approach has received broad

13 stakeholder support both at the

14 time of the framework document public meeting, and

15 also in connection with the later test procedure

16 NOPR public meeting. And in the context

17 of the determination, and it applies to Class A

18 EPSs, non-Class A EPSs, and battery chargers.

19 And the diagram here shows what I've

20 just described, that the whole system is a

21 battery charger, and the wall adapter also is an

22 EPS if it does not contain charge control.

23 So, what's an external power supply?
49

1 The first four parts here are from the Statute,

2 EISA and EPACT.

3 It's outside, external to, the product

4 that it operates. It attaches to and obtains power

5 from mains.

6 It outputs DC current or lower-voltage

7 AC current, and powers a consumer product. And

8 then there are some additional attributes that

9 constitute an interpretation that DOE is using in

10 order to evaluate and eventually set, perhaps set

11 more stringent Standards for these products, and

12 that is:

13 Does not perform -- An EPS does not

14 perform charge control functions as determined using

15 DOE's evaluation criteria. And it may be a

16 component of the battery charger.

17 So, these are kind of -- These aren't

18 explicit in the Statute, but flow from it.

19 So, let's look at this question of charge control.

20 What is charge control? How do we

21 determine whether a wall adapter has charge control

22 in it?

23 The current method that DOE's pursuing
50

1 is based on the ENERGY STAR criteria for EPSs. And

2 if you look at the criteria, Version 2.0,

3 it says Section -- It's under "Definitions."

4 They have a definition for "external

5 power supplies," and it's Parts F and G of that

6 definition. So, if a wall adapter meets either of

7 these two conditions here that you see on the

8 slide, then it is assumed not to contain charge

9 control.

10 The first condition is that it

11 has batteries or battery packs that physically

12 attach directly, including those that are removable,

13 to the power supply unit. This includes power-tool

14 chargers such as the one depicted here, as well as

15 universal battery chargers and others.

16 The other condition -- And, remember,

17 it's an "or." If either of these conditions hold,

18 then it's not a battery charger.

19 It's not considered an external power

20 supply if the wall adapter, if it has a battery

21 chemistry or type selector switch and an indicator

22 light or state-of-charge meter. The "and" is

23 important here.
51

1 That means it's not sufficient to simply

2 have a battery chemistry or type-selector switch,

3 or have an indicator light or state-of-charge meter. You

4 have to have one from the first line and one from

5 the second line in order to be considered 

6 as not an external power supply.

7 So, DOE analyzed six other methods, and

8 none were found to be superior to this method. All

9 seven methods are detailed in Appendix 3-C to the

10 TSD.

11 The idea, the main idea here is that the

12 energy performance of these wall adapters that do

13 contain charge control will be addressed

14 by battery charger Standards because it's clear

15 that they're always used to charge batteries.

16 And at this time I'd like to take

17 comments on how best to determine whether a wall

18 adapter performs charge control functions. And I

19 should also add here that if people have ideas for

20 how we can make, if DOE were to proceed with

21 these current criteria, if people have ideas for

22 how they can be spelled out more clearly,

23 particularly this first criteria about 
52

1 batteries and battery packs that physically attach

2 directly,

3 DOE welcomes those as well.

4 MR. BROOKMAN: Please enter your name

5 into the Record.

6 MR. TENINTY: My name the Dan Teninty

7 again. I'm with Fulton Innovation; also

8 representing the Wireless Power Consortium, which

9 is a consortium of 56 companies, including Philips.

10 The technology used for wireless power,

11 wireless powering of products, uses primarily

12 inductively coupled technology. The

13 modularity of the system is not adequately

14 described by any of the categories or classes used

15 here because there will be suppliers of

16 transmitters.

17 For example, office furniture could have

18 a device built into it that would power a laptop or

19 a cell phone inductively coupled. And so it's

20 not the -- The charge control is in the end

21 product.

22 And there is an

23 interoperability standard that is available to the
53

1 public on the Wireless Power Consortium web site.

2 It's notable by the logo that is

3 licensed and restricted for use to the consortium

4 members or associate members,

5 including companies like Texas

6 Instruments, Nokia, Philips, Everready, Energizer,

7 Sanyo. So, there are some rather major

8 international corporations that are involved.

9 We will be submitting written comment.

10 We found out about the activity here rather

11 late in the game, so we were unable to supply

12 comment.

13 But, there needs to be provision for

14 this type of technology in the Standard. Otherwise

15 there is going to be a major impact on the market

16 in trying to categorize, and things are going to

17 get stalled, and products won't reach market.

18 MR. BROOKMAN: Thank you.

19 Other comments?

20 Yes.

21 MR. ALBERT: Larry Albert, Stanley Black

22 & Decker.

23 Couple of questions, Ari. First of all,
54

1 to address your question about charge control,

2 when I looked at Appendix 3-C, and looked at the

3 products that were used in evaluating the

4 suitability of the various methods, it did not

5 include those wall adapters that were associated

6 with motor-operated products or detachable battery

7 packs, which was obviously, at the time we were

8 commenting on this with respect to what we thought

9 might be suitable methods, which you, -- And you

10 did address those methods, right, but I don't think

11 you looked at those categories.

12 And it was possibly because that

13 evaluation was done at the point where you were not

14 considering wall adapters to be part of the class

15 of EPSs, and perhaps that's why you didn't include

16 them. But, it's a pretty large category, I think,

17 that would have a large influence upon the outcome

18 of your analysis if you were to include them.

19 And since, in the final analysis, they

20 end up getting regulated, or may be getting

21 regulated as EPSs, anyway, they deserve notice

22 within the analysis. Otherwise you're not, you

23 know, fairly treating them, because they're
55

1 either a member of the class or not a member of the

2 class, right?

3 Secondly, to go back to your other

4 question with respect to direct connection, it's

5 always been a little fuzzy, at least in my mind,

6 anyway, and I wonder if you could let me know how

7 the Department is viewing that. In other words,

8 how do you determine direct connection?

9 MR. PETROLATI: Vic Petrolati,

10 Department of Energy.

11 That is one of the issues that we are

12 trying to get stakeholder comment on. The only

13 thing we've provided is two examples which we

14 considered to be direct connection.

15 And we are, in certain cases, evaluating

16 other examples, but we would like to get

17 stakeholder comment, since we haven't had

18 experience with this EPA ENERGY STAR criteria,

19 whether or not there are ambiguities, and what
56

1 those ambiguities are. And if you could present

2 those to us, and how they should be handled, that

3 would be extremely helpful.

4 MR. ALBERT: Okay. And I guess the

5 follow-on question to that is:

6 It seems like, because of the

7 restrictions in the Code, you feel like you

8 need to stick to those ENERGY STAR requirements in

9 determining whether something is an EPS or not.

10 But, in the case of non-Class A EPSs you've been

11 relieved of that obligation, right?

12 So, you're applying, essentially, I

13 sense, applying the same criteria for Class A and

14 non-Class A EPSs, right?

15 MR. PETROLATI: Correct.

16 MR. ALBERT: But, you're not obligated

17 to apply those criteria for non-Class A EPSs,

18 right?

19 MR. PETROLATI: That is right. The same

20 definition that we had for Class A EPS?

21 MR. ALBERT: Right.

22 MR. PETROLATI: It's not the same

23 definition that we're required to follow for
57

1 non-Class A.

2 MR.ALBERT: Right. So, --

3 MR. PETROLATI: So, this was a policy

4 call in terms of how we would treat a wall adapter

5 as an EPS. And the policy call was that we

6 wouldn't be concerned about whether it was

7 connected to a battery charging system that had

8 been excluded under the Class A definition, or a

9 battery charging system that had been included

10 under the Class A definition.

11 And to give you examples, there are wall

12 adapters connected to battery chargers under the

13 Class A definition such as external power supplies

14 powering the cell phones or notebook computers

15 which are clearly covered under Class A.

16 MR. ALBERT: Correct.

17 MR. PETROLATI: And we have the

18 definition under Approach A that corresponds to how

19 that would be treated. We also have adopted that

20 same approach for those products connected to

21 battery-charging systems that are motor-operated

22 batteries or detachable batteries.

23 And, we have a very limited
58

1 definition of what a detachable battery is. So,

2 we have applied one definition across the line to

3 define EPSs.

4 And that is correct: It was a policy

5 call.

6 MR. ALBERT: Alright. Well, obviously

7 we believe that there's sufficient difference 

8 in these classes, the motor-operated and detachable

9 battery class, which we

10 believe should, you know, warrant perhaps separate,

11 distinct criteria than those that fall under Class

12 A EPSs.

13 And we believe that, you know, the

14 Statute recognizes that. And so --

15 MR. PETROLATI: If I could ask a couple

16 of questions?

17 MR. ALBERT: Sure.

18 MR. PETROLATI: In my mind, that creates

19 two specific definitions for whether or not a wall

20 adapter is an EPS, where one would not be able to

21 make that determination until one knew exactly what

22 that wall adapter was being connected to. If that
59

1 wall adapter was being connected to a cell phone or

2 a notebook computer, you're indicating it should be

3 a Class A EPS.

4 But, if that wall adapter is connected

5 to a motor-operated -- and let's just use

6 motor-operated product -- you would say that that

7 wall adapter is not an EPS.

8 Consequently, one would have to know

9 what that wall adapter is connected to before

10 making the distinction as to whether or not that

11 product is an EPS.

12 MR. ALBERT: Right. And the

13 rationale behind that is, in part, that those wall

14 adapters that are provided with motor-operated

15 products are provided as part of the product

16 offering.

17 They're offered for sale to the

18 consumers, used --

19 MR. PETROLATI: Right.

20 MR. ALBERT: -- solely with that

21 product, right?

22 MR. PETROLATI: Right.

23 MR. ALBERT: And any energy savings that
60

1 is a result of Regulation -- Right? -- is only

2 realized by the use of that product along with

3 that wall adapter.

4 It's not that the consumer's purchasing

5 a separate wall adapter off the shelf from some

6 other source that they intend to use in a variety

7 of different ways.

8 MR. PETROLATI: Right.

9 MR. ALBERT: And so this notion that

10 that these wall adapters were, themselves,

11 the consumer items, and, therefore, the consumer

12 would be able to realize some benefit from the

13 Regulation -- Right? -- is almost always the

14 exception, and not the majority of cases.

15 MR. PETROLATI: I agree with not the

16 majority of cases, but let's --

17 MR. ALBERT: Right.

18 MR. PETROLATI: -- talk about the

19 exception. There are wall adapters that would be

20 defined as EPSs in the active market at this point,

21 sold at Radio Shack and other places, that might be

22 used in terms of charging battery-charging

23 systems -- would that be correct?
61

1 MR. ALBERT: That those --

2 MR. PETROLATI: -- that could be used --

3 MR. ALBERT: Yes, they could be.

4 MR. PETROLATI: -- as a wall adapter or

5 EPS for charging battery-powered systems.

6 MR. ALBERT: So, clearly in those cases

7 where they're offered for sale separately --

8 MR. PETROLATI: Right.

9 MR. ALBERT: -- then it makes sense to

10 regulate it because the consumer gains

11 benefit from in terms of energy efficiency.

12 MR. PETROLATI: Right. Yep.

13 MR. ALBERT: Where the adapter is part

14 of the end-use product as offered for sale, --

15 MR. PETROLATI: Yep.

16 MR. ALBERT: -- then the only

17 energy savings the consumer realizes is that due to

18 the Regulation of the complete package, right?

19 MR. PETROLATI: Yep. Yep.

20 MR. ALBERT: This end product, whether

21 that is an integral part power tool --

22 MR. PETROLATI: Right.

23 MR. ALBERT: -- or whether it's a
62

1 detachable battery charger, --

2 MR. PETROLATI: Yep.

3 MR. ALBERT: -- all of that is linked

4 into a single end product, which you're already

5 regulating; correct?

6 MR. PETROLATI: Right. So, your

7 definition, if I understand that correct, is that

8 the wall adapter would not be considered, even

9 though it met all the EPS criteria, if it was sold

10 by the battery-charging system.

11 And, that battery-charging system would

12 have to be a motor-operated or detachable battery

13 system.

14 MR. ALBERT: Correct. And, we believe

15 there's some precedent for this in, for

16 example, the ENERGY STAR system.

17 There the mark is associated with

18 the battery-charging efficiency for the product

19 that's offered for sale. And so, certainly, the

20 Department could adopt a similar sort of

21 approach from a regulatory -- I guess from

22 a conformation -- standpoint, that's ultimately what's

23 going to happen anyway.
63

1 End products have to be evaluated as

2 they're offered for sale in the market, because

3 that would be the point where the

4 Department could take action in the case of

5 noncompliance.

6 MR. PETROLATI: But, that's not,

7 unfortunately, the only place that the Department

8 could take action. The Department can take action

9 on imports.

10 MR. ALBERT: Um-hum.

11 MR. PETROLATI: And I want to ask you

12 how we would handle the import situation. Would

13 this wall adapter that's coming in to charge this

14 battery-charging system of only a motor-operated

15 product, if it's imported, would it be imported

16 with the motor-operated product as well?

17 MR. ALBERT: At least in our case, 

18 in almost every case that I can imagine -- Right?

19 -- we import the finished product.

20 That is, the tool with the

21 wall adapter, or we're importing the tool with the

22 battery charger with the wall adapter

23 physically attached. Without exception
64

1 it connects to the cup, right?

2 MR. PETROLATI: Right.

3 MR. ALBERT: And so, therefore, it's

4 clearly part of that, and the detachable battery

5 charger.

6 MR. PETROLATI: Can you envision, or can

7 you think of a product that would be importing a

8 wall adapter defined as an EPS if it's connected to

9 a motor-operated product that would be imported,

10 without the end-use consumer

11 product?

12 MR. ARNOLD: I can't think of a case

13 that I'm familiar with in our industry -- Right?

14 MR. PETROLATI: Okay.

15 MR. ALBERT: -- where that's true.

16 Right.

17 MR. PETROLATI: Right. And 

18 that's solely the power tool industry that you're

19 referring to?

20 MR. ALBERT: Power-tool industry, but

21 we're also active in battery-operated vacuums and

22 some other small, battery-operated appliances.

23 MR. PETROLATI: Right. Okay.
65

1 MR. ALBERT: So, within that range of

2 product. Right?

3 MR. PETROLATI: Right.

4 MR. ALBERT: There is not an instance I

5 can think of where the wall adapter is not either

6 associated with --

7 MR. PETROLATI: Right.

8 MR. ALBERT: -- or a finished product

9 for sale.

10 MR. PETROLATI: Yep.

11 MR. ALBERT: Even though it's not

12 physically attached, or it's part of, it's

13 physically attached to the base, you

14 know, the charging base, for example, --

15 MR. PETROLATI: Right.

16 MR. ALBERT: -- to the battery charger.

17 MR. PETROLATI: Right.

18 MR. ALBERT: And so in all those cases

19 it's easy to determine that that's the

20 case. Now, we may be shipping in wall adapters to

21 our factory for inclusion into an end product,

22 right?

23 But, that's not a consumer product I
66

1 believe at that point -- Right? -- because it's

2 just used as a --

3 MR. PETROLATI: Right.

4 MR. ALBERT: -- an OEM component.

5 Right? So, in those cases it should be

6 -- You know, I don't know as much about import

7 and export, but it would seem to me that would be

8 easy to discriminate, right? So, the big question

9 for us, which is what we've said all along, is that

10 we want to make sure that whatever the Regulation

11 does, that it's realizable by the end consumer.

12 Right?

13 MR. PETROLATI: Right.

14 MR. ALBERT: And we see that wall

15 adapters are used as part of battery chargers. The

16 regulation of those obviously adds cost -- Right?

17 -- without any realizable benefit, because the

18 charger it's connected to is separately regulated,

19 -- Right? -- and therefore you have to meet

20 that requirement anyway.

21 And that -- Since that requirement has

22 an energy benefit to it and a cost associated with

23 it, -- Right? -- there's no
67

1 energy benefit, you know, differentially to the

2 consumer associated with regulating wall adapters

3 that are attached to battery chargers.

4 Right? So, there's a

5 cost upper without an energy benefit, essentially.

6 MR. PETROLATI: Right. Although we are

7 required under Class A to take the same approach

8 that we are taking for non-Class A.

9 MR. ALBERT: Correct.

10 MR. PETROLATI: Did Congress think that

11 there was a benefit under those circumstances from

12 a standpoint of the enforcement, or from energy

13 savings?

14 MR. ALBERT: It's difficult for me to

15 comment on this because of the fact that,

16 obviously, that everything we're interested in

17 falls within the non-Class A categories.

18 MR. PETROLATI: Yeah. Right.

19 MR. ALBERT: But, if I took the category

20 broadly and looked at, you know, what would

21 be sort of comparable products, -- Right? -- they

22 would be wall adapters intended for, you know,

23 laptops and for cell phones and so on, right?
68

1 MR. PETROLATI: Telephones; yeah.

2 MR. ALBERT: And so from those, you

3 know, in a technical perspective, I can, I

4 certainly feel that those, though, fulfill the

5 technical intention of what it would be, although

6 certainly the manufacturer of those products could

7 have made a similar argument, right?

8 And so it may be the case that, you

9 know, it wasn't recognized at the time that these

10 were distinct enough because they weren't --

11 MR. PETROLATI: No, they weren't, they

12 weren't excluded, as the motor-operated products

13 were.

14 MR. ALBERT: Correct.

15 MR. PETROLATI: Yeah.

16 MR. ALBERT: Right.

17 MR. PETROLATI: Yeah.

18 MR. ALBERT: But, whether that was a

19 function of whether that was brought to Congress'

20 attention or not, -- Right? -- or a function of

21 whether there was, in fact, Congress viewed no

22 benefit, that there was benefit to regulating those

23 or not, I can't say.
69

1 Right?

2 MR. PETROLATI: Right.

3 MR. ALBERT: I can say from a technical

4 perspective that the wall adapters that

5 are used for laptop computers, -- Right? -- you

6 know, have a very different sort of role

7 in that situation by virtue of the fact that, you

8 know, that they're essentially fully

9 regulated separate power supplies that can operate

10 the computer independent of the battery.

11 Right? And that's certainly not the

12 case in all of our products.

13 Right?

14 MR. PETROLATI: Yeah.

15 MR. ALBERT: And that's why we believe

16 there was a technical reason for differentiating

17 these; -- Right? -- that it's the difference from

18 the other ones.

19 Right? And so that's why, you know, I

20 think we presented that position.

21 So, we think there's a technical basis

22 for it. We think in terms of consumer benefit

23 there's clearly no benefit in regulating these wall
70

1 adapters separately.

2 And, you know, we've always pushed for a

3 regulation of the battery charger. And it seems

4 that some of these methods have sort of,

5 looking at it now, and trying to figure out where

6 to draw that line, such as charge control, direct

7 connection, so on.

8 Right? Don't, don't seem like they get

9 to that core issue, right?

10 MR. PETROLATI: Right.

11 MR. ALBERT: Which is: Is there a

12 benefit or not, right?

13 MR. PETROLATI: Okay. One other

14 question I've got for you.

15 When we met with you years ago, --

16 MR. ALBERT: Yes.

17 MR. PETROLATI: -- a year and a-half

18 ago, you told us at that point that none of the

19 wall adapters that serviced your products included

20 charge control. Excuse me.

21 They all included charge control, if

22 I remember correctly.

23 MR. ALBERT: At the time you
71

1 were looking at charge control to subsume the

2 possibility of having distinctive

3 characteristics.

4 MR. PETROLATI: Right.

5 MR. ALBERT: And that's reflected in

6 your analysis that's done in 3-C, right?

7 MR. PETROLATI: Yeah.

8 MR. ALBERT: You know. So, we believe

9 that's true for the vast majority of products

10 that we have right now.

11 The switch to lithium ion may ultimately

12 change that composition. Right?

13 So, I may need to amend that comment in

14 the future. Right?

15 MR. PETROLATI: Right.

16 MR. ALBERT: You know. But, at the

17 time, you know, I think that was pretty

18 representative of the product offerings that we

19 have.

20 MR. PETROLATI: Right. And does the EPA

21 criteria that we have now adopted distinguish the

22 wall adapter sold with your system as having either

23 charge control or not having charge control?
72

1 MR. ALBERT: What I

2 believe you have, are planning to adopt, --

3 MR. PETROLATI: Right.

4 MR. ALBERT: -- which is going back to

5 the ENERGY STAR criteria, -- Right?

6 MR. PETROLATI: Right.

7 MR. ALBERT: -- limits the definition of

8 "charge control" to specific features.

9 MR. PETROLATI: Right.

10 MR. ALBERT: It means you need both a

11 switch and an indicator, right?

12 MR. PETROLATI: Right.

13 MR. ALBERT: And so we don't have that.

14 Right?

15 MR. PETROLATI: Okay.

16 MR. ALBERT: And when you look at some

17 of the other criteria which we had proposed, --

18 Right?

19 MR. PETROLATI: Attached directly to the

20 battery.

21 MR. ALBERT: No, no. With respect to

22 charge control.

23 MR. PETROLATI: Right.
73

1 MR. ALBERT: You, you investigated other

2 charge control criteria --

3 MR. PETROLATI: Right.

4 MR. ALBERT: -- which were

5 short-circuit, you know, whether you can, could

6 short-circuit, you know, regulation of all those

7 issues.

8 MR. PETROLATI: Right.

9 MR. ALBERT: We proposed those as

10 alternative criteria from a functionality,

11 VI performance standpoint. Those were evaluated

12 with products other than our products, right?

13 MR. PETROLATI: Okay.

14 MR. ALBERT: And so we don't find it

15 surprising that you didn't see any positive

16 determination, right?

17 MR. PETROLATI: Okay.

18 MR. ALBERT: But, we're just saying: If

19 we're going to be in that class, you should have

20 included us in the determination. Right?

21 MR. PETROLATI: Alright.

22 MR. ALBERT: Charge. Direct connection.

23 You know. Again, our, our position
74

1 would be galvanic connection is direct connection,

2 right?

3 MR. PETROLATI: Right.

4 MR. ALBERT: It's the only one that

5 matters. Whether it's in the enclosure or there's a

6 piece of wire that connects to it, it's

7 immaterial, right?

8 MR. PETROLATI: Right.

9 MR. ALBERT: And the third thing is: It

10 powers a product, right?

11 And "powers a product" means that it's

12 connected to the product -- Right? -- and it

13 provides the power for the product.

14 And in none of the cases of the MADBs --

15 Right? -- does that qualify, because it either

16 powers a battery charger, which is not the product,

17 -- Right?

18 The product is the drill. Right?

19 Or, if it's connected to the drill, --

20 Right? -- it's not capable of powering it because

21 the power demands of the end product are much

22 greater than the adapter can provide.

23 Right?
75

1 So, it's incapable of either providing

2 power, or it's not connected to power. So,

3 therefore, the powered product is not by itself,

4 okay?

5 MR. PETROLATI: Okay, let me ask my

6 question. And you may have given --

7 MR. ALBERT: Okay.

8 MR. PETROLATI: -- the answer and I

9 missed it.

10 The wall adapter that is connected to

11 the motor-operated products, your products, would that qualify as an EPS 

12 under the ENERGY

13 STAR criteria?

14 MR. ALBERT: It may,

15 depending upon the direct-connection criteria, --

16 MR. PETROLATI: Right.

17 MR. ALBERT: -- which is why I was

18 asking about that.

19 MR. PETROLATI: Yeah.

20 MR. ALBERT: Yeah.

21 MR. PETROLATI: And in certain cases,

22 have the products in your industry been certified

23 or voluntarily covered under the ENERGY STAR
76

1 program as external power supplies?

2 MR. ALBERT: Well, we've had, obviously,

3 the case in California where we've had to do that.

4 Yes. Yeah.

5 MR. PETROLATI: Okay. Based on the same

6 criteria?

7 MR. ALBERT: Based on this criteria,

8 yes.

9 MR. PETROLATI: Okay.

10 MR. MORRIS: Which we have consistently

11 disagreed with.

12 MR. BROOKMAN: Wayne, we didn't get

13 that.

14 MR. MORRIS: Sorry. Wayne Morris, with

15 AHEM.

16 MR. ALBERT: So, the question we see

17 here is: As you look at how it is different from

18 those, you're moving past, if I'm remembering now,

19 it's CSL-1, or something.

20 It, it's for the EPS levels. EPS. I'm

21 sorry.

22 MR. PETROLATI: ENERGY STAR.

23 MR. ALBERT: EPA.
77

1 MR. PETROLATI: Right.

2 MR. ALBERT: Okay. So, as you go beyond

3 that voluntary requirement, -- Right?

4 MR. PETROLATI: Right.

5 MR. ALBERT: -- and you're seeing that

6 you've got positive payback, -- Right?

7 MR. PETROLATI: Right.

8 MR. ALBERT: -- that positive payback

9 presumes that consumers derive benefit from 

10 those higher and more stringent levels. Right?

11 MR. PETROLATI: Right.

12 MR. ALBERT: But, since the criteria

13 used to evaluate the energy efficiency of EPSs 

14 is distinct from the criteria used to determine the

15 energy efficiency of battery chargers, then we

16 believe the criteria for battery chargers

17 represents what's actually realizable by the

18 consumer. Right?

19 Therefore, the cost associated with

20 increasing the efficiency of EPSs -- Right? --

21 does not translate into any energy efficiency

22 that's realizable by the consumer, and so,

23 therefore, it does two things.
78

1 It never makes a payback for

2 the wall adapter. Right?

3 It always makes that negative. And

4 while the battery-charging system may already have

5 a positive payback, it will be less positive by

6 virtue of the fact that you added more costs into a

7 component that has no net effect upon the final

8 result.

9 Right? I don't think that was taken

10 into account.

11 I don't think that calculation was

12 considered in evaluating payback analysis in that

13 subset of MADBs that are used as part of 

14 either, you know, integral or battery chargers.

15 Right?

16 It may have, but I didn't see it, you

17 know. And so that's the issue.

18 You know. The issue is that we see, you

19 know, increasing regulation.

20 I think where you were leading is:

21 Aren't you already living with this? Right? Is

22 probably where you were heading?

23 MR. PETROLATI: Well, I was trying to
79

1 understand. But, right.

2 MR. ALBERT: Right. We're already

3 living with this.

4 But, the very nature of the rulemaking

5 process is that it's not just what you're living

6 with --

7 (Whereupon, at 10:15 a.m. ET, Mr.

8 Petrolati and Mr. Kido conferred, out of the

9 hearing of others and off the Record, during which

10 the following occurred:)

11 MR. ALBERT: -- today, but what the

12 future portends. And what we see there is

13 increasing levels of restrictions --

14 MR. PETROLATI: Go ahead, Larry.

15 (Whereupon, at 10:15 a.m. ET, Mr.

16 Petrolati and Mr. Kido conferred, out of the

17 hearing of others and off the Record, during which

18 the following occurred:)

19 MR. ALBERT: -- increasing

20 levels of restriction on no-load and active

21 mode energy efficiency, without any translatable

22 benefit to the consumer.

23 MR. BROOKMAN: Let me note that I saw
80

1 other representatives from the manufacturing

2 community nodding your heads consistently while

3 Larry was talking. Do you wish to contribute to

4 this Record in any way, briefly?

5 Wayne does, if you don't.

6 Ric?

7 MR. ERDHEIM: Ric Erdheim, Philips. Vic

8 asked about imports, and we would import 100

9 percent of our final product.

10 MR. BROOKMAN: That was one of the

11 things that both you and your counterpart, Rick,

12 also, you were both nodding in agreement, I thought,

13 at that point.

14 MR. HABBEN: Yeah. We would just

15 confirm what Larry was saying about the wall

16 adapter being always supplied with the product.

17 And, and in most of our cases --

18 (Whereupon, at 10:16 a.m. ET, Mr.

19 Petrolati and Mr. Kido conferred, out of the

20 hearing of others and off the Record, during which

21 the following occurred:)

22 MR. HABBEN: -- with the UL

23 Regulations, most of the time the UL Standards will
81

1 require that you actually state on your product and

2 on the wall plug to use with the particular model

3 number of the trimmer or the appliance that

4 your wall plug is supplied with. So, they are

5 meant to go together as a system.

6 I'd also like to comment that, you know,

7 we do not have with -- In our instructions we do

8 not recommend, or we do not allow the consumer to

9 go out and purchase an off-the-shelf 

10 transformer or wall adapter to substitute

11 with our product because we don't know how the

12 performance is going to be with that wall adapter

13 that we have not tested.

14 It may charge the batteries too fast and

15 cause overheating and functional problems with the

16 product.

17 MR. BROOKMAN: Yeah.

18 MR. HABBEN: So, it has to go, the

19 correct wall adapter with the correct product.

20 MR. BROOKMAN: Okay. Thank you.

21 Wayne, do you want to comment at this

22 point? Do you want to ask a follow-on question

23 here?
82

1 MR. PETROLATI: No. No, all set.

2 MR. BROOKMAN: Okay, Wayne. Wayne

3 Morris.

4 MR. MORRIS: Wayne Morris, with AHAM.

5 Appreciated Mr. Albert's comments because I think

6 they adequately state what we have said in numerous

7 hearings and in our written comments as well.

8 And so I take significant opposition to

9 the comment that, unfortunately, Ari, you made

10 earlier that there was broad stakeholder agreement

11 with Option A. It was certainly never our intent

12 to agree to Option A.

13 We have steadfastly indicated that we do

14 not believe Option A is appropriate for battery

15 chargers. Non-Class A EPS is some figment of a

16 new definition that was created, not one that

17 actually exists in reality.

18 We're talking about a wall

19 adapter. The Department seems, in the Technical

20 Support Document, to flip-flop back and forth a

21 number of times.

22 In places they have called them "wall

23 adapters;" in other places they called them "EPSs;"
83

1 and in places they called them "battery chargers."

2 There's not a consistency throughout.

3 I would also mention that the shipment

4 numbers that are shown are different between things

5 that are supposedly wall adapters for one

6 particular class of product such as a wall

7 adapter that drives the battery charger and a

8 cordless rechargeable vacuum number.

9 The shipment numbers in the EPS number

10 are different than in the section for battery

11 chargers. The Department must have some difference

12 there that they understand between a wall

13 adapter that's driving one from another, and yet

14 there's no explanation in the document as to how

15 they knew.

16 You know, it -- There's an old joke

17 about Thermos bottles: You know, that they keep hot

18 things hot and cold things cold. How do they know

19 the difference?

20 I think that we have a situation here.

21 We have EPSs and battery chargers, and I don't

22 think the Department really understands what the

23 difference is.
84

1 Our industry does understand what the

2 difference is. The wall adapter that is connected

3 to -- And we said this all along --

4 A wall adapter that is

5 connected to a battery-charging system is part of

6 the battery charger, is mated with it. It is sold

7 with it.

8 It is marketed to be used with it. It's

9 a clear situation.

10 The Department does not have a

11 difficulty, we don't believe, in enforcing this

12 Regulation because there is going to be a clear

13 indication that, as they look at, you know, 

14 the end products for sale in the

15 marketplace, it's going to be clear that: Is it

16 recharging the battery? And that: Is it sold

17 together with it?

18 So, we think that a lot of this 

19 is going back and taking parts of old definitions

20 and then taking parts of new definitions and trying

21 to ram them together. It's not appropriate, and we

22 think that what they're trying to do here with 

23 this Regulation is to fix things and make it
85

1 clear from here going forward, not to try and jive

2 old definitions together that were, in fact,

3 written before EISA.

4 So, I think it's important we try to

5 fix these things, not make them more complicated.

6 MR. BROOKMAN: Larry.

7 MR. ALBERT: Hold it. I wanted to make

8 one more point.

9 You mentioned your dilemma

10 with -- This is Larry Albert from Black & Decker --

11 You mentioned your dilemma earlier with the problem

12 that EISA provided you with a distinct

13 definition for Class A, and how do you reconcile

14 that for those cases that don't fall under the MADB

15 category?

16 But, certainly in that definition is

17 where they mention powers consumer products.

18 And in that case, again, I think it offers an

19 opportunity by looking at that particular criteria

20 to discriminate those wall adapters -- All right?

21 -- that don't qualify as powering the consumer

22 product.

23 Either they power a battery charger
86

1 itself, and that, itself, is not the

2 consumer product, -- Right? -- or they are not

3 capable of powering the product all by

4 itself.

5 And in that case I think you'd find that

6 there are things like wall adapters for laptops that

7 would qualify as an EPS using that criteria because

8 they're capable of powering the end product,

9 the consumer product. Right?

10 And the same thing with cell phones.

11 However, in all of the cases that are

12 motor-operated or detachable battery packs, they

13 don't fit within that requirement of powering

14 either the end product, which is the consumer

15 product.

16 They don't power the end product itself

17 in the case of integral. They don't power the

18 consumer product in the case of the battery

19 charger, which is not the product itself.

20 MR. PETROLATI: Okay.

21 MR. ALBERT: Alright?

22 MR. BROOKMAN: Okay.

23 MR. PETROLATI: Okay. Mike, one point.
87

1 MR. BROOKMAN: At this time, Mr. Mike

2 Vladimer.

3 MR. VLADIMER: Michael Vladimer with

4 Navigant Consulting.

5 I just want to restate the problem, I

6 think, because some of what you were saying 

7 from your technical perspective might not be the

8 same as what Vic was thinking from a policy

9 perspective. So, I think you're saying as

10 far as VI curves and voltage relationships and all

11 those things, when you were referring to the

12 conversation that we had a couple of years ago, the

13 issue is:

14 From a circuitry perspective 

15 it can be pretty clear what "charge

16 control" means. But, from a regulatory perspective

17 it's very hard to look at a wall adapter and

18 know whether it contains that circuit without

19 cracking it open and having the circuit diagram, or

20 whether it's just an inefficient product.

21 And so the main -- I think you've

22 made some really great points, and if you have

23 suggestions as to how to refine these criteria, I
88

1 think that the main issue is: How do you figure

2 out what's in the box?

3 Or, if you want to go so far

4 as to, say, take the product and look it up and

5 look at the circuit diagram and do it that way.

6 But, that's really the problem from

7 the policy perspective: What

8 criteria can you use consistently to identify this

9 issue, Larry, a little better?

10 MR. PETROLATI: Yeah. And I think

11 that's what you've been trying to address.

12 But, yeah. It is certainly different

13 than ours at this point. Is there additional?

14 MR. BROOKMAN: Thank you.

15 Ric? Now Larry.

16 MR. ALBERT: So, basically, you know,

17 the way we viewed the charge control thing is that

18 it's something that we needed to deal with because

19 it was an artifact of the original definition of what

20 qualified as EPSs, not that it fundamentally

21 addressed the question of: Here's a power source

22 or component of a battery charger.

23 Right? And so while we've been trying
89

1 to work on the charge control thing it's because we

2 believed it was the only way of helping to

3 differentiate these because it's not clear.

4 The important thing is: Is it part of the battery

5 charger?

6 And, if the battery charger's being

7 regulated, then you don't need to regulate the wall

8 adapter. And so the best thing would be to

9 find a way in which you could clearly lump, you

10 could say:

11 "This thing belongs with this. It's a

12 battery charger.

13 "We're already regulating. There's no

14 sense regulating the component of it.

15 Right? And so the whole charge control

16 thing was just because charge control was one of

17 the criteria for exclusion.

18 Right? And it really wasn't, you know,

19 because we felt like it was the most important

20 thing.

21 Right? Our point, I recall, 

22 I think early on in the discussion was in
90

1 terms of understanding the 

2 technical difference between what a power

3 supply and a power source for a battery

4 charger was fundamentally, and sort of the degree

5 of regulation, and whether it could ride through a

6 short circuit.

7 So, if you need -- So, I had sort of the

8 electrical analysis that you wanted to perform on

9 this box, you, you could, right? But, that's not

10 the key issue.

11 The key issue is it's part of a battery

12 charger.

13 MR. BROOKMAN: So, we should proceed now

14 I think, right?

15 MR. PETROLATI: Right.

16 MR. BROOKMAN: Let's proceed with that.

17 Ari, I'm going to ask you to present that later.

18 MR. REEVES: Will do.

19 MR. BROOKMAN: Keep moving. We've got a

20 lot of slides to get through here.

21 MR. PETROLATI: Sorry.

22 MR. REEVES: Okay, let's move on to:

23 What is an EPS? On the left-hand side here you see
91

1 kind of a parsing of the classification of EPS

2 provided by EISA 2007.

3 Class A EPSs output only one voltage at a

4 time, have output power less than 250 watts,

5 do not power medical devices, do not provide input

6 for a product that is fully or primarily motor

7 operated, and is not a power battery charger for

8 detachable battery packs.

9 DOE has divided Class A EPSs into four

10 separate categories based on their output current

11 type and output voltage. And I'll just provide a

12 few example applications here, but all the product

13 classes will be discussed in

14 more detail later.

15 The four product classes here, A1,

16 A2, A3, and A4. Cordless phones are an example of an

17 application for A1.

18 Mobile phones and MP3 players 

19 are example applications for A2, home security

20 systems for A3, and aquarium accessories and indoor

21 fountains for A4.

22 Class A EPSs were the primary focus of

23 the preliminary analysis of EPSs. So then non-Class
92

1 A EPSs are all those EPSs that don't fit the

2 definition of Class A. And you should have a

3 handout that's entitled "Battery Charger and

4 External Power Supply Product Classes

5 in the Preliminary Analysis." 

6 There are two tables, one for --

7 MR. BROOKMAN: Looks like this.

8 MR. REEVES: I invite you to refer to this

9 throughout the day. It's a handy crib sheet.

10 And for non-Class A EPSs, as I said,

11 it's everything that doesn't fall into Class A.

12 And DOE classified them into four groups: multiple

13 voltage, high-power, medical, and MADB.

14 And for medical and MADB, they're

15 further subdivided into four -- each is further

16 subdivided into four product classes that mirror

17 those for Class A EPSs.

18 So, what is a battery charger? Battery

19 chargers charge batteries for consumer products and

20 may be embedded in a consumer product.

21 Those two attributes are taken directly

22 from the definition in the Statute. And then there

23 are two additional elements that DOE has added in:
93

1 May obtain power from mains or another

2 source, and that's added because the statutory

3 definition is silent on the source of power. So,

4 unlike EPSs, which must obtain their power from

5 mains, BCs may obtain their power from mains or

6 another source, such as USB ports and 12-volt

7 cigarette lighters and the other auxiliary power

8 ports in automobiles.

9 But, like EPSs, we see battery chargers

10 charge batteries for consumer products as well.

11 So, let's move on to the next slide.

12 Here's a list of battery charger product

13 classes. I won't go over this now because we'll

14 see this later in the context of the technology

15 assessment.

16 And then lastly: What is a consumer

17 product? So, again, a consumer product is defined

18 in the U.S. Code.

19 It consumes energy or water. It is, to

20 a significant extent, distributed in commerce for

21 personal use or consumption by individuals.

22 And, a consumer product is not an

23 automobile. An automobile is defined in the U.S.
94

1 Code as well.

2 For those who want that reference, it is

3 49 USC 3291(a)(3). So, here on the list, here on

4 the left is a list of some consumer products that

5 we have considered within the preliminary analysis,

6 and on the right are some products that were not

7 considered within DOE's analysis because they were

8 not considered consumer products.

9 First and foremost is road vehicles.

10 That's basically all electric vehicles

11 that are regulated by Federal Motor Vehicle Safety

12 Standards. So, this includes the low-speed

13 vehicles as well as, like, full-on electric cars.

14 Also, commercial and industrial products

15 such as forklifts, emergency egress lighting,

16 credit-card scanners, bar-code scanners. You might

17 be able to think of some others.

18 Those were not included within our

19 analysis. And for a full list of all the

20 applications that we have included to date, you can

21 see Appendix 3-A.

22 MR. BROOKMAN: Larry.

23 MR. ALBERT: Larry Albert. Quick
95

1 question, Ari.

2 Products that, for instance, connect

3 to cigarette lighters, they were not excludable

4 under the generalization for automobile, or -- It

5 would seem to be something outside of DOE's

6 purview.

7 MR. PETROLATI: That's correct. They

8 were not excludable under the definition of

9 "automobiles."

10 MR. ALBERT: Okay.

11 MR. PETROLATI: And we did check with

12 Legal Counsel in terms of whether or not the

13 definition of "automobiles" would be a factor in

14 terms of whether those products were excluded, and

15 where it was not set.

16 MR. BROOKMAN: We got all of that. It

17 wasn't mic feeds, but we got it.

18 MR. PETROLATI: Okay. Pardon.

19 MR. REEVES: That's the end of my

20 presentation.

21 MR. BROOKMAN: Yeah.

22 Some comments, then, on the preceding

23 slides? I think a lot of these definitional issues
96

1 were covered in the other discussion.

2 Don't mind a short shrift of this

3 important topic. Okay.

4 Then let's proceed. Let's see.

5 It's 10:30. How many -- Who's

6 presenting next?

7 How many slides in your first chunk

8 next?

9 MR. LAUF: I believe about 15.

10 MR. BROOKMAN: Fifteen slides. I guess

11 we should take a break.

12 Let's take a break. It's 10:30. We'll

13 resume here at 10:45.

14 (Whereupon, at 10:32 a.m. ET, those

15 present took a brief recess and returned at 10:50

16 a.m. ET, after which the following occurred:)

17 MR. BROOKMAN: So, let's start back up.

18 Please take your seats.

19 We're going to resume where we left off,

20 and Daniel Lauf is going to be presenting on market

21 assessment.

22 MARKET ASSESSMENT

23 MR. LAUF: So, hello, everybody. Once
97

1 again, my name is Dan Lauf, and I'm with D&R

2 International.

3 I'll be talking about the Department of

4 Energy's assessment of the market for battery

5 chargers and external power supplies. As we can

6 see, this is the first of, the first analysis that

7 we'll be talking about, and it feeds into the

8 remainder of the analyses that you'll hear about

9 today.

10 Inputs for this analysis are 

11 stakeholder comments and published data, published

12 reports, as well as some of DOE's estimates and

13 analyses.

14 So, the purpose of the market

15 assessment is to analyze consumer end-uses of BCs

16 and EPSs to characterize the markets for BCs and

17 EPSs; shipments, lifetimes, and efficiency

18 distributions in the market.

19 DOE also analyzes trends 

20 that may affect the market for consumer end -uses

21 for BCs and EPSs. So, first, it's important to

22 note that BCs and EPSs are typically packaged with

23 end-use consumer products.
98

1 So, in order to better understand the

2 market for BCs and EPSs it is important to

3 understand the shipments, lifetimes, and other

4 characteristics of these EPSs, or of

5 these costumer applications, as well as power

6 requirements.

7 DOE identified approximately 80

8 applications that use BCs or EPSs. These are in

9 Appendix 3-A of the TSD, and the full list is also

10 available in the handout that you have.

11 It's titled "Battery Charger and

12 External Power Supply Application Data Sources."

13 DOE has also identified a number of

14 market trends, some of which it has taken into

15 account in the preliminary analysis, and some of

16 which it is considering taking into account in the

17 NOPR stage of the rulemaking.

18 The first is the GSM Association's

19 Universal Charging Solution. This is for mobile

20 phone external power supplies.

21 The Universal Charging Solution

22 will, in effect, standardize power supplies for

23 mobile phones. It's a voluntary agreement, but 27
99

1 of the largest mobile phone manufacturers and service providers

2 have already signed on and agreed to do this.

3 It will standardize these EPSs to

4 five-volt output USB EPSs. This will take effect

5 in 2012.

6 And DOE feels it will it extend the

7 lifetime for EPSs, and consequently reduce

8 shipments. Two other applications that DOE is

9 considering analyzing separately in the NOPR stage

10 analysis -- It has not 

11 yet done this in the preliminary analysis -- are

12 smart phones and tablet PCs.

13 These are two relatively new and

14 emerging applications that are rapidly gaining in,

15 or rapidly gaining popularity. DOE expects that

16 certain characteristics will differ from mobile

17 phones and notebook computers respectively, such as

18 potential lifetimes and usage.

19 So, this slide displays the top 20

20 applications by shipments that DOE analyzed, along

21 with their lifetimes. Now, lifetimes are, those

22 are one of the characteristics that DOE understands

23 in terms of the applications that they power.
100

1 This is because, for the most part, BCs

2 and EPSs are intended to outlast the consumer

3 applications that they power. So, once the

4 consumer application fails or is replaced, the

5 EPS or BC that powers that application is replaced

6 as well.

7 So, the one exception here, as I

8 alluded to earlier, is for mobile phones. 

9 The typical mobile phone lasts two years, and this

10 is driven by the Service Contract of the mobile

11 phone.

12 Now, DOE does believe that the battery

13 charger will be replaced when the mobile phone is

14 replaced. However, since the GSMA Universal

15 Charging Solution will take effect prior to this

16 Standard taking effect, DOE believes that the

17 lifetime for the EPS component of the mobile phone

18 will last for more than lifetime of two mobile

19 phones.

20 So, rather than two years, the EPS

21 lifetime will be four years, and shipments will

22 effectively be halved for the EPS component.

23 MR. BROOKMAN: Ric?
101

1 MR. ERDHEIM: Ric Erdheim, Philips.

2 Did you just list MP3 players twice by

3 mistake, or were you trying to suggest something

4 else?

5 MR. LAUF: Oh, yes, there may

6 have been a mistake.

7 MR. ERDHEIM: Okay, that's fine.

8 MR. LAUF: And it's possible one of

9 those may be MP3 speaker docks or one of those.

10 MR. ERDHEIM: Okay.

11 MR. LAUF: Yeah, it was a mistake.

12 MR. BROOKMAN: Docking station.

13 MR. LAUF: Docking stations. Thank you.

14 MR. BROOKMAN: Okay. Thank you. Keep

15 going.

16 MR. LAUF: This next slide

17 summarizes 2008 battery charger shipments. In

18 total there were 402 million battery chargers

19 shipped in 2008 that DOE identified.

20 As you can see, the largest product

21 class is Battery Charger Product Class 2. These are low-energy low22 voltage battery

23 chargers. Battery Charger Product Class 4, which
102

1 are low-energy high-voltage, and Product Class 8,

2 which are USB-input battery chargers are also

3 significant applications, or are also significant

4 product classes.

5 Here we can see the top ten applications

6 by shipments, by BC shipments. Again, there were

7 402 million battery charger shipments in 2008, and

8 the most significant application in terms of

9 shipments were mobile phones.

10 There were approximately 130 million

11 that shipped. The majority of these were in

12 Product Class 2, although there are a growing

13 contingent for mobile phones that fall under Class

14 8.

15 Again, these are USB battery chargers,

16 and this is driven primarily by Smart Phones. DOE

17 does expect that this Product 8 category will grow

18 as Smart Phones grow in popularity.

19 MP3 players are the more significant application for

20 Class 8, and notebooks and power tools fall under

21 Battery Charger Product Class 4.

22 Here we have 2008 shipments for external power

23 supplies.
103

1 This includes Class A and non-Class A

2 power supplies here. As we can see, there are 367

3 million external power supplies that shipped in

4 2008.

5 The largest proportion are for Product

6 Class A1, and DOE, for analysis purposes,

7 subdivided Product Class A1 by wattage. So, those

8 subdivisions are also shown here.

9 Product Class A2 is also a relatively

10 significant product class in terms of shipments.

11 There were very few AC-to-AC external power

12 supplies that DOE identified.

13 And non-Class A, the shipments are

14 relatively small. And I'll discuss those a little

15 bit later as well.

16 So, here we have the top ten

17 applications by external power supply shipments

18 in 2008.

19 (Whereupon, at 10:58 a.m. ET, Mr. Albert

20 and Mr. Erdheim conferred, out of the hearing of

21 others and off the Record, during which the

22 following occurred:)

23 MR. LAUF: Once again, the most
104

1 significant application in terms of shipments was

2 mobile phones. There were approximately 130

3 million that DOE identified.

4 Now, you'll note that this number is not

5 what DOE used for the analysis, and once again this

6 is because DOE assumes that this number will be

7 halved due to the GSMA Universal Charging Solution.

8 So, DOE did take that into account in the

9 preliminary analysis, and used approximately 65

10 million shipments.

11 And, as you can see, the majority of

12 applications did fall under Product Class A1 as

13 well as Product Class A2.

14 Here we have non-Class A shipments in

15 2008. Just to recap, non-Class A EPSs include

16 multiple-voltage EPSs, medical device EPSs for

17 medical applications and MADB applications, as

18 well as high-powered EPSs.

19 And high-powered EPSs are primarily for

20 amateur radios. Multiple-voltage EPSs also have been divided

21 into two separate product classes, low-wattage power

22 EPSs, or, sorry, low-wattage multiple-voltage EPSs.

23 The application that DOE identified were
105

1 Hewlett-Packard multi-function devices, and HP has

2 indicated to DOE that it plans on using Class A

3 EPSs in the near future.

4 So, DOE is considering shifting these

5 shipments to Class A EPSs from non-Class A in

6 the NOPR stage. Higher wattage multiple-voltage EPSs are

7 primarily EPSs of higher wattage, are primarily

8 EPSs for the Xbox 360 by Microsoft.

9 Once again, the only

10 application that DOE has identified for

11 high-powered EPSs are EPSs for amateur radios.

12 Now, DOE initially assumed that five

13 percent of wall adapters for MADB applications

14 can be defined as external power supplies. DOE has

15 since adopted the ENERGY STAR definition of an

16 "external power supply," and believes that under

17 this scope, MADB EPS shipments may, in fact, be

18 higher.

19 We do have MADB applications listed on

20 this slide, and at this point you are welcome to

21 comment on the percentage of wall

22 adapters that, under the ENERGY STAR definition,

23 would be considered external power supplies. And,
106

1 you are also welcome to submit comment, of course,

2 later on in writing.

3 MR. MORRIS: Doug?

4 MR. BROOKMAN: Yes, Wayne.

5 MR. MORRIS: Back up maybe to the

6 question box that you've got there. I guess that's

7 a pretty difficult question to ask in the

8 aggregate.

9 I mean, there are a lot of different

10 categories of motor-operated and detachable battery

11 products, and so are you asking product category by

12 product category? In other words, by, for, for all

13 cordless rechargeable vacuum cleaners, what

14 percentage of the wall adapters, then, meet an EPS

15 definition?

16 MR. LAUF: I would assume that's the easiest way for you to 

17 put

18 together your answer, wouldn't it be?

19 MR. MORRIS: I guess. I mean, I'm

20 still stuck with the problem about the

21 shipment number.
107

1 Were you going to get shipment numbers

2 later, or are you going, or is that part of what

3 you just did?

4 MR. LAUF: That's part of what I just

5 did under the specific --

6 MR. MORRIS: Okay. In the Technical

7 Support Document there is, there are estimates made

8 of the shipments of products within a particular

9 category of product, like, you know, -- I used

10 vacuum cleaners. I'll stay with vacuum cleaners.

11 It's a cordless, rechargeable, hand-held

12 vacuum cleaner. There's an estimate number of

13 shipments for those external power supplies, and

14 that's an ex-, there's an-, ship, annual estimate

15 of shipments of battery chargers.

16 The numbers are not the same. How did you do that?

17 MR. LAUF: Sure. And there

18 are two nuances to take into account here.

19 The first is that even if it's an

20 exclusive battery-charged application, not all of

21 those battery chargers may be powered by wall

22 adapters. And if that were the
108

1 case, then DOE made an

2 assumption there, looking for data on the

3 number of those batteries that would be

4 powered by a wall adapter.

5 And then, once again, not all of those

6 wall adapters may be defined as an external power

7 supply.

8 MR. MORRIS: Well, yeah. I guess you,

9 on that one, -- This is Wayne again.

10 I'm sorry. You're saying that if it has a wall adapter,

11 then it's counted only as an EPS and it's not

12 double-counted in the number for a battery charger.

13 You're shaking can your head "no." So, I'm --

14 MR. BROOKMAN: Ari?

15 MR. REEVES: Sure. I think there are

16 potentially four different numbers.

17 The largest possible number which you,

18 you may see in the TSD, but only, but not by

19 design, is the number of the total shipments of the

20 application itself, regardless of the presence of

21 the BC or EPS. In no cases did we put that in a
109

1 document because we're just looking at BCs and

2 EPSs.

3 The BC part, you'll find it's the second

4 largest number. If there's a battery there, then

5 there's a battery charger.

6 Okay? That's the second number.

7 Then the third number, which, again, is

8 not in the document, is the number of wall

9 adapters. This could overlap with

10 battery chargers, right?

11 Some of the battery charged models

12 incorporate a wall adapter and some don't, okay?

13 Then the fourth number, which is going

14 to be the smallest number, is the number of EPSs.

15 In some cases all of the wall adapters are EPSs,

16 but in the case of these MADB applications we

17 carried forward the, the assumption from the

18 determination about the fraction of wall adapters

19 that are EPSs, specifically, five percent.

20 And that's why you'll see very small

21 EPS counts for the MADB applications

22 in the Preliminary Analysis.

23 MR. BROOKMAN: Go ahead.
110

1 MR. ALBERT: Larry Albert.

2 So, what's happening here is that wall

3 adapters that are used as part of battery chargers

4 are, are counted, or could be counted twice, right?

5 Counted as EPSs, and could be counted as battery

6 chargers.

7 And those counts are used for the

8 estimate of energy, hybrid energy savings?

9 MR. REEVES: That's right. And so the,

10 the estimates of aggregate energy savings are not

11 additive.

12 Admittedly, overlap the BC and EPS

13 energy-savings estimates.

14 MR. ALBERT: Right. Thank you.

15 MR. BROOKMAN: Michael.

16 MR. VLADIMER: This is Michael. Just to

17 speak to Wayne's point, because I think you're

18 touching on a challenge that DOE's been dealing

19 with from the beginning of this, and, and just to

20 make sure that everyone understands what that

21 challenge is, people don't buy BCs and EPSs.

22 People buy actual products. And so it

23 might seem counterintuitive that there are four
111

1 numbers, as Ari was saying, for shipments because

2 DOE's taking these BCs and EPSs that are used with

3 applications and teasing out that they apply to

4 these BC and EPS criteria that these, DOE is tasked

5 with regulating.

6 So, I think a common theme throughout

7 the day is going to be: How do we go from the

8 application side, which most people think of when

9 they think of these products, to how we tackle that

10 from the BCs or EPS perspective?

11 So, if something doesn't seem intuitive

12 for that reason, just let us know and somebody on

13 the team will try and answer your question.

14 MR. MORRIS: Wayne Morris.

15 Thanks, Michael. And, believe me, I do

16 understand your dilemma with this.

17 But, when we get to the actual -- I know

18 I'm jumping ahead here, and I apologize. But,

19 this, this is important to, as the foundation from

20 which we then go forward and look at the amount of

21 energy savings.

22 If we don't get this right, then the

23 energy savings is either inflated or deflated
112

1 accordingly. And it seems that with the, with this

2 sort of double accounting that's going on here,

3 we're going to be estimating energy in both states.

4 And I, I guess maybe I'm an old dinosaur

5 here, but double-counting of energy savings just

6 doesn't inherently seem like the right thing to do.

7 MR. PETROLATI: Right. So --

8 MR. BROOKMAN: Vic Petrolati.

9 MR. PETROLATI: Vic Petrolati with the

10 Department of Energy.

11 First of all, we stated within the

12 document that we were aware of this dilemma. We

13 did, already, some initial analysis associated with

14 this particular case, and found that the savings

15 may be reduced, I think for battery chargers, by

16 something in the area of possibly 20 percent.

17 I'll have to go back to our analysis.

18 But, we do fully realize this is an issue.

19 To do a detailed analysis on this

20 requires a lot of numbers that we obviously do not

21 have at this point. So, we have done a very

22 careful sensitivity analysis, and didn't find that

23 it really made a huge difference in terms of
113

1 savings.

2 But, I agree with you that we have at

3 this point accounted for additional savings that

4 need to be in some manner subtracted out. I'm not

5 sure we have got enough data to actually subtract

6 it out extremely well, but from a rough standpoint

7 we do not feel it's a big problem.

8 MR. BROOKMAN: Yes, Wayne.

9 MR. MORRIS: I agree with you, Vic.

10 Thanks for clarifying that.

11 And I guess we would also agree that in

12 the days of the motor-operated and detachable

13 battery, this is a very, very small percentage of

14 the overall amounts of, of products that

15 we're dealing with in comparison to hundreds of

16 millions of cell phones and laptop batteries.

17 We're a fly speck on the wall here.,

18 and -- But, that said, it's important so that

19 we don't overestimate a category to where we then

20 add to that candidate standards level to where it

21 makes it look as if we're going to save more energy

22 going to higher CSL than which we really won't.

23 And so it, it is important. And it's
114

1 also important within certain categories.

2 You know, The Department -- And I

3 understand why -- has cut these things both

4 horizontally and vertically.

5 They've cut them horizontally, if you

6 will, across, you know, broad categories, like low

7 energy and high voltage and those type of

8 situations. And then they cut them against the,

9 vertically, in other situations by virtue

10 of the actual product that

11 they're used with.

12 And in some of those categories, and as

13 we've mentioned earlier, that there is pretty broad

14 range of product within that category in terms of

15 both the energy usage and in terms of the savings

16 potential for those particular products. And so I

17 think that, you know, if we can get to better

18 numbers, we would like nothing better.

19 And so if there's something that we can

20 do, --

21 MR. PETROLATI: Same here. Right.

22 MR. MORRIS: -- helping, I hope the

23 Department and its consultant will just ask us. If
115

1 we can help with that situation, we'll be glad to

2 try.

3 MR. PETROLATI: We have an open

4 invitation to help us get those numbers.

5 MR. MORRIS: Depends on what number you

6 want.

7 MR. PETROLATI: But, we agree with that.

8 Yeah. Thank you.

9 MR. BROOKMAN: Okay. Thank you.

10 MR. LAUF: Yeah, thank you for those

11 comments. And so on this slide we have two further

12 requests for comment.

13 One is a little more general. And DOE

14 does seek comment on its estimates of the Class A and

15 non-Class A and EPS shipments and lifetimes for

16 each application and/or each product class.

17 And DOE does also want to, or is

18 considering analyzing consumer applications

19 that are used in the commercial sector, such as

20 mobile phones or laptop computers, for example.

21 And, DOE seeks comment on which BC and EPS

22 applications can be used or are used in the

23 commercial sector, and the share of shipments that
116

1 go to the commercial sector.

2 DOE also seeks comment on how other

3 characteristics, such as usage and lifetime, differ

4 in the commercial sector.

5 MR. BROOKMAN: Responses to these

6 comment boxes?

7 (Whereupon, at 11:12 a.m. ET, Mr. Morris

8 and Mr. Albert conferred, out of the hearing of

9 others and off the Record, after which the

10 following occurred:)

11 MR. BROOKMAN: Wayne? Wayne Morris?

12 No?

13 Okay, we're going to move on then.

14 MR. LAUF: Okay. So, the final

15 component of the market assessment is the

16 determination of baseline efficiency distributions.

17 So, these are the efficiency

18 distributions. And the purpose of this is to

19 characterize the distribution of efficiencies in

20 the market in order to allow DOE to better assess

21 the impact of standards.

22 Efficiency distributions were based on

23 product tests, both from DOE and from Pacific Gas
117

1 and Electric. And DOE based product class

2 efficiency distributions on these

3 product tests.

4 So, it looked at the distribution of

5 efficiencies across the tested products, and then weighted these by 

6 shipments. So,

7 here we have 2009 battery charger efficiency

8 distributions.

9 And, as we can see, approximately 40 to

10 50 percent of BCs that were shipped in 2009

11 fell under the baseline category, while the

12 remainder were more efficient. And this does vary

13 by product class.

14 MR. ALBERT: Question.

15 MR. BROOKMAN: Yes. Please, Larry.

16 MR. ALBERT: For the Product Class 4,

17 which, of course, is the one I'm most interested in

18 here, the two categories that comprise

19 that class are essentially power-tool battery

20 chargers and battery chargers for laptops and other

21 computers and so on.

22 Do you have any sense of what the

23 distribution is of the efficiencies with respect to
118

1 those two classes of products within the, the

2 product class?

3 MR. LAUF: Not offhand.

4 MR. ALBERT: All right.

5 MR. PETROLATI: Are you going to be

6 presenting that later?

7 MR. LAUF: Yes. Actually, I am.

8 MR. BROOKMAN: Mike Rivest (phonetic).

9 MR. RIVEST: That information is

10 actually in the TSD. You can see that the

11 engineering analysis it has at the CSLs, it has a,

12 applications I believe that you're --

13 MR. MORRIS: Okay. Thank you.

14 MR. LAUF: And on this side we have

15 efficiency distributions for Class A and non-Class

16 A EPSs. I do want to point out there is an

17 error that I thought was caught, but the green

18 CSL for Class A EPSs should read "ENERGY STAR," not

19 "Intermediate."

20 So, those two should be switched. The

21 numbers here are correct.

22 So, for Class A EPSs, as we can see,

23 approximately 68 percent of Class A EPSs just meet
119

1 the EISA criteria, while the remainder are at the

2 ENERGY STAR level or more efficient.

3 For non-Class A EPSs, for

4 multi-voltage and for high-powered EPSs, DOE based

5 these energy distributions off the distributions

6 that it calculated in the Determination Analysis.

7 Now, as I mentioned, DOE expects that

8 low-wattage multi-voltage EPSs are

9 a small and shrinking category.

10 For medical device EPSs and EPSs for

11 MADB classifications, these are based off the Class

12 A efficiency distribution with the assumptions that

13 ten percent fall below the current EISA Standard

14 for Class A.

15 MR. BROOKMAN: Wayne.

16 MR. MORRIS: Wayne Morris.

17 Just a point to make sure in terms of

18 the MADB category.

19 (Whereupon, at 11:16 a.m. ET, Mr.

20 Petrolati and Mr. Reeves conferred, out of the

21 hearing of others and off the Record, during which

22 the following occurred:)

23 MR. MORRIS: I think it would be a bit
120

1 of a stretch to assume that the percentages of the,

2 of the 17 percent, for instance, and above, mean

3 that that's the percentage of the marketplace. A

4 number of manufacturers in our industry that have

5 long questioned, if you will, the value of, of

6 ENERGY STAR in this category.

7 I mean, some companies see this as being

8 a benefit. Some participate in it, but it

9 does not mean, therefore, that automatically, for

10 instance, that of, of the entire marketplace, for

11 instance, 17 plus 12 plus 3 is what the marketplace

12 is.

13 And I think it would mean that that

14 perhaps is the number of companies that have taken

15 advantage of that situation. Is that correct?

16 MR. LAUF: No, these were based off of

17 product testing, not off of --

18 MR. MORRIS: And I guess we

19 would expect that number to be actually larger than

20 what you're showing there.

21 MR. PETROLATI: I'm sorry, Wayne. I

22 apologize.

23 Which number? The 68 percent?
121

1 MR. MORRIS: No, the MADBs, that 10 plus

2 58 being below the ENERGY STAR line.

3 MR. PETROLATI: Okay.

4 MR. MORRIS: We think that that's

5 actually too high, and the, the number from 17 and

6 above is actually greater than that. I think that

7 there are -- And that's because I think that there

8 are a lot of very small categories of products that

9 you may or may not have picked up in your survey

10 for which they probably do apply, but I think they

11 don't necessarily show up in this situation.

12 MR. BROOKMAN: Wayne, does AHAM

13 gather that data?

14 MR. MORRIS: No, we don't. it's

15 strictly --

16 MR. BROOKMAN: Okay.

17 MR. MORRIS: -- voluntary.

18 MR. LAUF: Okay. Thank you.

19 And, and DOE does believe, also, that

20 this, the share of products that fall within CSL zero for medical devices, 

21 or for medical and MADB EPSs, DOE also believes that

22 that is a small and shrinking category.
122

1 And I'll take any other questions, and

2 that's the end of the presentation. So, thank you.

3 MS. PORTER: This is Suzanne Porter from

4 ECOS. I just had a clarification question.

5 MR. LAUF: Sure.

6 MS. PORTER: And I know this is prob- --

7 This in the TSD, but for the purposes of looking

8 at this illustration, how did the CSL levels for

9 non-Class A EPSs translate to the Class A EPS

10 levels that are shown immediately above?

11 MR. LAUF: Well, actually,

12 we'll have a discussion

13 about the CSLs in a lot more detail later on --

14 MS. PROTER: Okay.

15 MR. LAUF: -- in the presentation.

16 MR. BROOKMAN: We're going to proceed,

17 then.

18 MS. PORTER: I have one more question.

19 The baseline -- You can use baseline a lot of

20 different ways.

21 So, my other clarification question was:

22 For the purposes of the energy analysis, was the

23 baseline the baseline or lowest efficiency product
123

1 used -- I know the baseline for EPS Class A was

2 EISA, but were all savings calculated against the

3 baseline for the battery charger the lowest

4 efficiency levels, or CSL zero?

5 Or maybe we should save that question

6 for later.

7 MR. LAUF: And that's something we also

8 might answer later on.

9 MS. PORTER: Okay. My apologies.

10 Thank you.

11 MR. BROOKMAN: Let's proceed.

12 Michael Vladimer.

13 TECHNOLOGY ASSESSMENT AND SCREENING ANALYSIS:

14 MR. VLADIMER: Ari raised this. This

15 has happened to me more than once in these

16 presentations.

17 MR. PETROLATI: We'll have to reverse

18 the order.

19 MR. VLADIMER: No. Good morning.

20 Michael Vladimer from Navigant

21 Consulting. 

22 I'm here to talk about the technology

23 assessment and the screening analysis that DOE
124

1 performed, and then we'll go to lunch.

2 So, again, the diagram that shows the

3 flow of the analyses. And we're still at the

4 beginning here at the technology assessment.

5 So, the role of the Technology

6 Assessment is to examine the factors that affect

7 the efficiency of battery chargers and external

8 power supplies. There's going to be three parts

9 that we talk about.

10 First is product classes; then efficiency

11 metrics, how we measure the efficiency of these

12 products; and then finally, technology options,

13 what specific options do manufacturers have to

14 improve the efficiency of the, these BCs and EPSs.

15 As noted on the previous slide, Chapter 3 has a

16 lot more detail if anyone's interested.

17 So, product classes. The main

18 purpose for establishing product classes is to

19 maintain product utility.

20 There's statutory criteria that explain exactly the

21 criteria that DOE has to consider. Essentially

22 the goal of product classes is to maintain utility.
125

1 So, for example, one of the product

2 classes is for inductive battery chargers. The

3 idea is that inductive battery chargers give us 

4 safety in a wet environment such as when using a

5 toothbrush.

6 And that has a unique utility. That's why

7 DOE examined that on its own.

8 So, using these criteria, DOE examined

9 product classes for EPSs and BCs. And I'll start

10 by listing these different criteria.

11 So, there's a number of criteria that

12 are common to EPSs and BCs. That's why they're

13 grouped together.

14 Those are output power, output voltage,

15 output cord length, something that affects their

16 efficiency. There are certain characteristics that

17 stakeholders raised during the framework document.

18 In their public comments they suggested

19 that DOE look at usage and topology and price.

20 However, those three characteristics do not meet

21 the statutory criteria, so DOE couldn't use them.
126

1 Then there's a few that are unique to EPSs, whether

2 or not it's Class A, output voltage, output power, AC

3 or DC output; if it's being designed specifically for

4 medical or MADB, which refers to motorized

5 application and detachability batteries.

6 And then there's a number of

7 characteristics that are unique to battery chargers:

8 battery energy, battery voltage, battery capacity,

9 chemistry of the battery,

10 charge rate, whether or not there's inductive

11 coupling; and cord-cordless operation.

12 MR. BROOKMAN: Ric.

13 MR. ERDHEIM: Hi. Ric Erdheim with

14 Philips.

15 So, on Slide 54 -- Go back one slide,

16 Michael.

17 MR. VLADIMER: Sure.

18 MR. ERDHEIM: It's Number 3. Says, "any

19 other performance-related features that will

20 require different standard levels...." So, related

21 to that, why did you delete usage, topology, and

22 price?

23 You said it was deleted because
127

1 of statutory limitations, but the Statute gives you

2 broad authority to use any features that would

3 affect energy use. I don't know if you're the

4 right person to ask.

5 I'll just ask generally.

6 MR. BROOKMAN: Michael Kido.

7 MR. KIDO: I just need some

8 clarification on that. What --

9 MR. ERDHEIM: So, Michael said on the

10 next slide, the second, second column,

11 characteristics not considered due to statutory

12 limitations. And there's three listed.

13 And I'm wondering what the statutory

14 limitations were, given the previous

15 slide, Factor 3, which says any other

16 performance-related features that require different

17 standard levels. In other words, I don't

18 understand what the statutory limitation was to

19 lead to the elimination of one or more of those

20 factors, given the broad authority that the

21 Department's given.

22 MR. PETROLATI: Ric, can I ask the

23 question just from the question of your personal
128

1 interests? What feature is it that you want

2 considered that we didn't consider as part of it,

3 our evaluation criteria?

4 MR. ERDHEIM: Well, in terms of setting

5 up the classes, I'd say the period of time

6 that the product is plugged in.

7 MR. PETROLATI: Period of time the

8 product is plugged in.

9 MR. VLADIMER: Which is part of the

10 usage.

11 MR. PETROLATI: Okay, does that work --

12 Is that -- Do we have to establish a product class

13 based on usage, Mike?

14 MR. VLADIMER: It doesn't. We're

15 talking about external power supplies, right?

16 MR. PETROLATI: Battery-powered systems;

17 yes.

18 MR. KIDO: Well, external power

19 supplies. And I think you're right, that there is

20 some, some availability, yes, some flexibility

21 there.

22 Battery chargers ultimately, I don't see

23 anything with battery chargers. 
129

1 --

2 MR. ERDHEIM: So, in answer to your

3 question. I'll --

4 MR. BROOKMAN: Back to Ric. Go ahead,

5 Ric.

6 MR. ERDHEIM: I'm sorry. So, the

7 concern is: Why didn't you -- Having

8 identified 58 different classes or products with

9 battery chargers, and about a-third of them are rarely

10 plugged in, why didn't you establish a category

11 for those products?

12 MR. PETROLATI: And, again, "rarely

13 plugged in" doesn't seem to be a consumer utility

14 or a specific feature, in my mind, where we would

15 have to establish a, a separate product class based

16 on the legislative language.

17 MR. ERDHEIM: Let's not get into whether

18 you had to. The question is, you had the

19 discretion.

20 MR. PETROLATI: 

21 The question is: Do we have to,

22 based on legislative language?

23 MR. ERDHEIM: Right.
130

1 MR. PETROLATI: I think we do have an

2 ability to establish more categories, but I need to

3 talk to our Counsel.

4 MR. ERDHEIM: Yeah. And I'm not trying

5 to get you --

6 MR. PETROLATI: Yeah.

7 MR. ERDHEIM: But, if you go to the

8 next, the reason I asked is, again, the Column 2

9 says we couldn't consider this due to statutory

10 limitations. And that's what I, I don't

11 understand.

12 And maybe you could have, but you

13 decided not to. But, this says you couldn't.

14 MR. PETROLATI: Yeah. I think you've

15 got a point.

16 We'll have to take a look at that.

17 MR. KIDO: Yeah, I'll have to take a

18 look at that, because --

19 MR. ERDHEIM: Again, just to emphasize

20 the point again, -- Ric Erdheim from Philips. --

21 if the product is not plugged in, or rarely plugged

22 in, or infrequently discharged, whatever you, you

23 want, --
131

1 MR. PETROLATI: Let's call that the "usage

2 characteristic."

3 MR. ERDHEIM: "Usage."

4 MR. PETROLATI: Right.

5 MR. ERDHEIM: --

6 -- Your energy savings are going to be very minimal

7 at best.

8 MR. BROOKMAN: Do you wish to comment?

9 MR. MORRIS: No, I don't.

10 MR. BROOKMAN: Tim Ballo.

11 MR. BALLO: Tim Ballo, with

12 Earthjustice.

13 It strikes me that that's an incorrect

14 interpretation of the law, that the feature, --

15 (Whereupon, at 11:28 a.m. ET, Mr. Kido

16 and Mr. Petrolati conferred, out of the hearing of

17 others and off the Record, during which the

18 following occurred:)

19 MR. BALLO: -- the feature in question

20 would have to be a feature of the battery charger.

21 We seem to be discussing a feature of the user of

22 the end product to which the battery charger is

23 connected.
132

1 It just seems irrelevant to the question

2 of the actual performance characteristics of the

3 charger itself.

4 MR. BROOKMAN: Please say your name.

5 MR. SWOPE: Toby Swope. Just to

6 clarify, in our approach, when you were looking at

7 utility, it was in terms of the function that the

8 device provided to the consumer.

9 So, say you needed to have a USB input

10 or you needed to have mains input. Those are

11 different utilities.

12 If we had to set a standard or a product

13 class and it changed that utility so that you could no

14 longer plug into USB to get power that would

15 be something that you would distinguish product

16 classes between, whereas usage, it really doesn't,

17 it only affects how much you're using the

18 product. It doesn't affect the way you're using

19 the product.

20 See, you always turn on your laptop the

21 same way. You always plug in your shavers the same

22 way.

23 MR. PETROLATI: And, Ric, going back to
133

1 --

2 MR. BROOKMAN: Vic Petrolati.

3 MR. PETROLATI: Sorry.

4 Ric, going back to your statement, we

5 need to take a look and see if that language is

6 actually correct. I don't believe we have a

7 statutory classification saying we cannot establish

8 a category based on those limits.

9 MR. BROOKMAN: Yes, please, --

10 MR. ALBERT: Just a follow-on question to

11 Toby.

12 MR. BROOKMAN: -- Larry.

13 MR. ALBERT: Sorry. Larry Albert.

14 Toby, if there's an associated cost

15 associated with a utility, then

16 presumably that utility is selected by the

17 consumer at a higher price point

18 because of their perceived benefit.

19 Right? The concern here is in

20 those situations where something might be perceived

21 as being of a greater utility, is it

22 necessarily appropriate for evaluations that

23 derive greater utility to be automatically
134

1 considered to be acceptable?

2 And, because you're saying

3 specifically, I think, price cannot be included as

4 one of the criteria.

5 Right? But, price is often associated

6 with utility.

7 Right? So, in that indirect way, price

8 could be considered, right?

9 MR. BROOKMAN: Toby.

10 MR. PETROLATI: Toby's not the right

11 person. We need a legal response to that.

12 I'm not sure we're ready for that. But,

13 it is a question that's very interesting.

14 I've got it in other Rules, whether or

15 not price can be considered in utility, so that's

16 something we need to respond to.

17 MR. BROOKMAN: It's well raised.

18 Dan?

19 MR. TENINTY: Daniel Teninty, again,

20 Wireless Power Consortium.

21 Along the same line of questioning

22 topology, certainly from a wireless power

23 consortium perspective, very much weighs into the
135

1 question of whether or not you can consider the

2 topology as a criteria, because one of the

3 characteristics of inductive power coupling,

4 excluding toothbrushes, is that the voltage level,

5 because of the resonant circuit that's often

6 involved is much higher than the input voltage to

7 the device.

8 And so the definitions so far

9 have been offered would kind of exclude these

10 products from consideration just by that

11 definition, and would be neither a battery charger

12 nor an external power supply, which is probably

13 okay with a lot of product manufacturers. But --

14 MR. PETROLATI: Yeah, please, Mike.

15 Yeah. After --

16 MR. TENINTY: So, just wanted to kind of

17 raise that same point that Philips and Black &

18 Decker raised.

19 MR. PETROLATI: Same.

20 MR. BROOKMAN: Mike Rivest. Turn it on,

21 Mike.

22 MR. RIVEST: This is Mike Rivest,

23 Navigant Consulting.
136

1 I'm not a lawyer, and this is not a

2 legal opinion. It's merely reflecting on 16 years

3 of proceedings, and how product classes have been

4 handled.

5 I think the starting point here is

6 that product classes are established to make sure

7 that we're not eliminating from the market products

8 that the consumer would perceive as desirable. So,

9 for example, I remember a proceeding where the

10 efficiency standard was so stringent that the only

11 way to get there would be to eliminate the window

12 on an oven.

13 That would, you know, was determined

14 that the, the window provided a utility, and

15 if the only way to get there was to remove the

16 window, that warranted a separate product class for

17 ovens with windows with glass.

18 You could think of the same thing of car

19 standards where you don't compete a subcompact with

20 an SUV because if you were to set the standard so

21 stringent that not a single SUV could be sold on

22 the market, you know, that warranted a separate

23 product class.
137

1 So, it's true that DOE

2 creates classes to isolate those applications

3 that were at risk because they couldn't meet the

4 Standard. In every proceeding I've been involved

5 with, price has never been an issue for product class

6 because we inherently take into account price in

7 the economic analysis, okay?

8 And there's something called the safety

9 provision as well, which is related to product

10 utility. So, if you frame it that way, it starts

11 to answer some of these questions.

12 And I think, from what I have heard

13 today, for the first time is turning it around,

14 saying: Is there anything preventing us from

15 having more classes? Frankly, I've never

16 heard that.

17 I mean, there has to be a reason that

18 you would create a class. In the past what's been

19 applied is you create a class when, if you don't

20 create that class, you eliminate products.

21 Now, for the end user

22 for example, the window, is important. Whether

23 they use it one hour or 20 hours a week is an
138

1 economic issue.

2 We're not

3 making them use 20 hours or one hour a week. We

4 take that into account in the process.

5 So, I don't see how usage profile

6 could be used as a way of creating a product class.

7 Of course, I'm not the lawyer.

8 MR. BROOKMAN: Okay.

9 Yes, Vic. Larry, and then Ric.

10 MR. ALBERT: So, in, in response to

11 that, I guess I'd like to throw out an example.

12 So, if I have, if I have a rechargeable beard and

13 mustache trimmer that the larger volumes are sold

14 at the, let's say, the $15 range because that's

15 what many consumers can afford, and

16 that's what their lifestyle allows them to afford,

17 and then you come along with a Standard

18 requirement that forces you to put X amount of

19 dollars of circuitry into it to make that Standard,

20 and so now that product goes from an average, you

21 know, of a median-class retail of 15, to $24,

22 aren't you eliminating a product class?

23 Or, I mean, aren't you taking away the,
139

1 the effective utility of the consumer to be able to

2 buy that product at the price that they were

3 normally buying at? I'm taking all this into consideration,

4 that at the end of the day there was no difference

5 in energy savings between, or no significant energy

6 savings between the one that was $15 and the one

7 that now costs $24.

8 MR. RIVEST: So someone will say the

9 whole point of the Standards Program is to, you

10 know, nudge consumers towards more efficient

11 products by doing an economic analysis for them.

12 And then in your example there would be an economic

13 analysis that would show that the $24

14 shaver will save them money over the life of that

15 product, and that's where the Standard is

16 established.

17 Now, the Department does consider the

18 fact that some consumers use the shaver more than others, and

19 that a portion of the of the users will

20 actually see increases in life-cycle cost. And

21 that's something that's considered and is weighed

22 in the decision.
140

1 So, it's not ignored, but it's not a,

2 like a hard rule that we can't raise price, because if

3 that was the hard rule there would be no program.

4 MR. ERDHEIM: Just one quick thought.

5 MR. BROOKMAN: Please. Yes.

6 MR. ERDHEIM: Ric Erdheim.

7 And Vic understands the issue. I'm not

8 going to belabor it.

9 But, I'd just say that this, Vic's got

10 an impossible job, in my view, in this, because

11 unlike all the other Regulations that we talked

12 about, they dealt with products. They might be

13 different types of products, but they dealt with a

14 product.

15 This is dealing with a component of

16 multiple products, and that's what makes this so,

17 so difficult. That's why, you know, you've got

18 1,000 pages of documentation to try to go through

19 all of this, and I -- Believe me.

20 I question whether we should have

21 started down this road because of the

22 difficulty of this. But the point that I'm

23 making is that the Department's analysis went through usage for 57 

24 products, and 18 of
141

1 them were unplugged 23 hours out of the 24 hours.

2 And that's pretty significant. And,

3 again, as the example, I don't know if you

4 were here when I used my beard trimmer

5 example.

6 My beard trimmer is not plugged in one

7 hour a day, and I can't imagine any that is plugged

8 in. So, the point is that the energy

9 savings potential of that product is completely

10 different than the sonic toothbrush we have that's

11 plugged in 24 hours a day.

12 I mean, I cannot agree with the

13 potential, but at least there's a potential. But,

14 if the product is not plugged in, -- And there's a

15 wide range of these battery chargers that your, the

16 Department's analysis shows is not plugged in.

17 And just to take it

18 out of Philips, we don't make camcorders, but I

19 don't know of anyone who has a camcorder that plugs

20 it in hardly ever. You know, you plug it in the

21 day before you need it.

22 So, that's why I'm raising the issue. You're doing this to 

23 save energy, but if the

24 product's not plugged in, you can't save energy.
142

1 MR. RIVEST: Let me --

2 MR. BROOKMAN: Mike Rivest.

3 MR. RIVEST: Thank you for commenting on

4 the difficulty. Literally, you understand it.

5 I appreciate it.

6 Let me tell you what we did in

7 the technical support documents, which will provide

8 information to the Department as it, you know, gets

9 into the mode of making Decisions.

10 So, we

11 created ten product classes, and even having done

12 that, within certain product classes there are

13 applications that have very different usage

14 profiles, probably very different sets of

15 economics, we report the economic results of the

16 product class. But, if you dig deep into the

17 TSD you will see that we also reported application

18 by application.

19 And, you know, we are at

20 the point now of presenting information, not of

21 making decisions. But, perhaps you can look at
143

1 that, this aggregate of information.

2 And I hope it's in the TSD. It is?

3 Okay. And maybe you can make

4 recommendations and say, "Well, maybe the Country

5 would be better off if things that are currently

6 not contemplated as being regulated weren't, because

7 the net effect would be to increase the energy

8 savings, or at least increase the NPV of the

9 Country. Although they fit under the

10 statutory criteria, you know, they weren't

11 regulated."

12 So, this is the first time it happens,

13 this situation. And I don't know what the legal

14 constraints would be, but we always do what's

15 called a subgroup analysis, looking how different

16 types of consumers might be impacted differently

17 from the average.

18 We always do that. So, this just takes

19 it to a whole new level.

20 MR. BROOKMAN: Okay. Additional

21 questions?

22 Wayne.

23 MR. MORRIS: Wayne Morris with
144

1 AHAM. Just a quick comment.

2 Ric Erdheim's point is a very well-taken

3 one, but I also think it's dealt with in the

4 government impact model, the GRIM analysis that is

5 done, where you would look at the effect of

6 Regulation on the marketplace as well, and the

7 manufacturers.

8 And so I agree with you, Michael, that I

9 think that it's taken up in some of the economic

10 cases as well as in the GRIM, where it would look

11 at, for instance, products would drop off the

12 marketplace with that compacted number of

13 players and a particular product segment.

14 Would that then have an impact on sort

15 of an antitrust kind of situation with regard to

16 loss of competitiveness and all of which is

17 important to consider, especially on these very

18 high-volume but very small-price type products.

19 Michael.

20 MR. BROOKMAN: Mike Kido.

21 MR. KIDO: Yeah. I’ll just point out that

22 as part of the analysis, once we do issue those

23 parts of the rulemaking, once Justice gets involved,
145

1 we look at potential antitrust situations.

2 I just want to ask a quick follow-up

3 question to the individual from Wahl. With respect

4 to your example where you have the situation where,

5 let's say, you have one kind of shaver and then,

6 you're offering now at a certain price point, and

7 then because of the new Standards you have to

8 increase that price point, are you anticipating

9 that there would be any kind of actual feature of

10 performance changes to that particular model, aside

11 from the energy consumption aspects, or would it

12 still be pretty much the same, with the key

13 difference in the consumer being, I guess, the

14 energy consumption and the price?

15 MR. BROOKMAN: Rick.

16 MR. HABBEN: In our particular product

17 category, in most cases there would not be a user,

18 the user would not see any potential benefit. And just taking that down 

19 further,

20 instead of just taking my word for it, is that, you

21 know, are things to, especially like beard and

22 mustache trimmers.

23 You know, the usage on them is, you
146

1 know, five minutes once a week. So, you

2 don't have to have that much capacity in

3 the battery, and you don't have to have a

4 super-quick charge for the customer to get the same

5 utility as if it takes, you know, 15 hours to

6 charge the battery.

7 So that's where I'm directing

8 my answer from.

9 MR. BROOKMAN: Okay? We should probably

10 note for the Record that both of the gentlemen

11 speaking about clippers have beards.

12 MR. ERDHEIM: And it took me a lot of

13 preparation to get this beard for this Hearing.

14 MR. BROOKMAN: And you're looking good,

15 too.

16 MR. ERDHEIM: Looking good. Wasn't my

17 beard put into the Record earlier?

18 MR. BROOKMAN: We need a video here.

19 MR. ALBERT: Larry Albert. What drove

20 my question with respect to utility and price was

21 a little different than what Mike mentioned before.

22 That is specifically one of the things we're

23 looking at, is that the changes that have occurred
147

1 over the long period of time that we've been

2 discussing energy efficiency, battery chargers, and

3 so on, is a shift from our market, -- Right? --

4 from almost completely nickel-based chemistries, to

5 a combination now of nickel-based and

6 lithium-ion-based chemistries.

7 Lithium-ion-based represent

8 efficiencies with respect to the gravimetric

9 efficiency, and also with respect to

10 self-discharge, which are desirable features in the

11 end product. They also offer a benefit with

12 respect to energy consumption.

13 So, one of the concerns here is that as

14 you look at the data, -- And we recognize that

15 there may be distinctions between some products

16 that have one chemistry, or another chemistry that

17 might offer a benefit with respect to energy

18 efficiency. -- can it automatically be presumed

19 that better, if you were to treat that as better

20 utility, that improvements in utility would

21 automatically be considered a desirable trait, and

22 therefore not a restriction with respect to

23 investigating energy efficiency?
148

1 So, it was really directed in that ilk,

2 right? And since that, frequently that the utility

3 advantage associated with lithium-ion comes at a

4 premium, -- Right? -- there's a price associated

5 with the utility as you might often expect to

6 be the case.

7 Right? But, the perceived utility there

8 is that the consumer's buying that 

9 because it's lighter and because it sits on the

10 shelf longer, not because of the energy efficiency.

11 So that's the reason why I

12 was going down the avenue that's generated a bunch

13 of other discussion that wasn't necessarily

14 associated with my intent at that point, but it was

15 good.

16 MR. BROOKMAN: Okay, let's return to 

17 the slides.

18 Michael.

19 MR. VLADIMER: Excellent. Thanks for

20 that discussion of these different, the product class

21 characteristics.

22 Now I'd like to examine them in a little

23 bit more detail, first for external power supplies.
149

1 So, after reviewing the table I just presented, DOE

2 settled on four characteristics that it used to

3 characterize EPS product classes: Class A versus

4 non-Class A; output power, output voltage; type of

5 power conversion.

6 Output power. I'll discuss all four of

7 these in detail in a moment, but what matters is

8 down here.

9 You can see the Class A EPS product

10 classes. Essentially they're divided between basic

11 voltage and low-voltage output, as well as AC/DC

12 and AC/AC conversion.

13 You'll note that I mentioned output

14 power, but you don't see it because it's included in the Standard.

15 Let's take a look at these four criteria.

16 So, first EISA called out Class A EPSs as

17 a specific type, so that's why we

18 have Class A on its own. Second output power, high

19 output tends to be more efficient than low output power.

20 So, DOE's going to have to account for

21 that in the Standard. High output voltage also

22 tends to be more efficient.
150

1 And DOE is intending to use ENERGY STAR

2 as a criteria to define what "low voltage" means.

3 DC-output EPSs tend to be able to reduce their

4 no-load power consumption more so than the AC output

5 EPSs, and that's why they’re broken out.

6 Any questions? Thoughts?

7 (Whereupon, at 11:49 a.m. ET, no

8 response was had.)

9 MR. VLADIMER: Excellent. So, moving on

10 to the non-Class A product classes, so, essentially

11 for medical and MADBs, the same criteria apply as

12 for Class A.

13 So, it has the same product class

14 structure. For the other two non-Class A EPSs,

15 multiple voltage and high power, DOE is adopting

16 the structure that comes primarily from the determination

17 analysis where it had two different product classes for

18 multiple voltage EPSs. And one

19 product class for high power because that only has

20 one major application.

21 Going on to battery chargers, again,

22 after reviewing all the different criteria, DOE

23 settled on these five, and I'll examine them in
151

1 detail in a moment. But, we were looking at

2 battery energy, battery voltage, inductive chargeability,

3 input voltage, and output voltage of the battery

4 charger or product.

5 So, here you can see there's ten

6 different battery charger product classes. One is

7 for products that are low-energy with inductive coupling.

8 Product classes 2 through 7 are

9 different combinations of battery energy and

10 battery voltage. And then finally, 8 and 9 are for

11 battery chargers that have DC input power.

12 And then the last product class, 10, is

13 for 

14 uninterruptible power supplies that provide AC

15 output power. So, let’s look at the basis for

16 these different divisions.

17 So, first and foremost, battery energy

18 has the largest impact on utility.

19 Battery voltage affects battery chargers'

20 efficiency and utility.

21 Inductive battery chargers, as we've

22 been mentioning, have a unique utility, and so

23 that's why they're called out separately. And for
152

1 battery chargers with DC input power, they don't

2 that have an AC/DC conversion stage, so they should be

3 more efficient than AC –input BCs.

4 And then finally, these uninterruptible

5 power supplies may have a DC/AC converter

6 which has its own overhead.

7 MR. BROOKMAN: Wayne Morris.

8 MR. MORRIS: Wayne Morris, with AHAM.

9 Michael, if you could, go back one

10 slide. Appreciate it.

11 The example applications inside are

12 illustrative. I assume they're not meant to be in

13 any way comprehensive of the types of products

14 that are shown in those categories.

15 MR. VLADIMER: That is correct.

16 The idea is just so people have something to refer

17 to with the number.

18 MR. MORRIS: Exactly. And

19 appreciate that.

20 I would mention that there are some

21 categories where, even within a category, it may

22 lop over between more than one of these

23 horizontal type categories. There are some
153

1 floor-care appliances, for instance that

2 are in either the low-energy/medium-voltage,

3 or low-energy/low-voltage, depending upon the

4 number of battery cells, essentially, --

5 MR. VLADIMER: Yes.

6 MR. MORRIS: -- Is what they are

7 very dependent upon.

8 And so your battery voltage,

9 and especially in the nickel-based 1.2 volts per

10 cell, I mean, you have three cells, you have 3.6;

11 you have four, you have 4.8, et cetera. You spill

12 over into some of these other categories.

13 And there are some of them that are

14 certainly upwards of 12 volts, in that range.

15 So, even within a particular product line, you may

16 have products that, that differentiate.

17 You may have a category like a

18 hand-held vacuum cleaner that may range all the way

19 in these. So, it makes it more difficult than when

20 you try to show that spread as you get

21 into the actual life-cycle analysis of

22 to drive that down to an individual product

23 category.
154

1 So, I just wanted to make sure we

2 understood that. Thank you.

3 MR. BROOKMAN: Thank you.

4 MR. VLADIMER: I'll continue.

5 Excellent.

6 So, DOE seeks

7 comment on the product classes for battery chargers,

8 comment on these product classes; of course, for

9 the EPS product classes that I've presented, as

10 well. In particular, some of the product classes

11 , as we've mentioned, combine different

12 types of products.

13 And, DOE would welcome opinions and

14 comments on that.

15 MR. BROOKMAN: Additional comments on

16 this?

17 MR. MORRIS: Just one.

18 MR. BROOKMAN: Yes. Wayne Morris.

19 MR. MORRIS: We

20 would agree with the comments that Ric Erdheim made

21 that we would like to ask that the infrequently

22 charged be considered in here. Inductive has

23 certainly been considered as a separate product class
155

1 because of essentially its utility function.

2 MR. PETROLATI: Right.

3 MR. MORRIS: I'd also note that, that in

4 Regulations for things like standby power, that

5 infrequently charged or infrequently plugged in 

6 is a common type of situation. For instance,

7 vacuum cleaners, standard, ordinary, upright AC

8 vacuum cleaner wouldn't really be much use in terms

9 of a standby power Regulation, since I would assume

10 that 99.9 percent of people don't leave them plugged

11 in every day.

12 And so when you have a situation, as we

13 have with many of these personal-care products that

14 are not left plugged in and may only be plugged in,

15 you know, once a week or once every two weeks or

16 three weeks or four weeks, the energy

17 savings is going to be significantly reduced on

18 those candidate standards levels from where we are.

19 Now, I know that the

20 Department had to sort of use integers in terms of

21 its measurement.

22 It's pretty hard to get down to showing

23 a usage pattern of 0.0001, something like that.
156

1 But even estimating the one hour a day is a

2 gross over-exaggeration of most of these situations.

3 So, I think that that might fix that

4 situation and help us through the issue if

5 the life-cycle analysis could have

6 a consideration on that type of class. Thanks.

7 MR. BROOKMAN: Okay. Thank you.

8 Yes, Larry.

9 MR. ALBERT: Larry Albert.

10 So, Mike, your question up there

11 specifically points to PC4, -- Right? -- which has

12 come up several times where we have the same product

13 class for both power tools and notebook computers.

14 And I understand the dilemma here where,

15 you know, you can't have a hundred product classes,

16 right? So, necessarily you're going to have some

17 product classes that are going to contain in them

18 some divergent categories of products 

19 that have some differences in how they're used,

20 both technologically and how they're used, and so

21 on.

22 And so fundamentally I don't know if the

23 issue here for us is that one
157

1 product class contains both categories, but then

2 some of the derivative analysis that was done on

3 that basis, for example, tracking averages of

4 characteristics between the two, because laptops

5 have, you know, a much larger quantity.

6 When you do a weighted average 

7 of some of those characteristics you get results

8 that are highly skewed towards the laptops, and not

9 necessarily representative of both

10 categories. And that's where the problem

11 is.

12 You know, surprisingly I have less of an issue

13 with the usage pattern and probably more of an issue with

14 some of those weighted averages that were used for

15 the basis of the CSLs and other things. Seems more

16 of an issue of how you're handling the data once

17 it's in the product classes, and less of how you establish

18 product classes that have to contain sometimes

19 divergent products.

20 MR. BROOKMAN: All right. Thank you,

21 Rick.

22 Please.

23 MR. HABBEN: I have an issue regarding the less-than-four-volt

24 product class, Product Class 2. You state in there
158

1 that you know battery voltage affects the battery

2 charger efficiency and utility, and I guess I

3 would bring up the point that currently we have

4 several products that are single-cell application

5 in a nickel-based chemistry.

6 So, they're at 1.2 volts. With this, it

7 brings some challenges when you start to bring in

8 charge control.

9 you're going to deal with a microprocessor or

10 whatever, because at this current time the

11 voltage coming into the product is much less than

12 what it takes to maybe run an IC chip to cut it

13 off.

14 So, I guess I would just urge maybe

15 consideration for a product class with a

16 single-cell application. And the single-cell

17 applications are important to -- Again,

18 I don't want to belabor the thing on price, but

19 you, to keep the costs down not buying

20 multiple cells for your product when the utility of

21 the product doesn't require it.

22 So, you can be able to keep the price

23 down and still give the consumer the product that

24 functions properly, and
159

1 does the job for when it's needed. So

2 that's all.

3 MR. BROOKMAN: Thank you.

4 Okay. Additional comments on these

5 matters?

6 (Whereupon, at 11:59 a.m. ET, no

7 response was had.)

8 MR. BROOKMAN: Okay.

9 MR. VLADIMER: Okay, I'll continue on to

10 Efficiency metrics, and then technology options. So, it's external,

11 it's operation and power supplies. They operate 

12 consumer loads. For external power supplies

13 there's essentially two modes, no-load mode and

14 active mode.

15 No-load mode is when an EPS is not

16 plugged into its application, and active mode is

17 when it's plugged in. So, in no-load mode, all of

18 the power that goes into the EPS is just consumed

19 by the EPSs.
160

1 For no-load mode

2 power is being provided to the application.

3 So, we look at the average efficiency.

4 For battery chargers we have active or charge mode,

5 maintenance modes, standby mode, and off mode.

6 So, "Active Mode," when you're actually

7 charging up the battery. "Maintenance Mode,"

8 when the battery's topped up, just making sure that

9 it stays there.

10 "Standby Mode," the battery is out of the

11 battery charger. And "Off Mode," the battery charger's

12 actually turned off.

13 So, for Active Mode we're looking at 24-hours energy

14 hours' consumption. Of course, many battery

15 chargers are going to charge well within that

16 24-hour energy consumption, but that's the metric.

17 I should note that this is not yet

18 codified in the battery charger test procedure.

19 I'm referring to what was proposed most recently in

20 the battery charger test procedure NOPR.

21 So, as Vic mentioned earlier, that will

22 be finalized towards the end of the year. So, this

23 is what DOE intends to do, based on that NOPR.
161

1 "Maintenance mode," just power into the

2 battery charger. Same with

3 "Standby" and "Off."

4 And the last point I want to make, and

5 everyone sees this, UEC: unit energy consumption

6 is the metric that DOE used to analyze battery

7 chargers. There's going to be a full discussion of

8 that in the "Energy Use Analysis," but for now I

9 just want to let everybody know that's what we're

10 going to talk about.

11 And in the engineering, we'll mention it. But,

12 please, when it comes to discussing how it was

13 derived, that's the discussion we're going to have

14 during "Energy Use Analysis."

15 Excellent. Then on to technology options.

16 So, battery

17 chargers and power supplies, so there's a lot of

18 the technologies that are applicable to both. To

19 name a few, you can improve the transformer, you

20 can use better diodes and synchronous

21 rectification. And then there's a couple unique battery

22 charger technologies, such as eliminating the

23 maintenance current and the no-battery current.
162

1 And now I'll just request some

2 comments.

3 So, if anyone has comment on the

4 technology options I just mentioned, there's a full

5 discussion in the TSD. But, anything you want to

6 add?

7 MR. BROOKMAN: Wayne Morris.

8 MR. MORRIS: Wayne Morris, with AHAM.

9 Michael, you all did an excellent job

10 of both surveying the industry and

11 manufacturers and technical experts and I

12 commend you and your staff for all the work

13 you did looking at all of the technology options

14 that exist. And it's excellent and very, very

15 timely to be considered in your report.

16 The one thing that I guess we were a

17 little bit concerned about was: Were intellectual

18 property issues considered in some of these

19 technology options?-- Is there a particular

20 application possibly within the inductive

21 coupling that will, in order to hit certain levels

22 in the candidate standard levels, this may encroach

23 upon intellectual property Patents that are out
163

1 there?

2 And I have not run across this

3 before, so maybe this is a question for Mr. Kido,

4 is that my understanding is that the Department

5 doesn't necessarily choose candidate

6 standards levels if it requires encroachment upon

7 intellectual property that would be the only

8 way to achieve that particular CSL. Is that

9 correct?

10 MR. KIDO: That's generally

11 correct. And, like I said earlier, as part of the

12 analysis that's done during the NOPR phase, it's

13 exactly those types of issues, I believe, that are

14 typically considered --

15 MR. MORRIS: Exactly.

16 MR. KIDO: -- at that point.

17 MR. BROOKMAN: Thank you, Michael.

18 MR. KIDO: If you're aware of

19 particular issues that we should be aware of and

20 that you want us to consider, I'd suggest that

21 you identify those in written comments.

22 MR. MORRIS: Wayne Morris again.

23 I'd say we won't deal with that
164

1 in our comments. However, it may be something that

2 individual companies are going to have to divulge

3 to you because in order to tell you where the

4 encroachment is, they're going to have to tell you

5 where their current technology is.

6 And that's a very proprietary piece of

7 information. So, they may need to work with you on

8 divulging proprietary information to you or to your

9 consultants through NDAs or whatever in order to

10 tell you where the rub is.

11 You see my point with all this. So,

12 it's not something that the Association can deal

13 with, but individual companies may

14 have need to deal with that.

15 MR. PETROLATI: Okay.

16 MR. BROOKMAN: Wayne, will the

17 Association send out a message --

18 MR. MORRIS: Yes.

19 MR. BROOKMAN: -- laying those out for

20 your consideration?

21 MR. MORRIS: Yes.

22 MR. BROOKMAN: Yeah, Mike.

23 MR. PETROLATI: Yeah, Michael. We've
165

1 not run into this issue, have we, on any of our

2 manufacturers on EPSs?

3 MR. VLADIMER: As far as I know, no,

4 we've not run into that.

5 The other thing, Wayne, specifically in

6 Chapter 2 of the TSD there was a comment from the

7 framework document addressing this exact question.

8 And the answer is consistent with what Michael Kido

9 just said in addressing that comment.

10 MR. BROOKMAN: Yes.

11 Larry.

12 Then, Ric.

13 Larry.

14 MR. ALBERT: Mike, I think I have a

15 couple of questions regarding the technology

16 options that you looked at. In looking at the

17 technologies there, a lot of those are related to

18 power conversion efficiency -- Right? -- in terms

19 of control options.

20 Were those also considered? And also, I

21 guess, did you consider, for example, moving your

22 charge time from a slower charger to a faster

23 charger as a way of achieving a better CSL, or one
166

1 cell chemistry to another cell chemistry to achieve

2 a better CSL?

3 Was that discussed in there?

4 MR. VLADIMER: Excellent question. And

5 the slide I'm showing is abbreviated, but, yes,

6 pretty much everything you've said is in the TSD.

7 So, here we mentioned low-voltage, they're

8 the main circuits in these. And in the TSD we talk

9 about having better algorithms that can charge more

10 efficiently.

11 You know, we’ve seen some resonant switching,

12 for instance. And as far as the other thing

13 you mentioned, --

14 MR. ALBERT: One of the points was

15 control termination versus non-terminating.

16 Termination under differential requirements, and so

17 on.

18 And charge time, which is related.

19 MR. VLADIMER: Exactly. That, that I

20 was going to mention as well.

21 So, charge time. Similarly, you can go

22 from a slow charger to a fast charger because there's

23 no, not only would you be more efficient, but you
167

1 don't negatively affect the utility.

2 So, people aren't going to wait eight

3 hours for their battery to be charged. It gets

4 charged in one.

5 MR. ALBERT: Right. But, higher utility

6 gets a higher price, and so that was baked into your

7 cost analysis.

8 MR. VLADIMER: Exactly.

9 MR. ALBERT: And then saying from

10 nickel, you consider chemistry as well, didn't you,

11 as an option?

12 MR. VLADIMER: Yes.

13 MR. ALBERT: So, from a nickel-based chemistry,

14 or, rather, chemistries that permit overcharging

15 versus one such as lithium-ion that do not, --

16 and requires special protection circuitry,

17 the cost of cells as well as the cost of the

18 technology to manage those cells.

19 MR. VLADIMER: Exactly.

20 MR. ALBERT: Okay.

21 MR. VLADIMER: And it's all, all

22 detailed in Chapter 5, which it --

23 MR. ALBERT: And, again, the argument
168

1 would be the higher utility is, it is in

2 lithium-ion and is similar, you didn't violate one

3 of those rules.

4 MR. VLADIMER: Yeah. There's no

5 trade-off between efficiency and utility.

6 You increase efficiency and you increase

7 utility. Thank you.

8 MR. ERDHEIM: I just want to clarify a

9 point, Vic, in response to what you said about the

10 meetings that you've had with industry. And we've

11 had an NDA with you, and we've had at least two,

12 two people from Philips, and maybe, maybe even more

13 who have talked to your staff.

14 So, there's no problem in giving you

15 the information. The concern that's been expressed

16 to me is:

17 Gee. If they come up with a CSL that

18 requires use of a patented technology, we may not

19 be able to get the technology award. That may

20 significantly increase the cost.

21 Or, if the technology is from one of our

22 competitors. So, that's what the concern is.

23 It's not providing you information. And
169

1 we don't want to -- We're not interested in saying,

2 "Take our technology and run with it."

3 What the concern is, is that from the CSL

4 -- And, again, people are -- There's so much

5 information, people are poring over this.

6 MR. PETROLATI: Right.

7 MR. ERDHEIM: But, we want to make sure

8 that there isn't something that is underlying the

9 assumptions of one or more of the higher-level CSLs

10 that was a patented technology.

11 MR. PETROLATI: Yeah, Ric. And we're

12 certainly concerned that there is something out

13 there, but nobody has mentioned this to us, to the

14 best of my knowledge.

15 And in our manufacturer interviews we

16 asked them, "What will it take in terms of

17 technology improvements and cost to reach these

18 various CSLs?"

19 So, the question has been framed in a

20 manner where, if there was a proprietary

21 technology, then that should have probably been

22 mentioned by a, certain manufacturers because he's

23 given us his best estimates, whatever it consists
170

1 of, and what technology would have been used to

2 reach those various CSLs.

3 MR. VLADIMER: I'll just add one more

4 thing to what Vic is saying. And this is

5 all in Chapter 15.

6 We're jumping the gun into

7 the engineering analysis, but one of things it says is

8 during manufacture interviews a common theme is

9 manufacturers would specify different efficiency

10 points and consequent costs.

11 And when they detailed the technologies

12 used to get there, they were often different. One

13 way had one way of designing a circuit because that

14 was their experience, and another manufacturer had

15 a different way.

16 So, at the end of the day the numbers

17 came out similar, but they had different paths.

18 So, I definitely agree with what you're saying

19 with these proprietary technologies, but no one has

20 said -- When we said, you know, "We found this

21 efficiency in the market. How would you get this

22 and what would the cost be?" nobody said, "I

23 couldn't do that."
171

1 They all had their own way of

2 getting there, and the costs were not wildly

3 different.

4 MR. BROOKMAN: Let's move to the comment

5 box.

6 Comments? The comment box you see

7 there.

8 DOE requests comment and data regarding

9 the designs that can increase the range of

10 considered efficiency improvements for either BCs

11 or EPSs, including design options that may not yet

12 be found in the market.

13 So, comment on that? Because we're

14 going to keep moving on here rapidly.

15 (Whereupon, at 12:11 p.m. ET, no

16 response was had.)

17 MR. BROOKMAN: Okay, so screening.

18 MR. VLADIMER: On to the screening

19 analysis. So, as I mentioned, we just finished the

20 technology assessment.

21 We reviewed all those different technologies

22 options, and before DOE wants to try to associate

23 costs with them, it does a screening
172

1 analysis.

2 So, the role of the screening analysis

3 is to take a look at the technology options, and

4 there's four statutory criteria that DOE

5 applies to see whether it can examine the four for

6 engineering. These are technological feasibility,

7 practicability to manufacturer, install, and

8 service, impacts on product utility or availability

9 to consumers, and impact on health or safety.

10 So, after looking at those four criteria

11 and the different technology options I just

12 mentioned, there were no screened-out technologies

13 for EPSs, but there were three for battery

14 chargers. And those three were lowering

15 the charging current or

16 increasing the voltage, because that can have

17 adverse impact on utility; and capacity, use, a

18 capacity reactance and use of non-inductive chargers for a wet

19 application. Either of those might have

20 adverse impact on safety. So, those are the

21 only three that didn't make it forward into the

22 engineering.
173

1 And this is pretty much the last slide

2 for the screening. So, if there's any questions,

3 we can take them now. --

4 MR. BROOKMAN: Yes, Larry.

5 MR. ALBERT: Sorry to delay lunch.

6 Again to get back to the lithium-ion

7 question here, at least in the appliance area there

8 have been no, there's been no safety standards

9 established for a battery-charging system for

10 lithium-ion-based appliances.

11 The standard UL 2575 is due to be

12 released probably within four weeks --

13 which details very specific and stringent

14 requirements for lithium-ion-based battery systems

15 because of additional concerns about safety of

16 these systems, right?

17 Many of the products, and also at

18 the same time in the marketplace -- and maybe

19 your analysis has shown this. -- is that it

20 doesn't seem to be any uniform means of managing

21 from manufacturer to manufacturer, you know, the

22 safety of these systems.

23 There's a lot of different approaches
174

1 that take place. The concern here is

2 you know, once we have what we believe to be a

3 good safety standard in place, -- Right? -- there

4 may be, obviously, additional, you know, overhead

5 with respect to energy associated with these

6 systems; additional costs as well.

7 Right? Which, you know, may affect

8 these products in the marketplace -- It's --

9 since that will change the, may change the analysis

10 at that point.

11 And so while the technology option

12 moving to lithium does not directly affect safety

13 if there is the proper controls put in place, --

14 Right? -- the fact that some of the analysis

15 may have been done on systems that were not

16 adequately protected, you know, might

17 have influenced some of the results that you may

18 have.

19 Right?

20 MR. BROOKMAN: Wayne Morris.

21 MR. MORRIS: Just to follow on that

22 comment, the comment period for 2575 has just recently

23 opened, and so some of the interviews that
175

1 you all may have had would come with companies

2 that, in many cases, may not have been aware of

3 changes that are necessary within that Standard.

4 So, now that it's out, companies -- And

5 we just recently had a meeting with our

6 manufacturers to bring them all up to speed and to

7 help them be aware of what these new changes to the

8 Standard are going to be. -- this could affect,

9 the initial types of meetings that they've

10 had, now that they've had an opportunity to see the

11 CSL situation, what's been forecast outward, and as

12 well as to now understand the safety standards

13 associated with it.

14 That doesn't mean it -- I don't know. I

15 don't want to make it seem as if the products that

16 are out in the marketplace today are unsafe.

17 That's not what it means. It means that

18 we're trying to design for wide range of tolerances

19 in manufacturing, different companies now entering

20 the manufacture of both the power supply

21 situation as well as the battery itself.

22 It's necessary for the safety Standards

23 to tighten a bit to make sure that that we
176

1 capture all of this. We continue to maybe

2 pertain and have the best safety record on

3 these that is possible, and this endeavor to

4 change the safety Standards was not done by some

5 outside force.

6 It was done by Industry asking for more

7 tests and more evaluation. But, until you finally

8 see the final document, you don't know what you've

9 got to design to.

10 And now that the manufacturers have that

11 document, with all the tests put in by everybody

12 and his brother too, as suggestions now it

13 becomes a baked cake. And you can actually go

14 to the design phase and design around it with

15 the circuitry necessary.

16 So, that's why, unfortunately, it wasn't

17 available for the earlier designation, and why it

18 may be necessary now to go back and revisit some of

19 that where lithium

20 chemistries are the required solution to

21 the problem.

22 MR. BROOKMAN: I see. Thank you.

23 MR. KIDO: Just quickly, is there anyone
177

1 from UL in the room by any chance?

2 (Whereupon, at 12:16 p.m. ET, no

3 response was had.)

4 MR. BROOKMAN: Thank you.

5 Additional comments?

6 MR. VLADIMER: I just want to clarify what this

7 fellow here was saying. So, Larry, I very much

8 appreciate what you're saying.

9 I just want to make sure that it's clear

10 that the analysis did account for all the overhead

11 circuitry. I think you raise an interesting point

12 that it, not all the safety systems were designed at the

13 same stringency, and it's great that UL is

14 now going to have a standard to do that.

15 But, to make sure it's

16 hundred-percent clear, the increase in cells

17 and increase the circuitry and the increase in the

18 energy savings, this, that was all part of it.

19 MR. ALBERT: Thank you.

20 MR. BROOKMAN: Final comments on this? Because I think we're 

21 about ready to go to

22 lunch.

23 Yes, lunch. So, we made really good
178

1 progress; covered a lot of ground.

2 And I appreciate the back-and-forth.

3 It's now 12:15, 12:16.

4 Let's take an hour for lunch, which

5 means we'll be back here at 1:15.

6 (Whereupon, at 12:17 p.m. ET, those

7 present took a brief recess and returned at 1:22

8 p.m. ET, after which the following occurred:)

9 MR. BROOKMAN: Please take your seats.

10 We're going to begin, or I should say resume.

11 So, then we are going pick up where

12 we left off. Thanks for making it back here on

13 time.

14 We're going to continue with Michael

15 Vladimer.

16 ENGINEERING ANALYSIS

17 MR. VLADIMER: Excellent. Hello, once

18 again.

19 Michael Vladimer, with Navigant

20 Consulting, once again. Thank you.

21 

22 So, let's just use this figure to recap.

23 Now we're getting in the mid-stage analysis, so we
179

1 already talked about the market and the technology.

2 We know that the products that are out

3 there and what the major applications are. The

4 tech told us what are the technology options; how

5 DOE will divide these products into product

6 classes.

7 We screened out a couple of the

8 technology options because they didn't meet

9 statutory criteria, and now we're going to

10 talk about the engineering analysis.

11 And the engineering analysis is really

12 the workhorse of the analysis. It's where we define the relationship 

13 between cost

14 and efficiency.

15 And so these two graphs try to tell that

16 story very succinctly. So, on the left we have

17 just a generic cost efficiency curve.

18 This is what we're trying to create as

19 an output from the engineering output. So, on the X

20 axis we have efficiency; on the Y axis we have cost.

21 What that graph shows, when you're

22 inefficient, you tend to be cheap for the first

23 price, and when you get more efficient it's going
180

1 to cost a bit more money. So, what that translates

2 to, there's a number of downstream increases that

3 use that, but just to give people a sense, I have a

4 graph here that shows when the -- And in the case

5 -- Can you can see that, the low efficiencies?

6 And even though the product was actually

7 cheap, it's going to cost a bunch of money because

8 the operating costs are high. And when you go to

9 a very high efficiency, your operating costs wasn't

10 so high, but the purchase price was originally

11 quite high.

12 And so you're paying for that. So,

13 somewhere along in that curve there is an

14 optimum.

15 And DOE will probably set the Standards

16 based on that curve, or these types of curves.

17 But, this is really the overview of what the

18 engineering analysis is about and why we're doing

19 it.

20 Any questions?

21 (Whereupon, at 1:24 p.m. ET, no response

22 was had.)

23 MR. VLADIMER: Excellent. So, how do we
181

1 get here?

2 Well, actually, before we jump into the

3 exact structure, I just want to point out that

4 there's, you're going to see two types of curves

5 coming up. So, one, the hockey-stick-shaped curve

6 that I showed the first time, and that relates to

7 EPS efficiency.

8 We're increasing efficiency by

9 increasing cost. But, this might be 

10 counterintuitive,

11 so I wanted to call it out for EPS no-load

12 power consumption and battery charger unit

13 energy consumption.

14 In both of those cases, "lower" means

15 more efficient. So, that's why it's, the shape is

16 flipped.

17 Okay. So, I think it's really important

18 to establish that it's a

19 preliminary analysis meeting.

20 We really want to focus on inputs and

21 methodology into the engineering analysis. The

22 inputs to this are public comments, the-- There's

23 another public comments DOE received for the
182

1 framework document. -- manufacturer interviews, and

2 test and teardown data.

3 So, interviews, methodology section --

4 I'll go to each of these different in detail. --

5 representative product classes, representative

6 units, candidates standard levels of efficiency, or

7 CSLs, data scaling, price analysis, and CSL

8 scaling.

9 The outputs of all this are cost

10 efficiency curves, but at this point we're not

11 going to focus on that. We don't want to get too

12 detailed on what the results are, because, based on

13 what everyone's comments are today and in

14 writing, DOE will adjust.

15 So, once that changes these outputs

16 change. So, it's not that important at this phase.

17 So, let's really focus on inputs and

18 methodology. So, we're going to look at the three

19 different types of products separately.

20 So, I'm first going to look at a section

21 entitled "Class A External Power Supplies." And then we'll talk about the

22 non-Class A external power supplies, and then I'll 

23 hand off to Matthew Nardotti to take us through
183

1 the battery charger engineering analysis.

2 So, originally the tech assessment, I

3 mentioned that there are four product classes. Of

4 these four product classes, DOE chose to focus

5 specifically on Product Class A1.

6 DOE believes that by focusing the

7 analysis on this product class it's able to then extrapolate,

8 because the other product classes are related, and

9 I'll explain how it could extend the analysis

10 to all the different EPS product classes.

11 So, within product Class A1 DOE focused

12 on four representative units. Those units are 2.5

13 watt output power, 18 watt, 60 watts, and 120 watts.

14 And I should really stress, a

15 representative unit is a theoretical tool. There's

16 no physical thing as a representative unit.

17 It doesn't exist. You can't hold it in

18 your hand.

19 But, it's a theoretical tool. That's

20 where you define the characteristics of the product

21 in every single way except cost and efficiency,

22 because that's what we're trying to analyze.

23 So, you define all those
184

1 characteristics, and then you pick certain

2 efficiencies to examine. And then you look at the

3 resultant costs.

4 We're a little tight on time so I'm not

5 going to go too much into the criteria, but if

6 anybody has any detailed questions, just stop me

7 and I'm happy to examine in more detail.

8 So, as I was mentioning, DOE looked at

9 specific points of efficiency. Essentially,

10 you know, efficiency is a continuum.

11 But, DOE can't analyze continuum at

12 specific levels, so what it does, it creates CSLs

13 candidate Standard levels. That is where we

14 consider setting a Standard.

15 All of these, these four levels have

16 come from having a basis, CSL0, is a baseline

17 that's the current EISA Standard.

18 The next one, CSL1, that comes

19 from is ENERGY STAR. And intermediate was based on

20 manufacturers' data points.

21 Best in market, that's the best units

22 that DOE found in the market. And then max tech,

23 that's again manufacturers’ data.
185

1 Max tech is another kind of conceptual

2 thing. You're not going to find -- Typically

3 you're not going to find a max tech type of market

4 out in the marketplace.

5 The idea is that the max tech is so

6 efficient it might not be cost effective. In some

7 cases it might be, but the idea of you've really

8 pushed the technology as far as it can go in every

9 single way.

10 So, these graphs just show you what, how

11 the CSLs work visually. So, the

12 main thing here for EPSs to call out is that EPSs

13 were regulated in what DOE terms "matched pairs."

14 And what that means is the EISA Standard

15 and the analysis following from it, it doesn't have

16 a single metric for efficiency. It has two

17 metrics, like I mentioned, average efficiency and

18 no-load power.

19 And efficiency has to meet both of those

20 Standards. So, to do the cost efficiency analysis,

21 DOE focused on matched pairs of efficiency and

22 no-load.

23 And what's really important about the
186

1 matched pairs is to note that the metric doesn’t decrease

2 in stringency. So, by always increasing

3 in strength, you can maintain the

4 cost efficiency of that relationship.

5 If you were to not have that, it makes

6 it much harder to analyze. That make sense?

7 Any questions?

8 MR. BROOKMAN: Ric, go ahead.

9 MR. ERDHEIM: I'm sorry. I feel a

10 little bit ignorant here.

11 But, could you kind of go through that

12 maybe a bit slower? I'm not understanding the

13 matched-paired concept yet.

14 MR. VLADIMER: Sure. Sure.

15 So, again, you know, the -- Coming back

16 to that original graph I showed where we had this

17 cost efficiency relationship, the idea is

18 typically, you know, as you increase efficiency, the

19 results are an increase in cost. And here we have two

20 different metrics.

21 So, if you were

22 to trade off one metric against another, then you

23 lose the relationship between efficiency and cost

24 if you do that.
187

1 I'm trying to, trying to think of how I

2 can answer that best.

3 MR. BROOKMAN: Larry, do you want to say

4 something?

5 MR. ALBERT: But, you could -- Here, for

6 example, no-load consumption, -- Right? -- and vary

7 another one. You just don't want one going

8 negative while the other one goes positive, right?

9 MR. VLADIMER: Exactly. That's what we

10 mean by saying it never decreases in efficiency.

11 MR. ALBERT: Right. Right. Right.

12 MR. VLADIMER: For instance, you can see

13 that I'll just point --

14 MR. REEVES: Michael, could I make one

15 clarification? So, you say it never could have

16 decreased as you move from lower

17 to successively higher CSLs?

18 MR. VLADIMER: Yes. Yes.

19 MR. REEVES: If you want to point to

20 that, use this. I'm right with you.
188

1 MR. VLADIMER: Excellent. 

2 So, what you're seeing over here --

3 MR. ALBERT: Matched pairs.

4 MR. VLADIMER: Yeah. So, I'll just

5 point out exactly what I mean by "matched pairs."

6 MR. MORRIS: They've got it.

7 MR. VLADIMER: We have all these

8 different columns. The green lines refer to EISA.

9 So, EISA, right now it's 500 milliwatts

10 in no-load, no matter what. And, you know, there's

11 that curved green line that's flat above 50 watts.

12 And so if you look at how EISA -- So,

13 that's our baseline. So, now let's say we 

14 increase in efficiency.

15 So, CSL 1 for some of these EPSs,

16 it's still 500 milliwatts. So, we haven't

17 decreased in efficiency.

18 But, you can see over in the

19 efficiency ground that the bar's gone up a bit.

20 And so, you know, now let's put some numbers on

21 there just to make this a tangible stamp, which he

22 thinks will help answer your question.
189

1 So, let's say it costs a dollar to build

2 the product. Now we go to CSL1, which is the

3 ENERGY STAR level, -- And now it costs

4 $1.50.

5 So, we know that by increasing our

6 efficiency, even though the no-load power

7 stayed the same, you know that that 50-cent

8 increase came from increases in efficiency. But,

9 let's say, okay, let's say we didn't have this

10 matched-pairs result.

11 Then we might result in something

12 totally different. We might have, you know, a

13 dollar at the baseline, and then we save money by

14 making the no-load power worse.

15 Let's say it's just one watt, and now

16 it's still a dollar. So, it's, you lose the value

17 of the analysis because it's not

18 holding constant that floor efficiency.

19 MR. ALBERT: Right. Okay.

20 MR. RIVEST: I think I can --

21 MR. BROOKMAN: Michael Rivest.

22 MR. RIVEST: Michael Rivest. I think

23 the concept EISA has put in it a situation where
190

1 we're regulating two metrics. We

2 have some suggestions, but we don't know if, in

3 fact, they were independent variables.

4 So, if they were completely independent

5 variables we could see the cost of going from this

6 requirement on Metric A, to, to a more stringent

7 additive, to, you know, to increasing stringencies

8 on the others. But, you know, we suspect that

9 there are, in fact costs that are joint costs.

10 So, by creating these matched pairs and

11 then going, increasing the stringency on both

12 metrics simultaneously, we're creating a single

13 cost efficiency curve and we're capturing all of

14 the joint costs by doing that.

15 MR. ALBERT: So, you're not -- Larry

16 Albert again.

17 So, you don't feel the necessity to do

18 essentially a sensitivity analysis with respect 

19 to one metric or another with respect to cost? In

20 other words, if you were just vary no-load and you

21 left the efficiency alone, --

22 MR. RIVEST: Right.

23 MR. ALBERT: -- would that have more
191

1 impact than just holding the no-load constant

2 during the efficiency?

3 MR. RIVEST: That's 

4 analysis that could be done, but I don't know how

5 you'd ever hold something constant because as soon

6 as you modify the circuitry to improve one, you may

7 have to make the other worse to maintain its

8 efficiency. So, it just compounds the problem.

9 And I don't see the benefit, whereas

10 doing it this way, creating a matched-pair

11 requirement and just figuring the cost of going

12 from this matched-pair requirement to this match,

13 we can create the continuous function.

14 Also, the benefit of, and the reason why

15 we are moving both in tandem in stringency is that

16 assumption, but how the use of one mode versus the

17 other could potentially reverse the cost

18 relationship, the life-cycle cost. And what we

19 were looking for is a relationship which shows

20 constant energy savings regardless if it's

21 loaded 80/20 or 20/80.

22 And that's why we chose this

23 concept, essentially. Now, battery chargers, it's
192

1 a completely different situation, because our

2 metric is a joint metric.

3 So, we're immediately, you know,

4 creating that single metric.

5 MR. BROOKMAN: Wayne?

6 MR. MORRIS: And I'm glad you mentioned

7 that, Michael, -- Wayne Morris. -- because you

8 know that is, in fact, very much the case that

9 we've been stating, is that on a pure EPS

10 situation, many of the battery chargers spend

11 extremely very minimal amounts of time in a

12 no-battery mode.

13 I mean, you can think of a cordless

14 rechargeable vacuum cleaner. I mean, you spill a

15 couple of Cheerios.

16 You pull it out of the base. You suck

17 up the Cheerios.

18 How long was it in a no-battery mode? A

19 minute? Two minutes?

20 You know, versus 12,000 hours in a year.

21 When you extrapolate that out, you're talking about

22 extremely small amounts.

23 So, where's your gain to be made? The
193

1 gain primarily is in the active or maintenance

2 mode.

3 So, in relationship to the two, probably

4 the longer period of time in maintenance mode than

5 in active mode. So, you know, so while we

6 consistently agreed to have active mode included in

7 this, when you start into these matched pairs, if

8 you're treating a battery charger as an EPS, you're

9 really wrongfully tagging one particular

10 characteristic, in this case the no-battery mode,

11 and emphasizing it even though, in fact, you see

12 very little of it in gain because the product never

13 sees that time period in the usage factor.

14 And that's why the usage factor becomes

15 so important. And you get to the battery chargers

16 and you begin to approximate those usage patterns.

17 Now, you're, in fact, getting to the way

18 that the consumer actually sees the savings and

19 energy. So, it's -- I agree with you totally.

20 Thank you.

21 MR. BROOKMAN: Suzanne.

22 MS. PORTER: Suzanne Porter from ECOS.

23 I just wanted to say that PG&E generally
194

1 supports the approach of considering the standby

2 metric and the active-mode metric, and the matched

3 pairs is a good approach to dealing with the two

4 separate metrics. Specifically we support the idea

5 that regardless of how the power supply is used,

6 whether it's used primarily in active or

7 primarily in no-load, that you would get energy

8 savings in either case with the various CSL levels.

9 So, given the wide range of duty

10 cycles for these products, the matched pairs seems

11 like a, a reasonable solution.

12 MR. BROOKMAN: Thank you.

13 MR. PETROLATI: If I could also -- Vic

14 Petrolati, Department of Energy.

15 We are using the matched-pairs approach

16 because Congress, obviously, in the original

17 legislation, established Standards for both active

18 mode and no-load mode. And in consideration of

19 future standards, we would not be able to deviate,

20 I believe, from that approach and maintain that we

21 have not made the Standard less stringent in some

22 manner.

23 MR. BROOKMAN: Um-hum.
195

1 MR. PETROLATI: So, the way that

2 Congress established the original legislation

3 presents a constraint for us in moving forward in

4 any other manner. And it wasn't necessarily our

5 decision that this was the best approach, but it

6 was the manner that fit within the legislative

7 requirement.

8 MR. BROOKMAN: Okay. We're moving on,

9 okay?

10 MR. VLADIMER: Excellent. So, you can

11 see that there's equations and, that define those

12 curves.

13 So, let me present those equations.

14 Here we're looking at the average efficiency

15 requirements.

16 Essentially there's three divisions, 0

17 to 1 watts, 1 to 49 for most of these, and then 49

18 and greater. Similarly, on the no-load side

19 there's two divisions, 0 to 50, and then 50 and

20 greater.

21 Any questions or thoughts on the, the

22 numbers?

23 MR. BROOKMAN: You're asking for comment
196

1 on the way you divided this up, the way you split

2 it?

3 MR. VLADIMER: Sure.

4 MR. BROOKMAN: Larry.

5 MR. ALBERT: No, this is actually more

6 of a general point. In this particular area --

7 Sorry.

8 In this particular case, with the EPSs,

9 once you establish when you take a look at one of

10 these candidate Standards levels, you consider any

11 particular EPSs -- Right? -- that would fall under

12 that product class, right?

13 You can evaluate whether it complies or

14 doesn't comply, regardless of what its voltage is

15 or anything else, because you have a

16 curve to compare it to, right?

17 MR. VLADIMER: Exactly. So --

18 MR. MORRIS: Right.

19 MR. VLADIMER: Here you take your

20 20-watt EPSs. You can see that you'd fit between 1

21 to 49.

22 But, plug it, it in and find, you'll

23 figure out whether you're above or below the curve.
197

1 MR. ALBERT: And I know this is looking

2 forward, but when we get to the battery chargers,

3 it's different, right? Or is it not different?

4 MR. VLADIMER: We're not there yet.

5 MR. ALBERT: Okay. I just wanted --

6 MR. VLADIMER: It's complicated

7 MR. ALBERT: Depends.

8 MR. VLADIMER: Right. And, Larry, just

9 an overall point, because I see where you're going

10 there.

11 The first line, that's EISA. 

12 Battery chargers don't have those

13 Standards yet, so that's why it's a bit fuzzier.

14 And we'll see where we go with that.

15 MR. ALBERT: Right.

16 MR. VLADIMER: So, I wanted to move on

17 to show you exactly what this means for our units.

18 So, I originally started by saying DOE

19 examined four representative units, 2.5 to 120

20 watts, and by applying those output powers, the

21 output powers to these equations, you can get these efficiency 

22 requirements.
198

1 Now, we're really talking about matched

2 pairings between, of efficiency and no-load for any

3 of these units at any of the CSLs. And, as we were

4 mentioning, for instance, at the 120 watt, you go

5 from 500 milliwatts at CSL0 to 500 watts, 

6 at CSL 1.

7 And that maintains matched pairings

8 because you're increasing efficiency from 85 to 87

9 percent. 

10 So, request for comment. Any thoughts

11 on the representative units and the CSLs?

12 MR. BROOKMAN: Suzanne.

13 MS. PORTER: This is Suzanne Porter from

14 ECOS.

15 PG&E research suggests that a lot of the

16 variation, although there's a wide variation of the

17 duty stations, a lot of the variation, at least

18 with the initial Standards that were proposed in

19 California, were focused on the active-mode

20 efficiency. So, I don't have a specific comment.

21 We probably won't issue a specific

22 comment on levels in the CSLs, but I would just

23 encourage DOE to take a look at those very low
199

1 no-load values and ensure that we're not sort of

2 pricing out savings that would otherwise be had in

3 the active mode, as our numbers suggest.

4 Our initial research suggested that's

5 where the big savings were. So, I'm all for

6 more stringent Standards, but I want to make sure

7 that we're focusing on the right place.

8 And I don't have a, a turn-key solution,

9 but just maybe looking a little bit at your own

10 duty cycle assumptions and see how that plays out.

11 MR. BROOKMAN: Thank you.

12 You see the comment box there.

13 Additional comments or questions?

14 MR. VLADIMER: Excellent. So, we were

15 just looking at these representative units where

16 DOE focused in its analysis.

17 And so now I want to talk 2.5 watts, for

18 instance. Where do we go from here?

19 Well, the first slide said that DOE

20 looked for inputs in terms of manufacturing and

21 costing. So, this data is just illustrative.

22 So, under an NDA, manufacturers provided
200

1 cost -efficiency data. Again, we're dealing with

2 data like say sometimes, in three

3 dimensions, average efficiency, no-load power, and

4 costs.

5 So, we have two axes. Cost is

6 crossing both of them.

7 So, this pretty much tells the story of

8 what we're looking at. You know, it was

9 normalized.

10 Everyone gave data at the same baseline.

11 And often manufacturers rather than

12 giving data exactly to the CSLs, they said, "I

13 have a product in that range. Let me tell you

14 about that product."

15 And so this was an example

16 of what the data trend might look like. And so what DOE

17 did with the data was it took all that data and

18 aggregated it into an equation, and then for each

19 CSL you have an average efficiency and a

20 no-load.

21 When you apply to the equation,

22 you can derive the average cost, or the aggregate

23 costs, I should say. In the TSD there's a detailed
201

1 discussion of the three-dimensional equation, and

2 how that was developed.

3 I don't have time to get into that too

4 much right now, but definitely want to encourage

5 comment on it. Okay.

6 So, manufacturer interviews were one

7 point, and testing and teardowns were the other.

8 And so here what you're looking at is a plot of the

9 test results for the 18-watt units that were used

10 to try to characterize that 18-watt representative

11 unit.

12 Every single dot is an external 

13 power supply that DOE purchased and tested its

14 efficiency. And you can see that's graphed here in

15 terms of both the efficiency metrics.

16 The colored lines there indicate

17 the pairing of no-load power and efficiency. So,

18 every time you're following those arrows

19 toward more efficient, higher efficiency,

20 you're going to increase in your CSLs.

21 And one thing you might note is that the

22 max tech point, there is no unit there. Again,

23 that's because manufacturers described
202

1 that max tech point.

2 They say "If we were to beat

3 the best unit in the market, Number 941, this is

4 how we would do it," and so on.

5 So, that was the test

6 data. As far as the teardown goes, iSuppli is a

7 company that specializes in costing electronics,

8 and they did the teardown to evaluate, I think,

9 every single component.

10 And the costs, here we talk about the

11 bill of materials versus manufacturing costs.

12 I'll get into the differences on that in a couple

13 more slides.

14 But, what's important is that iSuppli

15 provided those costs. DOE thinks that they're

16 reasonable, and, of course, encourages comment on

17 the stakeholders' views of the 

18 manufacturer data.

19 MR. BROOKMAN: Wayne.

20 MR. MORRIS: Wayne Morris with AHAM.

21 A couple of questions for you, Michael.

22 When you say, you know, iSuppli did a sort of a

23 reverse engineering analysis of this and they
203

1 looked at the bond and labor costs, did they also

2 look at, at capital costs?

3 MR. VLADIMER: I'm, I'm pretty

4 sure that's not included.

5 MR. MORRIS: Did they look at

6 engineering time and engineering costs associated

7 --

8 MR. VLADIMER: I don't think so.

9 MR. RIVEST: I don't, either. So, let

10 me anticipate where we're going.

11 So, if the bill for materials, raw costs

12 were marked up, -- And a typical markup is a markup

13 that will cover SG&A and, and overhead. And within

14 overhead you'd have depreciation.

15 So, to the extent that depreciation

16 represents, on average, say, six percent of

17 material bond costs, it's incorporated in the

18 price. So, that is, in fact, taken into account.

19 What's -- The observation that, that,

20 that we made, and you'll see when we have the

21 results of the teardowns, is the results are

22 counterintuitive because more efficient products

23 cost less. And, you know, we can speculate about
204

1 why that is, and we would like to have you, we

2 would like to have you comment on why, why you

3 think that the results are the way they are.

4 We have our ideas. I don't know if you

5 want to share them, or that just --

6 MR. ALBERT: Larry Albert.

7 In the TSD there's a paragraph here

8 where it says DOE believes that the results from the

9 test and teardown method are inconclusive because

10 they do not show a clear relationship. And it goes

11 on to say, therefore, DOE chose to use only

12 manufacturer data in the LCC, in Class A EPSs.

13 Right? And that was based on that

14 result that you saw where you saw negative trends,

15 right?

16 MR. RIVEST: Right.

17 MR. ALBERT: So, are you still

18 considering the teardown analysis, or have you sort

19 of discounted that data? Because it seems to be

20 contradictory.

21 MR. RIVEST: I think we're open to

22 interpretations of, of what that data means. As I

23 said, we certainly have our opinions, personal
205

1 opinions.

2 The Department doesn't have an official

3 opinion at this time. Does anyone care, care to --

4 MR. PETROLATI: Well, I'd also like to

5 add that we haven't, at this time, decided that

6 we're not going to do any more teardowns for EPSs.

7 We are going to continue to do teardowns on, for

8 EPSs, and add it to the data we have to see if we

9 have any more conclusive cost-efficiency curves.

10 So, we haven't, by any means, determined

11 that it is unacceptable to do teardowns at this

12 point to evaluate a cost-efficiency curve.

13 MR. ALBERT: But, you had a problem with

14 the data, correct?

15 MR. RIVEST: Right. We had a problem

16 with the data. Right.

17 MR. BROOKMAN: That was Larry, and now

18 Rick.

19 MR. HABBEN: When iSuppli did the

20 teardowns and they did the costs of those

21 particular boards and stuff, and maybe it was in

22 the TSD, and if it wasn't, sorry, if it was

23 supplied in this TSD. But, what were the
206

1 quantities that were quoted, or the quantities that

2 the components were based on?

3 MR. VLADIMER: Excellent question. It

4 is in the TSD.

5 I don't remember

6 offhand. Is it about a million units per year,

7 depending on which -- I have here some were annual

8 production and lifetime production value.

9 And those values are detailed in the

10 TSD. So, you could specifically provide comment.

11 MR. HABBEN: So, I guess I'd encourage,

12 if it was based on a million, you know, there's

13 going to be a, a lot of different categories where

14 a million is much higher than what many, many of

15 the manufacturers would be making, especially when

16 you have multiple different product variations

17 within in a category.

18 So, you know, I think that if you're

19 going to use this data, then maybe some additional

20 cost analysis should be done where you're taking

21 volumes, you know, as low as probably, you know, in

22 the, -- I don't know --

23 20,000-piece range, where maybe it would have some
207

1 lower-volume-type units that you'd be supplying.

2 MR. BROOKMAN: Thank you.

3 Wayne.

4 MR. MORRIS: This is Wayne Morris.

5 Yes, I would concur with Rick, that based

6 on your experience, you're talking about external

7 power supplies. You're talking about not all

8 together, but largely a commodity item that a

9 manufacturer, one of, you know, a dozen or so large

10 manufacturers manufacture EPSs.

11 They make a particular series of

12 catalog numbers. Very often there's slight

13 differences between them in the catalogs that will

14 give them slightly different output.

15 So, you can, as you, design your

16 computer speakers or whatever, you go to the

17 catalog and look for the input wattage that is

18 necessary, and you pull that up. And so that

19 company that is making that particular external

20 power supply is making a very high volume of those,

21 and selling them in, in very high volumes to

22 multiple users of that.

23 The battery chargers, it's different.
208

1 And we've emphasized this in a number of occasions,

2 that a battery charger is uniquely designed

3 according to the output, the design, the chemistry,

4 the usage patterns, the charger, the time

5 periods, and lots of other factors that, that

6 dictate the type of charger that, that is

7 necessary, which all translates to mean when you

8 talk about Company X's shavers, that may represent

9 20 different models of shavers, having different

10 outputs in terms of their charge times and their

11 batteries and the run times and all those

12 configurations, which means a different charger for

13 every one of them.

14 Therefore, the quantities are going to

15 be much smaller, and the differences between those

16 are going to be significant. And so we do believe

17 that, that the analysis has got to be run at much

18 smaller quantities than a million units per year,

19 probably even less than 100,000 units per year, in

20 order to get a true picture of what the cost is.

21 Because a company is not going to buy

22 based on they're going to use that MOSFET

23 or that IC chip on multiple different models. They
209

1 may not.

2 They may have to use different IC chips,

3 in which case they're buying small quantities of IC

4 chips. You know, it's not that they're building a

5 battery charger for everybody in the world.

6 They're building it only for their

7 particular product. So, I think the scaling

8 presentation is quite different for each of these

9 products, which makes it, again, like I said, Mike,

10 this whole rulemaking becomes significantly more

11 complicated than other ones.

12 I think that we've got to look at the

13 effect, particularly on small and medium-sized

14 manufacturers. And, and even then, when you were

15 talking about a large company, cordless

16 rechargeable products may be a very small quantity

17 of their overall product line.

18 A company may have a vacuum cleaner

19 and that may be one of the biggest vacuum

20 cleaner companies in the United States, or the

21 world. But, cordless rechargeable products

22 actually make up a very small quantity of their volume--

23 So, they have to make it pay for itself on that
210

1 particular product or they might as well as not be

2 in that business, in which they may, in fact, find

3 themselves not being able to compete in that

4 business.

5 So, I think that's one of the reasons in

6 this situation. The other I would mention in terms

7 of doing future teardown analysis, you know, I

8 really believe that, that there's a number of

9 things that need to be considered that I'm not sure

10 were considered in the earlier stages.

11 Many of these teardown analyses, from

12 what I can tell, involve the use of fairly

13 significant amounts of, of electronic circuits,

14 and, and more complex, and, in fact, larger and

15 larger as you go up the CSL levels, more and more

16 complicated; printed wiring boards with more and

17 more circuitry involved, which means more and more

18 heat got to dissipate in some cases, which means

19 the size of these enclosures of these power

20 supplies have got to grow.

21 That means -- Translated into two

22 things. One, it means new production.

23 Excuse me. Plastic injection molds that
211

1 the companies have got to invest in, which is a

2 significant investment these days. Those things

3 don't come cheap.

4 And secondly, if you increase the size

5 of these power supplies, in some cases you've got

6 to increase the size of the carton that it comes in.

7 And now you can fit four cartons on the same skid

8 and fewer in the container when you're shipping it.

9 So, your transportation costs go up a

10 unit. And I know that that's not something you

11 traditionally look at in a lot of these initial

12 analyses, but I do think that at the very least the

13 engineering costs associated with redoing the

14 designs of every single one of the models has got

15 to be factored in.

16 It's not six percent raw costs 

17 in a depreciation overhead equation, because you're

18 going to take out every single model back through

19 and redesign the situation.

20 And for small and medium-sized

21 enterprises, that's an enormous amount of their

22 engineering assets, if they even have that many.

23 And the second thing is that the capital
212

1 costs involved as you begin to grow the enclosures

2 that are necessary I don't think are considered in

3 this, and I think they need to be in order to be

4 fair.

5 Thanks.

6 MR. BROOKMAN: Okay.

7 MR. RIVEST: Well, I'd like to draw your

8 attention to, --

9 MR. BROOKMAN: Mike Rivest.

10 MR. RIVEST: -- to the different

11 situation we're in here in EPSs and BCs. So, EPSs

12 have been regulated, all right, and battery

13 chargers have not.

14 And for those of you who have been

15 involved in these rulemakings for a long time, you

16 may remember where we did the first ballast

17 rulemaking where we took the technology from

18 magnetic to electronic. That there was 

19 significant, noticeable change in technology, and

20 you could quantify, you know, on one hand

21 pounds of magnetic steel, and on the other there

22 were electronic pumps.

23 Now we're regulating ballast again, and
213

1 we're going to, from one electronic ballast to

2 another electronic ballast. So, I would -- So, on

3 BCs we're going from, like, magnetic to electronic

4 ballast, and on EPSs we're going from one

5 electronic ballast to another.

6 Now, it's not as restricted as the

7 pharmaceutical industry, but the bond, I mean, the

8 raw material costs are practically nothing. It's

9 all AP.

10 And the cost, you can save costs through

11 better engineering. And also when

12 you find that some of these EPSs also may have been

13 designed three years ago, and others six weeks ago,

14 the more recently designed may have incorporated

15 technologies that weren't available before.

16 And in this world it's possible that

17 you're going to have better and cheaper. That

18 doesn't mean that the guy who's got a two-year-old

19 design who's still producing a million a year is,

20 you know, he can, can produce and sell the product

21 at that cost.

22 They have to amortize their investments.

23 MR. MORRIS: True, Mike. So, it, it's
214

1 important that they have sufficient lead time and

2 capital to make the, a transition to the new 

3 levels and the new designs, but it's not on its

4 face impossible to see that there would

5 be a slope if the one that is cheapest, has

6 actually got all new tooling, involved the greatest

7 IP.

8 So, that, that's what, you know, what

9 we've heard as one possible explanation of what's

10 going on. It doesn't mean that there's a free

11 lunch there; that there was no cost to get there.

12 It just means the costs have just been

13 made and show up.

14 MR. RIVEST: And so what to conclude

15 about that? On BCs, definitely the transition is

16 more noticeable.

17 You'll see that the grades of steel are

18 getting better. The steel is being completely

19 eliminated.

20 There's a wide variety of product out

21 there. So, it's an upward-sloping curve.

22 It makes sense. It's like refrigerators

23 and all our other products.
215

1 But, EPSs, I mean, -- And then think of

2 the gap efficiency we're looking at. It's thin.

3 It's tiny, right? BCs, it's, we're

4 really improving things, but we're not doing that

5 much on EPSs.

6 So, those are thoughts.

7 MR. BROOKMAN: Okay.

8 MS. PORTER: This is Suzanne Porter from

9 ECOS. I just want to make one comment, which is

10 based on the research we did on external power

11 supplies and batteries.

12 We tended to find that the most

13 efficient products were also the smallest. And

14 there's some reasons for that.

15 Part of it is what Mike Rivest just

16 mentioned, was the move from steel to electronics.

17 But, more importantly, as efficiency increases,

18 less heat is created.

19 So, you can go to a smaller case, not

20 larger. I can't speak to this analysis where

21 you're pushing beyond the EISA levels because we

22 have not done that.

23 And it could be the case where you
216

1 actually need more components. But, at least

2 historically, moving from where the market was in

3 2003, to where the market is today, you know,

4 external power supplies that are more efficient

5 were smaller.

6 Also, our observations today of the

7 battery charger market are that the more efficient

8 battery chargers tend to be small. And, in

9 fact, one of the reasons why we, you expect those

10 chargers are efficient is because of the drive for

11 portability in what they're associated with.

12 So, I have to respectfully disagree

13 with, with Wayne's comment about size, based on our

14 observations independently of the two markets.

15 MR. BROOKMAN: Okay, thank you.

16 MR. PETROLATI: I'd like to ask Mike --

17 MR. BROOKMAN: Vic Petrolati.

18 MR. PETROLATI: Yeah, Vic Petrolati.

19 DOE. On the manufacturer interviews, I seem

20 to remember a distinction between EPSs and BCs,

21 that the manufacturers for EPSs did not identify

22 any retooling costs as their cost for achieving the

23 various levels. Is that correct?
217

1 MR. VLADIMER: I think that we, we

2 touched on that lightly. I think it's more of a MIA

3 question, Manufacturers' Impact Analysis question.

4 MR. PETROLATI: Right.

5 MR. VLADIMER: But, up front I think

6 their main concerns were more about stock than

7 retooling. So, I think what you're saying

8 is correct, but I think that the best place to

9 answer that in detail would be in this round of

10 manufacturer's interviews that we're going to do as

11 part of it, the MIA, because that's when it's

12 really going to be a focal-point question.

13 And up until now it's been more of a

14 tangential question.

15 MR. BROOKMAN: Wayne Morris?

16 MR. MORRIS: Wayne Morris, with AHAM.

17 Probably true, but did you ask them and

18 tell them they were going to be expected as an

19 EPSs? That may be a different answer.

20 MR. PETROLATI: Actually, it should be

21 the same, based on our definition. But, I don't

22 think so.

23 MR. MORRIS: No, I don't think so.
218

1 MR. PETROLATI: Okay.

2 MR. VLADIMER: And also, I’d like to

3 echo what Suzanne said. The EPSs I've seen

4 torn down, we've seen that more efficient, means less

5 heat means smaller case sides. And again, that

6 means more utility.

7 So, it helps the consumer. We're not

8 going to look at it as a negative part of the

9 analysis.

10 MR. BROOKMAN: Final comments before we

11 move on?

12 MR. VLADIMER: Well, we've

13 kind of jumped the gun a bit, but I'll talk briefly

14 about how we did some scaling, and go to the

15 results. So, as far as the scaling goes, you'll

16 notice in the TSD that there's two discussions of

17 scaling.

18 As far as taking the data, DOE did some

19 really in-depth scaling of manufacturers’ data and test and

20 teardown data, and the issue is that, again, as I

21 said, the representative units are defined in terms

22 of their output cord lengths, their power, their

23 voltage. And we also wanted to have the output
219

1 from the engineering be the manufacturer selling

2 price.

3 And that's where we started, but we

4 weren't always -- That's where we wanted to end,

5 but we didn't always start there. So, DOE, you

6 know, if the cord length needed to be

7 lengthened, DOE would theoretically lengthen the

8 cord length and reduce the effective

9 efficiency of the EPS.

10 EPSs with higher output power, they

11 tend to be more efficient. So, DOE, in many cases,

12 slightly raised the EPS’s efficiency.

13 Higher output voltage, again, more

14 efficient. And all of the methodologies to do that

15 are very detailed in the TSD.

16 And then with costs, longer cords cost

17 more. So, the cost would have gone up.

18 Higher output power tends to cost more.

19 Again, cost would have gone up.

20 And then markups, this is what we're

21 going to look at in a bit more detail. So, just so

22 we're all speaking the same language, I know we

23 were just talking about different types of
220

1 overheads and what not, but the key thing here that

2 I want to stress is we're looking at how we go

3 from the components to the final purchaser

4 of the product.

5 And from the engineering analysis perspective,

6 what we really care about is the EPS manufacturer,

7 or what people sometimes refer to as the ODM,

8 original design manufacturer, who then sells that

9 power supply to the OEM, the original equipment

10 manufacturer.

11 So, you know, when you go to buy your

12 Dell laptop, you're going to see "Dell" written on

13 your EPS, even though it might have been made by

14 Astec or Phihong. So, the different system OEM is

15 the guy who has his name on the product.

16 And along this chain is the three

17 specific curves that we looked at: bill of 

18 materials, the raw materials, manufacturing

19 production costs, factory costs, what's going out

20 of the factory, and then finally manufacturer's

21 selling price, which would then account for things

22 like Wayne was talking about, research and

23 development costs and that type of thing.
221

1 And that's what the ODM sells to, to,

2 price at which the ODM sells the EPS to the

3 OEM. Lot of acronyms there.

4 Okay. And so now, now that we have all

5 of our data scaled and it's all equivalent, look at

6 our unit and see its cost-efficiency relationship.

7 MR. ALBERT: Excuse me, Mike. I'm Larry

8 Albert.

9 So, did you then also consider the

10 markup to the consumer?

11 MR. VLADIMER: Yes, but that wasn't at

12 this point in the analysis.

13 MR. ALBERT: Oh.

14 MR. VLADIMER: So, you know, the

15 engineering analysis gets it up in this MSP, and

16 later on we have in the presentation, we have a

17 product price determination that's going to come up.

18 And they'll explain how you get from this to the

19 final price.

20 MR. ALBERT: All right. Sorry.

21 MR. VLADIMER: Good question. Okay.

22 So, just looking at the final outputs

23 from the engineering analysis, because 
222

1 DOE generated two output results and

2 welcomes comment on them. And one thing I just

3 want to point out, actually, before we get too far

4 into this. Before, people were talking about

5 negative slopes, and what that means.

6 So, the first slide we showed that

7 hockey-stick shaped curve, you know, increasing

8 efficiency tends to increase cost. And

9 what they were referring to was this relationship

10 from the test and teardowns that you see here,

11 where the increased in efficiency actually results

12 in a decrease in cost.

13 MR. BROOKMAN: Yes, please. This is

14 Mike Rivest.

15 MR. RIVEST: I wouldn't say results --

16 MR. BROOKMAN: This is, this is what --

17 MR. RIVEST: If it's causing a spike,

18 spike the outputs, the engineering --

19 MR. BROOKMAN: Mike, this is what you

20 were referring to earlier, right?

21 MR. RIVEST: Right. So, it's not less

22 expensive because it's more efficient, but those

23 two, those two traits came hand in hand in our
223

1 teardowns. And we're looking for reasons for that.

2 MR. BROOKMAN: Yeah.

3 Dan first.

4 MR. TENINTY: Yeah. The first thing

5 that I notice here is that the manufacturer

6 interview data doesn't match the theory based on

7 the teardown.

8 And that would seem to suggest that your

9 theory doesn't match the data, and that perhaps you

10 need to modify your, your model.

11 MR. VLADIMER: Any suggestions how?

12 MR. TENINTY: Well, there are some

13 assumptions made in the teardown that you've,

14 you've stated, and also in your scaling, that

15 perhaps are inconsistent with -- I mean, it shows

16 very consistently that there's, there's a diametric

17 opposition in the directions the curves are going.

18 MR. VLADIMER: Yes.

19 MR. TENINTY: The manufacturers, because

20 they're in the business with, I would tend to

21 believe that their data most accurately reflects

22 the, the costs or the price information, and that

23 the testing and teardown by the third party, it
224

1 seems as if they're missing something, because,

2 again, the curves go in opposite

3 directions. That's the inference.

4 MR. RIVEST: I think that the third

5 dimension that's missing is time. So, a

6 manufacturer that's looking at today’s costs of

7 making this product more efficient, you know, is,

8 is working on today's technologies, and our, our

9 test and teardowns were buying products over a

10 period of a year which may have been designed, you

11 know, over several life-cycles of EPSs, and, you

12 know, reflect the best thinking at the time that it

13 was designed.

14 And the factories keep making those

15 designs until, you know, they have the

16 money to invest in a new

17 design. At some point the variable cost penalties

18 might exceed the available cost requirement.

19 So, so -- And that's completely

20 different in this industry than in

21 air-conditioning, where, to make it more efficient,

22 you add more pounds of steel. This is very

23 life-cycle driven, and very short life-cycles.
225

1 And, and I think, you know, this is the

2 reality of electronics.

3 MR. BROOKMAN: So, the fact that you did

4 teardowns over the span of a year or more, are

5 those, those cost reductions will be reflected?

6 MR. RIVEST: I believe that, you know,

7 the most, the most efficient product was the one

8 that was designed most recently.

9 MR. BROOKMAN: Yeah. Okay.

10 MR. PETROLATI: And we did -- Vic

11 Petrolati, Department of Energy.

12 And we did get comments from the

13 manufacturer interviews in terms of what potential

14 things we would want to control in terms of our

15 teardowns in the future, specifically. Mike, I

16 think you wanted to have some of those, but

17 reliability of the EPSs.

18 In some cases we tested an EPS that

19 might have been for a laptop computer within that

20 product class, versus an EPS from a different

21 product. They felt, from the standpoint of making

22 sure that all the costs were normalized and that

23 the product had been designed to the same
226

1 reliability, that we would have to test EPSs

2 specifically for laptop computers to get similar

3 reliability characteristics built into those

4 products.

5 So, we did get some comments from the

6 manufacturer interviews already that we haven't

7 gone over here in terms of why our cost efficiency

8 curves may have shown some inappropriate results.

9 MR. VLADIMER: Again, it's

10 detailed in the TSD. And I definitely appreciate

11 your input.

12 And maybe I wasn't clear in the scaling,

13 because you were talking about how the scaling

14 might have affected if the same scaling operations

15 were performed on the manufacturing

16 data. So, for instance, you know, if manufacturers

17 talked about a 20-watt EPS, and gave us data, we

18 tore down and we had to normalize it back to 18 watts.

19 It was the same techniques in both

20 cases.

21 MR. TENINTY: Okay. Dollars per watt,

22 or --

23 MR. VLADIMER: Exactly. Same cost
227

1 scalings, same efficiency scalings, same, same

2 everything.

3 MR. TENINTY: I mean, it seems an

4 obvious disconnect that, that would seem to imply

5 that there is a, something missing in the model.

6 MR. BROOKMAN: So, let me reiterate that

7 the Department's inviting additional thoughts on --

8 MR. PETROLATI: Right.

9 MR. BROOKMAN: -- these curves and how

10 this phenomenon might happen or might not happen;

11 what's missing. And Dan has a start on it.

12 I'm hoping that some other manufacturers

13 can help.

14 MR. ALBERT: Just a question for Mike.

15 Larry Albert. Sorry.

16 MR. VLADIMER: Your mic.

17 MR. ALBERT: Sorry. I'm sure your

18 answer's going to be it's in the TSD, but I'm going

19 to ask the question anyway.

20 The iSuppli analysis, they must have had

21 an exemplar unit that they were essentially

22 creating to achieve the target CSLs, I assume.

23 MR. VLADIMER: I'm not sure what you
228

1 mean by "exemplar unit."

2 MR. ALBERT: In other words, when you

3 asked them to do a teardown analysis, was a

4 teardown of an existing product, or was it a

5 teardown of this sort of theoretical --

6 MR. VLADIMER: It is in, in the TSD, but

7 I'll show you.

8 MR. ALBERT: Thank you very much.

9 MR. VLADIMER: So, like I said, every

10 unit here was a unit that DOE tested. The three

11 units that are in bold and green, 949, the 118, and

12 941, those units were sent to iSuppli.

13 So, DOE's test lab measured their

14 efficiency, and then iSuppli opened them up and

15 calculated their costs.

16 MR. ALBERT: Okay. So, they costed out

17 existing units, right?

18 MR. VLADIMER: Yeah.

19 MR. ALBERT: Right. And is that

20 information protected, or -- So I, I would imagine

21 it is, right?

22 That's not detailed, that's not detailed

23 in the TSD.
229

1 MR. VLADIMER: The cost for all of

2 these is definitely detailed in the TSD, the

3 per-component BOM costs.

4 MR. ALBERT: Yeah.

5 MR. VLADIMER: I don't think that's

6 published.

7 MR. ALBERT: Okay.

8 MR. BROOKMAN: Ric.

9 MR. PETROLATI: Yep.

10 MR. ALBERT: So, I just want to make

11 sure I'm clear. So, when they tore these down,

12 they got the, each individual component, and then

13 they called those component manufacturers, and

14 based on a million pieces, they got the price for

15 each of those components to build that EPS back up;

16 is that correct?

17 MR. VLADIMER: So, I don't

18 know how. You said that they called the component

19 manufacturers. I don't know.

20 MR. ALBERT: Well, how would you get the

21 costs if you didn't ask?

22 MR. VLADIMER: Sure. They have a

23 database.
230

1 Their job, as they say, is that they

2 have a bunch of people in China and elsewhere that

3 are constantly researching market values for each

4 component, and in which volume. So, their

5 proprietary contribution is this database they have

6 of all these components and their costs.

7 During the manufacturing interviews,

8 manufacturers had generally said that they had seen iSuppli’s

9 teardowns and that they were generally in the

10 ballpark. So, I mean, exactly how they got the

11 numbers, you'd have to --

12 MR. RIVEST: Yeah. iSuppli is in the

13 business of supplying part of the components' costs

14 to manufacturers, you know, as a benchmarking tool.

15 And, and it's a service.

16 You pay, like, $20,000 a year. So, they

17 don't necessarily have to make a call specifically

18 on the product.

19 They would make the call, I suppose, if

20 there was an IC chip that was not proprietary. And

21 they have to make their own estimates when it's a

22 proprietary chip.

23 MR. ALBERT: And I guess I just want to
231

1 make a comment that, you know, we have run into

2 this in the actual real world, that when you get a

3 chip that has a certain feature that provides a

4 certain function, you pay for that chip. I mean,

5 you pay more than the going rate of what that

6 standard chip would cost because you're paying

7 something for intellectual property, something

8 that's been developed.

9 And I'm hoping that that was taken into

10 account, and I'm hoping that some of the disconnect

11 from the curves here is that there were

12 intellectual property costs that were tacked onto

13 that which would otherwise be a standard type of IC

14 that, that you're not capturing in these costs.

15 I don't know that. That's just an

16 assumption.

17 MR. VLADIMER: Sure. I think that

18 iSuppli definitely knows that silicon is not just silicon

19 ; that there's costs for IP.

20 That's what their job is. I think

21 everyone's focused on the disconnect between the

22 two curves, and I think that fundamentally the

23 theory is if you hold everything
232

1 constant except for cost and efficiency, you should

2 have a certain response.

3 And the question for the

4 stakeholders is: Is something not being held

5 constant? Mike was mentioning time.

6 Vic has mentioned reliability. What

7 might -- What factors might not, might not be held

8 constant that are giving these results?

9 Or, are the results

10 just valid on their face? You know, that's another

11 possibility.

12 MR. BROOKMAN: Larry.

13 MR. ALBERT: Mike, did you, did you

14 attempt to validate their process by taking the

15 existing EPS for which you did know the

16 cost of the end product, and asking them to cost it

17 out as a validation of their process?

18 MR. VLADIMER: Short answer

19 is no. But, the, the thing, the problem with EPS

20 is, is that we could look at the end products.

21 And so if we want, we could go buy a

22 replacement power adapter. But, the problem is,

23 you know, you pay 25, 50 bucks for a power adapter,
233

1 and that price, even if you follow our markup

2 chain is not going to get you back to the

3 original BOM.

4 MR. ALBERT: I was really speaking about

5 the case where you had NDAs with manufacturers

6 where they shared with you their factory costs, and

7 therefore you had a, a pretty accurate benchmark.

8 And then, sort of like, again, R&R for the process

9 or something.

10 MR. VLADIMER: I see what you're saying.

11 MR. RIVEST: That's actually what the

12 manufacturer data is.

13 MR. ALBERT: So, that's for the same

14 units?

15 MR. RIVEST: Yes. No, not the same

16 units, but -- So, the people we interviewed

17 manufacture, you know, power supplies.

18 And, and some provided extremely

19 detailed information on their costs. And, and they

20 were aggregated, depending on the product class.

21 There was anywhere from four to eight,

22 maybe, manufacturers that provided data. We looked

23 at the spreads.
234

1 I mean, there was definitely a spread in

2 costs, but there's a central tendency. It's not

3 even a central tendency.

4 It's, it's, like, a lot of people are

5 about the same, and then there's a few outliers

6 higher. There's -- Nobody's ever low.

7 So, it's either, like, they really know

8 their costs or they're not taken the time to answer

9 the questions.

10 MR. BROOKMAN: Larry.

11 MR. ALBERT: Yes, but the question

12 really was about validating the process -- Right?

13 -- by taking essentially the same unit and pricing

14 it through a manufacturer, manufacturer, and

15 pricing it through iSuppli to find out what the

16 correlation was, like a gauged R&R consideration

17 study, right?

18 So, --

19 MR. RIVEST: I think that's

20 something we could do right now. That's a great

21 idea.

22 MR. VLADIMER: Yes. It was not done,

23 and it is a great idea we could do.
235

1 MR. RIVEST: Go back to -- Go back to

2 that manufacturer who, who supplied the teardown,

3 and bring it, it to them and say --

4 MR. ALBERT: Or vice-versa. It doesn't

5 matter the one that, you know, detailed

6 manufacturing on, but is pretty high efficiency.

7 So, that depends on iSuppli.

8 MR. RIVEST: That's a good idea.

9 MR. BROOKMAN: Vic is --

10 MR. MORRIS: Could I -- Same thing of

11 thought, and then ask them for the same analysis at

12 several different quantities so they could, you

13 know, validate it at the quantity that the

14 manufacturer told you they were building, which is

15 your baseline, or your, you know, essentially your

16 gauge and RR base.

17 And then, then gauge it at different

18 quantities going downward will give you a

19 range, and it will tell you what that

20 curve looks like that begins to approximate

21 that relationship of quantity to

22 the actual manufacturing cost.

23 Because I think that would be a real
236

1 important -- And I would also, in fact, -- Back to

2 the original question that was asked. -- that,

3 Michael, I think you're right about time

4 being an important variable.

5 I know that when

6 you say you, you have to do these you can't base it

7 on price because price comes in at another level in

8 this equation, but price has an inverse

9 relationship to this situation as well, because if

10 you're building a power supply for a $250

11 MP3 player, and you're building an EPS for a $17 product, your engineering 

12 cost reflected

13 in that gives a lot more flexibility in terms of

14 output, do I put 50 engineers on this, or do I put one

15 guy half-time on this?

16 I mean, I think that the

17 relationship to, to small companies is such that

18 they, in many cases, don't have that. And so they

19 may not be able to design the most efficient power

20 supply at the same ratio of cost structure to them,

21 because they, they simply don't have the

22 capability.

23 They don't have the time and the
237

1 effort involved in this. So, I think that that,

2 while, while certainly time and time in

3 marketplace, I think engineering ability of that,

4 of that small firm has to play a part in this

5 situation.

6 How in the world you, you calculate that

7 or equate that into these two curves, I'm not

8 sure you can. I think the other element in this is

9 that we're in a new world. And you spoke about it

10 earlier.

11 You know, with a refrigerator, if you go

12 to more efficient, you go to two compressors and we

13 can add up the costs of two compressors pretty

14 simply, pretty easy. Everybody knows how to do

15 that.

16 You call up a, compressor manufacturer.

17 I ask them two versus one.

18 Not too much of a rocket science. You

19 probably wouldn't need 30 people from Navigant.

20 Now we're in a whole in a new world.

21 Now we see why we've got so many consultants,

22 because it is complicated.

23 And it is something that takes a lot
238

1 more brain power to do these situations. And

2 that's probably why we were seeing --

3 MR. BROOKMAN: Vic Petrolati, comment?

4 MR. PETROLATI: No, I'm going to defer

5 my comments. But, I want to mention that we're

6 still not even halfway through the engineering

7 analysis and we're completely impacting our

8 schedule for finishing by 5:00 o'clock.

9 MR. BROOKMAN: Right. Okay, we'll keep

10 moving.

11 Okay.

12 MR. VLADIMER: Excellent. Well, thanks,

13 everybody, for those very valuable comments.

14 So, I'll continue, and try to be quick.

15 So, as I mentioned earlier, there's a relationship

16 between voltage and efficiency, and AC or DC output

17 and efficiency.

18 And so, in brief, the idea was, you

19 know, product classes A1 and A2 have the same AC/DC

20 output, but A2 is low-voltage, so let's have the no-load

21 requirements be the same as A1, but make its

22 efficiency requirement less stringent.

23 And I think you can see how that
239

1 extrapolates to A3 and A4. So, here we have A1 and

2 A2, or, I'm sorry, A2 and A4.

3 These are the lower, less-stringent

4 efficiency requirements. Essentially the idea was

5 ENERGY STAR for 2.0 provided an offset.

6 They slightly reduced the inefficiency

7 standard for their low-voltage EPSs, so DOE

8 used that same offset for CS1 and all the higher

9 CSLs. Similarly, for no-load power, ENERGY STAR,

10 rather than having a tiered no-load Standard, they,

11 they have just a flat Standard that was the

12 least-efficient Standard out of that tier, and

13 that's what you see here as well.

14 Okay. So, cost estimates, I want,

15 probably want to open this up to comments, but I

16 think you guys have just given us a lot of

17 comments.

18 The key thing that this is trying to say

19 is that because of the CSLs for A2, 3, and 4 are

20 slightly reduced in stringency, as opposed to A1.

21 DOE thinks that their incremental costs for

22 achieving the CSLs would then be the same.

23 So, what that means is, you know, for a
240

1 60-watt power supply, we're saying before, to meet

2 for CSL1, it has to be 87 percent. If it's

3 low-voltage, now it only has to be 86 efficient.

4 So, you know, before, it cost you a

5 quarter to get to that 12 volts. You would be at

6 87.

7 Now that you're only at five volts we

8 appreciate it's harder, but spend that same

9 quarter, but you only have to get up to 86. So,

10 the engineering costs are the same.

11 That's the idea.

12 MR. BROOKMAN: Let's just speak quickly,

13 keeping moving on,

14 MR. VLADIMER: Okay. Keep

15 moving me on.

16 Non-Class A, essentially there was a

17 determination analysis that we're building on,

18 for this analysis. So, the inputs for

19 multiple-voltage and high-power EPSs are going to

20 come from the determination.

21 And inputs for medical and MADBs are

22 going to come from Class A EPSs, but the

23 methodology is going to be the same for both. It's
241

1 going to be consistent with Class A.

2 So, for instance, in the Determination

3 Analysis, DOE only looked at the costs of

4 efficiency-related components. But, now, for Class

5 A, it looks at the cost for all components.

6 So, looking at non-Class A again, 

7 it will be consistent with Class

8 A. 

9 Informally we've talked a lot 

10 about MADBs, so we'll get through that quickly.

11 So, again, just, same engineering structure as in

12 the Determination Analysis. The idea would be to

13 generate the cost-efficiency curves for these three

14 representative units, take the data, the original

15 data from the determination, apply it to the

16 methodology for Class A, and get your outputs.

17 Okay. And for medicals and MADBs, the

18 idea is that by using the, at least by using the

19 ENERGY STAR criteria, and DOE has that as a

20 proposed method for right now, and I think there's
242

1 a lot of good discussion about that, this.

2 So, we don't have to go into it right

3 now, but if DOE were to follow that path,

4 then essentially the cost efficiency curves for

5 medical and MADBs DOE believes are the same as

6 those of Class A. So, for instance, for a medical

7 EPS where the safety requirements are more

8 stringent, it will have a thicker plastic

9 case. The costs of the components, when

10 you have to look at the incremental

11 costs of going from one efficiency level to

12 another, maybe the absolute costs are a little bit

13 higher, but the incremental costs are going to be

14 the same.

15 That's what this says.

16 MR. BROOKMAN: Larry.

17 MR. ALBERT: I'm sorry, Michael. I'm

18 still not clear.

19 So, are you suggesting that, that we can

20 use the same curve for the Class A EPSs and apply

21 it to the MADBs straight up? Right?

22 MR. VLADIMER: Yes.

23 MR. ALBERT: Without -- All right. But,
243

1 even though -- But, have you done any analysis on

2 MADB supplies -- Right? -- to provide a baseline

3 population?

4 Because you're talking about incremental

5 costs, correct?

6 MR. VLADIMER: I'll give

7 you the thinking behind this. The

8 thinking, I think, is straight-forward.

9 So, let's get through

10 that. So, the idea is: How do we identify MADBs?

11 We identify them by using

12 ENERGY STAR criteria. And if you believe that you

13 applied that criteria and that criteria's valid and

14 that's the whole assumption.

15 But, if that's valid and you have a MADB

16 that, according to this, does not have charge

17 control, then DOE believes it has the same circuit

18 as a --

19 MR. ALBERT: I see.

20 MR. REEVES: I don't think so. The

21 question really is: If the Department goes

22 back and reevaluates the criteria that they use for

23 MADBs, which I thought I heard might be a
244

1 possibility this morning, -- Right? -- and they

2 come to some other, this conclusion that they're,

3 the only difference for them is not a switch in the

4 indicator, then would that warrant using a

5 different methodology, perhaps, for MADBs?

6 Or, do you believe that no matter what

7 the criteria is for establishing it, it shouldn't

8 matter?

9 MR. VLADIMER: No, I think there was a

10 great discussion this morning. And I can't tell

11 you how DOE's going to go forward in the future,

12 but all this says is if, if we look at the power

13 supply and it doesn't have charge control, and it

14 happens to power an MADB product,

15 then its cost efficiency curve is going to be the

16 same, because as far as DOE can tell, its guts, its

17 circuitry is the same.

18 For anything else, I'd actually probably

19 defer to Vic.

20 MR. BROOKMAN: Ric.

21 MR. ERDHEIM: This here comment's

22 related to medical. And you, did you study medical

23 products that would have higher-efficiency EPSs
245

1 versus ones that didn't?

2 And the reason I bring that up is

3 because the medical device Standard UL

4 requirements, they're much more stringent linkage

5 current, linkage current requirements. And so I'm

6 not all for sure what that's going to entail when

7 you potentially switch from a linear supply to a

8 switch mode.

9 So, so was any of that looked at when

10 you were making this determination in the medical

11 area arena?

12 MR. VLADIMER: We didn't look at

13 specifically going from linear to switch mode, but

14 I can tell you that we interviewed manufacturers

15 that do make medical applications, and the story that I got from them was 

16 there's

17 design factors that affect efficiencies.

18 There's design factors that affect

19 medical compatibility, and once you have your

20 medical compatibility taken care of, be it leakage

21 or otherwise, that once you start ratcheting up

22 efficiency, you're not going to have, it's not
246

1 going to necessarily affect the medical side.

2 If that's not the case, I highly

3 welcome comment, or even tell somebody from DOE

4 who they should speak with and they can do a

5 manufacturer interview. But, as far as our input

6 at this point, we think that's the case.

7 MR. PETROLATI: What about our test

8 results, Mike?

9 MR. VLADIMER: So,

10 we did two test and teardowns for medical EPSs, and both of those

11 exceeded the Standards.

12 MR. BROOKMAN: Okay.

13 MR. VLADIMER: Okay. So, the last

14 point, just to mention, is that because medical and

15 MADB EPSs are not currently covered under EISA, as

16 noted in the market assessment, there's a chance

17 that some of those products in the market might,

18 just that some of the products might be below

19 statutory efficiency levels.

20 But, as far as conducting this analysis

21 for the, for the NOPR is considering not analyzing

22 those lower than EISA EPSs, and, say, just grouping

23 them in with EISA-compliant EPSs as a simplifying
247

1 alternative.

2 Excellent. So, any thoughts on that

3 would be welcome.

4 Probably best in writing at this point.

5 So, let me hand off to my colleague, Matthew

6 Nardotti, who's doing the industry battery chargers

7 engineering.

8 ENGINEERING ANALYSIS

9 MR. NARDOTTI: Good afternoon. I'm

10 Matthew Nardotti, from Navigant Consulting, and I'm

11 going to present the engineering analysis for

12 battery chargers.

13 As with the engineering analysis for

14 external power supplies, the purpose of the BC

15 engineering analysis is to evaluate design options

16 that improve efficiency and characterize

17 manufacturing costs versus efficiency for higher

18 efficient equipment.

19 To begin this analysis, DOE reexamined

20 the product classes that it developed in the market

21 assessment. For easy reference, the ten product

22 classes are reproduced right here.

23 From each of these product classes, DOE
248

1 selected a representative unit which it would analyze

2 in more depth. As the name suggests,

3 representative units are meant to character-, to be

4 characteristic of the product class that they

5 represent.

6 Therefore, when selecting representative

7 units, DOE attempted to identify the combination of

8 battery voltage and battery energy most common for

9 each product class. The results of these

10 selections are presented on this table.

11 Subsequently, DOE focused its

12 engineering analysis on these representative units,

13 which ultimately means that DOE produced a curve

14 for cost versus efficiency for each of these units.

15 DOE requests any feedback on the appropriateness of

16 its choices.

17 MR. BROOKMAN: Yes, Larry.

18 MR. ALBERT: Thank you. Larry Albert.

19 Just, just to clarify the process here

20 so I understand it, so, this was somewhat similar

21 to the EPS thing where you picked the

22 representative unit and you looked for actual units

23 that were close to if not right on -- Right? --
249

1 those characteristics?

2 MR. NARDOTTI: Exactly.

3 MR. ALBERT: Then you costed those out

4 in the same, same manner?

5 MR. BROOKMAN: (Nodded yes.)

6 MR. ALBERT: And so for products that

7 are, say, a higher voltage or a higher watt-hour

8 capacity or something like that, where, where did

9 they fall, and how would they have been treated?

10 MR. NARDOTTI: So, that is

11 something that we're going to get into, product

12 scaling within a product class. But, in a couple

13 of slides.

14 MR. BROOKMAN: Wayne?

15 MR. MORRIS: Well, maybe I'll wait, too.

16 MR. BROOKMAN: Okay. Okay.

17 MR. NARDOTTI: For each representative

18 unit, DOE examined the impacts on costs of

19 improving the efficiency by characterizing four

20 candidate standard levels. The first three of

21 these CSLs that DOE examined were based on units

22 available in the market.

23 The analysis starts with CSL 0, which is
250

1 representative of the least-efficient products on

2 the market. That increased to intermediate, CSL 1,

3 and ultimately CSL 2 reached the best in market.

4 CSL 3 was representative of the max tech

5 efficiency level, and this level was usually

6 characterized by manufacturers, and represents a

7 level of efficiency not currently available on the

8 market because of the high costs associated with

9 designs.

10 The metric that DOE used to characterize

11 each of these CSLs was a term called "Unit Energy

12 Consumption," "UEC." Or UEC is a, a (sic)

13 aggregation of, of non-useful energy consumed by a

14 battery in all modes, annualized over a one-year

15 period.

16 To calculate it, DOE calculates outputs

17 from the BC test procedure that it's currently

18 working on, and assumptions about product usage.

19 Through four different tests, DOE obtains five

20 values that are needed to calculate UEC.

21 Three of those values are, are obtained

22 through two tests that are represented graphically

23 on this slide. The two tests are metered charge
251

1 test and a metered discharge test.

2 For the metered charge test, one begins

3 with a completely depleted battery and monitors

4 input power to a battery charger for a 24-hour

5 period. At some point during the test, the battery

6 charger switches into maintenance mode and stays

7 there for the remainder of the test.

8 On this graph, that transition occurs

9 right around hour 15 of the test.

10 (Whereupon, at 2:37 p.m. ET, Mr. Albert

11 and Mr. Erdheim conferred, out of the hearing of

12 others and off the Record, during which the

13 following occurred:)

14 MR. NARDOTTI: The input power for the

15 final four hours of the test can then be used to

16 calculate the average maintenance mode power.

17 Additionally, the integral of the input power over

18 the 24-hour period gives us an output of the test

19 called 24-hour energy consumption.

20 (Whereupon, at 2:37 p.m. ET, Mr. Kido

21 and Mr. Petrolati conferred, out of the hearing of

22 others and off the Record, during which the

23 following occurred:)
252

1 MR. NARDOTTI: Finally, for the metered

2 discharge test you start with the, the fully

3 charged battery and monitor the discharge current,

4 and integrate power during that discharge to

5 get the useful battery energy that was consumed

6 during the 24-hour meter charge test.

7 The two other tests that DOE conducts,

8 if applicable, are a no-battery mode test and an

9 "Off" mode test. And for those tests it's simply

10 an average power, input power for a specified

11 duration of time that gives you the average power

12 in those modes of operation.

13 MR. BROOKMAN: Larry?

14 MR. ALBERT: One other question. You

15 have the charged time up there as one of the values

16 that you, you have.

17 The NOPR for the test procedure, does

18 that -- No, I don't think that had the charge time

19 in there as one of the outputs from the test

20 procedure.

21 MR. NARDOTTI: I, I believe that the

22 NOPR test procedure has had a term called "steady

23 state time" which is similar to what this, what
253

1 "charge time" was getting at.

2 MR. ALBERT: And, and, and that's where

3 you got that number, from whatever --

4 MR. NARDOTTI: Right. So, also for NOPR

5 test procedure, DOE proposed shortening the, the

6 24-hour charge, the 24-hour meter charge test when,

7 when the base, when the battery charger was seen to

8 go into maintenance mode.

9 However, there was push-back that

10 determining charge time can be difficult at times,

11 so I've illustrated it just for proof of concept on

12 this graph. But, it's no longer really a relevant

13 output of the test procedure that, that is needed.

14 MR. ALBERT: Okay. Thank you.

15 MR. NARDOTTI: So, the outputs of the

16 test, the five outputs of the test procedure: 

17 24-hour energy, battery energy, maintenance mode

18 power, no-battery mode power, and off-mode power,

19 are combined with average hours per day in each of

20 those modes to obtain an estimate for unit energy

21 consumption.

22 The actual calculation that DOE is using

23 is shown here. We will get into the details of the
254

1 usage profiles during the energy use section.

2 We welcome any comment on this

3 calculation.

4 MR. BROOKMAN: Larry.

5 MR. ALBERT: Yeah, again. So, I see

6 you've got, and as your number of charge per day

7 but, then it shows up again at 24 times then in the

8 second curve.

9 What's happened there? I mean, it's --

10 MR. LAMBERT: Michael Lambert.

11 So, in the beginning, when I first

12 mentioned tech assessment, and now the thing is at

13 the bottom of the slide, these are all good. But,

14 we want to wait to discuss them in detail in the

15 energy analysis.

16 MR. ALBERT: Okay.

17 MR. RIVEST: And now, just to -- We think

18 that these terms are combined. We'll see exactly

19 how these got there.

20 But, now, what's the relationship

21 between UEC and cost, is the, what we're trying to

22 find.

23 MR. ALBERT: All right. Thank you.
255

1 MR. NARDOTTI: I guess, to answer your

2 question, though, the meter charge test assumes

3 some time in, in, in charge mode and in maintenance

4 mode. So, to account for that, we have to

5 calculate for that in our maintenance per day in

6 maintenance mode and charge mode.

7 MR. ALBERT: Yeah, right. Yeah.

8 MR. NARDOTTI: So, the next two slides

9 contain UEC values that DOE calculated for each CSL

10 and for each product class. And as you'll notice,

11 a higher candidate standard level means a lower

12 energy consumption.

13 Also note that these candidate standard

14 levels are only applicable to the representative

15 unit. In other words, not all products that fall

16 within one of these product, product classes would

17 need to be bound to the UECs that are shown here.

18 Scaling these CSLs to levels appropriate

19 for other units is something that we're going to

20 get into, and we're hoping to get feedback on today.

21 So, to generate costs versus energy consumption,

22 just like in UPSs, DOE used two approaches.

23 The first was speaking directly to
256

1 manufacturers. So, during the preliminary,

2 preliminary analysis, contractors for DOE entered

3 into a nondisclosure agreement with several bat-,

4 several manufacturers of, of battery chargers.

5 Subsequently, the contractors visited

6 manufacturers and discussed costs for designs that

7 had specific performance parameters. For each of

8 the product classes, as discussed, the data from

9 manufacturers was aggregated and regressed to

10 obtain one equation that describes how cost would

11 change with regards to unit energy consumption.

12 This equation was then used to estimate

13 the cost to reach each, each CSL for a given

14 product class. So, as mentioned, DOE based its

15 calculations of UEC on performance parameters that

16 come directly from the test procedure.

17 To ensure that UEC decreased with each

18 subsequent CSL, regardless of usage profile

19 assumptions, DOE made sure that the parameters in

20 each mode of operation improved from one CSL to the

21 next. The chart on this slide, slide shows

22 aggregate performance perimeters.

23 Oh, I'm sorry. I'm sorry.
257

1 That -- The, the chart on this slide

2 shows aggregate performance parameters taken from

3 the data discussed with manufacturers. I would

4 like to highlight a couple of columns here, the

5 estimate, estimated time in active mode, and

6 active-only system efficiency.

7 Because the concept of UEC and 24-hour

8 energy is not something that battery charger

9 designers and manufacturers are used to dealing

10 with, it was often necessary to talk about these

11 parameters when we met to discuss specific designs.

12 MR. ALBERT: So -- Sorry.

13 MR. BROOKMAN: Larry.

14 MR. ALBERT: Larry.

15 I've noticed the estimated time in

16 active changed as you went from CSL to CSL. Isn't

17 that one of those things that you're supposed to be

18 holding constant, or is that these happen to be the

19 case in specific units you looked at?

20 MR. NARDOTTI: Right. So, these would

21 be specific designs that manufacturers discussed

22 from us, discussed with us.

23 MR. ALBERT: And so -- But, you're not
258

1 sure, for example, if you were to have a longer

2 active, time in active mode, what effect that that

3 would have upon the UEC?

4 MR. NARDOTTI: It would be, likely, to

5 increase the, the 24-hour charge energy, 24-hour

6 energy consumption, but --

7 MR. ALBERT: So, the concern here is if

8 a manufacturer has a charger right now that, for

9 the utility of the product, -- Right? -- needs to

10 be three hours, no faster, six hours, no faster,

11 then as they go from CSL to CSL is there an

12 assumption that they're going to have to basically

13 go to shorter charge times to achieve the higher

14 efficiency, and, and therefore, you know, provide

15 a, a faster charger than the application would

16 demand?

17 MR. NARDOTTI: Do I --

18 MR. RIVEST: Excuse me. Mike Rivest.

19 I don't know that we can, you know, that

20 we can make conclusions about the impact of charge

21 time on the UEC because of the way the equation is

22 written.

23 MR. MORRIS: But, you did, Mike. And,
259

1 you know, and you see the 24-hour energy and the

2 way it's calculated, unless you know for a fact

3 that, all things being equal, that a faster charge

4 time means a better UEC, you know, I don't know how

5 we can conclude anything.

6 The idea was simply to show that these

7 were actual units being purchased, being sold. And

8 also what it, it does show is that there are many

9 ways that you can design your product, and that it

10 will contain the same UEC so you have the ability

11 to optimize your design at the lowest cost to meet

12 that UEC through any of a these parameters, active,

13 active energy, maintenance energy, stand y powers.

14 MR. ALBERT: So, at Standby 2 were you

15 able to find a 13-hour charger to meet those?

16 MR. RIVEST: Is a 13-hour -- Why would

17 that matter? I don't understand?

18 MR. ALBERT: Well, it depends on the

19 chemistry to some extent, but it can matter.

20 MR. RIVEST: But, isn't faster always

21 better?

22 MR. MORRIS: No.

23 MR. ALBERT: Well, it might be better,
260

1 but consider it better or not, it's not equivalent.

2 Right?

3 I mean, the question here is -- This is

4 to the earlier question about utility and, utility

5 and price versus performance and price versus

6 efficiency, and whether indirectly you were

7 directing a, certain utility -- Right? -- by

8 suggesting that any improvement in utility is

9 automatically justified if it's accompanied by

10 efficiency.

11 MR. RIVEST: You know, I see it as a

12 dependent variable. So, we're not regulating

13 time, but we are taking into account all the costs,

14 you know, that are represented by going up, going

15 down, the UBC.

16 If it happens that there is also a, an

17 additional benefit, I call it a benefit, assuming

18 that less time is better, -- Wayne is, is nodding,

19 "No, no, no." But, if, if -- I cannot conceive of

20 an application where I would want to take more time

21 to charge my battery unless it was cheaper to do it

22 that way.

23 And what I'm saying is cost is, is
261

1 embedded in this calculation. There's no need to,

2 to, to, to draw --

3 MR. ALBERT: So, let me make comparison

4 between CSL 0 and CSL 2, a 13-hour to a one-hour

5 charger.

6 MR. RIVEST: Um-hum.

7 MR. ALBERT: Obviously, for the same

8 capacity battery -- Right? -- you need to have a

9 higher output power, power pad, right?

10 Was that factored into the cost

11 analysis? I think I asked the question before and

12 Mike said, "Yeah."

13 Is that correct?

14 MR. RIVEST: I guess I'm not

15 understanding.

16 MR. ALBERT: In other words, if you take

17 a 13-hour charger and go through the calculation

18 with a 20-watt battery pack, -- Okay? -- and so

19 that's roughly -- What does that work out to be?

20 It's, it's -- You -- In the, in the CSL

21 2 case you need to have a minimum of 20 watts,

22 20-watt output power source, right? In the other

23 case you need about three-quarters of a watt --
262

1 Right? -- to achieve -- Right?

2 MR. RIVEST: But, but these are actually

3 units that, that were purchased or specified by the

4 manufacturer. So, we didn't, like, reverse

5 engineer these things.

6 I mean, we didn't. So, okay, that would

7 all be embedded.

8 MR. ALBERT: You took the costs of those

9 units, right?

10 MR. RIVEST: Right.

11 MR. ALBERT: You compared them to the

12 efficiencies.

13 MR. RIVEST: Right.

14 MR. BROOKMAN: Wayne.

15 MR. MORRIS: But, you're making the

16 assumption -- You're making the assumption, though,

17 on a couple of things here. One, you're making the

18 assumption that, that just because you've chosen

19 this representative, and then that's what's going

20 to be for everybody in that class of product.

21 MR. RIVEST: No, this is, this is

22 illustrative. If you, if you look at our, our

23 engineering interviews, for example, we, in fact,
263

1 got all sorts of design paths.

2 And so this is literally illustrative.

3 The only thing that matters here is the UEC that we

4 specify.

5 How you get there, you know, can be done

6 all sorts of different ways. And that's the beauty

7 of the UEC.

8 So, it, it's not prescriptive. You

9 don't have to meet any one of those individual

10 metrics.

11 MR. MORRIS: But, yeah. I want -- And I

12 want to go back to the, the other point that you

13 raised earlier about faster being better.

14 It's not. I mean, because in many

15 cases, "better" means now that I've got to charge

16 more for that because you're assuming that that's a

17 feature that somebody would, in fact, pay for.

18 But, they don't, because if I have my

19 electric razor and it runs down to here, to the

20 point where this little light comes on that says

21 "Time to charge it," okay. So, after I finish

22 shaving on that particular day, put in a new

23 charger.
264

1 I'm not going to go shave in another

2 five minutes.

3 MR. RIVEST: Okay, faster is not better,

4 but faster is never worse

5 MR. MORRIS: It's, it's, it's, it's an

6 unworthy response. It, it doesn't, it doesn't

7 benefit you anything if nobody wants it.

8 MR. RIVEST: I know. But, in our

9 cost-benefit analysis we're not saying, "Okay, now

10 we will monetize the increased utility of faster

11 charge."

12 If I was doing that, then definitely I

13 wouldn't -- You know, I'd have to examine whether,

14 in fact, that shorter is better. But, I'm not

15 assuming -- We're not calculating additional

16 benefits.

17 It's, it's a side benefit for some

18 people, and it comes with the economic analysis of,

19 of --

20 MR. MORRIS: But, if it's a side benefit

21 that nobody wants, --

22 Sorry. It's Wayne Morrison.

23 -- that you can't sell it in the
265

1 marketplace, --

2 MR. RIVEST: Right now it's assumed that

3 nobody wants. Right now it's a side benefit that

4 nobody wants and we don't give a value to.

5 MR. LAMBERT: This is Michael Lambert.

6 Just to focus on the real key thing

7 here, it's, the idea is that somebody's going to

8 buy that shaver and spend however much money. And

9 when they buy it, they're committed to paying

10 whatever the energy costs.

11 And by going to higher CSL, they're

12 spending more money. And if DOE were to set a

13 Standard, what we're talking about here, and the

14 focus is saving money over the life-cycle of the

15 product, the fact that it charges faster, Mike is

16 trying to say that's a side benefit, but it's not

17 what we're driving at.

18 But, you know, it's how things --

19 MR. RIVEST: If "more efficient" meant

20 slower, then we would be reducing utility and then

21 setting up a class.

22 MR. MORRIS: Wayne Morris.

23 And I agree. And, Michael, if that were
266

1 all that we were doing here, I would agree that

2 there's no problem to that.

3 The difficulty is, is that we're using

4 representative $2,000 notebook computer situations

5 to represent an entire class of product that's, in

6 fact, include products that are $20 and operated in

7 completely different characteristic, but because of

8 the voltage range or the output range, we've lumped

9 them into one class or category.

10 MR. RIVEST: Right. And --

11 MR. MORRIS: And that is what my problem

12 is. My problem is not that you've got this data

13 and there's great people out there at Sony or Dell

14 designing fast laptop computers.

15 My problem is that we're making the

16 assumption that everybody who makes a cordless

17 rechargeable vacuum cleaner wants to then put the

18 same amount of effort into designing a charger for

19 purposes of doing it just because we meet a

20 candidate Standards level, when, in fact, you get

21 no side benefit from it and the consumer doesn't

22 realize anything.

23 And, in fact, if I'm only plugging this
267

1 in for a couple of minutes or hours in an entire

2 year, I probably won't spend $1 a year.

3 MR. RIVEST: So, I think what you're

4 saying, there's two different things that are

5 really valid and interesting. So, one thing is the

6 cost efficiency analysis, the engineering analysis.

7 And the point which you just said is

8 true. You could have what an engineer does for a

9 laptop, and have another engineer do that for the

10 vacuum.

11 And the point -- And the key thing, and

12 this relationship that Matt's about to describe, it

13 holds true. You know, if they were to do that,

14 that would happen.

15 But, I think your, the problem is not

16 that this combination of possibilities is invalid.

17 The problem is when we lump them in together in

18 terms of usage and shipments and all that other

19 stuff.

20 So, I think it's important to

21 distinguish of: Could this happen? Could somebody

22 go from UEC of the 34 by taking a battery charger

23 and applying it to a power tool?
268

1 Yeah, they could. And it would cost a

2 bunch of money.

3 Does it make economic sense, because the

4 profiles are so different? That's a separate --

5 MR. BROOKMAN: We need a move on.

6 MR. ALBERT: Yeah. Final question just

7 to be sure here.

8 In these cases here where you identified

9 actual cases that reached CSL, were they able to

10 find a motor-operated appliance that filled CSL 2,

11 for example, or --

12 MR. NARDOTTI: We’ll get into that.

13 Couple sentences.

14 MR. BROOKMAN: Just a note. It's a

15 aspiration to give us a break in the span of ten

16 minutes, so keep going.

17 MR. TENINTY: Could I ask one clarifying

18 question? Dan Teninty.

19 Is it the intention of the, the DOE to

20 eventually require a particular CSL for a

21 particular type of product?

22 MR. RIVEST: A particular product class,

23 so not a particular --
269

1 MR. TENINTY: So, if you're inferring

2 that particular class and the DOE then says, "Okay,

3 now as of this date you have to be CSL 2," --

4 MR. RIVEST: Yeah. And that would apply

5 to the drills and the laptop.

6 MR. TENINTY: So, I understand now the

7 pushback a lot better, because the significance is.

8 MR. RIVEST: Is significant.

9 MR. TENINTY: -- large.

10 MR. MORRIS: Huge.

11 MR. BROOKMAN: So, Matt, keep going.

12 MR. NARDOTTI: Sure. Sure.

13 So, DOE purchased several battery

14 chargers with a variety of energies and voltages in

15 that product class. Each unit was then tested

16 according to the proposed DOE test procedure for

17 battery chargers.

18 After compiling the test results and

19 calculating the UEC for each unit, DOE selected

20 units with varying efficiencies and ratings similar

21 to the representative units for further

22 examination. First, these units were evaluated to

23 determine the presence of any energy-efficient
270

1 design options, and then they were physically torn

2 down in order to develop a bill of materials.

3 The evaluation of energy-efficient

4 design options was done by one of DOE's

5 subject-matter experts, and was in-, and included

6 exam-, examination of a general design of the

7 battery charger. After the evaluations were

8 complete, they were torn down by another DOE

9 contractor, iSuppli.

10 For each, each teardown, iSuppli

11 categorized components into one of three groups.

12 One, those components intended solely for battery

13 charging, such as the battery itself.

14 Two, those components intended for both

15 battery charging and non-battery-charging functions

16 such as a power supply. And three, those

17 components not intended for battery charging such

18 as a user interface component.

19 Components from Groups 1 and 2 were then

20 used to calculate a bill of materials. As with the

21 manufacturer data, the UEC for the test units was

22 calculated using the outputs of the test procedure,

23 and when DOE selected its units for evaluation and
271

1 teardown, it was again sure to choose units that

2 demonstrated improved performance in all modes of

3 operation.

4 Again, this was in order to ensure

5 that decreased UEC happened regardless of usage

6 profile assumptions. The table on this slide shows

7 some example test results that DOE obtained for

8 Product Class 4 during the preliminary analysis.

9 So, to answer your question, Larry, we

10 did find some power tools that demonstrated a UEC

11 as good as notebook computer for CSL 2 for this

12 product class.

13 MR. RIVEST: Yes. Mike Rivest.

14 So, as we saw, laptops tend to be all

15 clustered around the low UECs, and power tools are

16 in a range.

17 MR. NARDOTTI: And those test results

18 are in the Technical Support Document.

19 Once DOE obtained a bill of materials

20 from iSuppli, it then translated that bill of

21 materials into a manufacturer selling price. For

22 battery chargers, MSP, or "Manufacturers' Selling

23 Price," is the selling price to the OEM and is
272

1 alternatively known as the OEM's assembly or

2 factory price.

3 To translate the bill of materials into

4 a MSP, DOE used these. These numbers were actually

5 also given to us during manufacturer interviews.

6 I'd like to ask for any comment or

7 feedback on these numbers.

8 (Whereupon, at 2:59 p.m. ET, no response

9 was had.)

10 MR. NARDOTTI: So, finally, DOE

11 graphically depicted the results of manufacturer

12 interview data and its test and teardown data.

13 This slide shows the results for representative

14 unit for Product Class 4.

15 The results of the remaining product

16 classes can be found in the TSD. And, again, DOE

17 welcomes any comments on those results.

18 MR. BROOKMAN: Yes, Wayne.

19 MR. MORRIS: Wayne Morris, with AHAM.

20 I guess I'm, you know, trying to

21 appreciate where you're coming from, and I, I

22 understand the difficulties because this Product

23 Class 4 is such an enormously wide range of, of
273

1 products.

2 And I know you can't go out and buy a

3 hundred products and tear them all down and do that

4 thing. I know there's a limit to what you can do.

5 But, I think that I would ask that, in

6 the next run to analysis that you're going to do,

7 particularly as you go through a further

8 engineering analysis, and as you go into the MIA,

9 you know, for GRIM and so forth, we really need to

10 look at a, a better range of product than, than

11 what we've got in this Class 4.

12 You know, it's great to be looking in

13 $100 to $2000, but we're missing the, the $29 to,

14 to $100 product, and, and the impact.

15 So, I think that, -- If you could back

16 up for a second, if we can. -- I think it would be

17 important to show a range of the products at these

18 different candidate levels so that we can find

19 products out there that operate down at the ten,

20 15, $20 range, all the way upward to show that

21 there is, in fact, a -- so that you go ahead one or

22 two -- Well, either way. -- that, that the

23 relationship of that markup price is, in fact,
274

1 holds constant regardless of whether we're talking

2 about $2,000, $100, or, or $29 product.

3 I think that that's what -- To me, this

4 is what this is, is all about, is trying to get

5 that relationship so that when you, that you know

6 from the manufacturer's data, the test/teardown

7 data, and others, that your, your relationship

8 curve is, is roughly the same.

9 And, and all I'm asking is: Can we

10 increase the range of products in order to make

11 sure that this holds true at the bottom end just as

12 well as is it does at the top end?

13 So, thanks.

14 MR. NARDOTTI: Thank you.

15 Finally, DOE is interested in obtaining

16 any suggest-, suggestions on how to approach

17 scaling within a product class. Because each

18 product class includes a range of battery voltages

19 and/or battery energies, DOE must scale its

20 candidate standard levels that it's obtained for

21 each candidate unit to account for these.

22 This shows for all of the units that DOE

23 and ECOS tested in Product Class 2 for the pre-
275

1 analysis. One approach that DOE is contemplating

2 using specifically for this product class would

3 utilize the test results of universal battery

4 chargers that were tested.

5 MR. MORRIS: If I could ask you a

6 question? Wayne Morris again.

7 Back up a slide. There.

8 That's wonderful that we have all that

9 data from ECOS, but if I remember seeing ECOS'

10 data, every one of those data points represented by

11 one of those gray triangles is, in fact, in the

12 ECOS data, is identified as what the product is,

13 isn't it?

14 I mean, it's not just a lumped mass of

15 little specks. Every one of those has a different

16 individual.

17 MR. NARDOTTI: Exactly. This chart is,

18 or this graph is just to illustrate the, the

19 products that DOE tested, and distinguish those

20 from the ECOS-tested data.

21 So, yes, you're right. Each gray

22 triangle is not necessarily the same product or

23 product type.
276

1 MR. MORRIS: Thank you.

2 MR. NARDOTTI: So, as I mentioned,

3 universal battery chargers were among the, the

4 units tested in this product classes (sic), in this

5 product class, and these battery chargers typically

6 are capable of charging one, two, or four double-A

7 or triple-A batteries.

8 The graph on this slide shows how unit

9 energy consumption varied when these universal

10 battery chargers were tested at varying capacities.

11 So, DOE believes that these results could

12 potentially be aggregated and used for scaling UEC

13 with respect to battery energy.

14 This would be specific to this product

15 class, and DOE welcomes any comments.

16 MR. ALBERT: Did you also -- These

17 chargers are not capable of charging different

18 voltages, so you aren't able to assess the effect

19 of battery voltage post efficiency.

20 MR. NARDOTTI: Right.

21 MR. ALBERT: This is Larry, by the way.

22 MR. NARDOTTI: This is simply a change

23 in energy.
277

1 Forward to the comments. You can see

2 that DOE is seeking comment on suggested

3 methodologies to scale CSLs from representative

4 units to all units within each BC product class.

5 MR. BROOKMAN: Of all units within each

6 PC product class. Comments on that?

7 MR. NARDOTTI: Actually, Doug, I have a

8 bit more.

9 MR. BROOKMAN: Oh, you have a bit more.

10 The supplemental slides.

11 MR. NARDOTTI: Yes. There was the

12 supplemental slides, and were, that were handed

13 out.

14 MR. ALBERT: What does it look like?

15 MR. NARDOTTI: It was just the smaller

16 slides that was handed out.

17 MR. BROOKMAN: Okay, Toby's got it.

18 Okay.

19 It's colorful.

20 MR. NARDOTTI: So, since -- The

21 publication of the preliminary TSD DOE has

22 developed another proposed approach to scaling that

23 it would like to, to discuss today. This, this
278

1 approach is a combined approach that could be used

2 for Product Classes 2 through 6, those product

3 classes that don't have any special characteristics

4 such as inductive charges, extremely high energies,

5 DC input, or AC output.

6 This approach relies on the test results

7 of program performance, the test results of the

8 performance parameters needed to calculate UEC.

9 The end result is a separate equation for UEC as a

10 function of battery charge, or as a function of

11 battery energy for Product Classes 2 through 6.

12 So, to begin, DOE plotted its test

13 results of 24-hour energy, maintenance mode power,

14 and standby mode power, versus battery energy, and

15 calculated a linear trend line. These trend lines

16 were then combined with assumptions about usage.

17 And, again, we'll discuss those later.

18 But, they were then combined to give an equation

19 for UEC as a function of battery energy.

20 So, this graph shows all of the test

21 results of 24-hour, 24-hour energy for Product

22 Classes 2 through 6. And, as you can see, that

23 there was strong correlation between battery energy
279

1 and 24-hour energy, ranging all the way from the

2 smallest battery energy up to the largest battery

3 energy.

4 This, this slide shows maintenance mode

5 power versus battery energy for each of these

6 product classes. The correlation for this equation

7 was not as good.

8 However, if you notice, slope of this

9 equation is much smaller than the previous slope

10 for 24-hour energy, meaning that a change in

11 maintenance mode power, or a change in battery

12 energy has less of an effect on the maintenance

13 mode power.

14 You'll also notice that there are

15 clusters of, of points at the higher energies that

16 are capable of reaching low maintenance mode powers

17 at as low of maintenance mode power as the lowest

18 battery energy.

19 MR. ALBERT: The Y axis -- This is

20 Larry.

21 The Y axis is not the same in both

22 charts, right? So, if you superimpose --

23 MR. NARDOTTI: Right. So, the relative
280

1 of that cluster of dots in the bottom left corner

2 versus the cluster around 400 watt hours, versus 80

3 watt hours, you can see that there was not much

4 change in, as you increase along the X axis,

5 specifically for this parameter.

6 MR. ALBERT: So, your, your argument

7 here would be that even though the correlation's

8 weak, the overall impact is insignificant because

9 you have almost two orders of magnitude of

10 difference in the m value, in the slope value;

11 right?

12 MR. NARDOTTI: Right.

13 MR. ALBERT: Okay.

14 MR. NARDOTTI: Similarly, for the

15 standby mode power, again there was a weak

16 correlation for the trend line, but again, this

17 slope of this line is even more or is even less,

18 less dependent upon battery energy, showing less of

19 a change.

20 So, as I mentioned, DOE combined the

21 trend lines of these equations with assumptions

22 about product usage to obtain an equation for UEC

23 as a function of battery energy.
281

1 So, the, the three equations that you

2 see, E_24, P_ maintenance and P_ standby,

3 those are all functions of battery energy. Those

4 equations could then be plugged into the equation

5 that you see here for unit energy consumption where

6 those -- So, so E_ 24 would then be plugged into E_24

7 here, and then those functions could be placed

8 into, to where those parameters are.

9 And then the, the assumptions about

10 usage would then be plugged in for their, their

11 variables, and you are left with the function of

12 UEC with regards to just battery energy.

13 P_ unplugged would obviously fall out of

14 the equation because the power in unplugged mode is

15 zero, and then the power in "Off" mode is virtually

16 negligible because we have our assumption about

17 usage as minimal time in that mode.

18 So, the next two slides we present the

19 generalized equations for UEC for each of the

20 product classes, 2, 3, 4, 5, and 6. DOE requests

21 any feedback on, on this proposed approach.

22 MR. BROOKMAN: This is a new approach,

23 Matt?
282

1 MR. NARDOTTI: This is a new approach

2 that has, that was not published in the Technical

3 Support Document.

4 MR. BROOKMAN: I'm going to suggest we

5 take a break now; give you, give you time to think

6 on this, and then we'll return for the final

7 comment.

8 Before we go, Mike Rivest?

9 MR. RIVEST: Thank you.

10 Would you come back to the previous

11 slide? Just a few observations I'd like to make.

12 So, like to make -- These are product

13 classes for 2, 3, and 4. They span the same

14 battery energies.

15 They, they are slightly different

16 voltages, but the, the end lines are significantly

17 different because assumptions about operation are

18 significantly different. And what -- Right.

19 And what you'll notice, if you can come

20 back, is that the slope is greatest where the

21 number of charges is greatest. And, and also, the

22 absolute value of energy use is greater because of

23 the number of, of, of, of, of, of charges.
283

1 And the idea with these lines is that

2 you would -- The intersect is not what's important

3 here. It's the slope.

4 So, you would move that line in parallel

5 through the CSL point of your representative unit,

6 and read off that line to see what this, what the

7 Standard would be at a different battery energy.

8 MR. ALBERT: This is Larry Albert.

9 Just to clarify, do you apply, do you

10 apply the scaling factor to the quantities coming

11 from the test procedure first, or you do it after?

12 MR. RIVEST: After.

13 MR. ALBERT: Afterwards.

14 MR. RIVEST: So, to the UEC. So, if your

15 UEC at CSL, you know, if your UEC at CSL 1 is 5,

16 then you would go up to the line. And then if you

17 wanted to know what your budget was at a greater

18 energy, you would just move up, up, or up on that

19 line and read off your UEC budget.

20 MR. ALBERT: And, so, for high --

21 Larry Albert again.

22 So, for each product class, the

23 coefficient would be different, right?
284

1 MR. RIVEST: For, for, for each product

2 class the slope would be different. And for every

3 CSL, the intercept, the, the constant would be

4 different.

5 MR. BROOKMAN: Okay, let's take a break.

6 You've got these slides.

7 You can confer with them and consult

8 with them while we're on the break. Let's do it

9 just for ten minutes, and we'll now resume -- So,

10 it's now 3:14.

11 We'll resume at 3:25. I think we can

12 actually get through this by 5:00 today if we keep

13 pushing.

14 So, as Vic articulated, that's our goal.

15 See you back here in ten minutes.

16 (Whereupon, at 3:14 p.m. ET, those

17 present took a brief recess and returned at 3:25

18 p.m. ET, after which the following occurred:)

19 MR. BROOKMAN: Okay. As promised, it's

20 3:25.

21 Dan, do you want to join us up here?

22 MR. TENINTY: I just want to ask him a

23 --
285

1 MR. BROOKMAN: So, there was a lot of

2 content in that last segment. I was fairly much

3 boggled myself.

4 MR. MORRIS: You're boggled. Imagine

5 what a rest of us are.

6 MR. BROOKMAN: My -- The point is, I

7 wanted to give you a chance to think through this.

8 It may be that this content is dense enough that

9 you require time to think about it and provide more

10 detailed written comments.

11 However, I do want to provide an

12 opportunity at this juncture to make whatever

13 comments you think are especially useful at this

14 time. So, let's start with that.

15 Suzanne, do you want to start?

16 MS. PORTER: I had a clarifying

17 question, which was for the scaling relationships.

18 MR. BROOKMAN: I think -- Wait just one

19 moment.

20 I think, Matt, we need you back up here.

21 Okay. So, Suzanne.

22 MS. PORTER: Was the scaling method

23 focused on 2 through 6, and I was wondering why 7
286

1 was excluded from this proposal, the rationale for

2 that.

3 MR. BROOKMAN: And there was a duplicate

4 copy of this somewhere. Can you pass that over to

5 me? Because I didn't get one.

6 Mike Rivest.

7 MR. RIVEST: Because we didn't have

8 enough data. I mean, we're, we're still in an

9 ongoing program of tests and teardowns.

10 And the data, I mean, -- And we've been

11 incorporating the data as the test results are

12 coming in. We hope to be able to do scaling on,

13 on all the product classes.

14 MS. PORTER: Thank you.

15 MR. BROOKMAN: Dan, did you want to

16 comment?

17 MR. TENINTY: No, I had a question for,

18 for Vic.

19 MR. BROOKMAN: Yeah, Larry.

20 MR. ARNOLD: Yeah. Just a question,

21 Matt.

22 You did this analysis on the basis of

23 battery capacity. Did you consider any other
287

1 parameters, such as battery voltage or something

2 like that?

3 MR. NARDOTTI: Not as of yet.

4 MR. RIVEST: I think so. Several of the

5 product classes are already set up by voltage, so

6 the Product Classes 2, 3, and 4, are on voltage.

7 Are you suggesting that there might be a

8 need to, even within those ranges of the Product

9 Class 0 to 20 volts?

10 MR. ALBERT: To be very honest, this is

11 new, you know. I just want to think.

12 We've been thinking about these issues,

13 as I'm sure you have, all along, right? How you're

14 going to actually implement this when you get to

15 something other than ten points, right?

16 So, it's a question.

17 MR. RIVEST: Right. I think the intent

18 was to not scale on voltage because we had set up

19 the product classes with multiple voltage

20 categories.

21 MR. ALBERT: Right. Right.

22 MR. RIVEST: And just to -- I think we

23 can certainly examine the data to see if any trends
288

1 emerge that would justify it.

2 MR. ALBERT: Well, one of the questions

3 for us, in the cases where you have multiple

4 voltage charges, -- Right? -- the measurements are

5 made, if I remember correctly, at both the high and

6 low measured voltages, right?

7 And then the, then in that case, what

8 happens? Right?

9 Because now you're looking at the

10 battery that you took the measurement with as a

11 reference point to establish where you are in that

12 line. You pick off two points in the line, when

13 you've had to perhaps design the battery charger to

14 handle now what is ultimately a range of

15 capacities, right?

16 So, that's one of the -- This proposal,

17 we would have to really go back and take a really

18 close look at it and see.

19 MR. RIVEST: Right. And I think those

20 are good.

21 We just haven't gone that far. Right.

22 MR. BROOKMAN: Philips. Yes, Wayne.

23 MR. MORRIS (To Mr. Erdheim): You want
289

1 to go?

2 Wayne Morris.

3 I'm obviously trying to understand this

4 a little bit, but a couple of quick questions come

5 to mind. It looks --

6 Is it possible to back up to the slope

7 of those, those Classes 2, 3, and 4 for a minute?

8 MR. BROOKMAN: Seven. Slide 7

9 MR. MORRIS: Yeah, I guess 7 of the --

10 There you go. Yeah.

11 The, the lower termination of this seems

12 to be around five volts. Is that not really true,

13 in that you can extend this slope downward from

14 there, or is that a cutoff?

15 MR. NARDOTTI: Five watt hours, you're

16 talking about?

17 MR. MORRIS: Yeah. Because there are

18 product classes below five.

19 MR. RIVEST: Yeah. I think they fall

20 into other classes, I think.

21 MR. MORRIS: No, they actually fall into

22 Class 2.

23 MR. RIVEST: They do? Then I guess we
290

1 just didn't go all the way.

2 MR. MORRIS: Some of your one-celled and

3 two-celled products that are running 1.2 and 2.4

4 volts are going to fall down in that range. I

5 mean, they're operating at milliamps of input

6 current to your watt, our measurements.

7 Very small. So, I guess that would be

8 the question, is: Can we -- I mean, is this a

9 slope that begins and ends at a certain value, or

10 can you continue the slope on down?

11 MR. RIVEST: I think the intent was to go

12 all the way.

13 MR. MORRIS: Okay. The other question,

14 I guess, that I've got is that this, it would seem

15 to me that this makes and uses a function -- I was

16 going to say something else, but I'll try using

17 "function." -- on the, on the previous slide to

18 this one, within a product class.

19 It makes an assumption about charges per

20 day, and factors that in.

21 MR. RIVEST: Yes.

22 MR. MORRIS: Sort of quotability into

23 the function renewing of the equation. But, what
291

1 if the charges per day are widely different that,

2 than that?

3 What happens? I mean, you, you, you,

4 for instance, in Product Class 2 you've got .56

5 charges per day. But, what if my actual charges

6 per day is, like, .013, something like that?

7 I mean, --

8 MR. RIVEST: So, so the equation is to

9 give you what the Standard is, not to be used with

10 your actual usage. And so it's, I guess it's not,

11 it's not relevant how you actually use the product.

12 The, the usage assumptions there are the

13 average for all products in that category. Those

14 are the ones that --

15 MR. MORRIS: That's the problem that I

16 had, is that taking an average within an extreme

17 range may not necessarily -- I mean, even taking a

18 median, or taking a shipment-weighted average is

19 not going to be reflective of the, the, the

20 extremes of, within that range.

21 And if they could, it would

22 significantly impact some of the companies,

23 particularly -- We talked earlier today about those
292

1 that are, quote/unquote, infrequently charged.

2 That, that really hurts those.

3 MR. RIVEST: Yep.

4 MR. MORRIS: I mean, Class 2 is probably

5 overwhelmed by things like cell phones. And, you

6 know, when you put an electric shaver in with a

7 cell phone, I mean, you can shoot the weighted

8 average.

9 I mean, you -- The shaver doesn't even

10 appear on the scale. But, you know, it, it, the

11 charges per day is significantly different.

12 And same thing within Class 4. You add

13 those products which charges per day, I mean, what

14 you, what you could, in effect, encourage a company

15 to do is build a, a bigger charger in order to meet

16 the efficiency ratio.

17 So, they would, in fact, possibly use

18 more energy than they would normally.

19 MR. RIVEST: Well, the equa-, the

20 equation is sort of efficiency neutral, so that

21 incentive shouldn't be there. There might be some

22 incentive to switch product classes, and especially

23 if there's one constant.
293

1 The one next door is less stringent

2 because it's not with the cell phones; it's with

3 the what-else. But, there should be incentive to

4 slide on the EVC within the product class.

5 MR. BROOKMAN: Yes, Ric.

6 MR. ERDHEIM: Yes. And I want to just

7 concur with what Wayne just stated, that while I

8 haven't had a lot of time to, to look at this, you

9 know, the concept, you know, tentatively looks

10 favorable.

11 But, where I have an issue is when

12 I fall into product Class 2 with my beard trimmers

13 and shavers, and because cell phones are lumped

14 into that product class, now my charges per day are

15 way skewed from actual use. And, in effect, that,

16 that does have a big issue, because you guys are

17 factoring it into your slope.

18 So, currently use does affect your

19 slope, which is what you're setting your Regulation

20 on. So, either you need to --

21 MR. RIVEST: Interesting thing. So, is

22 it that it would help you because the slope being

23 steeper means you would get a break for units that
294

1 are smaller than the represented? You should plug

2 those into the equation.

3 MR. ALBERT: Okay.

4 MR. REEVES: This is Ari Reeves at DOE.

5 It also depends on what the actual

6 equation is that DOE gives you to determine what

7 your products is to compare against this allowable

8 energy consumption.

9 So, what we're talking about here is a

10 formula to determine, to determine what the CSL is,

11 what the allowable energy consumption is. So, for

12 your infrequently used product, if the, if the

13 usage profile or whatever --

14 MR. RIVEST: No, no.

15 MR. REEVES: No?

16 MR. RIVEST: No, no. Within a product

17 class there's only one profile that matters.

18 It's the one we specify. How much they

19 use their appliances, and that's, that's a problem.

20 MR. BROOKMAN: Larry, for a final

21 comment, and then we're going to move on.

22 MR. ALBERT: I just wanted to clarify

23 that the, the charges per day that are listed there
295

1 are from the average usage profile for that product

2 labs.

3 MR. RIVEST: Absolutely.

4 MR. ALBERT: They're not different for

5 establishing this line. It was just -- It showed

6 up here just because when you calculated what the

7 slope was, you had to account for that, right?

8 So, it's no different than it would be

9 for the product class usage profile that you

10 applied for everything.

11 MR. RIVEST: It's identical. It's the

12 only one that matters.

13 The Application's specific profile --

14 Right? -- is not, is not, it's not relevant to the

15 Standard because it's been taken into account with

16 the aggregation.

17 MR. BROOKMAN: With your permission

18 we're going to move on. Let's go.

19 ENERGY USE ANALYSIS

20 MR. SWOPE: Hi, everyone.

21 I'm Toby Swope, and I'm going to talk

22 about the energy use analysis. And now that

23 we straightened everything about energy use and
296

1 usage, this will be quick.

2 But, so, the purpose of the Energy Use

3 Analysis is basically to build the foundation for

4 energy calculation savings. And this is where we

5 start to talk about the costs and benefits.

6 And this is the benefits side, about

7 improving efficiencies because we would use less

8 energy. And we were trying, we're trying to fish

9 out what their unit energy savings would be.

10 But, we first need to establish what the

11 energy consumption is at each CSL. So, just a

12 couple of notes on the general approach for

13 protecting energy use.

14 The first is slightly different from

15 other rulemakings where we talk about energy

16 consumed and we talk about energy consumed for a

17 particular application, like a refrigerator or

18 dishwasher. It's what it actually uses.

19 But, in this case, with EPSs and BCs,

20 it's to provide energy. So, when we're talking

21 about "energy consumed," we're really talking about

22 energy in versus energy out.

23 The next are just some assumptions that
297

1 we made for simplification. First is the

2 estimated use of BCs or EPSs is closely tied to the

3 consumer application that they power.

4 We assumed that the energy and power

5 requirements of those applications was fixed for

6 our analysis. So, we know that laptops may be

7 getting more efficient, or printers may be getting

8 more efficient, but for our intents we don't

9 know what efficiency improvements are going

10 to be made to those.

11 So, we held them fixed. So, if a laptop

12 uses 60 watts to operate, it's going to require 60

13 watts to operate for our analysis.

14 And the other assumption that we made is

15 that there's no change in the usage of the

16 application based on the efficiency of EPS or BC.

17 So, I'm going to go quickly through EPS energy use

18 because I think that seems to be less

19 controversial.

20 (Whereupon, at 3:39 p.m. ET, Mr. Kido

21 and Mr. Petrolati conferred, out of the hearing of

22 others and off the Record, during which the

23 following occurred:)
298

1 MR. SWOPE: And, we can spend a little

2 more time on BCs, but, really, for EPSs, we just

3 really need to know how much power is required and

4 how much time is spent in, for various different

5 application states. And I'm going to discuss a

6 low-controversy product.

7 So, we're going to talk about laptop

8 computers, of course. So, from testing, these are

9 the loading points that we've identified in the

10 design application states that the laptop could be

11 in.

12 The top six are really the application

13 states, but we're including no-load mode and

14 unplugged there just for completeness.

15 (Whereupon, at 3:40 p.m. ET, Mr. Erdheim

16 left the room, after which the following occurred:)

17 MR. SWOPE: And from an NRDC report we

18 have two different types of notebook users. We

19 have those that usually have their laptop plugged

20 in.

21 That's about 40 percent of the user

22 base. And then those that usually have their

23 laptops unplugged, and that's about 60 percent.
299

1 And we can see each of the times spent

2 in each of the application states, and, again, no-load, plugged and

3 unplugged. We build a rating based on those

4 ratings of 40 an 60 percent.

5 These are the efficiency metrics we got

6 from the energy analysis. These are for a 60-watt

7 EPS.

8 They would be different for a 120-watt

9 EPS, and notebook computers fall in both those

10 categories. This slide is really to show the

11 relationship between the power consumption of the

12 EPS, and the output power that it's providing.

13 This is what we covered back in the

14 framework document. We have a relationship for all

15 the measurement points between 25 and 100 percent

16 of the loading of the nameplate output power.

17 But, we don't have it below, so we have

18 them interpolated. If you have any questions about

19 that I can provide that later.

20 But, essentially, the UEC becomes just a

21 sum of the power and the time spent. So,

22 for notebook computers, these are the results that

23 we get if we combined those loading points, the
300

1 efficiency metrics, the usage profile for the UEC

2 in kilowatt hours per year for each CSL for each of

3 those application states.

4 And the total's at the bottom. So, we

5 can see, as we improve in efficiency, we get lower

6 UEC, which is what we would expect.

7 And then that walk through that we

8 just did for notebooks, we would repeat for all the

9 applications within this particular product class.

10 So, in this case, this would be product Class A1.

11 We're showing the top applications by

12 shipments. There are more.

13 Those are contained in the usage

14 workbook. But, you can see that for notebooks we

15 did the calculation for UECs.

16 We would repeat it for video game

17 consoles, ink-jet imaging equipment, notebook

18 computers. And we would do a shipment-weighted

19 average UEC for the entire product class.

20 And I'd like to point out that the

21 individual application UICs are used in the LCC.

22 The weighted average is what we would use in the

23 NIA.
301

1 And I mentioned --

2 MR. ALBERT: Just repeat that.

3 MR. SWOPE: Sorry. So, going back, so

4 we have on each line -- So, notebook computers have

5 a particular UEC associated for them for each CSL,

6 and same applies for video games.

7 And when the LCC does its analysis --

8 And Matt will cover this in more detail. -- they

9 look at individual applications.

10 So, they would use the individual

11 application UECs. Otherwise we would use the

12 shipment-weighted average UEC.

13 Does that --

14 MR. ALBERT: But, but isn't it true that

15 for CSLs for which there weren't already

16 levels established through some other process --

17 Right? -- where you were trying to determine sort

18 of best in class or something like that, you used

19 weighted averages there as well -- Right? -- to

20 actually establish the CSL?

21 MR. SWOPE: Well, the establishment of

22 the CSL is what happens in the engineering

23 analysis. This is really just taking those outputs
302

1 and combining them with the usage profile and

2 loading points to figure out what an average

3 UEC would be for each application.

4 So, if we looked at the typical notebook

5 user, we would want to say, well, use based on a

6 particular usage profile, "How much energy does

7 that notebook consume in a year, given all those

8 inputs?"

9 And we would repeat that for every

10 application. And so the LCC though, cares about

11 what those given applications are.

12 But, in the National Impact Assessment

13 we really say, "Well, on average, what would a unit

14 within product Class A1 look like?"

15 So, that's where the weighted average

16 comes in. And hopefully when we do the LCC

17 explanation and the NIA walk-through it will make

18 more sense.

19 MR. ALBERT: Right.

20 MR. TENINTY: This is Dan Teninty from

21 Fulton again. Just a real quick clarification

22 question.

23 If you have one manufacturer that makes
303

1 the primary side of a power supply, and another

2 manufacturer that makes the secondary side that's

3 built into an end product, a cell phone or laptop,

4 so that Company ABC could make a, a transmitter, if

5 you will, or a power source, it wouldn't have any

6 efficiency because there wouldn't be anything

7 connected to it until you put an end product up

8 next to it within range.

9 And then the end product has a secondary

10 coil and rectification and power control circuit

11 that would power the circuit inductively, unlike

12 the toothbrush that is made by one manufacturer.

13 How would you classify this into CSLs or

14 product categories? Because that's the, that's the

15 fundamental question here with the WPC, is that we,

16 we are like this but we're not, because there will

17 be different manufacturers for end products and

18 transmitters, and they won't -- The

19 interoperability standard that requires that they

20 work harmoniously with each other --

21 MR. SWOPE: That's a good question.

22 It's not something that we covered in the

23 preliminary analysis, but we are, we would like
304

1 input on how we would consider that product

2 category. So, --

3 MR. TENINTY: Yeah, we need to know if

4 we are included in this Regulation or requirement

5 or not, and that's the fundamental question.

6 MR. SWOPE: I would have to defer to Vic

7 or Mike on that.

8 MR. BROOKMAN: Michael Kido.

9 MR. KIDO: I think what would be helpful

10 to the Department is when you do submit written

11 comments, go into some detail about how that works,

12 because I think we would have to take a closer look

13 at that.

14 MR. TENINTY: Would an interoperability

15 standard help you?

16 MR. KIDO: What does that mean?

17 MR. TENINTY: That's, describes the

18 technical details of how this wireless family of

19 products, whether it's laptops, cell phones, how a

20 transmitter works with a receiver, what's required

21 to be compliant with that Standard. So, all of the

22 technical questions are answered.

23 MR. KIDO: I certainly don't think
305

1 that would hurt.

2 MR. TENINTY: Okay. That's publicly

3 available, so I can make that available as part of

4 this.

5 MR. SWOPE: Okay. So, I mentioned that

6 we had tested the loading points for laptop

7 computers.

8 We tested them for some other

9 applications as well, but for applications where we

10 didn’t test loading points, we used loading

11 profiles based on those tested points. So, this

12 is just covering those.

13 And then the same applies for usage

14 profiles. For most applications we had specific

15 usage profiles.

16 For other applications, we developed

17 generic usage profiles. The top would apply to

18 applications that don't contain a BC.

19 The ones below are for applications with

20 a BC, and so we're asking for any input on the

21 usage profiles, the loading points. And this

22 carries also over to the BC profiles, which I'll

23 cover in a second.
306

1 And so for battery chargers, essentially

2 it's the same process. We really just need to know

3 the time spent in each mode.

4 So, number of charges, time spent in

5 maintenance, no battery, "off" modes. And then we

6 would combine those with the efficiency analysis

7 from the Engineering Analysis.

8 So, same walk-through from a BC

9 perspective. We have a number of charges per day,

10 time spent in active and maintenance,

11 no-battery mode, "off" mode, unplugged mode, and

12 the weighted-average use profile.

13 These are the efficiency metrics that I

14 mentioned. These are the formulas for each of

15 those, those modes in application states.

16 So, we have the charge energy,

17 maintenance energy, no-battery energy, "off"

18 mode energy. And then the total UEC would be

19 the combination.

20 This, in this example, all those

21 energies are the daily, then we're multiplying by 365

22 to see the annual. And the concern was raised

23 earlier about this time spent charging.
307

1 And just sort of going back to the

2 formulas, when we combine all these together, we

3 get the top formula. And you can check the math

4 later, but if you combine these terms, the time

5 charged actually drops out because we have it

6 subtracted in, or, yeah, subtract, subtracted, --

7 I'm sorry. -- added in before.

8 But, then we subtract it out later. So,

9 we get the simplified formula down below.

10 So, the time spent charging doesn't

11 actually factor into the analysis side for the UEC.

12 And, like I said, we can check the math, and let us

13 know how --

14 MR. ALBERT: Okay.

15 MR. SWOPE: But, the results if we

16 combined all those metrics together, we get the

17 following UEC by CSL. We repeat the process for

18 all the applications based on shipments.

19 So, this would be in Product Class 4.

20 And –we can see the differing results

21 between notebooks and power tools, notebooks,

22 hand-held vacuums, and the weighted average at the

23 bottom.
308

1 And, again, the LCC uses those

2 individual rows, and the NIA uses the bottom row.

3 MR. BROOKMAN: Yes.

4 MR. ALBERT: So, again, when you look at

5 the Sample CSL 2, -- Well, even if you look at CSL

6 0, which is probably more meaningful, -- Right? --

7 when you look at the weighted average there, 39.4,

8 it's, definitely skews more towards the notebook

9 values -- Right?

10 MR. SWOPE: Um-hum.

11 MR. ALBERT: -- because of the, the

12 large volume of users that are considered, and the

13 weighted average, right?

14 That's what you're proposing, what you'd

15 propose for CSL 0 for the entire product class,

16 though, right?

17 MR. SWOPE: Yeah. And I guess, just to

18 clarify, is the, you've raised the concern about

19 this weighted average, and --

20 MR. ALBERT: Right.

21 MR. SWOPE: For the compliance side I

22 can't speak to how we're going to approach that,

23 but from the analysis side it's less of a concern
309

1 because, really, we just want to figure out on

2 average what these units would be saving. So,

3 we're not -- In this table here I'm not speaking to

4 whether you're in compliance or not, or what the

5 formula would be.

6 I'm just saying this is what we

7 calculated for average use for when we do our

8 evaluation of whether efficiency standards would be

9 warranted.

10 MR. ALBERT: I appreciate your comment,

11 but once, obviously, once you establish one for

12 your analysis, -- Right? -- then now there's 

13 a large incentive to move forward with that number

14 as your CSL for Regulation -- Right? -- because

15 now you've justified its existence at that level,

16 right?

17 MR. SWOPE: Um-hum.

18 MR. ALBERT: And so, you know, again,

19 what it does here is it takes,

20 you know, as Wayne mentioned before, $2,000

21 laptops, you know, has those with all the attendant

22 technology, set the standards for everything else,

23 right?
310

1 MR. SWOPE: Um-hum.

2 MR. ALBERT: And so -- But what you're

3 saying is that you could have a CSL that's

4 different. Would you then have to adjust your

5 analysis afterwards?

6 MR. SWOPE: Yeah. The way we would

7 approach it in the analysis side, the

8 life-cycle cost would look at notebooks and then

9 look at power tools.

10 And Matt Hartley will cover that in more

11 detail about how it does that. The National Impact

12 Assessment looks at the whole product, and so there

13 the differences between the two are awash because,

14 really, what we care about is the weighted-average

15 user.

16 So, without knowing what the, you know,

17 without knowing where the specific users fall, we

18 know this is in aggregate what the product class

19 looks like, and so that, that would be our

20 weighted-average UEC for the product class. Now,

21 this is all based on assumptions about how we group

22 products by product class.

23 It's based on assumptions about usage.
311

1 So, if you have comments on, on those, we

2 definitely would welcome them, because obviously

3 this is part of the end result of all of those

4 assumptions.

5 MR. BROOKMAN: Wayne Morris.

6 MR. MORRIS: Wayne Morris with AHAM.

7 Toby, I agree with you in principle, and

8 certainly that's the difference between an LCC and

9 a National Impact. But, essentially what you're

10 also caring about is the difference between 39.4

11 and 10.5, or the difference between 10.5 and 6.1.

12 I mean, that's, that's a critical

13 element in this, because that is what then you role

14 up to essentially show the justification, if you

15 will, or, --

16 MR. SWOPE: Um-hum.

17 MR. MORRIS: -- or you use for figuring

18 carbon data and all the other things. And you look

19 at them, the number of power plants you avoid, and

20 on and on and on, okay?

21 The skies get bluer. So -- But, you

22 know, the, the bigger the spread that is there, the

23 more that you then justify that, the Standards
312

1 levels.

2 And it, it compounds itself. So, while

3 I totally appreciate what you're saying about don't

4 look at the individual numbers, the fact is that

5 even, even a-tenth of a point on here can roll up

6 to be, you know, millions of metric tons of carbon

7 dioxide kind of signatures, to where, you know,

8 when you, when you have these enormous spreads in

9 these, in these categories, it does matter.

10 I mean, I, I appreciate what you're

11 saying about don't look at the individual numbers,

12 but it's, it, it's important.

13 MR. SWOPE: Um-hum.

14 MR. MORRIS: And I wish there was a

15 multi-variant way. I mean, you guys use -- What's

16 the, what's the software package that you guys use

17 to --

18 MR. RIVEST: Crystal Ball.

19 MR. MORRIS: Crystal Ball? Love that

20 term.

21 -- to, to do all this.

22 I mean, you would think within Crystal

23 Ball you'd be able to do a multi-variant to do
313

1 this, rather than just the aggregate.

2 Do you?

3 MR. SWOPE: Yeah, I think when Matt goes

4 you'll see that he does.

5 MR. MORRIS: Or even the NIA.

6 MR. BROOKMAN: Or even in the -- Let's

7 let Matt address your basic point and see

8 whether that gets to it.

9 Keep going.

10 MR. SWOPE: Yeah. Yeah.

11 Yeah. So, the last slide I have is,

12 really, just looking at usage profiles for battery

13 chargers. Where we had sources, we used them, and

14 where we didn't, we used this generic-usage

15 profile.

16 And all of this is covered in depth in

17 the usage notebook as well as, you know, the TSD.

18 MR. BROOKMAN: Wayne, you're next.

19 MR. MORRIS: Excuse me. Wayne Morris.

20 Where is that usage workbook?

21 MR. SWOPE: The usage workbook, it's now

22 -- It's on the web site under the public meeting.

23 There's the technical documents, and it's one of
314

1 the workbooks.

2 MR. BROOKMAN: Mike.

3 MR. RIVEST: If you want to download it,

4 it's the, there is a tiny button at the top of the

5 web page. There's a bunch of these.

6 And the bottom of the web page just go

7 back to slide and plug that in.

8 MR. BROOKMAN: We're about to move on.

9 Questions and comments before we move?

10 (Whereupon, at 3:56 p.m. ET, no response

11 was had.)

12 MR. BROOKMAN: Okay, we're moving on.

13 Daniel Lauf.

14 PRODUCT PRICE DETERMINATION

15 MR. LAUF: So, again, my name is

16 Daniel Lauf and I'm with D&R International.

17 So, now I'm going to talk to you about

18 the product price determination, which is how DOE ultimately determines 

19 the consumer

20 price for BCs and EPSs. The inputs to the product

21 price determination are both the market assessment

22 and the engineering analysis, and the outputs are
315

1 used in the life-cycle cost analysis.

2 So, the purpose of the product price

3 determination is to estimate the prices paid by

4 consumers for BCs and EPSs. So DOE analyzes BC and

5 EPS distribution channels in order to estimate the

6 markups applied to BCs and EPSs.

7 So, here we have DOE's estimate of the model

8 for distribution. This was based both on

9 stakeholder comment and DOE's research.

10 Then DOE made the assumption that

11 the most common path to market sets the final

12 product price or the consumer price. This is

13 indicated by the central line of gray arrows.

14 And this is what Michael

15 Vladimer also presented earlier as the

16 distribution channel that DOE used to determine

17 consumer prices --

18 the engineering analysis outputs, the selling price

19 of BCs and EPSs.

20 And that, in this model here, that comes

21 just after the BC or EPS manufacturing stage.

22 Yes.

23 MR. ALBERT: Larry Albert again.
316

1 If you choose to have

2 wall adapters that are part of battery chargers

3 considered to be EPSs, then there's

4 obviously another stage that might take place

5 there, because now the OEM battery manufacturer --

6 Right? -- is now a supplier to the OEM end-product

7 manufacturer, and so therefore there's another

8 stage of the degradation, if you will, as you go

9 up, and another level and another markup -- Right?

10 -- that you may not that have factored in.

11 I think this is true if you're

12 talking about a true EPS that's marketed that's

13 sold within product, okay? And even in the case of

14 perhaps the wall adapters might be a part of

15 an integral product.

16 But, if, for example, you have a wall

17 adapter that is permanently wired into a charger

18 base -- All right? -- that becomes a charger.

19 That then becomes sold to the next level

20 up, that, let's say, a power tool with a battery pack.

21 And now the charger right -- There's a whole

22 'nother level that's not even represented there,

23 right?
317

1 MR. LAUF: Um-hum.

2 MR. ALBERT: Right? But, it's

3 contingent upon the fact whether or not

4 the wall adapters are considered to be EPSs in the

5 definition, again.

6 MR. LAUF: And you're

7 right, that's something that's not explicitly taken

8 into account, again because of the assumption that

9 it's the most simplified, common path to market

10 that sets prices. But, it's something that DOE

11 will consider looking at down the

12 line.

13 MR. BROOKMAN: So, your comments that

14 would reflect those differentiating points, that

15 would be helpful to the Department.

16 MR. PETROLATI: Right. Right.

17 MR. LAUF: Right. And any comments with

18 regards to this distribution model that we have

19 that would help us refine it and make it, or would

20 help DOE refine it and make it more accurate would

21 be helpful.

22 MR. BROOKMAN: And just to be more

23 specific, any of these key supplements that you
318

1 could elaborate on how you would understand you

2 would diverse from them, that's especially helpful.

3 Go ahead.

4 MR. LAUF: Sure. And where I left off

5 was where the engineering analysis output is,

6 EPSs. And DOE, with the product price

7 determination, resumed the markup, resumed the

8 pricing analysis at that step, and assigned markups

9 at the OEM and at the, at the end-use product

10 retailer levels.

11 So, as, as soon as BCs or EPSs are

12 integrated into an end-user consumer product, the

13 price of the BC or EPS is effectively hidden or

14 buried under the price of the consumer product.

15 To estimate the markups applied to that

16 BC or EPS, DOE assumed that any markup tied to an

17 end-use consumer product would be applied equally

18 to all of that product's

19 individual components.

20 So, if the power tool is marked up, say, 50

21 percent, the power charger for that tool would be

22 marked up 50 percent. Now, end-use product price

23 markups also are not readily apparent, because
319

1 they're typically highly confidential.

2 So, DOE assumed that any markup that

3 could be derived via publicly available gross

4 margin information, or revenue and cost information

5 that it gathered from SEC 10(k) filings, DOE

6 assumed that those markups could then be

7 applied equally across all of the company's product

8 offerings.

9 And, once again, all the markups

10 that I'll be discussing in this analysis were,

11 again, derived from publicly available information.

12 DOE looked at approximately 80, I believe it was 83

13 retailers and OEMs, the largest players

14 in these industries, to determine these markups.

15 So, markups relate the final product

16 price to the price that the OEM pays for the BC or

17 EPS. For products more efficient than the

18 Baseline, or CSL 0, DOE estimated two markups.

19 The first is known as the baseline

20 markup, and this relates price to cost prior to any

21 change in efficiency. Baseline markups cover all

22 of an OEM or retailer's expenses, including that

23 OEM or retailer's profits.
320

1 Now, incremental markups relate product

2 price to cost for the incremental cost increase

3 that results from an increase in efficiency. To

4 calculate increment markups, DOE assumes that as

5 the MSP increases due to efficiency, some costs

6 remain fixed, such as direct labor and overhead,

7 while others vary with that increase in efficiency.

8 So, incremental markups allow OEMs and

9 retailers to cover these variable costs and

10 maintain profit margins. And this graph behind me

11 gives an example of how that would work.

12 So, this is a hypothetical product with

13 a $10 baseline MSP, which you can see on the left.

14 And there's a hypothetical 50-percent baseline

15 markup applied to it, which would step that $10

16 price up to, or $10 MSP up to a $15 retail price.

17 Now, should the product be made more

18 efficient, let's say the MSP increases by $2, that

19 would be the incremental cost. That initial $10

20 baseline cost would still have that 50-percent

21 mark-up applied to it, so that would still be $15.

22 However, the $2 incremental cost that

23 you see, again, not all of that OEM or retailer's
321

1 cost would have scaled with the increase in the

2 MSP, so it only has a hypothetical

3 15-percent increment markup applied to it.

4 MR. BROOKMAN: Larry. Larry, please.

5 MR. ALBERT: Yeah. So, the -- I would

6 expect it to be $3, right?

7 That would be the same markup that went

8 from MSP to -- Because some of those arguments that

9 you make are maybe appropriate in a manufacturing

10 environment, but I don't know if they're

11 necessarily true in the commercial setting --

12 Right? -- where these are really based

13 upon margins and things like that are independent of where the markup came 

14 from,

15 right?

16 I mean, to go from the, the markup,

17 perhaps in going from bottom cost to the MSP, you

18 know, maybe that's legitimate, to

19 some extent.

20 But, with respect to the MSP to the

21 retail, what do these fixed-costs columns mean?

22 Are they -- Go ahead.

23 MR. LAUF: Where do the
322

1 fixed-costs --

2 MR. ALBERT: Your argument is it's not a

3 percent, right? The markup on the increment is not

4 the same as the markup on the base cost, right?

5 MR. LAUF: Yes, because when

6 the incremental cost increase, when the MSP

7 increases from standards, --

8 MR. ALBERT: Right.

9 MR. LAUF: -- the retailer would, of

10 course, have that increased MSP, which would get

11 passed along to the consumer. But, the idea is

12 that not all of the overhead or direct labor,

13 indirect labor expenses would increase,

14 necessarily, because the cost of the product

15 increased due to efficiency.

16 So, the same markup wouldn't necessarily

17 need to be applied, because not all of those costs

18 scaled with the increase.

19 MR. ALBERT: Just to clarify, MSP is the

20 -- ?

21 MR. LAUF: It's the manufacturer's

22 selling price. It's the price of the unit coming

23 out of an EPS manufacturer, or it's what they would pay for it.
323

1 MR. ALBERT: Okay. So, no more

2 manufacturing costs after that; correct?

3 MR. LAUF: I'm sorry?

4 MR. ALBERT: No more manufacturing

5 occurs after that point; correct?

6 MR. LAUF: To the BC, or the EPS.

7 MR. ALBERT: Right.

8 MR. LAUF: It's then integrated to an

9 end-used product by the OEMs and sold by --

10 MR. ALBERT: Okay, what's in between

11 there? There was a manufacturer.

12 What's the OEM efficient product's

13 manufacturer's output?

14 MR. LAUF: Right. They manufacture the

15 consumer's application, so that would be the power

16 tool, the laptop computer, the mobile phone.

17 And the assumption is that it comes

18 prior to them, the manufacturer of the actual BC or

19 EPS.

20 MR. ALBERT: I guess I'm not seeing

21 where the fixed costs come in and, and dilute this.

22 You're saying fixed costs essentially remain the

23 same and dilute the markup -- Right? -- such that
324

1 instead of having 50-percent markup which you would

2 presume based on your baseline product cost, it

3 should only be 15. Right?

4 MR. LAUF: Right. Again, this is

5 hypothetical, but it's somewhat --

6 MR. BROOKMAN: Let's -- Quick

7 commentary.

8 MR. REEVES: Ari Reeves, DOE.

9 Larry, I just want to interject. We

10 could spend a long, long time discussing this, and

11 this is consistent with other DOE rulemakings.

12 I just want to point out that there was

13 a Notice proposed on refrigerators that goes into

14 quite some detail that shows why DOE -- So, in the

15 interest of time, --

16 MR. ALBERT: I apologize. I'm obviously

17 not an appliance person.

18 MR. BROOKMAN: Do you want to let Wayne

19 go, and then I'm, I, I'll come back to you?

20 MR. MORRIS: Wayne Morris for AHAM.

21 I understand that, Ari, but we're

22 dealing with a component, not a refrigerator. And

23 it really is critical that we get it right.
325

1 And I also think that we're -- In the

2 case of an EPS I might agree with you that there's

3 no manufacturing, quote/unquote, that occurs

4 afterward, but not with a battery charger because a

5 battery charger's got to be integrated with the

6 product.

7 There's got to be some way to actually

8 wire that thing in. If you're seeing an

9 external power supply as a part of a battery

10 charging system, there very much is manufacturing

11 that has to go on, and that has to be accounted

12 for.

13 MR. LAUF: So, just to make sure that I

14 understand what you're saying, are you saying this

15 approach might be appropriate for EPSs --

16 MR. MORRIS: Right. Might be.

17 MR. LAUF: -- through the distribution

18 chain, but not necessarily for the OEM --

19 MR. BROOKMAN: And to finish up, the

20 manufacturers in the room do not get the meaning of

21 the full mark-up.

22 Rick?

23 MR. HABBEN: Again, I come from the
326

1 retail, not the sales side, but I get the idea of

2 it. But, if the terms are correct, you're talking

3 the manufacturer sales price.

4 That would be our selling it to our

5 customer, correct?

6 MR. MORRIS: No, no.

7 Go ahead.

8 MR. LAUF: No, that's MSP.

9 That -- Michael Vladimer discussed earlier, that's

10 the power supply manufacturer selling its --

11 MR. BROOKMAN: It's the finished product

12 as sold to --

13 MR. LAUF: Right. The product in

14 question is the battery charger or power supply.

15 And then it's integrated or bundled

16 into another consumer product.

17 MR. ALBERT: Okay no further comment.

18 MR. BROOKMAN: We're going to keep

19 moving along. You've been given plenty to consider

20 here.

21 MR. LAUF: And so on this slide we just

22 have the average results that were found

23 for markups. As you can see, DOE calculated
327

1 baseline incremental markups at the OEM stage, at

2 the retailer stage, and population-weighted sales

3 tax was then determined; and the product of those

4 three yields the composite markup.

5 So, the typical composite, baseline

6 markup, was 2.33, while the composite incremental

7 markup was 1.43. And those are multipliers.

8 So, 1.43 would be equivalent to

9 43-percent markup. And those were the

10 numbers that were then used in the LCC analysis.

11 And DOE does seek comment on the

12 assumptions and methods that were used in this

13 analysis, both in terms of the analysis in general,

14 but also as they relate specifically to battery

15 chargers and external power supplies.

16 MR. BROOKMAN: Comments?

17 (Whereupon, at 4:11 p.m. ET, no response

18 was had.)

19 MR. LAUF: Thank you.

20 MR. BROOKMAN: Thank you. Move on.

21 We've already had a break, so we're

22 going to just keep plugging along until it gets

23 considerably late. So, just so you know.
328

1 So, if you need a comfort stop you can

2 just excuse yourself and we'll just keep going

3 here.

4 LIFE-CYCLE COST AND PAYBACK PERIOD ANALYSES

5 MR. HARTLEY: My name is Matt Hartley with

6 Navigant Consulting. I'll be talking about the

7 life-cycle cost and payback period analysis, and

8 I'll try and do it quickly.

9 So, the purpose of life-cycle cost and

10 payback is to assess the impacts on consumers due to

11 energy conservation standards. It's conducted

12 from the consumer's perspective and shows the cost

13 of owning and operating the product over its

14 lifetime.

15 As indicated in this diagram, it considers two components: 

16 “First cost,” which

17 is purchase price and installation; and then

18 “operating costs” discounted to a present value.

19 This allows DOE to calculate the total

20 life-cycle cost for each standard level considered.

21 Results are then expressed as LCC savings, or the

22 baseline LCC minus the standard level LCC, and a

23 payback period is also calculated and reported.
329

1 So, I'll now discuss a couple of key

2 inputs and the methodology DOE took to derive these.

3 So, as we just mentioned, the LCC has total

4 installed price and total operating cost, and that’s discounted to a 

5 present value.

6 The total installed price is made up of a

7 purchase price, which includes the product price,

8 with baseline and incremental markups like Dan just

9 mentioned, and also installation cost, which 

10 DOE assumes is zero for these products.

11 Then we look at the operating costs,

12 which are made up of the unit energy consumption

13 that Toby discussed, the energy cost, and then also

14 any maintenance and repair costs, which DOE also

15 assumed are zero for these products.

16 Then we have to look at present value

17 factors to discount any future cash flows to present

18 value. So, we use a discount rate to calculate the

19 present value of any of these cash flows over the

20 lifetime of the product.

21 The discount rate is calculated

22 separately for the residential and commercial

23 sector, and the lifetime we use is specific to the
330

1 application being analyzed in the LCC. And I'll go into

2 the applications in just a few slides.

3 So, looking at energy prices and trends,

4 to calculate operating costs we have to multiply

5 the unit energy consumption by energy prices. 

6 DOE calculates average electricity prices for 13

7 different geographical areas by examining electric

8 utility data.

9 This data is available from the Energy Information

10 Administration Form -861, and that allows DOE to

11 calculate the current electricity price for both the residential and

12 commercial sectors. So, DOE then uses this current

13 electricity price to project any future electricity

14 prices, which uses the Annual Energy Outlook, published

15 annually.

16 DOE applies the trend seen in the AEO to

17 the current electricity price to project any future

18 electricity prices. I'm now going to talk about

19 discount rates.

20 So, once all the cash flows are

21 determined, DOE uses a discount rate to calculate

22 the present value of expenses over the product's

23 lifetime. Discount rates are based on the
331

1 interest, or “finance cost,” to purchase and operate

2 products.

3 This finance cost can either be the cost

4 of debt, or the opportunity cost of equity used to

5 purchase and operate battery chargers and external

6 power supplies. In the commercial sector, the

7 discount rate is calculated as a weighted-average

8 cost of capital for a commercial entity.

9 And you can see here the discount rates.

10 The average is the one shown here, although in the

11 life-cycle cost analysis, DOE samples from a

12 distribution of discount rates, with this being the

13 average.

14 Okay. Efficiency distributions in the

15 base case.

16 So, we, we talked before about the

17 base-case market distribution. When calculating

18 LCC savings, DOE will consider the difference in

19 total LCC between the baseline and the potential

20 standard level.

21 But, as we saw for battery chargers and

22 external power supplies, many consumers already

23 purchase products that are more efficient than the
332

1 baseline efficiency.

2 So, DOE characterizes the status quo

3 distribution efficiencies as the base case market

4 distribution. The table here presents the base

5 case market distribution that was used for

6 EPSs.

7 So, in conducting the analysis, DOE

8 considered this base case market distribution

9 to determine the impact of standards on a consumer.

10 Using the example here, you can see at CSL 3,

11 best in market, 3.3 percent of customers

12 already purchase products that are that efficient.

13 So, that means that 3.3 percent of the

14 market would be unaffected by a standard set at

15 CSL 3, because they already purchase these

16 products.

17 Similarly, when we calculate LCC savings

18 at CSL 4, we compared a difference in life-cycle

19 costs between CSL 3 and CSL 4 for those 3.3 percent

20 of customers, not looking at the difference between

21 CSL 4 and the baseline.

22 Okay, application sampling. So, as

23 we've seen, each representative unit and product
333

1 class has multiple different applications that fall

2 within it, and each of these applications have

3 unique input values, like lifetimes, markups, and

4 usage profiles.

5 So, the LCC considers two

6 different types of analyses, and first of all

7 I'll talk about the Monte Carlo analysis, which uses 

8 the Crystal Ball software that was

9 mentioned earlier.

10 So, to account for differentiation among

11 the different applications, DOE samples a distinct

12 application during each trial in Monte Carlo analysis.

13 I'll go over an example once I'm finished with this

14 slide, but for now we'll just talk in, kind of in

15 theory.

16 So, all the applications are given a

17 shipment-weighted probability. An application is

18 then sampled based on that probability.

19 When an application is sampled, the LCC and

20 payback period are calculated with the inputs that are

21 specific to that application. On the other hand, the

22 sample calculation uses a shipment-weighted average value for each

23 input from the selection of applications, rather than the

24 application-specific, to do the calculations.
334

1 So, we’re going to look at an example.

2 Here we have battery charger product class 6,

3 which is medium-energy, high-voltage. We have five

4 different applications that we see here. So, in

5 the life-, in the Monte Carlo analysis you can see

6 -- I don't know if you guys can see the laser

7 pointer. -- here there's a "Probability" column

8 right here.

9 So, what we're saying is, that electric

10 scooters, based on the number of shipments that

11 they have, have a 27-percent chance of being

12 sampled when the Monte Carlo simulation is run.

13 This entire row of inputs would be used to do the

14 LCC and payback calculations.

15 So, the UEC would be 66 for CSL 0, 39

16 for CSL 1, and so on. Now, that's just one trial,

17 and the Monte Carlo analysis looks at 1,000

18 different trials.

19 So, over here's how it will sample each

20 one of these applications in proportion, based on

21 its probability. And the end result is that it

22 will average out to about what we have here for

23 weighted totals.
335

1 Now, I mentioned the sample calculation,

2 and when we do that calculation we'll pull it

3 directly from this bottom line of weighted totals,

4 which are shipment-weighted totals for each of

5 these inputs.

6 (Whereupon, at 4:18 p.m. ET, Mr. Kido

7 and Mr. Petrolati conferred, out of the hearing of

8 others and off the Record, during which the

9 following occurred:)

10 MR. BROOKMAN: When you get to the right

11 spot you get to try to answer the questions that

12 were raised earlier.

13 MR. HARTLEY: I'm hoping that as I talk

14 I'll answer them, but --

15 MR. BROOKMAN: I thought you were

16 getting at them just right there, but just to the

17 extent you can.

18 MR. HARTLEY: And please stop me if your

19 question doesn't get answered.

20 MR. ALBERT: Do you mind just rolling

21 back one slide? In the measurements of the

22 weighted totals, what are they used for?

23 MR. HARTLEY: The weighted total is used
336

1 in what we call a sample calculation. Now, the

2 results that you will see presented in the chapter

3 all use Monte Carlo simulation, so it's not

4 using this weighted total.

5 It's using an average of 1,000 trials

6 for each of those, not a sample

7 calculation.

8 The sample calculation is kind of a

9 quick and dirty way to look at the net impact for

10 that product class or represented unit. The reason -- And

11 I'll touch on this in the next few slides, but the

12 reason that the Monte Carlo analysis is so useful

13 to DOE is that it shows a distribution of impacts.

14 So, you can see that even if the, the

15 average impact is, say, a savings of 13 cents, some

16 consumers will save more and some will save less.

17 And we get that kind of insight from Monte Carlo,

18 whereas with the weighted total we would just have

19 the 13 cents.

20 MR. ALBERT: But, but that's only within

21 the product class, right? So, you don't get that

22 application by application, right?

23 In other words, you're not --
337

1 MR. HARTLEY: Correct. The weighted

2 total would only be across the class, because the

3 application, we would be using the

4 application-specific data.

5 Is that what the question was?

6 MR. ALBERT: Yes. What I'm saying is

7 that distribution of variation and, and benefit,

8 cost benefit -- Right? -- occurs as a result of

9 your sampling routine across the different

10 applications, not across different users made

11 within the same application, right?

12 So, some users will derive benefit; some

13 will not. Right?

14 MR. HARTLEY: Exactly there's a slide,

15 the -- Actually, the very next slide, we're going

16 to talk about some of the variables that do, some

17 of the inputs that do vary with the Monte Carlo.

18 MR. ALBERT: Right.

19 MR. HARTLEY: And it's not all tied into

20 the application. So, let me do this next slide,

21 and let me know if the question is unanswered.

22 Or, are there any more questions on this

23 slide?
338

1 MR. BROOKMAN: Keep going.

2 MR. HARTLEY: So, the distribution of

3 results for the Monte Carlo simulations illustrate

4 the varying impacts that a population of users will

5 experience. So, for each representative unit or product class,

6 DOE examined 1,000 sampling trials, and each trial

7 represents a different consumer with specific

8 inputs.

9 Inputs were varied based on four

10 different factors here. One is the application

11 selection, which determines the lifetime, the

12 markups, and unit energy consumption.

13 And that's the slide we just looked at.

14 One of the other inputs that varies is the starting

15 CSL.

16 And this is the base case market distribution, 

17 where some of the purchasers are already purchasing

18 products at an efficiency level above baseline.

19 Next is geographic region, which determines what

20 electricity price and sales tax rate we use,

21 which is specific to that geographic region.

22 Lastly, the discount rate is selected

23 from a distribution of discount rates where we have
339

1 an average, but within a given trial it would

2 select a number within that distribution.

3 Does that answer your question?

4 MR. ALBERT: Well, not really, because

5 when you say you select the, the trial at 1,000

6 trials, you say it represents a different consumer,

7 is it a recognition that not all consumers use the

8 product in that application the same way? Right?

9 So, --

10 MR. HARTLEY: So, currently -- No.

11 Currently what we look at is -- And I'll go back to

12 this slide.

13 When we select electric scooters --

14 MR. ALBERT: Right.

15 MR. HARTLEY: -- we're looking at these

16 discrete inputs for the application-specific

17 data. One thing we did look at as a sensitivity

18 analysis is what we call a low sensitivity and high

19 sensitivity, where we assumed certain different,

20 different high- or low-usage profiles and other

21 inputs.

22 MR. ALBERT: Okay, so you --

23 MR. HARTLEY: But, within the reference
340

1 case we did not look at distributions. And

2 the logic behind that is that there was in

3 many product classes so many different applications

4 that we're already accounting for somewhat of a

5 distribution of input values by sampling these

6 different applications.

7 MR. ALBERT: Okay. So, so that

8 information is available.

9 But, that's done, that's not done within

10 the product class. That's done for individual

11 applications, right?

12 High or low savers are within a product

13 class?

14 MR. HARTLEY: That's done on the product

15 class, not, --

16 MR. ALBERT: All right.

17 MR. HARTLEY: -- not on an individual, --

18 MR. ALBERT: All right. Thank you.

19 MR. HARTLEY: -- although I'll take this

20 opportunity to say that one of the things that DOE

21 plans to look at are the application-specific results.

22 Likely that would be done using the

23 sample calculations, since there are so many
341

1 applications. I mean, there's, there's 80 or more.

2 But, that would give us an indication of

3 application-specific results, potentially, for

4 different user profiles.

5 MR. ALBERT: Okay.

6 MR. BROOKMAN: Let’s let him keep going.

7 MR. HARTLEY: So we've covered this.

8 Okay.

9 I want to show this chart as an example,

10 where we look at life-cycle cost savings. And this

11 is looking at the 2.5 watt EPS if DOE were to set the

12 standard level at CSL 3.

13 And this kind of helps illustrate the

14 distribution of impacts that you see from a certain

15 standard level. The technical support document presents similar results 

16 as 

17 the box and whisker plot which is shown at the

18 bottom horizontally in this chart.

19 In this chart, the

20 X axis represents the LCC savings, and the Y axis represents the

21 portion of consumers with those impacts.

22 Here the red shaded area, or it may look tan

23 here, are consumers who experience negative
342

1 life-cycle cost impacts from a standard set at CSL 3. The

2 blue is where consumers have a positive LCC impact.

3 So, I show this because I want to show

4 that there's a distribution of results. And these

5 are based on some of the varying inputs we just

6 discussed.

7 Also, -- When you see

8 these box and whisker plots in the write-up, you can

9 know that this bottom whisker represents the fifth

10 percentile, versus the 

11 twenty-fifth and the fiftieth and the

12 ninety-fifth. And the bottom of the box means that, for example,

13 this is the twenty-fifth percentile.

14 That means that at CSL 3, we expect that 25 percent of 

15 consumers experience LCC savings of negative eight cents or less. So, 

16 they're losing eight cents or worse. And that just kind of helps to give an

17 indication of results here. 

18 So, consumers whose

19 savings equal their added costs will have an

20 LCC savings of $0. Additionally, consumers who already

21 purchase a product at a given standard level or
343

1 higher will have an LCC savings of $0 because

2 they'll face no impact for a standard set at that level.

3 And then lastly I just want to point out

4 here where we have the mean, 13 cents. So, when we did the sample 

5 calculation,

6 we get this.

7 But when we do the Monte Carlo, we can

8 see that the answer is still 13 cents, but it

9 allows DOE to see what proportion of consumers

10 would benefit, versus what proportion would perhaps

11 lose money on this. This chart is, is just to put

12 that box and whisker plot in context. So, the shaded one 

13 right here is what we were just looking at. And a

14 chart like this is available in the chapter, which 

15 shows the distribution of results for every CSL for every

16 product class.

17 One last thing I want to note for this

18 diagram here is that for CSL 1 you can see that

19 there's no blue box in the bottom, and there's

20 nothing below zero. That means that no consumers

21 would have negative impacts by a standard set at CSL 1.

22 Similarly, we can see that the red bar
344

1 here is at zero, meaning that the median

2 is at zero LCC savings. And the reason for this is

3 if we think back to the base case market distribution,

4 only 34 percent of the consumers currently purchase

5 below CSL 1.

6 The remaining 66 percent are purchasing

7 at this level or higher, and therefore would have no

8 impact. So, you already have over half the market

9 that would have no impact, which is why we have

10 a median value of zero.

11 This is also just in here as an example

12 to walk through the way that we present LCC results

13 in Chapter 8. So, here again we're looking at the

14 2.5watt EPS representative unit.

15 The section here on the left is kind of

16 descriptive items. It shows each CSL, the efficiency,

17 and the no-load power, which we derived from the

18 engineering analysis.

19 Next we're looking at life-cycle cost.

20 So, the "Average Installed Price" is essentially

21 the price that the consumer would have to purchase

22 the product for.

23 "Operating Cost" is the total operating
345

1 costs over the product's lifetime, and the average

2 LCC would be the sum of those two. When we look at

3 the weighted-average savings, this is the net

4 effect of moving from one CSL to a higher CSL for

5 the consumer.

6 And it's important to note that for this

7 weighted-average LCC savings, it's not equal to the

8 difference between the average life-cycle cost of

9 the two CSLs, and that's because DOE accounts for

10 the percentage of impacted consumers using the

11 base case market distribution.

12 So, it's not as simple as, as

13 subtracting these two numbers, because you have to

14 weight by how many consumers are at each of those

15 CSLs. Then here we look at the consumers with no

16 impact or net benefit, and that's the red of the

17 table, versus the blue -- And finally is a

18 median payback period.

19 So, lastly I just wanted to discuss

20 these two sensitivities that DOE performed. So,

21 these are where DOE would simultaneously

22 vary several key inputs to the life-cycle cost

23 savings calculation.
346

1 We call these the high savings and low

2 savings sensitivities, and the results for these

3 sensitivities can be found in Appendix 8B of the

4 TSD. For these sensitivities, DOE simultaneously

5 adjusted the inputs listed in this table below.

6 Each input was adjusted to a reasonable

7 value based on alternative source data, different

8 assumptions, or different confidence intervals. So, when

9 we were discussing before the differences of

10 light versus heavy users, we would use an alternate

11 usage profile to create these.

12 So, since each representative unit had so many

13 possible inputs due to the applications, DOE wanted to

14 see how LCC results might change if alternate inputs were

15 used. So, DOE varied these inputs simultaneously, but

16 only varied each individual input to an extent that

17 was reasonable.

18 So, with that I'd just like to ask for

19 any comments here on the sensitivity analysis and the

20 methodology, or any other aspect of the life-cycle

21 cost and payback period analysis.

22 MR. BROOKMAN: Lot of contents there.

23 Any comments before we proceed?
347

1 (Whereupon, at 4:30 p.m. ET, no response

2 was had.)

3 MR. BROOKMAN: Okay, I think we're going

4 to keep pressing on then.

5 SHIPMENTS AND NATIONAL IMPACT ANALYSES

6 MR. SWOPE: Hi, again. Toby here.

7 And we're going to skip the break and

8 move on the, on the Shipments Analysis. And,

9 really, the Shipments Analysis is an input to the

10 NIA.

11 And just as Matt described, the LCC

12 looks at groups. It's looking at individual user

13 level.

14 The NIA just really needs to look at the

15 aggregate impact of what Standards who have over

16 all the shipments of products over a 30-year

17 lifespan. So, we're just talking about how many

18 BCs or EPSs would be affected, how the Standards

19 would affect the number of units, and also how

20 Standards would affect the efficiencies of those.

21 And so we're talking about the aggregate

22 total. And for efficiencies we're talking about

23 the weighted average; so, the two outputs of the
348

1 shipments analysis.

2 It's the number in the shipments forecast, and

3 then the efficiency with the efficiency forecast.

4 So, the general assumptions around the shipments

5 analysis, we tried to account for all the major

6 known market trends.

7 As Dan talked about earlier today, we

8 know that there are going to be some factors that

9 affect shipments of EPSs for cell phones, so we

10 look at those types of trends.

11 In terms of projecting the number of

12 shipments out for 30 years, this is pretty

13 difficult because the mix of applications will

14 admittedly change over time. Products that use BCs

15 or EPSs today didn't exist 30 years ago, and we're

16 going out 30 years from 2013.

17 So, so, as far as the growth rate and

18 mix of applications, we hold the growth steady so

19 that the per-capita use of EPSs and BCs remains

20 what it is today. So, we're holding it at the .75

21 annual growth rate, which is the population growth

22 rate.

23 And then as far as those mix of
349

1 applications, a simplifying assumption that we just

2 have to make is that the mix today will be the mix

3 over 30 years. And, again, some products will come

4 along.

5 New products will come in, and some

6 products may be phased out. But, we just don't

7 know what those products are yet.

8 So, -- And then the last assumption is

9 that there's really no difference in shipments

10 between the base case and the Standards case.

11 People will continue to use the applications that

12 use the EPSs or BCs, without regard to the change

13 in efficiency of the EPS or BC.

14 And then for the efficiency forecast, we

15 do similar. We look in the short-term, what

16 efficiency improvements might occur through 2013.

17 When the Standard hits, we use a roll-up

18 marketing response. And I'll cover this a little

19 bit in the next slide, but just that only the units

20 that don't meet the Standard will be changed to meet

21 the Standard.

22 Units above are not affected, and we

23 don't foresee any changes in efficiency after 2013.
350

1 So, just to -- So, what's going on in terms of that

2 efficiency forecast, -- This is for Class A EPSs.

3 We talked about it changing through

4 2013, and so we start with our current market

5 distribution of efficiencies. We know that there's

6 European Standard coming out that would affect most

7 class A EPSs, and that class would be at ENERGY

8 STAR.

9 So, our assumption is that half of the

10 units between now and 2013 would be moved up just

11 as a side product of that new standard in

12 Europe. So, 34 percent of the, of the shipments

13 are moving from CSL 0 to CSL 1, and then we have

14 our four standard cases below.

15 So, in that first row, or the third row,

16 the standard case in CSL 1 since the Standard is

17 now there, we would take all that distribution at

18 CSL 0 and roll it up to CSL 1. So, we have 34.

19 And fifty-one gives us 85. And same would

20 repeat for all the other Standards.

21 So, what we're seeking for comment is

22 just on those assumptions that I outlined. The

23 first is that there would be no change in shipments
351

1 of EPSs or BCs due to the Standard.

2 One I didn't mention specifically, but

3 just substitution effect, we assume there's none for

4 EPSs or BCs. And then a, what I just covered in

5 the base case, that efficiency forecast, those

6 assumptions there.

7 So, if there's no questions, I'll move

8 on to the National Impact Assessment.

9 MR. BROOKMAN: Let's just pause.

10 (Whereupon, at 4:35 p.m. ET, no response

11 was had.)

12 MR. BROOKMAN: Nothing at this point?

13 Okay, nothing additional.

14 MR. SWOPE: Okay. All right.

15 So, as I mentioned, the National Impact

16 Assessment functions similar to the LCC. That's

17 just estimating, how many

18 savings would the U.S. enjoy?

19 That's the national energy savings. And then

20 the net present value is the net possible effects

21 on all consumers.

22 So, what would the consumers experience

23 in aggregate in terms of the value of those
352

1 savings? So, essentially the process is this, is

2 simple in concept.

3 We just need to know how much on average

4 for each product class a unit cost would be, and

5 how much the energy savings would be. And then we

6 just need to know how many units would be affected.

7 So, so the shipments there, the

8 shipments analysis is those 30 years' of shipments.

9 We continue our analysis out ten years.

10 The ten years is just based on the

11 maximum lifetime for products that use EPSs or BCs.

12 If they lasted longer, we would continue until

13 those 30 years' of shipments had all been retired.

14 And we look at the increments in costs.

15 The energy savings from that would accumulate from

16 those Standards.

17 And just visually, this is, this is sort

18 of what's going on, is you start with the shipments

19 in the left. The yellow bars on bottom represent

20 the costs, the increased costs due to those

21 shipments, due to efficiencies being increased.

22 But, then the green bars are the savings

23 that those units produce. And these are in the
353

1 2009 dollars, so that accounts for the decrease.

2 It's just we're discounting back to the

3 present date. And the net present value is the

4 difference between the two, so that blue line.

5 And in this case we can see that's

6 positive, and this would be for Product Class A-1

7 with the CSL 1. These are the inputs for the NIA.

8 I won't talk about them. Well,

9 actually, the only one I will cover is the discount

10 rate.

11 We don't use the same process as the

12 LCC. Here we're instructed by OMB to use two

13 discount rates, three percent and seven percent.

14 And just like the with the LCC, we

15 evaluate low savings, reference, and high savings

16 cases. And the variables in those cases for the

17 NIA are the manufacturer's selling price, the UEC,

18 and the lifetime.

19 And I think we can, we're going to skip

20 over the results, because the results of the NIA

21 are preliminary, so they'll change, necessarily, as

22 we change the inputs. And so then we can just move

23 on to the next set of analyses.
354

1 So, I'm just going to skip through

2 those.

3 MR. BROOKMAN: We'll just pause there if

4 there are questions and comments on that series of

5 slides.

6 MR. ALBERT: Yes.

7 MR. BROOKMAN: Yes, Larry.

8 MR. ALBERT: Just -- Larry Albert.

9 Just a couple of general -- The

10 Department's selection of using the CSL is based on

11 the market analysis or the LCC for that particular

12 category and CSL?

13 MR. PETROLATI: Larry, the simple answer

14 is the Department takes into account all of the

15 information, and it will depend on the particular

16 decision-maker as to how all that information's

17 weighted. So, I think it would be impossible for

18 me to give you an answer that would be typical for

19 every decision.

20 Does that make sense?

21 MR. ALBERT: I hear what you're saying,

22 but --

23 MR. PETROLATI: Yeah.
355

1 MR. ALBERT: -- there must be some

2 criteria where you're not -- If you get a negative

3 LCC, would you consider it if the National Impact

4 Analysis was --

5 MR. PETROLATI: Let's put it this way:

6 We see some negative LCCs under certain levels for

7 certain product classes, all right?

8 Would the decision-maker take that into

9 account if the total of all of the savings from the

10 Standard was still positive? Would they accept the

11 fact that certain product classes had negative LCCs

12 associated with it?

13 My understanding is, yes, those

14 decisions can be made by that decision-maker, all

15 right? Which, in the past, may not have been the

16 way that traditionally the program was looked at.

17 But, anyway, I haven't been on the, in

18 every meeting where these decisions have been made,

19 but my understanding is as long as, for the

20 Standard in total, that there are positive benefits

21 to the consumer in some manner, either through

22 energy saved or through cost savings, there would

23 be justification for going forward with that
356

1 Standard, even if within a certain product class

2 there may be negative impacts.

3 MR. BROOKMAN: Michael Kido.

4 MR. KIDO: I think the bottom is there's

5 going to be a balancing of all of these

6 considerations.

7 MR. BROOKMAN: Okay? Okay.

8 Let's proceed. Thank you.

9 PRELIMINARY MANUFACTURER IMPACT ANALYSIS

10 MR. CARMICHAEL: Good afternoon. My

11 name is Rob Carmichael.

12 I'm with Navigant Consulting. I'm going

13 to go briefly over the Manufacturing Impact

14 Analysis.

15 So, the, the Preliminary Manufacturing

16 Impact Analysis has already taken place. It's in

17 conjunction with the Engineering Analysis.

18 Obviously the purpose of the MIA is

19 to assess the impacts of Standards on

20 manufacturers of the covered products. DOE

21 traditionally does this both quantitatively and

22 qualitatively.

23 Quantitatively, DOE uses the
357

1 Government Regulatory Impact Model, the GRIM, which

2 is an industry cash-flow model. And it's a

3 comparison of the industry net present value, the

4 value of all the manufacturers that

5 are producing this product in the base case. So,

6 so that's without Standards. And then in the

7 Standards case, it's the change in the net present

8 value that's the key output for the

9 MIA. So, traditionally, as the Standard gets

10 higher, that change becomes greater.

11 And there are two other more qualitative

12 components of the MIA I want to touch on because

13 they've been raised a little bit already here

14 today. We look at what's called a subgroup

15 analysis--subgroups of manufacturers.

16 In this case, maybe subgroups of

17 manufacturers of particular applications that are

18 in some way differently or more severely impacted

19 than other groups of manufacturers, typically they'll be small businesses 

20 or smaller

21 or low-volume manufacturers.

22 And then another characteristic that DOE

23 takes into account is cumulative regulatory burden. So,

24 that's going to be the impact of all
358

1 Regulations, from Department of Energy or other federal agencies on 

2 manufacturers of these

3 products.

4 And here are the three phases of

5 the MIA. I'm not going to go through them each in

6 detail, but at this stage we're beginning the

7 interview process, which is the beginning of Phase

8 3.

9 I'll just say that the interviews are

10 like the engineering interviews and are conducted

11 under NDAs. They're a critical input into this

12 analysis as they are to all of the analyses.

13 And we're starting to contact

14 manufacturers and begin that process at this point.

15 (Whereupon, at 4:43 p.m. ET, Mr. Albert

16 and Mr. Morris conferred, out of the hearing of

17 others and off the Record, during which the

18 following occurred:)

19 MR. CARMICHAEL: So, looking back at the

20 engineering or preliminary MIA interviews, there were

21 several salient concerns that came across from

22 manufacturers. And they're highlighted here.

23 We've touched on them before, and this

24 is combining both 
359

1 EPSs and BCs. Conversion costs. So, those are

2 taken into account, as was discussed earlier, both

3 in terms of capital and R&D, or product development

4 costs.

5 These are the one-time costs

6 associated with the Standard. It's a critical --

7 It's a critical component of the discounted

8 cash-flow analysis.

9 Obviously, the higher conversion costs

10 you have the greater the impact on the

11 manufacturer. Efficiency was a selling point;

12 that was another concern.

13 Manufacturers noted that it's

14 not something that they can sell up to. Therefore,

15 it's harder to

16 pass on the incremental costs associated with the

17 Standard, leading to margin compression, which was

18 a concern for manufacturers.
360

1 This is something that DOE typically

2 looks at as another one of the key inputs into 

3 the cash-flow model. And then lastly was regulatory burden.

4 So, looking at different international

5 standards for BCs and for EPSs, and looking at

6 the different costs of compliance that comes

7 with a lack of harmonization. So, at this

8 point we're asking for comments 

9 two issues.

10 One is how we capture the key

11 issues, and, second, on other aspects of regulatory

12 burden facing manufacturers.

13 MR. BROOKMAN: Maybe you could go back

14 to Slide 191. Wayne Morris, okay.

15 MR. MORRIS: Wayne Morris, AHAM.

16 Just a couple of quick comments on this,

17 and one would be that if you need contact

18 information for any of the people in our industry

19 who make battery chargers, we're more than happy to

20 help you. There are a number of companies that are

21 in this business that weren't in the business, say,

22 three or four years ago, and we'd be glad to, to
361

1 give you contact information for those companies at

2 any point in time. Just drop me a line.

3 Secondly, I note that on -- Let's

4 see. I've got Slide 191, I think.

5 Is that right? Yeah.

6 Your top one there in terms of

7 conversion costs mentions the significant cost in

8 time required for testing and safety approvals. I

9 would mention that for a true EPS-type of product,

10 that, that cost in time happens one time.

11 But, if you're viewing this as a, as a,

12 as a wall adapter for a battery charger, and seeing

13 that as a external power supply, that, then

14 that has to go through testing multiple times. So,

15 that cost is not once; it's every single time that

16 that wall adapter is designed and used.

17 So, -- And that would be for every

18 single model. So, it's, you know it's a

19 significant difference when you look at it from one

20 to the other.

21 I mean, if you truly, you, you make that

22 conversion once by the manufacturer of that EPS.

23 The battery charger, it's significantly more in,
362

1 more of an increase.

2 That's, that's all I have. Thanks.

3 MR. BROOKMAN: Okay.

4 Comments on this series of issues,

5 Preliminary Manufacturer Impact Analysis?

6 Yes, Michael.

7 MR. VLADIMER: Michael Vladimer,

8 Navigant Consulting.

9 I just want to thank Wayne for offering

10 those, and just wanted for everyone present in the

11 room, and, and Navigant, and working with DOE, and

12 anyone who wants to step forward, we would be very

13 amenable to contact and pass those on.

14 MR. BROOKMAN: So, that was that. Thank

15 you.

16 We're going to move on.

17 NOPR ANALYSES

18 MS. IYAMA: Good afternoon. I'm Sanaee

19 Iyama, with the Lawrence Berkeley National Lab, and

20 I'm going to present four of the sections that

21 constitute the NOPR stage analysis, starting with

22 the Utility Impact Analysis.

23 So, the purpose of this analysis is,
363

1 to assess the impact of

2 Standards on domestic electricity suppliers. And

3 the method that DOE has used in the past, and that

4 is going to, that we're going to use in this

5 rulemaking, is to use a modified version of NEMS,

6 which is a model, which is called NEMS-BT, and

7 which will allow to assess the effects of

8 Standards.

9 NEMS is the model that, that is

10 currently used by the EIA to develop the energy

11 forecast that you see in the annual, Annual Energy

12 Outlooks Reports. So, the inputs that we're going

13 to use for, in this model are the national energy

14 savings that come from the National Impact

15 Analysis.

16 And the outputs will be expressed in

17 terms of forecast of electricity generation, as

18 well as in terms of avoided capacity resulting from

19 the considered Standard level compared to a base

20 case.

21 And next, we have the Employment Impact

22 Analysis. The purpose of this analysis is just to

23 assess the impact of Standards on national
364

1 employment.

2 And Robert has been talking about the

3 direct employment. Here we are looking at indirect

4 employment impact.

5 And the method used here is to use the

6 ImSET model, which is the acronym for Impact of

7 Sector Energy Technologies. And DOE has been using

8 this model for quite some time now.

9 It, it allows to assess the change in

10 employment by segment, by, as consequence of new

11 Standards. And I'll move on to the Environmental

12 Assessment.

13 The purpose of the Environmental

14 Assessment is to assess the impact of Standards on

15 air emissions from electricity power plants. Here

16 we'll be using the NEMS BT model, which is the same

17 one used as in the Utility Impact Analysis.

18 And it allows to estimate the national

19 emission reductions of different emissions. We'll

20 be looking at carbon dioxide, mercury, nitrogen

21 oxide for the 22 States where these emissions are

22 not capped.

23 For the States where these emissions are
365

1 capped, as well as for sulfur dioxides where we

2 have an existing legislation capping these

3 emissions, DOE states that appliance Standards do not

4 have an impact on an emission. And so we'll, in

5 the end, we’ll only be reporting carbon, mercury, and NOx

6 in the 22 States where they are not capped.

7 In recent rule-makings DOE has started

8 to monetize the emission reductions. And the way

9 to do this is DOE is using the most current social

10 cost of carbon values developed by interagency

11 review.

12 The social cost of carbon is intended to

13 represent a monetary measure of the incremental

14 damage resulting from greenhouse gases emission.

15 And here on this slide you have an approximation of

16 the values that we'll be using to implement it.

17 And we'll be also be monitoring Nox

18 emissions resulting from the different considered

19 Standards.

20 Issues for be comments are here. We

21 will welcome comments related to any benefits

22 resulting from improved efficiency of these
366

1 standard for EPSs that have not been captured directly

2 by the products end users.

3 And second, we also invite comments on

4 possible approaches to monetize the emission

5 reductions.

6 MR. BROOKMAN: Wayne Morris.

7 MR. MORRIS: Wayne Morris with AHAM.

8 Just a quick question. Is the

9 determinant in these analyses using full-cycle fuel

10 cycle, or just site energy?

11 MR. BROOKMAN: Michael Kido.

12 MR. KIDO: I think in this it's just --

13 I don't think we've initiated a full field. That's

14 something that's currently underway right now.

15 MR. MORRIS: Okay. Thanks.

16 MR. BROOKMAN: Any thoughts on these two

17 comments? One's about monetizing, and also ways to

18 capture these effects.

19 Yes, Larry.

20 MR. ALBERT: Just more of a, more of a

21 question. I am this close to think selecting for

22 only the benefits that might be accrued that are

23 not already analyzed, right?
367

1 There might be, in fact, some

2 disadvantages associated with this that have not

3 been analyzed as well. Are those also of interest

4 to the Department?

5 MR. BROOKMAN: Like what, Larry?

6 MR. ALBERT: For example, you know, for

7 example, life-cycle analysis of, of alternate

8 technologies that may have much greater impact

9 environmentally than some older technologies that,

10 you know, may at first blush seem to be less

11 efficient.

12 MR. BROOKMAN: I see.

13 (Whereupon, at 4:53 p.m. ET, Mr. Kido

14 and Mr. Petrolati conferred, out of the hearing of

15 others and off the Record, during which the

16 following occurred:)

17 MS. IYAMA: Sure.

18 MR. BROOKMAN: Additional comments on

19 these comment boxes?

20 (Whereupon, at 4:53 p.m. ET, no response

21 was had.)

22 MR. BROOKMAN: We don't have any

23 comments at this point. 

24 MS. IYAMA: I'm
368

1 going to move on to the last section that we'll be

2 covering today. Thanks for hanging on all day with

3 us.

4 So, it it's the Regulatory Impact

5 Analysis. And the purpose of this analysis is to

6 investigate the national impacts of non-regulatory

7 alternatives compared to mandatory Standards.

8 Some of the regulatory alternatives that

9 we might consider include the following: Consumer

10 rebates, consumer and manufacturing tax credits,

11 voluntary efficiency targets, early

12 replacement and bulk government procurement.

13 The method that we'll be using is

14 basically we're going to develop a

15 separate spreadsheet for each of the non-regulatory

16 scenarios, and we'll be estimating their impacts

17 based on previous experience with the considered

18 policies.

19 The outputs are similar to the ones that

20 we had for the National Impact Analysis. They're

21 expressed in terms of national energy savings and

22 net present value of the non-, and net present

23 value for the non-regulatory alternatives.
369

1 I don't have a place for comments, but

2 any comments on this aspect of the analysis

3 are welcome?

4 MR. BROOKMAN: On regulatory impact

5 analysis; comments?

6 (Whereupon, at 4:54 p.m. ET, no response

7 was had.)

8 MR. BROOKMAN: Okay, thank you.

9 So, now, as promise early this morning,

10 there's an opportunity for any additional comments.

11 Any other issues that individuals wish to raise as

12 points that haven't been covered sufficiently?

13 Because we're, we're drawing to a close

14 here.

15 MS. PORTER: This is just a housekeeping

16 item, but I think there were some sheets -- This is

17 Suzanne Porter. -- that were passed around with

18 business cards on them, right?

19 MR. BROOKMAN: Yes.

20 MS. PORTER: I don't know. I didn't get

21 one. I don't know.

22 MR. BROOKMAN: I just handed

23 out an Evaluation Form.

24 Did everybody -- I see it's circulating
370

1 back. Did everybody get a copy of that?

2 And the title is correct.

3 So, then, no final comments at this

4 point? We have Wayne Morris.

5 MR. MORRIS: Make a couple. 

6 Thanks first to -- I think it's important that we

7 appreciate all the work that's gone into this.

8 This is a tremendous amount of

9 engineering and technical time, business time,

10 staff time, consultant time. And I think that

11 speaks to the complexity of the product

12 that we're dealing with here.

13 We still -- I know the Department is

14 pretty much finished with it, at least, so we'll

15 know the exact extent of the test procedure yet.

16 And it's important that we finish that up.

17 And we're certainly hoping that we'll

18 see that in the next couple of weeks. But, in any

19 case, I certainly, I do want to appreciate a number

20 of things that the Department has done in this
371

1 analysis, and assure you that, first thing, is

2 that we've encouraged the Department to do

3 a rulemaking on battery chargers for a long time.

4 And we're pleased that it's

5 moving through the system. It is

6 complicated, and so we are very much

7 appreciative of the fact that the Department is not

8 taking a one-size-fits-all approach to battery

9 chargers, and not one formula that's used for

10 everything.

11 There's not one case that's used for

12 everything. You're not trying to lump all battery

13 chargers into one or two, or even three classes of

14 product.

15 It's very important that we

16 see these in terms of the way that they're actually

17 used. Lastly, I think that -- Or not lastly, but

18 next I would say that one of the things that

19 we emphasized at the last workshop is 

20 the usage; that the product has to be evaluated in

21 this system according to the way that the consumer

22 actually uses it.

23 And so the usage profiles that the
372

1 Department is working with are really critical, I

2 think, both to the thoroughness of the

3 evaluation, and also to be able to give the right

4 picture to the consumer, and to the Country, for

5 that matter, of what the savings will be.

6 It would be, you know,

7 inappropriate to build a case for an energy

8 efficiency if we are looking at usage patterns

9 that don't reflect the way that the product is

10 used. And, in fact, the law tells us that we have

11 to do that.

12 We have to look at the product the

13 way that it is actually used. "Representative," I

14 think is the way that they term it.

15 We appreciated, and stated a number

16 of reasons why we believed that external power

17 supplies and battery chargers are not the same.

18 I'm not going to go over that ground again.

19 I think that you get that. I think that

20 we also are studying the two-year implementation

21 proposal that the Department has made.

22 Some of that does depend upon the

23 candidate standards level that's chosen. You know,
373

1 it -- At this point in time the Department is

2 looking to us to say, "Okay, how's a two-year

3 implementation?"

4 Now, we recognize that within the

5 boundaries of the law, the Department has

6 the ability -- This is not NASA, and so we, we --

7 The Department has the ability to set an effective

8 date, basically; you know, X to Y.

9 I mean, there's zero to

10 whatever. Unfortunately, 

11 the needed amount of time is very much dependent

12 upon the candidate Standards level, or actually not

13 candidate, but final Standards level that's chosen,

14 because the more complex it is, the more time it

15 takes for a manufacturer to change over.

16 I would say that we do appreciate the

17 two years. I would think that we will study

18 that and take that in earnest.

19 We have spoken in the past, and

20 encouraged something in that range, but now that

21 we're looking at a system where the Department

22 tends to be leaning toward, not final yet, but

23 leaning toward a possibility that a wall
374

1 adapter would be both, this puts a much greater

2 burden on manufacturers, and may create a situation

3 where greater time will be needed for

4 implementation.

5 We'll certainly give that thought, every

6 thought, and respond to that. But, we do want to

7 make it as soon as possible.

8 We understand the need to have the

9 savings accrue for the, for the country and for

10 consumers, but we also don't want it to be at the

11 cost of having manufacturers go out of business.

12 And I know the Department shares that, and that's

13 why the analysis is so complete and, and so

14 carefully done.

15 To the extent that we in our industry

16 can help in any way, as we've said before, we

17 certainly are willing to do more, and do it

18 with you, as we always have done. Just want to

19 appreciate all the time that you took to have

20 this workshop today, the ability to have a web

21 broadcast.

22 Looking forward to the day when the web

23 broadcasts are two-way instead of just one-way, and I
375

1 know you're working on that. And we do

2 appreciate that.

3 And so thanks very much. Look forward

4 to getting some of these other documents

5 electronically, as well.

6 Thanks. Thanks to all of the people

7 from Navigant and D&R, and all the other

8 people that worked on this as well.

9 Thanks.

10 MR. BROOKMAN: Thank you.

11 Other closing comments here?

12 Suzanne Porter

13 MS. PORTER: Suzanne Porter.

14 I just wanted to echo Wayne's comments

15 regarding the effort that was put forward to

16 create this technical support document. It's

17 Herculean, and I just want to comment from the

18 perspective of someone who has 

19 looked at these types of analyses before.

20 I really admire your efforts, and I

21 think a lot of good work has been done. The main

22 thing I just want to highlight in my closing

23 comments is that, you know, even though the DOE has
376

1 got a lot of good direction in the Technical

2 Support Document, we feel that the

3 biggest weakness is the lack of information on duty

4 cycles.

5 And I think we've been talking about

6 that a lot today. And PG&E recommends that without

7 empirical data on duty cycle, or even with duty

8 cycle data that would exist and would have a very

9 wide standard of deviation, that a better

10 approach would be to use a single, more simple

11 approach that could be, you know, based on common

12 sense, where the product is either charged some of

13 the time, or it's never charged, or very rarely

14 charged because it's an emergency backup product.

15 And we feel that this approach would

16 lead to a more transparent Standard, a Standard

17 that DOE could stand firm on because they wouldn't

18 be relying on assumptions associated with duty

19 cycles and the unit energy consumption that's shown

20 in the battery charger Standards analysis.

21 And I'm speaking specifically to the

22 battery Standard status here. So, PG&E’s comments

23 will give more detail around why we think this is a
377

1 good approach.

2 But, from our perspective, 

3 that's the one thing I'd like to highlight as an

4 opportunity for going forward with the next round.

5 So, thanks to everyone here, and appreciate the

6 opportunity to participate

7 MR. BROOKMAN: Thank you.

8 Final comments? Additional comments?

9 Larry?

10 MR. ALBERT: Again I'd like to

11 compliment in Agency, the Department upon the work

12 that's been done here. It's all been very

13 detailed, very thoughtful.

14 And I'm also very appreciative of the

15 kind of dialogue that we were able to have here and

16 in other meetings that I think has resulted 

17 in improvements, or at least, you know, sincere

18 consideration of the point of view of our industry.

19 Going forward, I think that, you know,

20 many things are very good about what we see so far.

21 Obviously the consideration given to the

22 classifications of products and differentiating

23 them based upon what are some pretty clearly
378

1 discernable criteria, and also upon some

2 recognition as to that those products

3 represent different categories with respect to

4 technology and efficiency, and also an appreciation

5 for the recognition that 

6 the usage profiles is a key component to both

7 determining the benefit to consumers,

8 and also what the right sorts of technical

9 solutions might be to improving real efficiency,

10 and therefore real benefit.

11 It encouraged, I would submit, any

12 number of comments during the meeting.

13 And, and obviously there's some areas, you know,

14 where we have some key issues.

15 And, and notably of those is the

16 determination of when an EPS is an EPS or a battery

17 charging system, and also the difficulty in, in

18 creating what we think is sort of a fairer CSL

19 assessment, CSLs for power tools within the

20 category of BC 4, when the dominant contributor

21 there is laptop power supplies.

22 And so I think, you know, with those

23 issues, you know, if we can work on those issues, I
379

1 think what would result would be something that,

2 you know, we might be able to move forward with.

3 The only other consideration I think we

4 need to give to is the emergence of lithium-ion

5 batteries in motor-operated appliances, which has

6 been relatively recent with

7 respect to the length of time that the entire

8 consideration of battery charging system efficiency

9 has taken place.

10 And, and so that has an effect upon

11 both technologies that are available, some of the

12 results that are there, and also some of the

13 technical solutions.

14 So, anyway, thanks again.

15 MR. BROOKMAN: Right.

16 MR. ALBERT: And I was glad to be a

17 participant in the activities today.

18 MR. BROOKMAN: Other closing remarks?

19 Ric.

20 MR. ERDHEIM: Yes. I want to echo what,

21 what Larry just said regarding the amount of

22 documentation, the work that went into it.

23 Suzanne said it. It's huge.
380

1 And I do appreciate all the

2 work you guys did. Just a few comments here.

3 You know, I turned right to the

4 Executive Summary in the beginning of

5 the TSD document. You know, it says by Statute the

6 U.S. Department of Energy must establish energy

7 conservation standards that are technologically

8 feasible and economically justified, and would

9 achieve a maximum improvement in energy efficiency.

10 And I want to emphasize the, you

11 know, "economically justified" in that for some of

12 the products that we were discussing today -- I'm

13 not going to go and rehash the issues

14 that we've already discussed, but as far

15 as, you know, the usage profiles and stuff, I think

16 that all plays into some of the products

17 with the low price points, and that

18 are economically feasible.

19 Regarding the battery definition, or the

20 definition for EPS versus battery charger, I

21 think there was some good discussion on that. We

22 -- I think that there's, can be a solution obtained

23 where EPSs for battery chargers would not be duly
381

1 regulated under both.

2 And I hope that we can come to a

3 consensus definition to accommodate

4 that. Thanks.

5 MR. BROOKMAN: Final comments?

6 Additional comments?

7 (Whereupon, at 5:08 p.m. ET, no response

8 was had.)

9 MR. BROOKMAN: So, then for my part I'm

10 going to turn it back to Vic Petrolati for closing

11 remarks. I want just to say thanks to all of you.

12 This has been a very positive meeting.

13 Lot of back-and-forth.

14 Very useful. Very productive, thanks to

15 all of you.

16 Vic Petrolati.

17 CLOSING REMARKS

18 MR. PETROLATI: Yeah. Thanks, Doug.

19 Late Thursday afternoon I hit the "Print" button

20 on our Technical Support Document and realized for

21 the first time it was 580 pages, not including the

22 Appendices.

23 MR. MORRIS: Not including; 88.
382

1 MR. PETROLATI: I realize what kind of

2 commitment it takes to be a stakeholder in this

3 process, especially with all the other commitments

4 you have for other products and other Regulations.

5 Like I say, the time that you've spent here I think

6 was very valuable for us.

7 We are certainly appreciative of the

8 time you've spent as part of this process. We need

9 your comments.

10 We need your written comments as part of

11 this process to make improvements and to handle all

12 of the issues that we've discussed today.

13 Again, informally, we'll have a Federal

14 Register Notice indicating that the comment period

15 will be extended to the twenty-ninth, the end of

16 the month, but we need your written comments by

17 that point in time to cover many of these issues

18 and many of the solutions that you have proposed to

19 us today.

20 Again, I thank you. I realize how

21 difficult it is in terms of time commitments with

22 this process, as well as the California process, to

23 be actively engaged in all of these areas.
383

1 That's about it.

2 MR. BROOKMAN: There's all the

3 information surrounding how to submit your

4 comments. You all have that in your packet.

5 That's good.

6 (Whereupon, at 5:10 p.m. ET, the above

7 Public Meeting was concluded.)

8 I certify the foregoing, as

9 submitted to the U.S. Department

10 of Energy on this date in WORD

11 .rtf format, and before editing by

12 others, to be a true transcript

13 from my notes.

14 E-signature: D. I. Bunn

15 CSR CP RPR

16 CERTIFICATION

17 I, D. I. Bunn, a Registered

18 Professional Reporter, Certified Conference

19 Reporter and Notary Public, do hereby certify that

20 the foregoing was duly taken and reduced to writing

21 before me at the place and time therein mentioned.

22 I further certify that I am neither related to any

23 of the parties by blood or marriage, nor do I have
384

1 any interest in the outcome of the above matter.

2 In witness whereof, I have hereunto set

3 my hand and affixed my official seal, at

4 Washington, D.C., USA, this 15th day of October,

5 2010.

6 

 E-signature: D. I. Bunn

7 

 Notary Public

8 

9 My Commission expires January 5, 2012.

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