# TRANSCRIPT OF PROCEEDINGS

HERITAGE REPORTING CORPORATION Official Reporters 1220 L Street, N.W., Suite 206 Washington, D.C. 20005

- 4018 (202) 628

- 4888 contracts@hrccourtreport ers.com IN THE MATTER OF: ) ) TEST PROCEDURES FOR ) RESIDENTIAL AND CERTAIN ) COMMERCIAL WATER HEATERS ) CONVERSION FACTORS ) RULEMAKING MEETING )

Pages: 1 through 173

Place: Washington, D.C.

Date: May 28, 20151

Heritage Reporting Corporation (202) 628

- 4888 BEFORE THE U.S. DEPARTMENT OF ENERGY OFFICE OF ENERGY EFFICIENCY & RELIABLE ENERGY

IN THE MATTER OF: ) ) TEST PROCEDURES FOR ) RESIDE NTIAL AND CERTAIN ) COMMERCIAL WATER HEATERS ) CONVERSION FACTORS ) RULEMAKING MEETING )

7th Floor, Room 7140 OHA Conference Room Department of Energy 950 L'Enfant Plaza Washington, D.C.

Thursday, May 28, 20 15

The parties met, pursuant to the notice, at

10:04 a.m.

PARTICIPANTS:

Department of Energy :

ASHLEY ARMSTRONG ERIC STAS LAURA BARHYDT

Industry :

CHARLES W. ADAMS A.O. Smith Corporation

ADAM DARLINGTON Navigant Consulting, Inc.

MISTY GUARD Bradley Corporation

NATE KOGLER Bradley Corporation2

Heritage Reporting Corporation (202) 628

- 4888 PARTICIPANTS (Cont'd)

Industry : (Cont'd)

WILLIAM M. HEALY U.S. Department of Commerce National Institute of Standards and Technology

ALEKSANDR KOVALENKO HTP, Inc.

KAREN MEYERS Rheem Manufacturing Company

RUSSELL PATE Rheem Manufacturing Company

STEVE ROSENSTOCK Edison Electric Institute

AMY SHEPHERD Air

- Conditioning, Heating, and Refrigeration Institute

FRANK STANONIK Air

- Condition ing, Heating, and Refrigeration Institute

CHARLIE STEPHENS Northwest Energy Efficiency Alliance

JAMES YORK Rinnai America Corporation

HARVEY SACHS American Council for an Energy

- Efficient Economy

FRANK MYERS PVI Industries, LLC

J OSEPH BOROS Rheem Water Heating

CAROLINE DAVIDSON

- HOOD Air

- Conditioning, Heating, and Refrigeration Institute3

Heritage Reporting Corporation (202) 628

- 4888 PARTICIPANTS (Cont'd)

Industry : (Cont'd)

THOMAS McNUTT Air

- Conditioning, Heating, and Refrigeration Institute

AYKUT YILMAZ Air

- Conditioning, Heating, and Refrigeration Institute

R. BRUCE CARNEVALE Bradford White Corporation

MARK TAYLOR Bradford White Corporation

CHAD SANBORN Bradford White Corporation

ADAM S. OLSEN Sconset Strategies, LLC on be half of Bradford White Corporation

JAMES PHILLIPS Navigant

HAMPTON NEWSOME U.S. Federal Trade Commission

JIM LUTZ (Via Telephone)

Also Present :

DOUG BROOKMAN Public Solutions, Inc.4

Heritage Reporting Corporation (202) 628

- 4888 P R O C E E D I N G S 1

(10:04 a.m.) 2

MR. BROOKMA N: Okay. Let's start. Good 3

morning, everyone. Welcome. 4

MALE VOICE: Good morning. 5

MR. BROOKMAN: This is the public hearing on 6

conversion factor for consumer and commercial water 7

heaters. Today is May 28, 2015, here in a building 8

adjacent to Forre stal Building in Washington, D.C. 9

Glad to see you here this morning. Would you like to 10

make welcoming remarks? 11

MS. ARMSTRONG: Sure. Hi. 12

MR. BROOKMAN: We're going to start with 13

welcoming remarks from Ashley Armstrong as she finds a 14

microphone to do that. 15

MS. ARMSTRONG: I'm trying to figure out how 16

to work this thing. I'm Ashley for those that don't 17

know me. I'm working on it. I'm making my way there. 18

So I'd just like to welcome everyone to the 19

public meeting, apparently the really popular pu blic 20

meeting, for the conversion factor rule. We put 21

together some slides that are just high

- level summary 22

slides of our proposed rule, but really this public 23

meeting is all about you guys. You guys requested it, 24

so we're here to listen to anything that you guys want 255

Heritage Reporting Corporation (202) 628

- 4888 to bring to our attention, any data, any information 1

you want to share, any concerns to help inform our 2

next steps of the rulemaking. So we do appreciate 3

that all of you traveled here especially on such short 4

notice, and we look forward to s uch a great discussion 5

today. 6

MR. BROOKMAN: Thank you. Let's start with 7

introductions as we always do. I'll start to my 8

immediate left, and I think these microphones, which 9

we've spread across this conference table and I think 10

in the back there we're not going to be able to do so 11

well. 12

FEMALE VOICE: Okay. I'll

-- 13

MR. BROOKMAN: We'll see what we do. 14

FEMALE VOICE: Yeah. Should we put the 15

yellers in the back? 16

MR. BROOKMAN: Start right here with Steve. 17

Mr. ROSENSTOCK: Steve Rosenstock, Edi son 18

Electric Institute. 19

MR. STANONIK: Frank Stanonik, Air

20

Conditioning, Heating, Refrigeration Institute. 21

MR. STEPHENS: Charlie Stephens, Northwest 22

Energy Efficiency Alliance. 23

MR. YORK: James York, Rinnai American 24

Corporation. 256

Heritage Reporting Corporation (202) 628

- 4888 MR. BOROS: Joe Bo ros with Rheem 1

Manufacturing Company. 2

MR. MYERS: Frank Myers, PVI Industries. 3

MR. SACHS: Harvey Sachs, American Council 4

for an Energy Efficient Economy. 5

MR. PATE: Russell Pate, Rheem Manufacturing 6

Company. 7

MS. MEYERS: Karen Meyers, Rheem. 8

MR. KOVALENKO: Alex Kovalenko, HTP. 9

MR. ADAMS: Charlie Adams, A.O. Smith 10

Corporation. 11

MR. STAS: Eric Stas, DOE. 12

MS. BARHYDT: Laura Barhydt, DOE. 13

MS. ARMSTRONG: Ashley Armstrong, DOE. 14

MR. BROOKMAN: Let's go over here, please. 15

MR. PHILLIPS: J ames Phillips, Navigant. 16

MR. DARLINGTON: Adam Darlington, Navigant. 17

MR. HEALY: Bill Healy, NIST. 18

MS. DAVIDSON

- HOOD: Caroline Davidson

- Hood, 19

AHRI. 20

MS. SHEPHERD: Amy Shepherd, AHRI. 21

MR. CARNEVALE: Bruce Carnevale, Bradford 22

White Corporation. 23

MR. TAYLOR: Mark Taylor, Bradford White 24

Corporation. 257

Heritage Reporting Corporation (202) 628

- 4888 MR. SANBORN: Chad Sanborn, Bradford White 1

Corporation. 2

MR. OLSEN: Adam Olsen, Bradford White. 3

MR. YILMAZ: Aykut Yilmaz, AHRI. 4

MR. BROOKMAN: Great. Thanks to all of you. 5

Nice to see you he re this morning. Thanks for being 6

here. 7

All of you received a packet of information 8

I hope, and if you look at page 7 of this packet, 9

you'll see a truncated meeting agenda. We're going to 10

talk first about regulatory history and then move from 11

there to a rulemaking overview, move from there to a 12

description of issues addressed in the NOPR, and then 13

closing remarks. 14

Many of you I think are familiar with the 15

general format for these meetings. This packet h elp s 16

to guide the discussion, although, as Ashle y said, we 17

hope to elicit a lot of comment wherever it fits best 18

in the content provided here to hear from all of you 19

today. 20

I'd ask for your consideration of a few 21

simple ground rules. If you'd speak one at a time, 22

say your name for the record each tim e you speak. 23

There will be a complete transcript of this meeting 24

made available. If you could be concise to share the 258

Heritage Reporting Corporation (202) 628

- 4888 air time, keep the focus here. If you haven't turned 1

your cell phones on silent mode, please do so. 2

And webinar participants, we welc ome you. 3

The Department of Energy is trying to make these 4

meetings accessible to all. Please keep your phone on 5

mute and raise your hand to be recognized to speak and 6

then we'll try and see if we can work you into the 7

conversation here in the room. 8

So far as we know, the audio and everything 9

is working okay, right? 10

THE COURT REPORTER: Yes, sir. I hear you 11

all. 12

MR. BROOKMAN: Okay. Great. What about the 13

back row? 14

THE COURT REPORTER: They're very faint. 15

MR. BROOKMAN: Okay. We'll see what we can 16

do about that. 17

THE COURT REPORTER: I have a mic at the 18

podium, so if they

-- I mean, I know it's 19

inconvenient, but if you wouldn't mind

-- 20

MR. BROOKMAN: Okay. 21

THE COURT REPORTER:

-- going there, that 22

would be great. 23

MR. BROOKMAN: Okay. So do you want to 24

start with the content? 259

Heritage Reporting Corporation (202) 628

- 4888 MS. ARMSTRONG: Sure. So just to go through 1

a couple of these, many of you have been to our public 2

meetings before, but kind of how this works, we're 3

here today to talk about the crosswalk and the 4

proposed convers ions that we had in our notice of 5

proposed rulemaking. We're here to seek your feedback 6

and obviously discuss next steps. You may see issues 7

boxes throughout. Some of them correspond to those 8

that you will see in the NOPR itself. Obviously we 9

welcome c omments on any of it, so you shouldn't feel 10

like you need to just comment on those specific items. 11

The comment period closes on June 15, after we 12

already extended it once. 13

So at this time we're going to open it up in 14

case certain people want to make ope ning remarks 15

before we start into our content, or if they don't we 16

can jump right in. Up to you guys. 17

MR. BROOKMAN: Frank Stanonik? 18

MR. STANONIK: Frank Stanonik, AHRI. Yeah. 19

Since this meeting is maybe a little bit different 20

than normal ones, we a ctually kind of prepared 21

actually quite extensive opening remarks that kind of 22

try to give an overview of what we see as in fact why 23

we asked for the meeting and major issues. I've 24

actually got it as a PowerPoint. 2510

Heritage Reporting Corporation (202) 628

- 4888 MS. ARMSTRONG: Okay. 1

MR. STANONIK: If you want, we can load it 2

onto the computer

-- 3

MS. ARMSTRONG: Help, please. 4

MR. STANONIK:

-- and I can try and go 5

through it quickly. Not wanting to hijack the 6

meeting, we're going to raise a number of issues and 7

maybe

-- 8

MS. ARMSTRONG: Do you want to go stand up 9

there? 10

MR. STANONIK: I can stand up there, yeah. 11

MS. ARMSTRONG: Or you can sit there, 12

whatever you want, but this is going to be how you

-- 13

MR. STANONIK: Okay. Well, let me

-- I'll 14

do it sitting down. 15

MS. ARMSTRONG: Frank, do you want to go 16

through their presentation first and then do yours 17

or

-- 18

MR. STANONIK: Well, I was thinking we'd go 19

through ours and then as we

-- you know, we're going 20

to identify questions and issues, and I'm sure as you 21

go through yours we can then address them. But I 22

think as kind of an opening remark I'd rather

-- and 23

hopefully not take up too much time, but just kind of 24

give you an overview. 2511

Heritage Reporting Corporation (202) 628

- 4888 MR. BROOKMAN: If you've got a significant 1

number of comments, let's hear them now. 2

MR. STANONIK: Ok ay. 3

MR. BROOKMAN: Yeah. 4

MR. SACHS: Mr. Facilitator, this is Harvey 5

Sachs. I yield our time. 6

(Laughter.) 7

MR. BROOKMAN: I'm going to remember that, 8

Harvey. 9

MR. STANONIK: Ignore any files that say 10

FIFA bribes. 11

(Laughter.) 12

MS. ARMSTRONG: Fr ank. 13

MR. STANONIK: It should be the very last 14

one on the list there. No. It is

-- I'm sorry

-- DOE 15

Con Factor Notes For Meeting, halfway up. 16

MS. ARMSTRONG: Halfway up. 17

MR. STANONIK: Right there. 18

MS. ARMSTRONG: Got it. 19

MR. SACHS: Frank, thi s is Harvey. Will 20

these be distributed to the group? 21

MR. STANONIK: Actually, since I don't want 22

to take them back, anybody who wants can have a 23

printed copy. 24

MS. ARMSTRONG: Yeah. They'll go in the 2512

Heritage Reporting Corporation (202) 628

- 4888 docket. 1

MR. STANONIK: All right. So like I say, 2

I'll just try and go through the issues and recognize 3

that as we ask questions I will agree that we can 4

discuss them as they come up later. Otherwise we'll 5

mess up your agenda terribly. 6

All right. So just kind of overall issues, 7

and some of you may no t be aware, since the NOPR came 8

out and actually before we have been running tests in 9

our certification program and our members have been 10

running tests. So we did send some data in to DOE on 11

May 14 I believe it is, so some of this is also going 12

to be refl ecting what we believe we're seeing in the 13

data. 14

So basically I'll tell you our overall 15

concerns are that, all right, so the UEF conversion 16

allows most current models to comply with what are 17

proposed as the UEF minimums, but when we look at the 18

measured values we get, some of those measured values 19

don't align with the converted values and would 20

suggest the model is not going to

-- that the model 21

test results in the minimum are not let's say in 22

agreement and so potentially the model becomes 23

noncompliant. 24

And we see in our results at least that for 2513

Heritage Reporting Corporation (202) 628

- 4888 some of the minimums in fact it is not a neutral no 1

change in the standard, and two examples of that in 2

products that are fairly significant in the market, 3

for almost all of the electric resistance storage 4

water heaters, any draw pattern, the measured UEF 5

seems to be coming out consistently lower than what 6

the conversion factor equation says it should be. 7

And the consequence of that is that the 8

converted standard from our perspective now is more 9

stringent than the current standard. That's for 10

residential electric resistance. In the case of 11

residential gas, the models

-- and this actually goes 12

the other way in the case the models did. 13

In the high usage bin, we're seeing that a 14

majority of the results, the mea sured UEF is higher 15

than the converted UEF, and in this case they would be 16

above what is the minimum standard, so actually in 17

that case we're concerned. I mean, obviously the 18

whole idea is the conversion is supposed to be 19

neutral. We're concerned it's ac tually a relaxation 20

of the standard when you apply it to high usage gas 21

products. 22

MR. STEPHENS: Frank, I have a question

-- 23

MR. STANONIK: Yes? 24

MR. STEPHENS:

-- about that. This is 2514

Heritage Reporting Corporation (202) 628

- 4888 Charlie Stephens. Are the three

- quarters of gas 1

storage models th at have UEF greater, are they ones 2

that say most of them meet the standard now or 3

minimally meet the EF standard now, or are they all 4

exceeded anyway? 5

MR. STANONIK: Well, it's a mixed bag. 6

MR. STEPHENS: Okay. 7

MR. STANONIK: It's a mixed bag. I mea n, 8

first of all, we were only testing, with very rare 9

exception, we were only testing models that complied 10

with the standard that went into effect in April. 11

MR. STEPHENS: Close to a minimum compliance 12

or

-- 13

MR. STANONIK: Well, no. We've got some 14

ove r. We've got some over. And, Charlie, at the back 15

you actually will have, it's probably not going to 16

show up very well, but you have our table of results. 17

MR. STEPHENS: Oh, okay. 18

MR. STANONIK: So, you know, that's a 19

majority of our tested ones. 20

M R. STEPHENS: Okay. 21

MR. STANONIK: So then again this is, you 22

know, just trying to really lay it out here. Our 23

concern is the NOPR really is not making the 24

transition from EF to UEF possible. We're seeing 2515

Heritage Reporting Corporation (202) 628

- 4888 distinct differences between the EF and convert ed UEF 1

values that really are not let's say consistent where, 2

you know, you could just see the pattern, if you will. 3

And then the trend seems to demonstrate that 4

there's a marked shift from the UEF converted 5

calculation, if you will, to the UEF tested va lue for 6

several types of water heaters. And then the last 7

point here is that, again, you know, as it's very 8

clear in the statute, DOE is obliged to determine the 9

new standard that reflects the new test procedure and 10

no change in stringency. 11

As we see th is, the NOPR is not doing that. 12

We think in some cases, as I pointed out, the 13

proposed converted standard may be more stringent. In 14

one example, it's actually less stringent. So, again, 15

this is just kind of laying out some of the issues 16

we've seen in th e DOE analysis. 17

One of the things is equation for Q. That's 18

the estimated total consumption of a water heater. It 19

shows up on two pages, and I'm pretty sure it was 20

derived from the WHAM work, but in that equation the 21

standby loss is calculated as if it occurred for 24 22

hours, and when you're talking about fossil fuel 23

products you've got to factor out the amount of burner 24

on time. When the burner is on, the loss that 2516

Heritage Reporting Corporation (202) 628

- 4888 otherwise would occur through the flue tubes and out 1

when the burner is on, the transfer is going the other 2

way, so that period of time that potential surface of 3

loss is in effect the opposite. It's really the heat 4

exchanger. So, you know, that will change some of the 5

derived results I think. 6

MR. SACHS: Frank? 7

MR. STANONIK: Yes? 8

MR. SACHS: Excuse me. This is Harvey. As 9

we go through, can you give us a sense of things like 10

whether the variances are normal or biased in one 11

direction and sort of the little things like this? 12

Are these factors 1 percent or 10 percent, that 13

estimate of which things are big and which aren't? 14

MR. STANONIK: At this point I couldn't give 15

you the magnitude, but that is going to overestimate 16

the consumption. 17

MR. SACHS: Okay. Thank you. 18

MR. STANONIK: Yeah. Probably, probably for 19

a smaller tank size, a lower input product, the effect 20

is going to be greater. You could have a burner on 21

time that would approach two hours. On let's say a 22

residential duty commercial product, your burner on 23

time, probably an hour, maybe even a little bit less, 24

so yeah. 2517

Heritage Reporting Corporation (202) 628

- 4888 So then just again other questions. There's 1

an analysis. You show the constants for all the A, B, 2

C, D that are used in the, I think it's the WHAM 3

calculation or one of the calculations, and there's 4

really no explanation where those numbers came from 5

and we just don't

-- we've just got a question about 6

that. 7

We don't think you need separate conversion 8

factors for what has been described as standard and 9

low NOx gas water heaters. You do need one for the 10

ultra low NOx. It's a totally different burner, a 11

different design, but we really question whether we 12

need this extra complication. 13

This is one that was let's just say we are 14

scratching our heads. In Table III.21, which is the 15

information on the residential duty commercial water 16

heaters that were eval uated or were tested in this 17

analysis, three out of the seven don't fit the 18

definition of residential duty water heater. They're 19

inputs less than 75,000, and in fact none of them are 20

tested for more than 80,000 and the volumes were 21

generally I think 75 ga llons or so, but the main thing 22

is they actually in terms of their input and volume 23

parameter would have fit as a plain old residential 24

storage water heater, and yet they were tested for the 2518

Heritage Reporting Corporation (202) 628

- 4888 conversion factor for residential duty. 1

This is really a major one. We just don't 2

think there's been enough models tested to reflect a 3

cross

- section of residential duty water heaters that 4

are covered by this test procedure. We think there 5

should have been some more short units tested. We 6

think there's an issue that if you look at higher 7

efficiency heat pumps the conversion really doesn't 8

fit. We think there should have been more residential 9

duty commercial gas products tested, including some 10

with inputs up around 105,000, 100,000. And then we 11

just think, you know, when you look at the gas 12

products, there should have been maybe a better mix of 13

input volume size and venting type, and that would 14

really

-- well, that's primarily storage, but maybe a 15

little bit on the tankless instantaneous products. 16

We've also identi fied two products we think 17

should have been addressed and weren't. One of our 18

members has advised us they do have residential duty 19

electric instantaneous water heaters that fit the 20

definition in the test procedure and so they will need 21

a conversion factor

. 22

And then there is

-- well, I guess I'll say 23

there were. There were electric storage water heaters 24

that had inputs less than 12 kW and had what I call a 2519

Heritage Reporting Corporation (202) 628

- 4888 180 F thermostat. In the old DOE test procedure, 1

those products weren't tested because they had th at 2

high, high temperature thermostat, and yet under the 3

current definition those actually now would be 4

included as residential storage water heaters, 5

electric storage water heaters, and they really 6

weren't evaluated I think. And so maybe that's 7

another is sue is in the unit that we looked at would 8

be to look at models in fact that do have a higher 9

thermostat, although

-- whatever. 10

And then just as a general question, well, 11

basically, as we analyzed this, has DOE looked at the 12

basic repeatability of the un iform efficiency 13

descriptor test procedure? And, you know, I think 14

that's useful information for all of us. I mean, 15

we're doing the same thing. We're running a single 16

test old EF procedure, new UEF procedure, but I think 17

in terms of really trying to sor t that out we need a 18

better sense of what is the repeatability of the UED 19

test procedure. 20

And then again in Table III.5 there is a 21

determination of N, which is the number of

-- I 22

remember the number of times a tankless product 23

actually heats up and cools down completely or it's 24

the number of cycles. I forget which. But in any 2520

Heritage Reporting Corporation (202) 628

- 4888 case, we're concerned that in the current test 1

procedure, if you have a product that is multi

- firing, 2

you run half the cycles at the low fire, and we don't 3

think that that determin ation of N really factored 4

that in, nor did it perhaps recognize that in some 5

cases, if the design can't make it, you would run the 6

flow rate at a lower than specified value because the 7

unit can't hit the target. That may be less of an 8

issue when the outp ut is 125. 9

And then these will be admittedly probably 10

repetitive for some people, but we think there's 11

really big implementation issues, and the primary one 12

is, as the NOPR notes, what's being proposed is that 13

for certification reports filed after July 1 3, and 14

I've inserted in there until May 1 because on May 1, 15

2016, reports have to be filed for all models on the 16

market at that time. 17

So only for new certification reports filed 18

after July

-- or I'm sorry. Any certification report 19

filed between that per iod will include both EF and the 20

UEF or the thermal efficiency and standby loss and UEF 21

if it's a residential duty. And then it also 22

indicates that there are no changes to the FTC energy 23

guide label information at this time, and that won't 24

change until FT C changes its regulations. 2521

Heritage Reporting Corporation (202) 628

- 4888 So we're understanding that at the moment 1

potentially on July 14 you would have a UED test 2

procedure in effect, and the FTC energy guide label 3

will still be based on information derived from the 4

now old EF test procedure. And as we go through, 5

hopefully I just want to just make sure we understand 6

DOE's approach to that. 7

And then we really don't see how this 8

rulemaking is going to be finalized by July 13, and so 9

this raises questions about if it's not finalized by 10

July 13 and a manufacturer wants to advertise his 11

efficiency ratings in literature, his own product 12

descriptions and whatever else, how will the 13

manufacturer determine the UEF rating, which he will 14

be obligated to display we believe? 15

And then likewise, without that conversion 16

factor, how can the federal minimum standards be 17

translated to a minimum UEF requirement, and then the 18

last part of this is okay, so if a new model is 19

introduced after mid

- July and the standard in effect 20

is still the EF standard, how are they go ing to 21

certify that they comply with that standard if the 22

operative test procedure is a UED test procedure on 23

July 13? 24

And then my favorite one is grandfathering. 2522

Heritage Reporting Corporation (202) 628

- 4888 In a number of places in the NOPR DOE confirms their 1

intent that products currently comply ing with the 2

minimum efficiency standard will not fail to comply 3

where the standard minimum conversion factor has been 4

applied. In a number of these citations DOE talks 5

about units complying with minimum standards, and so 6

what is not clear to us anyhow is so I have a model 7

that is complying today with the existing minimum 8

standard that went into effect on April 15. 9

Are the units of that model manufactured 10

after July 13 also considered to comply with the 11

converted UEF standard? And that would be what we 12

believe is classic grandfathering, as happened back in 13

the 1990s. If the answer to that is no, we need to 14

understand how DOE got to that conclusion because 15

clearly we don't agree. 16

And then the other one which again matters 17

significantly is in this analy sis the converted. 18

proposed converted formulas talk about using rated 19

volume. We just really want to make sure what rated 20

volume values were used in the analysis. Did they use 21

the current name plate rated volume of 30, 40, 50 22

gallons or whatever? 23

And i f they didn't, it really needs to be 24

redone because, as we've pointed out, if you use the 2523

Heritage Reporting Corporation (202) 628

- 4888 rated volume as defined in the UED test procedure and 1

actually repeated in this NOPR, that change on a 2

practical basis does increase the stringency of the 3

current fed eral standards for some products and that's 4

really not allowed by the law. 5

And then this gets to the point, you know, 6

we've put in a petition to have DOE reconsider this. 7

That was published. I know for a fact that the 8

comments were overwhelmingly suppo rtive of ours from 9

many different stakeholders, and we need to know 10

what's going on with that petition. We believe it 11

needs to be resolved before this rule can be 12

finalized. 13

And maybe at this point again I don't really 14

want to

-- I'm not intending to hi jack the meeting 15

here. We can maybe stop here and when we get into 16

some of the test data we can cover this. So let me 17

suggest that. 18

MR. BROOKMAN: How many more slides do you 19

have? 20

MR. STANONIK: When we get to this

-- 21

MALE VOICE: Six. 22

MR. STANO NIK:

-- one, two, three, four

-- 23

six with the tables, yeah. 24

MR. BROOKMAN: I'm just thinking about 2524

Heritage Reporting Corporation (202) 628

- 4888 switching back and forth between these two. 1

MS. ARMSTRONG: I would wait and do it at 2

the end. 3

MR. BROOKMAN: Do it at the end? 4

MS. ARMSTRONG: Yeah

. 5

MR. STANONIK: Okay. 6

MR. BROOKMAN: Okay. So let me see if we 7

have additional opening remarks here at the outset. 8

And thank you, Frank, for

-- 9

MR. STANONIK: Thank you. 10

MR. BROOKMAN: For all of that. Steve 11

Rosenstock? 12

MR. ROSENSTOCK: Steve Rosenstock, Edison 13

Electric Institute. I'm going to go, and I appreciate 14

all the information that was just presented, but 15

actually I have a different question. I already filed 16

some comments. And it's really about, it's kind of a 17

process issue because i n this NOPR that talked about 18

test procedures there are energy conservation 19

standards for residential duty commercial water 20

heaters. So, as I was looking at it, I was kind of 21

surprised to see an energy conservation standard in a 22

test procedure NOPR, but I guess one question I had, 23

and I'm sure that it was answered, but was when did 24

these standards take effect? 2525

Heritage Reporting Corporation (202) 628

- 4888 And the reason I'm asking that is I had 1

never seen this definition of a water heater before, 2

and I'm not sure if this is a reclassification or a 3

b rand new product that DOE has never regulated. 4

Again, I'm not in the water heating industry. I just 5

try to follow the issue. So, if it's a new product 6

that DOE has never regulated, typically manufacturers 7

get three to five years to comply with the stand ard. 8

The way it looks in the NOPR is that it takes effect 9

immediately. There is no lead time for the 10

manufacturers. 11

Now again, it could be that these are 12

exactly what they're doing now in terms of under their 13

current status as a "commercial water heate r", but 14

again, in terms of just again as kind of a third party 15

just seeing this, it just seems like all of a sudden 16

it's a new product with a new definition with a new 17

energy efficiency, an energy conservation standard, 18

and it just surprised me that there was no lead time 19

whatsoever. 20

So, again, I'm sure

-- I hope to be 21

corrected. We already filed comments to that, but 22

again it's more of a process issue. Is it a 23

reclassification or is it

-- 24

MS. ARMSTRONG: Yes. 2526

Heritage Reporting Corporation (202) 628

- 4888 MR. ROSENSTOCK:

-- a new product? 1

MS . ARMSTRONG: It's not a new product. 2

MR. ROSENSTOCK: What? 3

MS. ARMSTRONG: It's not a new product. 4

MR. ROSENSTOCK: Okay. 5

MS. ARMSTRONG: It's a reclassification. 6

You're talking about light duty? Is that the issue? 7

MR. ROSENSTOCK: No. Resid ential duty 8

commercial water heaters. 9

MS. ARMSTRONG: Right. 10

MR. BROOKMAN: Ashley Armstrong. 11

MS. ARMSTRONG: This is Ashley from DOE. 12

What we did, and you guys can feel free to chime in at 13

will if you'd like, but what we did when we did the 14

uniform efficiency descriptor test method was we 15

created a new method of tests for a sliver of the now 16

regulated commercial market that is tested. It's 17

defined and tested in accordance with the uniform 18

efficiency descriptor test procedure, but it's still 19

regulat ed under the commercial section in our 20

regulations. So we're translating this new method and 21

new descriptor using the conversion factor analysis 22

for already regulated products I think is the best way 23

to say it. 24

MR. YORK: Yeah. You're just shifting the 2527

Heritage Reporting Corporation (202) 628

- 4888 test procedures. 1

MS. ARMSTRONG: There's no new

-- 2

MALE VOICE: Right. 3

MS. ARMSTRONG: It's just there's a portion 4

of the commercial market that has shifted to be tested 5

similarly to what I would say consumer models, and 6

that shift results in a chan ge in descriptor for 7

already regulated products that meet that definition. 8

The definition was established in the test procedure 9

rule, and all the dates and associated requirements 10

were established by statute. 11

MR. ROSENSTOCK: Okay. Thank you for that 12

c larification. It was not clear when I read the NOPR. 13

Thank you. 14

MS. ARMSTRONG: Yeah. It's probably more 15

clear if you read the test procedure, which was

-- 16

MR. BROOKMAN: Charlie? 17

MS. ARMSTRONG:

-- finished a year ago. 18

MR. ADAMS: Charlie Adams , A.O. Smith. 19

Yeah. I'll just pile on. The residential duty 20

commercial does have a minimum efficiency performance 21

standard in effect today. It's just being translated 22

by a conversion factor of thermal efficiency and 23

standby loss to the new uniform desc riptor, so it's 24

changing the yardstick by which we measure something 2528

Heritage Reporting Corporation (202) 628

- 4888 that's already measured. 1

MR. ROSENSTOCK: Okay. Thank you. And 2

again, it was just the fact that, you know, it said 3

test procedure and then it came in with the new 4

standard, so that al so added to my confusion there, so 5

thank you. 6

MR. BROOKMAN: Thank you, Steve. Additional 7

opening remarks here or comments here at the outset 8

before we dive into the detailed content? 9

MR. SACHS: This is Harvey, and I would like 10

to just remind all of us that much of this is about 11

requirements that come out of AEMTCA, which was based 12

on pretty broad stakeholder agreement a few years ago, 13

so I hope there are relatively few surprises except 14

for the issues specifically addressed in this public 15

meeting. 16

M R. BROOKMAN: Okay. Thank you. 17

Final comments? We're about to go to the 18

content in the slides. 19

MS. ARMSTRONG: We have a couple people that 20

walked in late. 21

MR. BROOKMAN: Yes. Those of you who did 22

not get a chance to introduce yourselves, please d o 23

so. 24

MR. KOGLER: Yes. Nate Kogler with the 2529

Heritage Reporting Corporation (202) 628

- 4888 Bradley Corporation. We are the owner of Keltech. 1

MS. GUARD: Misty Guard with Bradley 2

Corporation. 3

MR. NEWSOME: Hampton Newsome, Federal Trade 4

Commission. 5

MR. McNUTT: Thomas McNutt with AHRI. 6

MR. BROOKMAN: Thank you. 7

MS. ARMSTRONG: So does anybody care if I 8

present from here, because otherwise I'm going to be 9

walking in front of you constantly. Is that okay? 10

MALE VOICE: Sure. 11

MALE VOICE: Yes. 12

MS. ARMSTRONG: We'll let Bill go over ther e 13

when he's talking about fancy equations. 14

So just to talk about the history kind of 15

how we got here, and actually, Harvey, you just 16

reminded us all pretty well how we got here, but as 17

you know, the statute provides us with the authority 18

to establish not only standards but also test 19

procedures for residential water heaters, for consumer 20

water heaters and commercial water heaters. 21

Subsequent amendments in the American Energy 22

and Manufacturing and Technical Corrections Act in 23

2012 amended the statute to r equire DOE to establish a 24

uniform energy efficiency descriptor with the 2530

Heritage Reporting Corporation (202) 628

- 4888 accompany test method, and then once that is 1

established it also established a set of guidelines 2

for transitioning to that new method of test and that 3

new metric. So that's what we're here to talk about 4

today. 5

So this is just some of the history of kind 6

of how we got here. The most relevant portion is that 7

in July of 2014 of last year we actually published the 8

final rule of the uniform efficiency descriptor test 9

method. As we said, that's applicable to all consumer 10

or almost all consumer water heaters as you know them 11

today, as well as a sliver of the commercial market, 12

which Steve referred to in his opening remarks. 13

So just some steps in the rulemaking 14

process. The comment perio d closes on June 15. 15

That's after we have already responded to a request 16

for an extension, so as you know and we are holding 17

the public meeting today, so there's about two weeks, 18

a little over two weeks to file comments after this 19

public meeting. 20

So I'm going to talk about the purpose, what 21

we were trying to do with the conversion factor. We 22

were trying to provide a method for converting 23

existing ratings where applicable, so there are some 24

bounds that are spelled out in the NOPR about how the 2531

Heritage Reporting Corporation (202) 628

- 4888 conversion factor can apply, but it's supposed to 1

provide a method for a limited amount of time to 2

convert ratings in lieu of retesting everything all at 3

once. 4

It's also to provide a method to convert the 5

April 2015 standards that just came in to new 6

equations und er the new metric. And then, as you have 7

already noticed, we only develop conversions for 8

categories of equipment that are subject to standards 9

today and where commercially available units actually 10

exist. 11

So I do want to highlight this is a table in 12

the preamble of the actual proposed rule, and I think 13

it's a pretty important table in my opinion. What it 14

does is give you a high

- level summary of some of the 15

requirements and key dates in what I would call a non

16

lawyerfied fashion. 17

MALE VOICE: No offens e. 18

FEMALE VOICE: None taken. 19

MS. ARMSTRONG: So test procedure effective 20

date comes in July 13, 2015, of this year, so what 21

does that really mean? For new basic models 22

introduced into commerce on or after July 2015, 23

manufacturers must begin testing a nd representing 24

efficiency using the UEF metric pursuant to the UEF 2532

Heritage Reporting Corporation (202) 628

- 4888 test procedure and sampling plan. 1

There are a couple provisions in the July 2

2014 test procedure final rule that do allow for the 3

use of an AEDM in limited cases. That AEDM should 4

also b e based upon the UEF test procedure. So this is 5

new models. New models introduced after that date 6

have to be tested. There's no conversion. 7

Conversion factor effective date, so date of 8

publication of the conversion factor final rule in the 9

Federal Reg ister for basic models certified using the 10

EF metric or thermal efficiency and/or standby loss 11

metrics prior to July 13, 2015. 12

So, if you have a currently existing model 13

that's already certified with the Department under one 14

of those metrics and under on e of those regulatory 15

schemes, manufacturers must transition all of their 16

representations to UEF either by applying the 17

conversion factor equations as established by the 18

final rule or by using the UEF test procedure and 19

sampling plan or once again an AEDM that is based on 20

the UEF test procedure as applicable. 21

So basically once we finalize the final 22

rule, date of publication is the effective date. 23

That's when your one year starts. For previously 24

certified models, not new models, they must begin 2533

Heritage Reporting Corporation (202) 628

- 4888 using thi s conversion factor and transitioning, or at 1

your discretion you can also use the UEF test 2

procedure. 3

Conversion factor ending date. Ending one 4

year after the publication of the conversion factor 5

final rule, all basic models must be tested in terms 6

of U EF using the UEF test procedure and sampling plan 7

or an AEDM that was based on the UEF test procedure 8

where allowed. After that one

- year point everything 9

is based on testing. Everything must be tested and 10

recertified based on that testing. Okay? 11

MS. S HEPHERD: Ashley, I have a question. 12

So that says all representations in UEF, so that means 13

although you can certify to the Department EF and UEF, 14

your representations can't have anything about EF? 15

MS. ARMSTRONG: So I don't think we 16

addressed that spec ifically, but we can address that 17

in our comments. 18

MR. BROOKMAN: Charlie Stephens? 19

MR. STEPHENS: Charlie Stephens. Quick 20

question. That means as I read this that something on 21

the order of 14 months from now the conversion factor 22

expires? 23

MS. ARMS TRONG: Correct. 24

MR. STEPHENS: And everything has to have 2534

Heritage Reporting Corporation (202) 628

- 4888 been tested

-- 1

MS. ARMSTRONG: Correct. 2

MR. STEPHENS:

-- for recertification by 3

that time? 4

MS. ARMSTRONG: Correct. So the conversion 5

factor is really a one

- year thing. 6

MR. BROOKMAN: K aren? 7

MR. STEPHENS: Okay. 8

MS. MEYERS: So Karen Meyers with Rheem. So 9

the conversion factor NOPR is essentially establishing 10

the values with which you have to test to beginning 11

July 13, is that correct? 12

MS. ARMSTRONG: No. 13

MALE VOICE: The testin g methods. 14

MS. ARMSTRONG: You're asking the standards, 15

right? 16

MS. MEYERS: Right. So my issue is we have 17

to test to the new UEF beginning July 13, but I don't 18

know what value it is I have to hit until the 19

conversion factor NOPR is finalized. 20

MS. AR MSTRONG: Right. Which is why there's 21

some urgency in finalizing this rule. 22

MS. MEYERS: Correct. And if, you know, 23

comments are not due until June 15, I mean, it seems 24

to me that this July 13 date is

-- 2535

Heritage Reporting Corporation (202) 628

- 4888 MS. ARMSTRONG: Have some faith. 1

MS. MEYERS: Is, you know

-- well, okay. Is 2

not a possible date. 3

(Laughter.) 4

MS. MEYERS: I'm telling you it's not a 5

possible date because it's not just the testing, but 6

it's all the labeling and marking and everything else 7

and, you know

-- 8

MS. ARMSTRONG: So July 13 is the date for 9

the effective date test procedure right now. I mean, 10

at the very least that date has been out for a year or 11

almost a year and that is when new model testing

-- if 12

you introduce a new model on or after July 13, you 13

need to be using the UED test procedure. 14

MS. MEYERS: But the issue is I don't

-- 15

MS. ARMSTRONG: I get the downstream issues. 16

MS. MEYERS:

-- know what I have to hit. 17

MS. ARMSTRONG: So I get the downstream 18

issues, and Frank pretty much highlighted them all in 19

his opening remarks, and we understand the complex 20

position both the Department and industry are in 21

together, and there are some practical things to work 22

through. But just as a matter of what's required, 23

simply speaking, new models, if you introduce them 24

int o commerce on July 13, 2015, you need to test. 2536

Heritage Reporting Corporation (202) 628

- 4888 That is unaffected right now by anything that's in the 1

conversion factor final rule. 2

Now there are some practical issues that go 3

along that that we understand your comments and that 4

we will need to be addre ssing, but that final rule

-- 5

that date is established by statute. 6

MR. BROOKMAN: Charlie? 7

MR. ADAMS: Charlie Adams, A.O. Smith. I 8

agree with Karen on the practical issues of literature 9

and all of that, but the big practical issue is more 10

than a prac tical issue. On July 14, I have a new 11

model that I'm going to test. How do I know if I 12

comply with the new

-- 13

MS. ARMSTRONG: Right. 14

MR. ADAMS:

-- minimum standard or not 15

because I don't know what the new minimum standard is 16

unless I have a conversi on factor to convert it? 17

MS. ARMSTRONG: Understand. 18

MR. ADAMS: That's more than a downstream 19

problem I think. 20

MS. ARMSTRONG: Okay. 21

MR. ADAMS: That's I've got test data and I 22

don't know if I've passed or failed anything. 23

MR. BROOKMAN: Okay. Thanks, Charlie. 24

So this table is really important. 2537

Heritage Reporting Corporation (202) 628

- 4888 Additional comments, questions related to this table? 1

Yes, please? And say your name. 2

MR. CARNEVALE: Bruce Carnevale, Bradford 3

White. Thank you for that clarification. That helps 4

a lot, answers some of the questions that we've been 5

asking, but it seems to be contrary to some of the 6

opening statements in the summary of the NOPR where it 7

says compliance with the amended test procedure is 8

required beginning on the latter of one year after the 9

public ation of the final rule that establishes the 10

mathematical conversion factor or December 31. 11

That seems to imply that nothing with 12

respect to the test procedure takes effect until the 13

conversion factor is completed, and that seems to be 14

very much differen t from what's up here. 15

MS. ARMSTRONG: So that kicks in with the 16

bottom row here, Bruce. It has to do with the 17

transition for all models is on that last date. New 18

models, the transition is earlier. Converted models, 19

those that are allowed to use the c onversion, which 20

are existing models that have already been certified 21

to EF and thermal or standby, they are allowed what I 22

would call a one

- year transition. That one

- year 23

transition begins on the date of the final rule and 24

will end one year later. 2538

Heritage Reporting Corporation (202) 628

- 4888 MR. CARNEVALE: Okay. 1

MS. ARMSTRONG: And that transition allows 2

you to use the conversion factors until you've had a 3

time to transition to all the tests. 4

MR. CARNEVALE: Okay. 5

MS. ARMSTRONG: So, when we talk about 6

compliance in that sentence, we are ta lking about all 7

the basic models, everything bottom line

-- 8

MR. CARNEVALE: Okay. 9

MS. ARMSTRONG:

-- is when that kicks in. 10

So there's actually a couple new

-- 11

MR. CARNEVALE: So it's existing versus new. 12

MS. ARMSTRONG: So there is a distinction in 13

the way that the statutory provisions were written 14

with regards to new basic models and then existing 15

basic models. 16

MR. CARNEVALE: Okay. 17

MS. ARMSTRONG: And so that's why we kind of 18

leave this table out. This is a copy/paste from the 19

actual docume nt you're reading from, but we leave this 20

table up because in my mind this helps make clear 21

there are different buckets that you may fall into 22

depending on your requirements. Okay? 23

MR. CARNEVALE: Thank you. 24

MS. ARMSTRONG: Sure. 2539

Heritage Reporting Corporation (202) 628

- 4888 MR. BROOKMAN: Fran k Stanonik. 1

MR. STANONIK: Frank Stanonik with AHRI. So 2

just one other point, and I guess I'll state it 3

trusting we'll cover it later. All right. So, in the 4

case of this new model where I'm supposed to make my 5

representations of efficiency using the U EF metric, so 6

I'm producing those models. They're rolling out my 7

door. I still have to put a Federal Trade Commission 8

energy guide label on there. As we mentioned, at the 9

moment there's no changes in the regulations for the 10

energy guide label, so if I d on't have a conversion 11

factor, I can't convert back to put information as 12

required by the FTC labeling regulations. 13

MS. ARMSTRONG: Right. 14

MR. STANONIK: Okay. 15

MS. ARMSTRONG: DOE is working closely with 16

the Federal Trade Commission on these issues. I guess 17

I do have one just question for you though. One of 18

the things that we have I guess discussed here, and 19

perhaps I'm going to get some looks, but do you think 20

the conversion goes both ways? So can you back 21

convert if you have UEF test data to EF? Does it 22

actually go both ways? And the Department hasn't put 23

out an opinion on that for a variety of reasons, but I 24

guess a question for you guys. Do you feel like that 2540

Heritage Reporting Corporation (202) 628

- 4888 would be an interim solution for the labeling issue, 1

yet still comply with the statu tory requirements of 2

testing for UEF until there's time for which the label 3

transition can occur? 4

And perhaps you can think about it. I mean, 5

today is not going to be the day the Department is 6

going to be able to answer all your questions. We 7

will cert ainly answer those for which we can, and I 8

don't think today is the day that you're going to be 9

able to answer all of ours either, but we welcome that 10

ongoing discussion. 11

MR. STANONIK: Frank Stanonik of AHRI. 12

Certainly other members can chime in here, but I think 13

let's say in the current situation, and again, you 14

know, trying to minimize confusion I think, yes, 15

you're going to need to be able to back convert. 16

We're also on record that our preference 17

would be that in fact dates slide so that the 18

implem entation of a new label could be concurrent with 19

the implementation of the new test procedure. We'll 20

get into that later too, but I think in terms of where 21

we are today and what we're dealing

-- you know, what 22

you discussed, I think you have to have a bac k 23

conversion. 24

MR. BROOKMAN: Hampton, you're next. Why 2541

Heritage Reporting Corporation (202) 628

- 4888 don't you get up here close to the table? Step 1

forward so others can hear what you're saying. 2

MS. MEYERS: Just come take a seat at the 3

table. I think we're going to be asking a lot of 4

questions

. 5

(Laughter.) 6

MS. MEYERS: I want you right over here next 7

to me. 8

MALE VOICE: It sounded a little bit like 9

coming into the party here. 10

MR. BROOKMAN: So for those of you that 11

missed it, there's been a request that Hampton be 12

seated at the table. 13

MS. ARMSTRONG: Aren't you glad I told you 14

to show up in the morning when you asked yesterday? 15

MR. NEWSOME: And I won't be here this 16

afternoon, so that's why I raised my hand just so we 17

can talk about these. I guess if we could just dive 18

into the labe l a little bit, you know, and I have some 19

questions since I'm here and we're all here. 20

The issue with the DOE test procedure is 21

something that, you know, DOE will be working on. As 22

most of you know, the FTC rule basically says that 23

whatever goes on the label is taken from the DOE test 24

procedure, so the FTC staff generally looks at DOE as 2542

Heritage Reporting Corporation (202) 628

- 4888 to what is the test procedure and how do you comply 1

with it. 2

With all of these changes, though, kind of 3

aside from these immediate issues there's longer term 4

questions about well, should the label

-- what kind of 5

changes should we make to the label in light of the 6

new test procedure and what's going on here and issues 7

like whether there should be any additional 8

information on the label and whether the way that the 9

first

- hour rating, there are different bins for it, 10

whether that should be reflected on the label. 11

And so what I'm wondering is in addition to 12

those issues is there anything else that people are 13

expecting or would like to see on the label that FTC 14

should cons ider given that, you know, we have this 15

window, this opportunity to change the water heater 16

label? 17

MR. BROOKMAN: Karen? Please. 18

MS. MEYERS: Well, this is Karen with Rheem, 19

and I think some further clarification I need not 20

necessarily addressed to th e label, but, you know, 21

what do we do also about all the marking and consumer 22

requirements on our websites and on our sales 23

materials, how we represent the efficiency of the 24

water heater. So those are all very key questions 2543

Heritage Reporting Corporation (202) 628

- 4888 that we have because for the mo del that I have going 1

down the production line on July 13, when it gets to 2

the end of the line and I ship it out to sit on a 3

retail shelf, how do I label it and market it? 4

MR. NEWSOME: And when you say label, how 5

are you marketing it aside from the FTC label? 6

MS. MEYERS: Aside from, you know, what's 7

the yellow sticker I put on the line

-- 8

MR. NEWSOME: Right. 9

MS. MEYERS:

-- and then that unit that has 10

a production date of July 13 is sitting on a retail 11

shelf and I'm advertising it. How do I do t hat? 12

MR. NEWSOME: Right. And so

-- 13

MS. ARMSTRONG: And by production date, you 14

mean first production date of July 13 and after, not 15

an existing model that just happens to be coming down 16

the line? There is a difference. 17

MS. MEYERS: Well, there's k ind of a 18

difference in the conversion factor. I'm still not 19

sure I understand the difference in the marketing and 20

marking of that product. So I understand there's a 21

difference in that, but the new efficiency descriptor 22

of a water heater on July 13 change s, so it's now a 23

UEF whether it was introduced and tested under the EF 24

test procedure or under the UEF test procedure. So my 2544

Heritage Reporting Corporation (202) 628

- 4888 question is and what I don't know is, how do I market 1

that? How do I label it? You know, what do I display 2

on the point of sale material? What do I put on the 3

sales brochures? What do I put on my websites? What 4

do I do? 5

MR. NEWSOME: Well, there are no specific 6

requirements from FTC outside the energy guide label 7

for what you say. I mean, the law says that any 8

energy represen tation you make needs to fairly reflect 9

the results of the DOE test procedure. Now that's 10

what the law says and that is a broad principle that 11

when we dive down into the details here is probably 12

not particularly, you know, helpful. 13

And, you know, withou t having concrete 14

examples like I want to say this and this is what I 15

get from the DOE test procedure and this is what I 16

have been saying, you know, without those details, you 17

know, it's not something that, you know, I can 18

address. It's something we'd hav e to work with DOE 19

on, you know, in terms of presenting concrete problems 20

to them as part of your comments as something that, 21

you know, we can work on and try to give guidance on. 22

As most of you know, the FTC label doesn't 23

have an efficiency rating on it , so it just has the 24

dollar figure and so that, as I understand it, that 2545

Heritage Reporting Corporation (202) 628

- 4888 process isn't changing. That gives FTC an opportunity 1

to change the label all at once so we can update the 2

ranges if they need to be updated, provide additional 3

information on the la bel if that needs to be done, and 4

that can all be done at once. 5

As to your advertising representations, from 6

the FTC perspective, generally, you know, we look, 7

outside of the label, we look to see whether the 8

claims are deceptive or not, and that gets in to, you 9

know, what FTC generally does is just dealing with 10

deceptive advertising and that's always a very fact

11

specific thing. 12

So, in terms of the kinds of things that you 13

want to say in your advertising, in your website, in 14

stores, I think that that's s omething that you'll have 15

to just look at from a case

- by

- case basis and raise it 16

with DOE and FTC. 17

MR. BROOKMAN: This seems to be

-- Karen, 18

are you finished with this? Other people want to 19

chime in. I want to give you this chance. 20

MS. MEYERS: Sure. Come on. I'm sure I'll 21

chime back in. 22

MR. BROOKMAN: Okay. Charlie first and then 23

to Steve. 24

MR. STEPHENS: Yeah. Charlie Stephens. 2546

Heritage Reporting Corporation (202) 628

- 4888 Just to help Karen's inquiry here, the label right now 1

based on our data from where I live grossly 2

overestimates en ergy use annually because it's based 3

on the old test procedure draws of 62 point whatever 4

gallons per day. The new test procedure doesn't use 5

that same number, so for a medium

- sized tank it's like 6

55 gallons. It's a smaller amount of hot water. 7

And so, if you actually start labeling this 8

thing in any way with a UEF, that test implies a whole 9

different level of annual water use and therefore 10

annual dollars and annual kilowatt hours than what's 11

on the label today and it's more realistic based on 12

our data. It's still a little high for us, but it's 13

still much more realistic than the old numbers. 14

But what do you do on July 13 about the 15

dollars and the consumption when the conversion that's 16

being certified is based on a different amount of 17

annual hot water use? 18

MR. NEWSOME: Well, that for now, it's my 19

understanding, is not changing. I'll defer to DOE in 20

terms of the transition to the test procedure and 21

what's being required on the label, but there will be 22

a transition eventually and it'll be what we're t rying 23

to do I think is to coordinate that so that we have a 24

single time when the label changes over to reflect the 2547

Heritage Reporting Corporation (202) 628

- 4888 new test procedure. 1

MR. STEPHENS: So the same label would 2

continue? 3

MS. MEYERS: So I can continue to advertise 4

units with an EF. I kno w the EF number doesn't go on 5

the energy guide label, but it is used to describe the 6

efficiency of the water heater in your sales and 7

marketing materials. So I don't know what to do with 8

models that I produce after that. How do I describe 9

them? What do I put in catalogs? What does Home 10

Depot say on their shelves is the efficiency of that 11

water heater? 12

MS. ARMSTRONG: So I'm going to transition 13

the representations discussion into what we propose 14

that you certify to the Department, and so I think 15

that h elps at least answer parts of it from our 16

perspective, but obviously from Hampton's perspective 17

we will need to have some discussions about the label. 18

I mean, the label

-- I think that's why he's 19

trying to tee up the questions today of well, if I'm 20

comin g out with a new label to accompany the UEF 21

descriptor, is there anything else you guys want to 22

see on it? The sky is the limit. Here's your ask. 23

So he's asking you for input today. With that being 24

said, to go back to the cert provisions, but

-- 2548

Heritage Reporting Corporation (202) 628

- 4888 MALE VOICE: Thank you. 1

MS. ARMSTRONG: It's okay. I'm going to do 2

this somewhat by memory. So, Karen, my question to 3

you was if that unit coming off of your production 4

line on July 13 or July 14 or whatever date it was is 5

new or not. Is it first producti on or is it a 6

previously manufactured model that had been certified 7

using EF or standby or whatever? It matters. 8

MS. MEYERS: Okay. 9

MS. ARMSTRONG: There's a clear distinction 10

there. 11

MS. MEYERS: Okay. So I guess the question 12

to both of them then, so let's say it's not a new 13

production. It's a model that was certified under EF. 14

MS. ARMSTRONG: So right now you have EF 15

test data. You have the test data underlying your 16

certification and your ratings. You've come up with 17

your rating for EF in acco rdance with the EF test 18

procedure and sampling plan. You've already certified 19

that EF value, that it's compliant with standards, the 20

new April standards with the Department, right? You 21

have that set of information. 22

MS. MEYERS: Okay. 23

MS. ARMSTRONG: On July 13, the UEF test 24

procedure goes in for new models. Until we finish the 2549

Heritage Reporting Corporation (202) 628

- 4888 conversion factor you won't be able to convert that 1

rating, so you will continue using EF until we 2

finalize the conversion factor rulemaking and give you 3

conversion factors, in which case you need to start 4

using UEF. It's what that second bullet says, right? 5

For basic models previously certified prior to July 6

13 it's the date of publication of the conversion 7

factor rule that you transition your representations. 8

You have to

-- 9

MS. MEYERS: Okay. So help me through that 10

one more time. So I have an EF

-- 11

MS. ARMSTRONG: From EF to UEF. 12

MR. STEPHENS: To whom? 13

MS. ARMSTRONG: UEF. 14

MR. STEPHENS: No. To whom? 15

MS. ARMSTRONG: To us. 16

MR. STEPHENS: To you. 17

MS. ARMS TRONG: Now our proposal was to 18

allow certifications that have EF information as well 19

as the newly converted or tested UEF information, and 20

both of that set of information for previously 21

certified models was to come to the Department. 22

Now Karen is asking a step further. Well, 23

what about representations to the consumer, which is 24

where you're going with your question, and we stopped. 2550

Heritage Reporting Corporation (202) 628

- 4888 We haven't answered that whole question in its 1

entirety, but I think what we're telling you is you 2

have this EF test data. 3

MS. MEYERS: Right. 4

MS. ARMSTRONG: You have that information. 5

We have asked for you to submit both to the Department 6

with the intention that both would be going on our 7

website. So for a given model you would have EF, you 8

would have UEF, for models al ready distributed in 9

commerce. 10

MR. STEPHENS: Okay. 11

MS. ARMSTRONG: Can I get to the new model 12

first before we go with questions? 13

MR. BROOKMAN: Yeah. Okay. Keep going, 14

Ashley. Yeah. 15

MS. ARMSTRONG: Then, Karen, for your second 16

question, which i s a little, it gets to the practical 17

considerations that you guys raised earlier, and it's 18

UEF, right? So for new basic models introduced into 19

commerce, the test procedure hex. There is no 20

conversion applicable to them. 21

MS. MEYERS: Right. 22

MS. ARMSTR ONG: You don't have EF, you don't 23

necessarily have EF test data. You could elect to 24

have it. But you're required to use that new test 2551

Heritage Reporting Corporation (202) 628

- 4888 procedure. 1

MS. MEYERS: Right. 2

MS. ARMSTRONG: You have to have UEF test 3

data for new models beginning July, first date of 4

production, July 3 on. 5

MS. MEYERS: Right. 6

MS. ARMSTRONG: So that's where my question 7

comes in earlier about back calculating EF and is that 8

something you guys feel is reasonable to do. Does the 9

conversion go both ways? Because that would al low 10

you

-- you won't have EF test data unless we say you 11

have to test to both. And right now the conversion 12

factor doesn't do that. 13

What it does is the effective date of the 14

new test procedure is EF. Actually, it says you must 15

use the new one for new b asic models. It doesn't 16

allow you to use the old one. So you won't have EF 17

numbers necessarily to make representations of, unless 18

we do some type of other type of conversion the other 19

way for this one

- year period where, if we feel both 20

are needed, which we didn't go there. That's not what 21

the statute requires. 22

So that's where the questions. There will 23

be a one

- year transition period when you will have two 24

metrics based on two test procedures. Some will be 2552

Heritage Reporting Corporation (202) 628

- 4888 converted, some will be tested, and that's wh y it's 1

one year. It all goes away in one year. 2

MR. BROOKMAN: Charlie? 3

MALE VOICE: I'll wait for this back and 4

forth because I was going to go to a different area. 5

MR. BROOKMAN: No. That's my

-- 6

MALE VOICE: Yeah. I'll go to a different 7

area. 8

MR. BROOKMAN: That's why I was

-- that's 9

the stream that I was following. 10

Charlie? 11

MR. ADAMS: Okay. Thank you. Charlie 12

Adams, A.O. Smith. So for, make sure I understood 13

what I think I just heard

-- 14

MS. ARMSTRONG: I'm not sure what I just 15

said , so

-- 16

MR. ADAMS: Good. I don't feel so bad then. 17

So from a number or a metric certified to DOE. 18

Forget about who we, whether we label it or advertise 19

it or we talk about it, the number that we report to 20

you, there's a period of time, I think I just heard, 21

that we can report an EF on applicable units, we can 22

report a UEF by test on applicable units, and we can 23

report a thermal efficiency and standby loss on 24

applicable units. 2553

Heritage Reporting Corporation (202) 628

- 4888 MS. ARMSTRONG: A UEF by

-- 1

MS. MEYERS: Conversion. 2

MS. ARMSTRONG:

- - conversion. 3

MR. ADAMS: And we can get all of those to a 4

UEF by conversion. 5

MS. ARMSTRONG: For previously certified 6

models

-- 7

MR. ADAMS: For two of the three, the 8

previous two, the thermal efficiency standby loss and 9

the EF by test, we can conver t those to UEF with the 10

conversion factor. 11

MS. ARMSTRONG: Correct. And you can give 12

us all four metrics. Not only can you, but the 13

proposal is you must. 14

MR. ADAMS: Right. And I'm okay with that, 15

and by the way, I'm okay with converting both ways. 16

If we have a mathematically sound conversion factor, 17

there's something I learned in the third grade that 18

says we can work it both ways, so I'm okay with that. 19

So I guess the question still boils down to all the

-- 20

MS. ARMSTRONG: Correct. 21

MR. ADAMS: The real issue of the July 14 22

unit, have I complied with the minimum efficiency 23

standard

-- 24

MS. ARMSTRONG: Correct. 2554

Heritage Reporting Corporation (202) 628

- 4888 MR. ADAMS:

-- and also all the collateral 1

information, what do I

-- do I confuse the consumer 2

even more for a year by talking in terms of three 3

different metrics? That's a problem. That's one of 4

the problems that this whole thing was supposed to fix 5

in the first place. 6

MS. ARMSTRONG: So I agree, but you guys 7

also can't make your transitions overnight. So while 8

eliminating confuser

- - confuser

-- consumer confusion 9

is really important, I think it's equally as important 10

not to say you have to flip on a dime, you know, in a 11

24

- hour period. 12

MR. ADAMS: Yes. 13

MS. ARMSTRONG: So that's what that one year 14

was supposed to do. You know, a s an industry, if you 15

guys want to talk to both Hampton and DOE about how 16

you message to consumers, I mean, really that's 17

more

-- we can explain what our test procedures allow, 18

but generally speaking, what you just explained is 19

consistent with our proposal . That was what we said 20

in our proposal. 21

MR. BROOKMAN: Back to Charlie. 22

MR. STEPHENS: Charlie Stephens. I think 23

this might help clarify because right now I'm a little 24

confused. I want to read from something in your 2555

Heritage Reporting Corporation (202) 628

- 4888 proposal here. It says, manufac turers would not be 1

required to submit revised certification reports for 2

previously certified basic models until the next 3

annual certification date, May 1. 4

MS. ARMSTRONG: Correct. Yeah. 5

MR. STEPHENS: What does that have to do 6

with one year? And wha t this tells me, I mean, and 7

tell me if I'm wrong here, is that if you have an 8

existing model, you don't have to certify to DOE 9

anything on that thing

-- 10

MS. ARMSTRONG: Correct. We were trying to 11

give them time. 12

MR. STEPHENS:

-- until next May

-- 13

F EMALE VOICE: Yeah. 14

MR. STEPHENS:

-- and you don't

-- and I 15

guess that means you wouldn't have to change the 16

energy guide label either. 17

MS. ARMSTRONG: Not

-- 18

MR. STEPHENS: This is the problem. I think 19

the crux of the conversion, of the back conve rsion 20

here, is that unless Hampton changes his rules to be 21

consistent with that, then they're still stuck with 22

the idea that they have to put the FTC's correct 23

information on the energy guide label as with current 24

rules. But to me that means EF data, whic h is what 2556

Heritage Reporting Corporation (202) 628

- 4888 they can leave on certification with DOE until May 1 1

of next year, right? 2

MS. ARMSTRONG: For previously certified 3

models. 4

MR. STEPHENS: For previously certified 5

models. So it seems to me that the only thing we're 6

talking about here really is new models. And 7

Charlie's correct, there's some serious issues

-- 8

MS. ARMSTRONG: Right. 9

MR. STEPHENS:

-- with new models about 10

knowing what standard you're meeting and whether the 11

conversion factor is correct and whether the, you 12

know, all that. Then they have a problem with Mr. 13

Newsome's rules on labeling as well. So it seems to 14

me new models are only the real problem until next 15

May 1. Am I wrong about that? 16

MS. ARMSTRONG: Well, May 1, that's your 17

annual cert date, so we didn't make you rec ertify in 18

the interim. We actually just said you've got a pass 19

until May 1 of the next year even though you can 20

already translate your existing data. 21

MR. STEPHENS: That's what I read here. 22

FEMALE VOICE: Yeah. 23

MR. BROOKMAN: Yeah. We're working ou r way 24

towards

-- 2557

Heritage Reporting Corporation (202) 628

- 4888 MS. ARMSTRONG: It was done on purpose to 1

make it easier. 2

MR. BROOKMAN:

-- clarity I think. I want 3

to stay

-- are you in this same stream of content, 4

Harvey? 5

MR. SACHS: Yes. Yes. I'll

-- go ahead. 6

MR. BOR O S: No, no, no. 7

MR. BROOKMAN: To Joe then. Joe, please. 8

MR. BOR O S: Because I want to roll the tape 9

back while

-- I just need to talk while Hampton's 10

still here. 11

MR. BROOKMAN: Yeah. We won't let him 12

leave. 13

(Laughter.) 14

MR. BROOKMAN: Joe, go ahead. 15

MS. ARMSTRONG : I didn't know I was having 16

your public meeting, but I could have stayed home this 17

morning. 18

MR. BOR O S: I'm still trying to understand 19

what happens with the existing models. So effective 20

July we'll be converting from EF to UEF and making 21

representatio ns

-- so that's clear

-- on existing 22

models. 23

MALE VOICE: No. No. 24

MS. ARMSTRONG: You can. 2558

Heritage Reporting Corporation (202) 628

- 4888 MALE VOICE: You can. 1

MALE VOICE: You can. 2

MR. BOR O S: That's what the conversion 3

factors

-- 4

MALE VOICE: They're saying you don't have 5

to. 6

MR. BOR O S : You don't have to

-- 7

MS. ARMSTRONG: We're saying you'll have to 8

recertify under the program until May 1. 9

MR. BOR O S: I understand. 10

MS. ARMSTRONG: So if you want to wait until 11

May 1 to

-- 12

MR. BOR O S: I understand. However, the 13

energy guide lab el will utilize, will continue to 14

utilize, if I heard correctly, 64.3 gallons per day as 15

the basis for establishing annual operating estimates, 16

annual operating cost estimates. 17

MR. NEWSOME: Well, just to back up, the FTC 18

rules, all they say is whatever you put on the label 19

has to be generated by whatever DOE tells you to do 20

under the test procedures. So there's nothing 21

specific in the FTC rule about you've got to do it 22

this way or this, that way. It just says basically go 23

to DOE and put on the label wh at DOE tells you to put 24

on. And what DOE has been saying here is that 2559

Heritage Reporting Corporation (202) 628

- 4888 they're, you know, going to use, for the label, 1

they're going to use the old method until we can 2

convert it all at once. 3

MR. BOR O S: Right. So those models that we 4

convert will be in different bins, different draw 5

bins. 6

MS. ARMSTRONG: So can I ask you a different 7

question before you go? Are you going to elect to 8

make the conversion on July 1 just because you can, or 9

are you going to wait to do it until when you have to, 10

which is M ay 1 of the following year? 11

MR. BOR O S: That's a good question. I'm not 12

sure yet. 13

MS. ARMSTRONG: Because I think that

-- 14

MALE VOICE: I thought you said there that 15

we must transition. 16

MS. ARMSTRONG: Well, so there's nuances, 17

right? That's why y our cert date was bumped to May 1. 18

We got a little creative to help you, or we tried to. 19

MS. MEYERS: Well, you got creative to 20

confuse me. 21

(Laughter.) 22

MS. MEYERS: I hope you're helping me, but 23

I'm not there yet, so keep talking. 24

MALE VOICE: I m ight like it if I understand 2560

Heritage Reporting Corporation (202) 628

- 4888 it. 1

MR. BROOKMAN: Charlie, can you, do you want 2

to restate what you

-- say again how you thought you 3

were going to provide them some help. Ashley. I'm 4

sorry. 5

MS. ARMSTRONG: So while the statutory 6

requirements require yo u to transition beginning 7

May 1

-- 8

MS. BARHYDT: Transition is a key word 9

there. 10

MS. ARMSTRONG: Transition. The statutory 11

requirements say the UEF, the conversion factor, once 12

it's out, it starts this one

- year transition period, 13

and you must transiti on on that one year, whenever the 14

final rule comes out of this rule, right? 15

What we did was say, well, to DOE, your 16

certification is what you need to tell us what your 17

ratings are. You need to sign that statement, et 18

cetera, et cetera. All that's assoc iated with 19

certification. 20

Instead of saying you all have to certify 21

again on July 13, we said you don't need to do it 22

until your next annual cert date, which is May 1, 23

2016. Technically, you do not have to certify your 24

converted or your tested UEF value s for previously 2561

Heritage Reporting Corporation (202) 628

- 4888 certified basic models that have valid EF or thermal 1

efficiency/standby loss ratings until May 1, 2016. 2

MR. BROOKMAN: Charlie? 3

MS. ARMSTRONG: There was

-- 4

MR. STEPHENS: Yeah. Ashley, one further 5

clarification to add on to that. 6

MS. ARMSTRONG: Everyone's staring at me. 7

MR. STEPHENS: Then that means that for 8

those models you wouldn't have to do any kind of 9

conversion factor work until the period between 10

May 1 and when the conversion factor expires. 11

MS. ARMSTRONG: So, on May 1, they need to 12

send in their paperwork of the converted values. 13

MR. STEPHENS: Right. And you could do 14

converted

-- 15

MS. ARMSTRONG: But in varying that date

-- 16

MR. STEPHENS:

-- values until

-- 17

MS. ARMSTRONG:

-- excel exercise. 18

MR. STEPHENS: Right. And then it expires 19

and then you have to test. 20

MS. ARMSTRONG: The testing has to be done 21

by the one

- year mark. 22

MR. STEPHENS: By the one

- year mark. 23

MS. ARMSTRONG: Right. 24

MR. STEPHENS: Right. 2562

Heritage Reporting Corporation (202) 628

- 4888 MS. ARMSTRONG: They built in some 1

flexibil ities there, so if you decide to start making 2

-- so one

-- a question for

-- if they decide to start 3

making representations prior to the May 1 date, do 4

they need to recertify? 5

MR. BROOKMAN: And what about brand new 6

models? 7

MS. MEYERS: Let's not go th ere yet. 8

MR. BROOKMAN: We're not going there yet. 9

Okay. 10

MS. ARMSTRONG: We're just going to table 11

those. 12

MR. BROOKMAN: Okay. 13

MS. MEYERS: Let's get on the existing 14

models. So we all just came out with new models

-- 15

MS. ARMSTRONG: Right. 16

MS . MEYERS:

-- April 16. 17

MS. ARMSTRONG: Which is why this kind of 18

somewhat works. 19

MS. MEYERS: Right. So on all these models 20

that we've all done all the testing on and certified 21

under the EF, we can

-- and I don't know if I'm 22

stating this right, so

-- we can continue to use that 23

EF metric until we have to recertify on May 1. 24

I don't know what Hampton's going to let us 2563

Heritage Reporting Corporation (202) 628

- 4888 do on the labeling part, which is really, really key, 1

but we can continue to use that EF until May 1, and 2

then from May 1 'til one yea r after the final rule

-- 3

and you're shaking your head. I already got it wrong. 4

See. Okay. 5

MS. ARMSTRONG: You're going

-- well

-- 6

MALE VOICE: No. No. You got it. Yeah. 7

Finish what you're going to say. Finish what you're 8

going to say. 9

MS. ME YERS: So on May 1 you're going to 10

have to turn in a cert report and that cert report is 11

going to have to have the EF and the converted UEF

-- 12

MS. ARMSTRONG: Or tested. 13

MS. MEYERS:

-- or tested if you've already 14

completed that testing. And then one year after the 15

final rule you're going to have to have tested UEFs 16

for everything. 17

MS. ARMSTRONG: So it's not one year after 18

May. It's one year after the final rule of the 19

conversion factor. So it's more likely a couple 20

months after May. 21

MR. STEPHEN S: So for some models you might 22

have to test

-- if you don't test them before May and 23

you use the conversion factor, you will have to test 24

and then recertify them. 2564

Heritage Reporting Corporation (202) 628

- 4888 MS. ARMSTRONG: Correct. Yeah. Yeah. 1

MR. STEPHENS: Okay. 2

MS. ARMSTRONG: Yeah. Ye ah. So, if Hampton 3

says that your label needs to be based on the DOE test 4

procedure, you have ratings that are based on the DOE 5

test procedure for a while. 6

MR. BOR O S: Which would be 64.3 gallons per 7

day, right? 8

MALE VOICE: Right. Yeah. 9

MR. BOR O S: But at the same time we'll have 10

new models on the marketplace

-- 11

MS. ARMSTRONG: So the issue

-- we get the 12

new model

-- 13

MR. BOR O S: Well, let me get, let me get

-- 14

MS. ARMSTRONG:

-- we get the new model

-- 15

actually, we're talking about existing m odels because 16

we just decided that you guys have introduced all your 17

new models before April 15. 18

MR. BOR O S: Right. The point that I was 19

trying to make is that we will have new models on the 20

marketplace and there will be representations made 21

with UEF th at will have been tested at different daily 22

hot water use. So

-- 23

MR. SACHS: There will be a bias. 24

MR. BOR O S: Yes. So the consumers will be 2565

Heritage Reporting Corporation (202) 628

- 4888 confused whether this EF or UEF is based on 64.3 1

gallons or 55 or 84. So, in my opinion, that creates 2

a rea l problem in terms of what we present to the 3

consumers. 4

MALE VOICE: Yeah. And I think that's a

-- 5

MR. BROOKMAN: So thank you, Joe. Now 6

Hampton. If we could please start saying our names. 7

Hampton? 8

MR. NEWSOME: Hampton Newsome. And I 9

should

-- I

-- as always, I'm speaking as a member of 10

the FTC staff and not for the Commission, so, you 11

know, I always try to say that. So the, you know, the 12

question about

-- so the question here is about 13

representations. And from FTC's perspective, 14

basically, yo u know, we talked about earlier that 15

there's this very general statement in the law that 16

you have to

-- your representations have to reflect 17

the results of the DOE test procedure. Well, here DOE 18

test procedure has all these different metrics. 19

When the F TC staff has addressed these types 20

of questions in other contexts, you know, there's a 21

recognition that sometimes the advertising will 22

involve information that is maybe not the specific 23

metric on the FTC label or the specific metric that's 24

certified to DOE to meet the standards. Sometimes 2566

Heritage Reporting Corporation (202) 628

- 4888 there may be information that, you know, is unrelated 1

to the test procedure but is still vaguely related to 2

energy. 3

And so the bottom line for the FTC staff is 4

to look and see whether the

-- and there's no

-- once 5

you'r e outside of

-- once you meet the requirement of 6

representing the results of the DOE test, you know, 7

whatever that basic metric is, and you've got other 8

metrics or you're concerned that that metric may be 9

confusing because you've been using another metric, 10

what we're looking at is whether the representation is 11

deceptive to consumers. 12

And so, if you have a situation like this, 13

what you want to be considering is whether there, on 14

your website or wherever you're doing this 15

advertising, whether you need to pr ovide disclosures, 16

additional information, to make it clear to people 17

that, you know, this number, you know, means X and, 18

you know, if you provide another number, this number 19

means Y, and do it in a way so that people aren't 20

confused. 21

Now, you know, I'm just an attorney and so 22

all of this stuff is fairly technical and so I'm not 23

saying it will be easy to do, but that is the basic 24

way that we would approach these types of issues. 2567

Heritage Reporting Corporation (202) 628

- 4888 MR. BROOKMAN: Russell? 1

MS. ARMSTRONG: I mean

-- 2

MR. BROOKMAN: Go ahe ad, Ashley. 3

MS. ARMSTRONG: Can I just say one thing 4

real quick? 5

MR. BROOKMAN: Go ahead. 6

MS. ARMSTRONG: You're going to have this 7

transition situation anyway, right? You're going to 8

have a period of time, whether it's that full year or 9

whether you do it from the May to the, you know, one

10

year expiration date, which is going to be a couple 11

months, you're going to have a period of time for 12

which UEF and EF exist in the market. 13

We've gone through this a number of times 14

with a number of products now that we're starting to 15

overhaul test procedures and metrics. There has been 16

some desire to have some time for manufacturers to 17

transition their ratings, their test data, their 18

literature, their marketing, albeit maybe a limited 19

amount of time to not cause too much consumer 20

confusion. But I will say, you know, that has 21

happened. We have successfully kind of gone through 22

it before, you know. 23

We will also put an explanation on our 24

website, on our database, in terms of what these 2568

Heritage Reporting Corporation (202) 628

- 4888 different metrics mean, ho w they're not comparable, 1

blah, blah, blah, and that kind of stuff as well. 2

MR. NEWSOME: Yeah. And it's not a unusual 3

problem. 4

MS. ARMSTRONG: Right. 5

MR. NEWSOME: It comes up in a lot of

-- 6

MS. ARMSTRONG: Exactly. 7

MR. NEWSOME:

-- product cat egories. There 8

are conversions all the time. These guys are changing 9

test procedures or standards on a, you know, kind of 10

schedule and so we have these transitions not only 11

with the label but with representations. And as 12

Ashley's saying, you know, what you try to do is kind 13

of minimize this transition. 14

And the manufacturers, if they're concerned 15

that, well, this representation I'm making is 16

deceptive, then you want to consider providing 17

disclosures to help that, and you can certainly reach 18

out to me an d to DOE and we can talk about, you know, 19

the specific problems that you're having. 20

MR. BROOKMAN: I want to make sure we get as 21

much clarity and closeout on this stream of content as 22

possible. Are you

-- 23

MR. PATE: I'm speaking to this stream, yes. 24

MR. BROOKMAN: Go ahead, Russell. 2569

Heritage Reporting Corporation (202) 628

- 4888 MR. PATE: Yeah. Well, adding to your 1

point, say FTC looks for things to not be deceptive: 2

the literature, the marketing, the labeling. I 3

believe there's an argument to be made after July 13 4

that the energy guide lab el in place at that time can 5

potentially be deceptive, because if you're trying to 6

back convert existing models now to an EF to calculate 7

annual costs, they were tested to a different 8

procedure, drawing higher amounts of water potentially 9

for a similar siz ed water heater that's a new model 10

after July 13, tested to the new procedure, so your 11

annual energy consumption costs potentially will be 12

lower for a similar model with a similar EF. 13

And so you're telling the consumer this 14

costs a less amount of money t o operate, but it's 15

really an apples and oranges comparison at that point 16

in time. 17

MS. ARMSTRONG: So you'd never back convert 18

existing models, though. You'd already have that EF 19

data. 20

MR. BROOKMAN: Frank, go ahead. 21

MS. ARMSTRONG: The issue would be with

-- 22

MR. PATE: Right, but it's tested under a 23

different procedure, with different draw patterns. 24

MALE VOICE: Different daily hot water use. 2570

Heritage Reporting Corporation (202) 628

- 4888 MS. ARMSTRONG: So I guess I'm not, you 1

know, I guess I'm not following because, in my 2

opinion, EF rea dings as they are generated and even 3

converted EF readings should be represented above the 4

EF test procedure, which has the same amount of

-- you 5

know, if the back conversion is valid, that's what 6

that means. It's representative of that test 7

procedure. T here's no confusion there. EF ratings 8

mean one thing and that's what

-- you know, the test 9

procedure specifies that gallons per day, et cetera, 10

et cetera. 11

Now that being said, UEF ratings means 12

something different, and whether they're tested or 13

converte d, they all mean the same thing, at least 14

generally representative of that test procedure. By 15

statute, that's what's required. 16

FEMALE VOICE: So, Ashley

-- 17

MR. BOR O S: Well, let me

-- 18

FEMALE VOICE: Go ahead. 19

MR. BOR O S: Can I just jump in? 20

MR . BROOKMAN: Joe. 21

MR. BOR O S: I think the point there is that 22

you could have two water heaters on the market at the 23

same time, both

-- let's just use two 50

- gallon 24

electric water heaters. One has an EF base value, the 2571

Heritage Reporting Corporation (202) 628

- 4888 other one has a UEF base value. O ne's tested with 1

let's say 55 gallons per day, the other one's tested 2

with 64 gallons per day. And let's assume they have 3

similar, you know, EF outcomes. They're going to have 4

different estimated annual operating costs. They'll 5

be on the market, on the shelf beside each other that 6

will have different operating costs. How is the 7

consumer supposed to make a selection between those 8

two? 9

MS. ARMSTRONG: So your point

-- I think the 10

point you're trying to make is if

-- I think what 11

you're trying to ask Ham pton, and I'm going to 12

translate this and see if I got it right, is, Hampton, 13

for models that DOE says have to be tested pursuant to 14

the UEF test procedure, can they apply the EF label if 15

DOE provides a way to convert the UEF test data to the 16

EF values suc h that you get annual energy costs that 17

are representative of the EF methodology? I think 18

that's what they're asking. 19

MS. MEYERS: Well, this is Karen with Rheem 20

and I have another question. So

-- 21

MR. BROOKMAN: Well, maybe Charlie could

-- 22

MS. ARM STRONG: I don't think you want to 23

answer that. 24

MR. NEWSOME: Well, I mean, the basic 2572

Heritage Reporting Corporation (202) 628

- 4888 question is whether the DOE test procedure is 1

representative and what they're trying to do during 2

this transition, which is incredibly complicated, 3

whether that's adequ ate or not. And so it's really a 4

question about whether the DOE test is representative, 5

and so I think Ashley

-- 6

MR. BROOKMAN: I want to make sure we try to 7

respond to Ashley's restatement. Maybe either Charlie 8

or Frank or this Charlie could

-- you wa nt to start, 9

Charlie? 10

MS. ARMSTRONG: So, Joe, to say it another 11

way, if I were to provide you a back calculation of EF 12

from UEF test data, back calculated EF, which in 13

theory should take care of the differences between the 14

two test procedure, and then I said your label has to 15

be based on the annual costs that you would derive 16

from that EF value, do you have an issue? 17

MR. BOR O S: Well, yeah, I guess we have a 18

couple of issues, but the first issue

-- and I think 19

Frank Stanonik already p resented our lack of 20

confidence with how, you know, the

-- 21

MS. ARMSTRONG: So that's a different issue, 22

right? 23

MR. BOR O S: Right. So

-- 24

MS. ARMSTRONG: That's a technical issue. 2573

Heritage Reporting Corporation (202) 628

- 4888 But fundamentally, as a process issue, your answer 1

should be no. I mean, to the extent you believe in 2

the conversion

-- and at the end of the day we all 3

believe in the technical aspects of the conversion

-- 4

your answer has to be no. That's what the conversion 5

is supposed to be. 6

MR. BROOKMAN: Karen? 7

MR. BOR O S: Understood. 8

MS. ARMSTRO NG: So do you agree with me? 9

MS. MEYERS: To convert a model and label it 10

correctly you could only convert it to a high bin 11

model, right? Because the label would be based upon 12

64 gallons. 13

MS. ARMSTRONG: Not necessarily. 14

MR. BROOKMAN: Charlie? 15

M ALE VOICE: Charlie Adams has been waiting 16

for a while, so

-- 17

MR. BROOKMAN: Harvey, thanks for being 18

patient. 19

Charlie? 20

MR. ADAMS: Thank you. Charlie Adams, A.O. 21

Smith. Let me restate what I think I hear Joe's 22

problem to be. If I have a model tha t I have in

-- 23

that I've

-- that I've put in production and put in 24

the marketplace July 1, so I'm ahead of the 13th 2574

Heritage Reporting Corporation (202) 628

- 4888 cutoff

-- 1

MS. ARMSTRONG: Yep. 2

MR. ADAMS:

-- it has an EF test method that 3

has a dollar amount, dollar operation developed in 4

terms of the 64

- gallon EF test method

-- 5

MR. BOR O S: On the label. 6

MR. ADAMS:

-- on the label, I have

-- I 7

didn't do it on July 1, I did it on August 1, exact 8

same hardware, okay, I have to use the UEF test method 9

and it falls under the 55

- gallon bin, it uses less 10

energy and therefore costs less money to heat 64 11

gallons a day than it does 55 gallons a day. 12

MS. ARMSTRONG: Yes. 13

MR. ADAMS: So the model that I had on the 14

market July 1 has a dollar amount of operation 15

calculated by the appropriate methods here on the 16

label. Its exact twin, it's a month younger, that was 17

tested by the UEF test method at 55 gallons, converted 18

backwards to get the EF so I can do the calculation, 19

has a lesser dollar amount. One of those is deceptive 20

to the consumer I think is wha t Joe said. 21

MR. BOR O S: Yes. That was my point. 22

MS. ARMSTRONG: But I think what I'm trying 23

to say is that if DOE provides you

-- and we haven't 24

got there yet. We haven't had those discussions. But 2575

Heritage Reporting Corporation (202) 628

- 4888 what I think I'm hearing you ask for is, you know, 1

what goes on the label, the dollar calculation, is 2

part of the DOE regs, it's not part of Hampton's regs, 3

so what you're really asking for is

-- and that's why 4

I asked at the outset about my back conversion 5

question, because if we provide you a method of b ack 6

conversion your ask would be also to provide you a 7

method of dollar amount that would be comparable to an 8

EF rating. So, in other words, you wouldn't be using 9

the 55 gallons. 10

If you're going to

-- if we're going to 11

allow the back conversion, we woul d make everything 12

comparable. That multiplier would have to be 13

consistent with the EF test procedure. You wouldn't 14

just pull the new multiplier from the UEF procedure. 15

Everything would have to line up. But, in theory, it 16

all hinges upon being able to c onvert properly. 17

MR. BROOKMAN: Frank? 18

MR. STANONIK: Frank Stanonik with AHRI. 19

Two things. First of all, I mean, we've been 20

discussing how you calculate your cost of operation on 21

the label, okay? And Hampton pointed out the 22

regulations simply say y ou use the DOE test procedure, 23

but the FTC regulations do specifically identify the 24

ranges of comparability you use, and those are based 2576

Heritage Reporting Corporation (202) 628

- 4888 on the first

- hour rating of the

-- 1

MS. ARMSTRONG: The current. 2

MR. STANONIK:

-- current test procedure, 3

okay? Th e UED test procedure absolutely blows up the 4

ranges of comparability because we now have products 5

and we tested the different water draws depending on 6

what bin they fall in, and so that becomes a critical 7

change. And so the idea that you could simply use the 8

existing label and just manipulate your cost of 9

operation is a half a step that doesn't solve the 10

issue. 11

So, to Ashley's point, it is absolutely 12

critical if the

-- the labels at the moment are not 13

going to change. The rules haven't changed yet. So 14

it's absolutely critical there would be a back 15

conversion. 16

And the thing to keep in mind is, okay, all 17

the conversion factors are taking water heaters that 18

have been tested to 64.3 gallons a day and converting 19

it to whatever bin it fits in. And it's abs olutely 20

critical. We all want the correct conversion factor. 21

MS. ARMSTRONG: Right. 22

MR. STANONIK: But if you have the correct 23

conversion factor, the back calculation should work to 24

take a product that maybe was tested in the medium bin 2577

Heritage Reporting Corporation (202) 628

- 4888 and calculate, estimate its cost of operation as if it 1

was still doing 64.3 gallons. 2

MS. ARMSTRONG: Exactly. 3

MR. STANONIK: It should all work. 4

MALE VOICE: It should. 5

MR. STANONIK: One other point to remember 6

that, again, it's just another factor. We keep 7

ta lking about less gallons. It's less gallons of 8

cooler water. The new test is 125 degree water, the 9

old test is 135 degree. Nominal tank temperature 135. 10

So not only is it less water, it's water with less 11

energy it. So there's no question, again, once we get 12

the thing running, that certainly products in the low 13

and medium usage bin are going to have lower costs of 14

operation even though it looks exactly like that water 15

heater that just rolled out your door today. 16

MR. BROOKMAN: So we're not worried abo ut 17

deceiving the consumer here. 18

MR. SACHS: I'd like to build on the last 19

couple remarks with an outrageous suggestion, which is 20

uncommon for me. The first thing that occurs to me is 21

that we really do have a qualitative change, that the 22

absolute essenti al for Hampton's new label, the 2016 23

label let's call it, is that it clearly identify for 24

the customer that this rating is based on the usage 2578

Heritage Reporting Corporation (202) 628

- 4888 class: very small, small, large, medium and large. 1

It's a very different label then. And I 2

wonder if the way t o resolve some of this, and it 3

would probably have to be combined with some slippage 4

in the effective dates, is to simply continue to use 5

the old label for EFs with one note added which says 6

this label goes away, if a new labeled product is 7

available, it w ill give you a better estimate of your 8

operating cost, and the new labels then are UEF

- based. 9

Now I haven't completely thought out of 10

this, this out, but I think it is a transition here, 11

and accepting that and accepting that there's a lesser 12

label and a better label would wind up lining 13

incentives so manufacturers want to transition more 14

quickly rather than less quickly even though they 15

probably would want to delay a couple of product 16

introductions from July 12 to July 15. 17

MR. BROOKMAN: Frank? 18

MR. ST ANONIK: This is Frank Stanonik, AHRI. 19

I just want to mention, following up on what Harvey 20

just said, we in fact have went ahead and drafted what 21

we think would be a recommendation for an improved 22

label and a critical

-- Hampton asked this question 23

what d o we think needs to be added. 24

The two things we think would be necessary 2579

Heritage Reporting Corporation (202) 628

- 4888 on this new label is, first of all, you would only 1

compare models in the same bin, and there would be 2

information on the label that clearly tells the 3

consumer essentially that fact, that, you know, there 4

are

-- A) that you only should look at models in this 5

bin, and there are other bins, but you need to look at 6

the one. 7

So, I mean, it's at this point a 8

recommendation, and hopefully, as things go on here 9

and the label does get chang ed, most of it will be 10

implemented. 11

MR. SACHS: This is Harvey. Following up, 12

I'm certainly not a human behaviors expert, human 13

factors expert by any means, but it seems to me that 14

somewhere on that label we have to have a little bit 15

of guidance that sa ys medium is designed for consumers 16

who have X number of people in the household or 17

something like that. There has to be a short phrase 18

either on that specific bin or on all of them as sort 19

of a graph. But end of the comment. 20

MR. NEWSOME: Well, yeah. And I guess 21

that

-- and so I appreciate those comments because 22

they're very helpful because one of

-- I mean, aside 23

from all these transition, very difficult transition 24

issues, you know, one thing that this possibly does is 2580

Heritage Reporting Corporation (202) 628

- 4888 give an opportunity to improve the label. 1

For decades the main

-- for storage water 2

heaters, the main disclosure has been first

- hour 3

rating, and to my knowledge, that term has never been 4

comp tested. We don't really know how consumers 5

interpret that. It's presented in gallons. Most of 6

these products are marketed in terms of gallons in 7

terms of their storage capacity. 8

So by having these bins with these kind of 9

qualitative names, does this provide an opportunity to 10

make the label clearer and better for consumers, and 11

what's the best way to organize this. 12

MR. BROOKMAN: Charlie Stephens? 13

MR. STEPHENS: Yeah, I can speak a little 14

bit to that because we dabble in this area. The 15

first

- hour rating was always, up until now, based on 16

the EF test with a average tank temperature of 135 17

d egrees, which isn't actually how water heaters are 18

delivered to the store. They're delivered with the 19

set point at 120 typically, and typical delivered 20

water temperature is about 125. 21

So the first

- hour rating that's on the label 22

based on 135 degree aver age tank temperature actually 23

isn't the first

- hour rating of the product that's on 24

the shelf as it's delivered with its set point. 2581

Heritage Reporting Corporation (202) 628

- 4888 That's the way it is today. 1

However, our codes, our plumbing codes 2

actually rely on those first

- hour ratings. That's how 3

you size a water heater for a house with so many 4

bedrooms. You know, if you have a house with five 5

bedrooms, you can't put a water heater in there with a 6

60

- gallon first

- hour rating. The plumbing code 7

actually uses those numbers. 8

So it's actually more important than most 9

people realize that those numbers be reasonably 10

accurate because we're sizing water heaters for houses 11

by law in many states using them. So we really should 12

try to be better at that, and I think the new test 13

procedure does actually get at that better. 14

MR. BROOKMAN: Charlie, follow on? 15

In a little bit we're going to move on, 16

folks, just so you know. Charlie? 17

MR. ADAMS: Follow on to Hampton's comment. 18

Water heaters are sold on first hour because that's 19

how we size them, that's h ow we know what to put in. 20

We've got a 50

- gallon water heater that fires at 21

100,000 BTUs, it provides beaucoup hot water. If you 22

want one at 75,000 BTUs or at 50,000, 40,000 BTUs, you 23

need a bigger size tank. So we do not sell on you 24

need a 50

- gallon wa ter heater. It's I've got a 50

- 2582

Heritage Reporting Corporation (202) 628

- 4888 gallon water heater that delivers the amount of water 1

you need. So we sell on first hour. 2

MR. NEWSOME: Yeah, but isn't it true if you 3

go online to a big box store or something and you look 4

at water heaters one of the pri mary descriptors is the 5

size of the water heater, right? 6

MR. ADAMS: It's a descriptor, but there's 7

also sizing guides on how you put in

-- 8

MR. NEWSOME: Yeah. Yeah. 9

MR. ADAMS:

-- how many people and how many 10

bathrooms and it will tell you which on e of those to 11

go get. 12

MR. NEWSOME: My question is whether having 13

those two metrics, which are both in gallons, whether 14

that's confusing to people and whether there's a way 15

to improve the label to communicate that. 16

MR. ADAMS: There's 40 ways to

-- the re's a 17

lot of ways to improve the label, but don't lose first 18

hour because that's the important number. The storage 19

volume is not. Otherwise, tankless water heaters 20

would make no sense. 21

MR. NEWSOME: So, and both of these comments 22

and then, you know, w e can stop talking about label. 23

So what you're saying is even if we go with the DOE 24

bins, the label somewhere should have the specific 2583

Heritage Reporting Corporation (202) 628

- 4888 number for first

- hour rating because it's important to 1

list. 2

MR. ADAMS: Yes. 3

MR. BROOKMAN: Okay. Hampton, noting that 4

you're not going to be with us in the afternoon, is 5

there anything else you wish to try and clarify now? 6

MR. NEWSOME: I feel like I've had a full 7

plate this morning. 8

(Laughter.) 9

MR. BROOKMAN: I want to finish this out, 10

Steve. I haven't heard from you yet. Go ahead. 11

MR. YORK: And I don't want to talk about 12

the label, but I do want to talk about representation. 13

James York from Rinnai. 14

You stated when we were talking about this 15

conversion factor and representations, you said

-- and 16

the way that we interpret it or way I interpret it, 17

when it says must transition, means that the date that 18

it becomes effective we must transition all of our 19

representations, and your comment back was if you 20

choose to. 21

So is it the department's thought that eac h 22

manufacturer can choose to transition somewhere 23

between the effective date and the one

- year twilight 24

of it and we can all do it at different times and so 2584

Heritage Reporting Corporation (202) 628

- 4888 that I may have products immediately out there in UEF 1

because maybe I think it's a great metric and Charlie 2

comes in three months later and Karen comes in nine 3

months later and Alex is always late, so he comes in 4

at the one year point? Because now the market's 5

confused. I mean, that's one of our big things. And 6

so, I mean, that's our question about re presentation. 7

I know you say you haven't addressed it, but you 8

implied that it was a choice. 9

MS. ARMSTRONG: So this is Ashley from DOE. 10

I'm going to choose my words carefully here. What we 11

did propose was that you're not required to recertify 12

until M ay 1. That gives you some flexibility I think. 13

We were doing it because we thought we were helping 14

you. I think that was our intent, you know, when we 15

looked at the different options and what the statutory 16

requirements are. 17

However, if you believe tha t it will cause 18

more market confusion and more harm than good and you 19

shouldn't be doing something differently than Charlie, 20

and since Alex is going to be behind anyway according 21

to you, you know, we don't have to worry about him, 22

but if you believe everyo ne should be transitioning on 23

a date all at the same time and that date should be 24

July 1, that's what the proposal is for: comment. 2585

Heritage Reporting Corporation (202) 628

- 4888 You know, our perhaps misconception here was 1

that by allowing you some leeway until the May 1 2

annual cert date, that that would help you. 3

MR. BROOKMAN: Charlie? 4

MR. STEPHENS: I'll just add one thing I was 5

going to say earlier, and I think this always happens 6

when you have this kind of a discontinuity in test 7

procedures. The problem here is the length of time 8

during wh ich it can occur, and that grace period, if 9

you will, or that flexibility period until May is one 10

of the things that's causing that. But, you know, is 11

that more important than the confusion in the 12

marketplace? 13

One of the things that I think is, we'll ge t 14

to this afternoon I hope, is that unless we can get 15

the conversions right, which I have my doubts about 16

unless we can straighten out a couple of things, then 17

I would almost rather that we wait as long as possible 18

for the conversion and then everybody con vert at once 19

with the right numbers, which in my mind would 20

probably be tested numbers, or closer to a period when 21

we all get tested numbers that get certified and get 22

on the label and everything else. 23

I'd rather be using the old labels until we 24

can actu ally get numbers that don't rely on a 2586

Heritage Reporting Corporation (202) 628

- 4888 conversion factor at this point, unless I get a lot 1

more confidence in the conversion factor. 2

MR. BROOKMAN: Charlie, go ahead. 3

MR. ADAMS: One comment on the conversion 4

factor and testing versus conversion. Let's not lose 5

sight that if we delayed long enough that everybody 6

had time to test everything, there's still a very 7

significant conversion factor impact because the 8

conversion factor is what translates the EF minimum 9

standards into UEF minimum standards, so

-- 10

MR. STEPHENS: Yeah. I know. 11

MR. ADAMS:

-- that never goes away. 12

MR. BROOKMAN: Going back to Frank's earlier 13

comments, Steve Rosenstock, you've been so patient. 14

I've never seen such patience from you. 15

MR. ROSENSTOCK: And you may not again. 16

(Laughter.) 17

MR. BROOKMAN: Thank you very much for that. 18

MR. ROSENSTOCK: Doug, thank you, I think. 19

I'm looking

-- I'm on a different stream here for 20

products that are using uniform energy factors, 21

thinking about the label in the future, new models 22

us ing just the energy factors. From now on they're 23

going to have four efficiency values based on the draw 24

pattern. There's four uniform energy factors for 2587

Heritage Reporting Corporation (202) 628

- 4888 every storage water heater in the future. What? 1

MALE VOICE: Not here, no. 2

MR. ROSENSTOCK: Acco rding to this, yes. 3

Hold on. Hold on. Therefore, if you're thinking 4

about, you know, the label, it's both, you know, right 5

now you're showing an operating cost range. I'm just 6

thinking, well, you know, do you help the consumers 7

with different draw patt erns by showing four cost 8

ranges, or do you just show the one cost range and 9

then based on one draw pattern? I mean, I'm just 10

thinking about this because if it says the FTC has to 11

be based on the DOE test procedure and the DOE test 12

procedure shows all the se ranges, is FTC required to 13

show all the values or just they can pick and choose. 14

Again, I'm just thinking about this, you know, in the 15

future for possible consumers looking at those future 16

water heaters with the UEF label. Again, I'm just

-- 17

MR. BRO OKMAN: Yeah. Frank? 18

MR. STANONIK: Frank Stanonik, AHRI. But, 19

Steve, depending what bin the model falls in, only one 20

standard applies. 21

MALE VOICE: Only one standard and one draw 22

pattern. 23

MR. ROSENSTOCK: Right. 24

MR. STANONIK: Yeah. 2588

Heritage Reporting Corporation (202) 628

- 4888 MR. ROSENS TOCK: Right. But how do you

-- 1

but okay, if I'm going into that hardware store for 2

myself or let's say I'm buying it for my friends or 3

whatever and we have two bins and we say, well

-- 4

again, it's a matter of how

-- 5

MALE VOICE: How big is your family. 6

MR. ROSENSTOCK: Well, again

-- 7

MR. STANONIK: I mean, this, you know

-- 8

MS. ARMSTRONG: That's not an issue for the 9

standards, though. 10

MR. STANONIK: Well, it's

-- 11

MR. ROSENSTOCK: It's not an issue for the 12

standard, no question about it, again , but Hampton is 13

here and I'm just trying to think down the road 14

that

-- 15

MR. NEWSOME: Well, that's the question 16

that's, that, you know, we're talking about in terms 17

of how do you communicate that on the label. How do 18

we change the label to communicate these bins and what 19

they mean and what these terms mean? 20

MR. ROSENSTOCK: I mean, my thought, and I 21

submitted this to DOE, was, well, to make it easy for 22

everybody, just stick with the medium draw pattern to 23

kind of be somewhat analogous, but if that's n ot 24

possible, then, you know, again, I think there will be 2589

Heritage Reporting Corporation (202) 628

- 4888 confusion if different water heaters have different 1

ranges based on different draw patterns. 2

MR. BROOKMAN: So Frank, and then to this 3

gentleman here. 4

MR. STANONIK: Frank Stanonik, AHRI. But, 5

Steve, but really the fundamental principle for the 6

water heater industry always has been if this is going 7

to be done properly, the consumer first should figure 8

out what size water heater they need, and then you go 9

look for the products that can satisfy yo ur need and 10

not go the other way and say, well, what's the biggest 11

one or what has the lowest cost of operation or 12

whatever. 13

I mean, from the very beginning we've always 14

taken the approach, okay, look, you need to figure out 15

what size you need and then, once you know that, go 16

look at what efficiency level you want to get for the 17

product you need. That hasn't changed. This, if we 18

get this all right, this may help that. 19

MR. BROOKMAN: Yeah. Yes? 20

MR. CARNEVALE: I think this

-- Bruce 21

Carnevale, Bradfo rd White. I think, to address 22

Steve's concern about confusion, during the comment 23

period on the test procedure I think there was 24

unanimity amongst the manufacturers that there should 2590

Heritage Reporting Corporation (202) 628

- 4888 be some distinction for the UEF, what it is called, 1

with respect to what bin it goes into, because right 2

now, to your point, there is a little bit of 3

confusion. You have the same terminology for products 4

that could be in different bins. What AHRI has 5

proposed is to put that range of comparability so that 6

you're only comparin g products in the same bin, which 7

is determined by the first

- hour rating or the GPM if 8

it's a tankless. So that takes away some of the 9

confusion. 10

But I would still argue that it would be 11

helpful to have some distinction so that it's more 12

prominent for t he consumer, that they can see, well, 13

this is a little bit different than this because it's 14

a different draw bin. 15

MALE VOICE: Thank you. Yes. Thanks. 16

MR. BROOKMAN: Joe? 17

MR. BOR O S: Just a quick comment. I believe 18

AHRI developed a proposal that w as shared. Frank, 19

maybe

-- 20

MR. STANONIK: I meant to. Yeah. 21

MALE VOICE: Yeah. 22

MR. STANONIK: Okay. Yeah. 23

FEMALE VOICE: Have we sent it to Hampton? 24

MR. STANONIK: Yes. Yeah. I'll send it to 2591

Heritage Reporting Corporation (202) 628

- 4888 Charlie. I'll send it to Harvey too. 1

MR. BROOKM AN: Okay. Okay. So I thought we 2

worked our way through a lot of useful stuff there. 3

Amy, please. 4

MS. SHEPHERD: Yeah. I just

-- this is Amy 5

Shepherd of AHRI. Just one closeout. If based on 6

comments DOE comes to a conclusion of some path 7

forward w here, you know, the certification's not until 8

May, so the inference is that the representations 9

might not be until May, I think what's important is 10

that manufacturers have some certainty in terms of the 11

enforcement. 12

So, if there is a decision that there will 13

be an allowance for the EF to be used during that 14

period, I think that we need something that says that 15

from FTC, which is charged with that piece of the 16

enforcement in DOE, that it's okay to go forward in 17

that way, because I think that's part of the problem 18

is that there's a lot of uncertainty about this issue. 19

So if we, once we decide what the path 20

forward is, could have some very explicit guidance in 21

terms of what the enforceability would be would be 22

helpful. 23

MR. BROOKMAN: Okay. Are we ready t o move 24

on now? Yes. Let's move on. And we're going to hear 2592

Heritage Reporting Corporation (202) 628

- 4888 from Bill Healy, National Institute of Standards and 1

Technology. And for those of you that are curious, 2

we're probably going to work inside say until 12:30 or 3

so and then see where we are based on the content. 4

And, Frank, you've got quite a few 5

additional slides, correct? 6

MS. ARMSTRONG: Six. 7

MR. STANONIK: Six, yeah. I mean, again, we 8

can kind of

-- I think that Ashley said maybe hold 9

them until near the end or

-- 10

MS. ARMSTRONG: So I would just say this is 11

a good question for you all just in terms of schedule

12

wise. It is noon or close to it. We can keep going. 13

We don't have a whole lot of slides in terms of

-- I 14

mean, we're going to talk briefly about what we said 15

and show some tabl es and show some equations. We can 16

at least give our portion of the presentation. I 17

don't know if you want to break for lunch or if you 18

just want to keep going, plowing through and hold 19

lunch. We can do whatever you guys like. There's no 20

opinion. 21

MR. BROOKMAN: Yeah. That was my thought. 22

DOE's

-- if you look at the slide packet here, there's 23

very useful information here, but it's not a really 24

thick deck. So I was thinking we'd go through this 2593

Heritage Reporting Corporation (202) 628

- 4888 and then we assess where we are at that point, okay? 1

S o, Bill, go ahead. 2

MS. ARMSTRONG: I mean, minus the technical 3

differences that we're going to speak of with regards 4

to the six slides you have in terms of what you guys 5

want us to look at, I think the majority of the 6

discussion in terms of the controver sial what we have 7

to do when has been had. 8

MALE VOICE: I wonder if we could take a 9

five

- or 10

- minute break. 10

MS. ARMSTRONG: Sure. Absolutely. 11

MR. BROOKMAN: A 10

- minute break now? Okay, 12

let's take a 10

- minute break. Just so you're

-- the 13

restroo ms are out near the elevator core. And the 14

door over here is open for when you want to reenter. 15

And there's a water fountain right over here, outside 16

the door over here to the right

- hand side on this 17

corner over here if you want to grab some water, okay? 18

So 10 minutes and then we'll resume. 19

(Whereupon, a short recess was taken.) 20

MR. BROOKMAN: We're about to resume. And 21

we're going to hear from Bill Healy, NIST. There 22

ought to be a microphone there, right? 23

MR. HEALY: Yeah. It's covered up, so

- - 24

MR. BROOKMAN: Are we all set, ready to go? 2594

Heritage Reporting Corporation (202) 628

- 4888 MR. HEALY: Yeah. 1

MR. BROOKMAN: So do you have the advance 2

thing? 3

MR. HEALY: I'll just use the arrow key. 4

MR. BROOKMAN: Okay. 5

MR. HEALY: Okay. So we're going to talk 6

about the getting more dept h on the technical aspects 7

of the conversion factors. I will start out with 8

talking about the models that DOE tested and what 9

considerations there were for selecting these. 10

In selecting these units, we based it on a 11

lot of the comments we received at RF Is and the final 12

rules of the test procedure. So these are the 13

issue

-- these are the properties considerations for 14

test selection. 15

So one was the NOx emissions. It was 16

pointed out we should look at standard low or ultra 17

low, venting type for gas, atmo spheric or power vent, 18

short or tall units, whether a gas unit has a standing 19

pilot or whether it has no standing pilot, and also 20

whether there's a condensing unit or a non

- condensing 21

unit. 22

We also attempted to test a range of models 23

from across the prod uct offerings. Some of the things 24

we show here are the rated storage volume, any input 2595

Heritage Reporting Corporation (202) 628

- 4888 rates, first

- hour ratings, a max GPM of the currently 1

rated units, recovery efficiencies and energy factors 2

as best we could, and then a range of thermal 3

efficiencies a nd standby loss for the residential duty 4

units. 5

So this plot is just an example. I don't 6

want to get in too much depth on this, but this kind 7

of shows you in terms of what the basic models are on 8

the market and what we ended up testing. So, once 9

again, just as an example to show that we tried to 10

represent as best as possible what is on the market in 11

terms of basic models. 12

So, for example, on the left one, the left 13

two bar charts, it shows green on the basic models 14

that are ultra

- low NOx. The red is t he low NOx, and 15

the blue is the standard NOx rating. So that's the 16

percentages on the market. The ones that we tested 17

are the next bar chart. So all of those

-- you know, 18

I don't want to go through each one of these bar 19

charts, but that tries to show yo u that we were 20

somewhat representative, tried to be representative, 21

in the models that we tested. 22

So we tested a total of 72 water heaters, 23

and this chart here shows you the breakdown of those 24

water heaters, consumer storage, gas/oil, electric 2596

Heritage Reporting Corporation (202) 628

- 4888 resistance , and heat pump units, consumer 1

instantaneous units, gas

- fired, and electric, and then 2

residential duty we tested gas

- fired units. 3

Okay. So, once again, these conversions, 4

these tested units were those that are covered by the 5

existing test procedures co vered by the new UEF test 6

procedure. 7

MR. BROOKMAN: Do we have questions or 8

comments before we move to the next section? 9

MS. SHEPHERD: I have a question. 10

MR. BROOKMAN: Amy. 11

MS. SHEPHERD: This is Amy Shepherd with 12

AHRI. So in the number it says that this focused on 13

models that met the April 2015 standards. So did all 14

of these meet those standard levels, or can you give 15

us a breakdown of

-- 16

MR. HEALY: They all met the existing 17

standard, the April 2015 standard. 18

MS. SHEPHERD: So it wasn't ju st focused

-- 19

they all met them. 20

MR. HEALY: Yes. 21

MS. SHEPHERD: Oh, and now when did you do 22

this

-- I'm sorry. Amy Shepherd again. And what was 23

the time frame for this testing? When did it

-- 24

MS. ARMSTRONG: In the past year. 2597

Heritage Reporting Corporation (202) 628

- 4888 MR. HEALY: Past y ear, yeah. 1

MS. SHEPHERD: So, okay. 2

MS. MEYERS: So this is Karen

-- 3

MS. ARMSTRONG: Since the test procedure was 4

finalized. 5

MS. MEYERS: Where were these units tested 6

at? 7

MR. HEALY: There were multiple labs at 8

which they were tested at. 9

MS. M EYERS: Such as? 10

MS. ARMSTRONG: Cortland. Same places you 11

test, no difference. 12

MS. MEYERS: And so the labs were

-- all met 13

ISO

-- 14

MS. ARMSTRONG: Yes. 15

MS. MEYERS:

-- 17 and 25? 16

MS. ARMSTRONG: It's all the labs you use. 17

It's no different. Y ou know the same labs we use. 18

MR. BOROS: Let me just

-- Joe Boros here. 19

I'd like to clarify the question. You indicated that 20

all the models met the 2015 that were tested? Of gas 21

or electric, or what are you

-- because the

-- 22

MR. HEALY: Yes. 23

MR. BOROS:

-- the data says otherwise. So 24

I'm just trying to clarify which categories you're 2598

Heritage Reporting Corporation (202) 628

- 4888 referring to when you

-- 1

MS. ARMSTRONG: So all the models had 2

ratings that would show that they comply with the new 3

standards. 4

MALE VOICE: Was the point of 15, yes. 5

MR. SACHS: A current rating. 6

MR. BOROS: There are several models. And I 7

don't know if you want to get into all the data here, 8

but

-- that would comply to the previous level, right? 9

For example, electric, there were several

-- 10

MR. HEALY: On ce again, they were rated to 11

meet the 2015 standards, and that's the measured data. 12

MR. YORK: Certified? 13

MS. ARMSTRONG: Well, it's the certified 14

data. 15

MR. YORK: Thank you. 16

MS. ARMSTRONG: Not necessarily the single 17

measurement, though. 18

MR. CAR NEVALE: Bruce Carnevale, Bradford 19

White. What date did you do this testing or what 20

dates? 21

MS. ARMSTRONG: So it was between July when 22

we finalized the test procedure, so July 2014, over 23

the past year to current. 24

MR. BROOKMAN: Frank Stanonik. 2599

Heritage Reporting Corporation (202) 628

- 4888 MR. S TANONIK: Frank Stanonik, AHRI. So I 1

guess the first question. So different units were 2

tested at different facilities. Were units of a 3

single fuel type all tested at the same facility, or 4

that also varied? 5

MS. ARMSTRONG: Most of them were all tested 6

at the same facility. There were some units that were 7

tested a couple times at the facility, the same unit. 8

MR. STANONIK: All right. So the real 9

question or a bigger question is if

-- so some units 10

were tested at different facilities. Did the analysi s 11

attempt to factor in the laboratory variability of the 12

test results? 13

MR. HEALY: No. So for the most part, the 14

tests were done

-- well, the tests were done, old test 15

procedure, new test procedure, in the same facility. 16

MR. STANONIK: Oh, okay. 17

MS. ARMSTRONG: So the delta. So we

-- 18

MR. STANONIK: Okay. 19

MS. ARMSTRONG: Every unit we pulled we 20

tested for current test procedure and new test 21

procedure. 22

MR. STANONIK: Right. 23

MS. MEYERS: So this is Karen with Rheem. 24

So does this

-- this is you tested 72 units. Does 25100

Heritage Reporting Corporation (202) 628

- 4888 that mean you ran 72 tests? 1

MS. ARMSTRONG: No. There are 72 individual 2

models. 3

MS. MEYERS: But did you test like each 4

model twice, like we're required to do when we certify 5

a model or did you

-- 6

MS. ARMSTRONG: No. 7

MS. ME YERS: So you only

-- 8

MS. ARMSTRONG: And you're not required to 9

test each unit twice. You're required to test two 10

units or more per model. 11

MALE VOICE: Yes. 12

MS. MEYERS: All right. So

-- 13

MS. ARMSTRONG: So no. What we have

-- we 14

compared single

- unit tests to single

- unit tests, one 15

to one. It's not ratings. We didn't compare rated 16

values to single

- unit tests, and we didn't compare 17

rated values to new rated value. We compared single

18

unit tests to single

- unit tests. 19

MS. MEYERS: And only one t est was run on 20

each

-- 21

MS. ARMSTRONG: Single

- unit test. 22

MR. HEALY: Well, one

-- right. For one 23

energy

- factor test, one

-- 24

MS. ARMSTRONG: Right. 25101

Heritage Reporting Corporation (202) 628

- 4888 MR. HEALY:

-- UEF test on the same exact 1

unit

-- 2

MS. ARMSTRONG: Right. 3

MR. HEALY:

-- was the equivalent. 4

MR. BOROS: I would draw your attention to 5

CS

- 10, CS

- 8, and CS

- 7. Are they in fact 95 or 94 6

combined water, the rated water heaters that were 7

tested? 8

MS. ARMSTRONG: I'll look. I don't have it 9

in front of me. 10

MR. BOROS: Is that

-- for example, CS

- 7

-- 11

MR. BROOKMAN: What are you referring to 12

there, Joe? 13

MR. BOROS: This is the

-- 14

MALE VOICE: The test model testing notes. 15

MR. BOROS:

-- Milburn type date. 16

MALE VOICE: Stapled 8/13. 17

MR. BOROS: For example

-- and I don't mean 18

to be picking on data, but CS

- 10 was tested with .902. 19

CS

- 8 was .901, and CS

- 7 was .855. Are these truly 20

certified to 95 or 94? 21

MS. ARMSTRONG: I will look. We'll look at 22

it. 23

MR. BROOKMAN: Okay. We'll dig that out. 24

Additional questions for Bill on this segment before 25102

Heritage Reporting Corporation (202) 628

- 4888 we

-- yes, Charlie. 1

MR. ADAMS: We voted, and I was out of the 2

room. I apologize if it's been addressed. Charlie 3

Adams, A.O. Smith. The question, it's been raised on 4

the seven residential duty units that we have a 5

warrant is

-- are we missing something there? 6

MR. HEALY: Those are rated at residential 7

duty. We would welcome input on any problems in the 8

testing because it was measured so that the data that 9

was shown in the NOPR was what was measured, so they 10

were rated as resid ential duty in terms of any 11

difference. 12

MS. ARMSTRONG: Right. So they are rated 13

above 75 and when they measured in the lab they come 14

out lower. So we could have thrown out orifices. We 15

could have added some burners. We didn't, but maybe 16

we should ha ve. 17

MR. ADAMS: Okay. 18

MS. ARMSTRONG: So if you think we should 19

have and we should retest and that would have an 20

impact, we can do that. 21

MR. ADAMS: Okay. A follow

- on question. 22

MS. ARMSTRONG: Yeah. 23

MR. ADAMS: So, on Table 322, residential 24

duty , commercial storage water heater attributes, RB4 25103

Heritage Reporting Corporation (202) 628

- 4888 is show as yes, condensing, but the vent type is 1

atmospheric. I need some clarification because

-- 2

MS. ARMSTRONG: Yes. 3

MR. ADAMS:

-- would atmospherics work 4

because hot air rises, and condensing unit s don't have 5

hot air to rise? 6

MS. ARMSTRONG: I got it. We'll look at it. 7

MR. BROOKMAN: We don't have it yet. Joe. 8

MR. BOROS: Just a followup question to 9

that. Maybe I misunderstood you, but there was one 10

unit tested to represent a model, or wer e there two 11

units tested of each to represent a model? 12

MS. ARMSTRONG: One to

-- 13

MR. BOROS: One? 14

MS. ARMSTRONG: I'm not using rated values, 15

right? I'm not trying to come up with what the rating 16

would be for that population of that model. That's 17

w hat you guys do when you come up with your cert. 18

MR. BOROS: Right. 19

MS. ARMSTRONG: I did a single

- unit test 20

compared to a single

- unit test for 72 models. 21

MR. BOROS: I understand that. 22

MS. ARMSTRONG: Yeah. 23

MR. BOROS: You're almost just basical ly 24

auditing a product with a single unit. 25104

Heritage Reporting Corporation (202) 628

- 4888 MS. ARMSTRONG: In theory. But I'm not 1

trying to come up with a rating

-- a rated

- value 2

conversion to a rated

-- because there's a lot of 3

things that go into your rating that are beyond just 4

the results of your specific test, right? So that's 5

why perhaps a test to test is a better comparison. 6

MR. BOROS: Well, I would

-- 7

MS. ARMSTRONG: And you all do your ratings 8

differently. 9

MR. BOROS: Well, I would think that if 10

we're trying to develop a correlation fa ctor or a 11

methodology that we would use more samples to generate 12

a higher degree of confidence. 13

MS. ARMSTRONG: Right. And like I said, 14

from day one, we welcome your data, and we were 15

pleased to see that AHRI provided data about 10 days 16

ago or so. So t hat's great. We have a slide on that, 17

and we need some more information from that data to be 18

able to accurately pull it into the analysis, at least 19

in the right format for which we've already done. 20

But I think part of this is we welcome any 21

data that yo u guys want to provide, confidential or 22

otherwise, to be included in this analysis. And we're 23

happy to provide you with a format for which all the 24

different fields that we would need to be able to 25105

Heritage Reporting Corporation (202) 628

- 4888 include it in the right bins and in the right buckets 1

and respond to some of your questions in the right 2

manner, because the way it's

-- and we can get to 3

this. We're jumping to the very last slide of our 4

presentation almost. But the way it's been provided 5

thus far, it does have some very helpful information 6

an d to an extent can be used in analysis. But it's 7

not aggregated with model characteristics to the level 8

of analysis that you guys are seeking, especially with 9

regards to the comments you are presenting today. 10

MR. BROOKMAN: Frank. 11

MR. STANONIK: Frank Stanonik, AHRI. I just 12

want to jump back one second on the residential duty 13

table. So those input rates were the measured input 14

rates during the test. 15

MR. HEALY: That is correct, yes. 16

MR. STANONIK: Okay. Test procedure I think 17

still requires that when you run the test, the unit 18

has to be within plus or minus 2 percent. 19

MS. ARMSTRONG: Yeah. So that's why I 20

brought that up. That's why I said we could retest 21

them, but what we were saying is as shipped

-- 22

MR. STANONIK: Okay. 23

MS. ARMSTRONG: I'm not sure it would come 24

out that much differently, but

-- 25106

Heritage Reporting Corporation (202) 628

- 4888 MR. STANONIK: Well, okay. But, well, in 1

fact, there's a bigger question, though. So all of 2

the other gas models that were tested, did they 3

likewise just fire the unit as it came out the box, or 4

did they in fact run the test procedure and set it to 5

be within plus or minus 2 percent? 6

MR. HEALY: We have no evidence that it 7

was

-- 8

MS. ARMSTRONG: It needed to be modified. 9

MR. HEALY:

-- modified, correct. 10

MR. STANONIK: Okay, okay. 11

MS. ARMSTRONG: So in other words

-- 12

MR. STANONIK: Okay. 13

MS. ARMSTRONG: We can go back and double

14

check the reports, but we make a note if they had to 15

make changes to any modifications model. And off the 16

tops of our heads, we don't remember any modific ations 17

that were necessary right out of the box to satisfy 18

that condition. Those did not satisfy that condition 19

even though they were rated at the correct vent, well, 20

correct loosely. 21

MR. BROOKMAN: Okay, Bill. 22

MR. HEALY: Now we're going to dive into the 23

ratings conversion. We'll very briefly go over the 24

mathematical approach that DOE has taken on this. So 25107

Heritage Reporting Corporation (202) 628

- 4888 the conversions were developed for basically three 1

metrics. So first

- hour rating to get a new first

- hour 2

rating, to get a new max GPM, and to ge t a new uniform 3

energy factor. 4

We examined three different methods as 5

possible ways to get these conversion factors. So the 6

first one is

-- I'm calling it a step regression. 7

This is purely data

- based. So just take the data we 8

have on these 72 units, d o regressions. The reason 9

why we're saying it's a step regression is that we use 10

this technique to evaluate which factors were 11

important. So some factors, if you combine them, they 12

didn't matter and they just complicated it. Some made 13

it worse, the regr essions. So the step regression 14

goes through and determines which one eventually 15

becomes the best combination. 16

The second approach is an analytical 17

approach, so this is purely based on, you know, math 18

and physics of what's going on to try to estimate ho w 19

this

-- how to convert from the old metrics to the new 20

metrics. And the third one is a combination of those. 21

So do a first cut doing an analytical approach using 22

the physics of what's going on and then use the data 23

to fine

- tune that model. 24

To assess these, we use root mean squared 25108

Heritage Reporting Corporation (202) 628

- 4888 error between the predicted values and the measured 1

values in all cases, and we'll go through that in a 2

second. So a really quick overview of the analytical 3

methods in which we looked at. So for delivery 4

capacity, we did n ot look at anything for first

- hour 5

rating. We decided that there was nothing that we 6

felt was appropriate to predict a first

- hour rating, 7

once again, purely from a physics basis. 8

For the max GPM, though, we did a quick 9

energy balance between the energy in and the energy 10

out at 125 and 135 degrees. So that is the basis of 11

the analytical approach to convert max GPM from old 12

values to new values. 13

For the uniform energy factor, there's three 14

different ones depending on your water heater type. 15

So first of all, for the consumer storage water 16

heaters, we based it on the water heater analysis 17

model, WHAM, which was published by Lawrence Berkeley 18

National Laboratory as part of a previous rulemaking. 19

So this takes basically the energy out, given 20

whatever your volume, volume per draw is, divides it 21

by the energy needed to create that hot water, plus 22

any standby loss of energy. 23

For instantaneous method, DOE developed a 24

modified analytical approach since standby loss is not 25109

Heritage Reporting Corporation (202) 628

- 4888 particularly relevant necessarily for instantaneous 1

water heaters. We attempted an analytical approach, 2

which accounted for the energy it takes to heat the 3

water, plus any energy loss from that water heater as 4

it decayed, as it decayed to ambient after each cycle. 5

For the residential duty s torage, we did 6

something very similar to the WHAM model. We had the 7

thermal efficiency metric and the standby loss metric 8

for the residential duty storage. We used those two 9

metrics to try to project what are the standby losses 10

and how much energy does i t take to heat that water. 11

So further details are in the NOPR. We're 12

not going to go into any deeper details into the 13

equations here, but there are further details in the 14

NOPR. 15

MR. BROOKMAN: Frank. 16

MR. STANONIK: Frank Stanonik, AHRI. Bill, 17

I'll l ook further I guess, but again, in terms of what 18

we're seeing, particularly on the residential duty, I 19

think however you try to convert standby loss to 20

standby loss coefficient may have missed the mark. 21

I'll try, if the details are in there, I'll sort the m 22

out, but there's something a bit off on that one. 23

MR. HEALY: Okay. Thank you. 24

MR. BROOKMAN: Charlie. 25110

Heritage Reporting Corporation (202) 628

- 4888 MR. STEPHENS: Charlie Stephens. Yeah, I 1

may take a stab at just sort of suggesting where that 2

is. In a lot of cases in the write

- up in the NO PR 3

anyway, you allude to essentially equating the 4

reduction in temperature in the two tests, which 5

you're trying to convert between as 135 to 125, and 6

that really isn't the case. 7

In the old measurement where you had an 8

average tank temperature of 135, th e delivered

-- the 9

early delivered tank temperature in that case, 10

especially for taller tanks, might have been 140 or 11

138, quite a bit hotter, and the water in the bottom 12

of the tank a lot cooler, whereas, you know, the 13

average tank temperature now in that same tank is 14

probably closer to 120, not 135, and if it's 15

delivering 125 at the beginning of the draw. 16

So not only does that affect standby losses, 17

but you also

-- I think if you look at the different 18

draw patterns, where in the old test procedure you'r e 19

removing

-- even in a 50

- gallon rated tank, you're 20

removing a quarter of the water in the tank per draw. 21

With some of these other draws, you're just moving a 22

little

-- a few gallons of water, and the thing will 23

trip at the bottom, you know, fairly early relatively 24

speaking and recover while the water heater is not 25111

Heritage Reporting Corporation (202) 628

- 4888 drawing. So you get a

-- you know, I think these 1

things have impacts that we've discovered in our own 2

lab testing, and then when you get to heat pump water 3

heaters, it's a whole different thin g because how they 4

respond to that is technology

- based. 5

MR. HEALY: I'll just go ahead. It is 6

stated in the NOPR that we did take some assumptions, 7

and we did state that that is an assumption, that the 8

delivered is the tank temperature. And we realize 9

that is an assumption, and we'd like your feedback on 10

how valid that assumption is. 11

MR. STEPHENS: Okay. I don't think it's 12

valid, and I think it may be somewhat responsible for 13

some of the disparities you're seeing between your 14

tested and your converte d values. 15

MR. HEALY: Thanks. 16

MR. BROOKMAN: Okay, thanks. Yes, Bruce. 17

MR. CARNEVALE: Bruce Carnevale, Bradford 18

White. Just to follow up on that, we've also 19

identified an issue because of the change from 135 to 20

125 and the outlet temperature and t he change from 25

- 21

degree delta T to 15

- degree delta T. In many cases, 22

the differential is not enough so that the upper 23

element turns on, and that has a dramatic impact on 24

the first hour rating beyond what you would expect 25112

Heritage Reporting Corporation (202) 628

- 4888 just with the stored energy at th e higher temperature 1

versus the lower temperature. 2

MR. BROOKMAN: Okay. Additional comments? 3

(No response.) 4

MR. BROOKMAN: Okay. 5

MR. HEALY: So this says which of these 6

conversion methods were selected. So for most of the 7

UEF conversions, we went with the combined analytical 8

and regression approach. We feel the analytical 9

approach captures most of the underlying physics, and 10

some of the things that you guys have just mentioned 11

here, we feel like the regression will hopefully 12

account for some of t hose other factors that the pure 13

analytical approach was not able to handle. 14

For the heat pump UEF conversion, we used 15

the regression method, and the reason why is that we 16

are basing all of these conversions on commercially 17

available information. So the recovery efficiency 18

values that are available on the AHRI database for 19

heat pump water heaters are their recovery efficiency 20

for the electric resistance element, so we don't think 21

that's representative of how a heat pump water heater 22

operates. So for tha t one, we based it purely on a 23

regression method, so we regress the data that we had 24

to come up with the UEF conversion. 25113

Heritage Reporting Corporation (202) 628

- 4888 For the first hour rating, we used a 1

regression method only. As I mentioned before, we did 2

not look at an analytical method for firs t

- hour rating 3

conversions. 4

For consumer units, we used the existing 5

first

- hour rating, and for the residential duty we 6

used the existing input rating. Or

-- right. There 7

were certain cases where we looked at the different 8

equations, and the RMS value

- - once again, that's the 9

root mean squared error

-- was very close between 10

alternative types of regressions. And there might be 11

some cases where the RMS of a different combination of 12

parameters may look a little better, but we decided to 13

go with maybe a s impler version or an alternative 14

version that we felt better representative. 15

In all cases, those differences were less 16

than one gallon, so we feel like it was within the 17

noise of the data and the regression, the uncertainty 18

of the regressions. 19

For the maximum GPM conversion, once again 20

from the old metric to the new metric, we used the 21

analytical method only. 22

Frank? 23

MR. BROOKMAN: Yes, Frank. 24

MR. STANONIK: Frank Stanonik, AHRI. Okay. 25114

Heritage Reporting Corporation (202) 628

- 4888 So on the heat pump UEF conversion

-- okay. But you 1

did test heat pumps, so why wouldn't you have used the 2

recovery efficiency value you got in your tests to 3

inform your conversion estimate? 4

MR. HEALY: We want the conversion factor to 5

be

-- anyone could use it with publicly available 6

data. Since we didn't see t he publicly available data 7

on a heat pump water heater, we didn't want to impose 8

that as the conversion factor. Yes, we could have 9

done it if you measure it, but we wanted somebody

-- 10

MR. STANONIK: Frank Stanonik, AHRI. As an 11

aside that maybe can be a ddressed at some point, we 12

are reporting the .98 because in fact the template at 13

the moment doesn't let us put in 240 or 380 percent or 14

whatever. 15

MR. HEALY: Okay. 16

MR. STANONIK: Because the recovery 17

efficiency of a heat pump would be basically at COP, 18

which is going to be, you know, multiples of 100 19

percent. And basically right now I think in the 20

format, in the template, we can't put in anything 21

above one I believe. 22

Right, Mike? Is that

-- 23

MS. SHEPHERD: I'll look at it. 24

MR. STANONIK: I'll dou ble

- check them. I 25115

Heritage Reporting Corporation (202) 628

- 4888 think I remember us having that discussion back at the 1

office, what do we do. 2

MS. ARMSTRONG: Why didn't you ask us? 3

(Laughter.) 4

MS. ARMSTRONG: I mean, just saying. Panel 5

that. We'll leave it at that. 6

MR. STANONIK: Yeah. Tha t will be a 7

separate discussion. 8

MS. ARMSTRONG: Okay. 9

MR. STANONIK: Yeah. 10

MS. ARMSTRONG: Look forward to it. 11

MR. STANONIK: Yeah. I have lots of hats. 12

That's not one of them. 13

(Laughter.) 14

MS. ARMSTRONG: Me too. 15

MR. HEALY: So this is not

-- this slide is 16

not meant as an eye chart and not to get through every 17

one of the digits, but I just wanted

-- we just wanted 18

to give you a flavor of what the conversion factors 19

look like and how they're breaking out. 20

So for consumer gas

- fired storage water 21

heaters, we found the need to separate these 22

conversion factors, whether or not there is a 23

condensing unit or non

- condensing. For non

24

condensing, furthermore, we felt like the regressions 25116

Heritage Reporting Corporation (202) 628

- 4888 were better when you're looking at different NOx 1

levels. 2

So for consumer gas

- fired water heaters, 3

there are four different conversions. You can see 4

that the first

- hour ratings are functions of the 5

former first

- hour ratings. Or, I'm sorry, the new 6

first

- hour ratings are a function of the existing 7

first

- hour ratin gs, and the UEFs are a function of the 8

analytical model, which we're calling UEF WHAM. So 9

that's the analytical conversion, and then you do a 10

regression on top of it. 11

For the oil

- fired, we have the one equation 12

as shown. For consumer electric water hea ter, DOE 13

proposes to separate it out between electric 14

resistance and heat

- pump water heaters. And there's 15

also a conversion for tabletop water heaters. 16

MR. BROOKMAN: Charlie? 17

MR. ADAMS: What was the thought process 18

that got you to separate standard NOx and low NOx? 19

Was it scattering the data, or was it some underlying 20

assumption you made going in? 21

MR. HEALY: When we looked at

-- we did not 22

group standard and low together. I heard Frank's 23

discussion or comment earlier on that. So we 24

separated th e three out. And we looked at these 25117

Heritage Reporting Corporation (202) 628

- 4888 equations that we've developed and compared to the 1

measured data, and we felt that based on the RMS 2

errors between these predicted new UEFs and the 3

measured UEFs were better if we separated out by NOx 4

levels as opposed to grouping all three together. 5

MR. ADAMS: I agree all three don't belong 6

together. 7

MR. HEALY: Yeah. 8

MR. ADAMS: But the standard and the low, I 9

guess I'm surprised to see you found a significant 10

enough difference to separate them out. 11

MR. HEALY: We looked at it either grouping 12

them all together or grouping

-- or doing all three. 13

So we welcome your comments. 14

MR. ADAMS: All or none is what

-- 15

MR. HEALY: We welcome your comments on 16

which one would be better for coverage. 17

MR. STANONIK: Fra nk Stanonik, AHRI. I 18

think, I mean, the way we looked at that, the standard 19

and the low NOx still have basically the same burner. 20

The ultra

- low NOx has a radically redesigned burner 21

we think would cause difference. 22

MR. HEALY: Okay. Thank you. 23

MR. B ROOKMAN: Jim Lut z has a question. 24

Jim, you should not be on mute. Let's hear from you 25118

Heritage Reporting Corporation (202) 628

- 4888 and hope we can hear you in the room. 1

MR. LUT Z : Do you hear me? 2

MR. BROOKMAN: Yes. Speak up. 3

MR. LUT Z : Oh, good, good. The conversion 4

from

-- for first

- hour rating, it

-- when you do

-- 5

you did

-- you tested under the energy factor. You 6

got a

-- I mean first

- hour rating on an energy factor. 7

You got a first

- hour rating under the UEF test, and 8

you came up with first

- hour rating via the regression 9

method and t he forward UEF. And then you used

-- the 10

way I understand it, you used the regression of the 11

first

- hour rating to determine which category

-- which 12

draw pattern to use. 13

MR. HEALY: Yes. 14

MR. LUTZ : Is that

-- and then my question 15

on that is if you look at the draw pattern that's 16

determined by the first

- hour rating for the consumer 17

storage model, there were, when I looked through the 18

data, there were nine of them that came into a 19

different draw pattern using the regression FHR than 20

the tested FHR. And I 'm thinking that might actually 21

cause some problems, that you'd get a very radically 22

different answer because you tested under a different 23

draw pattern than you should have. I just wanted to 24

point it out, seeing things and not understanding 25119

Heritage Reporting Corporation (202) 628

- 4888 what's going o n or

-- 1

MR. HEALY: We tested the UEF to the 2

measured first

- hour rating, measured and new first

3

hour rating. 4

MR. STEPHENS: Does that include the 5

measured new tank volume? 6

MR. HEALY: The measured new

-- 7

MR. LUTZ : That wasn't my question. My 8

firs t question is when you get a

-- when you want to 9

do the conversion, you do

-- you come up with what the 10

first

- hour rating is under the new test procedure. 11

But if you actually ran the new test procedure for 12

nine of the consumer storage, you end up with a f irst

13

hour

-- a tested first

- hour rating that puts you in a 14

different category than the regression first

- hour 15

rating would. 16

MS. ARMSTRONG: Okay. 17

MR. HEALY: And what's

-- and is there a 18

question or other comment? 19

MR. LUTZ : If there's an easy way I c an 20

quickly turn from the slides, I'd be able to do that. 21

MS. ARMSTRONG: I think we get the point. 22

We just have to look into it. It's not an issue. 23

MR. STEPHENS: Well, yeah. And I want to to 24

Jim's point, I also want to add that if you're testing 25120

Heritage Reporting Corporation (202) 628

- 4888 th e first

- hour rating for the UEF test procedure, the 1

volume that's in that

-- the volume of water you're 2

actually working with is whatever is actually in the 3

tank regardless of the rated volume. So that will 4

possibly give you a different error in your equa tions 5

if you're not using that same volume. 6

MS. ARMSTRONG: So you would argue using 7

measured volume throughout. 8

MR. STEPHENS: Yeah, because you're going to 9

get a different calculated number if you're not using 10

the measured volume from the test when y ou're trying 11

to compare to the test results. 12

MR. HEALY: Once again, we're looking at the 13

conversions right now, so I'd ask you to reassess 14

whether the storage volume comes in. And I don't

-- 15

MR. STEPHENS: I'm looking at first

- hour 16

rating here, just volume 125 over volume 135. 17

MR. HEALY: That's the max GPM I believe. 18

MR. STEPHENS: Yeah, 1.147 and

-- yeah, 19

you're looking at the temperature differences, which 20

are not correct either. So it's not 135 minus 58 and 21

it's not 125 minus 58. I think I c ommented on that 22

earlier. So these equations build up from the bottom, 23

and I think you've got a series of things that will 24

lead you inevitably to where your tested values will 25121

Heritage Reporting Corporation (202) 628

- 4888 be at odds with your calculated values if you're not 1

using apples and apples in your equations. 2

MR. HEALY: Yeah. And I appreciate your 3

comments. Please submit them. But also realize that 4

V could be either storage volume or delivered volume 5

per day. So just

-- I'll just ask you to make sure

-- 6

MR. BROOKMAN: Charlie. 7

MR. AD AMS: Charlie Adams, A.O. Smith. I 8

used to be a real engineer, so I'll defer to the real 9

engineers who are in the room. But the first

- hour 10

test today from the EF is based on actual tank volume, 11

not on rated storage volume. So the first

- hour rating 12

has a lways been based on how much physical water is in 13

the tub. 14

MR. STEPHENS: I know. I just want to make 15

sure the equations have that same number in there too 16

when they're trying to do a calculational equivalent 17

and measuring it to that very same test or c omparing 18

it to that tested result. 19

MR. BROOKMAN: Yes, Joe. 20

MR. STEPHENS: And the delivery volume is, 21

as Jim pointed out, based on the draw pattern. 22

MR. BROOKMAN: Okay. 23

MR. BOROS: I have a question on test sample 24

size. For the ultra

- low NOx cat egory there, non

- 25122

Heritage Reporting Corporation (202) 628

- 4888 condensing, I see that there was

-- it's described 1

that there was only four models tested. So is that a 2

significant sample size to generate an equation like 3

that and then the conversion equation, and then also 4

is that a significant sample size to actually set a 5

minimum standard based on four tests? Are we 6

recognizing that the market has hundreds of thousands 7

of ultra

- low NOx models? And there's probably 10, 20 8

different types and styles of water heaters within 9

that category. 10

MR. STANON IK: Hundreds of thousands? 11

MR. BOROS: Well, how much is it, Frank? 12

Ultra

- low NOx

-- 13

MR. STANONIK: Ultra

- low NOx? 14

MR. BOROS: What's the market size? 15

MR. STANONIK: Not hundreds of thousands of 16

models. 17

MR. BOROS: No. Hundreds of thousands of 18

units sold. 19

MR. STANONIK: Oh, okay. 20

MR. BOROS: And there is

-- 21

MR. STANONIK: I thought you said models. 22

MR. BOROS: No. There's hundreds of 23

thousands of units sold. Let me clarify. And there 24

is probably at least, what, a dozen different style s 25123

Heritage Reporting Corporation (202) 628

- 4888 of water heater, different designs out there from 1

different manufacturers? 2

MS. ARMSTRONG: Right. So I think what 3

you're seeing from us

-- and, you know, I'm going to 4

sound like a broken record at this point. I've told a 5

number of you this at a varie ty of different places, 6

but we would welcome your data. I mean, if you want 7

it in there

-- that's not to say that, you know, DOE 8

did test a fair number of models for this exercise. 9

Perhaps you could argue that we need to have more in 10

certain categories a nd we need to have models with 11

different attributes. We didn't get them all. And 12

you can point out specific models that you'd like us 13

to test, or you are more than welcome to provide us 14

specific test data that you want us to consider. 15

We're completely open to doing that, and we 16

stated that a number of times throughout the past 17

year. I don't think it's realistic that DOE is going 18

to test every model out there. But we did do a fair 19

amount of testing for this rule in the limited amount 20

of time we had. 21

MR. BROOKMAN: Frank. 22

FEMALE VOICE: Well, let Bruce go first. 23

MR. STANONIK: Frank Stanonik, AHRI. 24

MR. BROOKMAN: Hold on. Hold on. Bruce, 25124

Heritage Reporting Corporation (202) 628

- 4888 you want to go first? 1

MR. CARNEVALE: Yeah. 2

MR. BROOKMAN: Okay. 3

MR. CARNEVALE: I hear your frustrati on, 4

Ashley, and I feel for you, as you know from our 5

previous conversations. 6

MS. ARMSTRONG: Yeah. 7

MR. CARNEVALE: Understand what this 8

industry has just gone through. Don't interpret that 9

we haven't submitted gobs of data as we don't want to 10

help. I nterpret that as we've just gone through one 11

of the most massive changes this industry has ever 12

gone through, and all of our resources have been tied 13

up to meet the April 15 NAECA

- 3 requirement. And the 14

timing of this has been very challenging not only fo r 15

you but for us as well. 16

MS. ARMSTRONG: No, and I completely 17

empathize with that, but I don't think it's fair to 18

also

-- 19

MR. CARNEVALE: And back to Harvey's point, 20

and you know where I stand on this. This is not the 21

normal rulemaking process. You have some handcuffs on 22

you because of the statutory requirement

-- 23

MS. ARMSTRONG: Yeah. 24

MR. CARNEVALE:

-- or multiple statutory 25125

Heritage Reporting Corporation (202) 628

- 4888 requirements. We did not support AEMTCA. We were 1

looking for a simplified version that would be 2

technology blind. That' s not what happened. It's 3

morphed into something incredibly more difficult and 4

challenging. And I feel for you. We also have lots 5

of issues with this that are coming out. 6

MS. ARMSTRONG: Yeah. 7

MR. BROOKMAN: Karen. 8

MS. MEYERS: So I'm just going t o push back 9

on that DOE tested several models. I think 72 models, 10

one, you know, out of a market that's averaged over 11

8 million water heaters per year over the last five 12

years is not a significant sample. DOE requires 13

manufacturers to do significant test ing on every model 14

that we introduce. And the burden is on DOE. We're 15

trying to help, but the fact that this analysis is so 16

far off, to me, the burden is now coming back on 17

manufacturers to do this. And I think as part of the 18

rulemaking what Congress to ld DOE to do was to come up 19

with an adequate

-- and how you can think 72 models is 20

adequate to come up with a valid rule is beyond me. 21

It should not be the burden of the 22

manufacturers to have to provide all of this 23

information, but that's what's happened . So I do not 24

agree that DOE did a lot of testing on this rule. I 25126

Heritage Reporting Corporation (202) 628

- 4888 think you did a woefully inadequate amount of testing 1

on this rule, so I'm pushing back on that one. So 2

I'll be quiet. 3

MR. BROOKMAN: Okay. Other comments here? 4

Frank, do you have ano ther comment here? 5

MR. STANONIK: Frank Stanonik, AHRI. I just 6

want to mention, listening to Ashley, that, yeah, 7

in

-- related to Joe's question, I think in the case 8

of the ultra

- low NOx, definitely

-- and I was looking 9

at what we've provided. There ne eds to be some more 10

information on ultra

- low NOx models with higher 11

inputs. All of yours were right around 40,000, you 12

know. And again, talking about the variety of models 13

that exist, and maybe even I have to look at the 14

venting situation. And I looked. We have some that 15

have higher inputs, but that becomes a big factor. So 16

I think that needs

-- one of those areas we need to 17

look a little closer, or look at more models. 18

MR. BROOKMAN: Neil McDonnell, who is 19

joining us online, has a question and a comment. 20

Neil's question is, "Was the draw usage statistically 21

significant in the regression? If so, wouldn't the 22

conversion factor be different for different 23

draw/usage patterns?" 24

MR. HEALY: I'm struggling to understand the 25127

Heritage Reporting Corporation (202) 628

- 4888 question. 1

MR. BROOKMAN: Wa nt me to read it again? 2

MR. HEALY: Yes, please. 3

MR. BROOKMAN: The question is, "Was the 4

draw usage statistically significant in the 5

regression? If so, wouldn't the conversion factor be 6

different for different draw/usage patterns?" 7

MR. HEALY: So I think the question is 8

should these be broken out by different draw patterns 9

-- 10

MS. ARMSTRONG: Yeah. 11

MR. HEALY:

-- I think is the question. We 12

found that we feel like this is the best approach, you 13

know. 14

MS. ARMSTRONG: We didn't feel like that 15

le vel of detail was necessary. 16

MR. HEALY: Right. 17

MS. ARMSTRONG: But obviously we welcome 18

comments on that. 19

MR. BROOKMAN: Okay. So, Neil, please

-- 20

MR. HEALY: That's right. I would say also 21

thank you. The WHAM, we feel like the WHAM equations 22

a ccount for the different draw pattern sizes. 23

MR. BROOKMAN: Okay. 24

MR. HEALY: Thank you. 25128

Heritage Reporting Corporation (202) 628

- 4888 MR. BROOKMAN: Yes, Charlie. 1

MR. ADAMS: A clarifying question way back 2

in the last topic. I'm sorry. I apologize. I didn't 3

ask all my questions. On Table 3.22, where I asked 4

about the condensing atmospheric, there is also a 5

column

-- the right

- most column says standing pilot or 6

electric ignition, and the entries in that column are 7

yes and no. Does yes mean electric ignition and no 8

means standing pilot? 9

M S. ARMSTRONG: Got it. 10

MR. HEALY: We'll have to check that. 11

Sorry. 12

MS. ARMSTRONG: So, Frank, just to go back 13

to one thing you said earlier. 14

MR. STANONIK: Okay, yeah. 15

MS. ARMSTRONG: We just played around with 16

the template, and we can definitely enter values above 17

one for recovery efficiency. You guys should have no 18

issue if you're using our template online. 19

MR. STANONIK: Then I have to go back and 20

talk to our people, okay? 21

MS. ARMSTRONG: Yeah. 22

MR. STANONIK: Maybe it's all mixed up. I 23

don't know. 24

MR. BROOKMAN: Okay, Bill. 25129

Heritage Reporting Corporation (202) 628

- 4888 MR. HEALY: So the next slides show some 1

conversion results that we found based on our test 2

data. You can see that in your slide deck. So on the 3

X

- axis is the actual measured first

- hour rating for 4

consumer stora ge units. On the Y

- axis is the 5

regression value that we found. So a perfect 6

correlation would fall on that solid line, so that 7

would mean the measured was exactly what the regressed 8

new value is. So this is what we found for consumer 9

storage first

- hour rating. The next slide shows the 10

uniform energy factor. Question for Harvey? 11

MR. SACHS: This is Harvey. I'm going to 12

rant. I have spent a little bit of time across a 13

bunch of fields arguing that this particular 14

formulation always makes data look muc h better than 15

they are, and the appropriate approach is not FHR 16

versus FHR but the anomaly versus the volume. 17

What I'm interested in, the data, are the 18

difference between the new regression and the 19

measured, not the correlation. So I would like to see 20

t he

-- since I don't have the data, I'd really like to 21

see

-- I mean, I see some deltas that are in the 15 22

percent range and a lot of them that are much smaller. 23

I can't really use this, this depiction. 24

MR. HEALY: The data are available. I know 25130

Heritage Reporting Corporation (202) 628

- 4888 you're not going to be able to crunch it right now, 1

but the data are available. 2

MR. SACHS: End of rant. 3

MR. HEALY: Thank you. 4

MR. BROOKMAN: Charlie Stephens. 5

MR. STEPHENS: Charlie Stephens. As Jim 6

Lutz pointed out, there were nine models that he foun d 7

in the data where the disparity was large enough to 8

put them in a different draw pattern category. So, 9

when you moved on to utilize the FHR results, how did 10

you deal with those nine that had a different 11

calculated FHR than measured? 12

MR. HEALY: We use d the measured first

- hour 13

rating under the new test to determine which draw 14

pattern. 15

MR. STEPHENS: Okay. 16

MR. HEALY: So the measured uniform energy 17

factor is based on the measured first

- hour rating. 18

MR. STEPHENS: Okay. Thank you. 19

MS. ARMSTRONG: Which you would agree with 20

doing. 21

MR. STEPHENS: Yes. 22

MR. HEALY: Once again, this is for consumer 23

storage. We've been down the heat pump, uniform 24

energy factor to a different slide for the scaling 25131

Heritage Reporting Corporation (202) 628

- 4888 purposes. And I'm just going to go through these. 1

These are available to you. These are the equations 2

that we came up with for consumer instantaneous. So 3

for the new max GPM under both gas

- fired and electric 4

was based on the analytical approach, as we said, and 5

the UEF is based on the model, regression to the 6

model. 7

This is the plot of the new measured max GPM 8

on the X

- axis and the analytical approach on the Y

9

axis. And then the next slide is the UEF, the 10

measured on the X

- axis and the analytical regression 11

on the Y

- axis. 12

For residential duty, these are the 13

conversion equations that have been derived, so they 14

are based on the input rate Q, and then the UEF is 15

based on that analytical approach that we discussed, 16

sort of a modified version of the WHAM. And the data 17

are shown here. So this is the firs t

- hour rating. 18

And the next slide is the uniform energy factor. 19

MR. BROOKMAN: Frank. 20

MR. STANONIK: Frank Stanonik, AHRI. Can 21

you go back to Slide 26 for a minute? I very likely 22

might be being a little dense on this one. Okay. So 23

we've got this w onderful regression, analytical 24

regression, UEF. And I'm going to look at just at the 251 32

Heritage Reporting Corporation (202) 628

- 4888 kind of yellow square boxes. So, if I did that 1

exercise just for the low NOx results here, I don't 2

see how I get the line that you're getting. It seems 3

to me I'd get a very differently sloped line. 4

MR. HEALY: We can research that. Yeah, 5

also consider the fact that there are some yellow 6

boxes that have Xs over them. 7

MR. STANONIK: Yeah. 8

MR. HEALY: That they are included in this 9

correlation. 10

MR. STANONIK: So, okay, so if we took just 11

the yellow boxes with Xs or not Xs and ran this 12

analytical regression, I'd get the same line? 13

MR. YORK: Did you not say the line only 14

represents perfect correlation and doesn't represent 15

the equation you proposed? 16

MALE VOICE: That's not a regression. 17

MR. STANONIK: Oh, okay. That's

-- yeah, 18

I'm sorry. Thank you. 19

MALE VOICE: Okay. Thank you. 20

MALE VOICE: The lines

-- you're right. 21

MALE VOICE: Yes. Thank you. 22

MR. STANONIK: Well, why is it there now? 23

(Laughter. ) 24

MR. STANONIK: All right. Okay. All right. 25133

Heritage Reporting Corporation (202) 628

- 4888 Sorry. 1

MR. SACHS: Frank, that's to draw your eye 2

so you don't look at anything else. 3

(Laughter.) 4

MS. ARMSTRONG: We were trying to finish 5

this meeting before lunch. 6

MR. BROOKMAN: Charlie. 7

MR. ST EPHENS: Charlie Stephens. Just

-- 8

this is an esoteric question. Did you make any 9

attempt to figure out what the anomalous number 10

examples were, what was causing the rather radical 11

departures between some of them? 12

MR. HEALY: Data were reviewed pretty 13

thoroughly. I will say that. So, from the private 14

labs, they provided the data, and it was combed 15

pretty, pretty rigorously. There were a lot of tests 16

that we asked for, you know, that were not included. 17

So we feel like we captured any anomalies that m ay be 18

going on in the test data from our review. 19

MR. STEPHENS: Yeah. I mean, I would try to 20

explain it also just by the nature of the water heater 21

being tested and whether it is different than others 22

in the way it responds to the new test procedure 23

ver sus the old and whether it's

-- how relevant its 24

old EF really is to the new UEF test, and maybe it 25134

Heritage Reporting Corporation (202) 628

- 4888 isn't. 1

MR. HEALY: There were no rigorous studies 2

done like that. 3

MR. STEPHENS: Oh, okay. 4

MR. HEALY: So now we're going to go into 5

the energy conser vation standard. So that was all 6

based on just the conversion factors from old metrics 7

to new metrics. The approach taken here was the so

8

called percent different method

-- the percent 9

difference method. So we looked at every unit on the 10

market. We app lied the conversion to every single 11

unit, so we had publicly available data on every unit. 12

We applied that conversion to get a new UEF value. 13

So basically, first we figure out which bin it would 14

fall under under our first

- hour rating and then get a 15

new U EF value. 16

For that model, we determined what was the 17

current minimum energy factor or minimum thermal 18

efficiency for every unit on the market. We then 19

found the percent difference between that unit's 20

energy factor, minimum energy factor, given its 21

volum e. We also did the same for thermal efficiency 22

for the residential duty units. 23

What we then did is we computed an 24

associated minimum UEF which was the same percentage 25135

Heritage Reporting Corporation (202) 628

- 4888 below our new UF value that we determined. And I will 1

have a slide here next which ho pefully will describe 2

this a little bit more. And then we found a line 3

through the minimum UEF values. 4

So I'm going to just go to the next slide to 5

kind of describe this a little bit more. So this is 6

one example. So this is consumer storage gas, mediu m 7

draw pattern. So this shows all the units that we 8

noticed that would fall under that medium draw 9

pattern. The yellows are what we converted would be 10

their new UEF. 11

The green dots show the percent

-- so given 12

that energy factor is a certain amount abo ve 13

percentage

- wise its minimum energy factor for that 14

volume, we then determined which

-- the green points 15

would correspond to that UEF, which would be the 16

minimum value, the same percentage below that the 17

energy factor minimum is above the measured rated 18

energy factor. 19

Then what we did is we found the lowest 20

points, those lowest green points, and we fed a line 21

through it. And that's how we determined these 22

relations between the minimum standard, minimum UEF, 23

and storage volume. 24

MR. BROOKMAN: Frank. 25136

Heritage Reporting Corporation (202) 628

- 4888 MR. STANONIK: Frank Stanonik, AHRI. So, 1

Bill, first of all, so you looked at, in this case, 2

you looked at all consumer storage gas models that 3

would fit into the medium draw. 4

MR. HEALY: All of them, right. Yes. 5

MR. STANONIK: All units, all models . Okay. 6

And then you

-- okay. Then you converted, and then 7

you tried

-- I guess I'm trying to figure out here, if 8

you only looked at models, currently rated

-- I'm 9

sorry. If you only looked at models rated to the 10

current minimum

-- as an example, let's say that

-- 11

well, this is medium use. Let's say that the minimum 12

is either

-- I'm trying to remember now. Let's say 13

either .62 or .60. That probably covers most of them. 14

If you had picked only those models that hit that 15

minimum, that were rated at the minimum, and were in 16

this bin, would we get a different result? 17

MR. HEALY: We had concerns that 18

combinations of different UA values, thermal 19

efficiencies

-- in that case, water heaters that are

- 20

- if we didn't look at water heaters above the 21

minimum, t hat there might be a situation where that 22

water heater would fall below the minimum and would 23

then suddenly become noncompliant if we only looked at 24

the minimum

-- the minimally compliant energy factor 25137

Heritage Reporting Corporation (202) 628

- 4888 ones

-- we were concerned that there would be cases 1

wh ere higher ones would fall below. 2

MR. BROOKMAN: Charlie. 3

MR. STEPHENS: Just a quick question again. 4

Again, explain the derivation of the UEF and minimum 5

UEF numbers. 6

MR. HEALY: Sure. And I admit that it's

-- 7

MR. STEPHENS: Just in simple terms

. 8

MR. HEALY: Sure. So if we looked at a plot 9

of, say, a given water heater, so one set of yellow 10

and green

-- and does this pointer work if I do this? 11

So let's look at a yellow dot and its corresponding 12

green dot. So those are

-- those two points are for 13

the same water heater model. 14

MR. STEPHENS: Right. 15

MR. HEALY: If we look at the energy factor 16

ratings, this yellow dot here would be a certain 17

percentage above its minimum required efficiency. 18

MR. STEPHENS: So the tested EF would be a 19

certain amount above its minimum required EF 20

percentage

-- 21

MR. HEALY: You rated the certified 22

energy

-- 23

MR. STEPHENS: Certified value is so much 24

above the minimum required value, so much percentage 25138

Heritage Reporting Corporation (202) 628

- 4888 above. 1

MR. HEALY: That's correct. 2

MR. STEPHENS: And it s tested EF, your 3

tested EF? 4

MS. ARMSTRONG: We didn't use that here. 5

MR. HEALY: This is all unrated. 6

MS. ARMSTRONG: This is always unrated. We 7

used the conversion of rated. 8

MR. STEPHENS: So this is all

-- okay. And 9

so

-- and that

-- but I'm m ore interested in the UEF. 10

So I understand the EF part of it. But when you did 11

UEF, what's the yellow? Is that tested? 12

MR. HEALY: This is

-- no. This is 13

converted from a data point, rated value. This is 14

converted from rated energy factor and first

- hour 15

rating

-- 16

MR. STEPHENS: Okay. 17

MR. HEALY:

-- into a UEF. 18

MR. STEPHENS: Okay. So you took the rated 19

EF, used your conversion factor to get a UEF, and then 20

compared that to the converted minimum. 21

MR. HEALY: Right. So that the green dots 22

are the same percentage below the new UEF as the 23

minimum energy factor is. 24

MR. STEPHENS: Right, right, okay. I got 25139

Heritage Reporting Corporation (202) 628

- 4888 you. 1

MR. BROOKMAN: Charlie. 2

MR. ADAMS: Charlie Adams, A.O. Smith. The 3

population of consumer storage gas that you did all 4

this math o n or all

-- is everything in the directory 5

or just NAECA

- 3 compliant? There's a lot of NAECA

- 2 6

compliant stuff in here. Is that a correct 7

assumption? 8

MR. HEALY: I don't

-- yeah. 9

MS. ARMSTRONG: Yeah. Yes, it does. 10

MALE VOICE: I think it was only ones that 11

are compliant. 12

MS. ARMSTRONG: Just only ones that would be 13

compliant are in there? 14

MALE VOICE: Correct. With the April 15

-- 15

MS. ARMSTRONG: But they were on the market, 16

so they would have been on the market over the past 17

year. It's no t just all the ones that are

-- 18

MR. ADAMS: So there's a whole bunch that 19

weren't on the market until recently. 20

MS. ARMSTRONG: I know. I knew that's where 21

you were going. 22

MR. BROOKMAN: Joe. 23

MR. BOROS: Bill, how did you handle the 24

draw patterns where you didn't have product listed? I 25140

Heritage Reporting Corporation (202) 628

- 4888 think there's some very small and low bins that may 1

not have product actually listed. 2

MR. HEALY: Very good question. I'm sorry I 3

didn't address that. So there are situations where 4

there would not be a product f or

-- let's just throw 5

out an example

-- maybe a

-- if there was

-- if we 6

looked at the various very small draw pattern, there 7

might have been products that fell into that. 8

In that case, what we ended up doing is we 9

used the analytical approach to estima te the entire 10

population of water heaters, all of them, every 11

volume. We estimated what the UEF would be at that 12

low draw pattern, okay? So then what we did is we fit 13

this line through the minimum UEF that we computed for 14

each one of those draw patterns. So thank you. I 15

apologize I didn't mention that. So in those cases

-- 16

the other

-- also, if we only had one single data 17

point in a draw pattern, we did the same thing as well 18

so we could generate a line. 19

MR. BROOKMAN: Harvey? 20

MR. SACHS: This is H arvey. And to me, the 21

takeaway seems to be that if my product was legal with 22

EF, it's going to stay legal with UEF. 23

MR. HEALY: That was the intention of this, 24

yes. 25141

Heritage Reporting Corporation (202) 628

- 4888 MR. SACHS: That's the bottom line for that 1

graph. 2

MS. ARMSTRONG: Right. And we di d it 3

probably in what you could argue is the most 4

conservative way. 5

MR. SACHS: Okay. 6

MR. BROOKMAN: Thank you. Please say your 7

name. 8

MR. YILMAZ: Aykut Yilmaz, AHRI. So just 9

looking at the numbers here, it appears that you're 10

using the rated stora ge volume as rated per the EF 11

test procedure. So, with the UED, there's going to be 12

a change probably for most of these products. In 13

effect, what the change is going to be is all those 14

green dots are going to move to the left a bit because 15

people will ha ve to claim a lower rate of storage 16

volume. So, if you keep the line where it is, those 17

ones at the bottom are actually going to shift to an 18

illegal UEF rating. So there needs to be some 19

accounting for the impact of the test procedure change 20

and how that determines the rated volume of those 21

products. 22

MR. HEALY: Thank you. 23

MR. BROOKMAN: Okay. Thank you. Additional 24

comments here? 25142

Heritage Reporting Corporation (202) 628

- 4888 MALE VOICE: Good point. 1

MR. BROOKMAN: Okay. 2

MR. HEALY: So, as you can see, these are 3

just the way the standards are laid out or DOE is 4

proposing to lay them out. I don't want to read 5

through all this in great detail, but it's by 6

April 15 there was a cutoff at 55 gallons for these. 7

There is very small, low, medium, high, so there's 8

different minimum efficiency stan dards depending upon 9

which draw pattern this would fall under. And let me 10

just leave it at that. 11

MR. BROOKMAN: Frank. 12

MR. STANONIK: Frank Stanonik, AHRI. So 13

this was one of our issues. So based on what I saw in 14

the previous graph and this, these f ormulas were 15

derived assuming that V sub r is like 30 gallons, 40 16

gallons, or 50 gallons. 17

MR. HEALY: Yes. 18

MR. STANONIK: Okay. And if nothing 19

changes, V sub r will not be 30, 40, or 50, because 20

DOE regulations, it will have to be the average of 21

measu rements, and manufacturers

-- the solution will 22

be just re

- rate the rating. So again, we would like 23

to have some idea what's going to happen with that 24

petition. 25143

Heritage Reporting Corporation (202) 628

- 4888 MR. BROOKMAN: Okay. Started again. Joe. 1

MR. BOROS: Joe Boros. Bill, just a follow

2

up question. So after you completed these equations, 3

did you go and check some products? Back to I think 4

Harvey's question, the intent was to make sure the 5

product that's currently complying would comply under 6

the new levels proposed. So did you check some key 7

water heaters to make sure that that's still a 8

valid

-- 9

MR. HEALY: Well, as stated, anything 10

that

-- we feel like anything that is currently rated 11

with a given energy factor will be above that 12

standard. 13

MR. BOROS: Is it verified

-- 14

MR. HEALY: That's the way the lines were 15

designed. 16

MS. ARMSTRONG: Yeah. 17

MR. BOROS: Was it verified with tests I 18

guess is my question. 19

MR. HEALY: We did

-- we just went by what's 20

rated, assuming that the rated value is

-- 21

MS. ARMSTRONG: The answer is no. 22

MR. BROOKMAN: Bruce. 23

MR. CARNEVALE: Bruce Carnevale, Bradford 24

White. I understand that on the gas side. What would 25144

Heritage Reporting Corporation (202) 628

- 4888 that graph look like on the electric side if you need 1

to develop a pattern? Because our data is showing 2

something very much differen t, where the gas products 3

in many cases the minimum efficiency standard is 4

actually less stringent on the electric side. It is 5

considered to be more stringent, to the point your own 6

data shows that product that's legal to sell today 7

would not be legal to sell once this is implemented. 8

MR. HEALY: We'd use the same approach on 9

electric. 10

MS. ARMSTRONG: Yeah. So I'm going to use 11

my words carefully here because I think what you're 12

saying is we pull products from the market today who 13

have certified they c omply with the standards today. 14

When we tested them, as you tested them, I 15

think what is revealed is there's test data that shows 16

that the products may or may not have single test unit 17

results that come back below or above the standard. 18

There's some sca tter there. 19

You know, a single unit test is not how DOE 20

determines whether something complies with the 21

standards. Rated values is a determination by the 22

manufacturer. Both your tests and our tests reveal 23

that there may be a larger issue going on there. I 24

think we're going to leave it at that for this 25145

Heritage Reporting Corporation (202) 628

- 4888 meeting. 1

MR. CARNEVALE: Okay. So the data that 2

we've submitted, the new tranche of data that came in 3

on May 14, shows that same sort of pattern

-- 4

MS. ARMSTRONG: Correct. 5

MR. CARNEVALE:

-- with n ot a whole lot of 6

differential, but still out of the 14 units that we 7

submitted data for, nine of them wouldn't meet the 8

requirement any longer where they did currently. 9

MS. ARMSTRONG: So your data contains a 10

number of dots that fall below the levels bo th in 11

terms of UEF, but I would argue also in terms of EF. 12

MR. CARNEVALE: And you didn't find that for 13

gas? 14

MS. ARMSTRONG: We did not find that for 15

gas. 16

MR. BROOKMAN: These are the last slides 17

that Bill has, and then we have the slides that Frank 18

has. 19

Let me note that it's 10 minutes after 1 20

almost. Shall we pause for lunch or should we press 21

on? Press on? You want to press on? How many want 22

to press on? Show of hands. Not that many. 23

MALE VOICE: I'm willing to press on. 24

MR. BROOKMAN: Okay. Let's press on then. 25146

Heritage Reporting Corporation (202) 628

- 4888 MS. ARMSTRONG: So I think we're pretty much 1

done. 2

MR. BROOKMAN: Yeah. 3

MS. ARMSTRONG: Can you go to our next slide 4

for me? So request for additional data. We'll do 5

this one more time just because we all really like 6

eac h other and everyone loves to hear me talk. 7

So you did submit data to us. We are 8

grateful for that. We appreciate that. DOE does need 9

some additional detail about those tested units. 10

Given some of the comments you're sending to us, given 11

some of the feedback you've given us today, we need 12

some model characteristics. We don't necessarily want 13

manufacturer name and model number because I know 14

that's something you clearly don't want to give us, 15

but at least some general characteristics of how do we 16

figu re out what buckets they fall into beyond what you 17

have given us is going to be helpful for us to 18

accurately input it into our data set of 72. 19

For any other models that you have been able 20

to test that you would be willing to share with us 21

either confiden tially or for the record, we would 22

welcome the opportunity. They need to be submitted by 23

June 15, 2015 to be considered at least initially in 24

what we're doing for the next steps. Our plan right 25147

Heritage Reporting Corporation (202) 628

- 4888 now is to move forward with a final rule after June, 1

but we will see in light of this meeting what our next 2

steps are after we consider all the comments and after 3

we look in more detail about some of the data you've 4

given us. 5

MR. CARNEVALE: Can you give us a template 6

which will give us

-- 7

MS. ARMSTRONG: Absol utely, absolutely. 8

MR. CARNEVALE:

-- exactly what you need? 9

MS. ARMSTRONG: I can probably give that to 10

you tomorrow. Sure. 11

MR. CARNEVALE: Do that through Frank? 12

MS. ARMSTRONG: Sure. 13

(Laughter.) 14

MALE VOICE: That is a hat you're wearing, 15

Fr ank. 16

MR. STANONIK: I noticed this. 17

MS. ARMSTRONG: Absolutely. 18

MR. BROOKMAN: Yes, Frank. 19

MR. STANONIK: Yeah. Frank Stanonik, AHRI. 20

Absolutely, Certainly, Ashley, we can give you the 21

additional backup. We have it and we'll give it to 22

you. 23

I think I mentioned we also have been 24

running comparative tests on all of our water heaters 25148

Heritage Reporting Corporation (202) 628

- 4888 in the residential program, so we will update the 1

information with whatever additional testing has 2

happened since we took the picture and as close as we 3

can to June 1 5. 4

MS. ARMSTRONG: Yeah, and, I mean, to Jeff's 5

point earlier, if you have specific units or designs 6

or new models that you've come out with since April, I 7

mean, clearly when we purchased them we were 8

purchasing models that probably were available prior 9

to April, right? So, if you have new models or if you 10

have new designs or if you have niches where you think 11

DOE should be testing these products or these specific 12

models should be included in the data set, we'll work 13

with you to make that happen, but we need to do that 14

now. We're willing to do that. 15

MR. BROOKMAN: Joe. 16

MR. BOROS: Let me just respond to that to 17

say that we have already submitted data to support 18

that effort. And we recognize we need to submit 19

additional data, but the timing is rather short. I 20

mean, we all have businesses to run and we're doing 21

different things, so we're going to make every effort 22

to submit data, but at least from our company's 23

perspective that really doesn't give us a lot of time 24

to do that. 25149

Heritage Reporting Corporation (202) 628

- 4888 MS. ARMSTRONG: As you know, it's a balance 1

between allowing more time to collect data versus, you 2

know, we do have an impending July compliance date 3

coming up for UED, and that's a statutory date, so we 4

also have a real need to get this done. 5

MR. HEALY: So

-- yeah, Amy, go a head. 6

MS. SHEPHERD: This is Amy Shepherd from 7

AHRI. But, I mean, in this rulemaking there's already 8

been statutory dates that have been missed, and so I 9

think from our perspective it's very important that 10

this be correct because this is how the standar d's 11

going to be set, in addition to all the other things. 12

So I think, you know, we just feel like we need to 13

push back on that a little bit because it's much more 14

important that this is correct, particularly given the 15

other things we talked about earlier today in terms of 16

this phase

- in period where up until May manufacturers 17

won't need to certify these units that have previously 18

been certified to this new metric. So I just can't 19

stress enough that getting the right data and getting 20

the right conversion fa ctor is essential not just for 21

the conversion factor but for the standard. 22

MS. ARMSTRONG: So that's a good lead

- in to 23

does anyone else have any closing remarks they'd like 24

to make at this time? 25150

Heritage Reporting Corporation (202) 628

- 4888 MR. STANONIK: I have those slides. 1

MS. ARMSTRONG: Do you want to go through 2

your slides? I mean, you're pretty much done. 3

MR. STANONIK: Yeah. No, I'd like to go 4

through the slides if I could. 5

MS. ARMSTRONG: Sure. 6

(Pause.) 7

MS. ARMSTRONG: Where do you want to start, 8

Frank? 9

MR. STANONIK: Actuall y, if you just go to 10

the first slide of the data because I can just talk to 11

the slides then. That one, yeah. Oh, yeah, that's 12

great. Good thing I passed it out. 13

Okay. So just to pick up

-- 14

MR. BROOKMAN: Let's stay focused, folks. 15

Thank you. 16

MR. STANONIK: Just to give you a quick 17

overview of what we thought we saw here and, first of 18

all, yeah, you'll probably need to look at what we 19

passed out, but let me just quickly note all of the 20

red numbers are places where the measured UEF in our 21

testing w as higher than the measured EF, and then the 22

blue numbers, the light blue numbers indicate where 23

the converted UEF which was by the calculation was 24

higher than the measured UEF. So that's what that's 25151

Heritage Reporting Corporation (202) 628

- 4888 about. 1

And the two yellow ones over there, those 2

are actually, if I'm remembering right, those are 3

models that are actually let's say pre

- April 2015 4

models because we started this testing the beginning 5

of the year. And what they're actually showing is 6

even though they're models that are non

- NAECA 3, I 7

think in at least one case if I'm looking at the right 8

one, they would have now become compliant I believe. 9

Or maybe it's just in this case on the gas. Maybe we 10

just identified a couple of non

- NAECA 3 models. 11

In any case, so what we're seeing from this 12

is t hat in the case of the gas, and this is all gas 13

storage, but in the case of the high usage models, it 14

appears that the measured UEF is consistently higher 15

than both the measured EF and the converted minimum 16

EF. And so, if nothing else, it suggests that ma ybe 17

the conversion number is off. But we're not seeing a 18

consistent relationship between the measured and 19

converted UEF values. 20

One of the things we're looking at is okay, 21

so if you have a better than minimum model, and let's 22

say it's five points better than the minimum, then 23

when things are converted that relationship should to 24

some extent be maintained. It doesn't have to be five 25152

Heritage Reporting Corporation (202) 628

- 4888 points. It will probably be some factor of that. But 1

the basic relationship, if the conversion factor is 2

accurate, should be maintained. So that's one of the 3

other things we've been trying to look at. And in 4

this case, what we're seeing is that we're not seeing 5

any consistent relationship between the difference 6

between the EF measured and the converted value, the 7

converted minimum value. 8

So again, if you look at one of these units. 9

Like let's say, okay, we had

-- well, let's go to the 10

fifth unit down. So we have a unit that was certified 11

at .67. We measured it at essentially .67. Its UEF 12

came out roughly 7.0, 6.99. O kay. And in this case 13

quite a bit above the converted minimum. And so this 14

product today is five points better than the minimum 15

standard, but when we looked at the converted stuff, 16

it's nine points better than the minimum, okay? And 17

again, if we were se eing that relationship hold 18

throughout this, we'd say oh, the conversion is 19

working. Okay? But there's not that consistency, and 20

so that's one of the things we're looking at. 21

And then similarly, and I short

- changed you 22

a little bit on the handouts. We just gave you the 23

data with the UEFs and the EFs. We did the same thing 24

for first

- hour ratings. We have those charts. 25153

Heritage Reporting Corporation (202) 628

- 4888 They've been submitted to DOE, they're on the docket, 1

but they're not reproduced here. This is bad enough 2

for your eyes. 3

MR. SACHS: Frank? 4

MR. STANONIK: Yeah. 5

MR. SACHS: I think I'm seeing up there and 6

on my copy some blue numbers as well. I don't think 7

we identified them. 8

MR. STANONIK: Oh, the blue ones are the 9

situation where the UEF determined by the calculation, 10

by the conversion calculation is higher than what we 11

measured. 12

MR. SACHS: Thank you. Sorry I was hard of 13

hearing. 14

MR. STANONIK: No, that's okay. 15

So anyhow, the last thing, and I mention it 16

because we're also not seeing any consistent 17

relationship between the respective measured first

-- 18

hour ratings, EF procedure, UEF procedure, nor between 19

the measured and converted first

- hour rating values. 20

Again, we're not seeing any consistency that would 21

suggest there's a mathematical relationship. 22

MS. ARMSTRONG: M ay I ask a more fundamental 23

question? 24

MR. STANONIK: Sure. 25154

Heritage Reporting Corporation (202) 628

- 4888 MS. ARMSTRONG: I'm not here to say we got 1

all this right, but do you really expect to see at the 2

end of the day a fundamental exact correlation between 3

the old test procedure and the new on al l models 4

across the industry from different people? 5

MR. STANONIK: The answer to that question 6

is no, we don't expect an exact correlation for all 7

models. 8

MS. ARMSTRONG: Right. That's impossible, 9

right? 10

MR. STANONIK: You're right. That's 11

impossib le and would take

-- well, it's just 12

impossible practically. 13

MS. ARMSTRONG: Right. 14

MR. STANONIK: Okay. But we do expect to 15

see a consistent relationship for most models, and 16

we're not seeing that. Again, to our point we think 17

part of this is again that we really didn't have 18

enough data to make

-- 19

MS. ARMSTRONG: I don't necessarily disagree 20

with you. I think generally speaking we are looking 21

to also look for consistent trends. But I think to 22

think that there's going to be a one to one and you're 23

not going to have things that are outside the bounds 24

is unreasonable. 25155

Heritage Reporting Corporation (202) 628

- 4888 MR. STEPHENS: Well, except, can I respond 1

to that, please? I think that generally means when 2

you find that situation to be the case that you 3

actually can't use a conversion factor. 4

MS. ARMSTRONG: Except for Congress requires 5

one. 6

MR. STEPHENS: Well, I realize that, but, 7

you know, there's this day of reckoning. 8

MS. ARMSTRONG: That's a different issue, 9

right? We are required to do one. It is what it is. 10

MR. STEPHENS: I kn ow, but the day of 11

reckoning comes a year from now or so

-- 12

MS. ARMSTRONG: Exactly. 13

MR. STEPHENS:

-- when everything has to be 14

tested and then the only thing that matters is the 15

tested numbers, and if they are radically different 16

than the converted n umbers in some cases and not 17

others, then you're just staving off the problem for a 18

year. 19

MS. ARMSTRONG: I don't necessarily 20

disagree. 21

MR. BROOKMAN: Amy? 22

MS. SHEPHERD: This is Amy Shepherd from 23

AHRI. But the other thing it requires is that the 24

co nversion factor not affect the efficiency of the 25156

Heritage Reporting Corporation (202) 628

- 4888 standard, and so I don't really necessarily want to 1

interrupt Frank's flow here, but I would like to have 2

very gently for a non

- engineer an explanation of like 3

the process that DOE used to verify that this i s in 4

fact neutral and that they met that statutory 5

requirement. 6

MR. SACHS: Excuse me, please, Amy. This is 7

Harvey. My memory, which isn't very good anymore, was 8

that nothing that was compliant under EF would be 9

rendered noncompliant by the UEF. Rathe r

-- 10

MS. SHEPHERD: Right. Like I said, gently 11

for a non

- engineer, like so there must have been

-- so 12

what were the steps in that determination? 13

MR. SACHS: But it doesn't require that we 14

have the same better than minimum for any particular 15

model. 16

M S. SHEPHERD: Well, the statute says it has 17

to be neutral and not have an affect. It doesn't say 18

neutral. It says it can't have an affect. 19

Now I grant you the one to one, but

-- so 20

I'm just interested in the process. DOE must have 21

looked at this and s aid okay, here's how we're 22

concluding that we met the statutory requirement of 23

being neutral, and I'm just looking for that 24

description, again, maybe perhaps with less math just 25157

Heritage Reporting Corporation (202) 628

- 4888 for me in under 10 minutes, just the process itself, 1

the steps that were taken . But sorry, Frank. 2

MR. SACHS: I'm just suggesting that I'm not 3

sure that we're defining neutral appropriately or too 4

narrowly in terms of what can be realistically 5

expected. 6

MR. BROOKMAN: Can someone answer Amy's 7

question? 8

MS. ARMSTRONG: Let's g o to Bruce for a 9

second. I will. 10

MR. BROOKMAN: Okay. Bruce. 11

MR. CARNEVALE: Bruce Carnevale. The 12

statute says the effect on efficiency requirements. 13

"The conversion factor shall not affect the minimum 14

efficiency requirements for covered water heat ers 15

otherwise established under this title." 16

MR. BROOKMAN: Thank you. 17

MR. CARNEVALE: And I would argue that that 18

was an impossible task for you guys. How do you do 19

that when you look at one for one? 20

MS. ARMSTRONG: So I think you saw our 21

method th at Bill presented with the yellow, green, the 22

yellow translated to the green with the line, which is 23

our mathematical way of trying to come up with a 24

standard, a new standard that we believe meets the 25158

Heritage Reporting Corporation (202) 628

- 4888 statutory criteria. Obviously we welcome comments to 1

t hat, but essentially what we've done is base it on 2

minimally complying units and it was to safeguard in 3

theory against that in a conservative way. 4

Now you could argue because we translated 5

ratings that if the rating translation is off from the 6

beginning because of lack of data or whatever that we 7

need to revise our ratings translations. But I'm not 8

sure you could come up with a

-- well, there are a 9

number of ways you could do this, but looking at the 10

minimally compliant and moving the deltas and running 11

a line through that minimally compliant is a way that 12

-- it's more or less the way you conservatively do 13

that from a mathematics standpoint. 14

MR. BROOKMAN: A follow

- on, Amy. 15

MS. SHEPHERD: Not on a model basis, though. 16

I mean, I get a percentage of th e standard. I was 17

talking more about about when you developed the 18

conversion factor, and so you had your tested EF and 19

you had your tested UEF and you had your conversion 20

factor. What was that process? 21

MS. ARMSTRONG: Well, I mean, what he just 22

read wa s the standard, was the section relevant to the 23

standard, and so that's what I was addressing. 24

MR. BROOKMAN: Deriving the equation. 25159

Heritage Reporting Corporation (202) 628

- 4888 MS. ARMSTRONG: Exactly. How do you derive 1

a standard equation. So

-- 2

MR. BROOKMAN: Charlie. 3

MR. STEPHENS: I me an, I know it's late, 4

it's really late in the process here, and I agree with 5

Amy about, you know, let's get it right if we can 6

anyway. But it seems to me that the chore here, the 7

impossible task as you called it, was to match 8

mathematics to reality. And I don't think if you're 9

in the process of deriving your mathematics, not using 10

real numbers, you will never match mathematics to 11

reality. 12

If you're not using the real, the actual 13

volume of water in the tank, if you're not using the 14

actual temperatures in the tank, if you're not using 15

those things to do your mathematics, then you will 16

never get reality to match up with your models. And 17

I'm not giving up on being able to do that better. I 18

think, you know, if you got some of those things right 19

you actually might get better concurrence between your 20

conversion and your measured for any given water 21

heater, but I don't know the individual 22

characteristics of the water heaters, so I can't 23

really help you with that. 24

But the thing is, if you don't do that, 25160

Heritage Reporting Corporation (202) 628

- 4888 there will be, like I say, a day of reckoning where a 1

year from now, when everybody actually has to measure 2

it, that some units under the conversion factor that 3

you carefully constructed will not meet the standard. 4

MS. ARMSTRONG: I think like in response to 5

a ll these comments, in response to the discussion, in 6

response to data, we will go back and look at 7

everything. 8

I mean, when Bill explained what we did for 9

the conversion for ratings, it was measured value. So 10

there was a difference between the rating va lues, and 11

those are also comparing tested values, single unit 12

test to single unit test measurements. That's 13

different than what we did for standards, which is 14

converting ratings, converting rated values using 15

conversion equations that were developed base d on 16

tested values. So some of your points have been well 17

taken, but I think some of them were actually already 18

done. 19

So like I said, we're going to go back and 20

look at all this holistically and hopefully, you know, 21

in conjunction with you guys we can c ome up with a 22

revised analysis, but at the end of the day I think 23

our methods generally hold. So that's kind of where 24

we are. Do you want to keep going? 25161

Heritage Reporting Corporation (202) 628

- 4888 MR. BROOKMAN: All right. Frank, yeah, keep 1

going. 2

MR. STANONIK: All right. So then still on 3

t his one, and as far as the medium usage, products in 4

the medium usage bin, again, we have questions about 5

the UEF measured is consistently lower

-- now in this 6

case, let me rephrase that. 7

In the case of the medium usage, the 8

measured UEF is consistently lower than the measured 9

EF. The opposite was in the case of the high bin. 10

And that may be related to the difference between 11

testing at 55 gallons versus 64. Maybe. 12

But we're also again not seeing any 13

consistent relationship between the measured and th e 14

converted UEF values. Again, if the conversion as we 15

look at it is accurate, and again, not perfect, but 16

there should be some discernible relationship that you 17

can say it's when X plus or minus something, between 18

those two values. 19

Similarly, in the ca se of the measured 20

first

- hour rating values using the UED procedure, 21

those come out less than the current measured first

22

hour rating, but again, no consistent relationship 23

between the measured and the converted UED first

- hour 24

rating values. 25162

Heritage Reporting Corporation (202) 628

- 4888 All that is j ust causing us to say those 1

conversion factors or calculations just don't seem to 2

fit or the data's saying it doesn't fit. 3

And before we leave this one let me

-- I 4

will correct this now that I'm looking at my own 5

paper. Those yellow ones in fact are mod els today 6

that cannot be manufactured. They're lower than NAECA 7

3 minimums. But if you look at the result, if they 8

were run to the new test, they would have higher 9

ratings and in fact they would exceed the converted 10

minimum and they could be made. So in fact you've 11

brought in

-- this proposal would bring in models that 12

currently have been taken off the market because of 13

NAECA 3. 14

So let's go to the next slide if we can, 15

which is going to be the data for tankless models or 16

instantaneous, whichever. We'l l call them tankless. 17

Same pattern on the numbers as far as what the colors 18

mean. 19

In this case, probably the two big things 20

we're seeing is that the same issues, we're just not 21

seeing the relationship between the measured EF and 22

the measured UEF. It se ems to be inconsistent. And 23

then likewise, the relationship between the measured 24

and the converted UEF values, it doesn't seem to be 25163

Heritage Reporting Corporation (202) 628

- 4888 let's say jumping out at us. We're just not seeing 1

how that's working. 2

In this case, we really didn't talk about it 3

I t hink, but with tankless, the next one, GPM, which 4

pretty much are not there because it's pretty 5

straightforward. If you're heating over a 77 degree 6

rise, you're going to get a certain GPM. If you're 7

heating over a 70 degree rise or 67 degree rise, your 8

G PM just goes up, it's proportional. So that's pretty 9

straightforward. I don't think there's much problem 10

there. 11

So then we can go to the next slide, which 12

is the electric. Now, in this case, first of all, 13

this electric storage, we're including both th e 14

resistance and heat pump products, and what we're 15

seeing here is that the measured UEF is usually lower 16

than the measured EF, certainly for electrical 17

resistance products, and the measured UEF is less than 18

both the converted minimum UEF standard and the 19

converted UEF. 20

So, if you look at the last column here and 21

if you look at just the electric resistance, all the 22

models that have a negative there which is the 23

difference between the measured UEF and the minimum

-- 24

I'll rephrase that. 25164

Heritage Reporting Corporation (202) 628

- 4888 All those units wo uld indicate right now 1

they're not hitting the minimum or at least suggest 2

they're not hitting the minimum. They've come in 3

below the converted minimum. And so that's part of 4

our concern that, again, the conversion certainly when 5

it comes to electrics is over

-- is not converting the 6

minimum standard properly. It's in fact increasing 7

the stringency. 8

MR. BOROS: Frank, you may want to point out 9

the low bin is especially impacted. There's only two 10

data points there, but the low bin is really off to 11

elec tric resistance models. 12

MR. STANONIK: Yeah. As far as the minimum 13

absolutely, because you're going from testing an 14

electric water heater that was providing 64 gallons to 15

providing 38 gallons, and there should be a

-- well, 16

the tests show there is a hug e difference in the 17

measured UEF. You know, you can predict that without 18

ever running the test because you just changed how 19

long the resistance

-- 20

MR. STEPHENS: And the temperature too. 21

MR. STANONIK: A third less, right? More 22

than a third less. Al most a half less. Yeah. 23

So, as Joe said, in the low ones it's 24

particularly I would say obvious that the converted 25165

Heritage Reporting Corporation (202) 628

- 4888 minimums is to o high. 1

And then in the case of the heat pumps, 2

again, the difference between the measured UEF and the 3

measured

-- 4

MS. AR MSTRONG: No, go back. 5

MR. STANONIK: Yeah, it's still there. 6

Is this the electronic equivalent of the 7

hook that comes and drags you off the stage or

-- all 8

right. So, in the case again with the heat pumps, 9

we're just seeing inconsistent results betwe en the 10

measured EF and the measured UEF, and as one of our 11

members pointed out, yeah, we actually have some 12

higher efficiency heat pumps, you know, 3.1 or 13

whatever, and we think, again, that's an area DOE 14

probably could look at some more models, and hopefu lly 15

we can get some more models too. 16

All right. And then the last

-- that is the 17

last slide I think. Oh, no. Residential duty. Okay. 18

No. How could I forget residential duty? Yeah. 19

This one, it actually is pretty significant. Let me 20

flip my notes here. 21

So, in all of these, not surprisingly, a 22

high usage bin, and the measured UEF is higher than 23

what the calculation would convert the UEF to in all 24

cases, and it looks like the magnitude of the 25166

Heritage Reporting Corporation (202) 628

- 4888 difference actually has some relationship to a 1

combinat ion of the thermal efficiency of the model and 2

the smaller volume. 3

But the biggest thing here again is all the 4

UEF measured values are quite a bit above what the 5

calculation is, which if you want to, you know, in a 6

sense

-- well, that's really saying the converted 7

calculation is underestimating what these models will 8

test out at when you do the UEF test, which one could 9

say is reducing the standard I guess if you want to 10

look at it that way. 11

MR. STEPHENS: You don't have the thermal 12

efficiency

-- 13

MR. STANONIK: We have that data, yeah, 14

measured in. They'll get it. 15

You know, I can answer some other questions 16

if you have them about our data here, but as DOE said, 17

we certainly have additional information that we can 18

provide to help you do the analysis. 19

The other thing I will

-- well, two things, 20

since we're trying to conclude here I think. Two 21

things. We still very much want a direct answer on 22

the question of, I have models certified to DOE today 23

that meet the April 15 standard. Units of those 24

mode ls manufactured after July 13, are they considered 25167

Heritage Reporting Corporation (202) 628

- 4888 to comply with the converted UEF standards? 1

MS. ARMSTRONG: What's the other thing you 2

want to know? 3

MR. STANONIK: Well, the other thing is 4

again, I mean, in concluding, we still think that that 5

July 13 date has to move because we don't see how you 6

can get the conversion factor final rule done in time, 7

and as I think Amy said, we believe that it certainly 8

is not locked in stone that it has to be July 13. I 9

know the statute says, but things have slid i n the 10

past and we think the best solution would be that the 11

implementation, the revised FTC labels would coincide 12

with the effective date of the new test procedure. Is 13

that accurate? 14

MR. BROOKMAN: Karen? 15

MS. MEYERS: Can DOE staff give us an update 16

o n where they're at in a response to the AHRI petition 17

on rated volume? 18

MS. ARMSTRONG: Sure. We have gotten the 19

comments. We are still considering the comments. We 20

have not taken the next action, whatever that will be. 21

We are still trying to decide e xactly what our next 22

action is going to be. And so that's the current 23

status update. 24

MR. STANONIK: Is there a schedule set? 25168

Heritage Reporting Corporation (202) 628

- 4888 MS. ARMSTRONG: There's not a definitive 1

schedule set. I know that there are active 2

discussions that have been ongoing and ar e ongoing 3

right now. 4

MR. BROOKMAN: Any additional final 5

comments, closing remarks as we move toward closure 6

here? Joe? 7

MR. BOROS: I just have one question. It's 8

Joe Boros. AHRI submitted data which I believe, 9

Frank, this is more than 100 sets of d ata, so it 10

represents more data than what was used to establish 11

the NOPR. What's DOE going to do with this data? Are 12

they going to recalculate and provide additional 13

feedback to us? What's the next steps and process 14

with the data? 15

MS. ARMSTRONG: So w e're definitely going to 16

use the data. I think as a first level we need some 17

additional information from you guys. So first off, 18

I'll provide a template to Frank. Hopefully tomorrow 19

he can disseminate that to you guys and get it back to 20

us hopefully nex t week? I mean, it shouldn't be that 21

difficult, right? 22

MR. STANONIK: Yes. Yep, yep. 23

MS. ARMSTRONG: And so yes, we're going to 24

include that data in our re

- analysis. 25169

Heritage Reporting Corporation (202) 628

- 4888 I think what's important to us, Frank, 1

something to note is it was hard for us to tell if you 2

were testing some units more than once in the data set 3

you submitted or if they were distinctly all different 4

units. The reason for that is because, at least of 5

the three characteristics you gave us, they were 6

identical. So it was hard for us to tell if they were 7

all completely different models or if they were, you 8

know, models that were the same basic models but 9

slightly different in non

- efficiency attributes. So 10

that's the type of stuff I think some of these 11

additional characteristics would get to or if they 12

were just the same unit tested multiple times. 13

MR. STANONIK: Right. Okay. 14

MS. ARMSTRONG: But long story short, we are 15

going to revise the analysis. Now whether we're going 16

to put that analysis out for additional comment or 17

whethe r we're going to go final with it, I don't think 18

we know yet. It depends on what that whole re

19

analysis process, what it shows. 20

That being said, if you guys as an industry 21

and other entities would like an additional 22

opportunity to discuss things with us or continue that 23

dialogue, I think we can find a way to do it, but it 24

needs to be in a pretty timely manner. 25170

Heritage Reporting Corporation (202) 628

- 4888 MR. STANONIK: Frank Stanonik, AHRI. Just 1

quickly in answer to that question, certainly the 2

tests that were done as part of our program signal 3

test unit. We mixed in data members provided. Some 4

of that might be repetitive tests on the same model or 5

same unit. We'll identify them. 6

MS. ARMSTRONG: And I think some of them are 7

also going to be units that we tested. So I know that 8

you may not s hare manufacturer model

- specific 9

characteristics, but I will say to the extent that 10

manufacturers want to better understand if we tested 11

some of their specific products and what those results 12

might be, we have ways of disclosing that that are not 13

part of t he public record, because we're not going to 14

put full test reports in the document on every unit we 15

tested. But it would go two ways. You would have to 16

be willing to also share with us that data on that 17

specific unit. 18

MR. BROOKMAN: Harvey. 19

MR. SACHS : Several things I want to say in 20

closing remarks. First of all, I think all of us owe 21

each other a bit of an apology that everyone involved 22

in the sausage

- making for AEMTCA probably 23

underestimated the effort that would be required to do 24

this conversion process. I realize that points 25171

Heritage Reporting Corporation (202) 628

- 4888 fingers back at some of us on the advocate side as 1

well as some manufacturers and others. 2

In that context, I really want to say how 3

much I appreciate all the hard work that both DOE 4

consultants and manufacturers with AHRI have done to 5

try to get this right. 6

With those things said, it seems to me that 7

there are two paths forward, and I haven't been able 8

to think of a third path that would be at all 9

responsive to the time demands, the effort demands, 10

and everything else tha t everyone is under. 11

One of them is a process we've spent a lot 12

of time on today, which is to keep massaging, keep 13

trying to reduce the variability and understand the 14

anomalies in the conversion process, to get a single 15

representation which clearly would be an ideal thing 16

for consumers. 17

The other path, which I think may be 18

possible, but I could be wrong, is say okay, this is a 19

transition time between now and next year in May. The 20

least confusion might be to allow continued 21

representation in EF and TE u nits for existing models 22

and require UEF for all models certified after the 23

date certain, July 13, recognizing that this will mean 24

there are two labels out there. There is the 25172

Heritage Reporting Corporation (202) 628

- 4888 possibility of confusion, but it will go away. And it 1

may be the least bad app roach that is available to us 2

now. 3

So I'm just suggesting that we might have a 4

choice and it might be that that's the less painful 5

choice. ACEEE does not endorse that position at this 6

time. 7

(Laughter.) 8

MR. BROOKMAN: Final comments? 9

(No response.) 10

MR. BROOKMAN: Okay. Then turning it back 11

to Ashley for how to submit written comments. 12

MS. ARMSTRONG: So you guys all know how to 13

submit written comments at this point in time. The 14

comment period closes on June 15. I don't think DOE 15

plans to exte nd that further at least as of now. 16

That being said, we would like to thank you 17

guys for coming today and participating and for all 18

the feedback. We will work hard to do some revisions 19

to the analysis and see where that lands us. So safe 20

travels home. 21

MR. BROOKMAN: Thank you all. 22

ALL: Thanks. 23

(Whereupon, at 1:44 p.m., the meeting in the 24

above

- entitled matter was concluded.) 25173 REPORTER'S CERTIFICATE

DOCKET NO.: N/A

CASE TITLE: The Test Procedures for Residential and

Certain Commercial Water Heaters

--

Conversion Factors Rulemaking Meeting

HEARING DATE: May 28, 2015

LOCATION: Washington, D.C.

I hereby certify that the proceedings and

evidence are contained fully and accurately on the

tapes and notes reported by me at the hearing in the

above case before the U.S. Department of Energy,

Office of Energy Efficiency & Renewable Energy.

Date: May 28, 2015

Linda D. Official Reporter Heritage Reporting Corporation Suite 206 1220 L Street, N.W. Washington, D.C. 20005-4018

Heritage Reporting Corporation (202) 628-4888