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**202-234-4433 Neal R. Gross and Co., Inc.**  **U.S. DEPARTMENT OF ENERGY**

**+ + + + + ENERGY CONSERVATION STANDARDS:**  **NOTICE OF PROPOSED RULEMAKING FOR AUTOMATIC COMMERCIAL ICE MAKERS** 

**+ + + + + PUBLIC MEETING** 

**+ + + + + MONDAY**  **APRIL 14, 2014**

**+ + + + +**

**The Public Meeting met in Room 8E-089, 1000 Independence Avenue SW,**  **Washington, D.C., at 9:00 a.m., Doug Brookman, Meeting Facilitator, presiding.**  **PRESENT: DOUG BROOKMAN, Meeting Facilitator, Public**  **Solutions, Inc. JOHN CYMBALSKY, Department of Energy**  **FRANCINE PINTO, Department of Energy DOUG RAWALD, Department of Energy** 

**ALSO PRESENT:**

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**202-234-4433 Neal R. Gross and Co., Inc.**  **KARIM AMRANE, AHRI BEN BARRINGTON, Navigant Consulting, Inc.**  **SCOTT BINGHAM, Follett Corporation JAVIER BURGOS, Navigant Consulting, Inc.**  **ALAN COOKE, Pacific Northwest National Laboratory**  **SCOTT DeSHETLER, Ice-O-Matic DARYL ERBS, Manitowoc Foodservice**  **TOM LASECKI, Scotsman Ice Systems FRANK MOORE, North American Association of**  **Food Equipment Manufacturers MICHELLE NIEMEYER, Pacific Northwest National**  **Laboratory CHRIS NITZ, Danfoss LLC**  **GEORGE PARSONS, Ice-O-Matic LAURA PETRILLO-GROH, AHRI**  **CRAIG RANEY, Emerson Climate Technologies HOWARD RICKETTS, Ice-O-Matic**  **CHRIS SALATINO, Scotsman Ice Systems STEVEN SCHAEFER, Hoshizaki America, Inc.**  **LOUIS STARR, Northwest Energy Efficiency Alliance**  **RON SOBAN, Greenfield Worldtrade DETLEF WESTPHALEN, Navigant Consulting, Inc.**  **ROBERT WILKINS, Danfoss, Inc. MARK WUTTKE, Scotsman Ice Systems** 

**TABLE OF CONTENTS**

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**202-234-4433 Neal R. Gross and Co., Inc.**  **Welcome, Introductions, Opening Statements**  **......................... 4 Overview, scope Market and Technology**  **Assessment, Screening Analysis ............. 8 Engineering Analysis**  **....................... 96 Markup Analysis, Energy Use, Life-Cycle**  **Cost and Payback Period Analysis ......... 108**  **Markup Analysis, Energy Use, ............. 180 Life-Cycle Cost and Payback**  **Period Analysis (continued) Shipments, National Impact ............... 230**  **Analysis, Regulatory Impact Analysis**  **Manufacturer Impact Analysis ............. 247 Emissions Analysis, Utility .............. 324**  **Impact Analysis, Employment Analysis**  **TSLs ....................................... 335 Closing Remarks ........................... 355** 

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**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### P-R-O-C-E-E-D-I-N-G-S **2** 

### 9:10 a.m. **3** 

### MR. BROOKMAN: Okay, let’s begin and **4** 

### hopefully the Internet connection is with us **5** 

### here. **6** 

### Good morning everyone. Welcome. **7** 

### This is the Appliance Standards meeting this **8** 

### Energy Conservation Standards Notice of **9** 

### Proposed Rulemaking for automatic commercial **10** 

### ice makers. Today is April 14, 2014 here in **11** 

### the Forrestal Building in Washington, D.C. and **12** 

### my name is Doug Brookman from Public Solutions **13** 

### in Baltimore. **14** 

### We’re going to start with welcoming **15** 

### remarks from John Cymbalsky. **16** 

### MR. CYMBALSKY: Thanks, Doug. **17** 

### I’m John Cymbalsky, I’m the Program **18** 

### Manager for Appliance Standards here at the **19** 

### Department and let me welcome you to the **20** 

### meeting. **21** 

### I’ll just say briefly, we’ve **22** 

### received a lot of interest in this meeting

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**202-234-4433 Neal R. Gross and Co., Inc.**  **1 which I think is very good that people are 2 paying attention and commenting on what we’ve**  **3 done so we appreciate that. 4 And I said it a little bit ago, but**  **5 it’s going to get very warm in this room, so 6 you won’t be offending anybody by being a**  **7 little more casual in the room to be 8 comfortable. We’re going to be here a while,**  **9 so might as well dig in and get comfortable. 10 Thank you.**  **11 MR. BROOKMAN: Okay. We always 12 start with introductions around the room.**  **13 You can get used to turning these microphones 14 on and off. The little green diode or**  **15 whatever that is gets illuminated when it‘s 16 on. Yes.**  **17 Name and organization or 18 affiliation.**  **19 MR. BINGHAM: Scott Bingham, 20 Follett Corporation.**  **21 MR. PARSONS: George Parsons, 22 Ice-O-Matic.** 

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**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### MR. ERBS: Daryl Erbs, Manitowoc **2** 

### Food Service. **3** 

### MR. NITZ: Good morning, Chris Nitz, **4** 

### Danfoss. **5** 

### MR. RANEY: Craig Raney, Emerson **6** 

### Climate Technologies. **7** 

### MR. SCHAEFER: Stephen Schaefer, **8** 

### Hoshizaki America. **9** 

### MR. SOBAN: Ron Soban, Kold-Draft. **10** 

### MR. MOORE: Frank Moore with NAFEM. **11** 

### MS. PETRILLO-GROH: Laura **12** 

### Petrillo-Groh, AHRI. **13** 

### MR. STARR: Louis Starr, Northwest **14** 

### Energy Efficiency Alliance. **15** 

### MR. DELASKI: Andres deLaski, **16** 

### Appliance Standards Awareness Project. **17** 

### MR. SALATINO: Chris Salatino, **18** 

### Scotsman Ice Systems. **19** 

### MS. PINTO: Francine Pinto, Office **20** 

### of General Counsel, Department of Energy. **21** 

### MR. RAWALD: Doug Rawald, **22** 

### Department of Energy’s Office of General

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**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### Counsel. **2** 

### MR. BURGOS: Javier Burgos, **3** 

### Navigant Consulting. **4** 

### MR. WESTPHALEN: Detlef Westphalen, **5** 

### Navigant Consulting, did that work? **6** 

### MR. BROOKMAN: No, I don’t think so. **7** 

### It goes in and out in that spot. **8** 

### MR. WESTPHALEN: Detlef Westphalen, **9** 

### Navigant Consulting. **10** 

### MR. BARRINGTON: Ben Barrington, **11** 

### Navigant Consulting. **12** 

### MR. COOKE: Alan Cooke, Pacific **13** 

### Northwest National Laboratory. **14** 

### MS. NIEMEYER: Michelle Niemeyer, **15** 

### Pacific Northwest National Laboratory. **16** 

### MR. RICKETTS: Howard Ricketts, **17** 

### Ice-O-Matic. **18** 

### MR. DESHETLER: Scott DeShetler, **19** 

### Ice-O-Matic. **20** 

### MR. LASECKI: Tom Lasecki, Scotsman **21** 

### Ice Systems. **22** 

### MR. WUTTKE: Mark Wuttke, Scotsman

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**202-234-4433 Neal R. Gross and Co., Inc.**  **1 Ice Systems. 2 MR. WILKINS: Robert Wilkins,**  **3 Danfoss. 4 MR. BROOKMAN: Did everyone get a**  **5 chance to introduce him or herself? 6 All of you received a packet of**  **7 information when you came in this morning. 8 There’s an agenda on Page 2. I’m going to go**  **9 through that very briefly. 10 Immediately following this agenda**  **11 review, we’re going to hear a little more 12 content, detailed comment from John Cymbalsky**  **13 and then following John, an opportunity for 14 opening statements, brief summary statements**  **15 here at the outset, issues that matter to you 16 surrounding this rule making.**  **17 We’ll move from there directly into 18 the content laden packet you have in front of**  **19 you. Overviews, scope, market and technology 20 assessments, screening analysis.**  **21 We’ll take a break mid-morning 22 around about 10:15 or so.** 

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**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### Following that, engineering **2** 

### analysis and proceeding directly marked up **3** 

### analysis, energy use, life-cycle costs and **4** 

### payback period analysis. **5** 

### We’ll take lunch around about noon **6** 

### today. **7** 

### Returning from lunch, shipments, **8** 

### national impact analysis, regulatory impact **9** 

### analysis and then directly manufacturer **10** 

### impact analysis and missions analysis, **11** 

### utility impact analysis, employment analysis. **12** 

### We’ll take a break mid-afternoon **13** 

### around about 2:00 or so. **14** 

### And then following the mid-afternoon **15** 

### break, or whenever we get there, the content **16** 

### on proposed standards themselves. **17** 

### And as you can see in the agenda, **18** 

### closing remarks at the end of the day. At the **19** 

### end of the day, yet another opportunity for **20** 

### anybody that wishes to raise additional issues **21** 

### that haven’t been covered sufficiently. **22** 

### Another opportunity right there. Okay?

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**202-234-4433 Neal R. Gross and Co., Inc.**  **1 I’d ask for your consideration, 2 please, if you’d speak one at a time today.**  **3 Everybody’s gotten used to turning these 4 microphones on and off, please try and get them**  **5 close to your face so we can capture a complete 6 record of this meeting.**  **7 Please say your name each time you 8 speak. There’ll be a complete transcript of**  **9 the meeting made available. If you can be 10 concise and share the air-time. Keep the**  **11 focus here. If your cell phones are not on 12 silent or off at this point, please turn them**  **13 on silent. Limit sidebar conversations. 14 And webinar participants, we welcome**  **15 you. We’re happy that you could join us via 16 the web. The Department of Energy’s trying**  **17 hard to make these meetings very accessible to 18 all.**  **19 If you would keep your telephones on 20 mute, it will diminish the feedback we receive**  **21 here in the room and you can raise your hand 22 in the software that we’re using to be** 

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**202-234-4433 Neal R. Gross and Co., Inc.**  **1 recognized and, hopefully, we’ll be able to 2 hear you in the room. You ought to be able to**  **3 speak and we ought to be able to hear you. And 4 if not, we’ll find a way to get messages passed**  **5 back and forth to the webmaster here and we’ll 6 get you included in this conversation.**  **7 So that’s all the preliminary stuff 8 from me.**  **9 To John Cymbalsky. 10 MR. CYMBALSKY: Thank you, Doug.**  **11 John Cymbalsky, DOE. 12 So the Department and, in fact, the**  **13 entire United States Government, because I’ll 14 speak on behalf of a couple different agencies**  **15 here, understands the issues with R-404A and 16 the refrigerant that you use for these**  **17 products. 18 I understand that EPA has a**  **19 rulemaking underway in terms of deciding which 20 end uses to delist, or not delist for that**  **21 particular refrigerant. 22 I just want to assure everybody in** 

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**202-234-4433 Neal R. Gross and Co., Inc.**  **1 the room that the agencies are talking to one 2 another. Both agencies understand the**  **3 importance of R-404A for this product. 4 While I can’t say what EPA’s going to**  **5 do, I can tell you at the highest levels of the 6 Government, because I talk to people who are**  **7 sort of overseeing both of us in this area, 8 that they understand the issue with this. So**  **9 I just want to say up front that I don’t want 10 to mitigate your concerns because, obviously,**  **11 you should be concerned. 12 All I want to say is that we**  **13 understand it. The standard that we 14 eventually will proceed with here will be**  **15 refrigerant neutral in any way that it can. 16 And I point to what we wrote in the preamble**  **17 for the final rule for commercial 18 refrigeration equipment where we stated**  **19 explicitly that if refrigerants became an 20 issue, there would be a process to get relief**  **21 from these standards. And so, we plan on 22 going forward with that with this rule as well.** 

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**202-234-4433 Neal R. Gross and Co., Inc.**  **1 And so, the reason I bring this up is 2 because I don’t want this to become a**  **3 refrigerant meeting. That’s not what this is 4 about. You will have your chance to comment**  **5 on whatever EPA says over the summer with 6 respect to the refrigerant for this product.**  **7 I just want to say up front that DOE 8 and EPA and the Administration, all three,**  **9 understand the importance of that particular 10 refrigerant for this product. So feel free to**  **11 comment on that but please, if you want to make 12 that comment, please make it brief or submit**  **13 it in writing and we will, obviously, include 14 it in the final rule.**  **15 But again, I don’t want this meeting 16 to be about 404A not being available so that**  **17 this whole body of work in front of you is 18 irrelevant because that’s not the case and we**  **19 don’t want this meeting to become about that. 20 A few other topics people have talked**  **21 about, I received some communications about 22 can we negotiate a final rule? Given that** 

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**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### we’ve put this proposal out and all I’ll say **2** 

### is, you know, DOE has put out a proposal and **3** 

### whether or not there’s room or the want to **4** 

### negotiate around this, you know, you know, the **5** 

### Department’s always open to ideas about that. **6** 

### But other than that, please let’s **7** 

### focus on the material that’s in the NOPR and **8** 

### I think, as always, your public comment is **9** 

### what’s going to form the final rule. So we **10** 

### appreciate that. And let’s have a very **11** 

### productive meeting. **12** 

### Thank you. **13** 

### MR. BROOKMAN: Thank you. **14** 

### As we had said at the outset, an **15** 

### opportunity for opening remarks. Laura? **16** 

### MS. PETRILLO-GROH: Good morning. **17** 

### My name is Laura Petrillo-Groh. I am the **18** 

### Engineering Manager of Regulatory Affairs at **19** 

### Air Conditioning, Heating and Refrigeration **20** 

### Institute. **21** 

### AHRI is a trade association **22** 

### representing 350 manufacturers of heating,

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**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### cooling, water heating and commercial **2** 

### refrigeration equipment. **3** 

### In the United States alone, AHRI’s **4** 

### members employ approximately 130,000 people **5** 

### and support some 800,000 dealers, contractors **6** 

### and technicians. Seven of AHRI’s members **7** 

### manufacture automatic commercial ice makers **8** 

### in the United States. **9** 

### DOE estimates that those seven **10** 

### companies account for approximately 95 **11** 

### percent of all commercialized ice makers sold **12** 

### in the United States. **13** 

### We appreciate the opportunity to **14** 

### comment on the DOE Notice of Proposed **15** 

### Rulemaking on the Energy Conservation **16** 

### Standards for Automatic Commercial Ice **17** 

### Makers. However, we have several pressing **18** 

### concerns that need to be addressed before this **19** 

### regulation goes into effect. **20** 

### There are significant issues in the **21** 

### analysis and the current direction of this **22** 

### rulemaking will place significant burden on

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**202-234-4433 Neal R. Gross and Co., Inc.**  **1 the industry. The completion of this 2 rulemaking under the current process will be**  **3 difficult or require the expenditure of 4 considerable resources by the DOE and the**  **5 industry and will likely not be implemented in 6 a timely fashion.**  **7 We believe that a final rule for ACIM 8 equipment can be developed more quickly and**  **9 more efficiently through a negotiated 10 rulemaking process. We request that a**  **11 commercial ice maker working group be 12 established through ASRAC to negotiate a**  **13 revised efficiency standard for ACIM. 14 Thank you, John, for acknowledging**  **15 the Department’s commitment to creating a 16 refrigerant neutral rule. Not only will SNAP**  **17 ban R-404A, it’s also looking at 1R134A which 18 these refrigerants are used in all commercial**  **19 ice makers. 20 While the DOE cannot be expected to**  **21 speculate on the final rules that will result 22 from the SNAP rulemakings, the burden that** 

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**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### will be imposed on the ACIM manufacturer by **2** 

### regulations will cause them to change **3** 

### refrigerants is significant and will require **4** 

### a major redesign just to maintain current **5** 

### efficiency levels. **6** 

### This burden must be accounted for in **7** 

### the rulemaking. In particular, the **8** 

### engineering analysis for ACIM efficiency **9** 

### rulemaking should reflect the use of **10** 

### alternative refrigerants instead of current **11** 

### Commercial refrigerants. **12** 

### DOE cannot simply estimate the cost **13** 

### -- **14** 

### OPERATOR: Star one to allow all **15** 

### attendees to hear you. This system will **16** 

### notify you once you begin your broadcast. **17** 

### MR. BROOKMAN: Keep going. **18** 

### MS. PETRILLO-GROH: DOE cannot **19** 

### simply estimate the cost effectiveness of new **20** 

### energy conservation standards and the energy **21** 

### savings over a 30 year period based on **22** 

### equipment designs that use refrigerants that

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**202-234-4433 Neal R. Gross and Co., Inc.**  **1 will unlikely be around three years from now. 2 Since the --**  **3 OPERATOR: The broadcast is now 4 starting. All attendees are in listen only**  **5 mode. 6 MS. PETRILLO-GROH: Since the**  **7 alternative refrigerants will not be known 8 until the next SNAP rollout is completed. DOE**  **9 should put a hold on the ACIM standards 10 rulemaking.**  **11 A three year compliance period is not 12 adequate for this rulemaking given the**  **13 severity of the proposed rule. It is more 14 severe than the related change that was**  **15 imposed by the January 2010 final rule and the 16 scope of the proposed rule has expanded**  **17 considerably. 18 Further, a three year period is**  **19 inadequate for manufacturers to obtain more 20 efficient components from suppliers to meet**  **21 proposed revision of standards. 22 The DOE has underestimated the cost** 

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**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### efficiency approving design options and **2** 

### overestimated the energy savings. Section **3** 

### 5.9.2 of the technical support document claims **4** 

### that for a ten percent increase in EER, this **5** 

### relationship yields a five percent increase in **6** 

### costs consistent with the approach used for **7** 

### the CRE rulemaking. **8** 

### This is not consistent with the **9** 

### approach as described in the final CRE **10** 

### rulemaking. **11** 

### There is significant concern about **12** 

### DOE’s assumptions regarding the advances in **13** 

### compressor technology anticipated before the **14** 

### compliance date. If a ten percent compressor **15** 

### efficiency improvement were possible for a **16** 

### five percent cost increase, then it is most **17** 

### likely that manufacturers would have already **18** 

### adopted this technology. **19** 

### During the CRE rulemaking, DOE **20** 

### received comments on this specific item. In **21** 

### the CRE final rule, DOE implemented the **22** 

### suggestion of Danfoss, a major supplier

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**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### present today, which stated that a two percent **2** 

### increase in performance over today’s **3** 

### standards offerings with the corresponding **4** 

### cost increase of five percent is attainable. **5** 

### The DOE needs to update its **6** 

### performance and cost modeling of compressors **7** 

### and provide adequate time for comments prior **8** 

### to publishing a final rule. **9** 

### There is significant concern that **10** 

### thorough testing has not been conducted to **11** 

### validate the calculated efficiency gain from **12** 

### design options. The engineering analysis **13** 

### treats the efficiency gains and costs for **14** 

### implementing each successive design option as **15** 

### a purely additive. **16** 

### Just as manufacturers are expected **17** 

### to validate and prove AEDMs, the DOE should **18** 

### validate and prove out claims made in the **19** 

### engineering analysis. **20** 

### For example, DOE references two **21** 

### IMH-A-Small-B ice makers that are currently **22** 

### available on the market but have different

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**202-234-4433 Neal R. Gross and Co., Inc.**  **1 design options. The difference in efficiency 2 for these two machines is 15 percent. But**  **3 when DOE applies the same design options in 4 their model, the predicted reduction in energy**  **5 use is 23.5 percent. This is incorrect and 6 needs to be reevaluated.**  **7 AHRI looks forward to working with 8 the Department and others in establishing a**  **9 workable and credible energy conservation 10 standards for ice makers.**  **11 Thank you for the opportunity to 12 present our views. We will provide more**  **13 detailed comments in writing. 14 MR. BROOKMAN: Thank you.**  **15 Additional comments here at the 16 outset? Daryl?**  **17 MR. ERBS: Good morning. I’d like 18 to first off, my position is Vice-President of**  **19 Technology with Manitowoc Foodservice. We 20 manufacture and sell Commercial ice machines**  **21 under the Manitowoc and other brands. 22 In terms of my opening comments, I’ll** 

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**202-234-4433 Neal R. Gross and Co., Inc.**  **1 leave the refrigerant issue aside but in terms 2 of just overall burden that it places on us as**  **3 a manufacturer as DOE has noted, and I agree 4 with, we would have to redesign probably**  **5 something in the order of 90 percent of our 6 models to comply with the proposed efficiency**  **7 standards. 8 When you look at the approach that we**  **9 need to go through in terms of designing and 10 validating those efficiency levels, it’s an**  **11 experimental approach. We’re required to 12 test multiple samples of each basic model. We**  **13 don’t have an AEDM so each basic model 14 basically represents any variant to the design**  **15 that can affect energy efficiency. When you 16 put that all together, it’s an enormous task**  **17 for us. 18 We also manufacture commercial**  **19 reach-in equipment. That standard is now 20 final. It’s going to take effect in the same**  **21 time frame so and from a standpoint of how we 22 do our engineering work at our company, we** 

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**202-234-4433 Neal R. Gross and Co., Inc.**  **1 leverage scarce resources. 2 So test labs and other large capital**  **3 investment resources are a shared resource for 4 us and so to have to deal with the Commercial**  **5 reach-in and the ice machine and I fully expect 6 that there will be impact to our walk-in**  **7 refrigeration systems which we also 8 manufacture in that time frame.**  **9 It’s really an incredible burden to 10 us even if we don’t need to change the**  **11 refrigerants that we’re working with and, you 12 know, we’ll see how that plays out. But so I**  **13 think there is a very significant burden 14 that’s going to be placed on us. I don’t see**  **15 any way that we could get all of that redesign 16 work done on all those different product**  **17 classes in a three year time period. It’s 18 just --**  **19 And then when you look at could we go 20 to third-party resources, we’re all going to**  **21 be in that same boat and there aren’t enough 22 third-party resources to really supplement** 

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**202-234-4433 Neal R. Gross and Co., Inc.**  **1 what the industry has available and get that 2 work done.**  **3 My next point would be the technical 4 models for the ice machine performance based**  **5 on test data that we’ve actually recently 6 developed tells me that there some significant**  **7 deficiencies in the models that were used to 8 arrive at the proposed efficiency levels.**  **9 I think that Navigant has done a 10 really good job of trying to correct their**  **11 model to take into account for some of the 12 unique characteristics of ice machines but I**  **13 don’t believe that it’s possible to really do 14 that accurately for an ice machine. It’s**  **15 something we’ve been trying to do for ten years 16 and we’re not comfortable that we have a model**  **17 that can predict all the effects yet. 18 And so I think that, based on what**  **19 we’ve seen, there’s a gross over prediction of 20 the performance for some of the technical**  **21 options. 22 I think there’s also a big disconnect** 

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**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### in terms of the cost assumptions for these **2** 

### technical options and, again, we have data as **3** 

### a manufacturer that, you know, I think they’re **4** 

### off in some cases by a factor of two of the cost **5** 

### impact for some of the technical options. **6** 

### When you put those two together, it **7** 

### causes real concern for me as a manufacturer **8** 

### that the levels that were selected are not, in **9** 

### fact, the optimum from a life cycle cost **10** 

### standpoint. They may not even meet the **11** 

### requirement that the energy savings is **12** 

### basically that the cost addition to the **13** 

### product should be no more than three times the **14** 

### first year energy savings. **15** 

### I’m not convinced that these changes **16** 

### will satisfy that requirement. Oh, it isn’t? **17** 

### Well that’s what was written in the -- **18** 

### MR. CYMBALSKY: Sorry, you’re **19** 

### confusing the rebuttable presumption with the **20** 

### analysis that if it’s under three years, we can **21** 

### do it without any analysis essentially. **22** 

### MR. ERBS: Right.

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**202-234-4433 Neal R. Gross and Co., Inc.**  **1 MR. CYMBALSKY: But it could go up as 2 high as the lifetime.**  **3 MR. BROOKMAN: That’s John 4 Cymbalsky. Thank you, John. Now back to**  **5 Daryl. 6 MR. ERBS: So my mistake, but then I**  **7 would say if it goes out beyond that level of 8 payback, our customers basically will not find**  **9 that to be an economic situation that they can 10 accept.**  **11 My next point would be that the 12 analysis that’s been done has really been**  **13 around 30-inch ice machines. There are 14 smaller cabinets, there are 22-inch models**  **15 that the technical options, I do not believe, 16 would be something that could be included**  **17 within. 18 So I have real significant concerns**  **19 that we would actually no longer be able to 20 produce and sell a 22-inch air cooled ice**  **21 machine as a result of these efficiency 22 standards.** 

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**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### There are applications in the market **2** 

### where people can’t go to a 30-inch ice machine **3** 

### instead of a 22-inch so we’re going to take an **4** 

### entire segment of ice machines off the market **5** 

### as a result of this rulemaking. **6** 

### And then my final point would be all **7** 

### of the analysis is done at the rating point **8** 

### which is a 90 degree air, 70 degree water **9** 

### condition. We have to make ice machines that **10** 

### are reliable over a much wider range of **11** 

### ambient. **12** 

### Some of these technical design **13** 

### options could have significant impact to the **14** 

### reliability and the ability to make ice at the **15** 

### full range of ambient conditions and there **16** 

### hasn’t been any analysis done to show that **17** 

### there isn’t an adverse effect to the overall **18** 

### operating range that our customers require as **19** 

### a result of implementing these proposed **20** 

### efficiency standards. **21** 

### Thank you. **22** 

### MR. BROOKMAN: Let me just step back

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**202-234-4433 Neal R. Gross and Co., Inc.**  **1 one step here. Many of you, most of you are 2 very familiar with this rulemaking process.**  **3 You know that we’re going to go through the 4 slides in great detail as the day goes on. So**  **5 I would encourage you as best you can, while 6 it’s nice to hear an overview statement, we**  **7 don’t want to have a preview of the entire 8 day’s discussion here at the outset. Okay?**  **9 So if we can try and keep these truncated 10 that’d be very helpful.**  **11 Robert, do you have a comment here, 12 please?**  **13 MR. WILKINS: Yes, very truncated. 14 First, I’d like to say thanks to John**  **15 for your comments on refrigerants and R-404A 16 in particular. This is a critical issue**  **17 facing our industry. 18 And to make a general point at this**  **19 stage, I would urge DOE to be explicitly 20 supportive and receptive to low GWP**  **21 refrigerants, not just to say we know they’re 22 out there and things might happen in EPA, but** 

### Page 29

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 rather to be supportive of moving towards more 2 climate friendly refrigerants such as**  **3 isobutane, propane and there are other 4 synthetics as well.**  **5 Thank you. 6 MR. BROOKMAN: Thank you, Robert.**  **7 Did you wish to comment? Your name 8 please.**  **9 MR. PARSONS: George Parsons, 10 Vice-President of Engineering for**  **11 Ice-O-Matic. 12 Mile High Equipment Ice-O-Matic is a**  **13 60-year-old manufacturer of ice machines in 14 the Denver, Colorado area where we manufacture**  **15 97 percent of the ice machines we sell. And 16 we’re very proud of the fact that we compete**  **17 not only in the United States, but we compete 18 globally.**  **19 We have a number of our machines 20 Energy Star rated and we continue to pursue new**  **21 technology and systems to increase that number 22 daily.** 

### Page 30

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### We make the continuous improvements **2** 

### while listening and responding to our **3** 

### customers’ ever-changing needs. What the **4** 

### customers tell us, that they want ice machines **5** 

### that deliver more product in a smaller space. **6** 

### That ever-shrinking footprint is threatened **7** 

### by the work we’re talking about here. **8** 

### We’re talking about making the **9** 

### product bigger to make it more energy **10** 

### efficient which will impact our customers. **11** 

### More importantly, the customers will **12** 

### not be getting the product that they want and **13** 

### need out in their retail space. **14** 

### As with all of my counterparts **15** 

### sitting around the table here, we continuously **16** 

### work through research and development to **17** 

### significantly improve our energy efficiency **18** 

### every day. It’s much greater today than it **19** 

### was just a few years ago. **20** 

### We’re everyday looking for more **21** 

### efficient compressors, more efficient fan **22** 

### motors, more efficient cool water pumps and

### Page 31

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### implementing clever control-circuit logic to **2** 

### take advantage of these new components. **3** 

### As with most technology, this has **4** 

### been an iterative process. However, the **5** 

### standard is demanding as much as a 35 percent **6** 

### energy efficiency improvement over our **7** 

### existing standards today. In some cases, up **8** 

### to 70 percent over the current Energy Star **9** 

### standards. **10** 

### Most people would say this is not a **11** 

### progressive or iterative approach, it’s a very **12** 

### disruptive approach. **13** 

### Through months of analysis by our **14** 

### engineering team working in conjunction with **15** 

### many of the component suppliers sitting around **16** 

### this table today, we firmly believe that the **17** 

### DOE claim of maximum available technology is **18** 

### not here and will not be here in the next five **19** 

### to six years. **20** 

### Even if these technologies were **21** 

### available, it would require a complete **22** 

### redesign of all of our ice machines resulting

### Page 32

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 in years of engineering workload. That would 2 be a critical burden on our business, our**  **3 agencies, but most importantly, our 4 customers.**  **5 In addition, we’re convinced that 6 the DOE ice machine analysis is riddled with**  **7 miscalculations and faulty assumptions based 8 on learnings from past air conditioning and**  **9 Commercial refrigeration technologies. 10 As most everyone in this room knows,**  **11 the unique freeze-thaw freeze-cycle of an ice 12 machine in no way resembles the frost, defrost**  **13 cycle of Commercial refrigeration. 14 Our analysis suggests that larger**  **15 condensers and higher efficiency compressors 16 will result in a much larger footprint of these**  **17 ice machines. Therefore, when an operator 18 needs to replace an ice machine, they’ve got**  **19 to find more space. Eighty percent of the 20 sales in this market are replacement.**  **21 If they have to find more space, it’s 22 much more costly to replace an ice machine to** 

### Page 33

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### make those changes. Therefore, it’s unlikely **2** 

### that the operator sees any type of investment **3** 

### return solely from energy savings. **4** 

### The impact of this increased cost of **5** 

### a new ice machine installation will tend to **6** 

### make customers hold on to existing machines **7** 

### much longer by repairing them. This will have **8** 

### a devastating impact on the ice machine **9** 

### industry in the United States. **10** 

### I would say in closing, Ice-O-Matic **11** 

### fully understands the need for increased **12** 

### energy efficiency, lower water usage in our **13** 

### products. In fact, we support the work to **14** 

### achieve higher energy efficiency standards. **15** 

### However, we believe the technology is not yet **16** 

### where it needs to be to achieve the current **17** 

### lofty proposals or nor do we think the time **18** 

### frame allotted is realistic even if the said **19** 

### technology was available. **20** 

### Thank you. **21** 

### MR. BROOKMAN: Thank you. **22** 

### Additional opening statements? Scott?

### Page 34

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 MR. BINGHAM: Hi, my name is Scott 2 Bingham. I’m with Follett Corporation.**  **3 We’re a generation family business, small 4 family business out of Easton, PA.**  **5 Some of what I’m going to say is 6 germane to the entire industry but some of this**  **7 is specific to us kind of underscoring Daryl’s 8 point that a model that would take into account**  **9 all ice makers is impractical. 10 We found that reliability is number**  **11 one on our end-users list and many of the 12 design criteria we’ve put in place to make a**  **13 machine more reliable does not help the energy 14 efficiency.**  **15 For example, we only make continuous 16 type ice makers. We have implemented a robust**  **17 gear motor that tends to create long life but 18 has a higher energy draw than a corresponding**  **19 smaller deer motor. We flush regularly to 20 help get scale out of the machine to keep it**  **21 cleaner and keep it -- so they will last 22 longer. Both of these impact the energy** 

### Page 35

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 efficiency. 2 In addition, sanitation is a key**  **3 piece for end-users. We’ve developed a 4 machine that can automatically fill an ice and**  **5 beverage dispenser from up to 75 feet away 6 because the ice can be pumped through a tube.**  **7 This ability to pump ice through a tube impacts 8 the energy efficiency of this machine.**  **9 The ice and beverage dispenser is 10 more sanitary because there’s no ice maker on**  **11 top of it. It makes it easier to sanitize 12 because there’s no ice maker on top of it to**  **13 remove. 14 In addition, on occasion, ice and**  **15 beverage dispensers are installed underneath 16 a low ceiling or a soffit where it’s virtually**  **17 impossible to place an ice maker on top of it. 18 So this would be perhaps the only way for an**  **19 operator to automatically fill an ice and 20 beverage dispenser without the opportunity to**  **21 bring it into contact with human hands to have 22 potential cross contamination with that.** 

### Page 36

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 So many ice makers, ours included, 2 have specific features that impact the energy**  **3 efficiency of the machine and are dramatically 4 different from the way other machines are**  **5 manufactured. 6 If this regulation were put into**  **7 place, at a minimum, it would drive great costs 8 into our product and into the resources within**  **9 our building and, at a maximum, because of our 10 nature as a small niche player in this business**  **11 would call into question the viability of our 12 business going forward.**  **13 Thank you. 14 MR. BROOKMAN: Thank you.**  **15 Additional opening remarks? 16 Stephen?**  **17 MR. SCHAEFER: Good morning. I’m 18 Stephen Schaefer with Hoshizaki America. I’m**  **19 the team leader for an administration group. 20 I’d like to say that sitting around**  **21 this table, we’ve got many players who are 22 stewards for our energy efficiency. We’ve** 

### Page 37

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 been recognized from Energy Star as Partners 2 of the Year, Scotsman, Manitowoc, Hoshizaki**  **3 America. 4 We take great pride in not only the**  **5 energy efficiency, but also the quality and 6 reliability of our machines.**  **7 Looking at the undertaking that 8 would need to meet a 30 percent increase in**  **9 energy efficiency will be a huge burden on our 10 industry.**  **11 If you look at our industry from 2005 12 standard, on average, we’ve not only increased**  **13 the energy efficiency by 20 percent -- 14 MR. BROOKMAN: Hold on just one**  **15 second. Why doesn’t anyone not speaking make 16 sure your microphone is turned off. Let’s try**  **17 that first. Maybe that helped a little bit. 18 Okay, Stephen, keep going.**  **19 MR. SCHAEFER: We had a 20 percent 20 increase in ice production, a 30 percent**  **21 decrease in energy consumption and a 25 22 percent decrease in water use. We’ve done a** 

### Page 38

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### great job with a very hard niche market. An **2** 

### ice machine is not like a refrigerator where **3** 

### you just have the compressors going and going **4** 

### and going and can stabilize to meet the needs. **5** 

### We’ve got to freeze the water and **6** 

### then slam it to go into harvest. So it’s a **7** 

### very complex system which our engineers have **8** 

### gone through great deal of time and effort to **9** 

### make the most energy efficient product. **10** 

### So looking at not only the commercial **11** 

### refrigeration field that we’re going to have **12** 

### to go through and redesign our refrigerators, **13** 

### we’re also looking at this and the SNAP. **14** 

### We greatly look forward to working **15** 

### together for a negotiated rulemaking to look **16** 

### at what the most benefit to our field is **17** 

### because we would like to do the best we can with **18** 

### our suppliers to make the most energy **19** 

### efficient. But right now, with our analysis, **20** 

### we do not see an additional five to ten percent **21** 

### available in the next three to five years. **22** 

### So we look forward to working with

### Page 39

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 you to make the best possible energy 2 efficiency that we can do because in the end,**  **3 ice makers are not the most energy users in the 4 restaurant or the hospitals. We’re very**  **5 minute compared to other areas. 6 So let’s look at everything in**  **7 comparison and we look forward to the 8 challenge ahead of us.**  **9 Thank you very much. 10 MR. BROOKMAN: Okay, thank you.**  **11 Yes, Chris? 12 MR. SALATINO: Good morning, Chris**  **13 Salatino. I’m Vice-President of Engineering 14 for Scotsman Ice Systems.**  **15 I just want to take a couple minutes 16 to give you some of our opening remarks.**  **17 Scotsman endorses the Department of 18 Energy’s efforts to increase the efficiency**  **19 levels for the ice maker category. 20 Additionally, we appreciate the numerous**  **21 considerations that DOE have analyzed in 22 setting new efficiency targets for our** 

### Page 40

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 industry. 2 As an Energy Star Partner of the Year**  **3 Award winner for the last two years, we are 4 committed to developing and commercializing**  **5 energy efficient ice makers that meet all of 6 the demands of our customers and are compliant**  **7 with government regulations. 8 With that, based on our experience,**  **9 the technological feasibility and performance 10 improvement opportunity associated with the**  **11 design options identified in this proposed 12 rulemaking has been overestimated and the**  **13 economic justification impact to equipment 14 reliability and the development time required**  **15 to meet the proposed standards have been 16 underestimated.**  **17 The targeted efficiency gains 18 proposed in this proposed rulemaking are based**  **19 on technological feasibility assessments of 20 components not currently utilized in the ice**  **21 maker industry. 22 We have not been able to identify** 

### Page 41

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### components under consideration of this **2** 

### proposed rulemaking that meet the asserted **3** 

### efficiency gains in a system application, do **4** 

### not negatively impact equipment reliability **5** 

### across the operating envelope, and meet the **6** 

### purchase-cost-increase-to-energy-savings **7** 

### ratio expectations for ice makers. **8** 

### Additionally, the assessments of the **9** 

### proposed technology in this rulemaking are **10** 

### focused on one environmental condition. Our **11** 

### equipment must perform reliably over a much **12** 

### broader spectrum of environments. We are **13** 

### bound by our customers to develop equipment **14** 

### that maximizes ice production per cubic foot, **15** 

### maximizes reliability across the operating **16** 

### envelope and minimizes the operating costs **17** 

### across the envelope. **18** 

### Focusing ice maker performance at **19** 

### one condition is detrimental for the machine **20** 

### reliability across the operating envelope. **21** 

### The decreased machine reliability and **22** 

### lessening of available ice per cubic foot

### Page 42

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### negatively impacts the end user business model **2** 

### by constraining sales of primary profit **3** 

### generating beverage products supported by the **4** 

### ice maker in a food service application. **5** 

### We have requested component cost **6** 

### increases relative to our baseline technology **7** 

### from the ice maker vendor base and external **8** 

### components suppliers and have found that ECMs **9** 

### cost increase will be two to three hundred **10** 

### percent over baseline owners. High **11** 

### efficiency compressor cost increases will be **12** 

### up to 30 percent over baseline components. **13** 

### Please note that we have not **14** 

### successfully proven both components **15** 

### performance and reliability effectiveness **16** 

### within an ice maker across the application **17** 

### operating envelope. **18** 

### We have recorded data that indicates **19** 

### we are able to meet TSL-1 performance by **20** 

### increasing evaporator size 50 percent to **21** 

### condenser size 35 percent. These two changes **22** 

### would increase manufactured product costs 25

### Page 43

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### percent and would increase the cabinet size of **2** 

### our models. **3** 

### Increasing cabinet size requires our **4** 

### customers to invest in their facilities to **5** 

### accommodate newer equipment of larger cubic **6** 

### dimension. These investments vary by **7** 

### regional labor rates but can be up to **8** 

### $30,000.00 per outlet. The alternative to **9** 

### this is constrained beverage sales by **10** 

### minimized ice capacity for fountain beverage **11** 

### dispensers having fixed footprints. Neither **12** 

### of these economic impacts have been accounted **13** 

### for in the DOE evaluation. **14** 

### Another economic impact that has not **15** 

### been accounted for in the evaluation is the **16** 

### impact these regulations have on our ability **17** 

### to compete in the global market. We will be **18** 

### competing with lower manufactured product **19** 

### costs ice maker products not governed by the **20** 

### standard across global market segments in **21** 

### which customers’ primary decision criteria on **22** 

### the sale price.

### Page 44

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### This burden contradicts the **2** 

### President’s intent to increase American **3** 

### exports and remove barriers that prevent **4** 

### American businesses from selling their **5** 

### products and services in growing markets. **6** 

### In efforts to meet the DOE standards **7** 

### that went into effect in 2010, Scotsman Ice **8** 

### Systems expedited our development process to **9** 

### meet the implementation deadline, incurred **10** 

### expenses that exceeded 20 percent of sales **11** 

### dollars to develop and commercialize a **12** 

### complete product portfolio, increase **13** 

### manufacture product cost by eight percent and **14** 

### halted all other customer focused research and **15** 

### development efforts. **16** 

### Given the proposed efficiency levels **17** 

### and target implementation date of this **18** 

### proposed rulemaking, we would expect these **19** 

### costs to be incurred again prior to expiration **20** 

### of Scotsman internal metrics, financial **21** 

### metrics, associated with the previous **22** 

### standard increase of 2010.

### Page 45

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### Of our Commercial ice maker product **2** 

### line, 97 percent will need to be replaced in **3** 

### order to achieve the target efficiency levels. **4** 

### We will not be able to develop and **5** 

### commercialize the new portfolio products by **6** 

### this date without assuming excessive risk to **7** 

### our product reliability and warranty again. **8** 

### This risk will be compounded by **9** 

### regulatory measures dictating a change in **10** 

### acceptable refrigerants if implemented by **11** 

### EPA. **12** 

### Given the scope of work, the **13** 

### availability of technology and the assigned **14** 

### efficiency level, an eight year **15** 

### implementation deadline is more applicable **16** 

### based on our experience. **17** 

### The first three years of that time **18** 

### line would be ramping up the suppliers’ R&D **19** 

### investments for subcomponents, identifying **20** 

### technology performance evaluations, **21** 

### reliability evaluations and then negotiating **22** 

### technology costs and availability for the

### Page 46

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### components. **2** 

### The remaining five years would be **3** 

### required to integrate the technology into **4** 

### reliable commercial ice maker platforms and **5** 

### develop the manufacturing processes capable **6** 

### of reliably producing these new ice maker **7** 

### platforms. **8** 

### Scotsman Ice Systems supports DOE’s **9** 

### intent to improve ice maker efficiency **10** 

### performance across the entire category and **11** 

### strictly enforce these standards across all **12** 

### global and domestic manufacturers. We feel **13** 

### that establishing the efficiency thresholds **14** 

### at TSL-1 effective 2020 is technologically **15** 

### feasible, economically justified, saves a **16** 

### significant amount of energy for this category **17** 

### and is consistent with past regulatory **18** 

### implementation time commitments. **19** 

### Thank you. **20** 

### MR. BROOKMAN: Thank you. Frank, **21** 

### yes? **22** 

### MR. MOORE: Thank you. Frank Moore

### Page 47

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 with NAFEM and I welcome the use of the acronym 2 that would be North American Association to**  **3 just slipped -- and missed a word, no problem, 4 NAFEM.**  **5 I just want to quickly echo much of 6 what has been said here, certainly what Laura**  **7 said in her opening remarks. But it’s 8 refreshing to hear from the folks that**  **9 actually make this equipment. NAFEM 10 certainly has concerns as many of our members**  **11 around the table do about the technological 12 feasibility that’s based in the proposed rule,**  **13 the economic impact and I think Daryl made 14 mention of just the regulatory burden of these**  **15 multiple rules coming down at once. 16 These are realities that I think that**  **17 DOE can in the rulemaking process take into 18 consideration. We don’t think that DOE, and**  **19 we’ve heard these before, it’s sort of deja vu 20 all over again in a sense that a lot of these**  **21 issues were raised in the CRE rulemaking. We 22 do not feel like that those were adequately** 

### Page 48

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### responded to in the final rule. **2** 

### Look forward to a better process **3** 

### going forward. **4** 

### MR. BROOKMAN: Okay, thank you. **5** 

### Final remarks here in the room? **6** 

### Opening remarks? Andrew deLaski? **7** 

### MR. DELASKI: I just want to thank **8** 

### the manufactures for their sort of deep **9** 

### engagement in this rulemaking and recognize as **10** 

### has been pointed out that the ice maker **11** 

### industry has made a lot of progress in energy **12** 

### efficiency improvement starting with the **13** 

### levels that were negotiated and included in **14** 

### the Energy Policy Act of 2005 and took effect **15** 

### in 2010. **16** 

### Based on state standards, initially **17** 

### had been developed in California and adopted **18** 

### by some other states, the industry embraced **19** 

### and supported as for national enactment. And **20** 

### as part of that statute and part of that **21** 

### agreement, that set up this rulemaking that **22** 

### we’re all participating in right now. Okay?

### Page 49

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### That was part of the statute that was agreed **2** 

### to by the industry along with the **3** 

### organizations that we continue to work with. **4** 

### I want to us all to partner for moving **5** 

### forward with that rulemaking. I think the **6** 

### initial intent was to try to start early. **7** 

### Right? The initial schedule at the framework **8** 

### stage, the Department had hoped to complete **9** 

### this rule in 2012. So at some level, we’re **10** 

### already a little bit later than we had hoped **11** 

### to be -- that the Department had hoped to be. **12** 

### The statutory deadline for a final **st 13**  

### rule is I believe January 1 , 2015. So that’s **14** 

### a hard deadline. Right? That’s a law that **15** 

### they have to comply with that and we will be, **16** 

### you know, encouraging the Department very much **17** 

### to comply with that deadline. **18** 

### There’s some flexibility in terms of **19** 

### the effective date. Right? It’s three years **20** 

### is the default. The Department can do up to **21** 

### five years. Those are kind of the rules of the **22** 

### road as we understand them and I welcome if

### Page 50

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### Francine or Doug want to clarify that, that’d **2** 

### be helpful if I got that right or not. **3** 

### In terms of timing, we think those **4** 

### are kind of the parameters of what’s going on **5** 

### here. **6** 

### In terms of the levels, we very much **7** 

### look forward to the technical conversation **8** 

### that’s going to happen today and in terms of **9** 

### the written comments that I just heard **10** 

### previewed, there’s going to be some technical **11** 

### comments coming from you guys that’s going to **12** 

### be addressing your concerns with what these **13** 

### folks have prepared for us all to evaluate. **14** 

### And we look forward to evaluating those and **15** 

### considering those as we begin the discussion **16** 

### today and as part of the ongoing public **17** 

### rulemaking process. **18** 

### We support the proposed levels. I **19** 

### think they make sense. When we look at the **20** 

### levels and the analysis as published, we **21** 

### typically begin with the highest levels that **22** 

### are shown to be cost effective and will

### Page 51

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### typically look to support those levels and, in **2** 

### fact, higher levels than are proposed in **3** 

### today’s rule are cost effective per the DOE’s **4** 

### analysis as it exists today. **5** 

### The max tech levels are shown to be **6** 

### cost effective on a life cycle average basis **7** 

### for consumers for the purchase of ice **8** 

### machines. **9** 

### I hear you, you take issue with some **10** 

### of the analysis. We look forward to looking **11** 

### and to learning more about the issues that in **12** 

### that analysis. But based on DOE’s analysis, **13** 

### higher levels than proposed are cost effective **14** 

### on average. **15** 

### And the tests of life cycle cost to **16** 

### cost effective, not three years or something **17** 

### shorter. Is it cost effective over the useful **18** 

### life of the product? **19** 

### I’m a little surprised that the **20** 

### standards that are proposed have a range of **21** 

### efficiency improvement between ten percent **22** 

### and 30 percent, depending on the product

### Page 52

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 category. The levels that are cost effective 2 at the maximum level also are a range of**  **3 between 17 percent and eyeballing it here, 40 4 percent improvements in efficiency at the**  **5 maximum cost effective level. 6 Based on our analysis of the DOE**  **7 certification database, there are products in 8 the market today at the proposed levels across**  **9 the forays of equipment that meet the 10 standards.**  **11 So I’m a little surprised to hear -- 12 I think I’m hearing some concerns that you**  **13 can’t even make these machines but yet based 14 on the certification database, they’re there.**  **15 So again, we need to get to the bottom of that 16 concern.**  **17 On the refrigerants issue, I won’t 18 belabor it, but John, I think that the way that**  **19 the Department’s done with it in this 20 rulemaking is consistent with how you’ve dealt**  **21 with it in all other rulemakings along with 22 other issues. But the Department has to base** 

### Page 53

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 its decisions based on existing policy, not 2 all like may or may not happen. And because**  **3 policy, we don’t, you know, we can’t predict 4 what’s going to happen in that process, it has**  **5 to move forward and in parallel, and I am very 6 glad to hear the Department’s in a high level**  **7 dialogue with our colleagues at the EPA to make 8 sure the two are in sync.**  **9 Thank you. 10 MR. BROOKMAN: Thank you. Final**  **11 comments here? Edward Osann, who’s joining 12 us via the web has an opening remark. I should**  **13 back up one step to say we had a little bit of 14 trouble getting the web working properly this**  **15 morning. My apologies. The Department of 16 Energy apologizes as well for some technical**  **17 glitches. We hope it’s working well for you 18 now.**  **19 Edward Osann, please unmute your 20 phone and speak.**  **21 MR. OSANN: Okay, do we have a 22 connection?** 

### Page 54

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### MR. BROOKMAN: You’re good, yes. **2** 

### MR. OSANN: Okay. **3** 

### Yes, my name is Ed Osann, I’m with the **4** 

### Natural Resources Defense Council. **5** 

### We have an interest in all aspects of **6** 

### this rulemaking but my remark will be confined **7** 

### to one area this morning, the outset. **8** 

### NRDC takes strong issue with the **9** 

### assertions in footnote three of the Notice **10** 

### regarding consideration of condenser water **11** 

### use in this rulemaking and will provide **12** 

### further written comments on this point for the **13** 

### record. **14** 

### We also note that we have previously **15** 

### urged the Department to evaluate and propose **16** 

### standards for potable water use for batch-type **17** 

### ice makers. Failure to consider potential **18** 

### standards for potable water use is **19** 

### particularly short-sighted as evidenced by **20** 

### the willingness of manufacturers to explore **21** 

### this issue as documented in comments at the **22** 

### framework stage of this rulemaking and by the

### Page 55

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 increasing severity of drought conditions in 2 many states during the pendency of this rule**  **3 making, most recently the January 2014 4 declaration of a drought emergency by the**  **5 Governor of California. 6 Indeed, the failure to consider a**  **7 meaningful standard for water use efficiency 8 is a virtual invitation to the states to**  **9 consider and adopt efficiency standards, test 10 procedures and labeling requirements of their**  **11 own for the water use of automatic commercial 12 ice makers.**  **13 MR. BROOKMAN: Ed, are you finished? 14 MR. OSANN: Yes, that concludes it.**  **15 MR. BROOKMAN: Okay. Thank you, 16 Ed.**  **17 Okay, are we ready to move on then to 18 the content here? Let’s do that. Let’s**  **19 start with the presentation material which 20 would be beginning on Slide 5 I believe.**  **21 MR. RANEY: Doug, I did not get a 22 packet. Can I get a packet?** 

### Page 56

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 MR. BROOKMAN: Sure, here’s an extra 2 one.**  **3 MR. CYMBALSKY: So we’re on the 4 purpose of the public meeting? Is that what**  **5 -- okay. 6 So John Cymbalsky, DOE, I’m going to**  **7 handle the first section here and then we’re 8 going to turn it over to the technical team for**  **9 the content and then at the end, I will deliver 10 the levels of the standards.**  **11 Okay, so the purpose of the meeting 12 here is to present the analytical approaches**  **13 that we took to evaluate the different levels 14 here for automatic commercial ice makers. Of**  **15 course, invite as much public comment as 16 possible on what we’ve done so that we can**  **17 incorporate it into the final rule. And then 18 of course, we’ve already received your summary**  **19 comments. 20 As we go through, you’ll see a bunch**  **21 of issue boxes in the presentation and at that 22 point, we will pause to get your comments, your** 

### Page 57

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 particular comments on the issue that is 2 raised in the issue box. So these will be**  **3 sprinkled throughout. The numbers should 4 line up with what we see in the document.**  **5 And then the deadline for submitting th**  **6 all comments is May 16 , 2014 so the goal here 7 was to give you a full month after this public**  **8 meeting to consider what was presented here 9 and said by the rest of the stakeholders to**  **10 provide your public comments. 11 Here’s all the different ways in**  **12 which you can submit your public comments. 13 Obviously the e-mail is the best way to do it.**  **14 Feel free to copy me and Brenda in the e-mail 15 addresses because we’ve had people,**  **16 unfortunately, transcribe some very difficult 17 e-mail addresses. I can understand it. I’ve**  **18 hit incorrect keys as well with dashes and dots 19 and all that kind of thing.**  **20 And unfortunately, if it gets sent to 21 the wrong mailbox, you may not get an error**  **22 that it went to the wrong place. So feel free**

### Page 58

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 to copy me, a human being that you’ll know will 2 get the e-mail and we’ll put it in the docket.**  **3 Okay, so I’m going to handle the 4 first box here which is the regulatory history**  **5 of the rulemaking. 6 So the Energy Policy and**  **7 Conservation Act of 1975 is our sort of 8 founding statutory authority for the program.**  **9 This was amended in 1978 by the National Energy 10 Conservation and Policy Act and it established**  **11 the program for certain industrial equipment. 12 Andrew alluded to EPACT 2005 which**  **13 amended EPCA to add coverage for automatic 14 Commercial ice makers between 50 and 2,500**  **15 pounds of ice per day and it granted DOE the 16 authority to set standards for additional**  **17 types of Commercial ice makers that were not 18 included. So flakes, nuggets and others.**  **19 And then it required DOE to complete 20 one rulemaking cycle to determine whether or**  **21 not to amend the original standards and then 22 Andrew also said the final rule is required by** 

### Page 59

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### no later than January 1 of 2015. **2** 

### Okay, the definition, so the **3** 

### definition here is very broad, automatic **4** 

### commercial ice maker means a factory made **5** 

### assembly, not necessarily shipped in one **6** 

### package that (a) consists of a condensing unit **7** 

### and ice making section operating as an **8** 

### integrated unit with means for making and **9** 

### harvesting ice; and (b) may include means for **10** 

### storing ice, dispensing ice or storing and **11** 

### dispensing ice. **12** 

### So in my mind, and DOE’s mind, this **13** 

### rather broad definition of ice makers includes **14** 

### quite a number of products. **15** 

### The test procedures, so pursuant to **16** 

### EPCA, DOE published a final rule that adopted **17** 

### a revised test method for calculating energy **18** 

### use based on the existing industry standards. **th 19**  

### And then on January 11 , 2012, we published a **20** 

### final rule on a test procedure, it became **21** 

### mandatory for all automatic commercial ice **th 22**  

### makers testing starting January 7 of 2013.

### Page 60

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 The test procedure included a few 2 different revisions and so we referenced AHRI**  **3 810-2007 and ANSI/ASHRAE 20-2009 that 4 expanded the scope to include equipment up to**  **5 4,000 pounds and it provided test methods for 6 continuous ice makers.**  **7 Okay, so we’ve heard these words used 8 by a few different people in their opening**  **9 remarks so, DOE must amend set standards that 10 are technologically feasible and economically**  **11 justified and so everything you see in our 12 analysis today, you know, goes towards meeting**  **13 that criteria and if it doesn’t, we can’t set 14 a standard at that level.**  **15 We perform lots of different 16 analysis to determine the technological**  **17 feasibility so we have the market and tech 18 assessment to screening analysis and the**  **19 engineering analysis all of which we will 20 present to you today in detail.**  **21 And then we have what’s known as the 22 seven factors in EPCA. I’m not going to read** 

### Page 61

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 them all, I’ll just highlight a few that people 2 have brought up. Sort the idea of utility has**  **3 been sort of alluded to here in that whether 4 or not the efficiency standards will continue**  **5 to provide the level of service that customers 6 demand, you know, ice hardness, that type of**  **7 thing. 8 And so we can’t set a standard**  **9 whereby consumers’ utility will be impacted. 10 And then there is the competition so**  **11 we can’t set a standard to create a monopoly 12 or things of that nature.**  **13 Okay, the time line, so here we are. 14 Andrew alluded to the fact that DOE really**  **15 tried to get through this rulemaking at a 16 quicker pace than we had but, obviously, this**  **17 program has lots of things that have it wane 18 and wax over a little over a three year period.**  **19 But in any event, we are on track to st**  **20 meet the January 1 , 2015 deadline for the 21 final rule and so you can see that mark there**  **22 towards the right of the time line and then to**

### Page 62

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### be determined is the compliance date for that **2** 

### standard. **th 3**  

### And today, we’re at April 14 , 2014 **4** 

### with the NOPR meeting for the standard. **5** 

### Okay, unless we have any questions, **6** 

### I’m going to turn it over to my technical team **7** 

### to handle items two through seven. **8** 

### MR. BROOKMAN: Thank you. Detlef? **9** 

### MR. WESTPHALEN: Thanks, John and **10** 

### Doug. **11** 

### I will be presenting on the Market **12** 

### and Technology Assessment and also the **13** 

### Screening Analysis. You can see here this **14** 

### chart shows the flow of some of the up-front **15** 

### analyses, how they feed into the downstream **16** 

### analyses. Many of you have seen this chart **17** 

### before, I won’t dwell on it. **18** 

### The market and technology assessment **19** 

### essentially is a data collection exercise **20** 

### trying to characterize the ice maker market **21** 

### and the industry involves gathering **22** 

### historical data, performance data for ice

### Page 63

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### makers trying to set appropriate equipment **2** 

### classes for the different types of products **3** 

### that are out there in the market and to **4** 

### identify technology options from proving **5** 

### efficiency. **6** 

### I’m not going to be spending much **7** 

### time on the market, now we’ve discussed that **8** 

### in the framework meeting and also the **9** 

### preliminary analysis meeting. There’s a **10** 

### detailed description in Chapter 3. **11** 

### Starting in on equipment classes, **12** 

### the current standards that were established by **13** 

### EPAC 2005 cover cube-type ice makers and **14** 

### harvest capacity rate range from 50 to 2,500 **15** 

### pounds per day. **16** 

### In this NOPR, DOE is considering **17** 

### extension of coverage to total of 25 covered **18** 

### classes. When we get into the nitty gritty, **19** 

### the question of exactly is it 25, 26, 27, yes, **20** 

### but that’s a small point, roughly extending **21** 

### the coverage to continuous ice makers, those **22** 

### are the flake and nugget machines, that’s one

### Page 64

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 change. 2 Another change is extending the**  **3 capacity range to cover those ice makers in the 4 2,500 to 4,000 pound per day range.**  **5 And the coverage will now be applied 6 to what are called batch ice makers rather than**  **7 cube-type. For the most part, these are the 8 same things. The only difference is really**  **9 that cube-type was restricted to a particular 10 size of ice whereas batch are simply the cyclic**  **11 batch-type process that has a free cycle and 12 then a harvest cycle.**  **13 The test procedure final rule 14 established these definitions, batch ice**  **15 maker, continuous ice maker, there are some 16 other definitions associated with**  **17 understanding the classes. A lot of that 18 information is already finalized in the test**  **19 procedure. 20 Here’s a seeing eye chart view of the**  **21 equipment classes. These are the batch-type 22 equipment classes and you can see that, you** 

### Page 65

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 know, it’s broken down first by equipment 2 type. You can consider that as the packaging.**  **3 The IMH, the ice-making head style are single 4 packaged ice makers without an ice storage**  **5 bin. The RCU are split-system two piece ice 6 makers in which the condenser or the**  **7 condensing unit are located outside. And SCU 8 are single-packaged units with the ice storage**  **9 bin located within the unit. 10 MR. STARR: So, Louis Starr.**  **11 Just on the remote condensing units, 12 I’m wondering, there’s not a category for the**  **13 water and the fact that we have the air cooled 14 ones but not water cooled. There’s not**  **15 adequate B- maybe provide an explanation why 16 there’s maybe not a separate category for**  **17 that. 18 MR. WESTPHALEN: All right, here I**  **19 have to, and somebody can correct me if I’m 20 wrong, but my recollection is that water**  **21 cooled remote are under the same category as 22 water cooled. And there may just be one or two** 

### Page 66

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### of them in the market. **2** 

### MR. BROOKMAN: I’m looking through **3** 

### the manufacturers for any clarification -- **4** 

### MR. ERBS: I guess I can make a **5** 

### comment -- **6** 

### MR. BROOKMAN: -- to offer. **7** 

### Daryl? **8** 

### MR. ERBS: For a water cooled unit, **9** 

### it’s generally not a difficult task to fit a **10** 

### water cooled condenser inside an ice-making **11** 

### head. So there hasn’t been, I guess enough of **12** 

### a reason to develop a range of products where **13** 

### a water cooled condensing unit would be remote **14** 

### from the ice-making head. So I think it’s **15** 

### just there really hasn’t been a market reason **16** 

### to do that. **17** 

### MR. BROOKMAN: Thank you, Daryl. **18** 

### Do you wish to comment? Okay. **19** 

### MR. ERBS: Does that clarification **20** 

### work for you? **21** 

### MR. WESTPHALEN: Yes, I mean I think **22** 

### it answers the question.

### Page 67

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### MR. ERBS: Okay. **2** 

### MR. WESTPHALEN: The other -- the **3** 

### next column there shows, you know, another way **4** 

### to distinguish these ice makers, the type of **5** 

### cooling. This is the medium used to take the **6** 

### heat out of the refrigeration system, air **7** 

### cooled use ambient air and water have a water **8** 

### loop that goes through the unit. **9** 

### Then there is the distinction of the **10** 

### different harvest capacity rates for the **11** 

### different units for the different classes **12** 

### within each equipment and type of cooling **13** 

### category. **14** 

### The maximum efficiency standards or **15** 

### the maximum efficiency typically attainable **16** 

### follows a trend in which small ice makers use **17** 

### more energy and because of the trends in **18** 

### efficiency of the underlying components, that **19** 

### energy use starts to decline as you increase **20** 

### the capacity and then levels out as the **21** 

### component improvement potential is no **22** 

### longer-- there’s no longer much you that can

### Page 68

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 do at the higher capacities. 2 And so these standards have been**  **3 split out into separate lines which are then 4 define the separate capacity ranges that are**  **5 involved. 6 There was a lot of talk about -- the**  **7 reason I bring this up, there was a lot of talk 8 in the past meetings on whether it should be**  **9 a series of lines or a single equation. But 10 the proposal here includes the piece-wise**  **11 linear series of lines to represent that 12 standard.**  **13 Here is the table showing the 14 equipment classes for continuous ice makers.**  **15 A very similar structure to what we have for 16 the batch-type. You’ll note that the change**  **17 from the small to the large is at a different 18 harvest capacity rate. You know, that it’s**  **19 just if you look at the data it shows that that 20 should occur at a higher capacity.**  **21 During the course of the work on the 22 NOPR, DOE spent more time looking at spending,** 

### Page 69

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 more time looking at more available data, 2 looking at manufacturer websites and also**  **3 looking at new data available during that time 4 period on the AHRI website.**  **5 One of the key things that was 6 mentioned at the preliminary analysis meeting**  **7 was that AHRI was, at that time, in the process 8 of, you know, working through ratings of**  **9 continuous ice makers and in particular 10 getting measurements of ice hardness which is**  **11 a key factor in the energy use metric for 12 continuous ice makers.**  **13 So during the course of 2012, you 14 know, several new ice maker data sets were put**  **15 on to the AHRI directory and that was factored 16 into development of the baseline levels for**  **17 the continuous classes. 18 So baseline efficiency levels, for**  **19 batch ice maker equipment classes, DOE looked 20 to the current cube-type standards as the**  **21 efficiency levels. This is generally for a 22 product that is already covered by DOE** 

### Page 70

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### standard. This is defined as the baseline. **2** 

### The key new thing here is the **3** 

### extension of that standard out to the 4,000 **4** 

### pound per day capacity rate. **5** 

### For continuous ice maker classes, **6** 

### DOE looked again at the available data since **7** 

### there was new available data and adjusted its **8** 

### baseline efficiency levels that initially **9** 

### were suggested at the preliminary analysis **10** 

### meeting. And this table shows the new **11** 

### baseline efficiency levels. **12** 

### The chart on the next page **13** 

### illustrates this new baseline as compared with **14** 

### the preliminary analysis baseline for two **15** 

### classes, IMHA air cooled continuous and also **16** 

### self-contained air cooled. **17** 

### And for instance, you can see with **18** 

### the self-contained, the preliminary analysis **19** 

### proposal really wasn’t representative of that **20** 

### data. **21** 

### MR. BROOKMAN: Scott, please use the **22** 

### microphone.

### Page 71

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 MR. BINGHAM: This is Scott Bingham. 2 A question, so does this include the**  **3 adjustment for ice hardness in these graphs? 4 MR. WESTPHALEN: Yes, it does.**  **5 MR. BINGHAM: And does it include 6 data that was available as of the end of 2012?**  **7 MR. WESTPHALEN: Yes. 8 MR. BINGHAM: So there may be new**  **9 data that we would want to make available to 10 you.**  **11 MR. WESTPHALEN: Okay. Yes. We 12 recently went through a process of looking at**  **13 the AHRI database to see what was new and 14 Javier, correct me if I’m wrong, but I think**  **15 these charts already include that here. 16 MR. BURGOS (Off microphone comment.)**  **17 MR. WESTPHALEN: Okay, but we have 18 looked at the new data that has recently come**  **19 on, you know, onto the directory and it doesn’t 20 show that this curve should be changed a whole**  **21 lot. 22 MR. BROOKMAN: So, Scott --** 

### Page 72

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 MR. BINGHAM: Okay, I will handle 2 that on the written comments. We’re Follett**  **3 -- This is Scott Bingham, Follett is not a part 4 of AHRI so it would not have been in there.**  **5 MR. WESTPHALEN: Okay. 6 MR. BROOKMAN: Okay.**  **7 MR. WESTPHALEN: Moving on to the 8 technology assessment --**  **9 MR. BROOKMAN: Yes, please, Louis? 10 MR. STARR: Just one last question**  **11 on the last slide there. 12 I was hoping to understand, it looks**  **13 like this might be good for a continuous-type 14 equation here but it looks like you did it in**  **15 segments. 16 You maybe touched on why maybe you**  **17 didn’t use the newest power equation or 18 setting standard levels or is it just because**  **19 that’s how they were previously set or what’s 20 the rationale of not using the equation form?**  **21 MR. WESTPHALEN: Well, I mean my 22 feeling was that, you know, I’d like to be able** 

### Page 73

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 to do the calculation on, you know, a piece of 2 paper. And, you know, I’m aware that, you**  **3 know, Energy Star is using like a power law and 4 I can’t do that on a piece of paper.**  **5 But, you know, essentially it’s a 6 piece-wise linear function. You know, I**  **7 don’t, you know, we talked about the different 8 classes for the different capacity ranges but**  **9 my feeling is that this is just a function that 10 goes all the way. It just has a different**  **11 equation in this part than that part. 12 MR. BROOKMAN: Louis?**  **13 MR. STARR: Well, just kind of more 14 of the thought too was aligning with Energy**  **15 Star so it helps to -- if you’re both using 16 power equations then it to some extent helps**  **17 align the categories between Energy Star and 18 what the DOE standards are.**  **19 And I don’t know, maybe the 20 manufacturers have a thought on that as well,**  **21 but, you know, that was my thought about it. 22 MR. BROOKMAN: Daryl?** 

### Page 74

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 MR. ERBS: Yes, just one comment. I 2 think our concern would be whether there will**  **3 be an Energy Star category should the proposed 4 standards go into effect.**  **5 MR. BROOKMAN: Okay. Yes, Stephen? 6 MR. SCHAEFER: Stephen Schaefer.**  **7 Just-- we’ll put in our comments also 8 that looking at the data, it is not indicative**  **9 of all the units on there and looking at our 10 data for continuous units, about 80 percent of**  **11 our units will not be able to meet these 12 standards.**  **13 MR. BROOKMAN: Okay, you have new 14 data that you can submit?**  **15 MR. SCHAEFER: Yes, we’ll put that 16 in the comment period.**  **17 MR. BROOKMAN: Okay. Laura, I 18 thought you said 95 percent of the ice makers**  **19 were -- didn’t you say something like that in 20 your opening remarks?**  **21 MS. PETRILLO-GROH: Laura Petrillo, 22 AHRI.** 

### Page 75

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### Ninety-five percent of the product **2** 

### is produced by AHRI manufacturers. The **3** 

### certification programs are voluntary and not **4** 

### all manufacturers participate and there are **5** 

### manufacturers that are not members of AHRI. **6** 

### MR. BROOKMAN: Thanks for the **7** 

### clarification. Yes, please, Frank. **8** 

### MR. MOORE: Frank Moore with NAFEM. **9** 

### Just a point of clarification, we’re **10** 

### plugging in 2012 data but we’re just **11** 

### discovering that maybe 2012 data and current **12** 

### data is not plugged in. Is that what I’m **13** 

### hearing? So we’ve got a model already here **14** 

### that’s does not have the current data. **15** 

### MR. BROOKMAN: So we’re turning to **16** 

### Scott now. **17** 

### MR. BINGHAM: Yes, this is Scott **18** 

### Bingham. **19** 

### Yes, that’s correct, we’re not a **20** 

### member of AHRI. Our data is not in AHRI. Our **21** 

### data, some of it is available on the Energy **22** 

### Star website because we have many Energy Star

### Page 76

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 certified pieces of equipment but it would not 2 be in the AHRI data.**  **3 MR. BROOKMAN: Frank, follow up. 4 MR. MOORE: This is Frank from**  **5 NAFEM. 6 I know that there has been some**  **7 interviewing perhaps with manufacturers, but 8 did this not occur with manufacturers to**  **9 really get the data? 10 MR. BROOKMAN: Scott?**  **11 MR. BINGHAM: Scott Bingham. 12 From my standpoint, some of this data**  **13 wasn’t available in 2012. The continuous 14 type ice makers were not a part of the Energy**  **15 Star program until the final ruling 16 implementation was in 2013, so that’s when it**  **17 was completed and on the Energy Star website. 18 MR. BROOKMAN: John Cymbalsky.**  **19 MR. CYMBALSKY: John Cymbalsky, 20 DOE.**  **21 So, I guess I want to hear about the 22 implications of what you’re saying. So if I’m** 

### Page 77

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 hearing it correctly, the points that we’re 2 not capturing appear to be Energy Star units**  **3 and in my mind, that signals that our baseline 4 maybe too low. On these, I’m just trying to**  **5 get what the data points -- 6 MR. WESTPHALEN: Well, I mean I have**  **7 some questions myself I mean if they are Energy 8 Star units then they don’t really provide a**  **9 good indication of what the baseline is which 10 is supposed to be the highest energy users.**  **11 And I guess my follow-up question, 12 you know, regarding the units that don’t meet**  **13 the standard, do you mean -- 14 MR. BROOKMAN: Let’s go one question**  **15 at a time. Scott? 16 MR. BINGHAM: So I would state that**  **17 -- Scott Bingham -- some of our machines are 18 on the Energy Star website, some aren’t this**  **19 is more recent data that we’ve done so a number 20 of our machines could end up on this plot. I**  **21 don’t know where they will end up without 22 looking at it in more detail. So that line** 

### Page 78

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 might move up, might, you know, I don’t know. 2 MR. BROOKMAN: Stephen, go ahead.**  **3 MR. SCHAEFER: Stephen Schaefer, 4 Hoshizaki America.**  **5 Yes, Energy Star is the top 25 6 percent. They went through a good analysis of**  **7 our -- the total flake to nugget machines and 8 at 2012, we were just not available to give all**  **9 the energy and ice hardness data. 10 So in 2013, and 14, there should be**  **11 a full batch of data that we can look at and 12 that is not reflected on these charts.**  **13 MR. BROOKMAN: Okay, thank you. 14 And Detlef, you had a follow-up question.**  **15 MR. WESTPHALEN: Yes, the follow-up 16 question was you mentioned that, I think, you**  **17 mentioned a number, eight percent of your 18 units that use more energy than these baseline**  **19 levels. Is that what you were saying? 20 MR. SCHAEFER: That is correct.**  **21 MR. BROOKMAN: Thank you, Stephen. 22 Have we resolved this -- these** 

### Page 79

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 questions about data? Detlef, if you’re 2 clear, the data you received from AHRI that was**  **3 through 2012. 4 MR. WESTPHALEN: Initially through**  **5 2012 and recently, we updated that and it would 6 not have shown a very different trend.**  **7 MR. BROOKMAN: Okay, okay. We’re 8 moving on now.**  **9 MR. WESTPHALEN: So Technology 10 Assessment, DOE identified technology**  **11 assessments from a variety of sources, 12 literature review, manufacturer information,**  **13 looking at the equipment purchased by DOE to 14 see what design options are in those pieces of**  **15 equipment, comment and input from 16 stakeholders.**  **17 During the NOPR phase, DOE collected 18 additional information. We mentioned the**  **19 alternative refrigerants. At times, you 20 know, there are comments that alternative**  **21 refrigerants such as hydrocarbons should be 22 considered in the analysis but they are not** 

### Page 80

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### SNAP approved so we did not consider them as **2** 

### a design option. **3** 

### And Chapter 3 of the NOPR TSD **4** 

### contains a more detailed discussion of all **5** 

### these issues. **6** 

### This is again a -- **7** 

### MR. BROOKMAN: We have a question. **8** 

### Your name please? **9** 

### MR. DESHETLER: Scott DeShetler, **10** 

### Ice-O-Matic. **11** 

### Just a point of clarification, did **12** 

### DOE actually put their hands on or test ice **13** 

### machines in any shape or form? **14** 

### MR. WESTPHALEN: We did put our **15** 

### hands on and test ice makers. We had **16** 

### third-party contractors test ice makers and we **17** 

### measured things other than energy so that we **18** 

### understand how they’re operating. **19** 

### MR. SCHAEFER: Additional question. **20** 

### MR. BROOKMAN: Yes, Stephen? **21** 

### MR. SCHAEFER: Stephen Schaefer. **22** 

### You’re saying that you tested the

### Page 81

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### units. Did you actually test them with all **2** 

### the parts specified inherent to validate the **3** 

### actual energy use considered for these levels? **4** 

### MR. WESTPHALEN: We had testing -- I **5** 

### don’t think we had -- all right, let me back **6** 

### up. Every design option that passed **7** 

### screening, you know, was involved in some of **8** 

### our testing except for permanent magnet motors **9** 

### for which none of the products that we had **10** 

### available to test had any of those. **11** 

### MR. CYMBALSKY: This is John **12** 

### Cymbalsky from DOE. Let me just add that we **13** 

### test ice makers for lots of different reasons **14** 

### in the program. **15** 

### First, when we developed a test **16** 

### method, we test to make sure it’s repeatable **17** 

### and all that. **18** 

### Second, for the standards analysis, **19** 

### we do testing and tear downs of lots of **20** 

### different units. **21** 

### And then third, we buy and test to **22** 

### enforce the standard.

### Page 82

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 So in all of those three platforms of 2 testing, we have lots of test data on lots of**  **3 different units. 4 MR. BROOKMAN: All right, thanks.**  **5 Yes, okay? Detlef? 6 MR. WESTPHALEN: Okay, back to the**  **7 large chart. I’m not going to get into the 8 details here. Some of these technologies are**  **9 associated with the refrigeration systems. 10 So are associated with reducing thermal load.**  **11 Some are appropriate for batch ice makers, 12 some for continuous, some for air cooled and**  **13 some for water cooled, 14 In the screening analysis, DOE**  **15 screens out technologies that are not suitable 16 for consideration in the engineering analysis**  **17 due to these four criteria, technological 18 feasability, practicability to manufacture**  **19 install and service, impacts on equipment 20 utility or equipment availability and adverse**  **21 impacts on health or safety. 22 Also, we did not consider** 

### Page 83

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### technologies that wouldn’t save energy using **2** 

### the DOE test procedure. The screening is **3** 

### discussed in more detail in Chapter 4 and this **4** 

### is the remaining list of design options now **5** 

### that they have passed screening, they’re **6** 

### called design options, that were considered in **7** 

### the engineering analysis. **8** 

### And at this point, we have a comment **9** 

### box. DOE requests comment on the screening **10** 

### analysis and specifically the design options **11** 

### DOE screened out of the rulemaking analysis. **12** 

### We could, at this point, also take **13** 

### comment on any other technologies that weren’t **14** 

### considered in the process that haven’t been **15** 

### listed yet. **16** 

### MR. BROOKMAN: Frank? **17** 

### MR. MOORE: So, Frank with NAFEM. **18** 

### And to Stephen’s point, when I look **19** 

### at -- and I’m not an engineer if that’s not **20** 

### already been revealed, I’ll just put that on **21** 

### the table -- these technology options here, so **22** 

### there was a real showing up. You have had it

### Page 84

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 your hand, compressor, real showing up, you 2 hand, condenser and you built that machine to**  **3 see that it could perform as you were 4 recommending in the rule?**  **5 MR. WESTPHALEN: We did not build 6 machines. We’re not cut and try, you know.**  **7 MR. MOORE: So but can you give a 8 model number for each one of those things, at**  **9 least one model number that I could go back 10 today? I’m just trying to get a sense.**  **11 Again, I’m not an engineer. 12 MR. WESTPHALEN: If you’d like a**  **13 model number, you know, I don’t have them in 14 my back pocket, but --**  **15 MR. MOORE: But they are 16 commercially available right now?**  **17 MR. WESTPHALEN: Certainly, yes, 18 they’re all commercially available.**  **19 MR. MOORE: Okay. All right. I 20 was just trying to get a sense. Okay.**  **21 MR. BROOKMAN: Yes, Chris? 22 MR. SALATINO: As far as your** 

### Page 85

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 testing evaluation, was it -- can you confirm 2 what the rating was done at so from an**  **3 electrical supply standpoint, from an 4 environmental condition, was it done at one**  **5 rating point or across an envelope? 6 MR. WESTPHALEN: We conducted our**  **7 testing according to the DOE test procedure 8 which, you know, ha the, you know, references**  **9 the AHRI and ASHRAE test procedures at the 10 90/70 condition.**  **11 MR .BROOKMAN: So is that multiple 12 test data points or is that a single?**  **13 MR. WESTPHALEN: That means 90 14 Fahrenheit air temperature and 70 Fahrenheit**  **15 in the water temperature at one condition. 16 MR. BROOKMAN: Okay, yes, Stephen.**  **17 MR. SCHAEFER: Yes, Stephen 18 Schaefer.**  **19 It shows here increased surface 20 area, one of the parts of the engineering**  **21 analysis showed that there would be a 50 22 percent increase in evaporator surface area** 

### Page 86

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### with only a ten percent increase in cost. **2** 

### Most of our evaporators are stainless steel **3** 

### with copper tubing, so I’d really like to see **4** 

### how we can go from a one foot evaporator up to **5** 

### a one and a half foot with only a one dollar **6** 

### increase in cost. **7** 

### MR. WESTPHALEN: I mean, we have, **8** 

### you know, manufacturing cost modeling tools **9** 

### which we use to develop the cost estimates. **10** 

### We visited, you know, the manufacturers, **11** 

### looked at the, you know, the production **12** 

### equipment, the way the components were **13** 

### fabricated. **14** 

### We developed cost estimates for, you **15** 

### know, a series of reversed engineered ice **16** 

### makers and, you know, sent that information **17** 

### for those manufacturers that we were in touch **18** 

### with under nondisclosure agreements to those **19** 

### manufacturers for comment on the costs that we **20** 

### estimated and also the cost of the components **21** 

### and tried to get feedback in that fashion and **22** 

### we did receive some feedback and we

### Page 87

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 incorporated that back into the analysis. 2 MR. BROOKMAN: George?**  **3 MR. PARSONS: Yes, George Parsons, 4 Ice-O-Matic. I have two questions.**  **5 The first one would be a follow-up to 6 what we just talked about terms of evaporator**  **7 surface area. In the component cost, did you 8 take into account the amount of money that will**  **9 have to be spent from a capital aspect for all 10 of us as manufacturers completely retool our**  **11 factories to build larger evaporators? 12 MR. WESTPHALEN: Well, the capital**  **13 costs and also the R&D cost, you know, is 14 generally treated as, you know, part of the**  **15 manufacturer markup, the 1.25 which includes 16 historical levels of, you know, R&D and**  **17 capital, etc. 18 And then the manufacturer impact**  **19 analysis considered different levels of, you 20 know, markup that the manufacturers may be**  **21 able to see in the market downstream of a 22 rulemaking.** 

### Page 88

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 Now DOE could potentially consider 2 different scenarios of markup and including**  **3 different than historical levels of capital 4 investment and, you know, so all those factors**  **5 are interrelated and if DOE then said okay, the 6 manufacturer’s selling price will be higher**  **7 because you’re including some of that in the, 8 you know, in the customer price. Then, you**  **9 know, the manufacturer impact assessment will 10 show mitigated impacts.**  **11 So, you know, it kind of goes hand in 12 hand. It is considered an indirect level and**  **13 it could be considered more directly. 14 MR. PARSONS: I would propose that**  **15 for many of us, it would need to be looked at 16 directly because spending capital dollars on**  **17 that tooling is not something that’s planned 18 each and every year. It’s very discrete.**  **19 My second question would be around 20 compressor and just the base of improved**  **21 compressor efficiency. When you talk about 22 improved EER, did you actually take an** 

### Page 89

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 existing ice machine, pull that compressor 2 out, put a new compressor in with a proposed**  **3 EER increase from one of the suppliers and test 4 it?**  **5 Because we’ve got lab data that would 6 show and substantiate that a rough 12 percent**  **7 increase in EER at the compressor level only 8 results in less than a 3 percent increase in**  **9 efficiency in the ice machine. 10 MR. WESTPHALEN: We’ve received**  **11 similar information in our discussions with 12 manufacturers and we did obtain information**  **13 that there are some compressors that performed 14 better in terms of, you know, you see the**  **15 benefits downstream in the ice maker than 16 others and we restricted our analyses to these**  **17 compressors that, you know, that we have heard 18 are appropriate for use in ice makers.**  **19 MR. BROOKMAN: But George, and 20 anyone else, that sort of detailed comment, of**  **21 course, the Department would like that in 22 writing with as much data and backup as you can** 

### Page 90

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### supply. **2** 

### Frank and then back to Scott. **3** 

### MR. MOORE: Yes, just real quick and **4** 

### I don’t want to digress but the answer to the **5** 

### question was no, you did not put that other **6** 

### compressor in that existing machine and test **7** 

### it? **8** 

### MR. WESTPHALEN: That is correct. **9** 

### MR. BROOKMAN: Scott? **10** 

### MR. BINGHAM: Yes, just quick **11** 

### statements. Scott Bingham. **12** 

### I would kind of agree with George, **13** 

### that it’s a refrigeration system and it’s not **14** 

### a plug-n-play with components. **15** 

### And then the other issue is with a **16** 

### again, from my standpoint, a continuous style **17** 

### ice maker or evaporator can either get a **18** 

### cylinder can either get longer or higher **19** 

### diameter, both of which would push on the **20** 

### envelop of the machine and the larger diameter **21** 

### would increase the required portion. **22** 

### However, the auger motor, which

### Page 91

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 would again increase the power consumption of 2 the machine.**  **3 MR. BROOKMAN: Okay, thank you. 4 Robert?**  **5 MR. WILKINS: Robert Wilkins, 6 Danfoss.**  **7 Is this the point or not to discuss 8 the trade-off between compressor efficiency**  **9 and cost increase? Or if it’s going to be 10 discussed later I’ll hold my question.**  **11 MR. WESTPHALEN: Well, it will be 12 covered in the engineering analysis.**  **13 MR. WILKINS: So we’ll have an 14 opportunity at that time to discuss that?**  **15 MR. WESTPHALEN: Yes. 16 MR. WILKINS: Okay, thank you.**  **17 MR. BROOKMAN: Additional comment 18 on screening analysis?**  **19 Okay, yes, Stephen? 20 MR. SCHAEFER: One last question.**  **21 Looking at the improved compressor 22 efficiency, and all this, was this back in 2012** 

### Page 92

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### data or is that the data that we’re looking at **2** 

### right now? And we might be looking at that **3** 

### we’ve already made these changes by 2014. **4** 

### MR. WESTPHALEN: I think the last **5** 

### bit of information we received from **6** 

### manufacturers on this topic was probably in **7** 

### 2012, yes. **8** 

### MR. SCHAEFER: Thank you. **9** 

### MR. BROOKMAN: So that’s the kind of **10** 

### comment, right, very detailed comment. **11** 

### MR. SCHAEFER: Yes. **12** 

### MR. BROOKMAN: Okay, thanks **13** 

### Stephen. **14** 

### We’re at a natural break point here. **15** 

### It’s now 10:35. Let’s take a break for 15 **16** 

### minutes which means we’ll resume at 10:50 in **17** 

### this room. **18** 

### Most of you are familiar with the **19** 

### drill here in DOE. You must wear this badge, **20** 

### it must be visible on you. **21** 

### There are restrooms on both ends of **22** 

### the hall.

### Page 93

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 If you want coffee, please go quickly 2 to the Dunkin Donuts shop which is on the**  **3 ground floor. Go to the elevator, go down to 4 the ground floor and the coffee shop’s about**  **5 just where we are on the opposite side of the 6 hallway. Okay?**  **7 So we’ve had a good start on the day 8 and we’ll resume at 10:50 and for those of you**  **9 joining us via the web, we’re glad you’re 10 listening in. We’ll resume at 10:50.**  **11 (Whereupon the foregoing matter went 12 off the record at 10:25 a.m. and went back on**  **13 the record at 10:53 a.m.) 14 MR. BROOKMAN: Okay, please take**  **15 your seats. Yes, let’s resume, please take 16 your seats.**  **17 Okay, I have clarified that the 18 folks, that the web connection’s still working**  **19 so that’s positive and Chris had a question he 20 wanted to return to some content we covered**  **21 before the break. 22 Microphone please.** 

### Page 94

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 MR. SALATINO: Chris Salatino, 2 Scotsman Ice Systems.**  **3 Quickly, as far as all the components 4 that were identified in the evaluation, can**  **5 you confirm which ones were actually tested in 6 a unit? I know you had mentioned that the**  **7 compressor was not. 8 MR. BURGOS: Which ones were**  **9 actually tested in the unit? 10 MR. SALATINO: Yes.**  **11 MR. BURGOS: Well, we did the 12 evaluation --**  **13 MR. BROOKMAN: This is Javier 14 speaking.**  **15 MR. BURGOS: Sorry, this is 16 Javier from Navigant Consulting.**  **17 What we did is we did testing of 18 commercially available ice makers so any of**  **19 the design options that were available within 20 those ice makers were included in that**  **21 testing. 22 So, Chris does that answer your** 

### Page 95

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 question? 2 MR. BROOKMAN: Right, so at the**  **3 component level I thought perhaps. 4 MR. SALATINO: Yes, and so the**  **5 components identified here, were they 6 actually reworked into a unit and tested to**  **7 confirm the efficiency improvement that has 8 been set forth in the NOPR?**  **9 MR. BURGOS: no, they were not. 10 MR. BROOKMAN: Frank?**  **11 MR. MOORE: Yes, I just wanted to get 12 that clarification, that’s all.**  **13 MR. BROOKMAN: Thank you. Okay. 14 MR. MOORE: Okay.**  **15 MR. BROOKMAN: Now we’re moving on 16 to the Engineering Analysis.**  **17 MR. BURGOS: All right, great. My 18 name’s Javier Burgos. I’m a consultant for**  **19 Navigant and I’m here to present the 20 Engineering Analysis.**  **21 I think just to start off, I want to 22 thank all the stakeholders, particularly** 

### Page 96

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### manufacturers who have been working with us **2** 

### throughout the NOPR process. I think we’ll **3** 

### enjoy continuing working with you and also **4** 

### look forward to any comments that you have on **5** 

### this. **6** 

### All right, this is where we are in the **7** 

### process, the engineering analysis. The **8** 

### engineering analysis will serve as one of the **9** 

### main inputs to the LCC, the NIA and the MIA **10** 

### analysis. **11** 

### Most of you are probably pretty **12** 

### familiar with this but the purpose of the **13** 

### engineering analysis is to establish the **14** 

### cost-efficiency curves, which basically **15** 

### establishes a relationship between cost **16** 

### increases and energy savings for design **17** 

### options that were analyzed. **18** 

### Analyses that go into this **19** 

### engineering analyses include reverse **20** 

### engineering of units, includes testing of **21** 

### commercially available units as well as **22** 

### testing of components once they get back

### Page 97

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### within our lab. **2** 

### It includes the discussions with **3** 

### manufacturers, both component manufacturers **4** 

### and in some cases, it does include energy **5** 

### modeling of units. **6** 

### All right, I’ll start off by saying, **7** 

### you know, most of the details covered here are **8** 

### covered extensively in Chapter 5 of TSD **9** 

### Analysis. But I’ll start off talking about **10** 

### the data collection efforts that DOE underwent **11** 

### during the engineering analysis. **12** 

### Now at the start of NOPR analysis, **13** 

### DOE performed a number of data collection **14** 

### efforts, one was already discussed by Detlef **15** 

### which was that data at the DOE database **16** 

### comprised of lots of different model ratings **17** 

### like condenser water use, harvest rates and **18** 

### retail costs. **19** 

### One of the other steps that we also **20** 

### took was performing testing and reverse **21** 

### engineering of 22 additional automatic ice **22** 

### maker units. On top of 19 that were looked at

### Page 98

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 during the preliminary analysis, that led to 2 a total of 41 different ice makers that we had.**  **3 These were all scattered throughout a bunch of 4 different equipment classes and also include**  **5 high efficiency as well as baseline units. 6 In addition, DOE also did some**  **7 exploratory testing, especially looking at 8 the issue of condenser temperature versus**  **9 energy use and the effects, you know, varying 10 condenser temperature might have including**  **11 the harvest energy use as well as looking at 12 the energy savings provided by some components**  **13 such as commercially available drain water 14 heat exchangers.**  **15 This is the list of units that were 16 analyzed during the engineering analysis.**  **17 Units in the middle are the ones that are 18 purchased for the preliminary analysis. The**  **19 ones on the right were the ones purchased for 20 the NOPR analysis.**  **21 As you’ll see, during the NOPR 22 analysis, you know, DOE tested lots of** 

### Page 99

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 different units, some of them in some new 2 equipment classes that were looked at and some**  **3 of them in some existing product classes to 4 gain a further understanding.**  **5 MR. SCHAEFER: I have a question. 6 MR. BURGOS: Sure.**  **7 MR. BROOKMAN: Stephen? 8 MR. SCHAEFER: Stephen Schaefer,**  **9 Hoshizaki America. The question is, looking 10 at this analysis, why are there so many zeros**  **11 in the different areas? How could you do an 12 accurate assessment of the preliminary**  **13 analysis or testing without actually having 14 units available.**  **15 MR. BURGOS: DOE conducted testing 16 of 12 of -- DOE produced cost efficiency curves**  **17 for 12 different equipment classes. In the 18 end, those were the ones that were based off**  **19 of all those engineering analyses. 20 The rest were folded into the**  **21 downstream analyses, basically pairing cost 22 efficiency curves with the equipment that** 

### Page 100

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 was, you know, that was similar to what was 2 already analyzed.**  **3 MR. SCHAEFER: So to further go over 4 this, the units were purchased but then the**  **5 curves were made up afterwards and then you 6 realized that you didn’t have the units or did**  **7 you just go and not actually purchase the units 8 knowing these curves?**  **9 My question is why are there so many 10 holes here where there was not -- no one else**  **11 has done? 12 MR. CYMBALSKY: I’ll answer that.**  **13 MR. BROOKMAN: John Cymbalsky. 14 MR. CYMBALSKY: So traditionally in**  **15 our rulemakings we don’t necessarily purchase 16 every single permutation or product class**  **17 that’s out there. Clearly, you can do some 18 scaling from class to class if you get one of**  **19 these IMA-A-Small-Cs you may not have to buy 20 a large one to do some engineering scaling of**  **21 product to get you onto that cost efficiency 22 curve.** 

### Page 101

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### So, you know, I won’t speak to what **2** 

### the engineers did here, but I’m sure they **3** 

### thought very hard about which ones to purchase **4** 

### and which ones were more important to purchase **5** 

### and which other ones could be scaled from the **6** 

### testing that we did on representative **7** 

### products. And so this type of thing is done **8** 

### all the time like motors for example. We **9** 

### don’t -- if we purchased every type of motor **10** 

### out there, you know, we wouldn’t be able to **11** 

### afford the rest of what we want to do. **12** 

### So I think here you could see we’ve **13** 

### purchased quite a number of units to test and **14** 

### I think these are very representative. **15** 

### If you’d like to point out something **16** 

### from this slide in your comment that want we **17** 

### could do from engineering scaling, that’s not **18** 

### appropriate based on this. We’d love to hear **19** 

### about it. **20** 

### MR. BROOKMAN: Stephen? **21** 

### MR. SCHAEFER: Just as a statement **22** 

### from Hoshizaki America and probably from

### Page 102

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 others, just looking at this large units 2 perform differently that small units. The**  **3 compressors and condensers marry together in 4 a different way across the board.**  **5 So maybe in the future, we can offer 6 our machines as, you know, testing machines.**  **7 We have people test our units across the nation 8 for different purposes whether it’s end-users**  **9 or whatnot. 10 So maybe in the future, we can offer**  **11 units on loan or, you know, just to test for 12 this purpose.**  **13 MR. BROOKMAN: So let me note that 14 DOE’s pretty clear on its deadline in this**  **15 case. 16 MR. CYMBALSKY: So we certainly**  **17 accept the donations to test for our analysis. 18 We’ve, you know, we’ve got that from other**  **19 manufacturers for other rulemakings. 20 You know, it’s some of the commercial**  **21 equipment in particular is not easy for us to 22 purchase sort of blindly, particularly if** 

### Page 103

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 we’re doing assessment testing. It’s 2 sometimes hard to get our hands on it.**  **3 But you know, we try our hardest to 4 be representative in what we test and tear down**  **5 to make sure that, you know, the curves that 6 we create here are representative of all the**  **7 product classes. But if you think there’s 8 something we missed, please, you know, submit**  **9 the comment. 10 MR. BROOKMAN: Yes, I guess, yes,**  **11 Chris? 12 MR. SALATINO: Sorry, Chris**  **13 Salatino, Scotsman Ice. 14 A quick question. In the purpose**  **15 you say characterize manufacturer production 16 costs versus efficiency for higher efficiency**  **17 ice maker equipment. The definition of 18 higher efficiency?**  **19 MR. BURGOS: Anything above the 20 current baseline as it’s defined. So what we**  **21 do is we characterize the full manufacturing 22 production cost of making the baseline unit** 

### Page 104

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 and then we aggregate the costs to the 2 manufacturer on top of that. And that**  **3 includes pretty much anything between 4 baseline all the way up to the max tech. And**  **5 we’ll -- we have a couple of numbers going into 6 what those actual costs were and what the**  **7 actual efficiency level we looked at with a bit 8 more in use.**  **9 All right, so with all this said, 10 with all this data collection, DOE basically**  **11 was able to do three different things. 12 One was attempt to validate and**  **13 adjust the assumptions made within the 14 preliminary analysis.**  **15 One was also done to also expand the 16 analysis. Within the preliminary analysis,**  **17 DOE analyzed and produced nine different cost 18 efficiency curves. Within NOPR, we actually**  **19 did this for 12 different cost efficiency 20 curves.**  **21 And finally, with all this data 22 analysis, DOE is also able to explore some** 

### Page 105

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### alternative analysis pathways, basically **2** 

### provide a look at alternatives for potentially **3** 

### doing this engineering analysis. **4** 

### MR. MOORE: Is -- **5** 

### MR. BROOKMAN: Frank? **6** 

### MR. MOORE: Frank with NAFEM. **7** 

### Is that, and again, the alternative **8** 

### analysis pathways, I’m just trying to get a **9** 

### sense of what that is. And is that detailed **10** 

### in the NOPR? Do we -- **11** 

### MR. BURGOS: Yes. **12** 

### MR. MOORE: - can we find that? **13** 

### MR. BURGOS: Yes. Those are **14** 

### detailed within both the NOPR and the TSD and **15** 

### we’ll go over a bit of them right now, **16** 

### actually. So -- **17** 

### MR. BURGOS: All right, so in terms **18** 

### of all these analysis pathways that DOE looked **19** 

### at, within the preliminary analysis, DOE **20** 

### performed a design option analysis which **21** 

### included energy modeling of the design options **22** 

### in order to estimate energy savings as well as

### Page 106

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### cost modeling using reverse engineering to **2** 

### estimate the cost increases. **3** 

### Now within the NOPR analysis, DOE **4** 

### considered three different alternative **5** 

### analysis approaches. **6** 

### One, DOE considered proceeding with **7** 

### design option analysis while incorporating **8** 

### both feedback from stakeholders and from all **9** 

### the additional test data. And we received a **10** 

### lot of that both from our own testing and from **11** 

### feedback from stakeholders. **12** 

### Two, DOE considered an empirical **13** 

### analysis that relied solely on test data and **14** 

### reverse engineering costs with the main **15** 

### purpose would be to identify the cost of going **16** 

### to a higher efficiency when analyzing two **17** 

### physical products at two different efficiency **18** 

### levels. **19** 

### And three, DOE also considered a **20** 

### retail cost analysis based on its market **21** 

### database looking for trends which indicated **22** 

### increased retail costs for increased energy

### Page 107

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### efficiency. **2** 

### And we’re probably getting a bit **3** 

### ahead of ourselves but, you know, in the end, **4** 

### DOE concluded after, you know, looking and **5** 

### analyzing all three different methods that the **6** 

### revised design option analysis was the only **7** 

### real viable approach to developing meaningful **8** 

### results and developing meaningful cost **9** 

### impacts for the model design options. **10** 

### On this slide, I’ll go over a little **11** 

### bit of the two alternative engineering **12** 

### approaches that, you know, were ultimately not **13** 

### used. **14** 

### One, I’ll start with the second one **15** 

### is the retail cost analysis. Now within its **16** 

### data collection, when DOE collected data for **17** 

### its database that Detlef alluded to, we **18** 

### collected energy use data, harvest use data, **19** 

### size impacts, condenser water use data, **20** 

### potable water use data and retail prices as **21** 

### well. And ultimately, we came up with a set **22** 

### of 470 different models that were currently

### Page 108

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 out there on the market today. 2 And using this data set, we were able**  **3 to analyze it from a bunch of different 4 perspectives. Ultimately, you know, when we**  **5 crunched the numbers, when we tried to 6 establish really what’s the correlation**  **7 between a retail cost and an energy 8 efficiency.**  **9 DOE found that there was, you know, 10 little to no trend in the retail costs that**  **11 matched what -- that basically showed a trend 12 with energy efficiency. And in some cases, it**  **13 showed a negative cost trend. 14 MR. BROOKMAN: Daryl?**  **15 MR. ERBS: So I think that’s an 16 interesting study you did and I’m glad you did**  **17 that. I guess from my perspective, I think it 18 helps to point out that from a customer, from**  **19 and end-user perspective, there are many 20 different reasons that they find value in an**  **21 ice machine. It’s not just about energy 22 efficiency.** 

### Page 109

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 Your classes are fairly broad and so 2 you would find, if you did a more detailed**  **3 analysis within those classes, some of the 4 time, it may be because there’s a particular**  **5 application need that drives and ice machine 6 to fit a configuration size, a physical volume**  **7 size, something like that that may constrain 8 its energy efficiency.**  **9 Those are real needs. I mean the 10 market generally for products is pretty**  **11 efficient. So people pay more for less 12 efficiency for other reasons. It’s not that**  **13 they don’t have a basis to compare all of the 14 different ice machine options.**  **15 In fact, if you look at the Internet, 16 it’s done a wonderful job for the end customer**  **17 to be able to very quickly ascertain what all 18 the different options are for an ice machine**  **19 to fit their need. 20 And this finding that you comment on**  **21 here, I think is, you know, something that we 22 need to be careful that when we put in place** 

### Page 110

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### new efficiency standards, we don’t drive them **2** 

### purely on the basis of, you know, what’s **3** 

### technically possible in a particular **4** 

### configuration that fits into one of your **5** 

### categories, one of your equipment classes **6** 

### because there maybe some models out there that **7** 

### just can’t get there and there’s real need for **8** 

### those models. **9** 

### MR. BROOKMAN: Detlef? **10** 

### MR. WESTPHALEN: Detlef WESTPHALEN. **11** 

### Daryl, thanks for your comments. **12** 

### You know, I don’t know if we should dwell too **13** 

### much on these alternative analyses that were **14** 

### considered. I remember when we were here in **15** 

### the preliminary analysis Karim came up and **16** 

### asked us, did you conduct a retail cost **17** 

### analysis? And my answer was no we haven’t, **18** 

### but we could. And so we have and didn’t show **19** 

### us anything. **20** 

### And also in light of all the concern **21** 

### about the approach we used for the preliminary **22** 

### analysis, we said, okay, we ought to consider

### Page 111

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### alternative ways to do this and we did try an **2** 

### efficiency level analysis which is a very **3** 

### commonly used in these DOE rulemakings and, **4** 

### you know, Javier can get into the details but **5** 

### we didn’t find any meaningful results in that **6** 

### efficiency level analysis either. **7** 

### MR. BROOKMAN: Okay, Daryl? **8** 

### MR. ERBS: So Daryl Erbs with **9** 

### Manitowoc. My point is, I think you did find **10** 

### something. It wasn’t what you would hope **11** 

### maybe to find in terms of a nice strong **12** 

### correlation between efficiency and price **13** 

### level. **14** 

### But my point is, is there’s a really **15** 

### good reason why there isn’t such a strong **16** 

### correlation and it’s not because the market **17** 

### isn’t aware of the options, it’s not because **18** 

### the manufacturers don’t worry about the **19** 

### efficiency for the different models they put **20** 

### out there. There are other causes that lead **21** 

### to that kind of scattered plot that you can’t **22** 

### really fit much of a line to.

### Page 112

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 MR. BROOKMAN: Daryl, you’ve stated 2 your points clearly. Javier, keep going.**  **3 MR. BURGOS: Sure. Not sure if 4 there is too much to add, but you know, I think**  **5 the second approach that was also investigated 6 was an efficiency analysis approach and that**  **7 was basically taking the 41 reverse engineered 8 units that, you know, we purchased and we were**  **9 able to then investigate trends in nine 10 different equipment classes.**  **11 And again, you know, DOE’s main task 12 is to determine what portion of that cost**  **13 different could be attributed to increased 14 energy efficiency? And when DOE ran these**  **15 analyses, you know, it basically showed in 16 some cases no trend, in some cases a it shows**  **17 a positive trend and in some cases, the results 18 were negative cost cares.**  **19 And again, DPE wasn’t able to 20 conclude that this was a viable pathway for**  **21 determining cost efficiency curves. 22 And so this leads us to the current** 

### Page 113

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 approach. The last one that we look and the 2 one that was ultimately adopted was adjusting**  **3 the preliminary analysis approach in response 4 to the testing and feedback that we received.**  **5 As you noted, there’s a lot of 6 additional testing within the NOPR phase both**  **7 the high efficiency models and to lower 8 efficiency models as well as some testing to**  **9 account for things like, you know, lower 10 condensing temperatures, and adjusting**  **11 component energy use. 12 As well, DOE also made cost**  **13 adjustments based on discussions with 14 component manufacturers and equipment**  **15 manufacturers some of the other idea. 16 And then this is the flow diagram**  **17 that basically shows, you know, how the 18 information flows between different analyses.**  **19 Again, you know, it’s different sub-analyses 20 that were conducted include energy testing,**  **21 manufacturer interviews, reverse engineering 22 and vendor interviews. All that information** 

### Page 114

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 goes into one, the energy model and B, the 2 manufacturing cost models.**  **3 And, you know, ultimately that all 4 results in the cost efficiency curves.**  **5 Are there any questions on the 6 approach at this point? Otherwise, we’ll**  **7 jump into some of these design options. 8 MR. BROOKMAN: Frank?**  **9 MR. MOORE: So this is a flow 10 diagram, again, I’m just trying to -- you know,**  **11 I know I’ve got a lot of homework to do here 12 -- but this is the flow diagram he revised**  **13 design option analysis that was ultimately 14 selected?**  **15 MR. BURGOS: Yes. 16 MR. MOORE: Okay, and that’s how you**  **17 -- that’s what you used to arrives? And I 18 think you also had a manufacturer impact model**  **19 somewhere up there. Is that one and the same? 20 MR. BURGOS: Yes, that’s one and the**  **21 same. 22 MR. MOORE: One and the same, okay.** 

### Page 115

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 MR. BURGOS: Yes. 2 MR. MOORE: Now did -- in your**  **3 interviewing with manufacturers, did you vet 4 that with them and say does this look right and**  **5 let’s run some numbers and beta test that? 6 MR. BURGOS: Well, you know,**  **7 clarifing one point I just made. 8 Manufacturing impact analysis is actually**  **9 different from the manufacturing cost model. 10 MR. MOORE: And it’s not there, it’s**  **11 something else? 12 MR. BURGOS: No, that’s different**  **13 process that happens downstream of the 14 engineering analysis. But --**  **15 MR. MOORE: But so to that point, the 16 manufacturing cost model, did you all at any**  **17 point in time sit down with these 18 manufacturers and runs some numbers and say,**  **19 yes, that looks right? 20 MR. BURGOS: Yes.**  **21 MR. MOORE: That’s suggested, 22 MR. BURGOS: Do we have the final** 

### Page 116

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 MPCs that went into producing these costs? I 2 mean a lot of the discussions with the**  **3 manufacturers and a lot of the inputs happened 4 under NDA and so we’re not allowed to disclose**  **5 those. 6 MR. MOORE: I’m just trying to**  **7 figure out how the one dollar increase for 8 another foot of copper came out of that cost**  **9 model. 10 MR. BURGOS: Well, we did validate**  **11 the costs which the manufacturers, but you 12 know, I think we’re also open to any comments**  **13 you have on the costs you’re seeing right now. 14 MR. BROOKMAN: Daryl?**  **15 MR. ERBS: Yes, Daryl Erbs with 16 Manitowoc Ice. I’m wondering if you did any**  **17 testing of your manufacturing cost models 18 maybe with two different sizes ice machines or**  **19 something because from my perspective and when 20 I went through the TSD, it doesn’t match what**  **21 our costs are, especially in the case where the 22 size of the ice machine is growing.** 

### Page 117

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 There’s a significant disconnect. 2 I know we had conversations, it was a long time**  **3 ago so I can’t remember exactly what we may or 4 may not have shared with you. But from my**  **5 perspective, something is incorrect with the 6 cost model and I’m not sure what we’ll do in**  **7 the way of how much detail we’ll share in the 8 written comments, but from my perspective, the**  **9 impact, particularly in cases where an 10 evaporator is getting larger, some other**  **11 change is occurring that requires the cabinet 12 to also change. There’s a big disconnect.**  **13 MR. BROOKMAN: You referenced that 14 in your opening remarks.**  **15 Okay. Are we ready to move on now? 16 We’re moving on.**  **17 MR. BURGOS: I think we’ll take any 18 comments that you have.**  **19 All right. The next section 20 concerns some of the design options that we**  **21 looked at. This table is going to be pretty 22 similar to the one Detlef showed. Basically,** 

### Page 118

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 it just breaks down some of the these cost 2 options in the different equipment costs that**  **3 they’re analyzed into. 4 So something like condenser water**  **5 flow can only be applied to water cooled units, 6 something like high efficiency auger motors**  **7 can only be applied to continuous products. 8 Now the next two slides are going to**  **9 briefly describe some of the analyses that we 10 performed for each design option that we**  **11 considered. Additional details of this, of 12 course are available in Chapter 5 of the TSD.**  **13 And I think the thing, I’ll try to 14 stress is that, you know, DOE sought to base**  **15 analysis of each option on the data it 16 collected whether it was test data, whether it**  **17 was physical data from the reverse 18 engineering, whatever is market data in terms**  **19 of some of the efficiencies that we’re looking 20 at.**  **21 We have notes here on drain water 22 heat exchangers, condenser water flows,** 

### Page 119

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### increased water cooled condenser service area **2** 

### which was what was considered in lieu of **3** 

### condenser water flow as well as for chassis **4** 

### size increases. **5** 

### And I know we had a question as well **6** 

### on compressors. And that’s on the next slide **7** 

### but for anyone who has any questions in terms **8** 

### of some of these design options. **9** 

### MR. ERBS: Yes, Daryl Erbs, **10** 

### Manitowoc. **11** 

### I did have a comment on the **12** 

### condenser, water cooled condenser surface **13** 

### area. It’s not just a matter of space **14** 

### available but we also run into an issue where **15** 

### putting more surface area and reducing the **16** 

### condensing temperature at the rated condition **17** 

### can lead to the inability of the ice machine **18** 

### to harvest the ice at a low inlet water **19** 

### temperature condition. **20** 

### And so when you get into northern **21** 

### regions during the winter months and people **22** 

### use ice all year round, and it really comes

### Page 120

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### down to kind of model by model. **2** 

### We have to run testing and determine **3** 

### what the minimum condensing temperature that **4** 

### we can operate reliably at and so that becomes **5** 

### a constraint that I’m not sure was really **6** 

### properly analyzed. **7** 

### MR. BURGOS: Mind if I ask a **8** 

### question? Do you have any specific models **9** 

### that would be, I guess southern region models? **10** 

### Does this apply to -- **11** 

### MR. Erbs: No, we can’t afford to **12** 

### create special models for northern regions. **13** 

### I’m just saying that we may not be able to apply **14** 

### some of the potential increases in water **15** 

### cooled condenser surface area because of that **16** 

### reason. **17** 

### MR. BROOKMAN: Robert? **18** 

### MR. WILKINS: Robert Wilkins, **19** 

### Danfoss. Thanks Javier. **20** 

### In your point about chassis-size **21** 

### increases and obviously when you have a larger **22** 

### condenser, it forces to you a larger chassis.

### Page 121

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### The condenser costs more than the chassis **2** 

### itself. It’s also larger. But have you **3** 

### considered the applied cost of larger chassis? **4** 

### MR. BURGOS: Yes. Well let me make **5** 

### sure I got your question right. So did we **6** 

### incorporate the cost of the larger chassis **7** 

### into the cost of the design option? Is that **8** 

### your question? **9** 

### MR. WILKINS: I don’t think so. **10** 

### I’m always amazed when I go into a **11** 

### restaurant kitchen or fast food store kitchen **12** 

### how compact everything is and the people are **13** 

### scrambling around this equipment and it’s very **14** 

### compact. **15** 

### And so if we have to increase the size **16** 

### of the chassis to increase the efficiency, that **17** 

### adds more sheet metal and frame and I **18** 

### understand you have included that in the **19** 

### analysis. **20** 

### But what about the applied costs that **21** 

### now the restaurant has to have more floor space **22** 

### to fit this 30 inch unit intro or more ceiling

### Page 122

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 space that the 20 inch unit -- 22 inch unit or 2 whatever it is won’t fit.**  **3 And I think, you know, that seems to 4 me there are two dimensions to the issue. One**  **5 is the new applications, the new MacDonald’s 6 store is going to have to allocate more floor**  **7 space for these larger units and that cost 8 should be imbedded in here in this analysis.**  **9 But more importantly when that old 10 15-year-old unit that’s 22 inches fails, and**  **11 now I’ve got to put a 30 inch unit into the 22 12 inch slot. What about the cost to retrofit**  **13 the whole kitchen to enable that to happen. 14 I think that’s a substantial figure**  **15 and I’m reminded of when we went from 10 to 13 16 SEER in air conditioning. The biggest issue**  **17 we had was in the retrofit markets, 80 percent 18 retrofit, the unit simply wouldn’t fit in the**  **19 closet. And we had huge amount of costs and 20 here -- and I’ll stop here but the biggest**  **21 issue involved that was so frustrating was 22 that it was inducing people to patch up old,** 

### Page 123

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### inefficient equipment at low, low efficience **2** 

### rather than to upgrade to new efficiency **3** 

### because they couldn’t afford the cost to do it. **4** 

### And I’m hoping you’ve got some way of **5** 

### analyzing the incremental applied costs to **6** 

### these new larger units. **7** 

### MR. BROOKMAN: Yes, Alan seems like **8** 

### he wants to respond. Alan? **9** 

### MR. COOKE: Alan Cooke, Pacific **10** 

### Northwest National Laboratory. **11** 

### We did the life cycle cost and other **12** 

### downstream analyses, part of which was **13** 

### estimating the installation cost which would **14** 

### probably be where this cost you’re talking **15** 

### about would logically be included and we did **16** 

### not include any such costs. **17** 

### So as Doug and others have said **18** 

### already a few times, we encourage you to give **19** 

### us specific comments on this subject. **20** 

### MR. BROOKMAN: Chris? **21** 

### MR. MOORE: Did the DOE engage in -- **22** 

### MR. BROOKMAN: Pardon me, Frank, go

### Page 124

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 ahead. 2 MR. MOORE: Frank, I’m sorry, Frank**  **3 with NAFEM. 4 Just in terms of that, that’s good**  **5 information. But has DOE relied on the 6 manufacturers or are they going to talk to the**  **7 users? The folks that own the restaurants? 8 MR. COOKE: We’ve relied on the**  **9 manufacturers and the other trade groups 10 largely that are here in the room for**  **11 information. 12 MR. MOORE: So the current proposal**  **13 does not include input from the market that 14 we’re building for?**  **15 MR. COOKE: When we developed the 16 installation costs, the repair costs and the**  **17 maintenance cost. We did, try talking to 18 contractors who do the installation and who do**  **19 that kind of maintenance work. 20 We did not talk to hotels or**  **21 restaurants or hospitals. 22 MR. MOORE: Okay, and I just again,** 

### Page 125

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### it gets to be in the written, but try to talk **2** 

### or did talk? **3** 

### MR. COOKE: We talked to a few. We **4** 

### had some luck actually getting them to answer **5** 

### questions. It seemed like the -- when we were **6** 

### honest and told them who we were, which I think **7** 

### is important to do, a lot of them weren’t very **8** 

### interested in answering our questions. **9** 

### MR. BROOKMAN: Okay, thank you, **10** 

### Frank. Now to Chris. **11** 

### MR. RAWALD: OH, pardon me, Doug, **12** 

### and I want to make something clear. This is **13** 

### a public process. We do publish these **14** 

### regulations or the Proposed Rules in the **15** 

### Federal Register so folks are asked to be **16** 

### involved. **17** 

### So the country knows about this and **18** 

### if they want to respond they can. And so if **19** 

### you feel there are folks that are not included, **20** 

### you think, hey, they folks would be interested **21** 

### ion that encourage them to -- **22** 

### MR. MOORE: Well, I appreciate that.

### Page 126

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 Again, I was trying to figure out if in fact, 2 it is incumbent on us and if you all are relying**  **3 on us to engage the rest of the world. 4 MR. BROOKMAN: All right, okay.**  **5 Thank you, Frank. 6 Chris?**  **7 MR. SALATINO: This is Chris 8 Salatino of Scotsman.**  **9 All I want to do is endorse the two 10 comments previous.**  **11 One, the impact of the restaurant and 12 it’s twofold so the restaurant can go one of**  **13 two ways if we have to increase the footprint. 14 They can either stay with the footprint they**  **15 have which then limits them and cooling 16 capacity for beverages which is one of their**  **17 primary profit generators. 18 Or they can then upgrade their**  **19 facility. There’s not a lot of space so that 20 upgrade would include plumbing and electrical**  **21 and possibly relocating existing equipment. 22 So that’s the impact that’s not** 

### Page 127

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 covered in the evaluation usually. But I 2 think it’s important to consider.**  **3 And then the other comment that Daryl 4 had is as far as the evaluation goes, you know,**  **5 we design for a much broader ambient whether 6 it’s not only air and water but also electrical**  **7 supplies. 8 So I think those need to be taken into**  **9 consideration in this evaluation as well. 10 MR. BROOKMAN: Okay. Louis?**  **11 MR. STARR: This is Louis Starr. 12 I question in the chassis increase in**  **13 the chassis size. Was it primarily limited to 14 vertical increase in height or was it also the**  **15 width or did you confirm it to one or the other? 16 MR. BURGOS: So the chassis**  **17 increases that were implemented were 18 implemented in three of the product classes.**  **19 One was the IMH-A-Small-Batch, one was the 20 IMH-A-Medium-Batch, the last one was the**  **21 IMH-A-Water-Small-Batch. And those were 22 confined to height increases.** 

### Page 128

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 Mr. Starr: Okay, so that, in theory 2 the ability there is just limiting the height**  **3 which the thought is, is that there’s more 4 flexibility in that so normally the design**  **5 plan is mostly concerned with the footprint 6 which is the plan view of things.**  **7 So the thought is, is that that 8 there’s more available for the vertical aspect**  **9 to add the height increase in there. So I 10 think that’s a little bit what DOE is thinking**  **11 about. 12 MR. BROOKMAN: Stephen?**  **13 MR. SCHAEFER: Stephen Schaefer, 14 Hoshizaki America.**  **15 And I concur also with the water 16 cooler condenser surface area and chassis size**  **17 increase. We’ve been in a grassroots effort 18 to talk to all our end-users with the help of**  **19 NAFEM, AHRI and the other manufacturers. 20 We’re working together to let them know that**  **21 in could greatly increase the cost of their 22 machines and change the size of their place.** 

### Page 129

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 I implore you all to look the next 2 time you’re in a restaurant or a hotel how much**  **3 space is actually close to the roof. We’re 4 fitting into a very small area as it is and this**  **5 could greatly impact the whole market. So you 6 will be seeing a lot of comments from all our**  **7 end-users. 8 MR. BROOKMAN: Yes, now we’re**  **9 hearing this comment, let’s try not to be 10 entirely duplicative but Daryl, please.**  **11 MR. ERGS: Yes, Daryl Erbs. 12 Manitowoc Ice.**  **13 I just wanted to talk about one 14 particular example that I think is very**  **15 relevant which is drive-throughs and you think 16 about the utility that drive-throughs provide**  **17 to the nation in terms of, you know, in the 18 morning when you want to get your coffee and**  **19 beverage, you know with it. 20 That’s one of those really space**  **21 constrained application where there’s an ice 22 machine that’s sitting on top of an ice** 

### Page 130

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### beverage dispenser and in some cases, we’re **2** 

### talking about very significant investments **3** 

### that people have made. **4** 

### There is really no alternative way to **5** 

### deal with the through-put that a drive-though **6** 

### has to manage and they’re not going to accept **7** 

### less ice capacity because that’s such a source **8** 

### of profit revenue for the ice or for the **9** 

### restaurant that they will not, they not back **10** 

### down from capacity. There’s no physical **11** 

### ceiling space and, you know, people aren’t **12** 

### going to raise the roof line on their **13** 

### restaurants to accommodate a larger ice **14** 

### machine. **15** 

### I think what’ll happen is they won’t **16** 

### replace them. They will fix them for 20 years **17** 

### because it’s the only way to keep their **18** 

### restaurant in business. **19** 

### MR. BROOKMAN: Okay, thank you. **20** 

### Andrew? **21** 

### MR. DELASKI: Let me be clear, **22** 

### Javier, so there’s three out of all the product

### Page 131

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### classes -- **2** 

### MR. BURGOS: Out of the 12? **3** 

### MR. DELASKI: Out of 12, you only **4** 

### consider chassis changes in three. **5** 

### RE. BURGOS: Yes, and the -- **6** 

### MR. DELASKI: And you ruled it out **7** 

### for the others. Why? **8** 

### MR. BURGOS: Yes, the basis for that **9** 

### was we looked at chassis sizes within all the **10** 

### different equipment classes and in those three **11** 

### cases there, we saw an opportunity for chassis **12** 

### size increases based on all the models that are **13** 

### out there on the market. So the growths were **14** 

### basically from baseline unit to a higher **15** 

### efficiency unit. **16** 

### And the larger size is indicative of **17** 

### what the higher efficiency units are at, and **18** 

### they were at. And so basically, (a) the **19** 

### market had opportunity for a chassis size **20** 

### increase and (b) that was a pathway for higher **21** 

### energy efficiency. **22** 

### MR. BROOKMAN: The remaining

### Page 132

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 chassis size -- pardon, backing up. 2 You thought the chassis size**  **3 increase in those three, but the remaining 4 nine, you thought the existing configuration**  **5 or size would accommodate the possible 6 efficiency improvements?**  **7 MR. BURGOS: Right, we did 8 consider some condenser size increases within**  **9 some of these product classes where we do not 10 consider chassis size increase and would have**  **11 occurred within the existing chassis. 12 MR. BROOKMAN: Okay, so now, we**  **13 understand it. Okay, got it. 14 Yes, Scott.**  **15 MR. BINGHAM: So not to belabor 16 chassis size, but another point to consider is**  **17 even if the chassis doesn’t grow, if the 18 components inside grow, that impacts that**  **19 ability to service these machines. 20 Often, they’re right up against the**  **21 roof, right up against a wall and so there’s 22 less ability to service and maintain these** 

### Page 133

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### machines. **2** 

### MR. BROOKMAN: Okay. Good point. **3** 

### Daryl? **4** 

### ERBS: Just quickly, Daryl Erbs, **5** 

### Manitowoc Ice. **6** 

### Just because there’s a taller, 30 **7** 

### inch air-cooled ice making head, even with the **8** 

### same capacity still doesn’t mean that all **9** 

### end-users could accept a larger or a taller ice **10** 

### making cabinet. **11** 

### I think that’s the danger in assuming **12** 

### because there’s taller units out there, that **13** 

### all of them can become taller. **14** 

### MR. BROOKMAN: Right. Okay, we’re **15** 

### moving on now. **16** 

### MR. BURGOS: All right, I’ll get to **17** 

### the second slide. Basically, a lot more of **18** 

### the same but again, the slide covers heat **19** 

### exchanger size increases outside the chassis **20** 

### sizes as well as compressor efficiency **21** 

### improvements and motor efficiency **22** 

### improvements.

### Page 134

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### I think we had a question on **2** 

### compressors. I was maybe waiting for a while. **3** 

### Did we get that? **4** 

### MR. BROOKMAN: Yes, Robert. **5** 

### MR. WILKINS: Yes, it’s Robert **6** 

### Wilkins with Danfoss. **7** 

### We kind of touched on it earlier, but **8** 

### the assumption of the compressor efficiency **9** 

### improvement versus cost improvement. Is that **10** 

### consistent with the assumption that was in the **11** 

### final rule in the commercial refrigeration **12** 

### document? Or if not, what assumptions do you **13** 

### have in there? **14** 

### MR. BURGOS: We have the assumption **15** 

### that’s outlined within the TSD and I believe **16** 

### it’s for a five percent -- maybe I should look **17** 

### at it. I don’t want to get this wrong. But **18** 

### it’s for a -- **19** 

### And I believe somebody actually **20** 

### brought this up a little bit earlier. But I **21** 

### believe it’s ten percent increase in costs for **22** 

### five percent increase in efficiency.

### Page 135

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### MR. BROOKMAN: Maybe you could, at **2** 

### some point, track that down. **3** 

### MR. BURGOS: Sure. Yes, what we **4** 

### have in there, it’s flipped; for ten percent **5** 

### increase in the efficiency relationship **6** 

### yields a five percent increase in cost. **7** 

### MR. BROOKMAN: Okay, Daryl? **8** 

### Robert, did you want to follow on? **9** 

### MR. WILKINS: Yes. **10** 

### If I recall, and I don’t have my **11** 

### documents with me, but that was the initial **12** 

### assumption in the commercial refrigeration **13** 

### docket that you could achieve a ten percent **14** 

### increase in compressor efficiency for a five **15** 

### percent increase in cost. **16** 

### And I remember commenting on that. **17** 

### These are matured technologies. They’ve been **18** 

### around 50 or 60 years. If that sort of **19** 

### efficiency improvement could be made **20** 

### available, it would have -- these guys have **21** 

### been hammering on the compressor **22** 

### manufacturers for decades -- we would have

### Page 136

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 already done it. 2 But I have heard that the final rule**  **3 adjusted that assumption to be a more 4 realistic assumption for a smaller increase in**  **5 efficiency for a cost increase. And I am 6 wondering, is this assumption -- should this**  **7 assumption be the same assumption that you’ve 8 used in the commercial refrigeration docket?**  **9 MR. BROOKMAN: Do you want to 10 respond?**  **11 Okay. Oh yes, Detlef? 12 MR. WESTPHALEN: Just to clarify,**  **13 you know -- 14 MR. BROOKMAN: I don’t think it’s**  **15 on. 16 MR. WESTPHALEN: Detlef Westphalen.**  **17 Just to clarify, in the CRE 18 rulemaking, a baseline compressor efficiency**  **19 was assumed and then a hypothetical ten 20 percent improvement was then postulated as an**  **21 efficiency improvement. 22 In this rulemaking, we restricted** 

### Page 137

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### ourselves to use of compressors that are **2** 

### available in the market that we have seen in **3** 

### ice makers and that we have heard from ice **4** 

### maker manufacturers are acceptable to use in **5** 

### ice makers. **6** 

### Then what remains is, what should the **7** 

### cost relationship be? And we -- I think we **8** 

### requested comment on that item in the **9** 

### preliminary analysis. We also received **10** 

### information regarding compressor costs and it **11** 

### wasn’t clear from that information whether **12** 

### there was any trend with respect to efficiency **13** 

### for those existing compressors. **14** 

### And we know the story is more complex **15** 

### than that and I’m sure we’ll hear more about **16** 

### that. **17** 

### MR. BROOKMAN: Robert? **18** 

### MR. WILKINS: Thank you. Maybe I’m **19** 

### being overly simplistic, but I think I would **20** 

### urge DOE to at least align the assumptions **21** 

### between the two dockets and if you make a **22** 

### different assumption, at least substantiate

### Page 138

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 why you’ve made the additional difference in 2 assumption.**  **3 However, I would say this is a very 4 mature technology. We’ve been making**  **5 reciprocating compressors for ice makers for 6 50 or 60 years and these guys that have been**  **7 hammering on us compressor manufacturers for 8 that entire period of time, please raise your**  **9 energy efficiency. 10 And I can attest from my experience**  **11 that if we could get a ten percent increase in 12 efficiency for a five percent increase in**  **13 cost, it would have happened a long time ago. 14 So I urge you to go back and relook**  **15 that assumption and -- with the mindset of a 16 more realistic assumption.**  **17 MR. BROOKMAN: Daryl and then I’m 18 going to come back to you George.**  **19 MR. ERBS: Yes, I believe we did 20 comment at the preliminary phase and I thought**  **21 we had provided at least commentary. I’m not 22 sure how much data was actually given to you** 

### Page 139

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### where the assumption of, you know, ten percent **2** 

### for five percent was not in line with **3** 

### everything we’ve ever experienced in terms of **4** 

### working with all of the different compressors **5** 

### suppliers that we have. So my position is **6** 

### still that that’s unrealistic. **7** 

### But I wanted to talk about some **8** 

### recent experience that we’ve had. Because of **9** 

### the new Energy Star standards that went into **10** 

### effect, we and I suspect all of the **11** 

### manufacturers in the room, have done a lot of **12** 

### work on how to raise energy efficiency and **13** 

### that’s given us a lot of data in recent **14** 

### history, some of that, you know, only in the **15** 

### last year which actually is, you know, after **16** 

### most of our discussions during the preliminary **17** 

### phase occurred. **18** 

### And I had a specific example and I’ve **19** 

### already put in some additional written **20** 

### comments, but I’ll certainly expand on it. In **21** 

### Table 5.10.8 of the TSD, there was a compressor **22** 

### put in. Actually, I think it was two steps but

### Page 140

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### the total improvement in the EER for the **2** 

### compressor was 13 percent and the modeling **3** 

### that was done said that would lead to a 9.4 **4** 

### percent improvement in ice machine **5** 

### efficiency. **6** 

### Well, we’ve recently done testing on **7** 

### a very similarly sized ice machine, same **8** 

### class, same configuration. The compressor **9** 

### that we tested has a 12 percent higher EER than **10** 

### the current compressor in it, and we were able **11** 

### to obtain a three percent improvement in ice **12** 

### machine efficiency. **13** 

### So there’s a factor of three **14** 

### difference between what a model predicted and **15** 

### what our test data -- now, all we changed was **16** 

### the compressor, so I think it’s a very well **17** 

### controlled experiment. Right? We swapped **18** 

### the compressor out in the same units. We did **19** 

### it in multiple samples. We think we know how **20** 

### to optimize the performance in ice machines. **21** 

### And so, I guess I’m going to suggest **22** 

### that there are some reasons. Now I happen to

### Page 141

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### know in this case, the higher-efficiency **2** 

### compressor had some design characteristics. **3** 

### It wasn’t a direct suction, so thank you for **4** 

### taking direct suction compressors out of **5** 

### consideration. But this one was still **6** 

### designed with a higher-efficiency motor. **7** 

### It had different routing of the gas, **8** 

### so that there was less heating of the **9** 

### discharged gas that leads to a lower discharge **10** 

### temperature. While that lower discharge **11** 

### temperature helps in the, you know, the ASHRAE **12** 

### rating, right, it gives you a better **13** 

### compressor efficiency rating. It really **14** 

### hurts the ice machine in harvest and your model **15** 

### doesn’t really give you a good basis for **16** 

### predicting that effect down to the level of **17** 

### detail that’s required. **18** 

### And my assertion is that there’s a **19** 

### big disconnect between what is assumed on the **20** 

### basis of the DOE models as to the contribution **21** 

### of higher efficiency compressors and, you **22** 

### know, given this is one example so there may

### Page 142

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 be other higher efficiency compressors that do 2 better.**  **3 But I think it’s very, you know, to 4 kind of take the database of compressors out**  **5 there and use that as an assumption to say, yes 6 we can get a 12 percent better compressor and**  **7 it’s going to get nine percent better 8 efficiency. I have data to say that doesn’t**  **9 always happen, okay. 10 Second point. Heat exchanges,**  **11 evaporators, put a 50 percent bigger 12 evaporator in, two things happen that I don’t**  **13 think that have been properly considered in 14 the modeling.**  **15 One is the refrigerant charge goes up 16 significantly. Refrigerant charge is a big**  **17 issue in an ice machine in terms of how you deal 18 with that, particularly during harvest and**  **19 even during ice making. So it may add 20 additional cost factors. I may have to put an**  **21 accumulator in the ice machine where I didn’t 22 need one before.** 

### Page 143

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 Managing that charge becomes 2 problematic in terms of, you know, the**  **3 compressors that we have today can deal with 4 a certain amount of flooding during harvest.**  **5 A 50 percent bigger evaporator may mean those 6 compressors are no longer reliable during a**  **7 harvest event. We won’t know until we do the 8 testing, right. There hasn’t been any**  **9 analysis done around that. 10 And then the other big thing that**  **11 happens is the mass of the evaporator grows 12 directly with its size. When you harvest an**  **13 ice machine, you have to heat that evaporator 14 up and cool it back down. 50 percent bigger**  **15 evaporator takes 50 percent more energy to 16 heat up and cool back down. Again, I don’t**  **17 believe that’s been considered in the model 18 that was used to predict the benefit of that**  **19 larger evaporator. 20 MR. BROOKMAN: George, it seems like**  **21 Craig has a follow-on comment. Craig? 22 MR. RANEY: Yes, Craig Raney with** 

### Page 144

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### Emerson Climate Technologies. I guess my **2** 

### question is a point of clarification. **3** 

### So in the modeling that you did, what **4** 

### rating point for the compressors did you use? **5** 

### MR. BURGOS: It’S the AHRI rating. **6** 

### MR. RANEY: So the 20-120 rating, **7** 

### right? **8** 

### MR. BURGOS: Yes. **9** 

### MR. RANEY: And that’s not typically **10** 

### where an ice machine operates and I think **11** 

### that’s, you know, Daryl’s point, just to **12** 

### follow-on to that. I think that’s part of the **13** 

### issue with the modeling. **14** 

### MR. BROOKMAN: Okay. **15** 

### MR. BURGOS: Well -- **16** 

### MR. ERBS: Well, yes, I don’t know if **17** 

### it will help you out, I’m sorry to jump in. **18** 

### Daryl -- **19** 

### MR. BROOKMAN: Daryl. **20** 

### MR. ERBS: We typically use like a **21** 

### 10-105 condition. Now, other manufacturers **22** 

### may use something slightly different, but

### Page 145

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### that’s kind of a midpoint. It’s interesting **2** 

### to note that in the cost curves that were **3** 

### established for compressors, a 15-95 **4** 

### condition was used and I’m curious, where did **5** 

### that come from because it really doesn’t match **6** 

### an operating condition that ever occurs in an **7** 

### operating ice machine? **8** 

### MR. BROOKMAN: Detlef. **9** 

### MR. WESTPHALEN: So what part of the **10** 

### TSD are you referring to there? **11** 

### MR. ERBS: I think it’s in Section 5. **12** 

### MR. BROOKMAN: Turn your mic on. **13** 

### MR. ERBS: Yes, it’s in Section 5. **14** 

### MR. BROOKMAN: Maybe we can just dig **15** 

### for that, yes, and figure out where that is. **16** 

### MR. PETRILLO-GROH: I think that’s **17** 

### Section 5.9.2. **18** 

### MR. ERBS: Yes. **19** 

### MR. BROOKMAN: Thank you, Laura. **20** 

### MR. BURGOS: I think one comment **21** 

### I’ll make in terms of that compressor is when **22** 

### we do a small one, we use the compressor maps.

### Page 146

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 So the performance of those compressors is 2 based off of whatever the map tells us the**  **3 performance is at, you know, at the 20 degree 4 evaporating, 10 degree evaporating, whichever**  **5 set that’s in. So hopefully I’ll help clarify 6 how that’s done.**  **7 Mr. Brookman: Daryl, follow-on. 8 MR. ERBS: So I understand and**  **9 probably wouldn’t be as concerned about the 10 20-120 as the fact that those compressor maps,**  **11 they can’t model what happens during the 12 harvest event. They also cannot analyze what**  **13 happens during the pre-chill time, before the 14 ice starts freezing.**  **15 The coefficient models that are 16 fitted are based on data that doesn’t include**  **17 those operating regions. 18 MR. BROOKMAN: Detlef?**  **19 MR. WESTPHALEN: Well, you know, in 20 response to Daryl, I understand this is a**  **21 complicated process and you know, I think 22 there are many things that require, you know,** 

### Page 147

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### looking at, you know, different conditions, **2** 

### the way different components behave in **3** 

### different ice makers. It might be different, **4** 

### you know. **5** 

### The analysis was conducted based on **6** 

### the available information. And, you know, **7** 

### best estimates based on the information that **8** 

### we had available to use and, you know, we **9** 

### welcome additional information to understand **10** 

### that. **11** 

### For instance, the issue of, you know **12** 

### the harvest cycle impacts on, you know, the **13** 

### performance. You know, the DOE conducted **14** 

### some testing to understand that. We tried to **15** 

### obtain some test data, you know, asking **16** 

### manufacturers for some of that. We got a **17** 

### little bit and, you know, we made some **18** 

### comparisons of that data with our modeling **19** 

### and, you know, it looked like it had reasonable **20** 

### agreement. **21** 

### But, you know, we understand that **22** 

### you’ve got years of experience doing this

### Page 148

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### stuff and certainly you know, it sounds like **2** 

### you know, with the recent Energy Star work, **3** 

### much more experience and, you know, certainly, **4** 

### you know we welcome that input. **5** 

### MR. BROOKMAN: Laura, George has **6** 

### been in the queue a long time. George? **7** 

### MR. PARSONS: George Parsons, **8** 

### Ice-O-Matic and I’ll go quickly. **9** 

### But I just want to concur with what **10** 

### everybody said here and independent of exactly **11** 

### what Daryl talked about. We did testing with **12** 

### a batch ice machine where we took one **13** 

### compressor out and put a higher EER compressor **14** 

### in that was, in our case, roughly ten percent **15** 

### and we only seen a two percent improvement; and **16** 

### it relates back to the harvest cycle. **17** 

### And you have to remember the unique **18** 

### circumstances. A commercial refrigeration **19** 

### freezer is going to defrost once, maybe twice **20** 

### a day. That’s all you’re going to see it. **21** 

### We’re seeing the equivalent of a **22** 

### defrost, at harvest, every 15 to 20 minutes

### Page 149

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### inside of a customer’s busy operation. And so **2** 

### it’s a completely different model that you’ve **3** 

### got to look at because the effect of harvest **4** 

### will remove a lot of the improvements that **5** 

### you’re seeing with compressor efficiency **6** 

### improvement. **7** 

### And I would state that this is one of **8** 

### the large areas of this document that we’re **9** 

### very concerned with became we believe that the **10** 

### improvement stated with compressors and **11** 

### compressor technology is just completely **12** 

### overstated. **13** 

### MR. BROOKMAN: Laura? **14** 

### MR. PETRILLO-GROH: So just to be **15** 

### brief, the ten percent improvement was **16** 

### determined for the CRE rulemaking, but that **17** 

### was just the preliminary analysis. The final **18** 

### rule, you know, included across an efficiency **19** 

### increase of two percent for a cost increase of **20** 

### five percent of the compressor. **21** 

### Further, these, you know, **22** 

### compressors operate very differently than

### Page 150

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### they do in commercial refrigeration **2** 

### equipment. **3** 

### What’s the procedure for updating, **4** 

### you know, the analysis to reflect the, you **5** 

### know, more appropriate costs and efficiency **6** 

### increases as well as, you know, take into **7** 

### account this different operating map. **8** 

### You know, is there information that **9** 

### AHRI can provide? I know we’re on a very tight **10** 

### deadline and I’d like to respect that and, you **11** 

### know, do what we can to help. So, you know, **12** 

### but I’m fairly new to this process in **13** 

### general. So could you guys go over maybe **14** 

### what would be involved in updating his **15** 

### analysis and is it possible at this point? **16** 

### MR. CYMBALSKY: This is John **17** 

### Cymbalsky, DOE. **18** 

### So yes, we’re taking public comments **19** 

### on what we did. The process is fairly **20** 

### standard. If you take issue with what we’ve **21** 

### done, you provide data standard. If you take **22** 

### issue with what we’ve done, you provide data

### Page 151

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 to support your position. 2 We weigh all the data and comments**  **3 that we get and based on that, we’ll move 4 forward with the final rule.**  **5 As for the rating, it sounds like 6 you’re asking about the test method. Maybe**  **7 you’re not, maybe I’m misunderstanding. But 8 the test procedure is what it is. That’s a**  **9 final test procedure. We will be constrained 10 to that. We’re not changing the test method**  **11 simultaneously with this rulemaking, 12 completely off the table. So let’s work**  **13 within what the test method tells us to do to 14 rate these ice makers.**  **15 And so if you can provide data that 16 suggests we need to adjust our analysis, we do**  **17 that based on verifiable data and not 18 assertions. Anyone can assert anything. We**  **19 get a lot of assertions but we need to back that 20 with data. So we --**  **21 MR. BROOKMAN: Stephen and then I’m 22 coming back to you, Louis.** 

### Page 152

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### MR. SCHAEFER: Yes, just quickly. **2** 

### I concur with George and Daryl on **3** 

### their analysis. We had similar analysis with **4** 

### about a 12 percent increase in EER, we only saw **5** 

### about three percent. So we’ll share our data **6** 

### on that. **7** 

### MR. BROOKMAN: That’s good, you **8** 

### heard John. They need to see the data. **9** 

### Robert, go ahead. **10** 

### MR. WILKINS: So, I think this -- **11** 

### John’s made some very good points here. But **12** 

### most of my career has been with compressor **13** 

### manufacturing, 38 years. **14** 

### I would say that ice machines differ **15** 

### significantly from air conditioning and **16** 

### commercial refrigeration in that it’s almost **17** 

### like there’s a lot of art in air conditioning **18** 

### and a lot of experience required. You can’t **19** 

### put everything in a curve in a simulation and **20** 

### make it work. **21** 

### To illustrate the point a little bit, **22** 

### I think it’s fair to say when you’re making

### Page 153

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### ice, you want the most efficient compressor **2** 

### you can get. But when you’re harvesting ice, **3** 

### it would help to have the least efficient **4** 

### compressor you can get because you want the **5** 

### heat. You want that waste heat to harvest it. **6** 

### MR. BROOKMAN: Louis? **7** 

### MR. WILKINS: So I’m just using that **8** 

### to illustrate the complexity here, that it’s **9** 

### not just looking at an operating map set of **10** 

### curves on a compressor and trying to figure out **11** 

### a point and then make an assumption. It won’t **12** 

### work because you’ve got such diverse operating **13** 

### conditions during the production, the **14** 

### pre-production, the production and the **15** 

### harvesting of the ice. **16** 

### MR. BROOKMAN: Louis. **17** 

### MR. STARR: So I’ll start with, it **18** 

### seems like a common theme I’m hearing is that **19** 

### the ice machines, they have more defrost **20** 

### cycles which kind of implies that they may be **21** 

### harvesting more which also is also reflected **22** 

### in more operating hours than probably what’s

### Page 154

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### shown typically. **2** 

### So I think there’s -- while there may **3** 

### be some losses in efficiency, if they’re **4** 

### operating more, they’re operating more hours, **5** 

### there’s an opportunity to gain some of that **6** 

### energy back, too. **7** 

### So that’s -- it kind of goes back **8** 

### though to a little bit, but John was talking **9** 

### about -- John Cymbalsky was talking about in **10** 

### the test procedure. But I think it would be **11** 

### kind of good to understand if that’s a **12** 

### realistic reflection of what it is, we should **13** 

### be trying to reflect that in the test procedure **14** 

### rather than trying to redefine that in the **15** 

### NOPR. **16** 

### Mr. Brookman: Okay. Final comment **17** 

### from Daryl and then we’re moving on. **18** 

### MR. ERBS: So just -- so Daryl Erbs, **19** 

### Manitowoc Ice. **20** 

### There’s nothing wrong with the test **21** 

### procedure, in my opinion. I think the test **22** 

### procedure provides an accurate measurement of

### Page 155

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### the integrated performance of a batch ice **2** 

### machine. So we’re good with that. **3** 

### I think what we’re really -- and you **4** 

### know, Detlef and I have, you know, we’ve tried **5** 

### to explore the model that was used. It’s a -- **6** 

### I think it’s almost an impossible task so I’m **7** 

### really kind of sympathizing with, you know, **8** 

### what they were asked to do. I think they did **9** 

### the best they could. **10** 

### I don’t think it’s something that can **11** 

### be handled completely by modeling, that there **12** 

### needs to be experimental data to perhaps bring **13** 

### in some de-rating factors is typically what we **14** 

### would do in a model, if we understood that, you **15** 

### know, the model wasn’t correctly handling all **16** 

### of the physics that were going on. **17** 

### We’re not saying that there’s no way **18** 

### to come up with the right optimum for these **19** 

### proposed energy efficiency standards, but **20** 

### right now, our concern is the model would lead **21** 

### to not the optimum but something that in fact **22** 

### drives a lot more cost into the ice machine

### Page 156

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### because the expected gains from some of these **2** 

### technologies are not going to be realized at **3** 

### the levels that the model predicts. **4** 

### Once this goes into law, we’re stuck **5** 

### with it. We have to make those efficiency **6** 

### levels. We’ll end up putting a lot more money **7** 

### into the ice machine to get there. There will **8** 

### be utility, you know, end-use impacts and what **9** 

### I’m hoping is that we can work together to help **10** 

### make the model a more accurate reflection of **11** 

### what really happens and find the levels that **12** 

### really do make sense for the industry. **13** 

### MR. BROOKMAN: Okay, so now we’re **14** 

### moving on. **15** 

### MR. CYMBALSKY: I have a question, **16** 

### I’m sorry. **17** 

### MR. BROOKMAN: John Cymbalsky. **18** 

### MR. CYMBALSKY: Okay, so hopefully **19** 

### I’m right about this, but this is what I’ve **20** 

### been told, that our TSL-1 roughly reflects **21** 

### Energy Star, ten percent over the existing **22** 

### baseline. Is that about right? Okay, good.

### Page 157

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### So based on that, I think through the **2** 

### slide I’m looking at, I have the mapping in **3** 

### terms of what we assumed on how you get that **4** 

### extra ten percent. **5** 

### But my question to the **6** 

### manufacturers, and if you can’t answer this **7** 

### question, it’s fine, I understand. But many **8** 

### of you play in the Energy Star space, can you **9** 

### describe generally what you do in terms of **10** 

### efficiency upgrades to meet that ten percent? **11** 

### Is it the compressor or is it a combination of **12** 

### lots of things or what? What’s -- if you can’t **13** 

### answer that, that’s fine, but if you can, I’d **14** 

### appreciate just knowing what the -- **15** 

### MR. BROOKMAN: Daryl, start. **16** 

### MR. ERBS: So Daryl Erbs, Manitowoc **17** 

### Ice. **18** 

### We put more efficient compressor in. **19** 

### Our suppliers have been kind of slow, you know, **20** 

### as Robert mentioned. So we, you know, we -- **21** 

### but we do that when we can. We put larger **22** 

### evaporators in, you know, where we can. You

### Page 158

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 know, we can’t always do that because of some 2 of the things I’ve mentioned. We put both**  **3 larger and more efficient condenser surfaces 4 in. And then there’s just a lot of system**  **5 level optimizing. 6 But we’re already taking advantage**  **7 of everything but permanent magnet brushless 8 DC motors for fans and that’s largely because**  **9 of, one, they’re very, very expensive. 10 They’re much more expensive than what’s**  **11 assumed in the NOPR, and we’ll share data on 12 that. And they’re not tested. Although**  **13 they’re used in commercial refrigeration, we 14 don’t use exactly the same frame**  **15 configuration. And I think someone mentioned 16 earlier today, reliability is the number one**  **17 customer requirement. So we just have to go 18 through that process.**  **19 But when we’ve looked at them at the 20 current pricing -- and we’ve just received new**  **21 quotations -- they’re still not very 22 cost-effective individual components when you** 

### Page 159

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### look at, you know, how do you get another three **2** 

### or four percent out of the ice machine? **3** 

### They’re still a relatively unattractive **4** 

### option from a cost standpoint. **5** 

### We’ve been able to get the Energy **6** 

### Star with compressor and surface area and some **7** 

### other things. If we have to go beyond that, **8** 

### we’re going to be driven to brushless DC fan **9** 

### motors. We’ll probably be driven to **10** 

### brushless DC compressors which, you know, they **11** 

### could be produced but at the cost that I think **12** 

### they’re going to be offered to us, again, it’s **13** 

### well beyond what’s assumed in the current **14** 

### NOPR. **15** 

### MR. BROOKMAN: Stephen, do you want **16** 

### to add in here? **17** 

### MR. SCHAEFER: Yes, I think, **18** 

### concurring with Daryl on that, go through **19** 

### depth or size. You look at compressor and **20** 

### condenser marriage. You look at the water **21** 

### valve output. So you’re looking at a lot of **22** 

### different parts where the engineers are trying

### Page 160

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 to see, okay, if I increase the production, how 2 much increase in electrical usage or what can**  **3 I do? 4 So it’s a lot of trial and error in**  **5 seeing what we can do, and there’s not just one 6 typical answer because there’s so many**  **7 different sizes. So we can work with you to 8 show you some of the data that we have through**  **9 it, but it’s a long, drawn-out process and we 10 try to make it as efficient as we can in every**  **11 aspect and keep the reliability so that 12 they’re not going to be mad at us in three years**  **13 if something’s wrong with the machine. 14 MR. BROOKMAN: Okay. George?**  **15 MR. PARSONS: George Parsons, 16 Ice-O-Matic.**  **17 The only thing I would add to that in 18 terms of looking at that specifically when you**  **19 talk about a batch ice maker is exactly what 20 was talked about earlier. During the normal**  **21 refrigeration cycle, when we’re freezing the 22 ice, we want the compressors as efficient as** 

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**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### possible. When you go into harvest, then you **2** 

### need it -- you’re into a period where it’s not **3** 

### as efficient as you want it to be. **4** 

### So when you’re looking at Energy Star **5** 

### models, you spend a lot of time in the details **6** 

### of that logic of exactly how you go into **7** 

### harvest. You come out of harvest, the **8** 

### controls around that, so that you spend -- you **9** 

### optimize that energy consumption there. **10** 

### We can spend a lot of test time **11** 

### looking at the very details of how that’s **12** 

### happening to gain -- to get what we can out of **13** 

### that compressor increase and get to those **14** 

### Energy Star levels. **15** 

### MR. BROOKMAN: Now we’re moving on. **16** 

### MR. BURGOS: All right, with that **17** 

### I’ll just conclude it. Of course, DOE will **18** 

### request comment and data on the efficiency **19** 

### gains. **20** 

### We have one more section to the **21** 

### engineering analysis. One is the Efficiency **22** 

### Levels for Batch Machines. This should look

### Page 162

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 pretty familiar because it’s pretty similar to 2 what was presented in the preliminary**  **3 analysis. 4 The numbers have been updated to**  **5 reflect new cost efficiency curves and also 6 note the new IMH-A extended batch class, which**  **7 is pretty much the IMH-A to large. . . 8 Yes?**  **9 MR. BROOKMAN: Daryl? 10 MR. ERBS: I’m probably going to get**  **11 in trouble, but can we just move back because 12 there was -- you requested comment on utility**  **13 impact. 14 MR. BURGOS: Yes.**  **15 MR. BROOKMAN: At least comment on 16 --**  **17 MR. ERBS: And the one that I’m most 18 concerned about, again, is it’s not the**  **19 largest class but it’s still a very important 20 one, is there’s a 22 inch wide air-cooled ice**  **21 making head that’s on the market. 22 It’s growing in importance because** 

### Page 163

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 one of the trend that’s happening in our world 2 of restaurants is what we’re calling tiny**  **3 kitchens. People are downsizing their 4 kitchen size because they’re moving back into**  **5 urban areas and we think that’s really 6 exciting that people are opening up**  **7 restaurants but, you know, they have to fit 8 into smaller spaces.**  **9 There are ice beverage dispensers 10 that are designed for a 22 inch wide machine.**  **11 They’re very tall. That’s how they get their 12 ice beverage dispenser down to 22 inches. The**  **13 ice machine that goes on top of it ends up 14 already being very tall because that’s how we**  **15 can get 500 pounds or more of ice out of that. 16 The ceiling prohibits that**  **17 particular style of ice machine from growing 18 any taller. The analysis that was done**  **19 around, you know, a small class of air cooled 20 ice-making head -- and I understand the**  **21 reasons why DOE said we don’t want to have 22 different efficiency standards for different** 

### Page 164

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### cabinet sizes, but the end result is to meet **2** 

### the proposed efficiency level for, let’s say **3** 

### a 400 pound air cooled ice-making head. **4** 

### You could do it in a 30 inch by **5** 

### growing the height. You could not do it in a **6** 

### 22 inch because it can’t get any taller, both **7** 

### for, you know, functionality as well as just **8** 

### physical building space reasons. **9** 

### I’m pretty convinced, with the **10** 

### proposed levels, that that category could go **11** 

### away. **12** 

### MR. BROOKMAN: Okay, thank you. **13** 

### Scott? **14** 

### MR. BINGHAM: Scott Bingham with **15** 

### Follett. **16** 

### I had mentioned earlier, we have a **17** 

### proprietary technology that sends ice through **18** 

### a tube and so we put ice machines in places **19** 

### where nobody else puts them and we have ice **20** 

### machines that aren’t a standard 22 or aren’t **21** 

### a standard 30 inch machine and we’ve proved **22** 

### that there’s a market and a reason for machines

### Page 165

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### to be less than 22 inches, or less than 30 and **2** 

### in odd increments. **3** 

### And we’ve done design changes to **4** 

### reduce the height of a machine by one inch just **5** 

### so we could put it in more places. So it’s -- **6** 

### there’s additional reasons for chassis sizes. **7** 

### MR. BROOKMAN: Okay. Okay. **8** 

### MR. BURGOS: All right, thank you. **9** 

### So these are the efficiency levels **10** 

### for the batch machines and these are the **11** 

### efficiency levels for the continuous **12** 

### machines. **13** 

### We analyzed three different **14** 

### equipment classes for the continuous, nine in **15** 

### the batch category. **16** 

### If you’ll notice, the RCUs, for RCUs **17** 

### we had not considered those separately, the **18** 

### same as was proposed in the preliminary **19** 

### analysis. Those are subject to the .2 **20** 

### kilowatt hour per 100 pounds adjustment. **21** 

### Mr. Brookman: Yes, please. Your **22** 

### name.

### Page 166

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### MR. DESHETLER: Scott DeShetler, **2** 

### Ice-O-Matic. **3** 

### Are these numbers taken from the AHRI **4** 

### database exclusively, or do they take into **5** 

### account offshore manufacturers that are **6** 

### coming in from other countries or what is the **7** 

### population that’s summarized here? **8** 

### MR. BURGOS: So I guess, for the **9** 

### efficiency levels, so the EL 2, EL 3, EL 4, EL **10** 

### 5, EL 6, those are based off the cost **11** 

### efficiency curve and so the max tech as well. **12** 

### Maybe you’re asking about the max **13** 

### available category? **14** 

### MR. DESHETLER: I’m asking what the **15** 

### available population was that you used to **16** 

### obtain these numbers? **17** 

### MR. CYMBALSKY: It’S the entire **18** 

### market of what’s available, not just domestic. **19** 

### They could be foreign. **20** 

### MR. DESHETLER: So it’s -- you **21** 

### tested or you brought in numbers from all over **22** 

### the place, then.

### Page 167

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### MR. CYMBALSKY: Right, our cost **2** 

### efficient -- so what’s described here is what **3** 

### came out of the cost efficiency curves that **4** 

### we’ve been discussing over the past hour or so. **5** 

### MR. BURGOS: Yes. **6** 

### MR. BROOKMAN: Robert? **7** 

### MR. WILKINS: Just a clarifying **8** 

### question here a little bit and maybe gets to **9** 

### some of these other points. **10** 

### To help me understand this chart, the **11** 

### EL-4 and you’ve got the first one there, the **12** 

### IMH-W-Small-B. Does this mean that you are **13** 

### projecting, at that level, a possibility of **14** 

### increasing the efficiency by 20 percent? **15** 

### MR. BURGOS: Yes. **16** 

### MR. WILKINS: So that’s the **17** 

### efficiency improvement that could be achieved **18** 

### at an EL-4 cost increase? **19** 

### MR. CYMBALSKY: Right, EL-4 is **20** 

### several different things. It’s defined, what **21** 

### the improvements that go into what EL-4 is. **22** 

### MR. BURGOS: Right and what may well

### Page 168

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### help is if we jump ahead a bit. We have the **2** 

### full-cost efficiency curves and this pairs the **3** 

### efficiency levels with the costs that were **4** 

### used. These are MPCs and as you’ll see for **5** 

### each one of the equipment classes, there’s a **6** 

### cost associated with reaching a certain EL **7** 

### level along with the max tech at the end. **8** 

### MR. CYMBALSKY: And these are **9** 

### manufacturing costs, not consumer costs? Is **10** 

### that correct? **11** 

### MR. BURGOS: Yes. These are MPCs. **12** 

### MR. BROOKMAN: Thank you, John. **13** 

### Now Scott. **14** 

### MR. BINGHAM: Just really quick. **15** 

### Going back to the slide on continuous type ice **16** 

### makers, where the remotes were not analyzed. **17** 

### I don’t remember the woman’s name with AHRI but **18** 

### she had mentioned that 95 percent of the **19** 

### business is represented by AHRI companies and **20** 

### I had mentioned also that we’re not in AHRI, **21** 

### so it doesn’t take a lot of math to figure out **22** 

### the market space that a small company like mine

### Page 169

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 has. 2 Also, when we only make continuous**  **3 type ice makers, which are approximately 15 4 percent of the market, we’re only playing in**  **5 this one space and so this RCU section 6 represents a significant portion of why I’m in**  **7 business. 8 And so, if these models that we’re**  **9 talking about are not right, one line here 10 could mean the viability of a company up in**  **11 Pennsylvania. 12 MR. BROOKMAN: Okay. Yes, please.**  **13 Chris? 14 MR. SALATINO: Chris Salatino,**  **15 Scotsman Ice. 16 John, you had mentioned a couple of**  **17 minutes ago about, you know, where if we 18 thought some of the assumptions and test data**  **19 didn’t support our experience to provide data. 20 Forgive me for being new to the process, but**  **21 as far as the data that you’re looking for, is 22 that, you know, test data that we’ve tested** 

### Page 170

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 recorded or does that come from -- are your 2 requirements independent third-party? What**  **3 are your expectations for data from us? 4 MR. CYMBALSKY: John Cymbalsky,**  **5 DOE. 6 So we’ll take any data, so that’s the**  **7 first rule we have. Any data is better than 8 no data.**  **9 But having said that, and you can 10 sign an NDA with Navigant if you feel you need**  **11 to do that, like you don’t want to make the data 12 public, we can still use it in our analysis and**  **13 protect the identity of who provided that 14 data.**  **15 But the test results in particular 16 would be very important. If you have a test**  **17 report that’s very detailed about how you 18 calculated the values, what set points you**  **19 used, you know. 20 If you use the DOE test method**  **21 perfectly in a controlled environment like, 22 you know, we like to see, it doesn’t** 

### Page 171

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### necessarily have to be from a third-party lab. **2** 

### You guys obviously self-test all the time and **3** 

### self-certify. And we’re good with that. **4** 

### So we’ll take it any way you have it. **5** 

### MR. BROOKMAN: Okay. So this is a **6** 

### rather complicated chart. Comments on -- I **7** 

### think we’re now on 44. **8** 

### MR. BURGOS: Yes, we have 44 and then **9** 

### the slide after that is 45. **10** 

### MR. BROOKMAN: Batch and then **11** 

### continuous. Comments on these two charts? **12** 

### Yes, Daryl. **13** 

### MR. ERBS: Daryl Erbs, Manitowoc **14** 

### Ice. I think I have to start with a question **15** 

### because these -- this chart shows EL, right, **16** 

### 2 through 6 and TSD as TSLs 1 through 5 and -- **17** 

### but really when I look at it, I’m just looking **18** 

### at, okay the recommended, so like if I take my **19** 

### favorite case because it’s actually the **20** 

### highest volume category in the industry, **21** 

### right. So the ice-making head, small, **22** 

### air-cooled B and I think the target is to get

### Page 172

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 to 25 percent higher efficiency on that. 2 And when I looked at Table 5.10.6 in**  **3 the TSD, I can see how you get to 24.88 percent. 4 So that’s kind of what -- and this is very**  **5 helpful, by the way. I really, really 6 appreciate the fact that you’ve shared a**  **7 little more detail in terms of the cost model. 8 MR. BURGOS: Right, for anyone who’s**  **9 not following along in the TSD, we have 10 descriptions of this process by design**  **11 options, so showing for a certain compressor 12 growth. We have an associated energy savings**  **13 and associated energy costs, and that curve is 14 then used to derive efficiency that’s some of**  **15 these specific points. 16 MR. ERBS: And that really helps a**  **17 manufacturer get down to the cost assumptions 18 for each technical element because it’s really**  **19 hard to look at it in an aggregate. But when 20 I looked at that table, I went back because we**  **21 have data around cost elements and one of the 22 ones in here was a 50 percent larger** 

### Page 173

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### evaporator. So you grow it taller, you put **2** 

### the extra surface area in and it’s -- I think **3** 

### that larger evaporator cost is $48.48 in the **4** 

### TSD. That’s the manufacturer cost impact **5** 

### just for that elements. **6** 

### For us as a manufacturer, it’s more **7** 

### than double that. I think part of that may **8** 

### have to do with there’s the evaporator and then **9** 

### there’s the cabinet. It’s made out of **10** 

### stainless. It’s relatively high cost **11** 

### material. We put a lot plastic parts into the **12** 

### food zone to make it cleanable to comply with **13** 

### NSF standards. **14** 

### Those plastic parts may shock you in **15** 

### terms of what they actually cost us. Again, **16** 

### you have to remember our highest volume **17** 

### models, we might make 4,000 or 5,000 pieces a **18** 

### year of that particular cabinet size and so we **19** 

### don’t get the same purchasing power that, **20** 

### let’s say if you went out in the appliance **21** 

### industry and looked at what do they pay for a **22** 

### plastic part, we pay a lot more.

### Page 174

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 And so just looking at a few 2 examples, I think -- and again, we’ll share**  **3 more specifics. I don’t believe that that -- 4 particularly in the case where cabinets get**  **5 larger, that these costs models are accurate 6 in terms of what our true costs are.**  **7 MR. BROOKMAN: Okay. Chris? 8 MR. SALATINO: And then just to**  **9 parallel onto the earlier comments. 10 So as far as the test data, we know,**  **11 you know, you’d pretty much accept something 12 from an accredited lab or an accredited -- but**  **13 then as far as to parallel Daryl’s comments on 14 the cost assumptions, what would be valuable**  **15 information and in what format would it be 16 meaningful to continue this discussion?**  **17 MR. CYMBALSKY: So -- John 18 Cymbalsky, DOE -- so I know Navigant when they**  **19 do their interviews with you all, they do a 20 detailed cost modeling. You know, we’ve torn**  **21 these down and we’ve costed out component by 22 component and then we build it back up with** 

### Page 175

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### the, you know. **2** 

### You mentioned some very good points **3** 

### about all that factors in. How much can you **4** 

### get these little plastic parts for? **5** 

### And so we have the assumptions we **6** 

### make about that. They can talk to you again **7** 

### under the NDA about how these numbers looked. **8** 

### MR. BROOKMAN: Okay, Robert? **9** 

### MR. WILKINS: Robert Wilkins, **10** 

### Danfoss. **11** 

### One of the things I’ve always been **12** 

### intrigued about the ice maker industry, as **13** 

### I’ve shared with you, it’s a lot of science and **14** 

### a lot of art, but it’s striking to me how low **15** 

### the volume in the industry is and I’m just -- **16** 

### I’m referring to your data on a subsequent **17** 

### page. **18** 

### The industry -- the total industry is **19** 

### somewhere around 150,000 units a year. **20** 

### That’s about 2.5 percent of the air **21** 

### conditioning industry. It’s a tiny sliver. **22** 

### And so the scale available to get the cost down

### Page 176

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### on these highly specialized parts, the scale’s **2** 

### not there. **3** 

### The ability of these manufacturers **4** 

### amazes me to be able to adapt these units with **5** 

### such very small scale. The industry’s **6** 

### 150,000 units and we have three or four **7** 

### manufacturers sitting around the table here so **8** 

### you can just get a feel for -- this is very low **9** 

### volume application here. And if you need a **10** 

### very specialized stainless steel part or **11** 

### special NSF-proof plastic part or compressor, **12** 

### how are you going to persuade those **13** 

### manufacturers to produce those very **14** 

### specialized parts in extremely low volume? **15** 

### The leverage isn’t here that you have **16** 

### in the appliance industry and that you have in **17** 

### the unitary industry. **18** 

### MR. BROOKMAN: Okay. **19** 

### MR. BURGOS: And that’s the end of **20** 

### the engineering presentation, but B **21** 

### Sure. **22** 

### MR. BROOKMAN: Let’s start on

### Page 177

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 markups. 2 MR. BURGOS: Laura has one.**  **3 MR. BROOKMAN: Ready to go to lunch? 4 (Laughter.)**  **5 MR. BROOKMAN: We’re falling a 6 little bit behind here but I’ve been but I’ve**  **7 been encouraged to let us take lunch. 8 Yes, Doug, please.**  **9 MR. RAWALD: So, Daryl, you 10 specifically mentioned a couple of times the**  **11 niche kind of 22 inch wide model, and what I 12 want to assure people is the Department has a**  **13 mechanism through which, in developing 14 standards, there comes a particular model that**  **15 still wants to be in play that needs to be 16 exempt from the standard where folks can apply**  **17 for an exemption from the standard through the 18 Office of Hearing and Appeals.**  **19 So there is a way of keeping those 20 product lines alive if they are unable to meet**  **21 the standards. So that is something that 22 let’s keep in mind as we’re progressing on** 

### Page 178

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 this. 2 MR. BROOKMAN: So, I will yield.**  **3 Let’s take lunch. It’s ten after 12:00, which 4 means we’ll resume at ten after 1:00 in this**  **5 very same room. This room will be supervised. 6 You can leave your stuff here and please**  **7 remember to wear your badge as you’re walking 8 around. You may need -- if you go to the big**  **9 cafeteria down on the ground floor about 100 10 yards in that direction, you might need an ID**  **11 to get back through the security portal. 12 Okay?**  **13 So we’ll see you back here at ten 14 after 1:00.**  **15 We’ve covered a lot of ground 16 already. We’ll cover more after lunch.**  **17 (Whereupon the foregoing matter went 18 off the record at 12:13 p.m.)**  **19 20**  **21 22** 

### Page 179

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 2**  **3**

### Page 180

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 A-F-T-E-R-N-O-O-N S-E-S-S-I-O-N 2 1:17 p.m.**  **3 MR. BROOKMAN: We're going to start 4 up with markups in energy use analysis, and we**  **5 are going to hear from Alan. 6 MS. PETRILLO-GROH: Excuse me,**  **7 Doug. Doug? 8 MR. BROOKMAN: Yes?**  **9 MS. PETRILLO-GROH: I actually have 10 one question about the engineering analysis**  **11 before we go -- 12 MR. BROOKMAN: Before we move on,**  **13 yes, please, Laura. 14 MS. PETRILLO-GROH: Okay. So,**  **15 forgive me if I'm just -- Laura Petrillo, 16 AHRI -- just forgive me if I'm new and don't**  **17 understand quite what, from slide 42 -- 18 MR. BROOKMAN: Yes.**  **19 MS. PETRILLO-GROH: -- what the max 20 available levels are in relation to the**  **21 efficiency levels and equipment, and how they 22 relate to the TSL levels that are set or** 

### Page 181

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### proposed in the NOPR. **2** 

### Just looking at the first one, the **3** 

### IMHWb -- **4** 

### MR. BROOKMAN: Uh-hum. **5** 

### MS. PETRILLO-GROH: -- the max **6** 

### available is 22 percent, but for TSL3 in the **7** 

### NOPR it's asking for, you know, it's proposed **8** 

### at EL5 level, which is 25 percent and above the **9** 

### max available level. Is that typical or what **10** 

### are considerations that are given for that **11** 

### sort of situation? **12** 

### MR. CYMBALSKY: John Cymbalsky. **13** 

### So, max tech and max available might **14** 

### be two different things here, right? So, it's **15** 

### the market, what's on the market versus what's **16** 

### technically feasible. **17** 

### So, we could propose a technology **18** 

### that we know can be designed to work, but is **19** 

### it necessarily on the market for purchase? **20** 

### MR. BROOKMAN: So, available is on **21** 

### the market. **22** 

### MS. PETRILLO-GROH: But available

### Page 182

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 is on the market, but is this not considering 2 units with proprietary technology or two**  **3 configurations? So, above 22 percent, 4 between 22 and 25 percent, you are really only**  **5 able to get to that level using proprietary 6 technology or two ice configurations. Is it**  **7 acceptable to sort of -- 8 MR. CYMBALSKY: We haven't chosen a**  **9 level that is a proprietary technology, but 10 that doesn't mean you can't show it as an EL.**  **11 It's just that you don't pick it because we 12 don't do that.**  **13 MS. PETRILLO-GROH: So, should we 14 make all these part of our written comments?**  **15 Is it discrepancy between what the level of 16 proposed is? Because I think it was proposed**  **17 as TSL3. 18 MR. CYMBALSKY: It's not, the**  **19 proprietary technology is not proposed here, 20 as far as I can tell. So, I'm not sure what**  **21 your question is. You can comment on whatever 22 you would like is my answer, but we haven't** 

### Page 183

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 picked an EL that's either proprietary or not 2 available on the market here.**  **3 MR. WILKINS: John, Robert Wilkins 4 here.**  **5 It may just be a misunderstanding of 6 what the definition of max tech and max**  **7 available is. My interpretation, max 8 available is available on the market today.**  **9 MR. CYMBALSKY: Right. 10 MR. WILKINS: You can go out and**  **11 procure one. It is not dependent on any 12 further work on the DOE.**  **13 The max tech -- correct me, guys, if 14 I'm wrong -- max tech does require**  **15 development, and it's their view of what could 16 be achievable with the technologies that they**  **17 have evaluated. Is that fair enough? 18 MR. CYMBALSKY: And max available**  **19 might be a proprietary technology as well. 20 There is nothing precluding someone on the**  **21 market selling something that only they have 22 in their unit.** 

### Page 184

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 DR. AMRANE: I think they're asking, 2 if the proposed rule is 25 percent, what's**  **3 going on between the two? 4 MR. BROOKMAN: John Cymbalsky is**  **5 next. 6 MR. DELASKI: Yes, so for that**  **7 particular one, 25 percent is what we chose. 8 MR. BROOKMAN: Frank, do you want**  **9 to -- 10 MR. MOORE: You put a question in my**  **11 mind, and it is interesting. So, if the 12 proposal is 25 percent, what's going on**  **13 between the 22 and 29 percent? Is that what 14 you're asking?**  **15 MS. PETRILLO-GROH: Or above the 22 16 and the 25 percent, if the 25 percent above**  **17 baseline is what's proposed, and the max 18 available on the market now is 22 percent**  **19 before you get into proprietary technologies? 20 MR. MOORE: It's those three points**  **21 is what is going to be developed between now 22 and '17. Is that the conclusion?** 

### Page 185

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 MR. COOKE: If I can jump in 2 here -- I'll steal a little bit of Javier's**  **3 thunder -- I think in a lot of cases what you 4 will see is that there is something like a**  **5 drain water heat exchanger or a motor that's 6 not currently on the market in a machine that**  **7 is for sale. 8 So, if you take a machine that might**  **9 otherwise be the max available and you add 10 something onto it, you get to a higher number,**  **11 which would be the max tech. 12 MR. BURGOS: And that can also**  **13 include things like higher efficiency 14 compressors, if there's any on the market.**  **15 MR. BROOKMAN: So, as it is shown in 16 this table, we know max available is at 22**  **17 percent. So, in some span of years, with new 18 component technologies, then DOE is**  **19 suggesting you can get to 25 percent. 20 Karim?**  **21 DR. AMRANE: Karim. I'm with AHRI. 22 So, is DOE saying that you could** 

### Page 186

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 establish a minimum energy conservation 2 standard with using proprietary technology?**  **3 Is it what DOE is saying? 4 MR. CYMBALSKY: We didn't say that,**  **5 no. 6 DR. AMRANE: No? Okay.**  **7 MR. BROOKMAN: John Cymbalsky says 8 no.**  **9 MR. CYMBALSKY: I said I didn't say 10 that.**  **11 (Laughter.) 12 MR. BROOKMAN: John Cymbalsky says**  **13 he didn't say that. Sorry. 14 (Laughter.)**  **15 MR. CYMBALSKY: I mean, just for 16 historical context, in the small motors rule,**  **17 we set a standard for something that fell into 18 that category where it was available to make**  **19 the motor more efficient than what was 20 currently on the market.**  **21 And so, we modeled the situation 22 where we did that. We were sued, and the rule** 

### Page 187

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### was upheld in the court. **2** 

### MR. BROOKMAN: Laura? **3** 

### MS. PETRILLO-GROH: I can't **4** 

### remember from earlier discussions, is this one **5** 

### of the categories where a larger machine was **6** 

### used for testing, and the analysis was **7** 

### extended to a smaller product category? **8** 

### MR. BROOKMAN: Javier? Do you want **9** 

### to just sit here for a second? **10** 

### MR. BURGOS: Sure. No, in the case **11** 

### of all these efficiency levels, if you scroll, **12** 

### I guess, down a couple of slides, I mean, these **13** 

### are all ones that were directly analyzed. **14** 

### MS. PETRILLO-GROH: Thank you. **15** 

### MR. BROOKMAN: Thank you, Frank. **16** 

### MR. MOORE: John, could you provide **17** 

### us with that case, just to complete the record? **18** 

### You mentioned that -- yes, if you could, yes, **19** 

### somehow or another, get that to folks that **20** 

### might have an interest in that. **21** 

### MR. BROOKMAN: Okay. Okay. Now **22** 

### we're moving on to Alan. Thank you.

### Page 188

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 MR. COOKE: And I don't seem to have 2 any control over --**  **3 MR. BROOKMAN: John's got that. 4 MR. COOKE: Oh, okay.**  **5 So, my name is Alan Cooke. I'm here 6 to talk about some of the economic analyses to**  **7 follow, starting with the markups for 8 equipment.**  **9 This is where we take the 10 manufacturer's selling price and adjust it for**  **11 what the retailer or what the public would see 12 if they bought it retail, which means we add**  **13 on some wholesale and distribution system 14 costs and some costs for the folks that are**  **15 closest to the customer who do the 16 installation work.**  **17 We use two different markups. The 18 first one is the baseline markup, and that**  **19 essentially recovers all of the overhead costs 20 that we have identified for this process. So,**  **21 I'll show you numbers in just a minute. 22 We use another markup which is an** 

### Page 189

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### incremental markup. And then, the notion **2** 

### here is that we're trying to capture costs that **3** 

### would change. If you add a few dollars to the **4** 

### cost of an ice maker, the cost will go up and **5** 

### it will be marked up a little bit at the retail **6** 

### level. But what really changes? The **7** 

### warehouse and a number of other things are **8** 

### still the same. So, it's really just a profit **9** 

### margin, some insurance costs, and other things **10** 

### that would change with the value of that ice **11** 

### maker. **12** 

### So, here are the costs that we added **13** 

### for the distribution chain. You will see we **14** 

### do not have what we call a national account, **15** 

### which would be a manufacturer directly to the **16** 

### customer. At the preliminary analysis **17** 

### meeting we were told by the manufacturers **18** 

### that, whereas there might be sales that go **19** 

### directly from the manufacturer to the **20** 

### customer, that distribution chain looks a lot **21** 

### more like a chain that has two steps because **22** 

### somebody closer to the customer will actually

### Page 190

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### be involved. **2** 

### MR. BROOKMAN: Daryl? **3** 

### MR. ERBS: I'm sure this comes up at **4** 

### every rulemaking, but has anyone ever **5** 

### validated this concept of a much smaller **6** 

### markup for the incremental? Has that **7** 

### actually ever worked in the marketplace? **8** 

### MR. COOKE: This model has been used **9** 

### for all of the rulemakings that I have seen. **10** 

### I remember your comment, which was at the **11** 

### preliminary analysis, which is if I add $20 to **12** 

### the actual physical cost of something, I will **13** 

### mark that up at the same rate that I would mark **14** 

### everything else up. **15** 

### I was just going to add, I think that **16** 

### that is a real short-term thing. You're in a **17** 

### very competitive market. You might do that **18** 

### until the next time you recalculate your **19** 

### overheads. And then, that markup rate might **20** 

### actually go down a little bit because your **21** 

### product values were higher overall. **22** 

### So, I think, in the end, we are still

### Page 191

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### looking at collecting costs that are **2** 

### incremental. And if you don't have an **3** 

### incremental overhead cost associated with **4** 

### that, I think it comes out in the wash in the **5** 

### end. **6** 

### MR. ERBS: I'm sorry, Daryl Erbs. **7** 

### For the most part, we are talking **8** 

### about material cost additions to the product. **9** 

### Is that included in the incremental? So, if **10** 

### I have to put a larger evaporator in, is that **11** 

### incremental, the difference between the **12** 

### evaporator cost I had before and what I have **13** 

### now? **14** 

### MR. COOKE: I do want to make one **15** 

### distinction here, just to make sure that it's **16** 

### clear. And that is that, at the manufacturer **17** 

### level, at your level, Daryl, when you add $20 **18** 

### to the cost of an ice maker, it is being marked **19** 

### up 25 percent, which is the exact same markup **20** 

### that was applied to all of the rest of the **21** 

### machine. That is at the manufacturer level. **22** 

### This is at the wholesale/retail/distribution

### Page 192

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 level. 2 MR. BARRINGTON: Yes, this is Ben**  **3 Barrington from Navigant. 4 Just so we're clear, we will talk**  **5 about the changes to manufacturer markups in 6 the manufacturer impact analysis section,**  **7 which follows this. 8 MR. ERBS: Yes, but just from our**  **9 business model standpoint, I mean, maybe we 10 just have to rethink our whole business model.**  **11 But if we change our list prices, we just 12 change our list price, and our channel**  **13 partners are going to follow the same rules 14 they always have in terms of what they, then,**  **15 add as a markup for their step in the channel 16 line. I mean, that's how they do it when we**  **17 raise prices today. And I'm not sure that 18 they would suddenly adopt a different**  **19 approach. 20 So, that's why I was asking, has it**  **21 ever been validated out in the real world 22 where, suddenly, a wholesale or dealer step** 

### Page 193

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 has changed their profit margin because a 2 regulatory change drove a higher-cost product**  **3 out? 4 I mean, what happened with**  **5 residential 13 SEER? 6 MR. CYMBALSKY: Correct me if I'm**  **7 wrong, but isn't this just getting at the 8 percent markup is changing?**  **9 MR. BROOKMAN: That's what this 10 slide is intended to elicit. This slide is**  **11 intended to receive comment on whether you 12 think these markups make sense, whether they**  **13 fit with the realities in the markets that 14 you're in.**  **15 Robert? 16 MR. WILKINS: Robert Wilkins,**  **17 Danfoss. 18 I have attended several of these**  **19 meetings and, invariably, this topic gets 20 commented on, and largely the same comments.**  **21 And the way I summarize it, why will 22 I reduce my percentage margins? It doesn't** 

### Page 194

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### make sense that I would make that kind of **2** 

### business decision. And so, I have no evidence **3** 

### one way or the other. Just intuitively, it **4** 

### doesn't make sense. **5** 

### However, DOE has been in this **6** 

### business for a long time, and Navigant has **7** 

### worked with them for a long time. We have done **8** 

### rulemakings on all kinds of commercial **9** 

### products. **10** 

### Why not go back and take a look at **11** 

### some of those and see what happened when we **12** 

### went from 10 to 13 SEER or when we went from **13** 

### "X" percent motors to "Y" percent motors, or **14** 

### so forth? And try to get this out of the **15** 

### academic realm and down to some reality that **16** 

### we can make a decision and not sitting around **17** 

### the table debating about. **18** 

### MR. BROOKMAN: Well, but don't you **19** 

### have a sense of what your distributors' **20** 

### markups are? I mean, can't you say, can't **21** 

### some of you in the manufacturing sector say, **22** 

### "Yes, these look reasonable to me" or "They're

### Page 195

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### off, and a more reasonable number would be the **2** 

### following."? **3** 

### MR. WILKINS: I have always heard **4** 

### people sitting around this table who said that **5** 

### doesn't make sense. That's what I have always **6** 

### heard people say. **7** 

### And it, intuitively, doesn't make **8** 

### sense to me. I'm just thinking that we could **9** 

### add some credibility to it by doing some quick **10** 

### studies, maybe not in time for this **11** 

### rulemaking, but before the next one, that we **12** 

### are not debating this issue. **13** 

### MR. BROOKMAN: Andrew? **14** 

### MR. DELASKI: I guess I would make **15** 

### two points. One is that I have also sat **16** 

### through a lot of these hearings over the years. **17** 

### DOE used to do it the other way. Okay? So, **18** 

### that goes back, I think, before John even **19** 

### worked in the program. So, it goes back. **20** 

### It used to be every dollar spent got **21** 

### the same markup. Okay? So, that goes back to **22** 

### before the year 2000, right?

### Page 196

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### People who I work with argue that **2** 

### that's not the way the real world works **3** 

### because you've got some fixed costs and you've **4** 

### got some variable costs, and you're not going **5** 

### to mark it up the same. You have to cover your **6** 

### fixed costs in a certain fashion, and you've **7** 

### got to cover your variable costs in a certain **8** 

### fashion. **9** 

### But we're talking, I think we're **10** 

### talking -- **11** 

### MR. BROOKMAN: Distributors. **12** 

### MR. DELASKI: And so, it has been **13** 

### going around, and there's a rich history there **14** 

### that you can go back and look at through **15** 

### various dockets. **16** 

### I think for this, in the rulemakings **17** 

### that I have been involved with, people **18** 

### typically want to comment on this, these **19** 

### numbers that are before us. So, I would urge **20** 

### people to do that. **21** 

### We actually have done some work to go **22** 

### back and ask the question, how good is DOE

### Page 197

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### predicting prices? And we actually find they **2** 

### actually aren't very good. They overpredict **3** 

### the prices, right? **4** 

### And our findings are that these tend **5** 

### to be higher than they should be, based on **6** 

### retrospective analysis. I would welcome more **7** 

### retrospective analysis. I think it is a good **8** 

### idea. But I don't know where it will take you. **9** 

### It won't help them in this docket. **10** 

### MR. WILKINS: No. And Robert **11** 

### Wilkins here again. **12** 

### And I recognize that. I wouldn't **13** 

### hold this docket up to resolve this, but I **14** 

### think it would be worth going back and doing **15** 

### some analysis on and have it going forward. **16** 

### You know, I have never been in the **17** 

### market, when I was selling something to a **18** 

### distributor and I came along with a price **19** 

### increase, and he said, "Well, now wait a **20** 

### minute. Is that baseline cost or is it **21** 

### incremental cost, because I need to know how **22** 

### much to increase my margin?" The world

### Page 198

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 doesn't work that way. 2 And so, the assumption might**  **3 implicitly move that way for some reason, but 4 explicitly it doesn't happen.**  **5 MR. BROOKMAN: Okay. Frank? 6 MR. MOORE: So, has anyone actually**  **7 asked a wholesaler or dealer what they do? 8 MR. COOKE: These numbers are**  **9 actually based on a survey that we purchased 10 from HARDI. And we also use markups that go**  **11 along with mechanical contracts to represent 12 the leg of this distribution system that is**  **13 closest to the customer. And we have actually 14 asked the -- in fact, I think I went to your**  **15 conference in Orlando and went around and 16 talked to all of the associations there and**  **17 tried to get better information on what the 18 wholesalers and distributors were adding on.**  **19 MR. MOORE: So, that's the extent of 20 the inquiry. But I think Robert's point is**  **21 that it sounds like to me that we're still in 22 an academic world. It may have improved in** 

### Page 199

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 someone's mind, but we really actually haven't 2 gone on in this instance and asked the**  **3 wholesalers that touch ice machines what their 4 markup is.**  **5 MR. COOKE: We have not talked to a 6 specific wholesaler, but we have talked to the**  **7 associations. In fact, I'm pretty sure I 8 talked to yours at that conference, trying to**  **9 get information. We always welcome more 10 information; that's for sure.**  **11 MR. BROOKMAN: So, if it's possible 12 for the manufacturers to say, "That figure**  **13 there, that makes sense to me," maybe it's a 14 little low; maybe it's a little high, and**  **15 comment in that sort of a vein, that would be 16 helpful here.**  **17 Karim? 18 DR. AMRANE: Karim Amrane with AHRI.**  **19 I mean, to Robert's point, we have 20 made those comments. For years I've been**  **21 coming to these rulemakings for years, and we 22 always make comments about this, but nothing** 

### Page 200

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 has happened. It's always the same. 2 So, I think it's a good idea that**  **3 Robert is suggesting, that maybe, gee, we 4 should go back and try to verify, to validate**  **5 those numbers at some point, maybe not for this 6 rulemaking; maybe for the next rulemaking.**  **7 Because we have been making those comments for 8 years.**  **9 MR. CYMBALSKY: John Cymbalsky, 10 DOE.**  **11 So, at the end of the day, we're going 12 to get to the retail cost of these ice makers.**  **13 And so, if those are right, does this, I guess, 14 matter? I mean, the analysis is going to be**  **15 built around what the retail cost is to the 16 consumer. And we do the life-cycle cost to**  **17 the consumer. And separately, we have the 18 manufacturing analysis going on. And you've**  **19 got these guys in the middle of that. Okay? 20 If we've got the starting point right**  **21 and the end-point right, I guess this is 22 interesting to me, but we're doing an analysis** 

### Page 201

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### on what happens to wholesalers here per se to **2** 

### set the efficiency level. So, I just want to **3** 

### make sure -- we're all getting wrapped up in **4** 

### markups. When we get to the part where we show **5** 

### the retail cost of ice makers, if you think **6** 

### they're wrong and you think we got the **7** 

### manufacturing cost right, which I've heard and **8** 

### we can debate that for a while, because I don't **9** 

### think you agree with that, either, but then **10** 

### this stuff, to me, it is academic in a sense. **11** 

### MR. BROOKMAN: Daryl? **12** 

### MR. ERBS: So, I'm not an economist; **13** 

### I'm an engineer. So, I may misunderstand **14** 

### this. **15** 

### But when I look at this, the concern **16** 

### I have is the incremental cost to the **17** 

### manufacturer gets multiplied by a different **18** 

### total multiplier than the base part of the ice **19** 

### machine. And so, when you look at the total **20** 

### cost to the end-purchaser for adding a **21** 

### technical option, it does matter to have these **22** 

### lower markups at the wholesaler and dealer

### Page 202

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### level. **2** 

### MR. CYMBALSKY: I agree. So, when **3** 

### we get to the part where we show what those **4** 

### costs are, I think that's where we should **5** 

### focus, maybe not so much on these scalers that **6** 

### are on this sheet of paper. But if the final **7** 

### cost comes out to be $1500 and you don't think **8** 

### that's right, I mean, like you said, we can go **9** 

### on the internet and do some searching. We buy **10** 

### a lot of these ourselves. So, we know how much **11** 

### we paid for them. I mean, there's real data **12** 

### there. **13** 

### MR. BROOKMAN: No additional **14** 

### comments here? We're about to move on. **15** 

### We're moving on. **16** 

### MR. COOKE: I think we've covered **17** 

### the next slide, if I'm not mistaken. **18** 

### MR. BROOKMAN: Yes. **19** 

### MR. COOKE: So, moving on to the **20** 

### energy use analysis, this is a midpoint **21** 

### between the engineering analysis and the **22** 

### life-cycle cost and the national impacts

### Page 203

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 analysis. Essentially, we take numbers that 2 come out of the engineering in the form of**  **3 kilowatt hours or gallons of water per 4 hundreds pound of ice, and we translate that**  **5 into energy use or water use on an annual 6 basis.**  **7 Since the engineering analysis 8 really follows the test procedure, we really**  **9 don't have to do a lot of translation to this 10 number other than to make it into an annual**  **11 usage value. And we used two assumptions in 12 addition to the engineering, one of which is**  **13 a 50-percent capacity factor on this 14 equipment, which means it's making ice half**  **15 the time. And another of which is that, when 16 it's not making ice, it's drawing 5 watts of**  **17 power, powering controls, or whatever, when 18 it's just sitting there not making ice.**  **19 So, if there are any comments on the 20 energy use analysis?**  **21 MR. BROOKMAN: Stephen? 22 MR. SCHAEFER: Stephen Schaefer,** 

### Page 204

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### Hoshizaki America. **2** 

### Where did you get the basis for the **3** 

### 50 percent? Is that from end-users? Is that **4** 

### from manufacturers? **5** 

### MR. COOKE: That number has been in **6** 

### our calculations now since the framework **7** 

### analysis. We proposed that number at the **8** 

### framework, and to be honest, that was so many **9** 

### moons ago that I don't even know where we **10** 

### actually got that. And we floated it out at **11** 

### the framework in the preliminary analysis. **12** 

### And I think the bottom line was **13** 

### everyone sort of thought maybe it's a good **14** 

### number; maybe it's high for some types of **15** 

### buildings. But I don't think anyone had any **16** 

### information that they could give us to hone-in **17** 

### on something better. **18** 

### MR. BROOKMAN: Louis Starr? **19** 

### MR. STARR: Actually, maybe the **20** 

### manufacturers could provide some numbers. I **21** 

### think the reason it may be 50 is because that's **22** 

### halfway between zero and 100. That's what I'm

### Page 205

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 guessing. 2 (Laughter.)**  **3 I mean, it's your best guess is what 4 it is. And my tendency, just from what I have**  **5 heard here, is to think it's higher than 50 6 percent.**  **7 But, yes, the manufacturers have 8 information on that. I kind of assumed that,**  **9 because we didn't hear any other numbers, that 10 50 percent was probably a low number rather**  **11 than a high number, is what my takeaway from 12 the previous meeting was.**  **13 MR. BROOKMAN: Stephen? 14 MR. SCHAEFER: Yes, just looking at**  **15 the end-users, I know that if you go in the 16 place and they're running out of ice, that**  **17 means that the machine is still running during 18 the peak times. So, I think it should really**  **19 be higher than 50 percent. We could ask our 20 end-users for comments on that.**  **21 MR. BROOKMAN: I think, as I recall, 22 the thrust of comment perhaps from the** 

### Page 206

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 framework meeting, it was that people, 2 purchasers of ice machines, size them for July**  **3 4th. 4 MR. COOKE: Correct.**  **5 MR. BROOKMAN: So, there's a lot of 6 capacity there, perhaps excess capacity for**  **7 their everyday needs, which is why they 8 arrived at a number more like this. That's my**  **9 recollection. 10 MR. COOKE: And I would have to say,**  **11 for somebody who runs as many of these 12 meetings, I am impressed with your**  **13 recollection of that fact. 14 MR. BROOKMAN: Surprising, isn't**  **15 it? 16 MR. CYMBALSKY: I can you tell you**  **17 the name of a hotel that does not size their 18 ice maker.**  **19 (Laughter.) 20 MR. COOKE: If there are other**  **21 comments on this slide? 22 (No response.)** 

### Page 207

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### If not, we will move on to the **2** 

### life-cycle cost and payback period analysis. **3** 

### Here's where it shows up in our little **4** 

### flowchart. **5** 

### The purpose of this analysis is to **6** 

### get at the economic impacts on the customers. **7** 

### And we measure this in two major ways, one of **8** 

### which is to look at the life-cycle cost of **9** 

### owning the equipment and to measure the **10** 

### savings that occur when you increase the cost **11** 

### of the equipment, but also increase the **12** 

### efficiency of it. We are measuring that **13** 

### upfront cost against the long-term benefits of **14** 

### the energy savings. **15** 

### We also look at this on a payback **16** 

### period basis, which is to say you have that **17** 

### one-time upfront cost. And in the first year, **18** 

### what would be the operating savings for that **19** 

### equipment. And if you divide one into the **20** 

### other, you get a payback. It is a simple **21** 

### payback period calculation. **22** 

### I'm not going to dwell on this. This

### Page 208

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### just shows you where our data comes from. **2** 

### I'll let you read this at your leisure. It is, **3** 

### by the way, straight from the TSD. **4** 

### MR. DESHETLER: A quick question? **5** 

### MR. COOKE: Yes. **6** 

### MR. DESHETLER: So, from an earlier **7** 

### conversation -- **8** 

### MR. BROOKMAN: Please say your name **9** 

### again. **10** 

### MR. DESHETLER: This is Scott **11** 

### DeShetler, Ice-O-Matic. **12** 

### From an earlier conversation, I **13** 

### think we determined that cost of putting in a **14** 

### larger electrical service or bumping out a **15** 

### wall for a machine is not in this calculation, **16** 

### is that correct? **17** 

### MR. COOKE: That is correct. And I **18** 

### think we also discussed that the size changes **19** 

### were all for the ice-making heads that are **20** 

### designed, generally speaking, with maybe a **21** 

### couple of exceptions, to sit on top of **22** 

### something. So, the reason we didn't include

### Page 209

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 that was because the assumption was that you 2 probably wouldn't be knocking out a wall.**  **3 MR. DESHETLER: Not a good 4 assumption.**  **5 MR. BROOKMAN: Thank you. 6 Daryl?**  **7 MR. ERBS: Yes, I did have a 8 question.**  **9 When we make the cabinet larger to 10 accommodate a bigger evaporator or condenser,**  **11 or whatever, did you take into account the 12 increased shipping cost for that product?**  **13 MR. COOKE: Shipping cost, we have, 14 until now, assumed was within the manufacturer**  **15 markup. 16 MR. ERBS: Well, yes, we actually**  **17 cover shipping. But, I mean, if I take a row 18 or two out of a trailer, then my cost per unit**  **19 goes up. 20 MR. BROOKMAN: Detlef?**  **21 MR. WESTPHALEN: I believe that 22 shipping is in there. That's something we can** 

### Page 210

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### confirm. You know, we do consider that. **2** 

### MR. DESHETLER: So, just back to the **3** 

### bumping-out of the wall, the more likely **4** 

### situation will be that the person who is buying **5** 

### this replacement machine will be going from, **6** 

### let's say, 115-volt service to a 230-volt **7** 

### service. Because our initial estimates are **8** 

### that you are going to have to go to higher **9** 

### service to get some of these efficiencies. **10** 

### So, they will have to rewire that **11** 

### restaurant. If they can physically get it in, **12** 

### they may still have to do that wiring. And **13** 

### that is certainly not an inconsequential cost. **14** 

### So, I think that needs to be built into this. **15** 

### MR. COOKE: Okay. **16** 

### MR. BROOKMAN: Thank you. **17** 

### MR. COOKE: Thank you for that. **18** 

### MR. BROOKMAN: Why don't you go to **19** 

### the next slide? **20** 

### MR. COOKE: Yes. So, we have **21** 

### already started talking about the **22** 

### installation cost. Installation cost,

### Page 211

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### repair cost, and maintenance cost were all **2** 

### estimated in the same way. We talked to as **3** 

### many installers as we could, which, as we **4** 

### discussed earlier, turned out to be an **5** 

### amazingly-small number, given that people **6** 

### wouldn't talk to us. **7** 

### We also used RS Means data. And when **8** 

### I get to the repair cost, that's a little bit **9** 

### different as well. **10** 

### So, as you can see, I tried to not **11** 

### have to summarize all the information that's **12** 

### in the TSD. There's a table in there that **13** 

### shows you what the installation cost is by **14** 

### equipment class. And basically, it varies **15** 

### with the size of the machine, with the small **16** 

### ones being set at about $300 and the very large **17** 

### ones, the large water-cooled batch machines, **18** 

### for example, at $1500. **19** 

### With the repair costs, we looked **20** 

### specifically at the equipment that was being **21** 

### changed, the compressors, the condensers, **22** 

### three different types of motors, and

### Page 212

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### essentially assumed that they would be **2** 

### replaced out if the expected lifetime of one **3** 

### of those things is less than eight-and-a-half **4** 

### years. And took a levelized cost, calculated **5** 

### from those repair costs. **6** 

### The maintenance cost looked at the **7** 

### cost of keeping this machine running. We're **8** 

### talking about preventative maintenance, **9** 

### looking for leaks in the refrigeration lines, **10** 

### cleaning the machine a couple or three times **11** 

### a year, and those types of costs. **12** 

### MR. BROOKMAN: Chris? **13** 

### MR. SALATINO: Chris Salatino from **14** 

### Scotsman Ice. **15** 

### As far as the annual repair costs and **16** 

### annual maintenance costs, did you factor in **17** 

### any higher level of repair cost due to an **18** 

### expedited product development schedule? **19** 

### MR. COOKE: We did not. We took **20** 

### literally it straight from the manufacturers' **21** 

### analysis or the engineering analysis, took the **22** 

### cost from that and marked it up for the various

### Page 213

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### costs that a repair person would mark things **2** 

### up for. **3** 

### Water and electric prices, this is in **4** 

### some respects a fairly standard slide. We use **5** 

### EIA base year numbers. In this case, it was **6** 

### from the calendar year 2012. We used the **7** 

### Annual Energy Outlook 2013 to provide us an **8** 

### escalation in electricity prices. **9** 

### Since water is a major component of **10** 

### the operating cost stream, we needed water **11** 

### costs, and those were based on the American **12** 

### Water Works Association Rate Survey. There **13** 

### was a new one that came out last summer. So, **14** 

### this is fairly fresh data. **15** 

### We escalated the base year water and **16** 

### wastewater price using an average calculated **17** 

### from a long-term CPI for water utility costs. **18** 

### As some of you might recall who have **19** 

### been around this process for a while, we have **20** 

### started adding in a factor to adjust the **21** 

### estimated manufacturer's cost for what's **22** 

### called experiential or price learning. In

### Page 214

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### this particular case, it turned out to be a **2** 

### very small number. **3** 

### For the LCC analysis, we need to take **4** 

### the engineering estimate of cost, which was **5** 

### done in 2012 and escalate that to the year when **6** 

### we assumed that this standard would go into **7** 

### effect, which I believe we assumed to be 2018. **8** 

### So, there's approximately a 4/10ths of 1 **9** 

### percent decline during that period, just based **10** 

### on this experiential learning analysis. **11** 

### There are other inputs. **12** 

### MR. BROOKMAN: Karim? **13** 

### DR. AMRANE: Yes, Karim Amrane with **14** 

### AHRI. **15** 

### How did you get the data on the **16** 

### experimental learning? **17** 

### MR. BROOKMAN: Experiential. **18** 

### DR. AMRANE: Experiential. **19** 

### MR. COOKE: The experiential **20** 

### learning. **21** 

### DR. AMRANE: Yes. **22** 

### MR. COOKE: We used a PPI that is

### Page 215

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 associated -- or excuse me -- a Producer Price 2 Index associated with commercial**  **3 refrigeration. There are three or four 4 others -- it's actually in the NIA analysis;**  **5 there's a slide about it. 6 But it's the PPI that is closest to**  **7 the commercial refrigeration category of 8 equipment.**  **9 DR. AMRANE: So, it was not even for 10 commercial ice makers?**  **11 MR. COOKE: It's not specific to 12 commercial ice makers because there is not one**  **13 at that level of -- 14 DR. AMRANE: So, how confident are**  **15 you that it applies to commercial ice makers? 16 MR. COOKE: I am as confident as I**  **17 can be, given that it is bundled into that 18 group. And we actually did really look at**  **19 this number. It is a small number. And even 20 over the 30-year forecast period, it's still**  **21 under, as you will see when we get to the NIA, 22 is still under 2 percent. It is a very small** 

### Page 216

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 number, and we really looked at that and asked 2 various questions about confidence in it, but**  **3 decided to include it. 4 And you are free to comment, Karim.**  **5 DR. AMRANE: Sure, sure. Of 6 course, I am free to comment.**  **7 But I guess, from the stakeholder's 8 standpoint, I think it's DOE's burden to show**  **9 us that, indeed, those numbers mean something. 10 MR. CYMBALSKY: So, to be clear, the**  **11 commercial ice makers is bundled into this 12 Producer Price Index that is more general**  **13 commercial refrigeration. 14 MR. COOKE: Correct.**  **15 MR. CYMBALSKY: So, to the extent 16 that commercial ice maker’s different from the**  **17 entire category as a whole, that's what the 18 argument is here, yes.**  **19 MR. COOKE: That's correct. And 20 the fact that commercial ice makers would**  **21 probably be a very small part, under what, 5 22 percent of the whole? I think that is the** 

### Page 217

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### argument. **2** 

### MR. BROOKMAN: Just to clarify for **3** 

### the record, that was John Cymbalsky and, then, **4** 

### back to Alan. **5** 

### So, thanks for both of those **6** 

### contributions. **7** 

### MR. COOKE: So, we use discount **8** 

### rates that are based on the types of customers **9** 

### that would be purchasing this equipment. **10** 

### There is a database that we can download off **11** 

### the web that has a lot of information. We **12** 

### calculate them. And when we do our Monte **13** 

### Carlo analysis and the life-cycle cost, we **14** 

### just pick a calculated discount rate out of the **15** 

### bin and run a specific customer's discount **16** 

### rate. **17** 

### We assumed an average lifetime of **18** 

### eight-and-a-half years, but in the LCC **19** 

### analysis that eight-and-a-half-year number **20** 

### really isn't used. We actually use a range of **21** 

### lifetimes ranging from 4 to 12 percent. And **22** 

### if you do a weighted average of our probability

### Page 218

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 of pulling the numbers out, it works out to 2 eight-and-a-half years.**  **3 All of the inputs are documented in 4 TSD Chapter 8.**  **5 DR. AMRANE: Chris? 6 MR. SALATINO: Chris Salatino,**  **7 Scotsman Ice. 8 So, one of the items that I think I**  **9 just commented on, or I know that I just 10 commented on, are increased warranty due**  **11 to -- or increased maintenance and repair due 12 to an expedited development time.**  **13 I think, well, I know we can provide 14 data that would help give some context to that**  **15 statement No. 1. 16 And then, No. 2, does the evaluation**  **17 include additional training required for the 18 field for new equipment?**  **19 MR. COOKE: It is not does. It is 20 just looking at an estimate of cost based on**  **21 information that is available today. 22 MR. SALATINO: That would be** 

### Page 219

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### something that we would -- it would be helpful **2** 

### to train our -- **3** 

### MR. BROOKMAN: John Cymbalsky **4** 

### MR. CYMBALSKY: So, I know that in **5** 

### most of our rules -- and I'll assume that this **6** 

### is the same -- that the newer, more efficient **7** 

### technologies definitely have a higher **8** 

### incidence of both failure and repair costs **9** 

### associated with it. So, in my mind, that is **10** 

### a proxy for what you're describing, in the fact **11** 

### that these things aren't as established in the **12** 

### market for a long period of time. And so, to **13** 

### the extent that the way they're manufactured **14** 

### or the parts that they use or the fact that **15** 

### they're sophisticated and they break more and **16** 

### cost more to repair, that is in the analysis. **17** 

### So, I think we are picking up what **18** 

### you're describing in the upstream root cause **19** 

### of the issue in the downstream numbers for the **20** 

### repair costs. **21** 

### MR. COOKE: Right. **22** 

### MR. SALATINO: And that's only half

### Page 220

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 of it. The other half is the expedited 2 development time.**  **3 So, if we are required in our 4 particular case to turn over 90 percent of our**  **5 portfolio in three years, in order to do that, 6 we would likely have to cut some of our**  **7 traditional product development processes. 8 If that's the case, then we're at risk of**  **9 assuming more reliability issues because of 10 that.**  **11 So, it's twofold. It's, one, to 12 what you were talking about, the increased**  **13 technology and required service for that. 14 The other part is that expedited development**  **15 process and what we are at risk for there. 16 MR. BROOKMAN: Thank you, Chris.**  **17 That's good. 18 MR. CYMBALSKY: Yes. Yes, it would**  **19 be interesting to see how we disentangle that, 20 those two effects. But we would appreciate**  **21 the data. 22 MR. COOKE: I mentioned briefly the** 

### Page 221

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### Monte Carlo analysis. We run 10,000 **2** 

### scenarios for each one of these equipment **3** 

### classes. We vary the items listed here on the **4** 

### page. You can read as well as I can. So, I'll **5** 

### let you look at that. **6** 

### And we welcome any comments on the **7** 

### average equipment lifetimes, any additional **8** 

### information that you might have that would **9** 

### help us estimate installation costs or repair **10** 

### and maintenance costs. And I think we have **11** 

### already gotten a lot of this feedback. **12** 

### MR. BROOKMAN: Additional comments **13** 

### on item 7, 8, and 20, as listed here on slide **14** 

### 63? **15** 

### Yes, Andrew? **16** 

### MR. DELASKI: I want to talk about **17** 

### cost. I want to go back to a prior electrical **18** 

### cost topic, which is the loading issue. **19** 

### And what I heard is that perhaps that **20** 

### 50-percent number is a bit low. And as I have **21** 

### been thinking here, it strikes me that the **22** 

### Department could reach out to some of the other

### Page 222

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### potential stakeholders, as has been mentioned **2** 

### earlier, the Restaurants Association, the **3** 

### Hotel Association. You might be able to get **4** 

### some additional data from folks like that, **5** 

### back to the user groups that we mentioned **6** 

### earlier as being a potential source. **7** 

### What I heard earlier from some of the **8** 

### manufacturers -- and you all can comment -- is **9** 

### that on some of these products, they are really **10** 

### maxed-out. Your drive-through example, **11** 

### right, that product is probably operating at **12** 

### higher than 50 percent. You know, there may **13** 

### be others that are -- 50 percent, as you said, **14** 

### is the midpoint. There is really a range **15** 

### happening here. And to capture that range, it **16** 

### may vary; it almost certainly varies by **17** 

### product type. And I would suggest that there **18** 

### may be a question that you could pose to these **19** 

### guys that might help you get at that as well. **20** 

### You guys can talk better to that, of course, **21** 

### than I would. **22** 

### MR. BROOKMAN: Yes, Scott?

### Page 223

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### MR. BINGHAM: This is Scott Bingham **2** 

### with Follett. **3** 

### I would say that there are some max **4** 

### times, but the industry has been trending **5** 

### towards moving ice makers away from large bins **6** 

### in the back and towards putting them onto **7** 

### smaller dispensers upfront. And this smaller **8** 

### storage space in that dispenser would lend **9** 

### itself to a lesser duty cycle because you have **10** 

### only, instead of a 2,000-pound bin, a **11** 

### 200-pound hopper. And so, once the **12** 

### restaurant closes at 11 o'clock or midnight, **13** 

### the ice machine will run for a certain period **14** 

### of time to fill it up, and then, it is off for **15** 

### the rest of the night; whereas, that **16** 

### 2,000-bin, if you used a great amount of that **17** 

### ice during the day, if you sized it properly, **18** 

### it will be running most of the night to catch **19** 

### up. **20** 

### And so, I would say that that number, **21** 

### I don't think that's a high number. We do have **22** 

### some data. I don't think our customers will

### Page 224

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### know the answer to that question. All they **2** 

### know is, if they open their bin, if there's ice **3** 

### there. They don't know how long it ran **4** 

### overnight. **5** 

### So, I will provide some comment **6** 

### there, and I don't think it's a high number. **7** 

### MR. BROOKMAN: I thought you were **8** 

### saying, because the trend is towards smaller **9** 

### units delivering the ice, the amount of time **10** 

### that that unit is actually cranking is more. **11** 

### MR. BINGHAM: Is less. It is less. **12** 

### MR. BROOKMAN: Okay. **13** 

### MR. BINGHAM: Because it doesn't **14** 

### have as large of a storage hopper to -- **15** 

### MR. BROOKMAN: Okay. **16** 

### MR. BINGHAM: -- fill through the **17** 

### night. **18** 

### MR. BROOKMAN: Okay. **19** 

### Additional comments here? **20** 

### (No response.) **21** 

### MR. COOKE: This slide here is a **22** 

### little tiny bit out of order, but it is needed

### Page 225

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 to provide context for the tables that come 2 along.**  **3 This is where we transition, as Daryl 4 was stumbling over, a little earlier, we**  **5 transition from efficiency levels to TSLs. 6 And we have defined TSLs in the way that we have**  **7 here on this page. 8 The TSL5 is the maximum efficiency**  **9 level. That's that max tech level. 10 TSL3, if you look at the National**  **11 Impacts Analysis, TSL3 is the efficiency level 12 for each equipment class that has the highest**  **13 NPV. Generally speaking, they go up and, 14 then, they go down. And the point where it is**  **15 at the highest, that is the efficiency level 16 for each equipment class that is included in**  **17 TSL3. 18 TSL4, which I skipped, is actually**  **19 just an intermediate point between TSL3 and 20 TSL5. There's a fairly-lengthy description**  **21 in the NOPR of all of the conditions we've 22 placed on determining what efficiency level** 

### Page 226

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 was TSL4. I didn't actually reproduce the 2 whole description here. It is an**  **3 intermediate point. 4 TSL1 was set equal to the original**  **5 ENERGY STAR 10-percent efficiency improvement 6 level, and TSL2 is another intermediate point,**  **7 just so we don't have any big jumps between 8 these TSLs.**  **9 So, with that in mind, these are the 10 Life-Cycle Cost Savings by Equipment Class.**  **11 I think John was mentioning earlier the total 12 equipment cost for each of these classes after**  **13 we add the markups. I don't have a slide for 14 that in this deck. So, I would have to refer**  **15 you to either the NOPR or the TSD to see that, 16 and you should be able to see that in Chapter**  **17 8 of the TSD. 18 You can see just the highest NPV**  **19 point tends to also be the highest life-cycle 20 cost point. It's not true in all cases, but**  **21 in most cases it is. So, you can see TSL3 22 tends to be the best level on this slide as** 

### Page 227

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 well. 2 The next slide, where we talk about**  **3 payback periods, again, it is by TSL. And I 4 would just highlight the fact that there's a**  **5 fairly-marked jump between TSL3 and TSL4. In 6 TSL3 you see a lot of -- well, none of the**  **7 payback periods are greater than 2.27 years, 8 and a lot of them are actually under one year.**  **9 And there's a fairly big percentage 10 jump in a lot of these between TSL3 and TSL4.**  **11 That is because even though there's a lot more 12 energy efficiency to be gleaned at TSL4, the**  **13 cost that goes along with it is steep enough 14 that it becomes a real hurdle.**  **15 MR. BROOKMAN: Louis, do you want in 16 here?**  **17 MR. STARR: So, Louis Starr with 18 NEEA.**  **19 So, it sounds like there is 20 cost-effective savings over the lifetime for**  **21 all of them, but what you decide to set the 22 standard level is when the incremental cost** 

### Page 228

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### got to be so much. I think you were talking **2** 

### about that. But, normally, you would think **3** 

### that, if the life-cycle costs were there and **4** 

### it paid back in its lifetime, that that would **5** 

### be the level that you would set it at. But you **6** 

### have set it at a lower level. Maybe you can **7** 

### explain that a little bit more. **8** 

### MR. COOKE: Well, I think that that **9** 

### was why I said that the TSL discussion was a **10** 

### little bit out of place because we have not **11** 

### covered the NIA and the Manufacture Impact **12** 

### Analysis, all of which figures into this. **13** 

### MR. STARR: So, that is what is **14** 

### really affecting it? It is not the cost **15** 

### affecting it, but it is how it impacts the **16** 

### manufacturer in terms of their ability to stay **17** 

### in business or reach those levels without -- **18** 

### MR. COOKE: You know, this clearly **19** 

### played into it because I think there is a **20** 

### fairly discrete jump between TSL3 and TSL4, **21** 

### but it really was a combination of all of these **22** 

### things. And you can't see a whole context

### Page 229

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### until you get all the pieces. So, hold that **2** 

### thought. **3** 

### MR. CYMBALSKY: So, I will **4** 

### say -- this is John Cymbalsky -- I will say I'm **5** 

### looking at my notes from when we put this **6** 

### together. **7** 

### And for TSL4 and 5, this is where the **8** 

### proprietary technology comes into play, **9** 

### another reason for rejection. **10** 

### MR. COOKE: We also did what we call **11** 

### a life-cycle cost subgroup analysis, where we **12** 

### look at some of the groups that we think might **13** 

### be particularly disadvantaged by a standard, **14** 

### and just look at the life-cycle costs impacts **15** 

### on them. **16** 

### We looked, in particular, at lodging **17** 

### and food service. Lodging faces the highest **18** 

### capital costs, according to this database that **19** 

### we pulled information out of. Food service **20** 

### experienced higher-than-average electricity **21** 

### prices and higher-than-average capital costs, **22** 

### although it is not nearly as high as the

### Page 230

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### lodging. **2** 

### In essence, the standard, the TSL3 **3** 

### standard, I should say, remains **4** 

### cost-effective for both subgroups. They do **5** 

### take a hit on the life-cycle cost. And for the **6** 

### food service, it was a fairly small hit because **7** 

### their energy cost is higher, which means that **8** 

### the value of those energy savings is higher. **9** 

### For lodging, it was a little bit bigger hit **10** 

### because their energy cost, I think, if I **11** 

### remember correctly, is actually a little bit **12** 

### less than the national average. So, that **13** 

### higher capital cost hit them **14** 

### disproportionately. **15** 

### MR. BROOKMAN: Daryl? **16** 

### MR. COOKE: Go ahead. **17** 

### MR. ERBS: Daryl Erbs, Manitowoc **18** 

### Ice. **19** 

### So, I won't go through all of my **20** 

### comments I've already made around how there **21** 

### might be some errors in the cost model. But, **22** 

### you know, one of the things that I do find

### Page 231

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 interesting is the small categories have the 2 longest payback period. The small-sized ice**  **3 machine, whether it be water-cooled or 4 air-cooled, ice-making head or self-contained**  **5 units, tend to be favored by small, individual 6 proprietors who are just operating a**  **7 restaurant, a coffee shop, as well as a lot of 8 the lodging, and a lot of the ice machines on**  **9 hotel floors, as someone mentioned earlier, 10 don't make enough ice. They're small units.**  **11 And particularly if there is some 12 error on the side of these small units, which,**  **13 by the way, are also the ones that can grow in 14 size, like to meet the standard, so that's**  **15 where I have the most concern about the 16 accuracy of the cost. These are cash**  **17 businesses. 18 So, I understand life-cycle cost,**  **19 and it should make sense to anyone, you know, 20 to maximize their life-cycle cost, but the**  **21 real situation we face in the marketplace is, 22 if it pays back in a year, most of the time** 

### Page 232

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 they'll buy it. Two years, maybe if it is a 2 large chain where there's some benefit to the**  **3 brand, right, to do things that are 4 environmentally -- but when you get to a**  **5 mom-and-pop, they're just looking at, will I 6 get my money back this year?**  **7 And so, the categories where I think 8 people are most sensitive to the payback**  **9 period are the ones where we have the longest 10 payback period. So, my view is we are**  **11 disadvantaging what I would call, you know, 12 the small, individual proprietor kind of**  **13 operator of a restaurant. 14 MR. BROOKMAN: John Cymbalsky?**  **15 MR. CYMBALSKY: So, I will say, you 16 know, I didn't know this earlier when we were**  **17 talking in the beginning about the rebuttable 18 assumption and less than three years. So, I**  **19 have been on this job for, I don't know, 20 three-and-a-half years now. And I've never**  **21 seen payback periods so low, actually. 22 So, your point is taken about cash** 

### Page 233

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### businesses and paybacks. But, based on the **2** 

### rules I'm familiar with and worked on, these **3** 

### are very, very small paybacks in terms of what **4** 

### we have done compared to the life of the **5** 

### equipment, too. We are talking **6** 

### eight-and-a-half on average but 12 or 14 **7** 

### total. So, the TSL3 pays back very quickly. **8** 

### MR. ERBS: And, yes, I was just **9** 

### looking at across all of the smalls listed on **10** 

### this chart. Some of the smalls, there is a big **11** 

### leap between TSL3 and 4. **12** 

### MR. CYMBALSKY: I'm just looking at **13** 

### this. I think Daryl is alluding to the top **14** 

### one. **15** 

### MR. ERBS: Yes, to the top one, I **16** 

### know, yes. Yes. **17** 

### MR. CYMBALSKY: So, to a two-year, **18** 

### two-years-and-a-few-months -- **19** 

### MR. ERBS: Yes. **20** 

### MR. CYMBALSKY: -- payback in my **21** 

### world is very short. **22** 

### MR. ERBS: Yes. So, Daryl,

### Page 234

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 Manitowoc Ice. 2 I don't believe these, based on the**  **3 data we have around cost assumptions. And 4 that combined with, you know, the earlier**  **5 discussion we had around some of the technical 6 options -- so, if I really believed these were**  **7 true, I might still have a little bit of 8 concern with the ones that are two-plus years.**  **9 The other ones, I would say, yes, but, again, 10 I am very concerned that these are not**  **11 accurate, and if it turns out to be five years 12 instead of three years for a small**  **13 water-cooled batch ice-making head, that is 14 going to really impact the market.**  **15 I think we, as manufacturers, are 16 very concerned about what happens to the size**  **17 of the ice machine market. You know, how many 18 will we sell in light of these changes? There**  **19 is a price elasticity point, and the smaller 20 you get, the less elastic, right? And people**  **21 will get to a point where they will buy bagged 22 ice or they will do something, but they won't** 

### Page 235

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 buy ice machines anymore. 2 MR. CYMBALSKY: So, you're setting**  **3 Alan up for his next section on shipments 4 analysis here.**  **5 MR. COOKE: That's right. 6 MR. CYMBALSKY: So, good segue.**  **7 MR. BROOKMAN: Final comments 8 before we move to shipments?**  **9 Laura? 10 MS. PETRILLO-GROH: Laura Petrillo,**  **11 AHRI. 12 I just would like to echo what Daryl**  **13 mentioned. We have a lot of concerns about 14 the inputs into the analysis. To see numbers**  **15 that are so favorable, I think that reinforces 16 the point that there are problems with the**  **17 concern that lead to such a favorable outcome 18 for the payback periods.**  **19 Just looking at the compressor cost, 20 as we have discussed multiple times, you know,**  **21 we would really like to see these numbers 22 reevaluated and alternative refrigerants** 

### Page 236

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 included in this before we move forward. 2 These numbers may not be accurate.**  **3 MR. BROOKMAN: Okay. 4 MS. PETRILLO-GROH: Thank you.**  **5 MR. BROOKMAN: Thank you. 6 On to shipments.**  **7 MR. COOKE: Shipments, here we are 8 on the graphic. The purpose of this analysis**  **9 is, of course, to estimate shipments, just 10 like the name says, over a 30-year period.**  **11 The main source of the data that we 12 used, the historical data, was AHRI data that**  **13 was provided during the preliminary analysis, 14 or actually prior to the preliminary analysis**  **15 phase. So, it is basically AHRI data from 16 2010.**  **17 We did have information for consumer 18 or current industrial reports from NAAFEM. I**  **19 don't believe either of those datasets 20 actually made their way into the analysis**  **21 underlying this NOPR. 22 We have been looking at ENERGY STAR** 

### Page 237

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 since we submitted this, essentially, put our 2 pencils down and submitted this NOPR. There**  **3 was a new ENERGY STAR report that came out. 4 And if you look at the shipment**  **5 numbers in there, it is a little bit higher 6 than AHRI data over time, which would reflect**  **7 the fact that there are companies like Follett 8 that probably aren't in the AHRI data, but**  **9 would be in the ENERGY STAR data. So, I am 10 kind of thinking we might be using the ENERGY**  **11 STAR shipments information at the final rule. 12 So, it would be a little bit higher than this,**  **13 but not much, a little, tiny bit for the 14 shipments.**  **15 We use, as a driver for new 16 purchases, for new shipments, we use the AEO**  **17 2013 commercial floorspace model. One of the 18 things that came straight out of the AHRI data**  **19 is the percentage of shipments by the type of 20 equipment. And this probably actually**  **21 underlines a little bit of Daryl's point, 22 which is that a lot of the more important** 

### Page 238

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 classes are the small classes. 2 I think if you add up four of the**  **3 small classes, you get approximately 60 4 percent of the shipments. So, small**  **5 ice-making classes are very important. 6 We held this constant throughout the**  **7 30-year forecast period. I think there's a 8 time later where we will be asking if there's**  **9 additional information. 10 Here's the projection of the**  **11 shipments in a graph that, hopefully, those of 12 you in the back of the room can see, given the**  **13 color of the bar. 14 In total, over the 30-year period,**  **15 there's about 6.7 million ice makers that 16 shipped. The stock in 2018 was estimated as**  **17 about 1.44 million units. And it is somewhere 18 in the neighborhood of the 150 to 200 thousand**  **19 units per year that somebody was mentioning 20 earlier.**  **21 The shipments feed directly into the 22 National Impacts Analysis where we estimate** 

### Page 239

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 the total national energy savings and in this 2 case some water savings and, also, where we**  **3 estimate the Net Present Value of these 4 changes at a national level.**  **5 So, we use a lot of the inputs that 6 came from the LCC analysis. We also need a**  **7 site-to-source ratio and, also, a full 8 fuel-cycle ratio to take that end-use customer**  **9 impact up to either the mine mouth or the 10 natural gas well field, wherever it might be,**  **11 to get the total impact on energy for the 12 nation.**  **13 We estimate a base case and, then, 14 standards cases for each of these levels that**  **15 we have analyzed, and the difference is the 16 national impact.**  **17 There was one other set of 18 assumptions that hasn't been shown yet, and**  **19 that has to do with what is the base case. 20 Where are units shipped now in terms of**  **21 efficiency? 22 If you look at, for example, ENERGY** 

### Page 240

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### STAR, for the equipment that was in ENERGY **2** 

### STAR, the Version 1 of the standards, **3** 

### somewhere between 60 and 67 percent of **4** 

### equipment for like the last three or four years **5** 

### would actually be at Level 2, which is what we **6** 

### call the ENERGY STAR level, at Level 2 or **7** 

### higher. **8** 

### This was actually based on the **9** 

### available products in the market today, using **10** 

### the market database that Detlef discussed **11** 

### earlier. So, this is where the units are that **12** 

### you, the manufacturers, are currently making. **13** 

### Three questions. We certainly **14** 

### would welcome information that might help us **15** 

### to decide whether or not holding in place the **16** 

### market shares by equipment classes is **17** 

### appropriate, whether that base efficiency **18** 

### distribution is a good distribution. And **19** 

### there's a third one here. Oh, the third one, **20** 

### there is a product class that I think was **21** 

### alluded to earlier on in the engineering and **22** 

### the marketing or the market assessment level,

### Page 241

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### which has to do with remote compressor units **2** 

### that are actually designed to be attached to **3** 

### compressor racks as opposed to a dedicated **4** 

### remote compressor. So, we just wanted to get **5** 

### an idea of what kind of a market share that has **6** 

### because I don't think we have really good data **7** 

### on that. **8** 

### MR. BROOKMAN: Louis? **9** 

### MR. STARR: So, this is Louis Starr **10** 

### with NEEA. **11** 

### I was looking at slide 72 there. And **12** 

### so, you've got, it looks like, I'm assuming **13** 

### that you came up with that assuming the average **14** 

### life of the ice machine being eight years. **15** 

### So, essentially, you got 25,000 in new, and **16** 

### then, the rest is replacement, right? Is that **17** 

### kind of how you came up with that ratio of **18** 

### new-to-replaced or how -- **19** 

### MR. COOKE: I think that basic ratio **20** 

### is used to come up with that split. And then, **21** 

### that split gets held constant. **22** 

### MR. STARR: Okay. And so, then, the

### Page 242

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 new green or the green portion of that, the 2 dark green portion is basically the growth in**  **3 new restaurants, in other words, new places 4 opening? And then, the multiplication is the**  **5 replacement of those units? 6 MR. COOKE: That would be new**  **7 restaurants, hotels -- 8 MR. STARR: Okay.**  **9 MR. COOKE: -- offices, hospitals, 10 retail, you know, grocery stores. There's**  **11 one I'm missing, two that I'm missing. 12 Anyway, so there's several different**  **13 classes of businesses that actually use ice 14 makers.**  **15 MR. STARR: And the way you 16 projected that growth is based upon**  **17 population? Or how did you go about that? 18 MR. COOKE: We split it out to the**  **19 individual business type based on some 20 information that came from a DOE report on**  **21 technical potential and conservation 22 potential in commercial buildings, commercial** 

### Page 243

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 refrigeration, in particular. 2 I do believe there is a reference**  **3 cited in there, in the TSD, that will give you 4 that exact information.**  **5 MR. CYMBALSKY: But I think for new 6 placements of these things, you're using the**  **7 AEO commercial building floorspace. 8 MR. COOKE: That's right.**  **9 MR. CYMBALSKY: So, the number of 10 hotels that are built, you know.**  **11 MR. COOKE: Right. 12 MR. CYMBALSKY: So, additions to**  **13 floorspace by the building type that uses this 14 equipment is what drives the new purchases.**  **15 MR. COOKE: Right. Well, what we 16 did was we split it up to the building types,**  **17 and then, we used the AEO. 18 MR. CYMBALSKY: Right.**  **19 MR. COOKE: Basically, a 20 year-to-year ratio, what is this year to next**  **21 year. We have a base year number and we just 22 scale it either up or down, depending on what** 

### Page 244

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### the growth in commercial floorspace is. **2** 

### MR. CYMBALSKY: Right. **3** 

### MR. BROOKMAN: Okay. Thanks, John. **4** 

### Yes? **5** 

### MR. RAWALD: I just want to close the **6** 

### loop. John was asked earlier about the **7** 

### citation for the case that he was talking **8** 

### about. He was talking about NEMA v. DOE, a **9** 

### case out of the 4th Circuit. I don't have the **10** 

### exact legal citation for it, but you can find **11** 

### it if you do a quick internet search. And it **12** 

### is from 2011. **13** 

### MR. BROOKMAN: Okay. Thank you, **14** 

### Doug. **15** 

### Are we, then, back? **16** 

### MR. COOKE: Yes. **17** 

### MR. BROOKMAN: Back to Alan. **18** 

### MR. COOKE: Back to me and moving **19** 

### forward. **20** 

### So, we are now on the price trends. **21** 

### We discussed this earlier, and it is based on **22** 

### the PPI series refrigeration, air

### Page 245

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### conditioning, and warm air and heating **2** 

### equipment, which, as we discussed earlier, ice **3** 

### makers is part of it. It is a small part of **4** 

### it. It is the PPI that is essentially as close **5** 

### to ice makers as exists. **6** 

### And for those of you in the back of **7** 

### the room who can't see the scale on, I guess **8** 

### it would be the left side of the screen here, **9** 

### this starts at 1.0, which would be no change, **10** 

### and the bottom of it is .9. **11** 

### In essence, over the 30-year period, **12** 

### there's about a 2-percent decline in the **13** 

### price. And we have had some discussion on it. **14** 

### If there are any other comments, this would be **15** 

### the time. **16** 

### And this was used in the NIA. **17** 

### MR. DESHETLER: Scott DeShetler, **18** 

### Ice-O-Matic. **19** 

### And I'm not sure exactly how you have **20** 

### run your model here. But my sense is that what **21** 

### you're going to see is, when these new **22** 

### standards go into place, you are going to see

### Page 246

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 a significant bump in price. Your assumption 2 that your price -- what did you call**  **3 it? -- experiential price will take into 4 effect is probably correct, but I think you**  **5 have got to bump that whole piece up. I think 6 your line goes like this. I don't think it**  **7 goes like this. 8 MR. CYMBALSKY: So, this is John**  **9 Cymbalsky. 10 So, the standard will come in and**  **11 that equipment will cost more money. So, that 12 is not what you are seeing here.**  **13 What you are seeing is in the year 14 that the standard comes in, let's say it costs**  **15 $300 more for that piece of equipment. This 16 scale would, then, over time knock down that**  **17 $300 increment. 18 MR. DESHETLER: Okay. So, this is**  **19 from the time it comes into place? Got you. 20 MR. CYMBALSKY: Correct.**  **21 MR. BROOKMAN: Thank you, John. 22 You can see the comment box there.** 

### Page 247

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 On methods to improve its equipment price 2 forecasting as well as any data supporting**  **3 alternative methods -- any additional 4 thoughts here?**  **5 (No response.) 6 MR. COOKE: Other inputs to the**  **7 National Impact Analysis are the discount 8 rate. We use the 3 percent and the 7 percent**  **9 that is derived from some official government 10 guidance. We discounted all future expenses**  **11 to 2013. Everything was denominated in 2012 12 dollars, just in case that hasn't come up**  **13 before now. 14 And we have already talked about the**  **15 site-to-source ratio. And that was developed 16 from NEMS, which is the model that underlies**  **17 the EIA's Annual Energy Outlook. 18 So, here are the quad savings. You**  **19 can see by equipment classes with the total for 20 the TSLs at the bottom of the page.**  **21 I'm not sure I have a whole lot to say 22 about that, other than the TSL that we selected** 

### Page 248

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### for the standard TSL3 has a little bit over a **2** 

### quarter of a quad savings over the life of this **3** 

### equipment purchased between 2018 and 2047. **4** 

### Yes? **5** 

### MR. BROOKMAN: Chris? **6** 

### MR. SALATINO: Chris Salatino. **7** 

### As far as the energy savings, is that **8** 

### with a 50-percent runtime assumption? **9** 

### MR. COOKE: Yes, it is. **10** 

### MR. SALATINO: Thank you. **11** 

### MR. CYMBALSKY: So, just to put this **12** 

### in perspective -- **13** 

### MR. BROOKMAN: John Cymbalsky. **14** 

### MR. CYMBALSKY: -- because -- I'm **15** 

### bad at that, aren't I? **16** 

### MR. BROOKMAN: You're doing better. **17** 

### John Cymbalsky. **18** 

### MR. CYMBALSKY: So, we are saving **19** 

### .286 quads over 30 years, and the U.S. economy **20** 

### uses 100 quads in a single year. So, I just **21** 

### want to put that in perspective. **22** 

### MR. BROOKMAN: Daryl?

### Page 249

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### MR. ERBS: Daryl Erbs, Manitowoc **2** 

### Ice. **3** 

### I can't resist just saying, then why **4** 

### are we wasting all this time? **5** 

### (Laughter.) **6** 

### MR. CYMBALSKY: It's a statutory **7** 

### requirement. I set you up for that. **8** 

### (Laughter.) **9** 

### So, 100 quads is roughly what the **10** 

### entire U.S. economy uses in a year. So, that **11** 

### includes everything, transportation, **12** 

### residential, commercial, industrial. And **13** 

### so, over 30 years, this is saving about a third **14** 

### of a quad. So, I just want to put everything **15** 

### in perspective. But every little bit helps, **16** 

### right, Daryl? **17** 

### (Laughter.) **18** 

### MR. COOKE: The next slide is the Net **19** 

### Present Value. So, you can see clearly here **20** 

### TSL3 is the highest TSL, which is the one, the **21** 

### definition of TSL3. The Net Present Value of **22** 

### that is considerably higher than the other

### Page 250

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 levels. 2 I don't believe when we get to the**  **3 emissions analysis that there is a slide that 4 talks about it, but if you actually take this**  **5 up one level and add on the value of emissions 6 to this, TSL3 is still the highest TSL level.**  **7 So, it came out looking pretty good from that 8 perspective.**  **9 MR. BROOKMAN: Questions on this 10 before we move on?**  **11 (No response.) 12 Okay.**  **13 MR. COOKE: I'm going to go over one 14 more small piece of this before I give it over**  **15 to Ben Barrington to do the MIA. And that's 16 the Regulatory Impact Analysis.**  **17 In this, we investigate an 18 alternative or some alternatives to setting**  **19 standards. This slide here is, relatively 20 speaking, a boilerplate kind of standard**  **21 because there's a lot of things that we could 22 look at.** 

### Page 251

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### In fact, what we ended up looking at **2** 

### was two things. We looked at consumer rebates **3** 

### and a consumer tax credit. And the model that **4** 

### we had in our line when we were analyzing this **5** 

### was what you see right now with ENERGY STAR, **6** 

### where utilities across the country almost all **7** 

### seem to peg their efficiency rebates to, if you **8** 

### have a unit that qualifies for ENERGY STAR or **9** 

### maybe if you have a unit that qualifies for **10** 

### CEE2, assuming that that still exists now that **11** 

### ENERGY STAR has changed their efficiency **12** 

### levels. **13** 

### If you look at the ENERGY STAR data, **14** 

### they have achieved, fairly consistently, **15** 

### about a 60-percent penetration year-in and **16** 

### year-out of the equipment costs that are **17** 

### covered by those standards. **18** 

### So, we asked the question, well, what **19** 

### would happen if we were to set a program that **20** 

### looked kind of like that, equivalent to TSL3, **21** 

### and we got 60 percent penetration? And what **22** 

### would happen if we looked at a tax credit that

### Page 252

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 looked sort of like that? 2 DOE has put together some**  **3 information in the past that showed that there 4 is about an 80-percent -- that a tax credit**  **5 would achieve about 80 percent of what a rebate 6 would achieve. So, we're looking at one**  **7 scenario with a 60-percent impact and one 8 scenario with a 48-percent impact.**  **9 So, the results from that, after 10 putting those inputs into the model, we found**  **11 about a 52 percent, that a tax credit would 12 save about 52 percent of what the standards**  **13 would actually save, and a rebate program 14 would save about 64 percent of what the**  **15 standard would save. And, of course, the NPV 16 is also reduced somewhat from the standard**  **17 level as well. 18 There is one caveat here, and that is**  **19 that, as I think we have heard a number of times 20 before today, there aren't too many machines**  **21 that actually would qualify for this ENERGY 22 STAR. So, this would be a significant moving** 

### Page 253

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### of the market in a voluntary fashion. **2** 

### Yes? **3** 

### MR. BROOKMAN: Yes, Laura? **4** 

### MS. PETRILLO-GROH: So, DOE is **5** 

### required to look at these options, is that **6** 

### correct? **7** 

### MR. COOKE: Yes. **8** 

### MR. RAWALD: Has DOE ever gone with **9** 

### one of these options? **10** 

### MR. BROOKMAN: John Cymbalsky? **11** 

### MR. CYMBALSKY: So, I think what all **12** 

### of our rules have said is that this standard **13** 

### is the most cost-effective way at achieving **14** 

### the level of energy savings that you see in the **15** 

### rulemaking. **16** 

### MS. PETRILLO-GROH: So no? **17** 

### MR. CYMBALSKY: I think that's **18** 

### correct. **19** 

### MR. BROOKMAN: Thanks, Alan. **20** 

### Comments on the Regulatory Impact **21** 

### Analysis results? **22** 

### MR. DELASKI: Just to be clear, DOE

### Page 254

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 can't give out tax rebates or write tax law. 2 MR. BROOKMAN: Thank you, Andrew.**  **3 I thought that was, yes, an important point. 4 MS. PETRILLO-GROH: Thank you. I**  **5 understand that. 6 MR. BROOKMAN: Yes.**  **7 Karim? 8 DR. AMRANE: Karim Amrane, AHRI.**  **9 Actually, I have a comment for 10 following what John said about the energy**  **11 savings. You said .3 or .286 quads, right, 12 over 30 years?**  **13 I think, by statute, DOE is required 14 to show that the standard saves a significant**  **15 amount of energy. And so, is .28 quads over 16 30 years a significant amount of energy?**  **17 MR. CYMBALSKY: Yes. We have 18 determined previously that .001, I believe, or**  **19 .01 was significant. 20 DR. AMRANE: So, .1 is?**  **21 MR. CYMBALSKY: Yes. I think the 22 PTACs rule is the standard bearer.** 

### Page 255

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### MR. BROOKMAN: Would you spell that **2** 

### out? PTACs means? **3** 

### MR. CYMBALSKY: Package Terminal **4** 

### Air Conditioners had a .01, and that was deemed **5** 

### significant. **6** 

### DR. AMRANE: And where is it treated **7** 

### somewhere? It's in the rule? It's in **8** 

### statute? Or where is it? It is a DOE -- **9** 

### MR. CYMBALSKY: I think that is in **10** 

### the preamble of that rule, yes. Before my **11** 

### time. **12** 

### MR. DELASKI: I think the guiding **13** 

### force is NRDC v. Harrington. **14** 

### MR. CYMBALSKY: Yes. **15** 

### MR. DELASKI: So, the lawsuit was **16** 

### NRDC v. Harrington. **17** 

### DR. AMRANE: Okay. And it was the **18** 

### .00 -- **19** 

### MR. DELASKI: No, no. **20** 

### DR. AMRANE: No? **21** 

### MR. DELASKI: It goes back to the **22** 

### 1980s. There were a number of standards that

### Page 256

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### were set where DOE determined there shall be **2** 

### no standard. The Department was sued by NRDC. **3** 

### And the result was all of the standards program **4** 

### we have today in large measure. **5** 

### So, the Department doesn't have much **6** 

### latitude to say, you know, it's insignificant. **7** 

### So, what is significant was termed to be **8** 

### non-trivial, was what was determined. **9** 

### MR. BROOKMAN: Thank you, Andrew, **10** 

### for that bit of history. Thank you. **11** 

### Okay. We're moving on to MIA. **12** 

### MR. DELASKI: Doug, before we move **13** 

### on -- **14** 

### MR. BROOKMAN: Yes, Andrew, please. **15** 

### MR. DELASKI: -- I want to come back **16** 

### to, because I am just struggling with that **17** 

### inconsistency that I have heard a few times **18** 

### today. And maybe the manufacturers can help **19** 

### me with this. **20** 

### I come back. I am looking at Daryl **21** 

### just because you have talked about it today. **22** 

### I am going to put it back on you.

### Page 257

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### (Laughter.) **2** 

### You seem to have some -- any of you **3** 

### guys could probably answer this. **4** 

### If you pop back to slide 74, this is **5** 

### a slide that says, is the market share by **6** 

### efficiency level? And, of course, this **7** 

### affects the analysis in a lot of different ways **8** 

### because it is the baseline picture here, a **9** 

### snapshot of the picture. You're getting a **10** 

### response to this when you put it up, which was **11** 

### striking to me, because earlier I thought I **12** 

### heard folks say, you know, you just can't get **13** 

### machines at these efficiency levels that are **14** 

### being considered for the rule. But, yet, this **15** 

### says that you can. Not only can you get them, **16** 

### but they have significant market share in some **17** 

### of the categories. **18** 

### So, I am struggling with this **19** 

### disconnect. Either the slide isn't correct **20** 

### or else, you know, there is substantial market **21** 

### share out there at the efficiency levels being **22** 

### considered.

### Page 258

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 MR. COOKE: Well, I'm not sure that 2 I can tell you if this slide is correct in terms**  **3 of market share. What this tells you is that, 4 for example, ice-making, water-cooled, small**  **5 batch, 10 percent of the machines for sale in 6 the database that we compiled are at that**  **7 efficiency level. 8 MR. DELASKI: Okay.**  **9 MR. COOKE: But we don't know what 10 the shipments at that efficiency level are.**  **11 MR. DELASKI: So, this says market 12 share. What it shows us is available models?**  **13 MR. COOKE: It's available models, 14 but we don't have market share by efficiency**  **15 level. So, we have used available models. 16 I'm assuming that, if you manufacture a model,**  **17 it's because you think there's a market for it. 18 So, the market share and the available models**  **19 were used interchangeably here. 20 MR. BROOKMAN: Chris?**  **21 MR. SALATINO: Chris Salatino, 22 Scotsman.** 

### Page 259

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 My interpretation of this is this is 2 strictly efficiency level, not TSL level.**  **3 MR. COOKE: This is strictly 4 efficiency level. Correct. So, you do have**  **5 to be a little careful about doing the mapping 6 in your mind to get that TSL3.**  **7 MR. BROOKMAN: John Cymbalsky? 8 MR. CYMBALSKY: So, just as an**  **9 example, jumping ahead, if you look on slide 10 109, maybe this is a good place to do this, if**  **11 everyone could -- no, no, Alan, you keep yours 12 where it is.**  **13 MR. COOKE: Okay. 14 MR. CYMBALSKY: And then, everyone**  **15 else go to slide 109. I think you could look 16 at the gold line going down, and maybe this**  **17 helps Andrew's point to make, that again 18 you've got to mix and match. TSL3 doesn't**  **19 mean Level 3 necessarily. It does for some, 20 but not for all.**  **21 So, for example, the second line up 22 there, 11.9, so IMHW medium B, 12 percent of** 

### Page 260

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### the available models are what we are proposing **2** 

### to have the standard at. And then, you could **3** 

### just keep going down the list. **4** 

### So, to the extent that manufacturers **5** 

### want to comment on that -- Andrew is right, **6** 

### this is a key slide for us because it also **7** 

### determines the energy savings as well. **8** 

### MR. BROOKMAN: George? **9** 

### MR. PARSONS: George Parsons, **10** 

### Ice-O-Matic. **11** 

### But the other point could be to **12** 

### exactly what you're saying, John. It's 12 **13** 

### percent of the models available meet that **14** 

### standard. **15** 

### Around this table, we haven't looked **16** 

### at it. Whoever has those models may have **17** 

### shipped one this year, and that may be it. **18** 

### MR. CYMBALSKY: That's right. I **19** 

### think that is the point Alan was trying to **20** 

### make, that we don't have the shipment data. **21** 

### It was not provided to us and we cannot get it. **22** 

### But the best we can do is to look

### Page 261

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 through the catalogs and the offerings and the 2 AHRI database, all those places we look. And**  **3 the best we can do is to use this as a proxy 4 for what efficiency distribution is because it**  **5 is the best we have. 6 And if AHRI or manufacturers can**  **7 provide us the shipment data, you know, that's 8 the Holy Grail for the analysis. So, we are**  **9 more than happy to take that. 10 MR. BROOKMAN: Daryl? Then, to**  **11 Frank and, then, to Karim. 12 MR. ERBS: So, Daryl Erbs, Manitowoc**  **13 Ice. 14 I haven't had the time to sort**  **15 through this, but I think a key point to keep 16 in mind is, when you look at any of our range**  **17 of model offerings across a particular cabinet 18 size, because, again, we're low volume, we can**  **19 only afford to tool up a limited number of 20 discrete sizes.**  **21 There are always models that happen 22 to be the smallest-capacity model, after we** 

### Page 262

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 jump to the next bigger cabinet size that we 2 need to, that end up looking really good, very**  **3 high efficiency because it is a small output 4 relative to that cabinet size that was**  **5 selected to run across many different capacity 6 increments.**  **7 And so, when you look at this, you 8 say, well, gee, there are some that are very**  **9 high efficiency, and that's true. But when 10 you have to deal with a new standard, every one**  **11 of them has to get to that level, and we can't 12 afford to go from having three or four cabinets**  **13 to 15 or 20 to give us just the right cabinet 14 size for every model to meet the efficiency.**  **15 So, just because there are some 16 doesn't mean that it is really we're ready to**  **17 go today to meet those efficiency levels. It 18 is we have to get 100 percent of them up to that**  **19 level, and I think that is where it becomes 20 difficult for us.**  **21 We will end up, after we deal with 22 whatever the final efficiency levels are, with** 

### Page 263

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### some that exceed those efficiency levels for **2** 

### that very same reason. **3** 

### MR. COOKE: Right. **4** 

### MR. MOORE: So, I was going to ask, **5** 

### John, do you all have -- or, Alan -- because **6** 

### it sounds like Table 74 and Table 109 are kind **7** 

### of key. We kind of really want to hunker-down **8** 

### on those. Do you have the model numbers? **9** 

### MR. COOKE: We have the database. **10** 

### MR. MOORE: The model numbers? I **11** 

### mean, they are discrete models, and that seems **12** 

### to be -- **13** 

### MR. COOKE: That's right. The **14** 

### model numbers are in the database, but -- **15** 

### MR. MOORE: I mean, maybe model **16** 

### number is not right. I mean, do you have the **17** 

### machine that went into that number? **18** 

### Because, to Daryl's point, that **19** 

### might have been shipped once. We could see. **20** 

### If we see the machine, we can tell you if it **21** 

### was shipped once; somebody could. **22** 

### I mean, if the data went in, where is

### Page 264

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 the data? We do want to see that. I mean, 2 because these are important things.**  **3 MR. CYMBALSKY: Right. So, I 4 assume that, like the AHRI database has the**  **5 basic model numbers. The CCMS that is 6 reported to the Department --**  **7 MR. BROOKMAN: Karim, microphone, 8 please. Thank you.**  **9 DR. AMRANE: So, the information is 10 on the chart.**  **11 MR. CYMBALSKY: Let me correct that, 12 actually.**  **13 DR. AMRANE: Ah, you're right. 14 MR. CYMBALSKY: The AHRI database is**  **15 reflecting ice makers since last summer. 16 DR. AMRANE: Ice makers. I'm**  **17 sorry. Yes. 18 MR. CYMBALSKY: That's right.**  **19 DR. AMRANE: We are 20 submitting -- you're right. That's correct.**  **21 MR. BROOKMAN: Thank you. Thank 22 you, Doug.** 

### Page 265

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 Andrew? 2 MR. RAWALD: A small question. So,**  **3 what's the vintage of the data that went into 4 this?**  **5 MR. COOKE: I think we drove a stake 6 in the sand at about the end of 2012 and said**  **7 this is the database that we are moving forward 8 with.**  **9 And one thing, while I have the 10 microphone -- this is Alan Cooke -- one thing**  **11 that I might add here, this is available units. 12 And in some product classes, that is a lot of**  **13 units, and in some product classes, what looks 14 like a big number here, 12, 10.9 or 12 percent,**  **15 might actually be one unit out of five or six. 16 MR. PARSONS: Yes. George Parsons.**  **17 I would agree with you, and I know for 18 ourselves we could go to each one of those**  **19 subdivisions and what models numbers of ours 20 apply, and we could look at shipments in each**  **21 one of those classes. 22 Because it is exactly what Daryl is** 

### Page 266

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### talking about. We might have one point where **2** 

### this one hits, but it is either right at the **3** 

### beginning or right at the end. It's in a box **4** 

### that it's right here. But, then, as you go **5** 

### down the family, they change. **6** 

### And it may be in a place where it is **7** 

### low shipments. It could be high shipments. **8** 

### But, I mean, that distribution is out there. **9** 

### MR. CYMBALSKY: John Cymbalsky **10** 

### again. **11** 

### And so, that's great. I mean, **12** 

### that's the exact -- that's the data that helps **13** 

### the analysis become more rich in its outcome. **14** 

### And so, absent that data, what the Department **15** 

### is saying is, absent that, this is what we **16** 

### have. And if you think it's wrong and you have **17** 

### data to back up or fill this in better and more **18** 

### accurately reflect the shipments, we want that **19** 

### data. I mean, that's exactly what we need to **20** 

### get this to be a more rich standard. **21** 

### MR. BROOKMAN: Thank you, John. **22** 

### Now to Karim.

### Page 267

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 DR. AMRANE: Karim. I'm with AHRI. 2 But I thought -- and maybe it has been**  **3 a long time ago -- but I thought that we 4 provided this data to you. Did we?**  **5 MR. COOKE: You provided data that 6 was based on a number of different sized bins.**  **7 DR. AMRANE: Yes. 8 MR. COOKE: And we also got ENERGY**  **9 STAR or non-ENERGY STAR. So, basically, we 10 could see that the split between Level 1 and**  **11 Level 2 and above, more or less, on average, 12 looks about like what you gave us, but we**  **13 didn't actually get the bins across. 14 MR. BROOKMAN: Okay. So, this is a**  **15 lot of data. Any additional questions, 16 clarifications here?**  **17 Louis? 18 MR. STARR: So, this is Louis Starr**  **19 with NEEA. 20 Another thought is that, since this**  **21 is the 2012 data, there's ENERGY STAR 22 information that is now available, and it** 

### Page 268

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### actually might bump those levels up to higher **2** 

### numbers potentially? In other words, the **3** 

### levels would move to the right? **4** 

### MR. COOKE: I don't recall right off **5** 

### the top of my head. ENERGY STAR, I have **6** 

### recently been looking at ENERGY STAR data, and **7** 

### it has been fairly consistent. And I don't **8** 

### remember if 2012 was higher or lower than 2011, **9** 

### but it has been right in that same range. **10** 

### MR. STARR: Well, my point more is **11** 

### this is AHRI data, right? And then ENERGY **12** 

### STAR -- **13** 

### MR. COOKE: Right. **14** 

### MR. STARR: -- we think would be at **15** 

### a higher level? **16** 

### MR. COOKE: But, even going back to **17** 

### 2010, what I just said is true. Looking at **18** 

### 2010 through 2012, it's like 60, 62, 67, and **19** 

### I don't remember which years were which. So, **20** 

### it might move it a little bit farther. But, **21** 

### right off the top of my head, I can't verify **22** 

### that.

### Page 269

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### MR. BROOKMAN: Question, please. **2** 

### MR. RANEY: Craig Raney with Emerson **3** 

### Climate Technologies. **4** 

### Looking at slide 72 -- I'm going to **5** 

### change just for a second -- that was the number **6** 

### of shipments. And the year 2020, your **7** 

### estimate is the number of shipments will go **8** 

### down. Why is that? **9** 

### MR. COOKE: We benchmarked the start **10** 

### of our model with about 10 years' worth of **11** 

### actual shipments from AHRI. So, if you look **12** 

### at where the peaks and the troughs were, and **13** 

### start to extend those out to the expiration of **14** 

### the equipment that was sold in 2008-2009, that **15** 

### explains part of that trough. **16** 

### There is also ups and downs built **17** 

### into the AEO 2013 forecast. It isn't just a **18** 

### line that goes upwards. It goes up and down. **19** 

### So, it is probably a combination of **20** 

### a trough playing itself out and, also, a **21** 

### downward year or two in the AEO 2013 forecast. **22** 

### MR. RANEY: So, there is some

### Page 270

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### acknowledgment that there's going to be some **2** 

### decline in demand, based off of the energy **3** 

### efficiency minimum standards that are put in **4** 

### place? **5** 

### MR. COOKE: That's not included in **6** 

### these numbers, no. **7** 

### MR. RANEY: So, what accounts for **8** 

### the 2020 drop? **9** 

### MR. COOKE: It's replacing units **10** 

### from a year that were lower than average. It **11** 

### is kind of a trough year in the historical **12** 

### data. **13** 

### MR. RANEY: Okay. **14** 

### MR. COOKE: And, also, probably a **15** 

### down year in the energy outlook projection of **16** 

### floorspace. **17** 

### MR. CYMBALSKY: So, this is John **18** 

### Cymbalsky. **19** 

### Just eyeballing the 2020 number, it **20** 

### looks to be even with the 2018 for the new **21** 

### construction. So, that bar, in particular, **22** 

### is picking up a historical trend in shipments

### Page 271

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 where you probably had a series of recession 2 years. And when you map that three- or**  **3 five-year period out 10 years, when they are 4 all going to be replaced, they're not there**  **5 anymore. So, you're going to have this 6 natural pattern of shipments in the**  **7 replacement market. 8 MR. COOKE: That's correct.**  **9 MR. CYMBALSKY: Matching the 10 replacement rate, yes.**  **11 MR. RANEY: I would say it has just 12 been our experience every time a different**  **13 efficiency level comes into place you see a 14 ramp-up right before that of customers**  **15 stocking up, whether it was the 13 SEER or 16 other things. And you see this wild swing,**  **17 and it puts the manufacturers through quite a 18 bit of hassle with inventories and other**  **19 issues. 20 MR. CYMBALSKY: Yes, we would prefer**  **21 you not to do that, but -- 22 MR. RANEY: Well, it's not us. It's** 

### Page 272

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### the demand that drives that. **2** 

### MR. CYMBALSKY: I understand. I **3** 

### understand the reason why it is done. **4** 

### MR. BROOKMAN: Okay. Thank you, **5** 

### John. **6** 

### Where are we now? **7** 

### MR. COOKE: We are up to the MIA. **8** 

### MR. BROOKMAN: Okay. Let's go to **9** 

### the MIA. **10** 

### Or should we take a break right here? **11** 

### Just keep going. Okay. **12** 

### MR. BARRINGTON: Thanks, Alan. **13** 

### My name is Ben Barrington. I'm with **14** 

### Navigant Consulting. I helped pull together **15** 

### the Manufacturer Impact Analysis to inform **16** 

### today's proposed standard levels. **17** 

### As this chart illustrates, the **18** 

### Manufacturer Impact Analysis is downstream of **19** 

### several of the other analyses that we **20** 

### discussed today. Specifically, we pulled **21** 

### from the engineering analysis. The cost **22** 

### efficiency curves are primary inputs to us, as

### Page 273

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 are the numbers from the shipments analysis. 2 The purpose of the Manufacturer**  **3 Impact Analysis is to fill several of the 4 criteria for the statutory requirements put**  **5 forth by EPCA in terms of economic 6 justification for a proposed standard.**  **7 Specifically, this is to assess the 8 impact of standards on manufacturers, and we**  **9 do so both quantitatively and qualitatively. 10 Additionally, we identify several subgroups,**  **11 well, any present subgroups of manufacturers 12 that merit specific analysis in terms of**  **13 disproportionate impacts that that part of the 14 market might experience.**  **15 Additionally, we look at the impacts 16 on direct employment, competition,**  **17 manufacturing capacity, and cumulative 18 regulatory burden, several of which I think**  **19 several people who have commented earlier 20 today have alluded to, resulting from this**  **21 particular rulemaking. 22 The way we go about doing this, as I** 

### Page 274

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 mentioned, it is downstream analysis. So, we 2 pull from both the engineering analysis and**  **3 shipments analysis, but we also develop 4 several critical inputs on our own,**  **5 specifically, consulting with 6 publicly-available financial information, as**  **7 pulled from annual reports from the SEC on 8 publicly-traded manufacturers. And then, we**  **9 also conduct interviews with manufacturers 10 under a non-disclosure agreement and**  **11 aggregate the responses from those in refining 12 our inputs for the analysis.**  **13 Just a brief overview of some of how 14 this all times out. Phase 1 of our analysis**  **15 starts with an industry profile that builds 16 upon information pulled together for the**  **17 market and tech analysis, which Detlef spoke 18 to earlier today.**  **19 Phase 2 largely aligns with our 20 pre-NOPR phase of the rulemaking. In that, we**  **21 develop a strawman GRIM, which is the 22 Government Regulatory Impact Model. It's a** 

### Page 275

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 discounted cashflow model that we use to 2 assess the impact to the industry.**  **3 We also at that point in time take the 4 information that we have from the industry**  **5 profile and fold that into an interview guide 6 that we, then, take to manufacturers, willing**  **7 participants in this interview process. 8 And in Phase 3 we take that**  **9 information, aggregate it, so as to not 10 disclose any proprietary or confidential**  **11 information that manufacturers shared with 12 us, and integrate that with our Government**  **13 Regulatory Impact Model and some other 14 discrete analyses that we perform, and then,**  **15 basically, report back on that. And those are 16 the results that I will share with you today.**  **17 With regards to the interviews that 18 we conduct, we do feel it is important to share**  **19 some of the key takeaways. 20 We open every interview with asking**  **21 manufacturers what are the key issues facing 22 them as a result of this particular** 

### Page 276

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 rulemaking. And I'll just reiterate some of 2 the aggregate points that came about in light**  **3 of those interviews. I think several of these 4 have been spoken to earlier today. But if**  **5 there's anything people would like to add, 6 we're happy to take those comments as well.**  **7 First and foremost, manufacturers 8 characterize the market for automatic**  **9 commercial ice makers as being extremely 10 price-sensitive. And in light of those**  **11 comments, we did perform an analysis of retail 12 price assessment and performed a regression**  **13 analysis with the efficiency of those 14 products, correcting for a variety of other**  **15 product attributes, including size, ENERGY 16 STAR rating, and other features that we could**  **17 glean from the database. 18 The long and short of this, though,**  **19 is that manufacturers posited that there were 20 several other key features that drove consumer**  **21 decisions or purchasing decisions with regard 22 to this equipment that took higher precedence** 

### Page 277

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### over the product efficiency. **2** 

### Secondly, there were some concerns **3** 

### expressed over enforcement of a standard, were **4** 

### that to be put in place. Manufacturers noted **5** 

### that several new entrants from foreign **6** 

### competition have entered the market as of **7** 

### recent, and there is some skepticism or **8** 

### concern that some of those products might not **9** 

### be compliant with existing standards. And **10** 

### so, going forward, they asserted that it would **11** 

### be critically important that enforcement was **12** 

### swift. **13** 

### One comment? **14** 

### MR. RAWALD: If I could jump in here? **15** 

### This is Doug Rawald from the Department of **16** 

### Energy. **17** 

### So, enforcement is kind of my area. **18** 

### So, folks should know, just as of last summer, **19** 

### the CBP issued a rule giving a lot of strength **20** 

### to our ability to keep out foreign imports that **21** 

### are non-compliant with our standards. **22** 

### I mean, we have this complaint across

### Page 278

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### the board from all manufacturers. It is not **2** 

### a unique concern about, hey, folks are **3** 

### importing things; they are going to import **4** 

### things that are not compliant, and we are **5** 

### trying to comply here domestically. **6** 

### And so, what this rule allows us to **7** 

### do is to notify CBP, "Hey, we are aware of this **8** 

### product coming in. Don't allow it in. It's **9** 

### not going to comply with the standards." **10** 

### So, we have a number of things that **11** 

### we do enforcement-wise, from testing and **12** 

### verifying what the actual energy efficiency of **13** 

### products is, and we use that in conjunction **14** 

### with the Customs and Border Protection to stop **15** 

### those things from coming in. So, the **16** 

### manufacturers should understand that this is **17** 

### something that we are doing and we are taking **18** 

### very seriously. **19** 

### MR. BROOKMAN: Okay, Doug. Thank **20** 

### you. **21** 

### Yes, Scott? **22** 

### MR. BINGHAM: Scott Bingham at

### Page 279

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 Follett. 2 Kind of a sister issue to this that**  **3 Scott has alluded to earlier, but as we ship 4 products outside the United States, there is**  **5 the impact of a higher-cost product competing 6 against units made overseas and sold overseas.**  **7 Was that taken into, potential reduced sales, 8 was that taken into account in this impact on**  **9 manufacturers? 10 MR. RAWALD: This is Doug Rawald**  **11 again. 12 So, the Department does not**  **13 regulate -- 14 MR. BINGHAM: I understand that.**  **15 MR. RAWALD: -- products that are 16 manufactured for sale overseas.**  **17 MR. BINGHAM: I understand that. 18 It's --**  **19 MR. RAWALD: It's a question of 20 maintaining two product lines?**  **21 MR. BINGHAM: It is a mirror-image 22 question to this that doesn't speak to** 

### Page 280

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### enforcement. It is just impact on **2** 

### manufacturers. **3** 

### MR. RAWALD: Right. So, there is **4** 

### nothing preventing you from continuing to **5** 

### manufacture things, as long as market properly **6** 

### and still sell it overseas. You don't have to **7** 

### discontinue the line as long as you're going **8** 

### to keep selling it overseas. **9** 

### MR. BINGHAM: Right. Again, this **10** 

### is Scott Bingham. **11** 

### But, again, we would likely not make **12** 

### a separate model. And so, we will lose sales **13** 

### at an increased product cost, either lose **14** 

### margin or lose sales, if we pass that cost on. **15** 

### So, was that impact figured into the **16** 

### analysis, is the question. **17** 

### MR. BARRINGTON: So, for the **18** 

### purposes of this analysis where we are looking **19** 

### at the impact on standards for products that **20** 

### are sold into the U.S. market, no, that was not **21** 

### taken into account. **22** 

### Okay. I think we just have one more

### Page 281

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### key issue that was brought up in interviews, **2** 

### that being the impact -- oh, no, wait. You **3** 

### know what? I skipped over one. Sorry. **4** 

### Okay, we have two more. **5** 

### So, the impact on reliability, much **6** 

### along the lines of price sensitivity and **7** 

### noting that consumers wouldn't be willing to **8** 

### pay for a more efficient product, despite a **9** 

### very short payback period. **10** 

### Manufacturers also noted that **11** 

### reliability was really a paramount issue and **12** 

### concern to their consumers, making sure that **13** 

### the products that they install on their **14** 

### premises are operating 24/7 and can produce **15** 

### ice on demand. **16** 

### Further, along those lines, **17** 

### manufacturers also noted an impact on **18** 

### innovation outside of the scope of improving **19** 

### energy efficiency. So that, given the **20** 

### limited resources as it relates to product **21** 

### development and research, that those limited **22** 

### human and capital resources would be diverted

### Page 282

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 away from creating other product innovation 2 during the timeframe in which they would be**  **3 working to produce compliant products. 4 MR. BROOKMAN: Laura?**  **5 MS. PETRILLO-GROH: Laura Petrillo, 6 AHRI.**  **7 Just out of curiosity, when were 8 these surveys taken?**  **9 MR. BARRINGTON: If I recall, a lot 10 of these interviews were conducted following**  **11 the preliminary analysis public meeting, 12 which I believe was in February of 2012. So,**  **13 I think the vast majority of our interviews 14 were conducted throughout the summer of 2012.**  **15 MS. PETRILLO-GROH: So, if the key 16 issues have shifted somewhat, I expect we can**  **17 write that in our comments. 18 MR. BARRINGTON: Yes, absolutely.**  **19 MS. PETRILLO-GROH: From what we 20 heard today, those are maybe not the most**  **21 pressing of concerns. 22 MR. BROOKMAN: So, Laura, that would** 

### Page 283

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 be helpful if the issues have shifted, yes, to 2 write that out.**  **3 MS. PETRILLO-GROH: Such as 4 refrigerants and, you know, the analysis**  **5 being -- 6 MR. BROOKMAN: Okay.**  **7 MS. PETRILLO-GROH: And the size 8 issues.**  **9 MR. BROOKMAN: John Cymbalsky? 10 MR. CYMBALSKY: So, again, with the**  **11 refrigerants, again, you're free to comment on 12 what you want, but I can assure you that the**  **13 Department and the Administration, in 14 particular, understand the refrigerant issue.**  **15 This analysis stands alone with or without the 16 refrigerants issue.**  **17 We have pointed to the fact that, if 18 there is an issue, the final rule will contain**  **19 language in the preamble consistent with what 20 we wrote for the commercial refrigeration**  **21 equipment, whereby manufacturers will be able 22 to apply for relief based on the fact that the** 

### Page 284

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### refrigerant cannot -- if it is the case that **2** 

### it cannot achieve these efficiency levels, **3** 

### they can get relief from the standard. **4** 

### And so, in my mind, I know it's an **5** 

### issue. We don't know what is going to come out **6** 

### in EPA's rule. But, again, this rule is not **7** 

### about refrigerants. It's about the **8** 

### efficiency levels. **9** 

### MR. BROOKMAN: Karim? **10** 

### DR. AMRANE: Karim Amrane with AHRI. **11** 

### But this is not an OHA issue. And **12** 

### that's why we feel it's very important that the **13** 

### Department of Energy make an effort to look at **14** 

### refrigerants, because all your analysis, all **15** 

### your cost/benefit analysis is based on current **16** 

### refrigerant that might not exist three years **17** 

### from now. And you are extrapolating all the **18** 

### savings over 30 years as if nothing will **19** 

### happen. And we know things are going to **20** 

### happen. **21** 

### So, I understand you are not in an **22** 

### easy situation here, and I understand what is

### Page 285

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### going on with the EPA. But, at the same time, **2** 

### I think you should make an effort at least to **3** 

### look at the current refrigerant, to look at **4** 

### what can be done with our current refrigerant, **5** 

### and to try at least to balance a little bit the **6** 

### analysis based on that. **7** 

### MR. BROOKMAN: John? **8** 

### MR. CYMBALSKY: So, you said that **9** 

### you know what's going to happen. Can you **10** 

### please enlighten the room, since you said you **11** 

### know what's going to happen with the **12** 

### refrigerants? **13** 

### DR. AMRANE: Well, EPA has announced **14** 

### that they are going to be delisting some of the **15** 

### refrigerant from SNAP, and it has been **16** 

### announced officially by EPA. They are doing **17** 

### a rulemaking, that we know by the summer we **18** 

### will have something. **19** 

### MR. CYMBALSKY: So, they have stated **20** 

### that they're delisting the refrigerants that **21** 

### these products use? **22** 

### DR. AMRANE: They might.

### Page 286

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### MR. CYMBALSKY: They might? Oh, I **2** 

### thought you said you knew what was going to **3** 

### happen. Okay. **4** 

### DR. AMRANE: We are now talking **5** 

### about R44A, which is a refrigerant used in **6** 

### commercial refrigeration in ice makers. We **7** 

### know that. **8** 

### MR. BROOKMAN: Daryl? **9** 

### MR. ERBS: Daryl Erbs, Manitowoc **10** 

### Ice. **11** 

### I have a little different **12** 

### perspective. I'm not sure we know exactly **13** 

### what will happen, but probably the biggest **14** 

### concern I have is that January 1 the clock **15** 

### starts for us to re-engineer all of our ice **16** 

### machines. Maybe a year later, two years **17** 

### later, EPA finally gets around to R404A for ice **18** 

### machines. We're two years into redesigning **19** 

### our entire platform. We have to start over. **20** 

### They give us relief on the efficiency **21** 

### levels, but the fact remains that we have to **22** 

### go back to square one and re-engineer all of

### Page 287

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 those refrigeration systems to deal with 2 refrigerants. And so, no one knows what's**  **3 going to happen. 4 But I'm wondering, shouldn't you at**  **5 least be doing a sensitivity analysis that 6 says, what would happen to all of your**  **7 projections around, you know, the benefit, the 8 life-cycle cost, if, in fact, we had to do it**  **9 twice? 10 MR. CYMBALSKY: So, my**  **11 understanding is that the EPA rules should be 12 accounting for the impacts of what you just**  **13 described there, right? This rule is 14 not -- it is refrigerant-neutral. It is not**  **15 saying anything about the refrigerant. So, 16 I'm not sure how we can capture those costs.**  **17 But, again, we are sympathetic to 18 what you're saying, absolutely. We hear you.**  **19 I have coordinated with the SNAP program. 20 They are very well aware of the issue here.**  **21 I can't tell you what's going to 22 happen, and I don't know what they're going to** 

### Page 288

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 say. But I can tell you, you know, they said 2 they will have their rule out in the**  **3 summertime, and let's see what happens then. 4 It should precede anything we do here.**  **5 MR. BROOKMAN: Okay. Thank you, 6 John.**  **7 Frank? 8 MR. MOORE: Yes, Frank with NAAFEM.**  **9 I just wanted to make sure. So, the 10 potential cost, however many "mights" are**  **11 involved or whatnot, is not baked into your 12 cost impact on the manufacturers?**  **13 MR. CYMBALSKY: Not for a 14 refrigerant, right. So, this is not a**  **15 refrigerant rule. And EPA in their 16 rulemaking should take into account these**  **17 costs. 18 The Administration reviews these**  **19 rules. They are very sensitive to this; trust 20 me, we go through the review process.**  **21 MR. MOORE: I have one other 22 question.** 

### Page 289

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 Alan was speaking to you, and I have 2 bad note-taking, again, one reason I'm not an**  **3 engineer. You referenced some analysis you 4 did at the retail level. Can you help me**  **5 understand what retail means relative to this 6 sector, and how that would extrapolate into**  **7 what -- 8 MR. BARRINGTON: So, what I was**  **9 speaking to was one of the alternative 10 approaches that we looked at as part of the**  **11 engineering analysis. And I believe that 12 used the retail price data that was included**  **13 in the database that was developed as part of 14 this rulemaking and performed a price**  **15 regression analysis correcting for other 16 product features, like capacity and**  **17 throughput and other product attributes. And 18 that's the analysis that led us to the**  **19 conclusion that there was no consistent 20 relationship between the efficiency of a**  **21 product and its retail price. 22 MR. MOORE: And again, when I think** 

### Page 290

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 retail, I think me, Frank Moore, walking 2 through Home Depot. Is that --**  **3 MR. BARRINGTON: I don't know how 4 many of these are sold through Home Depot.**  **5 But, in terms of what -- no, I think the 6 distribution channel is a little bit**  **7 different, by and large, but -- 8 MR. MOORE: So --**  **9 MR. BARRINGTON: So, the sale price 10 to the end-consumer.**  **11 MR. CYMBALSKY: To the consumer. 12 So, you think of retail as Home Depot. But,**  **13 for these, the end-consumer is probably a GC 14 coming in with a truck into a restaurant and**  **15 putting it in. So, that's what I think retail 16 means here.**  **17 MR. MOORE: Well, that's what I want 18 to get clear, if, in fact, that's what you are**  **19 looking at. 20 MR. CYMBALSKY: Yes.**  **21 MR. WESTPHALEN: This is Detlef 22 Westphalen.** 

### Page 291

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 That retail analysis was based on 2 list price.**  **3 MR. BARRINGTON: Yes. List prices 4 taken from the price sheets of various**  **5 manufacturers. 6 MR. BROOKMAN: Okay.**  **7 Yes, Chris? 8 MR. SALATINO: Chris Salatino,**  **9 Scotsman Ice. 10 Just a quick comment or a question**  **11 really. John, you had mentioned that the rule 12 will be written so that it is**  **13 refrigerant-neutral. And being ignorant to 14 the process, how is that possible, given that**  **15 the entire evaluation has been based on 404A? 16 MR. CYMBALSKY: Because, in my mind,**  **17 it's the only refrigerant that's being used 18 today. That's my understanding.**  **19 MR. SALATINO: Great. So, the 20 standard that is going to be written, the**  **21 efficiency levels, then, adjust more -- how 22 will you accommodate that flexibility, should** 

### Page 292

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### refrigerants change? **2** 

### MR. CYMBALSKY: Right. So, you **3** 

### know, we have this written in the preamble of **4** 

### the CRE final rule. When I printed this, I **5** 

### thought I printed out the whole paragraph, but **6** 

### it was quick this morning. **7** 

### And I'm quoting from that. "DOE **8** 

### wishes to clarify that it will continue to **9** 

### consider CRE models meeting the definition of **10** 

### CRE to be part of the applicable covered **11** 

### equipment class, regardless of the **12** 

### refrigerant that the equipment uses. **13** 

### So, it's the definition of the **14** 

### equipment, not the refrigerant, that matters. **15** 

### If a manufacturer believes that its design is **16** 

### subjected to undue hardship by the **17** 

### regulations, in this case the refrigerant, the **18** 

### manufacturer may petition DOE's OHA for **19** 

### exemption, exception relief or exemption from **20** 

### the standard. **21** 

### So, what this had in mind was that, **22** 

### if there was a ruling where the refrigerant was

### Page 293

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### not available that we did our analysis on, and **2** 

### your testing or our testing showed that the new **3** 

### refrigerant could not meet these standards, it **4** 

### would be subject to this process to be excepted **5** 

### or exempt from the standards. **6** 

### MR. SALATINO: And I have a **7** 

### follow-up question. So, that potential **8** 

### appeal process, and then the legal fees that **9** 

### are associated with doing that potentially, is **10** 

### that included in the MIA analysis? **11** 

### MR. BARRINGTON: No. No, it's not. **12** 

### No. **13** 

### MR. BROOKMAN: Laura? **14** 

### MS. PETRILLO-GROH: So, we've heard **15** 

### going from SEER 10 AC unit to SEER 13, one of **16** 

### the problems that they faced was the increased **17** 

### coil size in the indoor unit led to, you know, **18** 

### significant increases in installation. **19** 

### That's correct, right? **20** 

### MR. BARRINGTON: Significant **21** 

### increases in the installation cost? Yes. **22** 

### MS. PETRILLO-GROH: So, one of the

### Page 294

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### design options we're looking at is an increase **2** 

### in coil size inside of a very size-constrained **3** 

### unit, the possibility of going to a **4** 

### refrigerant that has a lower heat transfer **5** 

### capability than 404A or 134A. It becomes **6** 

### problematic because you've eaten up now the **7** 

### increased coil size by gaining efficiency on **8** 

### a current refrigerant that will not be used **9** 

### within three years, and you are no longer able **10** 

### to use that potential size increase to account **11** 

### for a new, more global-warming-friendly, a **12** 

### new, more climate-friendly refrigerant. So, **13** 

### these are some of the concerns that we have **14** 

### voiced over and over again, and, really, we **15** 

### would like to see taken into account more **16** 

### because they are very real. **17** 

### Thank you. **18** 

### MR. BROOKMAN: John Cymbalsky? **19** 

### MR. CYMBALSKY: So, what's not real **20** 

### is a decision made to delist this refrigerant. **21** 

### And so, again, hopefully for the last time, DOE **22** 

### and EPA are very aware of the reliance of a

### Page 295

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 particular refrigerant type with this piece of 2 equipment. And I assure you that that**  **3 situation will be factored very heavily into 4 whatever decision EPA makes this summer, when**  **5 you get to actually see which products are 6 being delisted.**  **7 Thank you. 8 MR. BROOKMAN: Did you finish with**  **9 the key issues? Did you do impacts on 10 innovation?**  **11 MR. BARRINGTON: We did. We did 12 cover those.**  **13 MR. BROOKMAN: So, you see there the 14 four that are listed on pages, slides No. 82**  **15 and -- oops. 16 MR. BARRINGTON: Eighty-six and 87,**  **17 I believe. 18 MR. BROOKMAN: Eighty-six and 87.**  **19 MR. BARRINGTON: Yes. 20 MR. BROOKMAN: Additional comments**  **21 here, because we're about to move on? 22 Yes, Scott?** 

### Page 296

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 MR. BINGHAM: This is Scott Bingham. 2 So, if we're talking about the**  **3 magnitude of investment in R&D for compliance, 4 what's difficult to quantify but clearly an**  **5 impact is the opportunity cost of not being 6 able to innovate and develop other new**  **7 products and increase markets that can be sold 8 here and abroad. So, that is a very real**  **9 impact that needs to be taken into 10 consideration.**  **11 MR. BROOKMAN: Okay. Thank you. 12 MR. BARRINGTON: Okay. Moving on,**  **13 in terms of the methodology for analyzing the 14 impact on manufacturers, we did try to explore**  **15 a range of potential impacts as they relate to 16 a manufacturer's ability or inability to pass**  **17 through the increased incremental cost of 18 manufacturing higher-efficiency equipment.**  **19 We do so with a markup scenario, and 20 the markup within the Manufacturer Impact**  **21 Analysis context is simply the ratio of 22 manufacturer's selling price to manufacturer** 

### Page 297

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### production cost, including the materials, **2** 

### labor, overhead, and depreciation associated **3** 

### with production. **4** 

### The lower bound of impact on **5** 

### profitability is modeled by a **6** 

### preservation -- I'm sorry -- the upper bound **7** 

### of profitability, so the instance in which **8** 

### manufacturers are, in fact, able to maintain **9** 

### similar markups following amended and new **10** 

### standards for automatic commercial ice **11** 

### makers, is modeled under our preservation of **12** 

### gross margin scenario. So, we maintain the **13** 

### exact same markups before and after. **14** 

### We also modeled a scenario in which **15** 

### there are increasingly adverse impacts on **16** 

### manufacturers and explored a situation in **17** 

### which manufacturers were not able to pass **18** 

### through the entirety of the higher-cost **19** 

### equipment. And we did so by calibrating the **20** 

### markup, so that the earnings before interest **21** 

### and taxes were maintained, but not the entire **22** 

### gross margin.

### Page 298

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 And so, the effects of those two 2 scenarios play out, in that you will see that,**  **3 for each one of the cells we're reporting here 4 we will have two values, a range of impacts on**  **5 manufacturers. 6 Using the Government Regulatory**  **7 Impact Model, we estimate that the Industry 8 Net Present Value over the analysis period is**  **9 just a shade over $100 million discounted. It 10 is the discounted future cashflows using the**  **11 weighted-average cost of capital averaged 12 across the industry, on a market share basis,**  **13 I should add. 14 At the proposed trial standard**  **15 level, TSL3, we see impacts on manufacturer 16 INPV ranging from a loss of $20.9 million to**  **17 a loss of $23.9 million, which corresponds to 18 20.5 to 23.5 percent loss of Industry Net**  **19 Present Value. 20 Question?**  **21 MS. PETRILLO-GROH: What is the 22 impact on a small manufacturer?** 

### Page 299

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### MR. BARRINGTON: We will get to that **2** 

### I think in the next slide. **3** 

### MS. PETRILLO-GROH: Thank you. **4** 

### MR. BARRINGTON: As you can see, the **5** 

### conversion costs total $42.2 million, and I **6** 

### think this is something that was brought up in **7** 

### an early comment wondering about the scale of **8** 

### investments in both research and development **9** 

### and revisions, or not revisions, but changes **10** 

### to manufacturing capital and production lines **11** 

### to produce compliant equipment. **12** 

### Those costs are incurred prior to the **13** 

### effective date of the regulation. And so, **14** 

### they are spread across the three-year window **15** 

### between the announcement of a new standard and **16** 

### the compliance date. Over 90 percent of **17** 

### those, in our estimation, relate to **18** 

### investments in research and development, as **19** 

### opposed to actual changes in manufacturing **20** 

### capital. **21** 

### But we would also welcome comment on **22** 

### that. I think we solicited it in an earlier

### Page 300

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 slide, but any other comments on the magnitude 2 of research and development or potential**  **3 changes to manufacturing capital, as they are 4 such key drivers of our analysis, we always**  **5 welcome additional comment there. 6 Okay. To your question, we also**  **7 estimate the disproportionate impacts on 8 small business manufacturers of automatic**  **9 commercial ice makers. We determine which 10 manufacturers are small businesses based on**  **11 the recommended size limits from the Small 12 Business Administration. And it is based on**  **13 the North American Industry Classification 14 System Code for automatic commercial ice**  **15 makers, which I believe is 333415. It's air 16 conditioning and warm air heating equipment**  **17 and commercial and industrial refrigeration 18 equipment manufacturing.**  **19 We searched several 20 publicly-available databases, including the**  **21 SBA database, along with Hoover's, DOE's own 22 CCMS database, various trade association** 

### Page 301

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### lists from AHRI, as well as just a general **2** 

### search of this NAICS code on the Hoover's **3** 

### database, as published by Dun & Bradstreet. **4** 

### And in doing so, we identified seven domestic **5** 

### small business manufacturers of automatic **6** 

### commercial ice makers. **7** 

### MR. BROOKMAN: Seven. **8** 

### MR. BARRINGTON: Seven. **9** 

### MR. BROOKMAN: Yes, please. **10** 

### MR. DESHETLER: Scott DeShetler **11** 

### from Ice-O-Matic. **12** 

### Back to the chart for just one second **13** 

### for my clarification, so what was the **14** 

### timeframe that you estimated that Net Present **15** 

### Value? Was that five years, ten years? What **16** 

### was that? **17** 

### MR. BARRINGTON: It's the Net **18** 

### Present Value of the same analysis period for **19** 

### the other analyses. It's a 30-year analysis. **20** 

### MR. DESHETLER: Thirty-year Net **21** 

### Present Value? **22** 

### MR. BARRINGTON: Thirty-year Net

### Page 302

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 Present Value with a terminal value associated 2 with it as well.**  **3 MR. DESHETLER: And so, can we make 4 the extrapolation here that the industry**  **5 shrinks by 20 to 30 percent? 6 MR. BARRINGTON: In what capacity**  **7 shrinks? 8 MR. DESHETLER: Well, you run the**  **9 Net Present Value over 30 years at 101, and 10 then, we implement TSL No. 3. And now, the**  **11 industry is $78, $79, $80, $80 million. So, 12 can we say that the industry, therefore, has**  **13 shrunk 20 to 30 percent? 14 MR. BARRINGTON: When you say "the**  **15 industry has shrunk 20 to 30 percent," in what 16 metric?**  **17 MR. DESHETLER: In dollars. It 18 went from 101 --**  **19 MR. BARRINGTON: Yes. 20 MR. DESHETLER: -- million --**  **21 MR. BARRINGTON: In dollars, yes. 22 MR. DESHETLER: Is that correct?** 

### Page 303

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 MR. BARRINGTON: The shipments are 2 constant.**  **3 MR. DESHETLER: Okay. So, the 4 industry, if all of these assumptions, which**  **5 we obviously don't all agree on, but if all 6 these assumptions are correct, we're**  **7 anticipating the industry shrinks 20 to 30 8 percent?**  **9 MR. BARRINGTON: In terms of 10 Industry Net Present Value, yes, not in terms**  **11 of annual revenues or free cashflow. The vast 12 majority of those impacts are incurred in the**  **13 form of conversion costs, which factor in in 14 the interim period between the announcement of**  **15 the new standard and its effective date. 16 MR. CYMBALSKY: I just want to**  **17 correct. He said 20 to 30. He meant to say 18 21 to 23.5.**  **19 MR. BARRINGTON: Yes, that's 20 correct. Thank you, John.**  **21 So, back to the impact on small 22 business manufacturers, because of the size of** 

### Page 304

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### this industry and the limited number of **2** 

### products produced by small business **3** 

### manufacturers and their relative market **4** 

### share, as compared to larger competitors, we **5** 

### do anticipate there to be a disproportionate **6** 

### impact on small businesses, that being the **7** 

### expected INPV change at TSL2, which **8** 

### corresponds to the more severe set of impacts, **9** 

### is a loss of INPV of 78.6 percent for the whole **10** 

### industry. This, as I mentioned, is driven by **11** 

### lower shipment volumes relative to those same **12** 

### important investments to maintain production **13** 

### lines capable of producing compliant **14** 

### products. **15** 

### I should mention, though, that this **16** 

### estimate we believe to be overstated and **17** 

### highly conservative, following the vast **18** 

### majority of small businesses that we analyzed **19** 

### produce a variety of products outside the **20** 

### scope of this rulemaking, and the loss of INPV **21** 

### here really only relate to those products that **22** 

### are covered. A lot of small businesses

### Page 305

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 produce products that are covered under this 2 rulemaking only because of the expanded**  **3 capacity range being considered, where, 4 otherwise, the vast majority of their revenues**  **5 are derived from industrial ice-making 6 equipment not covered by this. So, I should**  **7 mention that that's not of all revenues for 8 those small businesses, but just the revenues**  **9 associated with production of covered 10 equipment.**  **11 MR. BROOKMAN: Ron? 12 MR. SOBAN: Ron Soban, Kold-Draft.**  **13 I really question these numbers. I 14 know at least two ice machine manufacturers in**  **15 here right now that are considered small 16 business, and I would guess more.**  **17 MR. BARRINGTON: As determined by 18 the SBA limit on employment?**  **19 MR. SOBAN: Yes, 750 employees. 20 MR. BARRINGTON: Okay. We would**  **21 welcome any additional information to support 22 classification or declassification of certain** 

### Page 306

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### manufacturers. **2** 

### MR. BROOKMAN: Frank? **3** 

### MR. MOORE: And you're saying -- I **4** 

### just want to make sure -- we're talking a **5** 

### universe of seven small businesses when you **6** 

### said a lot do other products? A lot of seven, **7** 

### is that what you're -- **8** 

### MR. BARRINGTON: Yes. **9** 

### MR. MOORE: Okay. **10** 

### MR. BARRINGTON: Most of seven. **11** 

### MR. BROOKMAN: Laura? **12** 

### MS. PETRILLO-GROH: So, I'm not an **13** 

### economist. So, these numbers aren't really **14** 

### as clear for me. I don't want to take up a lot **15** 

### of time with this. **16** 

### But, with 78.6 percent loss of market **17** 

### share for seven manufacturers -- **18** 

### MR. BARRINGTON: It's loss of INPV. **19** 

### MS. PETRILLO-GROH: INPV? Okay. **20** 

### MR. BARRINGTON: Yes. Sure. **21** 

### MS. PETRILLO-GROH: Is that **22** 

### acceptable? Is that comparable to other

### Page 307

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### rulemakings? It seems like a lot to me, but, **2** 

### again, I'm not an economist. **3** 

### MR. BARRINGTON: So, I can't comment **4** 

### on taking a position as to what is or what is **5** 

### not acceptable. **6** 

### MS. PETRILLO-GROH: Is the value **7** 

### like this been acceptable in other **8** 

### rulemakings? **9** 

### MR. BARRINGTON: With regards to the **10** 

### impact on small businesses, I don't know **11** 

### offhand what the range of acceptable or **12** 

### unacceptable impacts on Net Present Value have **13** 

### been. With regards to the industry at large, **14** 

### I know that's within ranges that have been **15** 

### proposed in other rules. **16** 

### MR. BROOKMAN: Karim? **17** 

### DR. AMRANE: Karim Amrane with AHRI. **18** 

### But, just by proposing TSL3, it looks **19** 

### like this is acceptable to DOE at least. **20** 

### MR. BROOKMAN: John Cymbalsky? **21** 

### MR. CYMBALSKY: So, I think that Ben **22** 

### brought up a good point about what other things

### Page 308

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 these companies may do. So, that 78 percent 2 is in relationship to this product that they**  **3 make with a portfolio of a bunch of other 4 products that are not part of this rulemaking.**  **5 So, they could lose 78 percent of 6 this commercial ice maker, what they make for**  **7 this standard, and then, 80 percent of their 8 business could be other stuff that's not**  **9 impacted here. So, we should be a little bit 10 careful about that.**  **11 However, yes, this is our proposal 12 that has been through interagency review with**  **13 the SBA. 14 MR. BROOKMAN: Okay. Yes, George.**  **15 MR. PARSONS: George Parsons, 16 Ice-O-Matic.**  **17 I'm just astounded that in the world 18 we live in today that that kind of economic**  **19 impact is acceptable. But, that being said, 20 the other thing that doesn't go into this is,**  **21 if we make a decision as a manufacturer to 22 aggressively go after this, to the point he** 

### Page 309

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 made earlier, we've got to make a decision as 2 to whether we try to still compete globally**  **3 with multiple product lines. 4 I will guarantee you all, as small**  **5 businesses, we can't afford that. We can't 6 afford designs just to sell in North America,**  **7 designs to sell globally. So, the economic 8 impact will be greater than this because we**  **9 will lose global business. Frankly, our 10 friends in Asia will take it all. I mean, I**  **11 am just absolutely astounded by these numbers. 12 MR. MOORE: Just for the record, I**  **13 think I did hear that, in fact, DOE in its 14 economic analysis did not include the lost**  **15 sales overseas and it simply determined that 16 it's not responsible for that.**  **17 And one option for you, Daryl, is to 18 have two business models. And that cost is**  **19 also not included in the economic analysis. 20 Is that what I understood?**  **21 MR. BROOKMAN: Frank, that was Frank 22 speaking.** 

### Page 310

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### MR. CYMBALSKY: I lost my train of **2** 

### thought because I was thinking of something **3** 

### else. **4** 

### So, what I would like, if you could **5** 

### provide, if it is under an NDA, that's great, **6** 

### too. It would be nice to know how much product **7** 

### is exported versus sold domestically to help **8** 

### an analysis. So, I don't know if we have those **9** 

### numbers. **10** 

### MR. BROOKMAN: Laura? **11** 

### MS. PETRILLO-GROH: I know we **12** 

### mentioned PTACs earlier. And one of the **13** 

### reasons I raised the question in the first **14** 

### place was that, you know, for one of the **15** 

### previous rulemakings for PTACs, the **16** 

### acceptable life-cycle cost analysis was more **17** 

### than the lifetime of the equipment. It was 11 **18** 

### years versus 10 years for the lifetime. **19** 

### And now, there are very few **20** 

### manufacturers making PTACs domestically. In **21** 

### fact, they were all driven to Asia. So, the **22** 

### sort of situation has happened, and there was

### Page 311

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### a very real impact of it. **2** 

### MR. BROOKMAN: So, those sorts of **3** 

### comments would be helpful, I think, to the **4** 

### Department. **5** 

### George? **6** 

### MR. PARSONS: George Parsons, **7** 

### Ice-O-Matic. **8** 

### I would challenge you to find one **9** 

### PTACs manufacturer left in the United States. **10** 

### How much of the market do they serve? A very **11** 

### small portion. **12** 

### MR. BROOKMAN: You can see on slide **13** 

### 92, the next slide, request for comment. It **14** 

### may be that we have covered the majority of **15** 

### this already. **16** 

### Magnitude of potential impacts of **17** 

### amended standards on small businesses. **18** 

### Estimated capital and equipment **19** 

### conversion costs. **20** 

### Estimated shipments of automatic **21** 

### commercial ice makers produced by small **22** 

### business manufacturers.

### Page 312

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 Any additional comments on these? 2 Karim?**  **3 DR. AMRANE: Karim Amrane, AHRI. 4 I would like to ask a question to DOE.**  **5 Those reviews by the Small Business 6 Administration, are they available for the**  **7 public to look at in the docket? 8 MR. BROOKMAN: John Cymbalsky?**  **9 MR. CYMBALSKY: So, I think what we 10 post on our website is the version of the**  **11 proposal that we drafted and the 12 tracked-change version of what comes out of**  **13 administrative review. 14 So, you could see what those changes**  **15 were. I can't say off the top of my head if 16 they are attributed to small business or**  **17 whoever, but you could see what changes were 18 made, yes.**  **19 MR. BROOKMAN: Let's move on to the 20 next slide.**  **21 MR. BARRINGTON: Okay. So, as 22 outlined earlier, in the engineering analysis** 

### Page 313

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### a lot of the design options considered at TSL3 **2** 

### relate to component swaps. And so, in our **3** 

### modeling of the impact on domestic production **4** 

### employment, we don't see a substantial **5** 

### departure from current employment levels **6** 

### resulting from these energy conservation **7** 

### standards. **8** 

### (Laughter.) **9** 

### We do request comment on that **10** 

### estimate. **11** 

### MR. PARSONS: I apologize. How do **12** 

### you show a market dropping by that much in Net **13** 

### Present Value and not have a loss of **14** 

### employment? Because the owners of these **15** 

### companies can't afford to build the **16** 

### product -- they are not going to do it for less **17** 

### profit than they're doing today. So, if the **18** 

### market loses Net Present Value, they're not **19** 

### going to accept less profit. There is no way **20** 

### they can employ the same number of people **21** 

### unless they pay them a lot less. That's basic **22** 

### economics 101.

### Page 314

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### MR. BROOKMAN: Thank you, George. **2** 

### I thought I saw another -- Scott? **3** 

### MR. DESHETLER: George articulated **4** 

### my position quite well. That mathematics **5** 

### just doesn't work. **6** 

### MR. BROOKMAN: Thank you. **7** 

### Frank? **8** 

### MR. MOORE: But do you have some **9** 

### numbers, some details, on that in the **10** 

### technical document? **11** 

### MR. BARRINGTON: Yes, certainly. **12** 

### MR. MOORE: What chapter do we need **13** 

### to look at? **14** 

### MR. BARRINGTON: So, Chapter 12 is **15** 

### the Manufacturers Impact Analysis. And **16** 

### there's the Government Regulatory Impact **17** 

### Model that accompanies that. **18** 

### MR. MOORE: So, that will show us how **19** 

### you got to 269 jobs lost? **20** 

### MR. BARRINGTON: Yes. Not lost, **21** 

### but -- so, that is the absolute number of **22** 

### production employment maintained through the

### Page 315

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### analysis period, estimated in 2018. Sorry. **2** 

### MR. MOORE: Then, we'll see the **3** 

### math? **4** 

### MR. BARRINGTON: Yes, absolutely. **5** 

### Yes. So, if it is at all helpful, that factor **6** 

### does include maintaining current shipment **7** 

### levels as from the shipment analysis, the cost **8** 

### structure as taken from the engineering **9** 

### analysis, and the impact on Industry Net **10** 

### Present Value -- I think I spoke to this **11** 

### earlier -- but the drop doesn't have to do with **12** 

### a reduction in production as much as it has to **13** 

### do with the investment, the upfront **14** 

### investment, in manufacturing capital and **15** 

### research and development. Okay. **16** 

### MR. BROOKMAN: Chris? **17** 

### MR. SALATINO: Chris Salatino, **18** 

### Scotsman. **19** 

### So, the numbers that you're showing **20** 

### for employment not dropping, essentially, **21** 

### remaining flat, is that domestic employment or **22** 

### is that saying the number of employees

### Page 316

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### required to build the equipment, whether it is **2** 

### here in the U.S. or some other market -- **3** 

### MR. BARRINGTON: So, it's -- **4** 

### MR. SALATINO: -- would be the same? **5** 

### MR. BARRINGTON: Pardon me. I **6** 

### didn't mean to cut you off there. **7** 

### It's for domestic production **8** 

### employment. So, we look at the portion of the **9** 

### industry that's manufactured domestically, **10** 

### whether that is owned by a parent company **11** 

### that's domestic or a parent company that's **12** 

### foreign-owned. We're agnostic to that. But **13** 

### those are manufacturer employment people, **14** 

### full-time equivalent, working in the United **15** 

### States producing this equipment. **16** 

### MR. BROOKMAN: Laura? **17** 

### MS. PETRILLO-GROH: Again, I'm not **18** 

### an economist. So, are these limited to a **19** 

### particular type of employee, perhaps someone **20** 

### who is actually working on the line versus **21** 

### someone who is an engineer at the company or -- **22** 

### MR. BARRINGTON: Yes, that's

### Page 317

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 correct. So, it's limited to production 2 employment alone, not engineering, not those**  **3 associated with sales, general or other 4 administrative tasks.**  **5 There's a description of exactly 6 where the cutoff is drawn in Chapter 12, and**  **7 I believe it goes up to forklift operators, 8 tied to warehousing of the equipment.**  **9 MS. PETRILLO-GROH: So, if I'm 10 correct, if you have estimated that the levels**  **11 of production will stay the same, the number 12 of people required to produce those same units**  **13 will be the same? 14 MR. BARRINGTON: That's correct.**  **15 MS. PETRILLO-GROH: Thank you. 16 MR. BROOKMAN: Ron?**  **17 MR. SOBAN: Ron Soban, Kold-Draft. 18 What are those numbers that we are**  **19 looking at? You are saying that's per 20 factory?**  **21 MR. BARRINGTON: No, that is the 22 entire employment of domestic production** 

### Page 318

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 employees -- 2 MR. SOBAN: In the --**  **3 MR. BARRINGTON: -- in the United 4 States.**  **5 MR. SOBAN: But what I'm saying, is 6 it thousands, is it tens of thousands? What**  **7 is it? 8 MR. BARRINGTON: It is absolute**  **9 numbers. 10 MR. SOBAN: That 268?**  **11 MR. BARRINGTON: Yes, 268 12 employees. And you can see on the employment**  **13 tab of the Government Regulatory Impact Model 14 how those numbers are arrived using**  **15 information from the U.S. Census Annual Survey 16 of Manufacturers to achieve or to estimate**  **17 both hourly wage rates for these full-time 18 equivalents as well as their fringe benefits**  **19 and medical costs. That would be added onto 20 that to determine a production cost.**  **21 MR. BROOKMAN: Do we have any 22 additional comments as you see comment box 23,** 

### Page 319

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### estimated impact on domestic production **2** 

### employment for manufacturers of automatic **3** 

### commercial ice makers? Any additional **4** 

### comments? **5** 

### (No response.) **6** 

### Nothing additional? **7** 

### How are you all doing? We have about **8** 

### 22 more slides? Do we need a break or are we **9** 

### able to keep going? We need to keep going? **10** 

### Okay, we'll keep going. Okay. **11** 

### Maybe we should just do this: let's **12** 

### break for five minutes, so people can dash to **13** 

### the restroom. Five minutes and, then, back **14** 

### here. Okay? Go quickly. **15** 

### (Whereupon, the foregoing matter **16** 

### went off the record at 3:28 p.m. and went back **17** 

### on the record at 3:35 p.m.) **18** 

### MR. BROOKMAN: We don't want to **19** 

### foreclose while we're here before we move on. **20** 

### Please, Chris, keep going. **21** 

### MR. SALATINO: So, I apologize for **22** 

### not being clear on it, but the numbers for

### Page 320

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 employment were 268, 269. What does that 2 number actually mean? Is that 269 employees**  **3 manufacturing ice makers per vendor, per 4 manufacturer, or total in the industry?**  **5 MR. BARRINGTON: This is Ben 6 Barrington from Navigant.**  **7 That's total domestic production 8 employment in the industry in the U.S.**  **9 MR. BROOKMAN: And that's for 10 production workers?**  **11 MR. BARRINGTON: Yes, that's for 12 production workers.**  **13 MR. SALATINO: So, I apologize, this 14 is going to be a remedial question. So,**  **15 that's saying that, say, Manitowoc had 50 16 production workers, Scotsman had 50**  **17 production workers, Ice-O-Matic had 50 18 production workers, down the line until you**  **19 get to 268, 269? 20 MR. BARRINGTON: That's correct.**  **21 MR. SALATINO: So, as far as impact 22 to employment, were there any assessments made** 

### Page 321

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 as to downstream? So, as far as component 2 suppliers, manufacturer employment impact to**  **3 them with these potential standards? 4 MR. BARRINGTON: So, no, we did not**  **5 directly assess the impact on -- is that -- 6 MR. SALATINO: It's our suppliers,**  **7 our vendors. 8 MR. BARRINGTON: Right. So, for**  **9 Danfoss, for instance, right, we did not 10 assess the impact on employment of those**  **11 component vendors. However, there is an 12 employment impact on a national scale that's**  **13 a separate analysis. 14 MR. BROOKMAN: An employment impact**  **15 not for manufacturers of commercial ice 16 makers?**  **17 MR. CYMBALSKY: So, no. So, this is 18 the indirect employment effect**  **19 of -- essentially, the standard comes in. 20 People have a positive cashflow on a monthly**  **21 basis. So, there's more money to spend into 22 the economy in general, which could, then,** 

### Page 322

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 instead of spending on electricity bills, 2 people are spending on goods and services, is**  **3 the general idea. 4 It's the general equilibrium**  **5 principle that if there's more money, more 6 cashflow in people's pockets, they spend it on**  **7 goods and services, not necessarily related to 8 the commercial ice-making industry. So,**  **9 restaurants and other service, generally 10 service industry will grow based on that.**  **11 MR. BROOKMAN: Yes, please, Scott. 12 MR. DESHETLER: Scott DeShetler,**  **13 Ice-O-Matic. 14 Just for the record, and we'll put**  **15 this in writing, but your employment 16 assumptions are completely off. They're just**  **17 completely off. You're not even close. 18 MR. BROOKMAN: I would think that**  **19 AHRI could do some rather quick polling and 20 masking and come up with some solid numbers**  **21 that they could submit, Laura? 22 MS. PETRILLO-GROH: Yes, I'm happy** 

### Page 323

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 to provide that information to the DOE. 2 MR. BROOKMAN: Yes.**  **3 MS. PETRILLO-GROH: And if there's 4 any other information, such as number of**  **5 products sold in each of the efficiency bins, 6 I would be happy to try to get that**  **7 information. 8 Before, it was stated that we didn't**  **9 provide that information. I honestly don't 10 think we were asked for that information**  **11 because all the information we were asked for 12 we certainly did provide.**  **13 MR. BROOKMAN: Yes. Well, that 14 would be most helpful. And you know the**  **15 Department, that's kind of, as John said, 16 that's the Holy Grail, that kind of**  **17 information. And their submission date is a 18 month.**  **19 MS. PETRILLO-GROH: Which is a 20 problem.**  **21 MR. BROOKMAN: Yes. Okay. 22 Anyway, whenever you can get it.** 

### Page 324

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### Okay. Now we are going to move on, **2** 

### please. **3** 

### MS. NIEMEYER: Okay. Michelle **4** 

### Niemeyer, Pacific Northwest National **5** 

### Laboratory. **6** 

### All right. The last of the **7** 

### analyses, the emissions, the utility, and **8** 

### employment, different type of employment. **9** 

### So, the emissions analysis, this **10** 

### includes primary power plant emissions plus **11** 

### the upstream emissions. That includes **12** 

### extraction, processing, and transporting of **13** 

### fuels to the site. And you put those **14** 

### together, and you have the full fuel cycle **15** 

### emissions, which is what's on that table. **16** 

### Then, we monetize carbon. We do **17** 

### this using the latest interagency report that **18** 

### was released in November of 2013. It has **19** 

### values ranging from $11.8 to $117 per metric **20** 

### ton. Those values are for 2015 in 2012 **21** 

### dollars. **22** 

### So, the numbers increase over time,

### Page 325

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 and the interagency report vetted values 2 through 2050. But, since our analysis goes a**  **3 little past 2050, we used the 2040-to-2050 4 average annual growth rate to grow the numbers**  **5 past 2050. 6 For NOx it is much simpler. We just**  **7 have three numbers, a low, a high, and then, 8 an average medium value that we quote most**  **9 often. 10 Does anyone have any comments on the**  **11 social cost of carbon numbers or the growth 12 rates?**  **13 (No response.) 14 MR. BROOKMAN: No comments here.**  **15 MS. NIEMEYER: Nothing? Okay, 16 moving on.**  **17 So, those are the actual Present 18 Values of the carbon reduction for all four**  **19 values. They each have their own discount 20 rates, as dictated by the interagency report.**  **21 So, for TSL3, the value of carbon ranges from 22 102 million to 1,426 million.** 

### Page 326

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 And the Present Value of NOx, 2 discounted at a 7 percent and 3 percent**  **3 discount rate. 4 And moving on to the utility**  **5 analysis -- 6 MR. BROOKMAN: Frank?**  **7 MR. MOORE: Just one question. Was 8 this the same set of numbers used in CRE? And**  **9 I know you all got a lot of comments, pro and 10 con. So, no changes? The comments from CRE**  **11 had no impact on what you decided to do going 12 forward?**  **13 MR. CYMBALSKY: No. So, in the 14 final rule, we stuck with the latest**  **15 interagency numbers, yes. 16 MR. BROOKMAN: Thank you, John.**  **17 Okay. 18 MS. NIEMEYER: Okay. All right.**  **19 So, the purpose of the utility analysis, to 20 estimate changes on the install capacity and**  **21 generation for the utility sector. 22 We do this using NEMS, which is** 

### Page 327

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### released by EIA. Basically, we take EIA's **2** 

### reference case forecast for the utility **3** 

### sector, and then we kind of shave off the **4** 

### energy savings from the NIA model. And then, **5** 

### that gives us a reduction in electricity **6** 

### generation and install capacity. **7** 

### Okay. Employment. All right. **8** 

### So, the purpose of this is to estimate the net **9** 

### jobs nationally due to the proposed standards. **10** 

### This is different than what Ben presented, **11** 

### where he was looking directly at the **12** 

### manufacturing sector. **13** 

### So, here we use an input/output model **14** 

### called the ImSET, which it looks at the **15** 

### relationship between sectors and how dollars **16** 

### flowing out of one sector flow into another **17** 

### sector, and how they impact each other. **18** 

### So, if you have changes in equipment **19** 

### costs or reduced energy expenditures, you **20** 

### know, you end up spending that money in **21** 

### different parts of the economy. **22** 

### So, for TSL3 and the start year of

### Page 328

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 2018, it is estimated that there would be 75 2 to 87 jobs created, and then, for 2022, 431 to**  **3 442. 4 Questions?**  **5 MR. BROOKMAN: Comments here? Yes? 6 MR. SALATINO: I'm sorry. Chris**  **7 Salatino. 8 So, the employment analysis that**  **9 we're referring to here refers to automatic 10 commercial ice maker employers or employees?**  **11 MS. NIEMEYER: No. 12 MR. CYMBALSKY: So, it's what I**  **13 described just a moment ago. So, the impact 14 on the whole economy of people having more**  **15 monthly cashflow, based on less electricity 16 expenditures, and the fact that you don't**  **17 build a power plant. You have this extra 18 capital that is floating around that's being**  **19 spent on other goods and services other than 20 commercial ice maker manufacturing. It**  **21 creates jobs in other sectors of the economy. 22 MS. NIEMEYER: And some sectors of** 

### Page 329

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### the economy are very capital-intensive; some **2** 

### are very labor-intensive. So, if that money **3** 

### is moving into labor-intensive sectors, then **4** 

### you would -- **5** 

### MR. MOORE: So, can I just **6** 

### get -- because I want to make sure we're **7** 

### comparing apples to apples. So, I guess it's **8** 

### good news/good news, right, from your **9** 

### analysis? The good news is there are 270 **10** 

### folks making ice machine, and with the new **11** 

### rule, they'll still be there. And then, the **12** 

### extra good news is that we'll be adding all **13** 

### these new jobs somewhere else in the economy? **14** 

### I mean, is that -- okay, all right. **15** 

### MR. BROOKMAN: Additional comments **16** 

### here? **17** 

### MR. CYMBALSKY: I could say this is **18** 

### not unique to this rulemaking. **19** 

### MR. MOORE: Yes, I know. I want to **20** 

### make sure that number, 270, are individuals **21** 

### using -- **22** 

### MR. DESHETLER: Scott DeShetler,

### Page 330

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### Ice-O-Matic. **2** 

### And I apologize, I don't have all the **3** 

### details behind this. But are the details **4** 

### behind this we can get to? I mean, you know, **5** 

### we know that the numbers on how many people are **6** 

### employed making ice machines are totally **7** 

### wrong. We know that. **8** 

### No. 2, the assumption that they're **9** 

### all going to stay here while we're sucking 20 **10** 

### percent of the value of the companies out, the **11** 

### owners are just going to go along and just say, **12** 

### "Hey, this is cool. No problem. I'll quit **13** 

### trying to run my business the way I'm running **14** 

### it." -- they will change the way they run their **15** 

### business. **16** 

### And so, the likelihood is most, if **17** 

### not all, of those people making ice machines **18** 

### will be living in another country in 10 years. **19** 

### And No. 2, they won't be spending their money **20** 

### in this economy; they will be spending it in **21** 

### somebody else's economy. And so, somebody **22** 

### else may be experiencing the 100 additional,

### Page 331

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 but we won't. They will. That's guaranteed. 2 MR. BROOKMAN: John Cymbalsky?**  **3 MR. CYMBALSKY: So, yes, I was 4 taking to Ben at the break, and we're going to**  **5 look into this, too, to see what happened in 6 the industry when the first standard came in,**  **7 how the industry may or may not have changed, 8 and how this change may be relevant or not**  **9 relevant to what we saw before. 10 So, we're going to look into that,**  **11 but if you, particularly the manufacturers, 12 can provide us any information on that,**  **13 obviously each standard level is different and 14 what's assumed in the standards different.**  **15 But it would be helpful to know how the 16 industry changed with the last standard. I'm**  **17 not saying it's completely relevant, but at 18 least it's a good datapoint.**  **19 MR. BROOKMAN: Okay. Yes, please, 20 George.**  **21 MR. PARSONS: George Parsons, 22 Ice-O-matic.** 

### Page 332

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### That will be encouraging. I will **2** 

### tell you, from my background, I've in the air **3** 

### conditioning industry, I've been in **4** 

### commercial refrigeration, and now I'm sitting **5** 

### here. **6** 

### And I believe if you go back and look **7** 

### at 10 to 15 years' worth of data in commercial **8** 

### HVACs, specifically, what you will see is unit **9** 

### cells may be there for many of them. They're **10** 

### big enough to maintain two designs, one to sell **11** 

### globally, one to sell in the United States. **12** 

### You will also find many of them have **13** 

### moved their production either into Asia or **14** 

### Mexico. And so, there has been an impact. **15** 

### And I do want to add, I think it is **16** 

### vital that you understand that, when you say **17** 

### you do a Net Present Value analysis, if I'm a **18** 

### business owner sitting around this table, if **19** 

### our owners were sitting here, whether it's **20** 

### shareholders or individual people, whoever it **21** 

### is, when you tell them they're going to spend **22** 

### more money on R&D, and whether you want to

### Page 333

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 realize it or not, we're going to spend more 2 on hard capital; we'll have to retool our**  **3 factories. We've got to make a bigger evap 4 plate. It will cost capital.**  **5 If you believe they are going to do 6 those two things and accept the same basic**  **7 revenue level with expenses going up, they're 8 not. They are going to maintain their profit**  **9 level. They will. 10 And when they look at maintaining**  **11 their profit level, you go after your 12 component suppliers, frankly, but you'll look**  **13 at the cost of your labor. We are in a very 14 labor-intensive business. So, labor is a**  **15 large component of our cost, larger than 16 others.**  **17 So, it's critical. I just don't 18 think you can make the assumption that they're**  **19 going to accept those additional expenses 20 without reacting to that.**  **21 MR. BROOKMAN: Karim? 22 DR. AMRANE: Karim Amrane, AHRI.** 

### Page 334

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### Just a couple of examples. I think **2** 

### we don't need to go too far. I mean, look at **3** 

### household refrigerators. I mean, all of them **4** 

### are made overseas now, and they aren't made **5** 

### anymore here. Look at room air conditioners. **6** 

### The entire industry moved overseas. **7** 

### So, those are real examples. This **8** 

### has happened over the years, starting from **9** 

### when NAECA was -- **10** 

### MR. CYMBALSKY: And I **11** 

### appreciate -- you know, American **12** 

### manufacturing is actually important to my **13** 

### boss -- so, we do appreciate that. To say that **14** 

### jobs moved overseas because of standards for **15** 

### room air conditioners, for example, these **16** 

### things happen because of globalization of **17** 

### capital and pretty much labor. You know, **18** 

### corporations made economic decisions to do **19** 

### that. **20** 

### For large commercial HVAC, we **21** 

### haven't set standards. So, if, in fact, **22** 

### they're all moving that overseas at the time

### Page 335

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 when there's no standards, obviously, there's 2 other factors at play here.**  **3 So, we need to be careful about 4 attributing decline in U.S. manufacturing to**  **5 at least appliance standards in total. But we 6 understand the point and we do our due**  **7 diligence to understand the employment impact 8 better.**  **9 Thank you. 10 MR. BROOKMAN: We're about to move**  **11 on. Okay? Final comments? 12 (No response.)**  **13 Yes, we're moving on. 14 MS. NIEMEYER: All right.**  **15 MR. CYMBALSKY: Okay. So, at the 16 end of the road here, I'll finish up with the**  **17 TSLs. 18 You have seen this slide already. I**  **19 won't reread it, but you can see, based on all 20 the engineering analysis, all the economic**  **21 analysis, emissions analysis, et cetera, we 22 bundled the TSLs, and, then, based on all of** 

### Page 336

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### that information, we chose TSL3, right there **2** 

### in the middle. **3** 

### Here is the chart I had you flip to **4** 

### earlier to try to help understand the TSLs and **5** 

### the ELs. Again, I request that everybody take **6** 

### a hard look at this, look at the engineering **7** 

### data, the retail cost data, the shipments **8** 

### data, all that, and help us make the analysis **9** 

### more robust by supplementing with whatever **10** 

### data you can. **11** 

### But you can see here, this is the **12** 

### mapping. And then, this chart shows you what **13** 

### actually happens as you step across into the **14** 

### TSLs by the product equipment classes. So, **15** 

### for example, the first line up there, TSL3, you **16** 

### basically have got to do what is in TSL1, and **17** 

### then, you then do what is in TSL3. So, it is **18** 

### a combination of those features being added **19** 

### together. **20** 

### And then, down at the bottom is the **21** 

### key as to what all those things mean. So, to **22** 

### get to the level of TSL3, you have to do those

### Page 337

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### four or five things that are listed there in **2** 

### both TSL1 and TSL3. And so, I won't read **3** 

### through this whole chart. **4** 

### But, again, this is where we ask you **5** 

### to look at very carefully and provide public **6** 

### comment for the final rule. **7** 

### And then, this is just going down the **8** 

### product classes again. We won't read through **9** 

### these. But this is where your public comment **10** 

### in written form will help us quite a bit. And **11** 

### we have a comment box here. **12** 

### I think at this point it would be **13** 

### better for everyone to actually put their **14** 

### comments in writing because reading this out **15** 

### of a transcript is less helpful than your **16** 

### written comments on these because it is very **17** 

### technical in nature. **18** 

### But, sure, go ahead. **19** 

### MR. SALATINO: Sorry. Chris **20** 

### Salatino, Scotsman Ice. **21** 

### And just one quick question. As far **22** 

### as providing data and comment up until May

### Page 338

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 16th, is there an opportunity -- I mean, so as 2 you guys receive loads of data and you digest**  **3 that, is there going to be any dialog or go back 4 and forth to ask questions about our data, our**  **5 interpretations? Or is it a closed period 6 from May 16th until January 1?**  **7 MR. CYMBALSKY: So, I think under 8 the NDA with the contractors, there is the**  **9 ability to have those meetings about your 10 data. There will not be any policy dialog**  **11 like this we have today. 12 There is an opportunity for ex parte**  **13 communications at any point. Basically, you 14 request a meeting with me. It's on the**  **15 record. We can't answer; we mostly are in 16 listening mode. We can answer questions that**  **17 are clarifying-type questions, but we can't 18 say, "Oh, based on that data, we're going to**  **19 do this." So, it is not that kind of 20 back-and-forth.**  **21 But I think a lot of stakeholders 22 have found those meetings useful in the past,** 

### Page 339

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### just as a good back-and-forth. And again, **2** 

### it's on the record. So, we don't need to ask **3** 

### you to submit to the docket a summary of what **4** 

### the meeting was about. **5** 

### MR. BROOKMAN: Laura? **6** 

### MS. PETRILLO-GROH: So, I think some **7** 

### of the concerns raised today really do require **8** 

### a feedback loop. Is there any precedent or **9** 

### possibility of entertaining a negotiated **10** 

### rulemaking for this? **11** 

### MR. CYMBALSKY: So, we talked about **12** 

### this a little bit earlier. And so, you know, **13** 

### most people in the room -- well, maybe not most **14** 

### because a lot of you are not necessarily always **15** 

### plugged into our process. **16** 

### But, you know, it has been the **17** 

### Department's position to try to negotiate as **18** 

### many of these things as possible, and we have **19** 

### a few different ones going on. Personally, I **20** 

### think people have found the process quite **21** 

### good. There is real-time dialog in meetings, **22** 

### again, all on the record, of course, in a

### Page 340

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### public forum. **2** 

### At this point, the Department has **3** 

### already publicly stated what it thinks it is **4** 

### going to do, absent any different public **5** 

### comment to change that. So, in my sense, for **6** 

### us to negotiate anything here, a Committee **7** 

### would be made up of one DOE person, and then, **8** 

### the efficiency advocates and, then, **9** 

### manufacturers, whoever the stakeholders are. **10** 

### So, it is just difficult for me to **11** 

### think in my head what we would be negotiating **12** 

### and get consensus around the table, given that **13** 

### our proposal is already out. I'm not saying **14** 

### that we wouldn't do it. We're open to hearing **15** 

### what all the stakeholders say about that. **16** 

### I can say that would be sort of new **17** 

### ground. We usually start a negotiated **18** 

### rulemaking earlier in the process, where the **19** 

### Department hasn't, you know -- I have already **20** 

### put my two aces on the table. **21** 

### But that's not to say -- I mean, we **22** 

### always listen to what you think we -- you know,

### Page 341

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 negotiation is usually a give-and-get. So we 2 have our cards on the table. We would have to**  **3 negotiate around what is already proposed. 4 And again, the efficiency, this**  **5 wouldn't be a bilateral negotiation. It 6 would be as many stakeholders that are**  **7 relevant to this process. 8 Andrew, it's not for today, but,**  **9 obviously, they would be a voice at the table. 10 So, in my mind, maybe it is not impossible. I**  **11 guess I'm just wondering how that would go and 12 where it would go, and given the January 1st**  **13 deadline for final. 14 MR. BROOKMAN: And Laura, please.**  **15 MS. PETRILLO-GROH: I mean, I think 16 the most important point here is a corrected**  **17 analysis, so that we're sure what we're 18 looking at are real efficiency and real cost.**  **19 MR. CYMBALSKY: Right. So, I think 20 that can happen in the notice and comment,**  **21 right? So, if we get a bunch of data that 22 suggests what we did was not correct, we are** 

### Page 342

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 going to revise the analysis. We do that in 2 every rulemaking. That doesn't have to be**  **3 negotiated. That's standard operating 4 procedure for us. We don't ignore the facts**  **5 that are provided us. 6 DR. AMRANE: And that's fine. This**  **7 is Karim. I'm with the AHRI. 8 That's fine, but at the same time we**  **9 don't have any feedback. I mean, that is what 10 we are asking here, is the feedback.**  **11 I think there are serious concerns 12 with the analysis that I believe require some**  **13 feedback. So, as long as we have the 14 feedback, we don't have maybe the need for**  **15 negotiation. 16 MR. CYMBALSKY: So, are you arguing**  **17 for another public meeting before the final 18 rule? Is that --**  **19 DR. AMRANE: No. I am suggesting 20 that, please, there will be discussion between**  **21 the contractor and the manufacturers and maybe 22 everybody together in the same room, talking** 

### Page 343

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### about the data and talking about -- **2** 

### MS. PETRILLO-GROH: This is Laura. **3** 

### And not just one-sided, you know, **4** 

### conversations where the Department can't give **5** 

### feedback. Because there are issues that do **6** 

### require feedback, and even if this is **7** 

### unprecedented ground, it is a strong **8** 

### consideration. **9** 

### MR. BROOKMAN: That was Laura. **10** 

### MR. CYMBALSKY: So, this is John **11** 

### again. **12** 

### So, when we were negotiating the **13** 

### transformer rule, there was something unique **14** 

### to that where we did post like a NODA, a Notice **15** 

### of Data Availability, which posted a new **16** 

### analysis after the NOPR but before the final **17** 

### rule. **18** 

### So, you know, if that's legally okay **19** 

### by my counsel, and it's something we could **20** 

### provide that will help -- again, we do have a **21** 

### bit of a time crunch here. So, I don't want **22** 

### to promise anything, but we do want to make

### Page 344

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### this as open as legally possible. **2** 

### MR. BROOKMAN: Daryl? **3** 

### MR. ERBS: Yes, Daryl Erbs from **4** 

### Manitowoc Ice. **5** 

### I guess I want to echo the same **6** 

### sentiment, that I think we're pretty far **7** 

### apart. I think we feel that we have **8** 

### legitimate concerns. We have data to back it **9** 

### up. **10** 

### You know, we can set up meetings with **11** 

### your contractor. We can share data under NDA. **12** 

### But we really need to understand where that's **13** 

### going to take this. **14** 

### You know, the short time crunch that **15** 

### we're under is partly the result of the NOPR **16** 

### and the TSD only getting published very **17** 

### recently. So, we went for a period of -- I **18** 

### don't know; was it a year and a half? Or I **19** 

### can't even remember when we actually had the **20** 

### last preliminary public review. **21** 

### We turned in comments after that **22** 

### initial, you know, for that meeting. And some

### Page 345

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### of those things didn't change, and we had no **2** 

### real feedback that those things weren't going **3** 

### to change until a few weeks ago. **4** 

### So, I think the concern is that we **5** 

### will supply a lot of written comments and data, **6** 

### and then, there's no more public meeting and **7** 

### there isn't any guarantee of any kind of **8** 

### feedback process. And we'll maybe be **9** 

### surprised again. **10** 

### And so, I think it would be, maybe we **11** 

### would have a better chance of reaching some **12** 

### type of a compromise that the industry can **13** 

### support if we can sit down and somehow discuss **14** 

### what the middle ground might be that we can all **15** 

### live with. **16** 

### MR. CYMBALSKY: Yes. So, that's a **17** 

### little different than I think what Karim was **18** 

### describing. But we will do our best. You **19** 

### know, we will talk it over with counsel and see **20** 

### what options are available. **21** 

### You know, we're not here in a black **22** 

### box trying to hide anything. That's not our

### Page 346

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 intent. It never was our intent. 2 And the data you provide us, to the**  **3 extent that it changes the analysis, we will 4 revise the analysis. There's no question**  **5 about it. There are things we have heard 6 today that will absolutely cause us to go back**  **7 and revise things. 8 We normally refresh the data anyway,**  **9 but the fact that it sounds like you guys will 10 come forward with a lot more data, that's**  **11 great. And so, we will absolutely take that 12 into account in the final rule.**  **13 MR. BROOKMAN: Scott? 14 MR. DESHETLER: Well, just a thought**  **15 here. I think everybody in the room wants the 16 rule that goes into place January to be the**  **17 right rule. 18 The manufacturers here today believe**  **19 that there are so many discrepancies in the 20 analysis that we may end up with a rule that's**  **21 a wrong rule. And the consequences may not be 22 what we all expected.** 

### Page 347

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 I don't think anybody wants that in 2 the room. So, we, as manufacturers, are**  **3 trying to figure out a way to actually work 4 with something closer to reality and less**  **5 academic. And we can bring that. We have got 6 hundreds of years of experience here. These**  **7 guys, not me -- I've only been in the industry 8 three years -- but these guys here have built**  **9 machines. I don't think there's probably 10 anybody else in the room that actually built**  **11 a machine. These guys grew up in this thing. 12 They understand these machines.**  **13 They are all committed to 14 environmental responsibility. We are all**  **15 committed to those types of things. But we 16 have to do it in such a way that we don't kill**  **17 businesses, ruin employment, or just simply 18 kill an industry.**  **19 And we think that's where we are 20 right now. We need to be able to speak with**  **21 you, bring the data to you, and look at these 22 analyses to see if we can get closer to what** 

### Page 348

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### reality is. **2** 

### I don't mind a stretch, and I don't **3** 

### think anybody in this room minds a stretch. **4** 

### But there's a difference between a stretch and **5** 

### a leap of faith. And I think that's the **6** 

### difference we're dealing with here today. **7** 

### MR. CYMBALSKY: Yes, and DOE, I **8** 

### mean, I would echo everything you said. I'm **9** 

### not sitting here trying to kill an industry; **10** 

### that's for sure. I don't want that. Nobody **11** 

### in this Department wants that. **12** 

### And the data that you provide, the **13** 

### analysis is driving the reg here. And so, **14** 

### what drives the analysis is the data. So, you **15** 

### provide the data; we have the analysis. That **16** 

### should all come out precisely like you said, **17** 

### if all the data support what you said. And so, **18** 

### that will be the answer. **19** 

### MR. BROOKMAN: Karim? **20** 

### DR. AMRANE: Yes, this is Karim **21** 

### Amrane with AHRI. **22** 

### I have a request. I understand that

### Page 349

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 most of the analysis was done through 2 modeling, and I understand that there have**  **3 been some tests done. 4 We would like that those tests be**  **5 made available to us for review. We can keep 6 the manufacturer's name confidential, but we**  **7 would like to see those reports, and how many 8 you have done, and those reports that validate**  **9 your model, in particular. I think it should 10 be public information.**  **11 Thank you. 12 MR. BROOKMAN: Yes, thank you.**  **13 So, we have reached the point in the 14 meeting where --**  **15 MR. CYMBALSKY: Wait, wait. I 16 didn't get to this slide. Sorry.**  **17 MR. BROOKMAN: Yes, there's one more 18 small segment.**  **19 MR. CYMBALSKY: Yes. 20 MR. BROOKMAN: I think we may have**  **21 done this fully at this point. As I promised 22 at the outset, an opportunity for final** 

### Page 350

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### remarks, closing remarks. **2** 

### MR. CYMBALSKY: I really didn't **3** 

### finish yet. **4** 

### MR. BROOKMAN: Oh, okay. **5** 

### MR. CYMBALSKY: Sorry. **6** 

### MR. BROOKMAN: Okay. **7** 

### MR. CYMBALSKY: So, there's a couple **8** 

### more graphs here about the standard. **9** 

### MR. BROOKMAN: Okay. **10** 

### MR. CYMBALSKY: So, here are the **11** 

### proposed standards in equation form or number. **12** 

### You can see going down. I'm not going to read **13** 

### them. **14** 

### But, again, similar to what we did **15** 

### for commercial refrigeration, and I spoke to **16** 

### a lot of manufacturers after the NOPR at **17** 

### meetings where they provided us spreadsheets **18** 

### of what they had. So, these are things you can **19** 

### do and submit them. So, we can have a look at **20** 

### how you think these equations map to what you **21** 

### consider your reality in the manufacturing **22** 

### world.

### Page 351

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 And then, here we go with a little bit 2 graphically what we are talking about here.**  **3 MS. PETRILLO-GROH: I'm sorry, just 4 I don't understand what DOE standard versus**  **5 the proposed standard is. Is that the red 6 lines of the current standard level?**  **7 MR. CYMBALSKY: Yes. 8 MS. PETRILLO-GROH: Okay. Thank**  **9 you. 10 MR. CYMBALSKY: So, this is just for**  **11 one example, but, you know, you can open up 12 Excel, plug the formulas in. And trust me,**  **13 the CRE guys gave me a bunch of spreadsheets 14 where they did this.**  **15 And then, continuous, the same 16 thing.**  **17 Just hold your thought just for a 18 second.**  **19 And then, finally, again, the 20 comment period closes May 16th. Here's how**  **21 you submit your written comments. And again, 22 please copy either Brenda or myself or both** 

### Page 352

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 because we have had problems not receiving 2 comment because those mailboxes, if you type**  **3 even one thing wrong, you will not get a 4 kickback, and we would like to get your**  **5 comment. 6 So, please.**  **7 MR. BROOKMAN: And also, in addition 8 to whatever comments following these closing**  **9 comments, additional remarks at the close of 10 the day.**  **11 Scott? 12 MR. BINGHAM: This is Scott Bingham**  **13 with Follett. 14 If you go to the next slide, the**  **15 continuous -- two forward -- that maximum 16 energy use, is that the measured energy or the**  **17 adjusted energy use, the adjustment with the 18 ice hardness?**  **19 MR. CYMBALSKY: Adjusted, for the 20 record.**  **21 MR. BROOKMAN: Closing remarks? 22 MS. PINTO: Hey, Doug?** 

### Page 353

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### MR. BROOKMAN: Francine? **2** 

### MS. PINTO: Yes, Francine Pinto. **3** 

### I just wanted to confirm that Andrew **4** 

### DeLaski's comments on the compliance date this **5** 

### morning were correct. So, there's three **6** 

### years from the date that the final rule, **7** 

### amended rule, is published. And if the **8** 

### Secretary determines that three years is **9** 

### inadequate, then it is no later than five **10** 

### years. And you can find that in 42 USC **11** 

### 6313(d)(3)(C). **12** 

### MR. BROOKMAN: That's helpful. **13** 

### Thank you. **14** 

### MR. MOORE: So, one just **15** 

### clarification on that. **16** 

### MR. BROOKMAN: Frank, please. And **17** 

### use the microphone, Frank. **18** 

### MR. MOORE: I'm sorry. **19** 

### So, the statutory clarification that **20** 

### something will come out by January of next year **21** 

### is that you determine whether or not a change **22** 

### needs to be made --

### Page 354

**202-234-4433 Neal R. Gross and Co., Inc.**  **1** 

### MS. PINTO: Correct. **2** 

### MR. MOORE: -- not that you've got to **3** 

### make one? **4** 

### MS. PINTO: Correct, whether or not. **5** 

### MR. MOORE: All right. **6** 

### MS. PINTO: And then, if we set **7** 

### amended standards, then it's three years from **8** 

### the date of publication or three years is **9** 

### inadequate; five years. **10** 

### MR. BROOKMAN: Okay. That is **11** 

### helpful. **12** 

### Final comments before we head in our **13** 

### separate ways? **14** 

### (No response.) **15** 

### So, for my part, I thank you. We **16** 

### covered a lot of ground today and some very **17** 

### important issues for all of you in the room. **18** 

### Closing remarks from John Cymbalsky? **19** 

### MR. CYMBALSKY: So, I would just **20** 

### thank everybody for coming. I know there's a **21** 

### lot of issues that were brought up. **22** 

### Like I said, the comments we receive

### Page 355

**202-234-4433 Neal R. Gross and Co., Inc.**  **1 in the next month or so will certainly 2 determine the path of how we go on the final**  **3 rule. 4 As Francine just mentioned, the**  **5 Secretary may determine that three years is 6 not enough. He could potentially say five**  **7 years. Again, public comment is going to 8 determine whether or not the Secretary makes**  **9 that decision. 10 And then, otherwise, we look forward**  **11 to getting your comments, and we will explore 12 the data availability path going forward.**  **13 So, thank you all for attending. 14 (Whereupon, at 4:10 p.m., the**  **15 meeting was adjourned.) 16**  **17 18**  **19 20**  **21 22** 

### 202-234-4433 **Neal R. Gross and Co., Inc. Page 356**  A $100 298:9 $11.8 324:19 $117 324:19 $1500 202:7 211:18 $20 190:11 191:17 $20.9 298:16 $23.9 298:17 $30,000.0043:8 $300 211:16 246:15

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### 202-234-4433 **Neal R. Gross and Co., Inc. Page 358**  applications 27:1 122:5 applied 64:5 118:5 118:7 121:3,20 123:5 191:20 applies 21:3 215:15 apply 120:10,13 177:16 265:20 283:22 appreciate 5:3 14:10 15:13 39:20 125:22 157:14 172:6 220:20 334:11,13 approach 19:6,9

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### 202-234-4433 **Neal R. Gross and Co., Inc. Page 401**  1975 58:7 1978 58:9 1980s 255:22 1R134A 16:17 1st341:12 2 2 8:8 165:19 166:9 171:16 179:2 215:22 218:16 240:5,6 267:11 274:19 330:8,19 2-percent245:12 2,000-bin223:16 2,000-pound

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238:3 240:3 251:21 268:18 60-percent251:15

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353:11 64 252:14 67 240:3 268:18 7 7 59:22 221:13

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226:17 8074:10 122:17

252:5 308:7 80-percent252:4 800,000 15:5 810-2007 60:3 82 295:14 87 295:16,18 328:2 8E-089 1:12 9NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVE., N.W. (202) 234-4433 WASHINGTON, D.C. 20005-3701 www.nealrgross.com C E R T I F I C A T E

This is to certify that the foregoing transcript

In the matter of:

Before:

Date:

Place:

was duly recorded and accurately transcribed under my direction; further, that said transcript is a true and accurate record of the proceedings.

----------------------- Court Reporter 402

Energy Conservation Standards for Automatic Commercial Ice Makers

US DOE

04-14-14

Washington, DC