1

- i CHAPTER 1. INTRODUCTION

TABLE OF CONTENTS

1.1 PURPOSE OF THE DOCUM ENT

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- 1 1.2 OVERVIEW OF THE APPL IANCES AND COMMERCIA L EQUIPMENT STANDARDS PROGRAM

................................ ................................ ................................ ......... 1

- 1 1.3 OVERVIEW OF METAL HA LIDE LAMP FIXTURES S TANDARDS

...................... 1

- 2 1.4 PROCESS FOR SETTING ENERGY CONERVATION STANDARD S

...................... 1

- 4 1.5 STRUCTURE OF THE DOC UMENT

................................ ................................ ............ 1

- 7

LIST OF TABLES

Table 1.4.1 Analyses Under the Process Rule

................................ ................................ ............ 1

- 51

- 1 CHAPTER 1. INTRODUCTION

1.1 PURPOSE OF THE DOCUMENT

This preliminary technical support document (TSD) provides the analytical approaches, inputs and results associated with the U.S. Department of Energy’s ( DOE’s ) study of energy conservation standards for metal halide lamp fixtures . The preliminary TSD also serves to provide technical detail and is a compendium to the life

- cycle cost (LCC) and payback period (PBP) and national impact analysis (NIA) spreadsheets that are posted on the DOE’s website f or the preliminary analysi s. a

1.2 OVER VIEW OF THE APPLIANCES AND COMMERCIAL EQUIPMENT STANDARDS PROGRAM

Part B of Title III of the Energy Policy and Conservation Act (EPCA) of 1975 (42 U.S.C. 6291

– 6309) established the energy conservation program for consumer products other than automobiles, c overing major household appliances

. Additional amendments to EPCA have given the U.S. Department of Energy the authority to regulate the energy efficiency of several products, including metal halide lamp fixtures , the products that are the focus of this do cument

. Before DOE determines whether to adopt a proposed energy conservation standard, it first solicits comments on the proposed standard. DOE designs any new or amended standard to achieve the maximum improvement in energy efficiency that is technologi cally feasible and economically just ified. (42 U.S.C. 6295(o)(2)(A) ) To determine whether economic justification exists, DOE must review comments on the proposal and determine that the benefits of the proposed standard exceed its burdens to the greatest ex tent practicable, weighing the following seven factors:

(1) the economic impact of the standard on the manufacturers and consumers of the products subject to the standard;

(2) the savings in operating costs throughout the estimated average life of the products compared to any increases in the price, initial charges, or maintenance expenses for the products that are likely to result from the imposition of the standard;

(3) the total projected amount of energy savings likely to result directly from impo sition of the standard;

(4) any lessening of the utility or the performance of the products likely to result from imposition of the standard;

a The preliminary analysis can be found here: http://www1.eere.energy.gov/buildings/appliance_standards/commercial/metal_halide_lamp_fixtures.html1

- 2 (5) the impact of any lessening of competition, as determined in writing by the Attorney General, likely to result from imposition of the standard;

(6) the need for national energy conservation; and

(7) other factors the Secretary considers relevant

. (42 U.S.C. 6295(o)(2)(B)(i))

1.3 OVERVIEW OF METAL HALIDE LAMP FIXTURES STANDARDS

The following summarizes the pertinent legislative and regulatory history for metal halide lamp fixtures (MHLFs) . DOE is conducting its first rulemaking cycle to review and consider amendments to the energy conservation standards in effect for metal halide lamp fixture s , as required under 42 U.S.C. 6295(hh)(2), which provides as follows:

(2) Final rule by January 1, 2012.

— (A) In general.

— Not later than January 1, 2012, the Secretary shall publish a final rule to determine whether the standards established under paragraph (1) should be amended. (B) Administration.

— The final rule shall

— (i) contain any amended standard; and (ii) apply to products manufactured on or after January 1, 2015

.

On December 19, 2007, the President signed the Energy Independence and Security Act of 2007 (EISA 2007) which made numerous amendments to EPCA and directed DOE to undertake several new rulemakings for appliance energy conservation standards. (Pub. L. 1 10

- 140) The MHLF provisions, section 324 of EISA 2007, amended EPCA by:

• inserting definitions pertaining to “metal halide ballast,” b “metal halide lamp,” c and “metal halide lamp fixtures” d (among others) into section 321 of EPCA (42 U.S.C. 6291(62),(63), and (64));

• amending section 323(b) of EPCA to direct DOE to develop a test procedure for metal halide (MH) lamp ballasts based on the American National Standard Institute (ANSI) Standard C8 2.6

- 2005, Ballasts for High

- Intensity Discharge (HID) Lamps

- Methods of Measurement (42 U.S.C. 6293(b)(18));

b “Metal halide ballast” means “a ballast used to start and operate metal halide lamps.” (42 U.S.C. 6291(62))

c “Metal halide lamp” means “a high intensity discharge lamp in which the major portion of the light is produced by radiation of metal halides and their products of dissociation, possibly in combination with metallic vapors.” (42 U.S.C. 6291(63))
d “Metal halide lamp fixture” means “a light fixture for general lighting application designed to be operated with a metal halide lamp and a ballast for a metal halide lamp.” (42 U.S.C. 6291(64))1

- 3 • amending section 324(a)(2) of EPCA by directing the Federal Trade Commission (FTC) to conduct a labeling rulemaking for metal halide lamp fixture s ( 42 U.S.C. 6294(a)(2)(C)); and

• amending section 325 of EPCA by prescribing energy conservation standards for metal halide lamp fixture s , requiring that they contain ballasts that meet or exceed defined efficiency levels. Compliance with the EISA 2007

- prescr ibed standards was required as of January 1, 2009. (42 U.S.C. 6295(hh)(1)) Additionally, the Secretary is directed to publish a final rule no later than January 1, 2012 to determine whether the energy conservation standards established by EISA 2007 for met al halide lamp fixture s should be amended

. If such amend ments to the standards are appropriate under the relevant statutory criteria, the final rule shall apply to products manufactured on or after January 1, 2015. (42 U.S.C. 6295(hh)(2) (B) ) The Secretary is further directed to conduct a second rulemaking to review and amend the energy conservation standards for metal halide lamp fixture s then in effect , which requires publication of a final rule by January 1, 2019. (42 U.S.C. 6295(hh)(3))

The following s tatutory provisions are directly relevant to the energy conservation standards rulemaking for metal halide lamp fixture s. As amended by EISA 2007, EPCA regulates metal halide lamp fixture s designed to be operated with lamps rated greater than or equal to 1 50 watts (W), but less than or equal to 500 W by prescribing performance requirements for the MH lamp ballasts used in those metal halide lamp fixture s . Both MH lamps and ballasts
are energy

- using components of metal halide lamp fixture s . For this MH lamp wattage range, metal halide lamp fixture s must contain the following :

(i) a pulse

- start metal halide ballast with a minimum ballast efficiency of 88 percent; (ii) a magnetic probe

- start ballast with a minimum ballast efficiency of 94 percent; or (iii) a nonpulse

- s tart electronic ballast with

— (I) a minimum ballast efficiency of 92 percent for wattages greater than 250 watts; and (II) a minimum ballast efficiency of 90 percent for wattages less than or equal to 250
watts. (U.S.C

. 629 5 (hh)(1)(A))

In addition to prescribing minimum efficiency requirements for the previously described MH lamp ballasts contained in metal halide lamp fixture s , EISA 2007 amended EPCA to exclude the following types of MH lamp fixtures from the statutorily prescribed energy conservation standards:

(i) fixtures with regulated lag ballasts; (ii) fixtures that use electronic ballasts that operate at 480 volts; or (iii) fixtures that

— (I) are rated only for 150 watt lamps; (II) are rated for use in wet locations, as specified by the National Electrical Code 2002, section 410.4(A); and1

- 4 (III) contain a ballast that is rated to operate at ambient air temperatures above 50 degrees C elsius , as specified by Underwriters Laboratories (UL)1029

– 2001 (“Standard for High

- Intensity

- Discharge Lamp Ballasts”). (42 U.S.C

. 629 5 (hh)(1)(B))

P ursuant to section 310 of EISA 2007, EPCA further directs DOE to incorporate standby mode and off mode energy use in any amended (or new) standard adopted after July 1, 2010. (42 U.S.C. 6295(gg)(3)) Because this energy conservation standards rulemaking mus t be completed by January 1, 2012, the requirement to incorporate standby mode and off mode energy use into the energy conservation standards analysis is applicable.

The following statutory provisions (and associated rulemakings) are related to metal ha lide lamp fixture s but are separate from the current standards rulemaking:

• In conjunction with energy conservation standards for metal halide lamp fixture s, EPCA required DOE to undertake a determination to see if energy conservation standards for High Int ensity Discharge ( HID ) lamps (including MH lamps) would be technologically feasible and economically justified, and would result in significant energy savings. (42 U.S.C

. 6317(a)(1)) DOE completed the HID determination and published a final rule (75 FR 679 75) on July 1, 2010 concluding that energy conservation standards for certain HID lamps are technologically feasible and economically justified.

• DOE completed a test procedure rulemaking for MH lamp ballasts, as required by EPCA through amendments from EIS A 2007. ( 42 U.S.C

. 6293(b)(18)) The final rule test procedure for MH lamp ballasts was published in the Federal Register on March 10, 2010. 75 FR 10950.

• The FTC is directed to conduct a labeling rulemaking as part of the requirements set forth by EISA 2007 for metal halide lamp fixture s.(42 U.S.C. 6294(a)(2)(C)) To this end, the FTC published a final rule in the Federal Register on July 9, 2008, amending 1 6 CFR part 305, “Rule Concerning Disclosures Regarding Energy Consumption and Water Use of Certain Home Appliances and Other Products Required Under the Energy Policy and Conservation Act (‘Appliance Labeling Rule’).” 73 FR 39221. On October 23, 2008, the FTC published in the Federal Register additional amendments to 16 CFR part 305 for metal halide lamp fixture s in the form of technical corrections. 73 FR 63066. Both final rules fulfilled the FTC’s obligations under EISA 2007 pertaining to labeling require ments for metal halide lamp fixture s and MH lamp ballasts.

1.4 PROCESS FOR SETTING ENERGY CONERVATION STANDARDS

DOE considers stakeholder participation a very important part of the standards

- setting
process

. DOE encourages the participation of all stakeholders during the comment period of each rulemaking stage

. Beginning with the r u l emaking framework d ocument for metal halide lamp fixture s ( the f ramework d ocument ) and during subsequent comment periods, interactions among stakeholders provide a balanced discussi on of the information that is required for the standards rulemaking.

In conducting t he energy conservation standard rulemaking , DOE involves stakeholders through formal public notifications (i.e., Federal Register n otices)

. For this MHLF energy1

- 5 conservatio n standards rulemaking, DOE will employ the procedures set forth in DOE’s Process Rule (Procedures for Consideration of New or Revised Energy Conservation Standards for Consumer Products, 61 FR 36974, July 15, 1996, 10 CFR Part 430, Subpart C, Appendix A) to the extent they are appropriate for developing energy conservation standards for the metal halide lamp fixture s covered under this rulemaking.

Before DOE determines whether to establish or amend energy conservation standard s for metal halide lamp fixture s , it must first solicit comments on a proposed standard

. (42 U.S.C. 6295 ( o )( 2 )(B)(i))

. DOE must design each new or amended standard for these products to achieve the maximum improvement in energy efficiency that is technologically feasible and

econ omically justified , and would result in significant energy savings

. (42 U.S.C. 6295(o) (2)(A) and (3)) To determine whether a proposed standard complies with these requirements , DOE
must , after receiving comments on the proposed standard, determine whether the benefits of the standard exceed its burdens to the greatest extent practicable, weighing the seven factors described above.

Subsequent to the publication of the framework document , the standards rulemaking process involves preliminary analyses followed by two additional formal, major public notices, which are published in the Federal Register

. The preliminary analyses are designed to publicly vet the models and tools used in the rulemaking and to facilitate public participation before the proposed rule stage

. After the preliminary analyses are vetted, DOE issues the first major notice, the notice of proposed rulemaking ( NOPR ) , which presents a discussion of comments received in response to the preliminary analyses of the impacts of standards on consumers , manufacturers, and the n ation; DOE’s weighing of the impacts; and the proposed stand ards

. The third notice is the final r ule, which presents a discussion of comments received in response to the NOPR; the revised analysis of the impacts of standards; DOE’ s weighing of the impacts; the standards adopted by DOE; and the effective dates of the standards

.

Table 1.4

. 1 Analyses Under the Process Rule Preliminary Analysi s NOPR Final Rule * Market and technology assessment Revised ANOPR analyses Revised analyses Screening analysis Life

- cycle cost sub

- group analysis Engineering analysis Manufacturer impact analysis Energy use characterization Utility impact analysis Product price determination Employment impact analysis

Life

- cycle cost and payback period analys e s Environmental assessment Shipments analysis Regulatory impact analysis National impact analysis Preliminary manufacturer impact analysis * During the final r ule phase, DOE considers the comments submitted by the U.S. Department of Justice concerning the impact of any lessening of competition that is likely to result from the imposition of the standard. (42 U.S.C. 6295(o)(2)(B)(v))

In December 2009 , DOE published a rulemaking framework d ocument for metal halide lamp fixture s , which describ es the procedural and analytical approaches DOE anticipated using to evaluate the establishment of energy conservation standards for metal halide lamp fixture s

. A1

- 6 PDF copy of the framework d ocument is available at http://www1.eere.energy.gov/buildings/appliance_standards/commercial/pdfs/mh_ecs_framewor k.pdf

DOE held a public meeting on January 26, 2010 (hereafter “ p ublic m eeting”) , to discuss procedural and analytical approaches to the rulemaking, and t o inform and facilitate stakeholders’ involvement in the rulemaking process

. The analytical framework presented at the public meeting described rulemaking analyses, such as the engineering analysis and the LCC and PBP analys e s, the methods proposed for con ducting them, and the relationships among the various analyses

. See Table 1.4

. 1 for all the analyses discussed at the public meeting to be undertaken in each of the formal public rulemaking documents

. PDF copies of the slides and other material associated with the public meeting are available at http://www1.eere.energy.gov/buildings/appliance_standards/commercial/metal_halide_ecs_fram ework_pub_mtg.html

During the p ubl ic m eeting and the framework document comment period, interested parties , including manufacturers, trade associations, environmental advocates

, and other interested parties submitted several comments about the MHLF rulemaking

. The major issues discussed we re : (1) the rulemaking’s scope of coverage; (2) the development of equipment classes; (3) test procedures ; ( 4 ) a system approach and ballast efficiency metric ; ( 5 ) the methodology for the engineering analyses ; (6) life

- cycle cost analysis ; (7) efficiency levels ; and (8) energy savings

. Interested part comments submitted during the framework document comment period elaborated upon the issues raised at the public meeting

. A d etailed discussion of stakeholder comments is available in chapter 2 of this prelimi nary TSD

. As part of the information gathering and sharing process, DOE organized and held interviews with metal halide lamp ballast manufacturer s and fixture manufacturer s who operate in the U.S. MHLF market

. DOE had f ive objectives for these interviews: (1) solicit feedback on the scope of coverage for the rulemaking; ( 2 ) solicit feedback on the engineering analysis (including methodology, prices, and ballast technologies); ( 3 ) solicit feedback on topics related to the pr eliminary manufacturer impact analysis; ( 4 ) provide an opportunity early in the rulemaking process to express specific concerns to DOE; and ( 5 ) foster cooperation between manufacturers and DOE. During the manufacturer interviews, DOE discussed these and ot her issues regarding market data, distribution channels, anticipated consumer responses to standards, production and product mix, conversion costs, and cumulative regulatory burden

. Appendix 12A contains a compl ete copy of the interview guide

.

DOE incorporated the information gathered at the meetings into its engineering analysis ( c hapter 5) and the preliminary manufacturer impact analysis ( c hapter 12)

. Following the publication of the preliminary analysis, DOE intends to hold additional meetings wi th manufacturers as part of the consultative process for the manufacturer impact analysis conducted during the NOPR phase.

For the LCC, PBP and national impact analyses (NIA), DOE developed spreadsheets using Microsoft Excel ®

. The LCC and PBP spreadsheets calculate the economic impacts of replacing products with standard

- compliant ones

. The NIA spreadsheet s calculate the national energy savings (NES) and national net present values (NPVs) at various energy efficiency levels1

- 7 and include a model that forecast s the impacts of energy conservation standards at various levels on product shipments

. These spreadsheets are available on the DOE website at http://www1.eere.energy.gov/buildings/appliance_standards/commercial/metal_halide_lamp_fixt ures.html

1.5 STRUCTURE OF THE DOCUMENT

This preliminary TSD outlines the analytical approaches used in this rulemaking

. The TSD consists of 14 c hapter s , two reports , and appendices.

Chapter 1 Introduction: provides an overview of the appliance standards program and how it applies to the rulemaking for metal halide lamp fixture s , and outlines the structure of the document

Chapter 2 Analytical Framework: d escribes the rulemaking process, provi des an overview of each analysis, and discusses comments received during the framework document public meeting comment period.

Chapter 3 Market and Technology Assessment: characterizes the MHLF market and the technologies available for increasing ballast efficiency and outlines product classes

Chapter 4 Screening Analysis: determines which technology design options are viable for consideration in the engineering analysis

Chapter 5 Engineering Analysis: describes DOE’s approach to the engineering analy sis and discusses how manufacturer costs and selling prices relate to ballast efficiency

Chapter 6 Energy Use Characterization : discusses the sources and methods for developing energy use estimates for metal halide lamp fixture s
Chapter 7 Markups Analys is : discusses the methods DOE used for establishing markups from manufacturer selling price to installed customer prices.

Chapter 8 LCC and PBP Analys e s: discusses the economic effects of standards and compares the LCC and PBP of metal halide lamp fixtu re s with and without higher energy conservation standards

Chapter 9 Shipments Analysis: discusses the methods used for forecasting shipments with and without higher energy conservation standards

Chapter 10 National Impact Analysis: describes the nation al forecast of energy consumption, efficiency of new metal halide lamp fixture s , and annual MHLF sales in the absence or presence of new standards1

- 8 Chapter 11 Life

- Cycle Cost Sub

- Group Analysis: discusses the methods to be used to study the effect s of sta ndards on a subgroup of MHLF

consumers a nd compares the LCC and PBP of product with and without higher efficiency standards for these consumers

Chapter 12 Manufacturer Impact Analysis: discusses the methods to be used to study the effects of standards on the finances and profitability of metal halide lamp fixture s , and presents preliminary manufacturer impact analysis results

Chapter 13 Utility Impact Analysis: discusses the methods to be used to study the effects of standards on electric utilities

Chapter 14 Employment Impact Analysis: discusses the methods to be used to analyze the effects of standards on national employment

Chapter 15 Environmental Assessment for metal halide lamp fixture s : discusses the methods to be used to study the effects of standards on two pollutants, sulfur dioxide (SO 2 ) and nitrogen oxides (NOx), as well as carbon emissions

Chapter 16 Regulatory Impact Analysis for metal halide lamp fixture s : discusses the methods to be used to determine the impact of non

- regulatory alternatives to energy conservation standards

Appendix 3A U.S. Code and Code of Federal Regulations

Appendix 5A Test Data for metal halide lamp fixture s : lists the test data used for the MHLF engineering analysis

Appendix 8A User Instructions for Life

- Cycle Cost and Payback Period Spreadsheet

Appendix 10A User Instructions for Shipments and NIA Spreadsheet

Appendix 12A Preliminary Manufacturer Interview Guide

Appendix EA

- SCC Social Cost of Carbon for Regulatory Impact Analy sis Under Executive Order 12866