U.S. DEPARTMENT OF ENERGY

OFFICE OF ENERGY EFFICIENCY AND RENEWABLE ENERGY

PUBLIC WORKSHOP ON

POSSIBLE IMPACTS OF ENERGY EFFICIENCY STANDARDS FOR

FLUORESCENT LAMP BALLASTS

FORRESTAL BUILDING

WASHINGTON, DC

APRIL 28, 1998

1

EE-RM-97-500 COMMENT 21OO

u.s .. DEPARTMENT OF ENERGY 

OFFICE OF ENERGY EFFICIENCY AND RENEWABLE ENERGY 

PUBLIC WORKSHOP ON 

POSSIBLE IMPACTS OF ENERGY EFFICIENCY STANDARDS FOR 

FLUORESCENT LAMP BALLASTS 

FORRESTAL BUILDING 

WASHINGTON, DC 

APRIL 28, 1998 

1 

u.s .. DEPARTMENT OF ENERGY 

OFFICE OF ENERGY EFFICIENCY AND RENEWABLE ENERGY 

PUBLIC WORKSHOP ON 

POSSIBLE IMPACTS OF ENERGY EFFICIENCY STANDARDS FOR 

FLUORESCENT LAMP BALLASTS 

FORRESTAL BUILDING 

WASHINGTON, DC 

APRIL 28, 1998 

1 
MODERATOR:

Douglas Brookman, Brookman-King:

We have had a few changes in the Staffing in the Office of Codes and Standards,

and because of that we are going to do a slight change to the agenda and then

Michael McCabe is going to start off with the opening remarks.

WELCOMING REMARKS AND INTRODUCTIONS:

Michael McCabe, Director, Office of Codes and Standards, DoE:

Good morning, I am Michael McCabe. I am the Director of DoE's Office of Codes and

Standards. One of the things we are trying to do with the process is to make the meeting

as open as possible. With the number of people sitting in the back, a number of you may

have valuable insight into this process, because in the past when we had people sitting in

the back it has been very difficult to provide input. I invite anybody who would like to

move up please free. I would like to welcome everybody to todays workshop. This is one

in a series of workshops, public meetings, that we've had with interested parties on the

applications of ballast standards. We have had a significant change of Staff, so I've

been asked to introduce Carl Adams. Carl will be the Team Leader for this rule

making. He will introduce in his remarks the other member of the team. Anthony

Balducci who had been leading us is about to leave the Department, and so at this point in

time felt it was appropriate for Carl to lead the workshop. There will be some questions

as far as history and background that we may have to struggle through, but with I think

Carl's involvement and the briefing he has received and others who have been involved in

the process who will be introduced later will be able to fill in the blanks for him and for

me. Again this process we are having today, the workshop, has evolved, as designed

not to be a workshop where we had an auxiliary paradigm, we've had DoE Staff and

Contractors Staff, sitting at the head table and had individuals come up speaking one at

time to the panel who gave questions back. What we encourage is an open exchange of

information, ideas, and opinions on topic that have been identified; and also for you to

2

EE-RM-97-500 COMMENT 21OO

MODERATOR: 

Douglas Brookman, Brookman-King: 

We have had a few changes in the Staffing in the Office of Codes and Standards, 

and because of that we are going to do a slight change to the agenda and then 

Michael McCabe is going to start off with the opening remarks. 

WELCOMING REMARKS AND INTRODUCTIONS: 

Michael McCabe, Director, Office of Codes and Standards, DoE: 

Good morning, I am Michael McCabe. I am the Director of DoE's Office of Codes and 

Standards. One of the things we are trying to do with the process is to make the meeting 

as open as possible. With the number of people sitting in the back, a number of you may 

have valuable insight into this process, because in the past when we had people sitting in 

the back it has been very difficult to provide input. I invite anybody who would like to 

move up please free. I would like to welcome everybody to to days workshop. This is one 

in a series of workshops, public meetings, that we've had with interested parties on the 

applications of ballast standards. We have had a significant change of Staff, so I've 

been asked to introduce Carl Adams. Carl will be the Team Leader for this rule 

making. He will introduce in his remarks the other member of the team. Anthony 

Balducci who had been leading us is about to leave the Department, and so at this point in 

time felt it was appropriate for Carl to lead the workshop. There will be some questions 

as far as history and background that we may have to struggle through, but with I think 

Carl's involvement and the briefing he has received and others who have been involved in 

the process who will be introduced later will be able to fill in the blanks for him and for 

me. Again this process we are having today, the workshop, has evolved, as designed 

not to be a workshop where we had an auxiliary paradigm, we've had DoE Staff and 

Contractors Staff, sitting at the head table and had individuals come up speaking one at 

time to the panel who gave questions back. What we encourage is an open exchange of 

information, ideas, and opinions on topic that have been identified; and also for you to 

2 

MODERATOR: 

Douglas Brookman, Brookman-King: 

We have had a few changes in the Staffing in the Office of Codes and Standards, 

and because of that we are going to do a slight change to the agenda and then 

Michael McCabe is going to start off with the opening remarks. 

WELCOMING REMARKS AND INTRODUCTIONS: 

Michael McCabe, Director, Office of Codes and Standards, DoE: 

Good morning, I am Michael McCabe. I am the Director of DoE's Office of Codes and 

Standards. One of the things we are trying to do with the process is to make the meeting 

as open as possible. With the number of people sitting in the back, a number of you may 

have valuable insight into this process, because in the past when we had people sitting in 

the back it has been very difficult to provide input. I invite anybody who would like to 

move up please free. I would like to welcome everybody to to days workshop. This is one 

in a series of workshops, public meetings, that we've had with interested parties on the 

applications of ballast standards. We have had a significant change of Staff, so I've 

been asked to introduce Carl Adams. Carl will be the Team Leader for this rule 

making. He will introduce in his remarks the other member of the team. Anthony 

Balducci who had been leading us is about to leave the Department, and so at this point in 

time felt it was appropriate for Carl to lead the workshop. There will be some questions 

as far as history and background that we may have to struggle through, but with I think 

Carl's involvement and the briefing he has received and others who have been involved in 

the process who will be introduced later will be able to fill in the blanks for him and for 

me. Again this process we are having today, the workshop, has evolved, as designed 

not to be a workshop where we had an auxiliary paradigm, we've had DoE Staff and 

Contractors Staff, sitting at the head table and had individuals come up speaking one at 

time to the panel who gave questions back. What we encourage is an open exchange of 

information, ideas, and opinions on topic that have been identified; and also for you to 

2 
identify other topics that you would like to address. Doug Brookman will be facilitating

today's meeting and Carl will be going over the agenda. We had shared that

approximately a month ago after had some dialog with a number of parties about the

issues. So we hope that the agenda is complete. The topics that are identified, are those

certainly that we want to address and believe they are the ones that those that we dealing

with would like addressed as well. I do not profess that it includes everything that may

come up. So we encourage those who have issues, have questions, please raise them.

We will try to deal with them to the extent that we and you are capable of doing today.

I would like to again welcome everybody.

Carl Adams:

Well good morning again. I am Carl Adams, the new Team Leader for the lamp

ballast standards rulemaking and I am also the presiding official for today's workshop,

The other members of the team for the lamp ballast rulemaking are: Barbara Twigg and

Barry Berlin both from the Office of Codes and Standards; Eugene Margolis from the

Office of the General Counsel; and Mark Friedrichs from the Office of Policy and

International Affairs. On behalf of the Department of Energy, I would like to thank all of

you for taking the time to participate in this workshop. Copies of the slides that will be

used today are available at the front desk. See Brenda or Sandy if you don't have a copy

of them. Also available are copies of the documents that were referenced in the Federal

Register notice and are also on the Office of Codes and Standards home page at:

www.eren.doe.gov/buildings/codes_standards/notices. Anyone attending today's

workshop or anyone who submitted comments will be added to our mailing list for future

mailings. The Department of Energy is required by statue to establish energy conservation

standards for fluorescent lamp ballasts which are designed to achieve the maximum

improvement in energy efficiency which the Secretary determines is techonologically

feasible and economically justified. This rulemaking was to have been completed in 1992.

Obviously we are way behind schedule. The comments received here today and those

3

EE-RM-97-500 COMMENT 21OO

identify other topics that you would like to address. Doug Brookman will be facilitating 

today's meeting and Carl will be going over the agenda. We had shared that 

approximately a month ago after had some dialog with a number of parties about the 

issues. So we hope that the agenda is complete. The topics that are identified, are those 

certainly that we want to address and believe they are the ones that those that we dealing 

with would like addressed as well. I do not profess that it includes everything that may 

come up. So we encourage those who have issues, have questions, please raise them. 

We will try to deal with them to the extent that we and you are capable of doing today. 

I would like to again welcome everybody. 

Carl Adams: 

Well good morning again. I am Carl Adams, the new Team Leader for the lamp 

ballast standards rulemaking and I am also the presiding official for today's workshop, 

The other members of the team for the lamp ballast rulemaking are: Barbara Twigg and 

Barry Berlin both from the Office of Codes and Standards; Eugene Margolis from the 

Office of the Genera] Counsel; and Mark Friedrichs from the Office of Policy and 

International Affairs. On behalf of the Department of Energy, I would like to thank all of 

you for taking the time to participate in this workshop. Copies of the slides that will be 

used today are available at the front desk. See Brenda or Sandy if you don't have a copy 

of them. Also available are copies of the documents that were referenced in the Federal 

Register notice and are also on the Office of Codes and Standards home page at: 

www.eren.doe.govlbuildings/codes_standards/notices. Anyone attending today's 

workshop or anyone who submitted comments will be added to our mailing list for future 

mailings. The Department of Energy is required by statue to establish energy conservation 

standards for fluorescent lamp ballasts which are designed to achieve the maximum 

improvement in energy efficiency which the Secretary determines is techonologically 

feasible and economically justified. This rulemaking was to have been completed in 1992. 

Obviously we are way behind schedule. The comments received here today and those 

3 

identify other topics that you would like to address. Doug Brookman will be facilitating 

today's meeting and Carl will be going over the agenda. We had shared that 

approximately a month ago after had some dialog with a number of parties about the 

issues. So we hope that the agenda is complete. The topics that are identified, are those 

certainly that we want to address and believe they are the ones that those that we dealing 

with would like addressed as well. I do not profess that it includes everything that may 

come up. So we encourage those who have issues, have questions, please raise them. 

We will try to deal with them to the extent that we and you are capable of doing today. 

I would like to again welcome everybody. 

Carl Adams: 

Well good morning again. I am Carl Adams, the new Team Leader for the lamp 

ballast standards rulemaking and I am also the presiding official for today's workshop, 

The other members of the team for the lamp ballast rulemaking are: Barbara Twigg and 

Barry Berlin both from the Office of Codes and Standards; Eugene Margolis from the 

Office of the Genera] Counsel; and Mark Friedrichs from the Office of Policy and 

International Affairs. On behalf of the Department of Energy, I would like to thank all of 

you for taking the time to participate in this workshop. Copies of the slides that will be 

used today are available at the front desk. See Brenda or Sandy if you don't have a copy 

of them. Also available are copies of the documents that were referenced in the Federal 

Register notice and are also on the Office of Codes and Standards home page at: 

www.eren.doe.govlbuildings/codes_standards/notices. Anyone attending today's 

workshop or anyone who submitted comments will be added to our mailing list for future 

mailings. The Department of Energy is required by statue to establish energy conservation 

standards for fluorescent lamp ballasts which are designed to achieve the maximum 

improvement in energy efficiency which the Secretary determines is techonologically 

feasible and economically justified. This rulemaking was to have been completed in 1992. 

Obviously we are way behind schedule. The comments received here today and those 

3 
submitted during the written comment period will assist the Department in developying

the notice of proposed rulemaking which is now planned for February 1999. The following

are procedural items which most of you are aware of. However, this being a Federal

proceeding I am required to read this. So, pay attention because there may be a quiz.

Doug Brookman will be facilitating the workshop and will be setting the guidelines

for conducting the workshop and providing other pertinent information. In approximately

two weeks, a complete copy of the transcript will be available for inspection and copying

at the Department of Energy's Freedom of Information reading room, located down the

hall in Room 1E-190. Anyone wishing to purchase a copy of the transcript may make

arrangements with the court reporter. To provide the Department with as much pertinent

information and as many views as can be reasonable obtained, and to enable interested

persons to express their views, the workshop will be conducted in accordance with the

following procedures: The focus of this workshop is for the Department to listen to

comments pertaining to the inputs to the Life Cycle Cost, National Energy Impacts and

Utility/Enviromnental Analysis sections of the Technical Support Document and the

methodology for conducting the Manufacturer Impact Analysis to be utilized in the

Technical Support Document to support the proposed rule for fluorescent lamp

ballasts. We will begin with introductions, then discuss the agenda and expand on the

agenda it necessary to provide everyone with an opportunity to discuss their topic. DoE

topics will remain on the agenda as lead presentations in their respective areas.

We'll take an hour lunch break at a convenient time near 12 noon which is on

your own. There is a snack bar one floor below us. There is the DoE cafeteria on the

second floor of the west building, and a number of restaurants in the underground mall at

L'Enfant Plaza up the street. It will reduce interruptions if everyone who wants to speak

waits to be recognized. Please remember to speak into the microphones, especially those

in the audience, and state your name and your company each time before you speak for

the court reporter.

4

EE-RM-97-500 COMMENT 21OO

submitted during the written comment period will assist the Department in developying 

the notice of proposed rulemaking which is now planned for February 1999. The following 

are procedural items which most of you are aware of However, this being a Federal 

proceeding I am required to read this. So, pay attentibn because there may be a quiz. 

Doug Brookman will be facilitating the workshop and will be setting the guidelines 

for conducting the workshop and providing other pertinent information. In approximately 

two weeks, a complete copy of the transcript will be available for inspection and copying 

at the Department of Energy's Freedom ofInformation reading room, located down the 

hall in Room lE-190. Anyone wishing to purchase a copy of the transcript may make 

arrangements with the court reporter. To provide the Department with as much pertinent 

information and as many views as can be reasonable obtained, and to enable interested 

persons to express their views, the workshop will be conducted in accordance with the 

fo!low::ng ,rocedures: The focus oft.his workshop is for the Department to listen to 

comments pertaining to the inputs to the Life Cycle Cost, National Energy Impacts and 

UtilitylEnvirorunental Analysis sections of the Technical Support Document and the 

methodology for conducting the Manufacturer Impact Analysis to be utilized in the 

Technical Support Document to support the proposed rule for fluorescent lamp 

ballasts. We will begin with introductions, then discuss the agenda and expand on the 

agenda if necessary to provide every~me with an opportunity to discuss their topic. DoE 

topics will remam on the agenda as lead presentations in their respective areas. 

We'll take an hour lunch break at a convenient time near 12 noon which is on 

your own. There is a snack bar one floor below us. There is the DoE cafeteria on the 

second floor of the west building, and a number of restaurants in the underground mall at 

L'Enfant Plaza up the street. It will reduce interruptions if everyone who wants to speak 

waits to be recognized. Please remember to speak into the microphones, especially those 

in the audience, and state your name and your company each time before you speak for 

the court reporter. 

4 

submitted during the written comment period will assist the Department in developying 

the notice of proposed rulemaking which is now planned for February 1999. The following 

are procedural items which most of you are aware of However, this being a Federal 

proceeding I am required to read this. So, pay attentibn because there may be a quiz. 

Doug Brookman will be facilitating the workshop and will be setting the guidelines 

for conducting the workshop and providing other pertinent information. In approximately 

two weeks, a complete copy of the transcript will be available for inspection and copying 

at the Department of Energy's Freedom ofInformation reading room, located down the 

hall in Room lE-190. Anyone wishing to purchase a copy of the transcript may make 

arrangements with the court reporter. To provide the Department with as much pertinent 

information and as many views as can be reasonable obtained, and to enable interested 

persons to express their views, the workshop will be conducted in accordance with the 

fo!low::ng ,rocedures: The focus oft.his workshop is for the Department to listen to 

comments pertaining to the inputs to the Life Cycle Cost, National Energy Impacts and 

UtilitylEnvirorunental Analysis sections of the Technical Support Document and the 

methodology for conducting the Manufacturer Impact Analysis to be utilized in the 

Technical Support Document to support the proposed rule for fluorescent lamp 

ballasts. We will begin with introductions, then discuss the agenda and expand on the 

agenda if necessary to provide every~me with an opportunity to discuss their topic. DoE 

topics will remam on the agenda as lead presentations in their respective areas. 

We'll take an hour lunch break at a convenient time near 12 noon which is on 

your own. There is a snack bar one floor below us. There is the DoE cafeteria on the 

second floor of the west building, and a number of restaurants in the underground mall at 

L'Enfant Plaza up the street. It will reduce interruptions if everyone who wants to speak 

waits to be recognized. Please remember to speak into the microphones, especially those 

in the audience, and state your name and your company each time before you speak for 

the court reporter. 

4 
Side conversations should be kept to a minimum to avoid interrupting the presenter; if a

lengthy discussion is needed, please move to a corner of the room or out of the room. It

may be necessary to cut off debate on some topics to maintain the schedule. There may be

time at the end of the workshop for additional discussions of significant issues. I

encourage all persons present to participate as much as possible so that the Department

may get a full spectrum of opinion on these topics. This workshop is scheduled to end by

5 p.m. today. Topics which have not been completely discussed can be addressed in

written comments. The deadinr; fcr written comments and data submissions following t

his workshop will be determined based on responses received today. Although I will be

shooting for a thirty day comment period. So, please keep that in mind as we go through.

All comments and data submitted wi l be considered before DoE publishes the notice

of proposed rulemaking. All written comments and data submissions will be available for

public inspection at the DoE "Freedom of Information Reading Room. Phone number

(202) 586-6020. Written comments should be addressed to the Department of Energy as

noted in the Federal Register notice for today's workshop. Ten copies of the documents

or data are requested. In addition, the Department would appreciate an electronic copy of

the comments or data. The Department is using WordPerfect 6.1. No faxed comments

will be accepted. Any persons submitting information which he or she believes to be

confidential and exempt by law from public disclosure should submit one complete copy

and ten copies from which information claimed to be confidential has been deleted.

In accordance with the procedures established at 1 OCFR 1004.11, the Department of

Energy shall make its own determinations as to whether the information shall be exempt

from public disclosure. In keeping with the regulations of these facilities, there is no

smoking allowed in this room or building . The restrooms are down the hall to your left

and right. Phones are located in the main lobby area. Again, we appreciate the time and

effort you have taken in preparing for this workshop, and are please to receive your

5

EE-RM-97-500 COMMENT 21OO

Side conversations should be kept to a minimum to avoid interrupting the presenter; if a 

lengthy discussion is needed, please move to a comer of the room or out of the room. It 

may be necessary to cut off debate on some topics to maintain the schedule. There may be 

time at the end of the workshop for additional discussions of significant issues. I 

encourage all persons present to participate as much as possible so that the Department 

may get a full spectrum of opinion on these topics. This workshop is scheduled to end by 

5 p.m. today. Topics whicn have not been completely discussed can be addressed in 

written comments. The deadline fer written comments and data submissions following t 

his workshop will be determined based on responses received today. Although I will be 

shooting for a thirty day comment period. So, please keep that in mind as we go through. 

All comments and data submitted wiil be considered before DoE publishes the notice 

of proposed rulemaking. All written comments and data submissions will be available for 

public inspection at the DoE Freedom ofInformation Reading Room. Phone number 

(202) 586-6020. Written comments should be addressed to the Department of Energy as 

noted in the Federal Register notice for today's workshop. Ten copies of the documents 

or data are requested. In addition, the Department would appreciate an electronic copy of 

the comments or data. The Department is using WordPerfect 6.1. No faxed comments 

will be accepted, Any persons submitting information which he or she believes to be 

confidential and exempt by iaw from public disclosure should submit one complete copy 

and ten copies from which information claimed to be confidential has been deleted. 

In accordance with the procedures established at 10CFR 1004.11, the Department of 

Energy shall make its own determinations as to whether the information shall be exempt 

from public disclosure. In keeping with the regulations of these facilities, there is no 

smoking allowed in this room or building. The restrooms are down the hall to your left 

and right. Phones are located in the main lobby area. Again, we appreciate the time and 

effort you have taken in preparing for this workshop, and are please to receive your 

5 

Side conversations should be kept to a minimum to avoid interrupting the presenter; if a 

lengthy discussion is needed, please move to a comer of the room or out of the room. It 

may be necessary to cut off debate on some topics to maintain the schedule. There may be 

time at the end of the workshop for additional discussions of significant issues. I 

encourage all persons present to participate as much as possible so that the Department 

may get a full spectrum of opinion on these topics. This workshop is scheduled to end by 

5 p.m. today. Topics whicn have not been completely discussed can be addressed in 

written comments. The deadline fer written comments and data submissions following t 

his workshop will be determined based on responses received today. Although I will be 

shooting for a thirty day comment period. So, please keep that in mind as we go through. 

All comments and data submitted wiil be considered before DoE publishes the notice 

of proposed rulemaking. All written comments and data submissions will be available for 

public inspection at the DoE Freedom ofInformation Reading Room. Phone number 

(202) 586-6020. Written comments should be addressed to the Department of Energy as 

noted in the Federal Register notice for today's workshop. Ten copies of the documents 

or data are requested. In addition, the Department would appreciate an electronic copy of 

the comments or data. The Department is using WordPerfect 6.1. No faxed comments 

will be accepted, Any persons submitting information which he or she believes to be 

confidential and exempt by iaw from public disclosure should submit one complete copy 

and ten copies from which information claimed to be confidential has been deleted. 

In accordance with the procedures established at 10CFR 1004.11, the Department of 

Energy shall make its own determinations as to whether the information shall be exempt 

from public disclosure. In keeping with the regulations of these facilities, there is no 

smoking allowed in this room or building. The restrooms are down the hall to your left 

and right. Phones are located in the main lobby area. Again, we appreciate the time and 

effort you have taken in preparing for this workshop, and are please to receive your 

5 
comments and opinions. At this time, I would like to turn it over to Doug Brookman to

begin the introductions, and then we'll go to the agenda review.

Doug Brookman:

Good morning, again. I am Doug Brookman. Nice to see so many of you back

and for those of you are new, especially welcome you for this first time.

We are accustom of having everybody introduce themselves and so will do that.

[Attendees introduced themselves indicating their company or department]

Mike Rivest, Arthur D. Little, Inc.

Quentin L%)one , Arthur D. Little, Inc.

Isaac Turiel, Lawrence Berekely National Laboratory

Valeria Whelan, Nature Resource of Canada

Barbara Atkinson, Lawrence Berekely National Laboratory

Bill Black, Copper Development Associates, Inc.

Gene Foley, Allinance to Save Energy

Richard Rattray, OSRAM Sylvania

Howard Wolfman,lVotorola Lighting, Inc.

Edwin Brush, BBF & Associates

Patricia Franco, Philips Electronics

Robert Pelino, Transformer Company

Jerry Prideaux, Powerlighting Products, Inc.

Tom Schooler, Powerlighting Products, Inc.

Norm Grimshaw, Advance Transformer, Inc.

Bob Wisbey, Advance Transformer, Inc.

Mike Stein, MagneTek, Inc.

Mark Perlis, Dickstein Shapiro Morin & Oshinsky

Barry Berlin, Department of Energy

Eugene Margolis, Counsel for the Program, DoE

6

EE-RM-97-500 COMMENT 21OO

comments and opinions. At this time, I would like to turn it over to Doug Brookman to 

. begin the introductions, and then we'll go to the agenda review. 

Doug Brookman: 

Good morning, again. I am Doug Brookman. Nice to see so many of you back 

and for those of you are new, especially welcome you for this first time. 

We are accustom of having everybody introduce themselves and so will do that. 

[Attendees introduced themselves indicating their company or department] 

Mike Rivest, Arthur D. Little, Inc. 

Quentin Loone~, Arthur D. Little, Inc. 

Isaac Turiel, Lawrence Berekely National Laboratory 

Valeria Whelan, Nature Resource of Canada 

Barbara Atkinson, Lawrence Berekely National Laboratory 

Bill Black, Copper Development Associates, Inc. 

Gene Foley, Allinance to Save Energy 

Richard Rattray, OSRAM Sylvama 

Howard WoIiinan, Motorola Lighting, Inc. 

Edwin Brush, BBF & Associates 

Patricia Franco, Philips Electronics 

Robert Pelino, Transformer Company 

Jerry Prideaux, Powerlighting Products, Inc. 

Tom Schooler, Powerlighting Products, Inc. 

Norm Grimshaw, Advance Transformer, Inc. 

Bob Wisbey, Advance Transformer, Inc. 

Mike Stein, MagneTek, Inc. 

Mark Perlis, Dickstein Shapiro Morin & Oshinsky 

Barry Berlin, Department of Energy 

Eugene Margolis, Counsel for the Program, DoE 

6 

comments and opinions. At this time, I would like to turn it over to Doug Brookman to 

. begin the introductions, and then we'll go to the agenda review. 

Doug Brookman: 

Good morning, again. I am Doug Brookman. Nice to see so many of you back 

and for those of you are new, especially welcome you for this first time. 

We are accustom of having everybody introduce themselves and so will do that. 

[Attendees introduced themselves indicating their company or department] 

Mike Rivest, Arthur D. Little, Inc. 

Quentin Loone~, Arthur D. Little, Inc. 

Isaac Turiel, Lawrence Berekely National Laboratory 

Valeria Whelan, Nature Resource of Canada 

Barbara Atkinson, Lawrence Berekely National Laboratory 

Bill Black, Copper Development Associates, Inc. 

Gene Foley, Allinance to Save Energy 

Richard Rattray, OSRAM Sylvama 

Howard WoIiinan, Motorola Lighting, Inc. 

Edwin Brush, BBF & Associates 

Patricia Franco, Philips Electronics 

Robert Pelino, Transformer Company 

Jerry Prideaux, Powerlighting Products, Inc. 

Tom Schooler, Powerlighting Products, Inc. 

Norm Grimshaw, Advance Transformer, Inc. 

Bob Wisbey, Advance Transformer, Inc. 

Mike Stein, MagneTek, Inc. 

Mark Perlis, Dickstein Shapiro Morin & Oshinsky 

Barry Berlin, Department of Energy 

Eugene Margolis, Counsel for the Program, DoE 

6 
Carl Adams, Office of Codes & Standards, DoE

Michael McCabe, Office of Codes & Standards, DoE

Stephen Treado, NIST

Barbara Twigg, DoE

Virginia Allen, Flexiwatt, LLC.

Eugene Andert, Rae Magnet Wire Company

Gerald Beatty, LTV Steel Company

David Bender, Copper Development Associates, Inc.

Larry Clark, Optic Sales, Inc.

Tom Eckman, Nortwest Power Planning Council

Diane Fisher, Lawrence Berekely National Laboratory

Craig Davenport, Intertex Testing Service

Wayne Causey, Howard Industries, Inc.

Ric Erdheim, National Electrical manufacturers Association

John Forseyth, Texas Instruments, Inc.

Gregory Gerber, Texas Instruments, Inc.

Thomas Hagen, T&J Enterprises, Inc.

Dennis Kurowski, LTV Steel Company, Inc.

Roy Jones, Texas Instruments, Inc.

Ed Psamm. American Council for an Energy-Efficient Economy

Joe Mohr, Advance Transformer

Mohit Pande, Arthur D. Little, Inc.

Mike Martin, California Energy Commission

Diane Moorefield, PEPCO

Herb Rice, Steiner-Group

Steve Rosenstock, Edison Electric Institute

Anthony Von Holle, Armco Inc.

7

EE-RM-97-500 COMMENT 21OO

Carl Adams, Office of Codes & Standards, DoE 

Michael McCabe, Office of Codes & Standards, DoE 

Stephen Treado, NIST 

Barbara Twigg, DoE 

Virginia Allen, Flexiwatt, LLC. 

Eugene Andert, Rae Magnet Wire Company 

Gerald Beatty, LTV Steel Company 

David Bender, Copper Development Associates, Inc. 

Larry Clark, Optic Sales, Inc. 

Tom Eckman, Nortwest Power Planning Council 

Diane Fisher, Lawrence Berekely National Laboratory 

Craig Davenport, Intertex Testing Service 

Wayne Causey, Howard Industries, Inc. 

Ric Erdheim, National Electrical manufacturers Association 

John Forseyth, Texas Instruments; InG. 

Gregory Gerber, Texas Instruments, Inc. 

Thomas Hagen, T &J Enterprises, Inc. 

Dennis Kurowski, LTV Steel Company, Inc. 

Roy Jones, Texas Instruments, Inc. 

Ed Psamm. American Council for an Energy-Efficient Economy 

Joe Mohr, Advance Transformer 

Mohit Pande, Arthur D. Little, Inc. 

Mike Martin, California Energy Commission 

Diane Moorefield, PEPCO 

Herb Rice, Steiner-Group 

Steve Rosenstock, Edison Electric Institute 

Anthony Von Holle, Armco Inc. 

7 

Carl Adams, Office of Codes & Standards, DoE 

Michael McCabe, Office of Codes & Standards, DoE 

Stephen Treado, NIST 

Barbara Twigg, DoE 

Virginia Allen, Flexiwatt, LLC. 

Eugene Andert, Rae Magnet Wire Company 

Gerald Beatty, LTV Steel Company 

David Bender, Copper Development Associates, Inc. 

Larry Clark, Optic Sales, Inc. 

Tom Eckman, Nortwest Power Planning Council 

Diane Fisher, Lawrence Berekely National Laboratory 

Craig Davenport, Intertex Testing Service 

Wayne Causey, Howard Industries, Inc. 

Ric Erdheim, National Electrical manufacturers Association 

John Forseyth, Texas Instruments; InG. 

Gregory Gerber, Texas Instruments, Inc. 

Thomas Hagen, T &J Enterprises, Inc. 

Dennis Kurowski, LTV Steel Company, Inc. 

Roy Jones, Texas Instruments, Inc. 

Ed Psamm. American Council for an Energy-Efficient Economy 

Joe Mohr, Advance Transformer 

Mohit Pande, Arthur D. Little, Inc. 

Mike Martin, California Energy Commission 

Diane Moorefield, PEPCO 

Herb Rice, Steiner-Group 

Steve Rosenstock, Edison Electric Institute 

Anthony Von Holle, Armco Inc. 

7 
John Wells, WorkSmart Energy Enterprises, Inc.

Ed Yandek, General Electric Company

John Yodis, The P.D. Geroge Company

James Giarrusso, United Tool & Stamping Company

John Giarrusso, Jr., United Tool & Stamping Company

Glenn Scltleede, Energy Market & Policy Analysis, Inc.

Sayed Azimi, Energetics

Raemond Beebe, Phelps Dodge Industries Company

Rolland Jones, Jr. Bolmet, Inc.

Randall Moorhead, Philips Electronics Corporation

Kyle Pltsor, National Electrical Manufacturers Association

Paul Santuzzi, WCI Steel, Inc.

Todd Straka, Interek Testing Service

Tim Treacy, Inland Steel Company

Earl Sherman, ISO

John Bauer, ARMCO Inc.

Patrick Kelly, USX Corporation

Thank you. Did anybody not get a chance to introduce themselves? Everybody

knows Sandy and Brenda. Everybody. Let me welcome and thank you again. Thank you

all for being on time, so we could start on time. We have a full agenda for today.

About two years ago when we started process improvement. Was it longer than

that? In that range, we started off meetings like this with ground rules and overtime they

emerged as NORMS, characterized as NORMS, the way this group and other that

preceded it the way we come to expect to have here today. And simply it would be we

ask individuals to speak one at a time. Please say your name for the record. Be concise.

There's a lot to be said on all of these topics and you need to be mindful of sharing the air

8

EE-RM-97-500 COMMENT 21OO

John Wells, WorkSmart Energy Enterprises, Inc. 

Ed Yandek, General Electric Company 

John Yo dis, The P.D. Geroge Company 

James Giarrusso, United Tool & Stamping Company 

John Giarrusso, Jr., United Tool & Stamping Company 

Glenn Scltleede, Energy Market & Policy Analysis, Inc. 

Sayed Azimi, Energetics 

Raemond Beebe, Phelps Dodge Industries Company 

Rolland Jones, Jr. Bolmet, Inc. 

Randall Moorhead, Philips Electronics Corporation 

Kyle Pltsor, National Electrical Manufacturers Association 

Paul Santuzzi, WCI Steel, Inc. 

Todd Straka, Interek Testing Service 

Tim Treacy, Inland Steel Company 

Earl Sherman, ISO 

John Bauer, ARMCO Inc. 

Patrick Kelly, USX Corporation 

Thank you. Did anybody not get a chance to introduce themselves? Everybody 

knows Sandy and Brenda. Everybody. Let me welcome and thank you again. Thank you 

all for being on time, so we could start on time. We have a full agenda for today. 

About two years ago when we started process improvement. Was it longer than 

that? In that range, we started off meetings like this with ground rules and overtime they 

emerged as NORMS, characterized as NORMS, the way this group and other that 

preceded it the way we come to expect to have here today. And simply it would be we 

ask individuals to speak one at a time. Please say your name for the record. Be concise. 

There's a lot to be said on all ofthese topics and you need to be mindful of sharing the air 

8 

John Wells, WorkSmart Energy Enterprises, Inc. 

Ed Yandek, General Electric Company 

John Yo dis, The P.D. Geroge Company 

James Giarrusso, United Tool & Stamping Company 

John Giarrusso, Jr., United Tool & Stamping Company 

Glenn Scltleede, Energy Market & Policy Analysis, Inc. 

Sayed Azimi, Energetics 

Raemond Beebe, Phelps Dodge Industries Company 

Rolland Jones, Jr. Bolmet, Inc. 

Randall Moorhead, Philips Electronics Corporation 

Kyle Pltsor, National Electrical Manufacturers Association 

Paul Santuzzi, WCI Steel, Inc. 

Todd Straka, Interek Testing Service 

Tim Treacy, Inland Steel Company 

Earl Sherman, ISO 

John Bauer, ARMCO Inc. 

Patrick Kelly, USX Corporation 

Thank you. Did anybody not get a chance to introduce themselves? Everybody 

knows Sandy and Brenda. Everybody. Let me welcome and thank you again. Thank you 

all for being on time, so we could start on time. We have a full agenda for today. 

About two years ago when we started process improvement. Was it longer than 

that? In that range, we started off meetings like this with ground rules and overtime they 

emerged as NORMS, characterized as NORMS, the way this group and other that 

preceded it the way we come to expect to have here today. And simply it would be we 

ask individuals to speak one at a time. Please say your name for the record. Be concise. 

There's a lot to be said on all ofthese topics and you need to be mindful of sharing the air 

8 
time as much as you can. Listen as an ally. The better the listening, the better the quality

of the discourse I find. The listening proceeds the (not audible) The more we adhere to

that as a standard, the better off we are going to be. There are no dumb questions in this

room today. Not a single one. And we want to encourage questions. We want to the

exchange of information. And, I will be recognizing people to speak. I will try to keep it

moving as fast as possible. I will ask for your consideration. I will be cueing people

to speak. So, I am going to try also at my (not audible) to allow people to kind of

jump into the cue and make certain comments. If those comments are not short, you will

not be recognized again for another. I do want to keep this dynamic, but I want to be fair

and let everybody speak. You understand the dilemma there. That's what I am trying to

do up here. So, that's the basic thing that I am trying to achieve. All of you I believe

received a copy of the agenda. I am going to review now for those of you who wish to

follow along with me. That's a very brief status update on the standards program. Follow

these introductions and this agenda review. And then moving on to page two, we get into

the subsistent aspects of the workshop today. Input to the technical support document

specifically Life Cycle Cost Analysis. And you can see the subelements that will be

described there. The basic format for these workshops tends to be brief presentation,

billeted presentation followed by Q and A and discussion. So after Life Cycle Cost

Analysis, mid-morning in there sometime, when it is appropriate we will take a break.

But we will keep pressing on until mid morning if we can. That is if we will keep working

until we are required to stop by convenience. There is a lot to cover, we really want to

keep the pace up the best we can. So, we'll take break mid-morning, after Life Cycle Cost

analysis we will talk about National Energy Impacts, followed by Utility/Environmental

Analysis. And as Carl said in his comments you are on your own for lunch and we will

take a full hour for lunch. We encourage you to stay close by, if you go to L'Enfant Plaza

sometimes it's hard to get back in the span of an hour. Whenever we break, what ever we

say will be a start time we will start back up at that time.

9

EE-RM-97-500 COMMENT 21OO

time as much as you can. Listen as an ally. The better the listening, the better the quality 

of the discourse I find. The listening proceeds the (not audible) The more we adhere to 

that as a standard, the better offwe are going to be. There are no dumb questions in this 

room today. Not a single one. And we want to encourage questions. We want to the 

exchange of information. And, I will be recognizing people to speak. I will try to keep it 

moving as fast as possible. I will ask for your consideration. I will be cueing 

to speak. So, I am going to try also at my (not audible) to allow people to 

people 

kind of 

jump into the cue and make certain comments. If those comments are not short, you will 

not be recognized again for another. I do want to keep this dynamic, but I want to be fair 

and let everybody speak. You understand the dilemma there. That's what I am trying to 

do up here. So, that's the basic thing that I am trying to achieve. All of you I believe 

received a copy ofthe agenda. I am going to review now for those of you who wish to 

follow along with me. That's a very brief status update on the standards program. Follow 

these introductions and this agenda review. And then moving on to page two, we get into 

the subsistent aspects of the workshop to dEy. Input to the technical support document 

specifically Life Cycle Cost Analysis. And you can see the subelements that will be 

described there. The basic format for these workshops tends to be brief presentation, 

billeted presentation followed by Q and A and discussion. So after Life Cycle Cost 

Analysis, mid-morning in there sometime, when it is appropriate we will take a break. 

But we will keep pressing on until mid morning if we can. That is if we will keep working 

until we are required to stop by convenience. There is a lot to cover, we really want to 

keep the pace up the best we can. So, we'll take break mid-morning, after Life Cycle Cost 

analysis we will talk about National Energy Impacts, followed by UtilitylEnvironmental 

Analysis. And as Carl said in his comments you are on your own for lunch and we will 

take a full hour for lunch. We encourage you to stay close by, if you go to L'Enfant Pla;r,a 

sometimes it's hard to get back in the span of an hour. Whenever we break, what ever we 

say will be a start time we will start back up at that time. 

9 

time as much as you can. Listen as an ally. The better the listening, the better the quality 

of the discourse I find. The listening proceeds the (not audible) The more we adhere to 

that as a standard, the better offwe are going to be. There are no dumb questions in this 

room today. Not a single one. And we want to encourage questions. We want to the 

exchange of information. And, I will be recognizing people to speak. I will try to keep it 

moving as fast as possible. I will ask for your consideration. I will be cueing 

to speak. So, I am going to try also at my (not audible) to allow people to 

people 

kind of 

jump into the cue and make certain comments. If those comments are not short, you will 

not be recognized again for another. I do want to keep this dynamic, but I want to be fair 

and let everybody speak. You understand the dilemma there. That's what I am trying to 

do up here. So, that's the basic thing that I am trying to achieve. All of you I believe 

received a copy ofthe agenda. I am going to review now for those of you who wish to 

follow along with me. That's a very brief status update on the standards program. Follow 

these introductions and this agenda review. And then moving on to page two, we get into 

the subsistent aspects of the workshop to dEy. Input to the technical support document 

specifically Life Cycle Cost Analysis. And you can see the subelements that will be 

described there. The basic format for these workshops tends to be brief presentation, 

billeted presentation followed by Q and A and discussion. So after Life Cycle Cost 

Analysis, mid-morning in there sometime, when it is appropriate we will take a break. 

But we will keep pressing on until mid morning if we can. That is if we will keep working 

until we are required to stop by convenience. There is a lot to cover, we really want to 

keep the pace up the best we can. So, we'll take break mid-morning, after Life Cycle Cost 

analysis we will talk about National Energy Impacts, followed by UtilitylEnvironmental 

Analysis. And as Carl said in his comments you are on your own for lunch and we will 

take a full hour for lunch. We encourage you to stay close by, if you go to L'Enfant Pla;r,a 

sometimes it's hard to get back in the span of an hour. Whenever we break, what ever we 

say will be a start time we will start back up at that time. 

9 
After lunch, or whenever we get to it Other Analyses to be Performed, you can see them

listed there; and then after that Manufacturer Impact Analysis Methodology. Later on in

the afternoon Manufacturer Impact Analysis-Cash Flow Analysis and then Manufacturer

Interviews. An accounting of what came from those interviews. And then finally, the end

of the day, The Schedule for conducting the Manufacturer Impact Analysis, you can

subelements there. We will close out the day, doing Next Stop and Evaluation of the

Workshop. We plan to adjourn by five. Sometimes we do better than that. We should

however make it all the way through this agenda no later than five today. That is the plan.

The agenda as written typically comes from Staff at DoE doing a significant about

of, thinking about what should be covered and talking to people about what

additional should be covered. If items are not concluded in the agenda, we flag them,

we will note them, we'll find the time appropriate to discuss at this time. Then we will find

a way to fit those into the discussion. Yes, Bob.

Bob Wisbey, Advance Transformer, Inc:

Doug, there is one thing we would like to see added to the agenda. There are

manufactures that are not ballast manufactures. There are lamp manufacturers. There

manufactures of various components and materials which supply the ballast industry. We

would like to see these people have an opportunity to express their thoughts and views in

terms because they have not participated in the workshops before. We would like to see

an agenda item added to that, prior to the Cash Flow Analysis.

-Doug Brookman:

Are you in a position to characterize the nature of their comments? I want to

make sure it is kind of germane to the topic.

Bob Wisbey:

Yes. I think in most cases today, most companies would like an opportunity to

10

EE-RM-97-500 COMMENT 21OO

After lunch, or whenever we get to it Other Analyses to be Perfonned, you can see them 

listed there; and then after that Manufacturer Impact Analysis Methodology. Later on in 

the afternoon Manufacturer Impact Analysis-Cash Flow Analysis and then Manufacturer 

Interviews. An accounting of what came from those interviews. And then finally, the end· 

of the day, The Schedule for conducting the Manufacturer Impact Analysis, you can 

subelements there. We will close out the day, doing Next Stop and Evaluation of the 

Workshop. We plan to adjourn by five. Sometimes we do better than that. We should 

however make it all the way through this agenda no later than five today. That is the plan. 

The agenda as written typically comes from Staff at DoE doing a significant about 

o~ thinking about what should be covered and talking to people about what 

additional should be covered. If items are not concluded in the agenda, we flag them, 

we will note them, we'll find the time appropriate to discuss at this time. Then we will find 

a way to fit those into the discussion. Yes, Bob. 

Bob Wisbey, Advance Transfonner, Inc: 

Doug, there is one thing we would like to see added to the agenda. There are 

manufactures that are not ballast manufactures. There are lamp manufacturers. There 

manufactures of various components and materials which supply the ballast industry. We 

would like to see these people have an opportunity to express their thoughts and views in 

terms because they have not participated in the workshops before. We would like to see 

an agenda item added to that, prior to the Cash Flow Analysis . 

. Doug Brookman: 

Are you in a position to characterize the nature of their comments? I want to 

make sure it is kind of gennane to the topic. 

Bob Wisbey: 

Yes. I think in most cases today, most companies would like an opportunity to 

10 

After lunch, or whenever we get to it Other Analyses to be Perfonned, you can see them 

listed there; and then after that Manufacturer Impact Analysis Methodology. Later on in 

the afternoon Manufacturer Impact Analysis-Cash Flow Analysis and then Manufacturer 

Interviews. An accounting of what came from those interviews. And then finally, the end· 

of the day, The Schedule for conducting the Manufacturer Impact Analysis, you can 

subelements there. We will close out the day, doing Next Stop and Evaluation of the 

Workshop. We plan to adjourn by five. Sometimes we do better than that. We should 

however make it all the way through this agenda no later than five today. That is the plan. 

The agenda as written typically comes from Staff at DoE doing a significant about 

o~ thinking about what should be covered and talking to people about what 

additional should be covered. If items are not concluded in the agenda, we flag them, 

we will note them, we'll find the time appropriate to discuss at this time. Then we will find 

a way to fit those into the discussion. Yes, Bob. 

Bob Wisbey, Advance Transfonner, Inc: 

Doug, there is one thing we would like to see added to the agenda. There are 

manufactures that are not ballast manufactures. There are lamp manufacturers. There 

manufactures of various components and materials which supply the ballast industry. We 

would like to see these people have an opportunity to express their thoughts and views in 

terms because they have not participated in the workshops before. We would like to see 

an agenda item added to that, prior to the Cash Flow Analysis . 

. Doug Brookman: 

Are you in a position to characterize the nature of their comments? I want to 

make sure it is kind of gennane to the topic. 

Bob Wisbey: 

Yes. I think in most cases today, most companies would like an opportunity to 

10 
make a very brief comment relevant to the impact on their industry or their company. A

brief comment for the record characterizing the impact of potential new regulations on

their companies and industries.

Doug Brookman:

You said before the Cash Flow Analysis?

Bob Wispy:

That would be the preference. That would be my recommended. Between C and D

would be my preference because once we get into D it will be a very complex and

detailed technical analysis. The other related request I would like to make is that since

the manufactures impact portion of this is really only the afternoon portion, there are a

number of people that will be attending the afternoon, I believe, who are not here this

morning because they do not have a particular interest in this part of it. So I request that

the introductions be redone again at the beginning of the afternoon session.

Doug Brookman:

We can certainly redo that. Additional comments, questions, thoughts on the

agenda? I see none at this time. So we will let the Department entertain you request

and we will come back on that. Any other preliminaries before we get into the agenda?

Carl Adams:

Let me just say that I can accommodate both of these requests that have been

requested. By way of a status update, I am just going to show the schedule of events

that hopefull lead to -- [Slides] you can see we are here on April the 28th at the

workshop. And as I said earlier the status is we are behind schedule. We hope to have

developed and send out the Manufacture Impact Analysis (MIA) Survey by June 11. We

hope to visit manufactures sometime during the time frame of July. The Manufacture

Impact Analysis is hoped to be available in late September. We will have another

workshop in late October to discuss the Manufacture Impact Analysis results and the Life

--Cycle Cost Analysis results. That will hopefully lead to the Notice of Proposed

11

EE-RM-97-500 COMMENT 21OO

make a very brief comment relevant to the impact on their industry or their company. A 

brief comment for the record characterizing the impact of potential new regulations on 

their companies and industries. 

Doug Brookman: 

You said before the Cash Flow Analysis? 

Bob Wisbey: 

That would be the preference. That would be my recommended. Between C and D 

would be my preference because once we get into D it will be a very complex and 

detailed technical analysis. The other related request I would like to make is that since 

the manufactures impact portion of this is really only the afternoon portion, there are a 

number of people that will be attending the afternoon, I believe, who are not here this 

morning because they do not have a particular interest in this part of it. So I request that 

the introductions be redone again at the beginning of the afternoon session. 

Doug Brookman: 

We can certainly redo that. Additional comments, questions, thoughts on the 

agenda? I see none at this time. So we will let the Department entertain you request 

and we will come back on that. Any other preliminaries before we get into the agenda? 

Carl Adams: 

Let me just say that I can accommodate both of these requests that have been 

requested. By way of a status update, I am just going to show the schedule of events 

that hopefulliead to -- [Slides] you can see we are here on April the 28th at the 

workshop. And as I said earlier the status is we are behind schedule. We hope to have 

developed and send out the Manufacture Impact Analysis (MIA) Survey by June 11. We 

hope to visit manufactures sometime during the time frame of July. The Manufacture 

1mpact Analysis is hoped to be available in late September. We will have another 

workshop in late October to discuss the Manufacture Impact Analysis results and the Life 

-Cycle Cost Analysis results. That will hopefully lead to the Notice of Proposed 

11 

make a very brief comment relevant to the impact on their industry or their company. A 

brief comment for the record characterizing the impact of potential new regulations on 

their companies and industries. 

Doug Brookman: 

You said before the Cash Flow Analysis? 

Bob Wisbey: 

That would be the preference. That would be my recommended. Between C and D 

would be my preference because once we get into D it will be a very complex and 

detailed technical analysis. The other related request I would like to make is that since 

the manufactures impact portion of this is really only the afternoon portion, there are a 

number of people that will be attending the afternoon, I believe, who are not here this 

morning because they do not have a particular interest in this part of it. So I request that 

the introductions be redone again at the beginning of the afternoon session. 

Doug Brookman: 

We can certainly redo that. Additional comments, questions, thoughts on the 

agenda? I see none at this time. So we will let the Department entertain you request 

and we will come back on that. Any other preliminaries before we get into the agenda? 

Carl Adams: 

Let me just say that I can accommodate both of these requests that have been 

requested. By way of a status update, I am just going to show the schedule of events 

that hopefulliead to -- [Slides] you can see we are here on April the 28th at the 

workshop. And as I said earlier the status is we are behind schedule. We hope to have 

developed and send out the Manufacture Impact Analysis (MIA) Survey by June 11. We 

hope to visit manufactures sometime during the time frame of July. The Manufacture 

1mpact Analysis is hoped to be available in late September. We will have another 

workshop in late October to discuss the Manufacture Impact Analysis results and the Life 

-Cycle Cost Analysis results. That will hopefully lead to the Notice of Proposed 

11 
Rulemaking in February 1999, and there will be a Public Hearing following that in the

March time frame. And the Final Rule hopefully in October 1999.

Again the purpose this workshop is to hear the views of any persons and gather

information concerning the inputs to the Life Cycle Cost, National Energy Impact

UtilityAnalysis and the methodology for conducting the Manufacturing Impact

Analysis for the Technical Support Document as the proposed rule on Fluorescent Lamp

Ballast. Now making our way into our first topic. Again we have a lot of information to

go over today. Hopefully we can move along. As I am sure all of you know, the original

Technical Support Document was completed in November 1993. It was published in

March of 1994 as part of the HR Proposed Rule. Some call this the black box era. More

importantly, no one outside the walls of DoE saw the analysis or the inputs to the analysis

prior to its publication. After the Technical Support Document was published there were

a series of meetings which followed the publication to discuss how the analysis was

done and what the inputs were that went into the analysis. As a result of these

meetings there was a revised analysis in February 1996 for the Life Cycle Cost and the

Energy Savings. In dune of 1996 a Public Workshop was conducted on the new reports

followed by the publication in July 1997 of the Process Improvement Rule, which indicated

the Department's commitment to implementing a better, more inclusive and open

rulemaking process. For this particular rule, the Lamp Ballast Rule, a series of stake

over interviews was planned with the Department's Staff member visiting the

manufactures and other interested parties. The information drawn from these

interviews contributed to a new price survey. Additionally, a variability analysis on

key parameters was to be concluded. The National Energy Savings would be

presented in more detail, for example using forecast. It would also contain a energy

forecast using different electricity price projections. The second draft was published in

July 1997 and released for comment. A distributors survey has been performed to check

ballast prices. There's also been additional research on ballast lifetimes; an analysis of the

12

EE-RM-97-500 COMMENT 21OO

Rulemaking in February 1999, and there will be a Public Hearing following that in the 

March time frame. And the Final Rule hopefully in October 1999. 

Again the purpose this workshop is to hear the views of any persons and gather 

information concerning the inputs to the Life Cycle Cost, National Energy Impact 

UtilityAnalysis and the methodology for conducting the Manufacturing Impact 

Analysis for the Technical Support Document as the proposed rule on Fluorescent Lamp 

Ballast. Now making our way into our first topic. Again we have a lot of information to 

go over today. Hopefully we can move along. As I am sure all of you know, the original 

Technical Support Document was completed in November 1993. It was published in 

March of 1994 as part of the HR Proposed Rule. Some call this the black box era. More 

importantly, no one outside the walls of DoE saw the analysis or the inputs to the analysis 

prior to its publication. After the Technical Support Document was published there were 

a series of meetings which followed the publication to discuss how the analysis was 

done and what the inputs were that went into the analysis. As a result of these 

meetings there was a revised analysis in February 1996 for the Life Cycle Cost and the 

Energy Savings. In June of 1996 a Public Workshop was conducted on the new reports 

followed by the publication in July 1997 of the Process Improvement Rule, which indicated 

the Department's commitment to implementing a better, more inclusive and open 

rulemaking process. For this particular rule, the Lamp Ballast Rule, a series of stake 

over interviews was planned with the Department's Staff member visiting the 

manufactures and other interested parties. The information drawn from these 

interviews contributed to a new price survey. Additionally, a variability analysis on 

key parameters was to be concluded. The National Energy Savings would be 

presented in more detail, for example using forecast. It would also contain a energy 

forecast using different electricity price projections. The second draft was published in 

July 1997 and released for comment. A distributors survey has been performed to check 

ballast prices. There's also been additional research on ballast lifetimes; an analysis of the 

12 

Rulemaking in February 1999, and there will be a Public Hearing following that in the 

March time frame. And the Final Rule hopefully in October 1999. 

Again the purpose this workshop is to hear the views of any persons and gather 

information concerning the inputs to the Life Cycle Cost, National Energy Impact 

UtilityAnalysis and the methodology for conducting the Manufacturing Impact 

Analysis for the Technical Support Document as the proposed rule on Fluorescent Lamp 

Ballast. Now making our way into our first topic. Again we have a lot of information to 

go over today. Hopefully we can move along. As I am sure all of you know, the original 

Technical Support Document was completed in November 1993. It was published in 

March of 1994 as part of the HR Proposed Rule. Some call this the black box era. More 

importantly, no one outside the walls of DoE saw the analysis or the inputs to the analysis 

prior to its publication. After the Technical Support Document was published there were 

a series of meetings which followed the publication to discuss how the analysis was 

done and what the inputs were that went into the analysis. As a result of these 

meetings there was a revised analysis in February 1996 for the Life Cycle Cost and the 

Energy Savings. In June of 1996 a Public Workshop was conducted on the new reports 

followed by the publication in July 1997 of the Process Improvement Rule, which indicated 

the Department's commitment to implementing a better, more inclusive and open 

rulemaking process. For this particular rule, the Lamp Ballast Rule, a series of stake 

over interviews was planned with the Department's Staff member visiting the 

manufactures and other interested parties. The information drawn from these 

interviews contributed to a new price survey. Additionally, a variability analysis on 

key parameters was to be concluded. The National Energy Savings would be 

presented in more detail, for example using forecast. It would also contain a energy 

forecast using different electricity price projections. The second draft was published in 

July 1997 and released for comment. A distributors survey has been performed to check 

ballast prices. There's also been additional research on ballast lifetimes; an analysis of the 

12 
impact of utility DSM programs on the fluorescent lamp ballast market; and the creation

of a spreedsheet model to be used in parallel with the forecasting model. It is hoped that

these additions will strengthen the analytical foundations of the ballast rulemaking by

providing the improved methods, more accurate data, and a more comprehensive picture

of the lamp ballast industry. I would now like to introduce Isaac Turiel of Lawrence

Berekely National Laboratory who conducts the analysis under the direction DoE. And he

will further discuss the proposed analysis.

Isaac Turiel, Lawrence Berekely National Laboratory:

Good morning everybody. Thank you. I see a lot of familiar faces here. This

is a very large team effort. [Slides with Reference entitled Public Workshop on

Fluorescent Lamp Ballasts presentation by Appliance & Lighting Standards Group

at Lawrence Berekeley National Laboratory. And the next view shows the people who

have been working on this project. Three of us are here today, myself, Barbara Atkinson

and Diane Fisher. First part of the presentation deals with the Life-Cycle Cost and in

regards to cost, the first cost we look at are the five most important parameters that are

inputs to the analysis, and the last part deals with the sensitivity analyses that we do, that

is the variability and uncertainty analysis. And that is the part that Diane Fisher will

present. One of the variables is say what we've done before, what's proposed for the

Technical Support Document the next analysis, and what is the rationale for making those

choices. The first parameter is the Annual Lighting Hours and for this one we just have

this one slide here and it shows what values we have chosen for the operating hours

for lamps. And you can see they vary from 3600 hours for the lowest in the commercial

sector up to a maximum of 5000 hours for 8 foot high output lamp in the industrial sector.

And we also did a single-value sensitivity analysis for a low of 2500 hours and a high of

8000 hours for each ballast type. In addition, we did a probability-based sensitivity

analysis and we used lighting hours distribution from Xenergy's database they produced

that we purchased. The proposal for the TSD is that no change is being made for lighting

13

EE-RM-97-500 COMMENT 21OO

impact of utility DSM programs on the fluorescent lamp ballast market; and the creation 

of a spreedsheet model to be used in parallel with the forecasting model. It is hoped that 

these additions will strengthen the analytical foundations of the ballast rulemaking by 

providing the improved methods, more accurate data, and a more comprehensive picture 

of the lamp ballast industry. I would now like to introduce Isaac Turiel of Lawrence 

Berekely National Laboratory who conducts the analysis under the direction DoE. And he 

will further discuss the proposed analysis. 

Isaac Turiel, Lawrence Berekely National Laboratory: 

Good morning everybody. Thank you. I see a lot offamiliar faces here. This 

is a very large team effort. [Slides with Reference entitled Public Workshop on 

Fluorescent Lamp Ballasts presentation by Appliance & Lighting Standards Group 

at Lawrence Berekeley National Laboratory. And the next view shows the people who 

have been working on this project. Three of us are here today, myself: Barbara Atkinson 

and Diane Fisher. First part of the presentation deals with the Life-Cycle Cost and in 

regards to cost, the first cost we look at are the five most important parameters that are 

inputs to the analysis, and the last part deals with the sensitivity analyses that we do, that 

is the variability and uncertainty analysis. And that is the part that Diane Fisher will 

present. One of the variables is say what we've done before, what's proposed for the 

Technical Support Document the next analysis, and what is the rationale for making those 

choices. The first parameter is the Annual Lighting Hours and for this one we just have 

this one slide here and it shows what values we have chosen for the operating hours 

for lamps. And you can see they vary from 3600 hours for the lowest in the commercial 

sector up to a maximum of 5000 hours for 8 foot high output lamp in the industrial sector. 

And we also did a single-value sensitivity analysis for a low of2500 hours and a high of 

8000 hours for each ballast type. In addition, we did a probability-based sensitivity 

analysis and we used lighting hours distribution from Xenergy's database they produced 

that we purchased. The proposal for the TSD is that no change is being made for lighting 

13 

impact of utility DSM programs on the fluorescent lamp ballast market; and the creation 

of a spreedsheet model to be used in parallel with the forecasting model. It is hoped that 

these additions will strengthen the analytical foundations of the ballast rulemaking by 

providing the improved methods, more accurate data, and a more comprehensive picture 

of the lamp ballast industry. I would now like to introduce Isaac Turiel of Lawrence 

Berekely National Laboratory who conducts the analysis under the direction DoE. And he 

will further discuss the proposed analysis. 

Isaac Turiel, Lawrence Berekely National Laboratory: 

Good morning everybody. Thank you. I see a lot offamiliar faces here. This 

is a very large team effort. [Slides with Reference entitled Public Workshop on 

Fluorescent Lamp Ballasts presentation by Appliance & Lighting Standards Group 

at Lawrence Berekeley National Laboratory. And the next view shows the people who 

have been working on this project. Three of us are here today, myself: Barbara Atkinson 

and Diane Fisher. First part of the presentation deals with the Life-Cycle Cost and in 

regards to cost, the first cost we look at are the five most important parameters that are 

inputs to the analysis, and the last part deals with the sensitivity analyses that we do, that 

is the variability and uncertainty analysis. And that is the part that Diane Fisher will 

present. One of the variables is say what we've done before, what's proposed for the 

Technical Support Document the next analysis, and what is the rationale for making those 

choices. The first parameter is the Annual Lighting Hours and for this one we just have 

this one slide here and it shows what values we have chosen for the operating hours 

for lamps. And you can see they vary from 3600 hours for the lowest in the commercial 

sector up to a maximum of 5000 hours for 8 foot high output lamp in the industrial sector. 

And we also did a single-value sensitivity analysis for a low of2500 hours and a high of 

8000 hours for each ballast type. In addition, we did a probability-based sensitivity 

analysis and we used lighting hours distribution from Xenergy's database they produced 

that we purchased. The proposal for the TSD is that no change is being made for lighting 

13 
hours. There will be some more information presented on this subject, as I said a little

bit later. This next slide I would like to talk about is Ballast Prices. What we did is for

the 1997 report was that the average prices were obtained from a survey that was done for

LBNL by Gough and Associates (not audible) LRI, Lighting Research Institute. And in

the survey ballast manufactures and fixture manufactures were asked to estimate OEM

prices and Lighting Maintenance Companies to estimate contractor prices. And with

mark-ups that were developed in the survey, these were used to generate the end-user

price. It was done for three different distribution channels. We did not perform a price

sensitivities analysis in that last channel. There were a lot of comments on the markups

that we used to generate the end-user prices and what we tried to do was get some more

information on ballast prices. And what we did was conducted a survey to do this in a

more direct manner. And what we've done as we contacted electrical distributors. All

together thirty were contacted , and twenty-two of those responded with pricing

information. And that information is in your hard copy handout, the table there which

shows each of the individual responses that we received. And they were asked to assume

the quote for this price was at least 100 ballasts, and they were for a 2-lamp 120 volt

fixtures. I want to point out that not all distributors provided quotes for each of the five

ballasts types.

Mike Stein, MagneTek, Inc:

As we go through this is it appropriate to comment?

Isaac Turiel:

Maybe for each parameter might be the best way to do it.

Mike Stein:

So once you go through the whole price analysis.

Isaac Turiel:

Yes, maybe some things might be answered as I go through the other ones.

Then after that, that would be good before we go to the next parameter.

14

EE-RM-97-500 COMMENT 21OO

hours. There will be some more information presented on this subject, as I said a little 

bit later. This next slide I would like to talk about is Ballast Prices. What we did is for 

the 1997 report was that the average prices were obtained from a survey that was done for 

LBNL by Gough and Associates (not audible) LRI, Lighting Research Institute. And in 

the survey ballast manufactures and fixture manufactures were asked to estimate OEM 

prices and Lighting Maintenance Companies to estimate contractor prices. And with 

mark-ups that were developed in the survey, these were used to generate the end-user 

price. It was done for three different distribution channels. We did not perform a price 

sensitivities analysis in that last channel. There were a lot of comments on the markups 

that we used to generate the end-user prices and what we tried to do was get some more 

information on ballast prices. And what we did was conducted a survey to do this in a 

more direct manner. And what we've done as we contacted electrical distributors. All 

together thirty were contacted, and twenty-two of those responded with pricing 

information. And that information is in your hard copy handout, the table there which 

shows each of the individual responses that we received. And they were asked to assume 

the quote for this price was at least 100 ballasts, and they were for a 2-lamp 120 volt 

fixtures. I want to point out that not all distributors provided quotes for each of the five 

ballasts types. 

Mike Stein, MagneTek, Inc: 

As we go through this is it appropriate to comment? 

Isaac Turiel: 

Maybe for each parameter might be the best way to do it. 

Mike Stein: 

So once you go through the whole price analysis. 

Isaac Turiel: 

Yes, maybe some things might be answered as I go through the other ones. 

Then after that, that would be good before we go to the next parameter. 

14 

hours. There will be some more information presented on this subject, as I said a little 

bit later. This next slide I would like to talk about is Ballast Prices. What we did is for 

the 1997 report was that the average prices were obtained from a survey that was done for 

LBNL by Gough and Associates (not audible) LRI, Lighting Research Institute. And in 

the survey ballast manufactures and fixture manufactures were asked to estimate OEM 

prices and Lighting Maintenance Companies to estimate contractor prices. And with 

mark-ups that were developed in the survey, these were used to generate the end-user 

price. It was done for three different distribution channels. We did not perform a price 

sensitivities analysis in that last channel. There were a lot of comments on the markups 

that we used to generate the end-user prices and what we tried to do was get some more 

information on ballast prices. And what we did was conducted a survey to do this in a 

more direct manner. And what we've done as we contacted electrical distributors. All 

together thirty were contacted, and twenty-two of those responded with pricing 

information. And that information is in your hard copy handout, the table there which 

shows each of the individual responses that we received. And they were asked to assume 

the quote for this price was at least 100 ballasts, and they were for a 2-lamp 120 volt 

fixtures. I want to point out that not all distributors provided quotes for each of the five 

ballasts types. 

Mike Stein, MagneTek, Inc: 

As we go through this is it appropriate to comment? 

Isaac Turiel: 

Maybe for each parameter might be the best way to do it. 

Mike Stein: 

So once you go through the whole price analysis. 

Isaac Turiel: 

Yes, maybe some things might be answered as I go through the other ones. 

Then after that, that would be good before we go to the next parameter. 

14 
Howard Wolfinan, Motorola Lighting, Inc.:

And where is the hard copy you referred to?

Isaac Turiel:

The package there in from of you I'm not sure.

(Discussion about pages 7, 8, and 11 not being duplicated fully.)

Our apologies to you.I will have to read some of those numbers until

we get the inserts. I am sorry about that.What's here is the summary and the

results for five different ballast types. I will read what they are. Starting from the left

hand side, this is all for 2-lamp ballasts. And the first one is F40T12, Magnetic; next one

is F40T12, Electronic; F32T8, Electronic; then we have F96T12, Magnetic; and

F96T12, Electronic. Right below is the number of quotes -- the highest is 21 and the

lowest on the right hand side is 9. That's the range of the number of quotes, responses we

received, For the next row shows what the average value is plus 13%. The reason for

13% was the markup we got from the LRI study that was used from the contractors to the

end-user. A 13% markup. So we added that into the average. You will be getting this

momentarily. The next row is what the price was in the draft report. And then the row

below it is the price difference (percentage). I will just say a little bit about the price

difference between the draft report and the average plus 13%. We found that all the

numbers from the survey are higher than the numbers from the draft report, except for the

second one which is very low, the F40T12 Electronic is 1.4% and the others are on the

order of 20% higher. Next slide, just repeats the data on top and the new information is on

the bottom. What we have done is if you will look at the Delta Price between the

electronic ballast and the magnetic ballast but for the 2F40T12 and the 2F96T12. So what

we find for the price difference looking at the 4 foot T12 is that the Draft Report was

$10.92 and in the survey it's $9.47. So that's the Delta Price come's out to be lower by

around 12%. An 8 foot T12 they are very close to each other. $10.59 for the Draft

15

EE-RM-97-500 COMMENT 21OO

Howard Wolfinan, Motorola Lighting, Inc.: 

And where is the hard copy you referred to? 

Isaac Turiel: 

The package there in from of you I'm not sure. 

(Discussion about pages 7,8, and 11 not being duplicated fully.) 

Our apologies to you.! will have to read some of those numbers until 

we get the inserts. I am sorry about that. What's here is the summary and the 

results for five different ballast types. I will read what they are. Starting :from the left 

hand side, this is all for 2-lamp ballasts. And the first one is F40T12, Magnetic; next one 

is F40T12, Electronic; F32T8, Electronic; then we have F96T12, Magnetic; and 

F96T12, Electronic. Right below is the number of quotes -- the highest is 21 and the 

lowest on the right hand side is 9. That's the range ofthe number of quotes, responses we 

received, For the next row shows what the average value is plus 13%. The reason for 

13% was the markup we got from the LRI study that was used from the contractors to the 

end-user. A 13% markup. So we added that into the average. You will be getting this 

momentarily. The next row is what the price was in the draft report. And then the row 

below it is the price difference (percentage). I will just say a little bit about the pnce 

difference between the draft report and the average plus 13%. We found that all the 

numbers :from the survey are higher than the numbers :from the draft report, except for the 

second one which is very low, the F40T12 Electronic is 1.4% and the others are on the 

order of20% higher. Next slide, just repeats the data on top and the new information is on 

the bottom. What we have done is if you will look at the Delta Price between the 

electronic ballast and the magnetic ballast but for the 2F40T12 and the 2F96T12. So what 

we find for the price difference looking at the 4 foot T12 is that the Draft Report was 

$lO.92 and in the survey it's $9.47. So that's the Delta Price come's out to be lower by 

around 12%. An 8 foot T12 they are very close to each other. $lO.59 for the Draft 

15 

Howard Wolfinan, Motorola Lighting, Inc.: 

And where is the hard copy you referred to? 

Isaac Turiel: 

The package there in from of you I'm not sure. 

(Discussion about pages 7,8, and 11 not being duplicated fully.) 

Our apologies to you.! will have to read some of those numbers until 

we get the inserts. I am sorry about that. What's here is the summary and the 

results for five different ballast types. I will read what they are. Starting :from the left 

hand side, this is all for 2-lamp ballasts. And the first one is F40T12, Magnetic; next one 

is F40T12, Electronic; F32T8, Electronic; then we have F96T12, Magnetic; and 

F96T12, Electronic. Right below is the number of quotes -- the highest is 21 and the 

lowest on the right hand side is 9. That's the range ofthe number of quotes, responses we 

received, For the next row shows what the average value is plus 13%. The reason for 

13% was the markup we got from the LRI study that was used from the contractors to the 

end-user. A 13% markup. So we added that into the average. You will be getting this 

momentarily. The next row is what the price was in the draft report. And then the row 

below it is the price difference (percentage). I will just say a little bit about the pnce 

difference between the draft report and the average plus 13%. We found that all the 

numbers :from the survey are higher than the numbers :from the draft report, except for the 

second one which is very low, the F40T12 Electronic is 1.4% and the others are on the 

order of20% higher. Next slide, just repeats the data on top and the new information is on 

the bottom. What we have done is if you will look at the Delta Price between the 

electronic ballast and the magnetic ballast but for the 2F40T12 and the 2F96T12. So what 

we find for the price difference looking at the 4 foot T12 is that the Draft Report was 

$lO.92 and in the survey it's $9.47. So that's the Delta Price come's out to be lower by 

around 12%. An 8 foot T12 they are very close to each other. $lO.59 for the Draft 

15 
Draft Report and $10.34 just slightly lower on the survey. Those are the results that we

obtained form the quotes.

Howard Wolfinan:

What was the time period during which these quotes were gathered?

Isaac Turiel:

Over the last twelve months. So the proposal in the TSD are the following:

Use the Draft Report prices as input to the TSD. To do a sensitivity analysis with

high and low prices obtained from the telephone survey. And we would also do a

probability based sensitivity analysis using the distribution of the telephone survey

prices. Then we turn to rationale. Although the price difference between the magnetic

and electronic is somewhat lower in the phone survey no change in prices is

proposed for the TSD. But also since the ballast price are a very important

parameter in the LCC analysis, this time we will do a sensitivity analysis on that. It

was not done on the previous analysis. I will stop here for a second to see if there are any

questions on ballast prices.

Mike Rivest, Arthur D. Little, Inc.:

Trying to comment on direct material we had the meeting not what we've

presented here but I think it is very important that we understand your rationale

and try to make sense of what you just proposed. The statement was made that the

ballast manufactures were asked to estimate OEM to distributors markups and they

estimated 35 to 40% for magnetic ballasts and 10% for electronic ballasts. We are

trying to figure out when that was asked of them? The survey asked a completely

different question. The survey asked how much the industry average OEM price using

both tables, we estimate the average industry electrical distributor price to be. These are

apples and oranges -- to different (not audible). Now let me try to explain this and

what happened to this. So the first question we answered was what was the ballast

manufacture price, the OEM (not audible) , it's right here. Then what would you estimate

16

EE-RM-97-500 COMMENT 21OO

Draft Report and $10.34 just slightly lower on the survey. Those are the results that we 

obtained form the quotes. 

Howard Wol:finan: 

What was the time period during which these quotes were gathered? 

Isaac Turiel: 

Over the last twelve months. So the proposal in the TSD are the following: 

Use the Draft Report prices as input to the TSD. To do a sensitivity analysis with 

high and low prices obtained from the telephone survey. And we would also do a 

probability based sensitivity analysis using the distribution of the telephone survey 

prices. Then we turn to rationale. Although the price difference between the magnetic 

and electronic is somewhat lower in the phone survey no change in prices is 

proposed for the TSD. But also since the ballast price are a very important 

parameter in the LCC analysis, this time we will do a sensitivity analysis on that. It 

was not done on the previous analysis. I will stop here for a second to see if there are any 

questions on ballast prices. 

Mike Rivest, Arthur D. Little, Inc.: 

Trying to comment on direct material we had the meeting not what we've 

presented here but I think it is very importent that we understand your rationale 

and try to make sense of what you just proposed. The statement was made that the 

ballast manufactures were asked to estimate OEM to distributors markups and they 

estimated 35 to 40% for magnetic ballasts and 10% for electronic ballasts. We are 

trying to figure out when that was asked of them? The survey asked a completely 

different question. The survey asked how much the industry average OEM price using 

both tables, we estimate the average industry electrical distributor price to be. These are 

apples and oranges -- to different (not audible). Now let me try to explain this and 

what happened to this. So the first question we answered was what was the ballast 

manufacture price, the OEM (not audible) , it's right here. Then what would you estimate 

16 

Draft Report and $10.34 just slightly lower on the survey. Those are the results that we 

obtained form the quotes. 

Howard Wol:finan: 

What was the time period during which these quotes were gathered? 

Isaac Turiel: 

Over the last twelve months. So the proposal in the TSD are the following: 

Use the Draft Report prices as input to the TSD. To do a sensitivity analysis with 

high and low prices obtained from the telephone survey. And we would also do a 

probability based sensitivity analysis using the distribution of the telephone survey 

prices. Then we turn to rationale. Although the price difference between the magnetic 

and electronic is somewhat lower in the phone survey no change in prices is 

proposed for the TSD. But also since the ballast price are a very important 

parameter in the LCC analysis, this time we will do a sensitivity analysis on that. It 

was not done on the previous analysis. I will stop here for a second to see if there are any 

questions on ballast prices. 

Mike Rivest, Arthur D. Little, Inc.: 

Trying to comment on direct material we had the meeting not what we've 

presented here but I think it is very importent that we understand your rationale 

and try to make sense of what you just proposed. The statement was made that the 

ballast manufactures were asked to estimate OEM to distributors markups and they 

estimated 35 to 40% for magnetic ballasts and 10% for electronic ballasts. We are 

trying to figure out when that was asked of them? The survey asked a completely 

different question. The survey asked how much the industry average OEM price using 

both tables, we estimate the average industry electrical distributor price to be. These are 

apples and oranges -- to different (not audible). Now let me try to explain this and 

what happened to this. So the first question we answered was what was the ballast 

manufacture price, the OEM (not audible) , it's right here. Then what would you estimate 

16 
the difference be from this price to this price, ballast manufacture and distributors.

And that's information we gave in the survey. What was indicated in the write up was this

direction for the price. What was the different between the OEM and the distributor

markup? And there is no such markup We only sell to two channels. We sell to the

OEM. We sell to the distributor. And we are interested that you did a survey from this.

We never had a price problem with this last line information, the data that you published

on distributor price is reasonable. It represents 37% of the market. The problem is that

63% of the market, we have prices -- the magnetic ballast was marked up 84% and the

electronic ballast marked 38%. And that's the channel for the year. And then there is a

dotted line and we don't know what happens there as far as these prices or here or here.

So you spend so much time on a survey that I don't know had any comments with the

numbers you put in there. It would have been more interesting if you went to the

distributor and brought fixtures with those ballast in them. And then we maybe would

have had a better idea of the fixture cost. You go buy the same fixture with a magnetic

ballast and an electronic ballast and then you know what the fixture price is here. You

know what the ballast manufacture sells the fixture to OEM, and then maybe we'll have an

idea of what this is. And this is the number that you can (not audible), the end-user price

right here on the doted line. And you didn't try to solve that problem (not audible).

Isaac Turiel:

I think it is reasonable what said. But I think we were trying to answer part of

the question, how reasonable were the prices? And trying to get it the most direct

way. In the previous analysis by LRI, I didn't do the original work on that. But my

memory is that we didn't really get distributor prices. We had to go and get distributor

prices. So, therefore there was new work done. We didn't have distributor pricing. We

were trying to get those for the survey. In addition to that, yes, it makes sense to do what

you said to do. Also try to get with the fixture, with the ballast in the fixture. I agree with

that..

17

EE-RM-97-500 COMMENT 21OO

the difference be from this price to this price, ballast manufacture and distributors. 

And that's information we gave in the survey. What was indicated in the write up was this 

direction for the price. What was the different between the OEM and the distributor 

markup? And there is no such markup We only sell to two channels. We sell to the 

OEM. We sell to the distributor. And we are interested that you did a survey from this. 

We never had a price problem with this last line information, the data that you published 

on distributor price is reasonable. It represents 37% of the market. The problem is that 

63% of the market, we have prices -- the magnetic ballast was marked up 84% and the 

electronic ballast marked 38%. And that's the channel for the year. And then there is a 

dotted line and we don't know what happens there as far as these prices or here or here. 

So you spend so much time on a survey that I don't know had any comments with the 

numbers you put in there. It would have been more interesting if you went to the 

distributor and brought fixtures with those ballast in them And then we maybe would 

have had a better idea of the fixture cost. You go buy the same fixture with a magnetic 

ballast and an electronic ballast and then you know what the fixture price is here. You 

know what the balla'3t manufacture sells the fixture to OEM, and then maybe we'll have an 

idea of what this is. And this is the number that you can (not audible), the end-user price 

right here on the doted line. And you didn't try to solve that problem (not audible). 

Isaac Turiel: 

I think it is reasonable what said. But I think we were trying to answer part of 

the question, how reasonable were the prices? And trying to get it the most direct 

way. In the previous analysis by LRI, I didn't do the original work on that. But my 

memory is that we didn't really get distributor prices. We had to go and get distributor 

prices. So, therefore there was new work done. We didn't have distributor pricing. We 

were trying to get those for the survey. In addition to that, yes, it makes sense to do what 

you said to do. Also try to get with the fixture, with the ballast in the fixture. I agree with 

that .. 

17 

the difference be from this price to this price, ballast manufacture and distributors. 

And that's information we gave in the survey. What was indicated in the write up was this 

direction for the price. What was the different between the OEM and the distributor 

markup? And there is no such markup We only sell to two channels. We sell to the 

OEM. We sell to the distributor. And we are interested that you did a survey from this. 

We never had a price problem with this last line information, the data that you published 

on distributor price is reasonable. It represents 37% of the market. The problem is that 

63% of the market, we have prices -- the magnetic ballast was marked up 84% and the 

electronic ballast marked 38%. And that's the channel for the year. And then there is a 

dotted line and we don't know what happens there as far as these prices or here or here. 

So you spend so much time on a survey that I don't know had any comments with the 

numbers you put in there. It would have been more interesting if you went to the 

distributor and brought fixtures with those ballast in them And then we maybe would 

have had a better idea of the fixture cost. You go buy the same fixture with a magnetic 

ballast and an electronic ballast and then you know what the fixture price is here. You 

know what the balla'3t manufacture sells the fixture to OEM, and then maybe we'll have an 

idea of what this is. And this is the number that you can (not audible), the end-user price 

right here on the doted line. And you didn't try to solve that problem (not audible). 

Isaac Turiel: 

I think it is reasonable what said. But I think we were trying to answer part of 

the question, how reasonable were the prices? And trying to get it the most direct 

way. In the previous analysis by LRI, I didn't do the original work on that. But my 

memory is that we didn't really get distributor prices. We had to go and get distributor 

prices. So, therefore there was new work done. We didn't have distributor pricing. We 

were trying to get those for the survey. In addition to that, yes, it makes sense to do what 

you said to do. Also try to get with the fixture, with the ballast in the fixture. I agree with 

that .. 

17 
Doug Brookman:

Mike, will you say again for the record.

Mike Rivest:

The existing information is the ballast price to the end user as it goes through the

fixture channel. We sell it to the OEM fixture manufacture and they put it in a fixture

and they we're trying to determine the ballast price in the fixture. Because if you sold

it as ballast, you could have sold it with the fixture. So we didn't have any idea, and

obviously the survey was to survey the fixture manufactures and you didn't get

information? Were they on the list of survey originally (two persons speaking at same

time).

Isaac Turiel:

There was very little response at all.

Gene Foley, Alliance to Save Energy:

(not audible) mark up than the distributor?

Eugene Margolis, DoE:

There are parallel distribution chains from the distributor down to the end user.

The survey is responding to one distribution (not audible) individual ballast.

Almost 2/3's of the market, 2/3s of the ballast price study (not audible) in a ballast

but a fixture that includes a ballast so that we could determine the mark up on the

on the ballast portion of the fixture product to acquire a modest ...

Gene Foley:

But you still haven't answered my question. The mark up in the fixture manufacture

with the additional component, you are saying is going to be different for that ...

Eugene Margolis:

The mark up between the OEM and the distributor and there are the mark ups on the

fixture (not audible). Then you determine of that make up on the fixture what portion of

that will the distributor (not audible) ballast within a fixture. Actually, that is

18

EE-RM-97-500 COMMENT 21OO

Doug Brookman: 

Mike, will you say again for the record. 

Mike Rivest: 

The existing information is the ballast price to the end user as it goes through the 

fixture channel. We sell it to the OEM fixture manufacture and they put it in a fixture 

and they we're trying to determine the ballast price in the fixture. Because if you sold 

it as ballast, you could have sold it with the fixture. So we didn't have any idea, and 

obviously the survey was to survey the fixture manufactures and you didn't get an 

information? Were they on the list of survey originally (two persons speaking at same 

time). 

Isaac Turiel: 

There was very little response at all. 

Gene Foley, Alliance to Save Energy: 

(not audible) mark up than the distributor? 

Eugene Margolis, DoE: 

There are pE<Iallel distribution chains from the distributor down to the end user. 

The survey is responding to one distribution (not audible) individual ballast. 

Almost 2/3's of the market, 2/3s of the ballast price study (not audible) in a ballast 

but a fixture that includes a ballast so that we could determine the mark up on the 

on the ballast portion of the fixture product to acquire a modest ... 

Gene Foley: 

But you still haven't answered my question. The mark up in the fixture manufacture 

with the additional component, you are saying is going to be different for that ... 

Eugene Margolis: 

The mark up between the OEM and the distributor and there are the mark ups on the 

fixture (not audible). Then you determine of that make up on the fixture what portion of 

that will the distributor (not audible) ballast within a fixture. Actually, that is 

18 

Doug Brookman: 

Mike, will you say again for the record. 

Mike Rivest: 

The existing information is the ballast price to the end user as it goes through the 

fixture channel. We sell it to the OEM fixture manufacture and they put it in a fixture 

and they we're trying to determine the ballast price in the fixture. Because if you sold 

it as ballast, you could have sold it with the fixture. So we didn't have any idea, and 

obviously the survey was to survey the fixture manufactures and you didn't get an 

information? Were they on the list of survey originally (two persons speaking at same 

time). 

Isaac Turiel: 

There was very little response at all. 

Gene Foley, Alliance to Save Energy: 

(not audible) mark up than the distributor? 

Eugene Margolis, DoE: 

There are pE<Iallel distribution chains from the distributor down to the end user. 

The survey is responding to one distribution (not audible) individual ballast. 

Almost 2/3's of the market, 2/3s of the ballast price study (not audible) in a ballast 

but a fixture that includes a ballast so that we could determine the mark up on the 

on the ballast portion of the fixture product to acquire a modest ... 

Gene Foley: 

But you still haven't answered my question. The mark up in the fixture manufacture 

with the additional component, you are saying is going to be different for that ... 

Eugene Margolis: 

The mark up between the OEM and the distributor and there are the mark ups on the 

fixture (not audible). Then you determine of that make up on the fixture what portion of 

that will the distributor (not audible) ballast within a fixture. Actually, that is 

18 
fairly simple to do. Because the ballast is adds (not audible)

(there are about three or four persons speaking all a one time)

Mark Perlis, DSMO:

The point that you (not audible) vastly different mark up for magnetic ballast and the

electronic ballast in these analysis. Typically in the study used 84% mark up for magnetic

ballasts and 38% for electronic ballasts. We believe that the (not audible) the new work

that was presented relates to the pricing ballast sold (not audible) We never objected to

the pricing of (not audible)

Doug Brookman:

And I am sure the Department and LBNL would like to hear what your thoughts

are about what the numbers might actually be.

Isaac Turiel:

Do you feel the end user prices are inaccurate? I know these mark ups are inaccurate. I

certainly understand that.

Bob Wisbey:

Yes, we do feel the end user price are inaccurate because (not audible) use the

inaccurate mark up. In October we provided a very extensive (not audible) of what we

thought was (not audible) Our opinion have not changed on this. The work that you

have done here that you've got (not audible) touches on an area that reconfirm that the

distributor prices were for ballast sales as opposed to ballast incorporated in fixtures, was

correct and we are (not audible) in the previous study. But the dominant (not audible) i

n your study 63% of the ballast to different users and we agree with the 63% as being a

reasonable estimate. 63% of the ballast to different users as part of (not audible)

Isaac Turiel:

I am still not clear about the differential price between the magnetic and electronic.

I haven't really got a picture yet. Are you think it should be higher, lower, the same?

Just the differential. The difference.

19

EE-RM-97-500 COMMENT 21OO

fairly simple to do. Because the ballast is adds (not audible) 

(there are about three or four persons speaking all a one time) 

Mark Perlis, DSMO: 

The point that you (not audible) vastly different mark up for magnetic ballast and the 

electronic ballast in these analysis. Typically in the study used 84% mark up for magnetic· 

ballasts and 38% for electronic ballasts. We believe that the (not audible) the new work 

that was presented relates to the pricing ballast sold (not audible) We never objected to 

the pricing of (not audible) 

Doug Brookman: 

And I am sure the Department and LBNL would like to hear what your thoughts 

are about what the numbers might actually be. 

Isaac Turiel: 

Do you feel the end user prices are inaccurate? I know these mark ups are inaccurate. I 

certainly understand that. 

Bob Wisbey: 

Yes, we do feel the end user price are inaccurate because (not audible) use the 

inaccurate mark up. In October we provided a very extensive (not audible) of what we 

thought was (not audible) Our opinion have not changed on this. The work that you 

have done here that you've got (not audible) touches on an area that reconfinn that the 

distributor prices were for ballast sales as opposed to ballast incorporated in fixtures, was 

correct and we are (not audible) in the previous study. But the dominant (not audible) i 

n your study 63% of the ballast to different users and we agree with the 63% as being a 

reasonable estimate. 63% ofthe ballast to different users as part of (not audible) 

Isaac Turiel: 

I am still not clear about the differential price between the magnetic and electronic. 

I haven't really got a picture yet. Are you think it should be higher, lower, the same? 

Just the differential. The difference. 

19 

fairly simple to do. Because the ballast is adds (not audible) 

(there are about three or four persons speaking all a one time) 

Mark Perlis, DSMO: 

The point that you (not audible) vastly different mark up for magnetic ballast and the 

electronic ballast in these analysis. Typically in the study used 84% mark up for magnetic· 

ballasts and 38% for electronic ballasts. We believe that the (not audible) the new work 

that was presented relates to the pricing ballast sold (not audible) We never objected to 

the pricing of (not audible) 

Doug Brookman: 

And I am sure the Department and LBNL would like to hear what your thoughts 

are about what the numbers might actually be. 

Isaac Turiel: 

Do you feel the end user prices are inaccurate? I know these mark ups are inaccurate. I 

certainly understand that. 

Bob Wisbey: 

Yes, we do feel the end user price are inaccurate because (not audible) use the 

inaccurate mark up. In October we provided a very extensive (not audible) of what we 

thought was (not audible) Our opinion have not changed on this. The work that you 

have done here that you've got (not audible) touches on an area that reconfinn that the 

distributor prices were for ballast sales as opposed to ballast incorporated in fixtures, was 

correct and we are (not audible) in the previous study. But the dominant (not audible) i 

n your study 63% of the ballast to different users and we agree with the 63% as being a 

reasonable estimate. 63% ofthe ballast to different users as part of (not audible) 

Isaac Turiel: 

I am still not clear about the differential price between the magnetic and electronic. 

I haven't really got a picture yet. Are you think it should be higher, lower, the same? 

Just the differential. The difference. 

19 
Unknown:

We provided all this in our October comments. (not audible)

Doug Brookman:

Additional comments on this point before we move back to the presentation.

Gene Foley:

The only reason there would be problem is get some how a (not audibleO ballast

incorporated in a fixture (not audible) A fixture manufacture marked up the

ballast more going into a fixture than it would be marked up going (not audible)

distribution?

Unknown:

A fixture manufacture doesn't even touch a ballast going straight to distribution

(not audible)

Gene Foley:

Mark up as a process (not audible)

Unknown:

It is our contention that the mark up of the magnetic vs electronic ballast in terms

of percentage mark up are much (not audible)

Mike Rivest:

Thank you clarifying that.

Robert Pelino, Transformer Company:

Page 10 caption, Ballast Price Rationale. I don't see any rationale for there being

no change in prices for the TSD's?

Isaac Turiel:

You are saying why did we lower that differential? The rational was it was not

a very big change and that's really the only rationale. It was only about 11 or 12%

differential.. In other words the differential is about 11 % lower according to this

survey that we had used in the report.

20

EE-RM-97-500 COMMENT 21OO

Unknown: 

We provided all this in our October comments. (not audible) 

Doug Brookman: 

Additional comments on this point before we move back to the presentation. 

Gene Foley: 

The only reason there would be problem is get some how a (not audibleO ballast 

incorporated in a fixture (not audible) A fixture manufacture marked up the 

ballast more going into a fixture than it would be marked up going (not audible) 

distribution? 

Unknown: 

A fixture manufacture doesn't even touch a ballast going straight to distribution 

(not audible) 

Gene Foley: 

Mark up as a process (not audible) 

Unknown: 

It is our contention that the mark up of the magnetic vs electronic ballast in terms 

of percentage mark up are much (not audible) 

Mike Rivest: 

Thank you clarifying that. 

Robert Pelino, Transformer Company: 

Page 10 caption, Ballast Price Rationale. I don't see any rationale for there being 

no change in prices for the TSD's? 

Isaac Turiel: 

You are saying why did we lower that differential? The rational was it was not 

a very big change and that's really the only rationale. It was only about 11 or 12% 

differential.. In other words the differential is about 11 % lower according to this 

survey that we had used in the report. 

20 

Unknown: 

We provided all this in our October comments. (not audible) 

Doug Brookman: 

Additional comments on this point before we move back to the presentation. 

Gene Foley: 

The only reason there would be problem is get some how a (not audibleO ballast 

incorporated in a fixture (not audible) A fixture manufacture marked up the 

ballast more going into a fixture than it would be marked up going (not audible) 

distribution? 

Unknown: 

A fixture manufacture doesn't even touch a ballast going straight to distribution 

(not audible) 

Gene Foley: 

Mark up as a process (not audible) 

Unknown: 

It is our contention that the mark up of the magnetic vs electronic ballast in terms 

of percentage mark up are much (not audible) 

Mike Rivest: 

Thank you clarifying that. 

Robert Pelino, Transformer Company: 

Page 10 caption, Ballast Price Rationale. I don't see any rationale for there being 

no change in prices for the TSD's? 

Isaac Turiel: 

You are saying why did we lower that differential? The rational was it was not 

a very big change and that's really the only rationale. It was only about 11 or 12% 

differential.. In other words the differential is about 11 % lower according to this 

survey that we had used in the report. 

20 
Barbara Atkinson, Lawrence Berekely National Laboratory:

The price differential for the 4 foot was lower so keeping prices the same (not

audible)

Doug Brookman:

Barbara, please say that again.

Barbara Atkinson:

The price difference at least for that piece of the market was now lower. To

keep this price difference rather than reduce the price.

Isaac Turiel:

Yes. That's more cost effective.

Doug Brookman:

Additional questions before we move on with the presentation.

Mark Perlis:

I think you might want to reanalyze ...

Doug Brookman:

Mark, do you think you speak into that microphone.

Mark Perlis:

The table that says Comparison of Ballast Prices , when you're comparing the

various price in Draft Report, are the price in the Draft Report (not audible) you have

there.

Isaac Turiel:

Yes, taken off the end user price.

Mark Perlis:

That includes the contractor mark up price?

Isaac Turiel:

Right. The one right above it says Average plus 13%.

21

EE-RM-97-500 COMMENT 21OO

Barbara Atkinson, Lawrence Berekely National Laboratory: 

The price differential for the 4 foot was lower so keeping prices the same (not 

audible) 

Doug Brookman: 

Barbara, please say that again. 

Barbara Atkinson: 

The price difference at least for that piece of the market was now lower. To 

keep this price difference rather than reduce the price. 

Isaac Turiel: 

Yes. That's more cost effective. 

Doug Brookman: 

Additional questions before we move on with the presentation. 

Mark Pedis: 

I think you might want to reanalyze ... 

Doug Brookman: 

:Mark, do you think you speak into that microphone. 

Mark Pedis: 

The table that says Comparison of Ballast Prices, when you're comparing the 

various price in Draft Report, are the price in the Draft Report (not audible) you have 

there. 

Isaac Turiel: 

Yes, taken off the end user price. 

Mark Pedis: 

That includes the contractor mark up price? 

Isaac Turiel: 

Right. The one right above it says Average plus 13%. 

21 

Barbara Atkinson, Lawrence Berekely National Laboratory: 

The price differential for the 4 foot was lower so keeping prices the same (not 

audible) 

Doug Brookman: 

Barbara, please say that again. 

Barbara Atkinson: 

The price difference at least for that piece of the market was now lower. To 

keep this price difference rather than reduce the price. 

Isaac Turiel: 

Yes. That's more cost effective. 

Doug Brookman: 

Additional questions before we move on with the presentation. 

Mark Pedis: 

I think you might want to reanalyze ... 

Doug Brookman: 

:Mark, do you think you speak into that microphone. 

Mark Pedis: 

The table that says Comparison of Ballast Prices, when you're comparing the 

various price in Draft Report, are the price in the Draft Report (not audible) you have 

there. 

Isaac Turiel: 

Yes, taken off the end user price. 

Mark Pedis: 

That includes the contractor mark up price? 

Isaac Turiel: 

Right. The one right above it says Average plus 13%. 

21 
Okay. Turning to another controversal subject. Now we'll talk about Ballast

Lifetime. There are a lot of comments about ballast lifetime. I'll tell you what we

did on the Draft Report. We used 45,000 hours for both magnetic and electronic

ballasts and there were point sensitivities of a higher number 60,000 and lower 33,000

hours. And we also did a probability-based sensitivity analysis with a distribution of

lifetimes. So that's what was done before. What's proposed for this Technical, Support

Document is to use 50,000 hours which is not very much different for both magnetic and

electronic ballasts with point sensitivities of 80,000 and 33,000 hours. And a new

distribution could be used for probability-based sensitivity analysis which is based upon

data on reports from T&J Enterprises on Replacement Rates of Electronic and Magnetic

ballasts. By the way there is a memo which in hard copy available at the desk when you

came in. I don't know if you all have taken it but it is there, it's on the second table.

This view graft here shows data than comes out that memo that was sent to LBL by T&J

Enterprises. And what it says is the cumulative failure probability. It tells you for

example, magnetic ballast 50% would fail acoxding to this theoretical analysis by about

50,000 hours roughly. And it's nct to different in terms of the 50% mark for the electronic

ballast. They are both very equal. There are a number of assumptions that go into this

that are listed in that memo to help you out. Today, there really are no good standards

that we know of that would tell you what those lifetimes should really be. If there were

they probability there very (not audible) ---how reliable these ballasts are. So, if you knew

how good eight years ago you can imagine how useful that would be in terms of how

good there are going to be now or three years from now. That's the reason for doing this

theoretical analysis, it was in response to comments that were made, that this could

be done. So what comes out of this is that replacement lifetime of 50% of

the magnetic and electronic ballasts was calculated by this memo. And half of them

are replace, magnetic by 52,00 hours and electronic at 56,500 hours. And at 50,000

hours is being proposed as the lifetime, consistent with previous stakeholder comments

22

EE-RM-97-500 COMMENT 21OO

Okay. Turning to another controversal subject. Now we'll talk about Ballast 

Lifetime. There are a lot of comments about ballast lifetime. I'll tell you what we 

did on the Draft Report. We used 45,000 hours for both magnetic and electronic 

ballasts and there were point sensitivities of a higher number 60,000 and lower 33,000 

hours. And we also did a probability-based sensitivity analysis with a distribution of 

lifetimes. So that's what was done before. What's proposed for this Technical Support 

Document is to use 50,000 hours which is not very much different for both magnetic and 

electronic ballasts with point sensitivities of 80,000 and 33,000 hours. And a new 

distribution could be used for probability-based sensitivity analysis which is based upon 

data on reports from T&J Enterprises on Replacement Rates of Electronic and Magnetic 

ballasts. By the way there is a memo which in hard copy available at the desk when you 

came in. I don't know if you all have taken it but it is there, it's on the second table. 

This view graft here shows data thaT comes out that memo that was sent to LBL by T &J 

Enterprises. And what it says i.e;; the cumulative failure probability. It tells you for 

example, magnetic ballast 50% wO~Jld fail according to this theoretical analysis by about 

50,000 hours roughly. And it's net to different in terms of the 50% mark for the electronic 

ballast. They are both very equal. There are a number of assumptions that go into this 

that are listed in that memo to help you out. Today, there really are no good standards 

that we know of that would tell you 'Nhat those lifetimes should really be. If there were 

they probability there very (not audible) ---how reliable these ballasts are. So, if you knew 

how good eight years ago you can imagine how useful that would be in terms of how 

good there are going to be now or three years from now. That's the reason for doing thi.§ 

theoretical analysis, it was in response to comments that were made, that this could 

be done. So what comes out of this is that replacement lifetime of50% of 

the magnetic and electronic ballasts was calculated by this memo. And half of them 

are replace, magnetic by 52,00 hours and electronic at 56,500 hours. And at 50,000 

hours is being proposed as the lifetime, consistent with previous stakeholder comments 

22 

Okay. Turning to another controversal subject. Now we'll talk about Ballast 

Lifetime. There are a lot of comments about ballast lifetime. I'll tell you what we 

did on the Draft Report. We used 45,000 hours for both magnetic and electronic 

ballasts and there were point sensitivities of a higher number 60,000 and lower 33,000 

hours. And we also did a probability-based sensitivity analysis with a distribution of 

lifetimes. So that's what was done before. What's proposed for this Technical Support 

Document is to use 50,000 hours which is not very much different for both magnetic and 

electronic ballasts with point sensitivities of 80,000 and 33,000 hours. And a new 

distribution could be used for probability-based sensitivity analysis which is based upon 

data on reports from T&J Enterprises on Replacement Rates of Electronic and Magnetic 

ballasts. By the way there is a memo which in hard copy available at the desk when you 

came in. I don't know if you all have taken it but it is there, it's on the second table. 

This view graft here shows data thaT comes out that memo that was sent to LBL by T &J 

Enterprises. And what it says i.e;; the cumulative failure probability. It tells you for 

example, magnetic ballast 50% wO~Jld fail according to this theoretical analysis by about 

50,000 hours roughly. And it's net to different in terms of the 50% mark for the electronic 

ballast. They are both very equal. There are a number of assumptions that go into this 

that are listed in that memo to help you out. Today, there really are no good standards 

that we know of that would tell you 'Nhat those lifetimes should really be. If there were 

they probability there very (not audible) ---how reliable these ballasts are. So, if you knew 

how good eight years ago you can imagine how useful that would be in terms of how 

good there are going to be now or three years from now. That's the reason for doing thi.§ 

theoretical analysis, it was in response to comments that were made, that this could 

be done. So what comes out of this is that replacement lifetime of50% of 

the magnetic and electronic ballasts was calculated by this memo. And half of them 

are replace, magnetic by 52,00 hours and electronic at 56,500 hours. And at 50,000 

hours is being proposed as the lifetime, consistent with previous stakeholder comments 

22 
that have been made that a lot of people say it should be around 50,000 hours based on

their experience and knowledge. We haven't see the data. We recommending here 50,000

hours for ballast lifetime.

Bob Wisbey:

I think the change to 50,000 hours is certainly something we have no problem with.

In fact, I think, in a workshop several years ago at least suggested that 50,000 hours was

probably the most recent number used (not audible) We have no objection whatsoever

to the change of 45,000 to 50,000. We do have a minor disagreement with the sensitivity

analysis (not audible) and this is a general standard that deals with (not audible) which

we feel that in sensitivity analysis that are being made, they should be made so that balance

around the average point. In this case here 33,000 hours to (not audible)

Doug Brookman:

And again can you say what the, for those of us who are straining to remember

these sensitivity analysis, i.e. What is the benefit of doing it that way would be?

Bob Wisbey:

When it's done unbalanced you can wind up presenting and showing a very

distorted view as part of the sensitivities are.

Doug Brookman:

Thank you for the remarks on proving something rather that (laughter -- not

audible) Let me acknowledge also that the Department now has better copies of the

(laughter - not audible) are available over here with Sandy and Brenda. Copies of page 7,

8 and 11. Additional questions for Isaac or comments.

Gene Foley:

Just to refresh my memory, why was 80 and 33 chosen, was there any rationale

to this?

23

EE-RM-97-500 COMMENT 21OO

that have been made that a lot of people say it should be around 50,000 hours based on 

their experience and knowledge. We haven't see the data. We recommending here 50,000 

hours for ballast lifetime. 

Bob Wisbey: 

I think the change to 50,000 hours is certainly something we have no problem with. 

In fact, I think, in a workshop several years ago at least suggested that 50,000 hours was 

probably the most recent number used (not audible) We have no objection whatsoever 

to the change of 45,000 to 50,000. We do have a minor disagreement with the sensitivity 

analysis (not audible) and this is a general standard that deals with (not audible) which 

we feel that in sensitivity analysis that are being made, they should be made so that balance 

around the average point. In this case here 33,000 hours to (not audible) 

Doug Brookman: 

And again can you say what the. for those of us who are straining to remember 

these sensitivity analysis, i.e. what is the benefit of doing it that way would be? 

Bob Wisbey: 

When it's done unbalfu"1ced you can wind up presenting and showing a very 

distorted view as part of the sensitivities are. 

Doug Brookman: 

Thank you for the remarks on proving something rather that (laughter -- not 

audible) Let me acknowledge also that the Department now has better copies of the 

(laughter - not audible) are available over here with Sandy and Brenda. Copies of page 7, 

8 and 11. Additional questions for Isaac or comments. 

Gene Foley: 

Just to refresh my memory, why was 80 and 33 chosen, was there any rationale 

to this? 

23 

that have been made that a lot of people say it should be around 50,000 hours based on 

their experience and knowledge. We haven't see the data. We recommending here 50,000 

hours for ballast lifetime. 

Bob Wisbey: 

I think the change to 50,000 hours is certainly something we have no problem with. 

In fact, I think, in a workshop several years ago at least suggested that 50,000 hours was 

probably the most recent number used (not audible) We have no objection whatsoever 

to the change of 45,000 to 50,000. We do have a minor disagreement with the sensitivity 

analysis (not audible) and this is a general standard that deals with (not audible) which 

we feel that in sensitivity analysis that are being made, they should be made so that balance 

around the average point. In this case here 33,000 hours to (not audible) 

Doug Brookman: 

And again can you say what the. for those of us who are straining to remember 

these sensitivity analysis, i.e. what is the benefit of doing it that way would be? 

Bob Wisbey: 

When it's done unbalfu"1ced you can wind up presenting and showing a very 

distorted view as part of the sensitivities are. 

Doug Brookman: 

Thank you for the remarks on proving something rather that (laughter -- not 

audible) Let me acknowledge also that the Department now has better copies of the 

(laughter - not audible) are available over here with Sandy and Brenda. Copies of page 7, 

8 and 11. Additional questions for Isaac or comments. 

Gene Foley: 

Just to refresh my memory, why was 80 and 33 chosen, was there any rationale 

to this? 

23 
Isaac Turiel:

The 33,000 came again from this LRI study made by the Lighting Maintenance

Company and that was a number that they had come up with. That 33,000 hours.

The 80,000 hours, there have been some comments by some manufactures who

make electronic ballast that 80,000 something hours is something that is quite feasible

if not already feasible.

Richard Rattray, OSRAM Sylvania:

I just wanted to make a point that originally that high sensitivity was actually

60,000 hours not 80,0)0 and that was a change that was made (no audible) and

that was the first time we heard it was a comment from a manufacture. (not

audible)

Doug Brookman:

Any additional comments and data would be welcomed by the Department.

Barbara Atkinson:

The comments would be whether we chose these two numbers for the single value

sensitivity. we're also going to do (not audible) analysis due to the (not audible)

from the T&J Enterprises report.

Isaac Turiel:

Right. Thanks Barbara. Now lets turn to Electricity Prices and in the 1997 report

the data we used was EIA;'s AEO 1997 report. And we used the same electricity prices.

The bottom section is not shown, we have another gap in the data.

Sector Low Average High

Commercial $.055 $.075 $.105

Industrial $.030 $.048 $.065

24

EE-RM-97-500 COMMENT 21OO

Isaac Turiel: 

The 33,000 came again from this LRI study made by the Lighting Maintenance 

Company and that was a number that they had come up with. That 33,000 hours. 

The 80,000 hours, there have been some comments by some manufactures who 

make electronic ballast that 80,000 something hours is something that is quite feasible 

if not already feasible. 

Richard Rattray, OSRAM Sylvania: 

I just wanted to make a point that originally that high sensitivity was actually 

60,000 hours not 80,000 and that was a change that was made (no audible) and 

that was the first time we heard it was a comment from a manufacture. (not 

audible) 

Doug Brookman: 

Any additional comment., and data would be welcomed by the Department. 

Barbara Atkinson: 

The comments would be whether we chose these two numbers for the single value 

sensitivity. we're also going to do (not audible) analysis due to the (not audible) 

from the T &J Enterprises report. 

Isaac Turiel: 

Right. Thanks Barbara. Now lets turn to Electricity Prices and in the 1997 report 

the data we used was EIA;'s AEO 1997 report. And we used the same electricity prices. 

The bottom section is not shown, we have another gap in the data. 

Sector 

Commercial 

Industrial 

Low 

$.055 

$.030 

Average 

$.075 

$.048 

24 

High 

$ .105 

$.065 

Isaac Turiel: 

The 33,000 came again from this LRI study made by the Lighting Maintenance 

Company and that was a number that they had come up with. That 33,000 hours. 

The 80,000 hours, there have been some comments by some manufactures who 

make electronic ballast that 80,000 something hours is something that is quite feasible 

if not already feasible. 

Richard Rattray, OSRAM Sylvania: 

I just wanted to make a point that originally that high sensitivity was actually 

60,000 hours not 80,000 and that was a change that was made (no audible) and 

that was the first time we heard it was a comment from a manufacture. (not 

audible) 

Doug Brookman: 

Any additional comment., and data would be welcomed by the Department. 

Barbara Atkinson: 

The comments would be whether we chose these two numbers for the single value 

sensitivity. we're also going to do (not audible) analysis due to the (not audible) 

from the T &J Enterprises report. 

Isaac Turiel: 

Right. Thanks Barbara. Now lets turn to Electricity Prices and in the 1997 report 

the data we used was EIA;'s AEO 1997 report. And we used the same electricity prices. 

The bottom section is not shown, we have another gap in the data. 

Sector 

Commercial 

Industrial 

Low 

$.055 

$.030 

Average 

$.075 

$.048 

24 

High 

$ .105 

$.065 
The average prices were used for all years in the LCC calculations. And we also did a

probabilty-based sensitivity analysis which was performed with 1995 investor-owned and

1994 publicly-owned utility sales and revenue data. the high and low single-value

sensitivities were used and that is shown in the box here [above]. Those were the values

shown in the 1997 report.

Carl Adams:

Let me just say those number are on page 8 of the Summary of Inputs for the

Technical Support Document.

Isaac Turiel:

That was the additional handout page 8. [dated April 20, 1998]

In the TSD proposal is now to make a change in Life Cycle Cost Analysis

and use a time Series of Average Prices from EIA's AEO updated in the 1998 report.

that is a little different than we've done before. And the Probability-based Sensitivity

Analysis we propose to do the same way but we would update it with new data from

electric utility companies. And again from recent distribution form we select values near

the endpoints of these distributions as we said before. The rationale for doing that is that

a time series of electricity prices would provide more accurate picture when prices are

changing -- whether they are going up or down -- will be put into the LCC analysis that

we will be doing next. In the sensitivity analysis will be performed again because there is

a large variability in electricity prices and we want to be able to reflect that in the analysis.

We are proposing to use average prices as opposed to marginal prices. For the commercial

sector and the industrial sector the marginal prices are a function of both kW demand and

kWh energy use charges and these vary by season, by the utility area, by the facility

whatever arrangement they may have with their utility companies, and it is very difficult

to make any kind of accurate determination unless you go building by building.

There is also the Advisory Committee which is looking into that. There is a

25

EE-RM-97-500 COMMENT 21OO

The average prices were used for all years in the LCC calculations. And we also did a 

probabilty-based sensitivity analysis which was performed with 1995 investor-owned and 

1994 publicly-owned utility sales and revenue data. the high and low single-value 

sensitivities were used and that is shown in the box here [above]. Those were the values 

shown in the 1997 report. 

Carl Adams: 

Let me just say those number are on page 8 of the Summary of Inputs for the 

Technical Support Document. 

Isaac Turiel: 

That was the additional handout page 8. [dated April 20, 1998] 

In the TSD proposal is now to make a change in Life Cycle Cost Analysis 

and use a time Series of Average Prices from EIA's AEO updated in the 1998 report. 

that is a little different than we've done before. And the Probability-based Sensitivity 

Analysis we propose to do the same way but we would update it with new data from 

electric utility companies. And again from recent distribution form we select values near 

the endpoints of these distributions as we said before. The rationale for doing that is that 

a time series of electricity prices would provide more accurate picture when prices are 

changing -- whether they are going up or down -- will be put into the LCC analysis that 

we will be doing next. In the sensitivity analysis will be performed again because there is 

a large variability in electricity prices and we want to be able to reflect that in the analysis. 

We are proposing to use average prices as opposed to marginal prices. For the commercial 

sector and the industrial sector the marginal prices are a function of both kW demand and 

kWh energy use charges and these vary by season, by the utility area, by the facility 

whatever arrangement they may have with their utility companies, and it is very difficult 

to make any kind of accurate determination unless you go building by building. 

There is also the Advisory Committee which is looking into that. There is a 

25 

The average prices were used for all years in the LCC calculations. And we also did a 

probabilty-based sensitivity analysis which was performed with 1995 investor-owned and 

1994 publicly-owned utility sales and revenue data. the high and low single-value 

sensitivities were used and that is shown in the box here [above]. Those were the values 

shown in the 1997 report. 

Carl Adams: 

Let me just say those number are on page 8 of the Summary of Inputs for the 

Technical Support Document. 

Isaac Turiel: 

That was the additional handout page 8. [dated April 20, 1998] 

In the TSD proposal is now to make a change in Life Cycle Cost Analysis 

and use a time Series of Average Prices from EIA's AEO updated in the 1998 report. 

that is a little different than we've done before. And the Probability-based Sensitivity 

Analysis we propose to do the same way but we would update it with new data from 

electric utility companies. And again from recent distribution form we select values near 

the endpoints of these distributions as we said before. The rationale for doing that is that 

a time series of electricity prices would provide more accurate picture when prices are 

changing -- whether they are going up or down -- will be put into the LCC analysis that 

we will be doing next. In the sensitivity analysis will be performed again because there is 

a large variability in electricity prices and we want to be able to reflect that in the analysis. 

We are proposing to use average prices as opposed to marginal prices. For the commercial 

sector and the industrial sector the marginal prices are a function of both kW demand and 

kWh energy use charges and these vary by season, by the utility area, by the facility 

whatever arrangement they may have with their utility companies, and it is very difficult 

to make any kind of accurate determination unless you go building by building. 

There is also the Advisory Committee which is looking into that. There is a 

25 
meeting next week and we will be looking to see what they have to say after that

meeting.

Bob Wisbey:

First of all, we agree with the concept of using the Time Series of Average Prices

over time. There is a major issue with the point that Glenn was just making. Slides I

put out there right now is an excerpt from the Formal Recommendations of the

Advisory Committee for DoE. This Formal Recommendation that has been

sent, as I understand at this point, from Dan Reicher to the Secretary. And it

says very simply for its Life Cycle Cost Analysis and all future rulemaking by the

Department of Energy and its Contractors should replace the use of Average

Energy Prices with Marginal Energy Prices. I don't think that given the climate

of the process improvement of the process the DoE has undergone in this area

and given the establishment of the Formal Advisory Committee, I do not feel

in my interpretation that either LBNL or DoE really has reasonable option to

disregard this advice. They have asked for advice, it has been formally prepared

and it says it shall use the marginal electricity price. I certainly agree with what

Isaac is saying it's very difficult to determine: I'm a little bit puzzled by the

inability to get some information because this work was originally dxlone by the

Economic Subcommittee of the Advisory Committee. I am a member of that

subcommittee. I have sat in all of the meetings. A great amount of data and

discussion has taken place within that subcommittee regarding this very subject.

In fact, a large body of data was presented for discussion in the group that

shows the difference between average price and the marginal price is in the

range of 7 to 11 %. And the comments that we provided in October, we

suggested using 10% as a difference between average and marginal means.

Average prices realitivily is easy to access. Marginal prices vary widely from

26

EE-RM-97-500 COMMENT 21OO

meeting next week and we will be looking to see what they have to say after that 

meeting. 

Bob Wisbey: 

First of all, we agree with the concept of using the Time Series of Average Prices 

over time. There is a major issue with the point that Glenn was just making. Slides I 

put out there right now is an excerpt from the Formal Recommendations of the 

Advisory Committee for DoE. This Formal Recommendation that has been 

sent, as I understand at this point, from Dan Reicher to the Secretary. And it 

says very simply for its Life Cycle Cost Analysis and all future rulemaking by the 

Department of Energy and its Contractors should replace the use of Average 

Energy Prices with Marginal Energy Prices. I don't think that given the climate 

of the process improvement ofthe process the DoE has undergone in this area 

and given the establishment of the Formal Advisory Committee, I do not feel 

in my interpretation that either LBNL or DoE really has reasonable option to 

disregard this advice. They have asked for advice, it has been formally prepared 

and it says it shall use the marginal electricity price. I certainly agree with what 

Isaac is saying it's very difficult to determine~ I'm a little bit puzzled by the 

inability to get some information because this work was originally done by the 

Economic Subcommittee of the Advisory Committee. I am a member of that 

subcommittee. I have sat in all ofthe meetings. A great amount of data and 

discussion has taken place within that subcommittee regarding this very subject. 

In fact, a large body of data was presented for discussion in the group that 

shows the difference between average price and the marginal price is in the 

range of 7 to 11 %. And the comments that we provided in October, we 

suggested using 10% as a difference between average and marginal means. 

Average prices realitivily is easy to access. Marginal prices vary widely from 

26 

meeting next week and we will be looking to see what they have to say after that 

meeting. 

Bob Wisbey: 

First of all, we agree with the concept of using the Time Series of Average Prices 

over time. There is a major issue with the point that Glenn was just making. Slides I 

put out there right now is an excerpt from the Formal Recommendations of the 

Advisory Committee for DoE. This Formal Recommendation that has been 

sent, as I understand at this point, from Dan Reicher to the Secretary. And it 

says very simply for its Life Cycle Cost Analysis and all future rulemaking by the 

Department of Energy and its Contractors should replace the use of Average 

Energy Prices with Marginal Energy Prices. I don't think that given the climate 

of the process improvement ofthe process the DoE has undergone in this area 

and given the establishment of the Formal Advisory Committee, I do not feel 

in my interpretation that either LBNL or DoE really has reasonable option to 

disregard this advice. They have asked for advice, it has been formally prepared 

and it says it shall use the marginal electricity price. I certainly agree with what 

Isaac is saying it's very difficult to determine~ I'm a little bit puzzled by the 

inability to get some information because this work was originally done by the 

Economic Subcommittee of the Advisory Committee. I am a member of that 

subcommittee. I have sat in all ofthe meetings. A great amount of data and 

discussion has taken place within that subcommittee regarding this very subject. 

In fact, a large body of data was presented for discussion in the group that 

shows the difference between average price and the marginal price is in the 

range of 7 to 11 %. And the comments that we provided in October, we 

suggested using 10% as a difference between average and marginal means. 

Average prices realitivily is easy to access. Marginal prices vary widely from 

26 
installation to installation, from place to place etc. But some reasonable

estimate must be used. And with this Formal Recommendation, we don't

really believe it's optional to go back and continue to use the average price.

Doug Broo :

Thank you. Comments, questions following on Bob's slide.

Isaac Turiel:

(not audible) 10%, I could be wrong, and I ask someone from DoE to

answer that. I felt that was only for residential that Steven Rosenstock

had done those calculations for. Carl, you were there perhaps you can

comment.

Carl Adams:

I believe that is true that the data that was presented by the subcommittee

had to do with residential. It did not get into the demand charges.

(portion not audible -- several persons speaking)

Bob Wisbey:

I was under the impression that, that was (not audible) but I was prepared to

argue the point by any means. It was an aggregated number is my impression.

Mark Perlis:

Isaac, there is another document over here on the table that appears to be a

computer spreadsheet. The first page Energy Saving and New Present Values for

Ballasts.

Isaac Turiel:

We're going to talk about that later.

Mark Perlis:

Well when you get into the electricity price projections then on the left side it

says EIA Annual Energy Outlook 1998 and it has a time period for commercial

and industrial electricity prices.

27

EE-RM-97-500 COMMENT 21OO

installation to installation, from place to place etc. But some reasonable 

estimate must be used. And with this Formal Recommendation, we don't 

really believe it's optional to go back and continue to use the average price. 

Doug Brookman: 

Thank you. Comments, questions following on Bob's slide. 

Isaac Turiel: 

(not audible) 10%, I could be wrong, and I ask someone from DoE to 

answer that. I felt that was only for residential that Steven Rosenstock 

had done those calculations for. Carl, you were there perhaps you can 

comment. 

Carl Adams: 

I believe that is true that the data that was presented by the subcommittee 

had to do with residential. It did not get into the demand charges. 

(portion not audible -- several persons speaking) 

Bob Wisbey: 

I was under the impression that, that was (not audible) but I was prepared to 

argue the point by any means. It was an aggregated number is my impression. 

Mark Pertis: 

Isaac, there is another document over here on the table that appears to be a 

computer spreadsheet. The first page Energy Saving and New Present Values for 

Ballasts . 

. Isaac Turiel: 

We're going to talk about that later. 

Mark Pedis: 

Well when you get into the electricity price projections then on the left side it 

says EIA Annual Energy Outlook 1998 and it has a time period for commercial 

and industrial electricity prices. 

27 

installation to installation, from place to place etc. But some reasonable 

estimate must be used. And with this Formal Recommendation, we don't 

really believe it's optional to go back and continue to use the average price. 

Doug Brookman: 

Thank you. Comments, questions following on Bob's slide. 

Isaac Turiel: 

(not audible) 10%, I could be wrong, and I ask someone from DoE to 

answer that. I felt that was only for residential that Steven Rosenstock 

had done those calculations for. Carl, you were there perhaps you can 

comment. 

Carl Adams: 

I believe that is true that the data that was presented by the subcommittee 

had to do with residential. It did not get into the demand charges. 

(portion not audible -- several persons speaking) 

Bob Wisbey: 

I was under the impression that, that was (not audible) but I was prepared to 

argue the point by any means. It was an aggregated number is my impression. 

Mark Pertis: 

Isaac, there is another document over here on the table that appears to be a 

computer spreadsheet. The first page Energy Saving and New Present Values for 

Ballasts . 

. Isaac Turiel: 

We're going to talk about that later. 

Mark Pedis: 

Well when you get into the electricity price projections then on the left side it 

says EIA Annual Energy Outlook 1998 and it has a time period for commercial 

and industrial electricity prices. 

27 
Isaac Turiel:

Yes.

Mark Perlis:

Are those the rates that you are planning to use?

Isaac Turiel:

At the moment unless we have different directions.

Mark Perlis:

That raises the question in my mind because the annual energy outlook

that I have has different prices than the ones you have on that sheet.

Isaac Turiel:

Are they the same dollars?

Mark Perlis:

Yes, in kW hours.

Isaac Turiel:

No, I mean for the same year.

Mark Perlis:

In 1997 dollars, 95 dollars. Sometimes they can be a little different.

Isaac Turiel:

Yes, I don't have 1997. 1 do have 2000.

Mark Perlis:

But those are '97 dollars.

Isaac Turiel:

They are expressed in'97 dollars. I don't know if what you are looking at

is also expressed in '97 dollars.

Mark Perlis:

What year did the AEO '98 express their dollars?

Isaac Turiel:

28

EE-RM-97-500 COMMENT 21OO

Isaac Turie!: 

Yes. 

Mark Perlis: 

Are those the rates that you are planning to use? 

Isaac Turie!: 

At the moment unless we have different directions. 

Mark Perlis: 

That raises the question in my mind because the annual energy outlook 

that I have has different prices than the ones you have on that sheet. 

Isaac Turie!: 

Are they the same dollars? 

Mark Perlis: 

Yes, in k W hours. 

Isaac Turiel: 

No, I mean for the same year. 

Mark Perlis: 

In 1997 dollars, 95 dollars. Sometimes they can be a little different. 

Isaac Turiel: 

Yes, I don't have 1997. I do have 2000. 

Mark Perlis: 

But those are '97 dollars. 

Isaac Turie!: 

They are expressed in '97 dollars. I don't know if what you are looking at 

is also expressed in '97 dollars. 

Mark Perlis: 

What year did the ABO '98 express their dollars? 

Isaac Turie!: 

28 

Isaac Turie!: 

Yes. 

Mark Perlis: 

Are those the rates that you are planning to use? 

Isaac Turie!: 

At the moment unless we have different directions. 

Mark Perlis: 

That raises the question in my mind because the annual energy outlook 

that I have has different prices than the ones you have on that sheet. 

Isaac Turie!: 

Are they the same dollars? 

Mark Perlis: 

Yes, in k W hours. 

Isaac Turiel: 

No, I mean for the same year. 

Mark Perlis: 

In 1997 dollars, 95 dollars. Sometimes they can be a little different. 

Isaac Turiel: 

Yes, I don't have 1997. I do have 2000. 

Mark Perlis: 

But those are '97 dollars. 

Isaac Turie!: 

They are expressed in '97 dollars. I don't know if what you are looking at 

is also expressed in '97 dollars. 

Mark Perlis: 

What year did the ABO '98 express their dollars? 

Isaac Turie!: 

28 
1995 or 1996

Mark Perlis:

What you have done is inflated ...

Isaac Turiel:

Like 2%. Two percent difference that you're looking at then that can explain that.

Mark Perlis:

Okay, (not audible)

Doug Brookman:

As I understand this is to be taken up later on? Right?

Mark Perlis:

No. It's to be taken up right now. There are two other points I wanted to

make about electricity price. First is that, NEMES supports the use of the

annual energy outlook 1998. It is very important to recognize that the 1998

is the first time that EIA has really attempted annual forecast to assume

deregulation in the future. But it is doing so again in line with what Mr. Scltleede

said before (not audible) on the side of higher rather than lower electricity

prices in this respect. As I read the report, it only assumes deregulation in

three parts of the country, California, New York, and New England. No

deregulations anywhere else. That's number one. And number two, don't

really assume that there will be any competitive prices even in those parts

of the country until 2008. And I would suggest that there are many, many,

many analyst in the electricity sector who believe that those are some what

if not very pessimistic assumptions. And that is very possible if not likely

that before this was supported here, before the May NOPR, and certainly

before October of 1999 when the final rule goes out, there will be another

AEO '99 that will be out in December. And that will probably show even

lower electricity price for the out years. So there is probably a trend line

29

EE-RM-97-500 COMMENT 21OO

1995 or 1996 

Mark Perlis: 

What you have done is inflated ... 

Isaac Turiel: 

Like 2%. Two percent difference that you're looking at then that can explain that. 

Mark Perlis: 

Okay, (not audible) 

Doug Brookman: 

As I understand this is to be taken up later on? Right? 

Mark Perlis: 

No. It's to be taken up right now. There are two other points I wanted to 

make about electricity price. First is that, NEMES supports the use of the 

annual energy outlook 1998. It is very important to recognize that the 1998 

is the first time that EIA has really attempted annual forecast to assume 

deregulation in the future. But it is doing so again in line with what Mr. Scltleede 

said before (not audible) on the side of higher rather than lower electricity 

prices in this respect. As I read the report, it only assumes deregulation in 

three parts of the country, California, New York, and New England. No 

deregulations anywhere else. That's number one. And number two, don't 

really assume that there will be any competitive prices even in those parts 

ofthe country until 2008. And I would suggest that there are many, many, 

many analyst in the electricity sector who believe that those are some what 

if not very pessimistic assumptions. And that is very possible if not likely 

that before this was supported here, before the May NOPR, and certainly 

before October of 1999 when the final rule goes out, there will be another 

ABO '99 that will be out in December. And that will probably show even 

lower electricity price for the out years. So there is probably a trend line 

29 

1995 or 1996 

Mark Perlis: 

What you have done is inflated ... 

Isaac Turiel: 

Like 2%. Two percent difference that you're looking at then that can explain that. 

Mark Perlis: 

Okay, (not audible) 

Doug Brookman: 

As I understand this is to be taken up later on? Right? 

Mark Perlis: 

No. It's to be taken up right now. There are two other points I wanted to 

make about electricity price. First is that, NEMES supports the use of the 

annual energy outlook 1998. It is very important to recognize that the 1998 

is the first time that EIA has really attempted annual forecast to assume 

deregulation in the future. But it is doing so again in line with what Mr. Scltleede 

said before (not audible) on the side of higher rather than lower electricity 

prices in this respect. As I read the report, it only assumes deregulation in 

three parts of the country, California, New York, and New England. No 

deregulations anywhere else. That's number one. And number two, don't 

really assume that there will be any competitive prices even in those parts 

ofthe country until 2008. And I would suggest that there are many, many, 

many analyst in the electricity sector who believe that those are some what 

if not very pessimistic assumptions. And that is very possible if not likely 

that before this was supported here, before the May NOPR, and certainly 

before October of 1999 when the final rule goes out, there will be another 

ABO '99 that will be out in December. And that will probably show even 

lower electricity price for the out years. So there is probably a trend line 

29 
in their forecast downwards. And that (not audible) the sensitivity analysis

that we choose to perform. And I think that if anything this is an example

where you do need to have a more unbalanced on sensitivity analysis

because I think AEO is on the high side to start with. And we urge you to take

that into account and to acknowledge in your reports that we intend in the

future to rely on the latest projects that are available, because they do

expect next years projects to be very different.

Doug Brookman:

Additional comments before we go back to the presentation.

Isaac Turiel:

We always try to use the latest forecast. You might note that on that

handout that you are looking at, that there is a GRI forecast. (not audible).

That shows a stepper decline than AEO '98. (not audible)

This is the last one, I believe, Discount Rates. What we did in the 1997

Draft Report we used 4, 8, and 12% real discount rates for the LCC analysis.

What is proposed for the Technical Support Document is to use 4, 8 and 15%

discount rates real for the Life Cycle Cost analysis. The upper bound of change

to be consistent with the Interlaboratories Working Group report, also know as

the Five Lab Study, in there is a range of discount rates that were used for

the building sector, they used an upper range of 15% in that report.

And that is basically where it is. Any comments?

Doug Brookman:

I see no comments on discount rate.

Isaac Turiel:

If that's the case we will go onto the next part which is a section of what was

done. There were a number of comments made that the population being

used for annual lighting hours in terms of distribution for electricity prices

30

EE-RM-97-500 COMMENT 21OO

in their forecast downwards. And that (not audible) the sensitivity analysis 

that we choose to perform. And I think that if anything this is an example 

where you do need to have a more unbalanced on sensitivity analysis 

because I think ABO is on the high side to start with. And we urge you to take 

that into account and to acknowledge in your reports that we intend in the 

future to rely on the latest projects that are available, because they do 

expect next years projects to be very different. 

Doug Brookman: 

Additional comments before we go back to the presentation. 

Isaac Turiel: 

We always try to use the latest forecast. You might note that on that 

handout that you are looking at, that there is a GRI forecast. (not audible). 

That shows a stepper decline than ABO '98. (not audible) 

This is the last one, I believe, Discount Rates. What we did in the 1997 

Draft Report we used 4, 8, and U% real discount rates for the LCC analysis. 

What is proposed for the Techru.cal Support Document is to use 4,8 and 15% 

discount rates real for the Vfe Cycle Cost analysis. The upper bound of change 

to be consistent with the Interlaboratories Working Group report, also know as 

the Five Lab Study, in there is a range of discount rates that were used for 

the building sector, they used an upper range ofl5% in that report. 

And that is basically where it is. Any comments? 

Doug Brookman: 

I see no comments on discount rate. 

Isaac Turiel: 

If that's the case we will go onto the next part which is a section of what was 

done. There were a number of comments made that the population being 

used for annual lighting hours in terms of distribution for electricity prices 

30 

in their forecast downwards. And that (not audible) the sensitivity analysis 

that we choose to perform. And I think that if anything this is an example 

where you do need to have a more unbalanced on sensitivity analysis 

because I think ABO is on the high side to start with. And we urge you to take 

that into account and to acknowledge in your reports that we intend in the 

future to rely on the latest projects that are available, because they do 

expect next years projects to be very different. 

Doug Brookman: 

Additional comments before we go back to the presentation. 

Isaac Turiel: 

We always try to use the latest forecast. You might note that on that 

handout that you are looking at, that there is a GRI forecast. (not audible). 

That shows a stepper decline than ABO '98. (not audible) 

This is the last one, I believe, Discount Rates. What we did in the 1997 

Draft Report we used 4, 8, and U% real discount rates for the LCC analysis. 

What is proposed for the Techru.cal Support Document is to use 4,8 and 15% 

discount rates real for the Vfe Cycle Cost analysis. The upper bound of change 

to be consistent with the Interlaboratories Working Group report, also know as 

the Five Lab Study, in there is a range of discount rates that were used for 

the building sector, they used an upper range ofl5% in that report. 

And that is basically where it is. Any comments? 

Doug Brookman: 

I see no comments on discount rate. 

Isaac Turiel: 

If that's the case we will go onto the next part which is a section of what was 

done. There were a number of comments made that the population being 

used for annual lighting hours in terms of distribution for electricity prices 

30 
perhaps were not the correct ones to use. And we investigated it by looking

at the Green Lights data base and Diane Fisher is going to discuss the findings

of that research.

Diane Fisher, Lawrence Berekely National Laboratory:

Isaac has told you about many of the (not audible) estimates that were used

for important input parameters in the Life Cycle Cost analysis. In addition to

the points estimates, we also did some studies which we use distribution to represent the

likely range of values for some of these inputs that end users

would be likely to experience. And I am going to be talking about two of

those distributions, namely the electricity price distribution and the lighting

offering distribution. And I will stop after (not audible) to take questions

and then I will stop again after the lighting hours discussion. So in the draft report we

used the distribution of U.S. commercial electricity prices for utilities across the U.S. to

represent the electricity price distribution that would represent ballast end user electricity

prices. And for lighting hours we used the distribution of lighting hours found in the

XenCAP database that we used it to derive the average values of lighting hours that were

used in the analysis. And based on both of these distributions we then came up with

estimates of what fraction of end users would be Life Cycle Cost winners by either Life

Cycle Cost being reduces, and losers by Live Cycle Cost increase (not audible)

distribution. For particular technology, such as magnetic (not audible) or magnetic

to electronics, and we found based on the distributions that a rather high percentage of

end users would in fact be LCC winners. However those conclusions were questioned

and the argument was made that distribution that we used would not accurately represent

end users who would be impacted by standards because those end users who have high

electricity prices or high lighting operating hours would have been most likely to have

pushed voluntarily to more efficient ballasts. So those end users impacted by standards

would be a the lower end for both the electricity price and the lighting hour distributions,

31

EE-RM-97-500 COMMENT 21OO

perhaps were not the correct ones to use. And we investigated it by looking 

at the Green Lights data base and Diane Fisher is going to discuss the findings 

of that research. 

Diane Fisher, Lawrence Berekely National Laboratory: 

Isaac has told you about many of the (not audible) estimates that were used 

for important input parameters in the Life Cycle Cost analysis. In addition to 

the points estimates, we also did some studies which we use distribution to represent the 

likely range of values for some of these inputs that end users 

would be likely to experience. And I am going to be talking about two of 

those distributions, namely the electricity price distribution and the lighting 

offering distribution. And I will stop after (not audible) to take questions 

and then I will stop again after the lighting hours discussion. So in the draft report we 

used the distribution of U.S. commercial electricity prices for utilities across the U.S. to 

represent the electricity price distribution that would represent ballast end user electricity 

prices. And for lighting hours we used the distribution of lighting hours found in the 

XenCAP database that we used it to derive the average values of lighting hours that were 

used in the analysis. And based on both of these distributions we then came up with 

estimates of what fraction of end users would be Life Cycle Cost winners by either Life 

Cycle Cost being reduces, and losers by Live Cycle Cost increase (not audible) 

distribution. For particular technology, such as magnetic (not audible) or magnetic 

to electronics, and we found based on the distributions that a rather high percentage of 

end users would in fact be LCC winners. However those conclusions were questioned 

and the argument was made that distribution that we used would not accurately represen~ 

end users who would be impacted by standards because those end users who have high 

electricity prices or high lighting operating hours would have been most likely to have 

pushed voluntarily to more efficient ballasts. So those end users impacted by standards 

would be a the lower end for both the electricity price and the lighting hour distributions, 

31 

perhaps were not the correct ones to use. And we investigated it by looking 

at the Green Lights data base and Diane Fisher is going to discuss the findings 

of that research. 

Diane Fisher, Lawrence Berekely National Laboratory: 

Isaac has told you about many of the (not audible) estimates that were used 

for important input parameters in the Life Cycle Cost analysis. In addition to 

the points estimates, we also did some studies which we use distribution to represent the 

likely range of values for some of these inputs that end users 

would be likely to experience. And I am going to be talking about two of 

those distributions, namely the electricity price distribution and the lighting 

offering distribution. And I will stop after (not audible) to take questions 

and then I will stop again after the lighting hours discussion. So in the draft report we 

used the distribution of U.S. commercial electricity prices for utilities across the U.S. to 

represent the electricity price distribution that would represent ballast end user electricity 

prices. And for lighting hours we used the distribution of lighting hours found in the 

XenCAP database that we used it to derive the average values of lighting hours that were 

used in the analysis. And based on both of these distributions we then came up with 

estimates of what fraction of end users would be Life Cycle Cost winners by either Life 

Cycle Cost being reduces, and losers by Live Cycle Cost increase (not audible) 

distribution. For particular technology, such as magnetic (not audible) or magnetic 

to electronics, and we found based on the distributions that a rather high percentage of 

end users would in fact be LCC winners. However those conclusions were questioned 

and the argument was made that distribution that we used would not accurately represen~ 

end users who would be impacted by standards because those end users who have high 

electricity prices or high lighting operating hours would have been most likely to have 

pushed voluntarily to more efficient ballasts. So those end users impacted by standards 

would be a the lower end for both the electricity price and the lighting hour distributions, 

31 
So to examine that possibility, we looked at data from one large voluntary program

namely the EPA's Green Lights Program. We obtained an extract of that database

completed through July 30, 1997. There are a variety of measure that these

implemented but we looked at only those measures that involved installation

of electronic ballasts in retrofit situations. And that gave us 10 million

ballasts in 1.5 billion square feet. And this graft shows year by year the number

of electronic ballasts installed in Green Light projects through 1996 which is the

last year of complete data that we have. And you will see that there are up

abound 3.5 millions ballasts per year which is a significant program. That's

roughly 10% of annual electronic ballasts shipments. We used this data to do both

electricity price distribution and operating hours distribution, so we would like to compare

those to the previous distributions that we had used. So for electricity price is not directly

reported in the Green Lights project report, however they did report the dollars saved by

the project and the kWh saved by the project. And clearly they had to use electricity

prices to come up with the dolars saved. So we assume, and we calculated it

to come up the electrii^.ity price. And then we adjusted that to 1995 dollars to

be comparable with the utility data that we were using. For the distribution

of U.S commercial electricit-' prices we calculated an average price for

each utility by dividing the commercial revenues by its commercial sales

sales in kWh. These are data that were reported to the EIA which they

publish. We used 1995 data for investor-owned utilities which represented

about 80% of the market and 1994 data for publicly-owned utilities this

was the most recent data available at the time that we did the distribution.

We are proposing to update to 1996 data which is not the most recent

available. In both data sets, we then grouped the data into 1-cent intervals and

calculated the fraction in Green Light of ballasts that fell into each of these

intervals or for electricity the fraction of commercial sales that fell into each

32

EE-RM-97-500 COMMENT 21OO

So to examine that possibility, we looked at data from one large voluntary program 

namely the EPA's Green Lights Program. We obtained an extract of that database 

completed through July 30, 1997. There are a variety ofmeasure that these 

implemented but we looked at only those measures that involved installation 

of electronic ballasts in retrofit situations. And that gave us 10 million 

ballasts in 1.5 billion square feet. And this graft shows year by year the number 

of electronic ballasts installed in Green Light projects through 1996 which is the 

last year of complete data that we have. And you will see that there are up 

abound 3.5 millions ballasts per year which is a significant program. That's 

roughly 10% of annual electronic ballasts shipments. We used this data to do both 

electricity price distribution and operating hours distribution, so we would like to compare 

those to the previous distributions that we had used. So for electricity price is not directly 

reported in the Green Lights project report, however they did report the dollars saved by 

the project and the kWh saved by the project. And clearly they had to use electricity 

prices to come up with the donar~ saved. So we assume, and we calculated it 

to come up the electri;ity price. Pilld then we adjusted that to 1995 dollars to 

be comparable with the utility data that we were using. For the distribution 

of U.S. commercial electricity prices we calculated an average price for 

each utility by dIviding the commercial revenues by its commercial sales 

sales in kWh. These are data that were reported to the EIA which they 

publish. We used 1995 data for investor-owned utilities which represented 

about 80% of the market and 1994 data for publicly-owned utilities this 

was the most recent data available at the time that we did the distribution. 

We are proposing to update to 1996 data which is not the most recent 

available. In both data sets, we then grouped the data into I-cent intervals and 

calculated the fraction in Green Light of ballasts that fell into each ofthese 

intervals or for electricity the fraction of commercial sales that fell into each 

32 

So to examine that possibility, we looked at data from one large voluntary program 

namely the EPA's Green Lights Program. We obtained an extract of that database 

completed through July 30, 1997. There are a variety ofmeasure that these 

implemented but we looked at only those measures that involved installation 

of electronic ballasts in retrofit situations. And that gave us 10 million 

ballasts in 1.5 billion square feet. And this graft shows year by year the number 

of electronic ballasts installed in Green Light projects through 1996 which is the 

last year of complete data that we have. And you will see that there are up 

abound 3.5 millions ballasts per year which is a significant program. That's 

roughly 10% of annual electronic ballasts shipments. We used this data to do both 

electricity price distribution and operating hours distribution, so we would like to compare 

those to the previous distributions that we had used. So for electricity price is not directly 

reported in the Green Lights project report, however they did report the dollars saved by 

the project and the kWh saved by the project. And clearly they had to use electricity 

prices to come up with the donar~ saved. So we assume, and we calculated it 

to come up the electri;ity price. Pilld then we adjusted that to 1995 dollars to 

be comparable with the utility data that we were using. For the distribution 

of U.S. commercial electricity prices we calculated an average price for 

each utility by dIviding the commercial revenues by its commercial sales 

sales in kWh. These are data that were reported to the EIA which they 

publish. We used 1995 data for investor-owned utilities which represented 

about 80% of the market and 1994 data for publicly-owned utilities this 

was the most recent data available at the time that we did the distribution. 

We are proposing to update to 1996 data which is not the most recent 

available. In both data sets, we then grouped the data into I-cent intervals and 

calculated the fraction in Green Light of ballasts that fell into each ofthese 

intervals or for electricity the fraction of commercial sales that fell into each 

32 
of these intervals. So the cost distribution here would be the solid line without the any

tick marks on it is the commercial electricity distribution, the other line with the markers

on it is the Green Lights distribution of electricity. Just to explain what the

distribution means, if you look at the peak of the commercial electricity

distribution that shows that there's nearly 25% of the commercial electricity

prices fell in the 5 to 6 cent interval. And then the bottom grant is the cumulative

fraction, so if you take say 9 cents as an example and follow that up to the

curve, for both commercial electricity and Green Lights about 8-tenths of the

either ballast or the commercial electricity falls below 9 cents per kWh.

And what I would like you to note about this distribution is that there is not

a whole lot of difference between the cumulative fraction of Green Lights

vs ballast vs commercial electricity sales. The fraction of data above or

below any given electricity price is similar for the two data sets. In fact the

averages of the two distributions are also quite similar. For commercial

electricity the average is 7.8 cents per kWh or the Green Light ballast is 7.9

cents per kWh. So based on these distributions we conclude that the

efficient ballasts installed in the Green Light program are not found

disproportionately in regions with high electricity prices.

Mark Perlis:

Would you go back to your first slide. The third bullet, is LBNL in agreement

if there were a disproportionate distribution the end users (not audible)

The key question under lines the (not audible)

The question I want to ask, I don't believe that DoE ever gone on record on this

I'm not sure if (not audible) Does the Department now agree that economy

(not audible)

Diane Fisher:

Well I can't speak for the Department.

33

EE-RM-97-500 COMMENT 21OO

ofthese intervals. So the cost distribution here would be the solid line without the any 

tick marks on it is the commercial electricity distribution, the other line with the markers 

on it is the Green Lights distribution of electricity. Just to explain what the 

distribution means, if you look at the peak of the commercial electricity 

distribution that shows that there's nearly 25% ofthe commercial electricity 

prices fell in the 5 to 6 cent interval. And then the bottom grant is the cumulative 

fraction, so if you take say 9 cents as an example and follow that up to the 

curve, for both commercial electricity and Green Lights about 8-tenths of the 

either ballast or the commercial electricity falls below 9 cents per kWh. 

And what I would like you to note about this distribution is that there is not 

a whole lot of difference between the cumulative fraction of Green Lights 

vs ballast vs commercial electricity sales. The fraction of data above or 

below any given electricity price is similar for the two data sets. In fact the 

averages of the two distributions are also quite similar. For commercial 

electricity the average is 7.8 cents per kWh or the Green Light ballast is 7.9 

cents per kWh. So based on these distributions we conclude that the 

efficient ballasts installed in the Green Light program are not found 

disproportionately in regions with high electricity prices. 

Mark Per1is: 

Would you go back to your first slide. The third bullet, is LBNL in agreement 

if there were a disproportionate distribution the end users (not audible) 

The key question under lines the (not audible) 

The question I want to ask, I don't believe that DoE ever gone on record on this 

I'm not sure if (not audible) Does the Department now agree that economy 

(not audible) 

Diane Fisher: 

Well I can't speak for the Department. 

33 

ofthese intervals. So the cost distribution here would be the solid line without the any 

tick marks on it is the commercial electricity distribution, the other line with the markers 

on it is the Green Lights distribution of electricity. Just to explain what the 

distribution means, if you look at the peak of the commercial electricity 

distribution that shows that there's nearly 25% ofthe commercial electricity 

prices fell in the 5 to 6 cent interval. And then the bottom grant is the cumulative 

fraction, so if you take say 9 cents as an example and follow that up to the 

curve, for both commercial electricity and Green Lights about 8-tenths of the 

either ballast or the commercial electricity falls below 9 cents per kWh. 

And what I would like you to note about this distribution is that there is not 

a whole lot of difference between the cumulative fraction of Green Lights 

vs ballast vs commercial electricity sales. The fraction of data above or 

below any given electricity price is similar for the two data sets. In fact the 

averages of the two distributions are also quite similar. For commercial 

electricity the average is 7.8 cents per kWh or the Green Light ballast is 7.9 

cents per kWh. So based on these distributions we conclude that the 

efficient ballasts installed in the Green Light program are not found 

disproportionately in regions with high electricity prices. 

Mark Per1is: 

Would you go back to your first slide. The third bullet, is LBNL in agreement 

if there were a disproportionate distribution the end users (not audible) 

The key question under lines the (not audible) 

The question I want to ask, I don't believe that DoE ever gone on record on this 

I'm not sure if (not audible) Does the Department now agree that economy 

(not audible) 

Diane Fisher: 

Well I can't speak for the Department. 

33 
Mike McCabe:

We are trying to understand the whole range (not audible) of the regulation

(not audible) looking at the Green Light study (not audible) The comment

that is made to me (not audible)

Mark Perlis:

We will reiterate the point that we made in our written comment. We feel very

strongly about it. The second point, I would make is that what you have studied

in lighting after (not audible) the distribution of the electronic ballast have not been

istributed (not audible) magnetic ballasts (not audible) It is quite possible

that the new purchases of electronic ballasts might be distributed uniformly

with electricity prices, but that the purchases of magnetic ballasts (not audible)

And I would like an acknowledgment from LBNL today of that fact. It is

conceivable that the magnetic ballasts purchasers would be disproportionately

located in low electricity price for low lighting hours of users.

Diane Fisher:

Well the average sets of (not audible) impact of electricity price I would expect

both distributions to be shifted. The purchases of electronic ballast to be shifted

to higher electricity prices and magnetic ballasts purchases to be shifted to lower

electricity prices. And we find for the purchases of electronic ballasts set that is

not the case. They are not shified And purchase total market will be the sum

of those two . So it's a little difficult for me to see how you could have electronic

ballast being evenly distributed and magnetic ballast being all concentrated on

one end of the spectrum.

(Portion not audible. Several people speaking at the same time with

some very low toned. )

34

EE-RM-97-500 COMMENT 21OO

Mike McCabe: 

We are trying to understand the whole range (not audible) of the regulation 

(not audible) looking at the Green Light study (not audible) The comment 

that is made to me (not audible) 

Mark Pedis: 

We will reiterate the point that we made in our written comment. We feel very 

strongly about it. The second point, I would make is that what you have studied 

in lighting after (not audible) the distribution of the electronic ballast have not been 

istributed (not audible) magnetic ballasts (not audible) It is quite possible 

that the new purchases of electronic ballasts might be distributed uniformly 

with electricity prices, but that the purchases of magnetic ballasts (not audible) 

And I would like an acknowledgment from LBNL today of that fact. It is 

conceivable that the magnetic ballasts purchasers would be disproportionately 

located in low electricity price for low lighting hours of users. 

Diane Fisher: 

Well the average sets of (not audible) impact of electricity price I would expect 

- both distributions to be shifted. The purchases of electronic ballast to be shifted 

to higher electricity prices and magnetic ballasts purchases to be shifted to lower 

electricity prices. And we find for the purchases of electronic ballasts set that is 

not the case. They are not shifted And purchase total market will be the sum 

of those two. So it's a little difficult for me to see how you could have electronic 

ballast being evenly distributed and magnetic ballast being all concentrated on 

one end ofthe spectrum. 

(Portion not audible. Several people speaking at the same time with 

some very low toned. ) 

34 

Mike McCabe: 

We are trying to understand the whole range (not audible) of the regulation 

(not audible) looking at the Green Light study (not audible) The comment 

that is made to me (not audible) 

Mark Pedis: 

We will reiterate the point that we made in our written comment. We feel very 

strongly about it. The second point, I would make is that what you have studied 

in lighting after (not audible) the distribution of the electronic ballast have not been 

istributed (not audible) magnetic ballasts (not audible) It is quite possible 

that the new purchases of electronic ballasts might be distributed uniformly 

with electricity prices, but that the purchases of magnetic ballasts (not audible) 

And I would like an acknowledgment from LBNL today of that fact. It is 

conceivable that the magnetic ballasts purchasers would be disproportionately 

located in low electricity price for low lighting hours of users. 

Diane Fisher: 

Well the average sets of (not audible) impact of electricity price I would expect 

- both distributions to be shifted. The purchases of electronic ballast to be shifted 

to higher electricity prices and magnetic ballasts purchases to be shifted to lower 

electricity prices. And we find for the purchases of electronic ballasts set that is 

not the case. They are not shifted And purchase total market will be the sum 

of those two. So it's a little difficult for me to see how you could have electronic 

ballast being evenly distributed and magnetic ballast being all concentrated on 

one end ofthe spectrum. 

(Portion not audible. Several people speaking at the same time with 

some very low toned. ) 

34 
Barbara Atkinson:

The electricity voluntary program and EOA ask the participants to (not audible)

to do retrofits that have a (not audible) Then you expect that people with

lower electricity prices then would not have that rate of return and would not

(not audible)

Mark Perlis:

Well let's go to that point. We don't agree that magnetic ballasts purchasers, that this

epidious from EPA Green Light, even if we accepted it on it's own (not audible) does not

prove the distribution of magnetic ballasts purchases, and that is the key issue of (not

audible) Speaking of the Green Light, first let me just point out, NEMES had it a

different survey approach how the electronic purchasers might be distributed. They went

to actual retrofit programs that were supported in industry publication, and they were

matched up with electricity prices -- they show a high correlation to high electricity prices

and to the (not audible)

(person who spoke here was not audible)

Mark Perlis:

(not audible) we find a lot of these programs are disproportionately located in

high electricity price states. The EPA Green Lights, you are (r_.ot audible)

I don't think it is correct to make the assumption that every participant in Green

Lights, especially those who (not audible), has made a decision ballast by ballast

that even installation by installation, is earning a 20% return, therefore (not

audible) tend to be larger companies that make decisions on a nationwide

bases, and decided to participate even where it's not economic, because they

want to do good (not audible). It is very valuable to the company for what

ever reason to be a participant systems wide, company wide, nation wide in the

Green Lights program. I think the presumption that this particular voluntary

program indicates how purchases who (not audible) in the market on economic

35

EE-RM-97-500 COMMENT 21OO

Barbara Atkinson: 

The electricity voluntary program and EOA ask the participants to (not audible) 

to do retrofits that have a (not audible) Then you expect that people with 

lower electricity prices then would not have that rate of return and would not 

(not audible) 

Mark Pedis: 

Well let's go to that point. We don't agree that magnetic ballasts purchasers, that this 

epidious from EP A Green Light, even if we accepted it on it's own (not audible) does not 

prove the distribution of magnetic ballasts purchases, and that is the key issue of (not 

audible) Speaking of the Green Light, first let me just point out, NEMES had it a 

different survey approach how the electronic purchasers might be distributed. They went 

to actual retrofit programs that were supported in industry publication, and they were 

matched up with electricity prices -- they show a high correlation to high electricity prices 

and to the (not audible) 

(person who spoke here was not audible) 

Mark Perlis: 

(not audible) we find a lot of these programs are disproportionately located in 

high electricity price states. The EPA Green Lights, you are (not audible) 

I don't think it is correct to make the assumption that every participant in Green 

Lights, especially those who (not audible), has made a decision ballast by ballast 

that even installation by installation, is earning a 20% retmn, therefore (not 

audible) tend to be larger companies that make decisions on a nationwide 

bases, and decided to participate even where it's not economic, because they 

want to do good (not audible). It is very valuable to the company for what 

ever reason to be a participant systems wide, company wide, nation wide in the 

Green Lights program. I think the presumption that this particular voluntary 

program indicates how purchases who (not audible) in the market on economic 

35 

Barbara Atkinson: 

The electricity voluntary program and EOA ask the participants to (not audible) 

to do retrofits that have a (not audible) Then you expect that people with 

lower electricity prices then would not have that rate of return and would not 

(not audible) 

Mark Pedis: 

Well let's go to that point. We don't agree that magnetic ballasts purchasers, that this 

epidious from EP A Green Light, even if we accepted it on it's own (not audible) does not 

prove the distribution of magnetic ballasts purchases, and that is the key issue of (not 

audible) Speaking of the Green Light, first let me just point out, NEMES had it a 

different survey approach how the electronic purchasers might be distributed. They went 

to actual retrofit programs that were supported in industry publication, and they were 

matched up with electricity prices -- they show a high correlation to high electricity prices 

and to the (not audible) 

(person who spoke here was not audible) 

Mark Perlis: 

(not audible) we find a lot of these programs are disproportionately located in 

high electricity price states. The EPA Green Lights, you are (not audible) 

I don't think it is correct to make the assumption that every participant in Green 

Lights, especially those who (not audible), has made a decision ballast by ballast 

that even installation by installation, is earning a 20% retmn, therefore (not 

audible) tend to be larger companies that make decisions on a nationwide 

bases, and decided to participate even where it's not economic, because they 

want to do good (not audible). It is very valuable to the company for what 

ever reason to be a participant systems wide, company wide, nation wide in the 

Green Lights program. I think the presumption that this particular voluntary 

program indicates how purchases who (not audible) in the market on economic 

35 
natural grounds. Many of those participants in the Green Lights program do not

make there decisions based on economic justifications. And I'm not sure if

you have any evidence that they do.

Gene Foley:

One of the requirements of EPA (not audible) they do a detailed audit in the

facilities. It is a requirement. You have to count every single lamp, and every

single fixture in every single building and you have to report that. (not audible)

report available, to determine how many installations were over the threshold

vs under the threshold. All of the reports that I have received back indicate

that there not only over the threshold, but they are over threshold by substantial,

substantial amount. So to say that any number of Green Light upgrades are lower

than the required amount, first of all they have to analyze them on an individual

bases not on a nationwide bases. (not audible)

Barbara Atkinson:

(not audible) that their average distribution is 40% of the lighting project.

(Gene Foley and Barbara Atkinson interchange conversation

however it's not audible)

Glen Scltleede:

Are all of the participants in Green Lights program, commercial rather than

industrial?

Diane Fisher:

There are some industrial participants, but for the purposes of this distribution

we compared only the commercial participants to the U.S. commercial

electricity rates.

Glen Scltleede:

So industrial is out of this in terms of (not audible) If you asses the commercial

in all parts of the study then that particular (not audible) wouldn't be there.

36

EE-RM-97-500 COMMENT 21OO

natural grounds. Many ofthose participants in the Green Lights program do not 

make there decisions based on economic justifications. And I'm not sure if 

you have any evidence that they do. 

Gene Foley: 

One of the requirements of EPA (not audible) they do a detailed audit in the 

facilities. It is a requirement. You have to count every single lamp, and every 

single fixture in every single building and you have to report that. (not audible) 

report available, to determine how many installations were over the threshold 

vs under the threshold. All of the reports that I have received back indicate 

that there not only over the threshold, but they are over threshold by substantia~ 

substantial amount. So to say that any number of Green Light upgrades are lower 

than the required amount, first of all they have to analyze them on an individual 

bases not on a nationwide bases. (not audible) 

Barbara Atkinson: 

(not audible) that their average distribution is 40% of the lighting project. 

(Gene Foley and Barbara Atkinson interchange conversation 

however it's not audible) 

Glen Sc1tleede: 

Are all of the participants in Green Lights program, commercial rather than 

industrial? 

Diane Fisher: 

There are some industrial participants, but for the purposes of this distribution 

we compared only the commercial participants to the U.S. commercial 

electricity rates. 

Glen Sc1t1eede: 

So industrial is out of this in terms of (not audible) If you asses the commercial 

in all parts ofthe study then that particular (not audible) wouldn't be there. 

36 

natural grounds. Many ofthose participants in the Green Lights program do not 

make there decisions based on economic justifications. And I'm not sure if 

you have any evidence that they do. 

Gene Foley: 

One of the requirements of EPA (not audible) they do a detailed audit in the 

facilities. It is a requirement. You have to count every single lamp, and every 

single fixture in every single building and you have to report that. (not audible) 

report available, to determine how many installations were over the threshold 

vs under the threshold. All of the reports that I have received back indicate 

that there not only over the threshold, but they are over threshold by substantia~ 

substantial amount. So to say that any number of Green Light upgrades are lower 

than the required amount, first of all they have to analyze them on an individual 

bases not on a nationwide bases. (not audible) 

Barbara Atkinson: 

(not audible) that their average distribution is 40% of the lighting project. 

(Gene Foley and Barbara Atkinson interchange conversation 

however it's not audible) 

Glen Sc1tleede: 

Are all of the participants in Green Lights program, commercial rather than 

industrial? 

Diane Fisher: 

There are some industrial participants, but for the purposes of this distribution 

we compared only the commercial participants to the U.S. commercial 

electricity rates. 

Glen Sc1t1eede: 

So industrial is out of this in terms of (not audible) If you asses the commercial 

in all parts ofthe study then that particular (not audible) wouldn't be there. 

36 
Diane Fisher:

Yes. (not audible) accept commercial for the comparison. We didn't do the

industrial distribution because the numbers are a lot smaller and it's harder to

bet a (not audible) sample.

Bob Wisbey:

I'll try to do this briefly. We find a notion yet that the electronic ballast manufactures or

the electronic ballast purchasers and users areonly distributed through the electricity price

range and the burning hours range to be fundamental preposterous. It just doesn't make

any logical sense. What is shown up here is a chart that was part of the submission that

we did in October, it's not new, and if you very simply look at the top. It has the states 1

isted in descending order of the average commercial electricity price in 1995 and it has the

lighting projects that were done that were recorded in energy user news. The last 1,000

projects that were recorded in there, and we have simply counted the projects by state.

And what we see is the top group, if you look at group total the first one, the top ten

states by electricity price had 27.5% of the population in the U.S. and they had 45.7% of

the retrofit projects. They were disproportionate number of retrofits in the high electricity

price states by almost a factor of 2 to 1. This is a part of the October submission that we

made.

Doug Brookman:

Final comments and questions before we move on to the presentation,

Diane Fisher:

So we did something similar for lighting hours. In this case for both Green

Lights and Xenergy data numbers were plotted separated for 4 ft., 8 ft. and

8 ftHO ballast. That is in keeping with what we did in the report where we

had separate operating hours for each of those types of ballast. And numbers

were calculated separately for the commercial and industrial sector. And then

for each of those data we again grouped data into intervals and calculated these

37

EE-RM-97-500 COMMENT 21OO

Diane Fisher: 

Yes. (not audible) accept commercial for the comparison. We didn't do the 

industrial distribution because the numbers are a lot smaller and it's harder to 

bet a (not audible) sample. 

BobWisbey: 

I'll try to do this briefly. We find a notion yet that the electronic ballast manufactures or 

the eleCtronic ballast purchasers and users areonly distributed through the electricity price 

range and the burning hours range to be fundamental preposterous. It just doesn't make 

any logical sense. What is shown up here is a chart that was part of the submission that 

we did in October, it's not new, and if you very simply look at the top. It has the states 1 

isted in descending order of the average commercial electricity price in 1995 and it has the 

lighting projects that were done that were recorded in energy user news. The last 1,000 

projects that were recorded in there, and we have simply counted the projects by state. 

And what we see is the top group, if you look at group total the first one, the top ten 

states by electricity price had 27.5% of the population in the U.S. and they had 45.7% of 

the retrofit projects. They were disproportionate number of retrofits in the high electricity 

price states by almost a factor of2 to 1. This is a part of the October submission that we 

made. 

Doug Brookman: 

Final comments and questions before we move on to the presentation, 

Diane Fisher: 

So we did something similar for lighting hours. In this case for both Green 

Lights and Xenergy data numbers were plotted separated for 4 ft., 8 ft. and 

8 ftHO ballast. That is in keeping with what we did in the report where we 

had separate operating hours for each of those types of ballast. And numbers 

were calculated separately for the commercial and industrial sector. And then 

for each of those data we again grouped data into intervals and calculated these 

37 

Diane Fisher: 

Yes. (not audible) accept commercial for the comparison. We didn't do the 

industrial distribution because the numbers are a lot smaller and it's harder to 

bet a (not audible) sample. 

BobWisbey: 

I'll try to do this briefly. We find a notion yet that the electronic ballast manufactures or 

the eleCtronic ballast purchasers and users areonly distributed through the electricity price 

range and the burning hours range to be fundamental preposterous. It just doesn't make 

any logical sense. What is shown up here is a chart that was part of the submission that 

we did in October, it's not new, and if you very simply look at the top. It has the states 1 

isted in descending order of the average commercial electricity price in 1995 and it has the 

lighting projects that were done that were recorded in energy user news. The last 1,000 

projects that were recorded in there, and we have simply counted the projects by state. 

And what we see is the top group, if you look at group total the first one, the top ten 

states by electricity price had 27.5% of the population in the U.S. and they had 45.7% of 

the retrofit projects. They were disproportionate number of retrofits in the high electricity 

price states by almost a factor of2 to 1. This is a part of the October submission that we 

made. 

Doug Brookman: 

Final comments and questions before we move on to the presentation, 

Diane Fisher: 

So we did something similar for lighting hours. In this case for both Green 

Lights and Xenergy data numbers were plotted separated for 4 ft., 8 ft. and 

8 ftHO ballast. That is in keeping with what we did in the report where we 

had separate operating hours for each of those types of ballast. And numbers 

were calculated separately for the commercial and industrial sector. And then 

for each of those data we again grouped data into intervals and calculated these 

37 
fraction of ballasts of each data set that fell into each of those interval. And I

will be mostly talking about the results from 4 ft commercial lamp ballast because

some of the other distributions we did have problems with small sample sizes. In

some case you see large peak due that are due to just one Green Lights project.

But all of those distributions are in your handouts. This is the distribution for 4 ft

commercial ballast -- the solid line without tick marks is the Xenergy project data

and the line with the tick marks is the Green Lights program data. Something

that I would like you to notice about this distribution is that there are distinct peaks

at 2000, 3000, 4000, and 5000 hrs/yr. And this is something that we

found in the Green Lights -- I had it on my first slide -- Green Lights data is

self-reported and does have some of the problems inherent with self-reported

data. For one thing, these numbers indicate to us that a lot of the numbers that

were being reported for lighting hours were approximate. And I would also like

for you to notice that there is a large peak in the GL at 8750 hr/yr, which is

continuous operation that is lacking in the Xenergy data set. I should also mention

this Xenergy data. was based on very detailed audits, on-site audits with auditors

who were trying to rectify the audit results with Xenergy balances with the utility

bills. Was not required of the GL participants. We are not quite sure why there is

that 8760 GL and not with Xenergy. One possibility is that GL project did in

fact target fixtures that were operating continuously. In any case we do see a

difference here between the GL distribution and the Xenergy distribution. The

GL you see particularly in the cumulative that in fact the GL distribution is some

what shifted to the right toward high operating hours. That should result in the

GL average annual operating hours being 4300 hr/yr, where as with the Xenergy

data it's 3600 hr/yr. A large part of that shifted due to that peak at 8750, if you

take that out the average for GL is 3900 hr/yr which is closer to the 3600 hr/yr.

38

EE-RM-97-500 COMMENT 21OO

fraction of ballasts of each data set that fell into each of those interval. And I 

will be mostly talking about the results from 4 ft commercial lamp ballast because 

some of the other distributions we did have problems with small sample sizes. In 

some case you see large peak due that are due to just one Green Lights project. 

But all of those distributions are in your handouts. This is the distribution for 4 ft 

commercial ballast -- the solid line without tick marks is the Xenergy project data 

and the line with the tick marks is the Green Lights program data Something 

that I would like you to notice about this distribution is that there are distinct peaks 

at 2000,3000,4000, and 5000 hrs/yr. And this is something that we 

found in the Green Lights -- I had it on my first slide -- Green Lights data is 

self-reported and does have some ofthe problems inherent with self-reported 

data. For one thing, these numbers indicate to us that a lot of the numbers that 

were being reported for lighting hours were approximate. And I would also like 

for you to notice that there is a large peak in the GL at 8750 hr/yr, which is 

continuous operatIon that is lacking in the Xenergy data set. I should also mention 

this Xenergy data was based on very detailed audits, on-site audits with auditors 

who were trying to rectuy the audit results with Xenergy balances with the utility 

bills. Was not required of the GL participants. We are not quite sure why there is 

that 8760 GL and not with Xenergy. One possibility is that GL project did in 

fact target fixtures that were operating continuously. In any case we do see a 

difference here between the GL distribution and the Xenergy distribution. The 

GL you see panicularly in the cumulative that in fact the GL distribution is some 

what shifted to the right toward high operating hours. That should result in the 

GL average annual operating hours being 4300 hr/yr, where as with the Xenergy 

data it's 3600 hr/yr. A large part ofthat shifted due to that peak at 8750, if you 

take that out the average for GL is 3900 hr/yr which is closer to the 3600 hr/yr. 

38 

fraction of ballasts of each data set that fell into each of those interval. And I 

will be mostly talking about the results from 4 ft commercial lamp ballast because 

some of the other distributions we did have problems with small sample sizes. In 

some case you see large peak due that are due to just one Green Lights project. 

But all of those distributions are in your handouts. This is the distribution for 4 ft 

commercial ballast -- the solid line without tick marks is the Xenergy project data 

and the line with the tick marks is the Green Lights program data Something 

that I would like you to notice about this distribution is that there are distinct peaks 

at 2000,3000,4000, and 5000 hrs/yr. And this is something that we 

found in the Green Lights -- I had it on my first slide -- Green Lights data is 

self-reported and does have some ofthe problems inherent with self-reported 

data. For one thing, these numbers indicate to us that a lot of the numbers that 

were being reported for lighting hours were approximate. And I would also like 

for you to notice that there is a large peak in the GL at 8750 hr/yr, which is 

continuous operatIon that is lacking in the Xenergy data set. I should also mention 

this Xenergy data was based on very detailed audits, on-site audits with auditors 

who were trying to rectuy the audit results with Xenergy balances with the utility 

bills. Was not required of the GL participants. We are not quite sure why there is 

that 8760 GL and not with Xenergy. One possibility is that GL project did in 

fact target fixtures that were operating continuously. In any case we do see a 

difference here between the GL distribution and the Xenergy distribution. The 

GL you see panicularly in the cumulative that in fact the GL distribution is some 

what shifted to the right toward high operating hours. That should result in the 

GL average annual operating hours being 4300 hr/yr, where as with the Xenergy 

data it's 3600 hr/yr. A large part ofthat shifted due to that peak at 8750, if you 

take that out the average for GL is 3900 hr/yr which is closer to the 3600 hr/yr. 

38 
Given the large uncertainties inherent in self-reported GL data, it is difficult to

determine if the difference is significant.

Mark Perlis:

Well my first comment is that here you see a significant (not audible)

Isaac Turiel:

We've had some discussions about the distributions and what was found with DoE

and it's very difficult to tell on both counts -- it could be price and operating hours

they are both self-reported numbers. And numbers that are put into electricity

price we don't know how carefully they obtained those numbers. How did they

get them? Did they look at there last bill? Did they look at the kWh charged or

did they actually try to figure out the average? We don't know how they got that.

So it's true for both electricity and operating hours. This was a large data base

that had a lot of information. It would be reasonable to try to investigate that and

see if we can answer the question that was proposed, the populations their .

differences And even now there are still uncertainties to a degree. We don't

know for sure. On the other hand, you presented so data too, it's a smaller

sample. That was self-reported too by people putting in data. But I think what

I am saying it is very difficult to know the interest. I don't think that anybody in

this room knows what the interest in terms of having real data, we can have

guess and opinions. But we don't know for the actual population of people who

have (not audible) We do not know the -- you have to go right to those people.

Mark Perlis:

(not audible) The reason has become important is because in the past DoE and

LBNL have done all of their LCC analysis by using (not audible) on an average

customer, the average consumer base. We have challenged you, I think perhaps

for the first time, and I don't know whether other industries have challenged DoE

on this or not, or if it is relevant for the residential customer. We don't have a

39

EE-RM-97-500 COMMENT 21OO

Given the large uncertainties inherent in self-reported GL data, it is difficult to 

determine if the difference is significant. 

Mark Perlis: 

Well my first comment is that here you see a significant (not audible) 

Isaac Turie!: 

We've had some discussions about the distributions and what was found with DoE 

and it's very difficult to tell on both counts -- it could be price and operating hours 

they are both self-reported numbers. And numbers that are put into electricity 

price we don't know how carefully they obtained those numbers. How did they 

get them? Did they look at there last bill? Did they look at the kWh charged or 

did they actually try to figure out the average? We don't know how they got that. 

So it's true for both electricity and operating hours. This was a large data base 

that had a lot of information. It would be reasonable to try to investigate that and 

see if we can answer the question that was proposed, the populations their . 

differences And even now there are still uncertainties to a degree. We don't 

know for sure. On the other hand, you presented so data too, it's a smaller 

sample. That was self-reported too by people putting in data. But I think what 

I am saying it is very difficult to know the interest. I don't think that anybody in 

this room knows what the interest in terms of having real data, we can have 

guess and opinions. But we don't know for the actual population of people who 

have (not audible) We do not know the -- you have to go right to those people. 

Mark PerIis: 

(not audible) The reason has become important is because in the past DoE and 

LBNL have done all of their Lee analysis by using (not audible) on an average 

customer, the average consumer base. We have challenged you, I think perhaps 

for the first time, and I don't know whether other industries have challenged DoE 

on this or not, or ifit is relevant for the residential customer. We don't have a 

39 

Given the large uncertainties inherent in self-reported GL data, it is difficult to 

determine if the difference is significant. 

Mark Perlis: 

Well my first comment is that here you see a significant (not audible) 

Isaac Turie!: 

We've had some discussions about the distributions and what was found with DoE 

and it's very difficult to tell on both counts -- it could be price and operating hours 

they are both self-reported numbers. And numbers that are put into electricity 

price we don't know how carefully they obtained those numbers. How did they 

get them? Did they look at there last bill? Did they look at the kWh charged or 

did they actually try to figure out the average? We don't know how they got that. 

So it's true for both electricity and operating hours. This was a large data base 

that had a lot of information. It would be reasonable to try to investigate that and 

see if we can answer the question that was proposed, the populations their . 

differences And even now there are still uncertainties to a degree. We don't 

know for sure. On the other hand, you presented so data too, it's a smaller 

sample. That was self-reported too by people putting in data. But I think what 

I am saying it is very difficult to know the interest. I don't think that anybody in 

this room knows what the interest in terms of having real data, we can have 

guess and opinions. But we don't know for the actual population of people who 

have (not audible) We do not know the -- you have to go right to those people. 

Mark PerIis: 

(not audible) The reason has become important is because in the past DoE and 

LBNL have done all of their Lee analysis by using (not audible) on an average 

customer, the average consumer base. We have challenged you, I think perhaps 

for the first time, and I don't know whether other industries have challenged DoE 

on this or not, or ifit is relevant for the residential customer. We don't have a 

39 
residential product. We have commercial and industrial products. And for

those customers we believe, we have come to believe, not that all of the purchases

of the energy efficient or the non-energy efficient products are commonly distributed

among the population. (not audible)

(non-audible -- several people having independent conversations)

Bob Wisbey:

This again is a slide from the submittal we made in October. This is a breakeven

curve and I don't expect everybody to figure this out. On the left hand axis is

the burring hours or the horizontal axis is electricity price, the black curve there is

the breakeven curve. And anybody who has an installation that had the electricity

price and burning hours above and to the right of that curve would be, so call

(not audible) required a rot more efficient ballast. And going to the left and below

would be a sa caul ooEr. The analysis of this particular curve with this

particular set of variables shows (not audible) detail submittal, shows 38%

of installations would be losers in that they were require to install a more

efficient ballast. The other percentage would be winners. One of the reasons

why we want this the comment with the 20% difference in burning hour between

the surveys. There was a 3600 hour and 4300 hour numbers in the survey

which was shown. By coincidence the (not audible) is the same breakeven

curve but with the axis shifted by 20% . In this curve, as you can see now,

much larger percentage of the users are below and to the left of the line.

In fact, in this particular one 70% would be losers, if the variable of the

average points were shifted by 20%. But it is in the October submission

that we made and explaining the extensive detail how it was done.

Doug Brookman:

Thank you. Bob. Are you done with your presentation?

Diane Fisher:

40

EE-RM-97-500 COMMENT 21OO

residential product. We have commercial and industrial products. And for 

those customers we believe, we have come to believe, not that all of the purchases 

of the energy efficient or the non-energy efficient products are commonly distributed 

among the population. (not audible) 

(non-audible -- several people having independent conversations) 

Bob Wisbey: 

This again 1S a slide from the submittal we made in October. This is a breakeven 

curve and I don't expect everybody to figure this out. On the left hand axis is 

the burning hourr. Ofl the horizontal axis is electricity price, the black curve there is 

the breakeven cmve. And anybody who has an installation that had the electricity 

price and burning hours above and to the right of that curve would be, so call 

(not audible) required a iot more efficient ballast. And going to the left and below 

would be a S0 caH 1003t;r. The analysis of this particular curve with this 

particular set of variables shows (not audible) detail submittal, shows 38% 

of installations would be losers L.'l that they were require to install a more 

efficient ballast. The other percentage would be winners. One of the reasons 

why we want this the comment with the 20% difference in burning hour between 

the surveys. There was a 3600 hour and 4300 hour numbers in the survey 

which was shown. By coincidence the (not audible) is the same breakeven 

curve but with the axis shifted by 20%. In this curve, as you can see now, 

much larger percentage of the users are below and to the left of the line. 

In fact, in this particular one 70% would be losers, if the variable of the 

average points were shifted by 20%. But it is in the October submission 

that we made and explaining the extensive detail how it was done. 

Doug Brookman: 

Thank you. Bob. Are you done with your presentation? 

Diane Fisher: 

40 

residential product. We have commercial and industrial products. And for 

those customers we believe, we have come to believe, not that all of the purchases 

of the energy efficient or the non-energy efficient products are commonly distributed 

among the population. (not audible) 

(non-audible -- several people having independent conversations) 

Bob Wisbey: 

This again 1S a slide from the submittal we made in October. This is a breakeven 

curve and I don't expect everybody to figure this out. On the left hand axis is 

the burning hourr. Ofl the horizontal axis is electricity price, the black curve there is 

the breakeven cmve. And anybody who has an installation that had the electricity 

price and burning hours above and to the right of that curve would be, so call 

(not audible) required a iot more efficient ballast. And going to the left and below 

would be a S0 caH 1003t;r. The analysis of this particular curve with this 

particular set of variables shows (not audible) detail submittal, shows 38% 

of installations would be losers L.'l that they were require to install a more 

efficient ballast. The other percentage would be winners. One of the reasons 

why we want this the comment with the 20% difference in burning hour between 

the surveys. There was a 3600 hour and 4300 hour numbers in the survey 

which was shown. By coincidence the (not audible) is the same breakeven 

curve but with the axis shifted by 20%. In this curve, as you can see now, 

much larger percentage of the users are below and to the left of the line. 

In fact, in this particular one 70% would be losers, if the variable of the 

average points were shifted by 20%. But it is in the October submission 

that we made and explaining the extensive detail how it was done. 

Doug Brookman: 

Thank you. Bob. Are you done with your presentation? 

Diane Fisher: 

40 
I'm done, unless anyone has questions for me.

Doug Brookman:

I think before long we should entertain a break. Additional comments, questions

on the presentation or on the other comments that have been made before we

move on.

BREAK 11:15 A.M.

Doug Brookman:

I am going to make sure that we stop for lunch about 12:30 or in that range.

Isaac Turiel:

Okay were are going to turn from LCC analysis to the National Energy Impacts.

And to start with we are going to talk about shipments, a key input to any National

Energy Savings and then we will go on to discuss spreadsheet after that.

We will demonstrate the spreadsheet which calculates National Energy Savings.

Under shipments, I going to talk about historical data and a little bit about utility

DSM programs (shipment forecast). The historical data is data supplied to us

by NEMA and it's on shipments of ballast from 1993 to 1997. Disaggregated by

magnetic, electronic and cathode cutout ballasts and it's for several different lamp

ballast systems. So we looked at both what peycent of the total were magnetic

in different product classes and also the upward magnitude of shipments of the

magnetic ballast. Without the help of (not audible) we could not have presented

this data. Thank you. What is shown here is from 1993 to 1997 for three different

types of ballast -- All 4ftT12's, 8ftT12's and 8ftT12HO -- This aggregation does

three types. And what we see is looking at the top two [4ftT12 and 8ftT12] there

is not very much change that occurs -- pretty level. The 8ftT12/HO is basically on

the order 50%. So about half of those ballast are magnetic and half of them

electronic. Now I will look at the absolute magnitude and see what's happening.

Right now we are looking at 2F40T12 Ballasts, these are magnetic keep in mind.

41

EE-RM-97-500 COMMENT 21OO

I'm done, unless anyone has questions for me. 

Doug Brookman: 

I think before long we should entertain a break. Additional comments, questions 

on the presentation or on the other comments that have been made before we 

move on. 

BREAK 11:15 A.M. 

Doug Brookman: 

I am going to make sure that we stop for lunch about 12:30 or in that range. 

Isaac Turiel: 

Okay were are going to turn from LCC analysis to the National Energy Impacts. 

And to start with we are going to talk about shipments, a key input to any National 

Energy Savings and then we will go on to discuss spreadsheet after that. 

We will demonstrate the spreadsheet which calculates National Energy Savings. 

Under shipments, I going to talk about historical data and a little bit about utility 

DSM programs (shipment forecast). The historical data is data supplied to us 

by NEMA and it's on shipments of ballast from 1993 to 1997. Disaggregated by 

magnetic, electronic and cathode cutout ballasts and it's for several different lamp 

ballast systems. So we looked at both what percent of the total were magnetic 

in different product classes and also the upward magnitude of shipments of the 

magnetic ballast. Without the help of (not audiNe) we could not have presented 

this data. Thank you. What is shown here is from 1993 to 1997 for three different 

types of ballast -- A114ftTI2's, SftT12's and SftT12HO -- This aggregation does 

three types. And what we see is looking at the top two [4ftT12 and SftTI2] there 

is not very much change that occurs -- pretty level. The SftT12IHO is basically on 

the order 50%. So about half of those ballast are magnetic and half of them 

electronic. Now I will look at the absolute magnitude and see what's happening. 

Right now we are looking at 2F40T12 Ballasts, these are magnetic keep in mind. 

41 

I'm done, unless anyone has questions for me. 

Doug Brookman: 

I think before long we should entertain a break. Additional comments, questions 

on the presentation or on the other comments that have been made before we 

move on. 

BREAK 11:15 A.M. 

Doug Brookman: 

I am going to make sure that we stop for lunch about 12:30 or in that range. 

Isaac Turiel: 

Okay were are going to turn from LCC analysis to the National Energy Impacts. 

And to start with we are going to talk about shipments, a key input to any National 

Energy Savings and then we will go on to discuss spreadsheet after that. 

We will demonstrate the spreadsheet which calculates National Energy Savings. 

Under shipments, I going to talk about historical data and a little bit about utility 

DSM programs (shipment forecast). The historical data is data supplied to us 

by NEMA and it's on shipments of ballast from 1993 to 1997. Disaggregated by 

magnetic, electronic and cathode cutout ballasts and it's for several different lamp 

ballast systems. So we looked at both what percent of the total were magnetic 

in different product classes and also the upward magnitude of shipments of the 

magnetic ballast. Without the help of (not audiNe) we could not have presented 

this data. Thank you. What is shown here is from 1993 to 1997 for three different 

types of ballast -- A114ftTI2's, SftT12's and SftT12HO -- This aggregation does 

three types. And what we see is looking at the top two [4ftT12 and SftTI2] there 

is not very much change that occurs -- pretty level. The SftT12IHO is basically on 

the order 50%. So about half of those ballast are magnetic and half of them 

electronic. Now I will look at the absolute magnitude and see what's happening. 

Right now we are looking at 2F40T12 Ballasts, these are magnetic keep in mind. 

41 
Again we are looking a data we got on shipments from NEMA. And we have

five data points only, 1993 to 1997 not very much to forecast what is going to

happen down to the future. And the last point 1997 is for a half a year. And in

consultation with members of NEMA we (not audible) for the first six months

so we could get a full year of testing Now what we have, those values are up on

the order for this particular ballast, starts around 7M and comes down to about 6M

and show for 1997 roughly a number to the year before. (not audible)

Somewhere about 2001 2015, 2016, or 2017 there would be no more magnetic

ballasts. That's one trend line. On the other hand (not audible)

That was for the 8 foot magnetic ballasts. This one is for the 4 ft magnetic ballast.

Again it is kind of very similar. It comes down from something like 28M or so

down to about 23M the seems to just sit in that one data point, not change very

much from one year to the next. And the trend line shows that around 2015, 2016

it will go to zero for magnetic ballast. So we showed examples of historical

information. Those two ballast where the most of the potential energy savings would

be, that's why we put them up there. With the 8 ft and the 4 ft 2-lamp

ballasts is where most of the savings potential lie in (not audible) to electronics.

And there is another non-regulatory program that may impact shipments in the

future. And we talked about GL already on this list. Utility DSM I want to say

a little about very shortly. And NEMA has a program which they may want to

say something about if they like. ASHRAE/IES 90.1 which effects new building

construction in the future. And there's FEMP also -- Federal programs. These

are all programs that effect, trying to get electronic ballasts in the market.

I'd like to turn to the Utility DSM Program. Before showing that we

analyzed some data we got from utility companies but after looking through it

I wanted to put this in front before sharing the results because one of the things

42

EE-RM-97-500 COMMENT 21OO

Again we are looking a data we got on shipments from NEMA. And we have 

five data points only, 1993 to 1997 not very much to forecast what is going to 

happen down to the future. And the last point 1997 is for a half a year. And in 

consultation with members ofNEMA we (not audible) for the first six months 

so we could get a full year of testing Now what we have, those values are up on 

the order for this particular ballast, starts around 7M and comes down to about 6M 

and show for 1997 roughly a number to the year before. (not audible) 

Somewhere about 2001 2015,2016, or 2017 there would be no more magnetic 

ballasts. That's one trend line. On the other hand (not audible) 

That was for the 8 foot magnetic ballasts. This one is for the 4 :ft magnetic ballast. 

Again it is kind of very similar. It comes down from something like 28M or so 

down to about 23M the seems to just sit in that one data point, not change very 

much from one year to the next. And the trend line shows that around 2015, 2016 

it will go to zero for magnetic ballast. So we showed examples of historical 

information. Those two ballast where the most of the potential energy savings would 

be, that's why we put them up there. With the 8 ft and the 4 ft 2-lamp 

ballasts is where most of the savings potential lie in (not audible) to electronics. 

And there is another non-regulatory program that may impact shipments in the 

future. And we talked about GL already on this list. Utility DSM I want to say 

a little about very shortly. And NEMA has a program which they may want to 

say something about if they like. ASHRAEIIES 90.1 which effects new building 

construction in the future. And there's FEMP also -- Federal programs. These 

are all programs that effect, trying to get electronic ballasts in the market. 

I'd like to turn to the Utility DSM Program. Before showing that we 

analyzed some data we got from utility companies but after looking through it 

I wanted to put this in front before sharing the results because one of the things 

42 

Again we are looking a data we got on shipments from NEMA. And we have 

five data points only, 1993 to 1997 not very much to forecast what is going to 

happen down to the future. And the last point 1997 is for a half a year. And in 

consultation with members ofNEMA we (not audible) for the first six months 

so we could get a full year of testing Now what we have, those values are up on 

the order for this particular ballast, starts around 7M and comes down to about 6M 

and show for 1997 roughly a number to the year before. (not audible) 

Somewhere about 2001 2015,2016, or 2017 there would be no more magnetic 

ballasts. That's one trend line. On the other hand (not audible) 

That was for the 8 foot magnetic ballasts. This one is for the 4 :ft magnetic ballast. 

Again it is kind of very similar. It comes down from something like 28M or so 

down to about 23M the seems to just sit in that one data point, not change very 

much from one year to the next. And the trend line shows that around 2015, 2016 

it will go to zero for magnetic ballast. So we showed examples of historical 

information. Those two ballast where the most of the potential energy savings would 

be, that's why we put them up there. With the 8 ft and the 4 ft 2-lamp 

ballasts is where most of the savings potential lie in (not audible) to electronics. 

And there is another non-regulatory program that may impact shipments in the 

future. And we talked about GL already on this list. Utility DSM I want to say 

a little about very shortly. And NEMA has a program which they may want to 

say something about if they like. ASHRAEIIES 90.1 which effects new building 

construction in the future. And there's FEMP also -- Federal programs. These 

are all programs that effect, trying to get electronic ballasts in the market. 

I'd like to turn to the Utility DSM Program. Before showing that we 

analyzed some data we got from utility companies but after looking through it 

I wanted to put this in front before sharing the results because one of the things 

42 
we find is the rebates mostly for T8 lamp/ballasts that are occurring in this program when

you look at it in detail -- not for T12 . There's no focus on T12 lamp/ballast as far as I

could tell. There are very few rebates that occurred. And that mostly replacement

market. The DSM appear to be mostly retrofit, large scale market. It is not clear, I will

say right up front, whether this analysis of DSM programs will tell us a lot about the

future T 12 lamp/ballast shipment forecasts. And the shift base particularly for replacement

markets. This slide here tells us something about the methodology. I will say basically we

contacted about 30 different utilities -- 15 of those (not audible) DSM program

in the country out of those 30. We only got data from 9, it's very difficult to get

this kind of data. Very few people were available to provide this kind of information

and they don't have it in any reports. They have to go look it up in a data base and give it

to you. The kind of data we got was how much they were spending on energy efficiency

programs and what percent of that was devoted to electronic ballast. In the example I am

going to show here, just to show how we did it, for the year 1994 the samples that we

looked at 13% of the energy efficiency spending was from electronic ballast and the

average rebate per ballast in that same year was $10 .70. Now to try to get a national

estimate you have to make a big leap . For your sample applies to the nation as a whole.

That's the only way to get some kind of, at least one way to get a national estimate of

how many ballasts were rebated. We made that assumption that the percentage and

dollars per ballasts as a sample was the same for the nation. And we knew what the

total spending is for the nation, we have this data $1.6 Billion for example in 1994 energy

efficiency. And we take 13% devoted to electronic ballasts we get $207 Million devoted

to electronic ballasts nationally. Following that same example , you divide that number

$207 Million by the average rebate per ballast of $10.70, you get a result of about 19.4

Million electronic ballast rebate . There is a report on the table that has all these details

about this analysis. The next graft which shows what the results. On the very top are the

total number of electronic ballasts shipped in each of those years 1993 to 1997.

43

EE-RM-97-500 COMMENT 21OO

we find is the rebates mostly for TS lamplballasts that are occurring in this program when 

you look at it in detail-- not for T12. There's no focus on T12lamplballast as far as I 

could tell. There are very few rebates that occurred. And that mostly replacement 

market. The DSM appear to be mostly retrofit, large scale market. It is not clear, I will 

say right up front, whether this analysis ofDSM programs will tell us a lot about the 

future T12lamplballast shipment forecasts. And the shift base particularly for replacement 

markets. This slide here tells us something about the methodology. I will say basically we 

contacted about 30 different utilities -- 15 ofthose (not audible) DSM program 

in the country out of those 30. We only got data from 9, it's very difficult to get 

this kind of data. Very few people were available to provide this kind of information 

and they don't have it in any reports. They have to go look it up in a data base and give it 

to you. The kind of data we got was how much they were spending on energy efficiency 

programs and what percent of that was devoted to electronic ballast. In the example I am 

going to show here, just to show how we did it, for the year 1994 the samples that we 

looked at 13% of the energy efficiency spending was from electronic ballast and the 

average rebate per ballast in that same year was $10.70. Now to try to get a national 

estimate you have to make a big leap. For your sample applies to the nation as a whole. 

That's the only way to get some kind of, at least one way to get a national estimate of 

how many ballasts were rebated. We made that assumption that the percentage and 

dollars per ballasts as a sample was the same for the nation. And we knew what the 

total spending is for the nation, we have this data $1.6 Billion for example in 1994 energy 

efficiency. And we take 13% devoted to electronic ballasts we get $207 Million devoted 

to electronic ballasts nationally. Following that same example, you divide that number 

$207 Million by the average rebate per ballast of $1 0.70, you get a result of about 19.4 

Million electronic ballast rebate. There is a report on the table that has all these details 

about this analysis. The next graft which shows what the results. On the very top are the 

total number of electronic ballasts shipped in each of those years 1993 to 1997. 

43 

we find is the rebates mostly for TS lamplballasts that are occurring in this program when 

you look at it in detail-- not for T12. There's no focus on T12lamplballast as far as I 

could tell. There are very few rebates that occurred. And that mostly replacement 

market. The DSM appear to be mostly retrofit, large scale market. It is not clear, I will 

say right up front, whether this analysis ofDSM programs will tell us a lot about the 

future T12lamplballast shipment forecasts. And the shift base particularly for replacement 

markets. This slide here tells us something about the methodology. I will say basically we 

contacted about 30 different utilities -- 15 ofthose (not audible) DSM program 

in the country out of those 30. We only got data from 9, it's very difficult to get 

this kind of data. Very few people were available to provide this kind of information 

and they don't have it in any reports. They have to go look it up in a data base and give it 

to you. The kind of data we got was how much they were spending on energy efficiency 

programs and what percent of that was devoted to electronic ballast. In the example I am 

going to show here, just to show how we did it, for the year 1994 the samples that we 

looked at 13% of the energy efficiency spending was from electronic ballast and the 

average rebate per ballast in that same year was $10.70. Now to try to get a national 

estimate you have to make a big leap. For your sample applies to the nation as a whole. 

That's the only way to get some kind of, at least one way to get a national estimate of 

how many ballasts were rebated. We made that assumption that the percentage and 

dollars per ballasts as a sample was the same for the nation. And we knew what the 

total spending is for the nation, we have this data $1.6 Billion for example in 1994 energy 

efficiency. And we take 13% devoted to electronic ballasts we get $207 Million devoted 

to electronic ballasts nationally. Following that same example, you divide that number 

$207 Million by the average rebate per ballast of $1 0.70, you get a result of about 19.4 

Million electronic ballast rebate. There is a report on the table that has all these details 

about this analysis. The next graft which shows what the results. On the very top are the 

total number of electronic ballasts shipped in each of those years 1993 to 1997. 

43 
Again that's NEMA data. Starting around 23M and going up to 35M almost

in 1997. Again based on six months for 1997. We have two different estimates

in 1993 of what percent of the ballast were subsidized through electric utility

rebates. So the reason for the two numbers is we had two different samples --

we had 6 utilities that provided all of the information we asked for. We had

a larger sample of 9 utilities that provided some of those details, but some were

left out and we had to do a little more extrapolating. We did it two different ways.

The lower one alludes to 9 utilities samples, and upper to the 6 utilities samples.

So for the first year it say that depending which sample you used from 41 to 47%

of the ballast were subsidized. Going on further that number goes up, but you

have twe very difr'erert estimates from roughly 50 to 3/4 being subsidized. The

following year is about 50%, it doesn't matter which sample . Then it comes down

a lot (not audible) 1995 to 1996 there is this big fall off, and then we only have data

from one of those sample, the 6 utilities, falls off even more. We learn, there is

less money going into ballast rebates. How that is going to effect the (not audible)

(Presenter had difficulty with microphone -- not functioning)

Isaac Turiei:

I just want to show one more worksheet before, the description, how it operates and you'll

have to look at this at your leisure when you get it back to your offices just the same.

This is the information on where the energy savings are confirmed when you changed from

a, lets look at the very top one. One at F40T12 energy saver lamp. You have the baseline

information. The normalized fixture watts, the price, kilowatt hours per year you use and

then shows incremental costs going from baseline (not audible) cutout or baseline to home

electronic. That would be like $10.80 in this example here. Baseline to electronic. And

then kilowatt hour savings would show 36 kilowatt hours for that change from baseline to

electronic. This information is provided for 1F40, 2F40, 2F96, 2F96H0. Those four

categories. The second category the weighted average, the 2F40T 12 and the weighted

44

EE-RM-97-500 COMMENT 21OO

Again that's NEMA data. Starting around 23M and going up to 35M almost 

in 1997. Again based on six months for 1997. We have two different estimates 

in 1993 of what percent of the ballast were subsidized through electric utility 

rebates. So the reason for the two numbers is we had two different samples --

we had 6 utilities that provided all ofthe information we asked for. We had 

a larger sample of 9 utilities that provided some of those details, but some were 

left out and we had to do a little more extrapolating. We did it two different ways. 

The lower one alludes to 9 utilities samples, and upper to the 6 utilities samples. 

So for the first year it say that depending which sample you used from 41 to 47% 

of the ballast were subsidized. Going on further that number goes up, but you 

have hvo very different estimates from mughly 50 to 3/4 being subsidized. The 

following year is about 50%, it doesn't matter which sample. Then it comes down 

a lot (not audible) 1995 to 1996 there is this big fall off, and then we only have data 

from one ofthose sample, the 6 utilities, falls off even more. We learn, there is 

less money going into ballast rebates. How that is going to effect the (not audible) 

(Presenter had difficulty with microphone -- not functioning) 

Isaac Turiel: 

1 just want to show one more worksheet before, the description, how it operates and you'll 

have to look at this at your leisure when you get it back to your offices just the same. 

This is the information on where the energy savings are confirmed when you changed from 

a, lets look at the very top one. One at F40T12 energy saver lamp. You have the baseline 

information. The normalized fixture watts, the price, kilowatt hours per year you use and 

then shows incremental costs going from baseline (not audible) cutout or baseline to home 

electronic. That would be like $10.80 in this example here. Baseline to electronic. And 

then kilowatt hour savings would show 36 kilowatt hours for that change from baseline to 

electronic. This information is provided for IF40, 2F40, 2F96, 2F96HO. Those four 

categories. The second category the weighted average, the 2F40T12 and the weighted 

44 

Again that's NEMA data. Starting around 23M and going up to 35M almost 

in 1997. Again based on six months for 1997. We have two different estimates 

in 1993 of what percent of the ballast were subsidized through electric utility 

rebates. So the reason for the two numbers is we had two different samples --

we had 6 utilities that provided all ofthe information we asked for. We had 

a larger sample of 9 utilities that provided some of those details, but some were 

left out and we had to do a little more extrapolating. We did it two different ways. 

The lower one alludes to 9 utilities samples, and upper to the 6 utilities samples. 

So for the first year it say that depending which sample you used from 41 to 47% 

of the ballast were subsidized. Going on further that number goes up, but you 

have hvo very different estimates from mughly 50 to 3/4 being subsidized. The 

following year is about 50%, it doesn't matter which sample. Then it comes down 

a lot (not audible) 1995 to 1996 there is this big fall off, and then we only have data 

from one ofthose sample, the 6 utilities, falls off even more. We learn, there is 

less money going into ballast rebates. How that is going to effect the (not audible) 

(Presenter had difficulty with microphone -- not functioning) 

Isaac Turiel: 

1 just want to show one more worksheet before, the description, how it operates and you'll 

have to look at this at your leisure when you get it back to your offices just the same. 

This is the information on where the energy savings are confirmed when you changed from 

a, lets look at the very top one. One at F40T12 energy saver lamp. You have the baseline 

information. The normalized fixture watts, the price, kilowatt hours per year you use and 

then shows incremental costs going from baseline (not audible) cutout or baseline to home 

electronic. That would be like $10.80 in this example here. Baseline to electronic. And 

then kilowatt hour savings would show 36 kilowatt hours for that change from baseline to 

electronic. This information is provided for IF40, 2F40, 2F96, 2F96HO. Those four 

categories. The second category the weighted average, the 2F40T12 and the weighted 

44 
average comes from the ones below. There is four different, what it is those 2F40T12

ballast's are occurring in different kind of fixtures so you've get different energy savings

and also different price differentials depending on what fixture depending on whether it is

was a falling out fixture, two or three. That is what we tried to do here. We have market

shares on the right hand side from 38 down to 7 and 53 depending on what fixture type.

And then we are doing weighted averages of what is being saved with each of those

fixtures because all of that is put back into the top part to tell you what are the savings

you get for a two lamp magnetic ballast in exchange for electronics. It is weighted among

those four different fixture types. It is shown where Barbara is pointing to in those boxes

there. For example the weighted average on energy savings vary from baseline to

electronic is 37 kilowatt-hours per year when you weight all of those together. So I'm

sure there will be many questions when you all have a chance to look at it and I will be

happy to try and answer those in detail.

Barbara Atkinson:

Am I correct that if you wanted to add a savings for electronic to T8 you could do it here.

Isaac Turiel:

Oh sure, yes. It definitely could be done.

Brookman:

If there is any comment from the back please use the microphone.

Tom Hagen, T & J Enterprises:

In the format fixtures you are using two electronic reference targets?

Isaac Turiel:

Yes. No, one electronic and two magnetic.

Hagen:

Did I miss something down there on the format (not audible)?

Isaac Turiel:

No. One is electronic register. At the level two you see on the left maybe you see.

45

EE-RM-97-500 COMMENT 21OO

average comes from the ones below. There is four different, what it is those 2F40T12 

ballast's are occurring in different kind of fixtures so you've get different energy savings 

and also different price differentials depending on what fixture depending on whether it is 

was a falling out fixture, two or three. That is what we tried to do here. We have market 

shares on the right hand side from 38 down to 7 and 53 depending on what fixture type. 

And then we are doing weighted averages of what is being saved with each of those 

fixtures because all of that is put back into the top part to tell you what are the savings 

you get for a two lamp magnetic ballast in exchange for electronics. It is weighted among 

those four different fixture types. It is shown where Barbara is pointing to in those boxes 

there. For example the weighted average on energy savings vary from baseline to 

electronic is 37 kilowatt-hours per year when you weight all of those together. So I'm 

sure there will be many questions when you all have a chance to look at it and I will be 

happy to try and answer those in detail. 

Barbara Atkinson: 

Am I correct that if you wanted to add a savings for electronic to T8 you could do it here. 

Isaac Turiel: 

Oh sure, yes. It definitely could be done. 

Brookman: 

If there is any comment from the back please use the microphone. 

Tom Hagen, T & J Enterprises: 

In the format fixtures you are using two eiectronic reference targets? 

Isaac Turiel: 

Yes. No, one electronic and two magnetic. 

Hagen: 

Did I miss something down there on the format (not audible)? 

Isaac Turiel: 

No. One is electronic register. At the level two you see on the left maybe you see. 

45 

average comes from the ones below. There is four different, what it is those 2F40T12 

ballast's are occurring in different kind of fixtures so you've get different energy savings 

and also different price differentials depending on what fixture depending on whether it is 

was a falling out fixture, two or three. That is what we tried to do here. We have market 

shares on the right hand side from 38 down to 7 and 53 depending on what fixture type. 

And then we are doing weighted averages of what is being saved with each of those 

fixtures because all of that is put back into the top part to tell you what are the savings 

you get for a two lamp magnetic ballast in exchange for electronics. It is weighted among 

those four different fixture types. It is shown where Barbara is pointing to in those boxes 

there. For example the weighted average on energy savings vary from baseline to 

electronic is 37 kilowatt-hours per year when you weight all of those together. So I'm 

sure there will be many questions when you all have a chance to look at it and I will be 

happy to try and answer those in detail. 

Barbara Atkinson: 

Am I correct that if you wanted to add a savings for electronic to T8 you could do it here. 

Isaac Turiel: 

Oh sure, yes. It definitely could be done. 

Brookman: 

If there is any comment from the back please use the microphone. 

Tom Hagen, T & J Enterprises: 

In the format fixtures you are using two eiectronic reference targets? 

Isaac Turiel: 

Yes. No, one electronic and two magnetic. 

Hagen: 

Did I miss something down there on the format (not audible)? 

Isaac Turiel: 

No. One is electronic register. At the level two you see on the left maybe you see. 

45 
Tom:

Oh ok.

Isaac Turiel:

Level zero, level one, level two, not two of them.

Tom:

It is one floor lamp T12 electronic register ballast. Is that what you see up there?

Isaac Turiel:

Yes, correct. (Not audible) Before we go away from the spreadsheets are there any other

questions on the spreadsheets?

Howard Wolfman:

When we get back from lunch would it be possible to have copies that are a little more

legible than the ones in the hand out, of this one sheet?

Turiel:

(Not audible - many people discussing matter)

Howard Wolfinan

Maybe you could make it bigger.

Unknown:

You could do it on the one lamp type or one ballast type (not audible).

Turiel:

Or you could take one. Sure.

Howard Wolfrnan:

Its not the size, this if a fax copy a copy of a fax.

Isaac Turiel:

You mean clarity ok not the size. Is there a clean copy somewhere? I don't have it with

me. We will work on that and see what we can do.

Brookman:

Any additional questions, comments?

46

EE-RM-97-500 COMMENT 21OO

Tom: 

Ohok. 

Isaac Turiel: 

Level zero, level one, level two, not two of them 

Tom: 

It is one floor lamp TI2 electronic register ballast. Is that what you see up there? 

Isaac Turiel: 

Yes, correct. (Not audible) Before we go away from the spreadsheets are there any other 

questions on the spreadsheets? 

Howard Wol:finan: 

Turiel: 

When we get back from lunch would it be possible to have copies that are a little more 

legible than the ones in the hand out, of this one sheet? 

(Not audible - many people discussing matter) 

Howard Wol:finan; 

Maybe you could make it bigger. 

Unknown: 

You could do it on the one lamp type or one ballast type (not audible). 

Turiel: 

Or you could take one. Sure. 

Howard Wolfman: 

Its not the size, this if a fax copy a copy of a fax. 

Isaac Turie!: 

You mean clarity ok not the size. Is there a clean copy somewhere? I don't have it with 

me. We will work on that and see what we can do. 

Brookman: 

Any additional questions, comments? 

46 

Tom: 

Ohok. 

Isaac Turiel: 

Level zero, level one, level two, not two of them 

Tom: 

It is one floor lamp TI2 electronic register ballast. Is that what you see up there? 

Isaac Turiel: 

Yes, correct. (Not audible) Before we go away from the spreadsheets are there any other 

questions on the spreadsheets? 

Howard Wol:finan: 

Turiel: 

When we get back from lunch would it be possible to have copies that are a little more 

legible than the ones in the hand out, of this one sheet? 

(Not audible - many people discussing matter) 

Howard Wol:finan; 

Maybe you could make it bigger. 

Unknown: 

You could do it on the one lamp type or one ballast type (not audible). 

Turiel: 

Or you could take one. Sure. 

Howard Wolfman: 

Its not the size, this if a fax copy a copy of a fax. 

Isaac Turie!: 

You mean clarity ok not the size. Is there a clean copy somewhere? I don't have it with 

me. We will work on that and see what we can do. 

Brookman: 

Any additional questions, comments? 

46 
Brookman:

Any additional questions, comments?

Mark Perlis:

I just wanted to commend LDL for making up less(not audible) on the (not audible)

model.

Isaac Turiel:

You're welcome.

Brookrnan:

Any additional comments? Before we close out this segment?

Norm Grimshaw:

Norm Grimshaw from Advance Transformer. The data that you show here and the trend

line matches very well with the data that we have been keeping all along. Let me show

this and I think it will support your data quite well. What I have here, ignore the solid

dark lines. There are twelve data point rolls to straighten out some of the highs and lows

in the market but the bottom curve is the census data on electronic ballast all the way back

to 1987, I believe it is. Where it was very low in the market and it has been coming up.

The center curve is the CBM data, Certified Ballast Manufacturers data, that we collect on

just the types of ballast that are in this study so the comparison is very close, not totally

accurate but it is about 95%. The reason I show it is that it gives us a much longer trend

line than what we have been able to collect. The top curve is the addition of the two. By

dividing the electronics by the total we get the penetration of the electronics into the

marketplace. Again 95% accurate but you can see where it is and you can see what the

trend line is. That backs up the data that Isaac just showed you where the T12 is going

pretty much to zero. I personally don't believe that it will ever go zero if Michael will not

put out a regulation. And after Michael Rivest did this on the interview thing for the

manufacturers impact this is the kind of data I think we are going to use in our spreadsheet

for the GRIM model. What the top line is, is the curve that you just saw of the volumes

47

EE-RM-97-500 COMMENT 21OO

Brookman: 

Any additional questions, comments? 

Mark Pedis: 

I just wanted to commend LDL for making up less(not audible) on the (not audible) 

model. 

Isaac Turiel: 

You're welcome. 

Brook1;nan: 

Any additional comments? Before we close out this segment? 

Norm Grimshaw: 

Norm Grimshaw from Advance Transformer. The data that you show here and the trend 

line matches very well with the data that we have been keeping alI along. Let me show 

this and I think it will support your data quite well. What I have here, ignore the solid 

dark lines. There are twelve data point rolls to straighten out some of the highs and lows 

in the market but the bottom curve is the census data on electronic ballast all the way back 

to 1987, I believe it is. Where it was very low in the market and it has been coming up. 

The center curve is the CBM data, Certified Ballast Manufacturers data, that we collect on 

just the types ofbalIast that are in this study so the comparison is very close, not totally 

accurate but it is about 95%. The reason I show it is that it gives us a much longer trend 

line than what we have been able to collect. The top curve is the addition of the two. By 

dividing the electronics by the total we get the penetration of the electronics into the 

marketplace. Again 95% accurate but you can see where it is and you can see what the 

trend line is. That backs up the data that Isaac just showed you where the T12 is going 

pretty much to zero. I personally don't believe that it will ever go zero if Michael will not 

put out a regulation. And after Michael Rivest did this on the interview thing for the 

manufacturers impact this is the kind of data I think we are going to use in our spreadsheet 

for the GRIM model. What the top line is, is the curve that you just saw ofthe volumes 

47 

Brookman: 

Any additional questions, comments? 

Mark Pedis: 

I just wanted to commend LDL for making up less(not audible) on the (not audible) 

model. 

Isaac Turiel: 

You're welcome. 

Brook1;nan: 

Any additional comments? Before we close out this segment? 

Norm Grimshaw: 

Norm Grimshaw from Advance Transformer. The data that you show here and the trend 

line matches very well with the data that we have been keeping alI along. Let me show 

this and I think it will support your data quite well. What I have here, ignore the solid 

dark lines. There are twelve data point rolls to straighten out some of the highs and lows 

in the market but the bottom curve is the census data on electronic ballast all the way back 

to 1987, I believe it is. Where it was very low in the market and it has been coming up. 

The center curve is the CBM data, Certified Ballast Manufacturers data, that we collect on 

just the types ofbalIast that are in this study so the comparison is very close, not totally 

accurate but it is about 95%. The reason I show it is that it gives us a much longer trend 

line than what we have been able to collect. The top curve is the addition of the two. By 

dividing the electronics by the total we get the penetration of the electronics into the 

marketplace. Again 95% accurate but you can see where it is and you can see what the 

trend line is. That backs up the data that Isaac just showed you where the T12 is going 

pretty much to zero. I personally don't believe that it will ever go zero if Michael will not 

put out a regulation. And after Michael Rivest did this on the interview thing for the 

manufacturers impact this is the kind of data I think we are going to use in our spreadsheet 

for the GRIM model. What the top line is, is the curve that you just saw ofthe volumes 

47 
from the census and CDM and you can see the slope is a little bit steeper from the 95 to

99 era on. I have used the square footage of buildings out of your report last year Table

5.1 and that is the exact same percentage increase in buildings or percentage increase in

total ballast, just an assumption but I think we will at least keep up with the square

footage. Hopefully we will penetrate even more. But that is the total number of ballast

that will be sold. The bottom line, the magnetic ballast I think will continue on down on

about the 5% a year rate that is going down now. And it will level off at some level where

applications demand a magnetic ballast. A line frequency ballast so that is, rather than go

all the way to zero. I think that probably is a more realistic curve and of course the center

line is just the difference between the two.

Barbara Atkinson:

Norm, why do you add the CDM and the census numbers?

Norm Grimshaw:

In the CDM system virtually the only ballast that we count and have for years are the same

ones in your study. Give or take one or two, it is very close and the only ones we are

making in electronic are the ones in your study. Very close and so by comparing those

two which is data that we have all the way back into the 80's gives us a much fuller chart

than we have been able to out together for you.

Barbara Atkinson:

Did you say you added the two together?

Norm Grimshaw:

That is the top line, yes.

Unknown:

One is electronic and one is magnetic is that what I get?

Norm Grimshaw:

The census stated is all electronic.

Unknown:

48

EE-RM-97-500 COMMENT 21OO

from the census and CDM and you can see the slope is a little bit steeper from the 95 to 

99 era on. I have used the square footage of buildings out of your report last year Table 

5.1 and that is the exact same percentage increase in buildings or percentage increase in 

total ballast, just an assumption but I think we will at least keep up with the square 

footage. Hopefully we will penetrate even more. But that is the total number of ballast 

that will be sold. The bottom line, the magnetic ballast I think will continue on down on 

about the 5% a year rate that is going down now. And it will level off at some level where 

applications demand a magnetic ballast. A line frequency ballast so that is, rather than go 

all the way to zero. I think that probably is a more realistic curve and of course the center 

line is just the difference between the two. 

Barbara Atkinson: 

Norm, why do you add the CDM and the census numbers? 

Norm Grimshaw: 

In the CDM system virtually the only ballast that we count and have for years are the same 

ones in your study. Give or take one or two, it is very close and the only ones we are 

making in electronic are the ones in your study. Very close and so by comparing those 

two which is data that we have all the way back into the 80's gives us a much fuller chart 

than we have been able to put together for you. 

Barbara Atkinson: 

Did you say you added the two together? 

Norm Grimshaw: 

That is the top line, yes. 

Unknown: 

One is electronic and one is magnetic is that what I get? 

Norm Grimshaw: 

The census stated is all electronic. 

Unknown: 

48 

from the census and CDM and you can see the slope is a little bit steeper from the 95 to 

99 era on. I have used the square footage of buildings out of your report last year Table 

5.1 and that is the exact same percentage increase in buildings or percentage increase in 

total ballast, just an assumption but I think we will at least keep up with the square 

footage. Hopefully we will penetrate even more. But that is the total number of ballast 

that will be sold. The bottom line, the magnetic ballast I think will continue on down on 

about the 5% a year rate that is going down now. And it will level off at some level where 

applications demand a magnetic ballast. A line frequency ballast so that is, rather than go 

all the way to zero. I think that probably is a more realistic curve and of course the center 

line is just the difference between the two. 

Barbara Atkinson: 

Norm, why do you add the CDM and the census numbers? 

Norm Grimshaw: 

In the CDM system virtually the only ballast that we count and have for years are the same 

ones in your study. Give or take one or two, it is very close and the only ones we are 

making in electronic are the ones in your study. Very close and so by comparing those 

two which is data that we have all the way back into the 80's gives us a much fuller chart 

than we have been able to put together for you. 

Barbara Atkinson: 

Did you say you added the two together? 

Norm Grimshaw: 

That is the top line, yes. 

Unknown: 

One is electronic and one is magnetic is that what I get? 

Norm Grimshaw: 

The census stated is all electronic. 

Unknown: 

48 
Okay, I'm sorry.

Norm Grimshaw:

The CDM data is all magnetic.

Unknown:

Okay to get the total.

Norm Grimshaw:

They compare very closely and it gives us a much longer trend than we have otherwise.

Barbara Atkinson:

I assume you will be submitting these with your costs?

Norm Grimshaw:

They have been in all our reports yes.

Unknown:

Questions for Norm's presentation before we move on or comments. Thank you Norm.

Unknown:

I want to talk about the one that Mike designed.

Unknown:

This is just a reminder and a request from the Department - those of you that have slides

and have shown slides or have visuals to present, please make a copy of those available to

the Department. Either at the conclusion of this meeting or as they cover your comments.

Unknown:

What I'm going to do now is go the last two slides of the morning presentation and one

was one that Mike Stein commented on which showed what the results were from using

that spreadsheet from two different scenarios. You actually have it so I guess maybe I

can start discussing it while we are trying to get it up there. The one that says what the

energy savings were that were obtained by using a constant shipment scenario and take

that trend line that we showed before. (Not audible) I think it is a 1.1 quad. The low

number up to that, 4.5 roughly for the high number and we will get that up here right now

49

EE-RM-97-500 COMMENT 21OO

Okay, I'm sorry. 

Norm Grimshaw: 

The CDM data is all magnetic. 

Unknown: 

Okay to get the total. 

Norm Grimshaw: 

They compare very closely and it gives us a much longer trend than we have otherwise. 

Barbara Atkinson: 

I assume you will be submitting these with your costs? 

Norm Grimshaw: 

They have been in all our reports yes. 

Unknown: 

Questions for Norm's presentation before we move on or comments. Thank you Norm. 

Unknown: 

I want to talk about the one that Mike designed. 

Unknown: 

This is just a reminder and a request from the Department - those of you that have slides 

and have shown slides or have visuals to present, please make a copy of those available tlO 

the Department. Either at the conclusion of this meeting or as they cover your comments. 

Unknown: 

What I'm going to do now is go the hb1; two slides of the morning presentation and one 

was one that Mike Stein commented on which showed what the results were from using 

that spreadsheet :from two different scenarios. You actually have it so I guess maybe I 

can start discussing it while we are trying to get it up there. The one that says what the 

energy savings were that were obtained by using a constant shipment scenario and take 

that trend line that we showed before. (Not audible) I think it is a 1.1 quad. The low 

number up to that, 4.5 roughly for the high number and we will get that up here right now. 

49 

Okay, I'm sorry. 

Norm Grimshaw: 

The CDM data is all magnetic. 

Unknown: 

Okay to get the total. 

Norm Grimshaw: 

They compare very closely and it gives us a much longer trend than we have otherwise. 

Barbara Atkinson: 

I assume you will be submitting these with your costs? 

Norm Grimshaw: 

They have been in all our reports yes. 

Unknown: 

Questions for Norm's presentation before we move on or comments. Thank you Norm. 

Unknown: 

I want to talk about the one that Mike designed. 

Unknown: 

This is just a reminder and a request from the Department - those of you that have slides 

and have shown slides or have visuals to present, please make a copy of those available tlO 

the Department. Either at the conclusion of this meeting or as they cover your comments. 

Unknown: 

What I'm going to do now is go the hb1; two slides of the morning presentation and one 

was one that Mike Stein commented on which showed what the results were from using 

that spreadsheet :from two different scenarios. You actually have it so I guess maybe I 

can start discussing it while we are trying to get it up there. The one that says what the 

energy savings were that were obtained by using a constant shipment scenario and take 

that trend line that we showed before. (Not audible) I think it is a 1.1 quad. The low 

number up to that, 4.5 roughly for the high number and we will get that up here right now. 

49 
Ok, as it says here we looked at those two possible scenarios, constant declining

shipments and we found from 1.1 to 4.5 quad and I mean you can't really compare that

because the different shipments were used (not audible) but just to give you an idea of

what was in the draft report that would range from 1.5 to 5.3 quad. If there aren't any

questions here I will just go on to the very last.

Unknown:

(Not audible) is the 97 draft of the two numbers shown. The most likely case would be

2.1 quad. There was a page that was on the low side that shows .5 as the sensitivity or

extreme (not audible) and there was a number on the other side of 2.1 (not audible) which

is another extreme shown of 5.3 which would put those at a very extreme scenario which

has almost no chance of happening and we found the balance there again objectionable and

what we particularly found objectionable was that in all of that report the Federal Register

notice was put out it said savings are up to 5.3 quads and we found that just to be an

extreme gross exaggeration and we found that objectionable. We would note that if the

sensitivity balances on either side of the central and most likely scenario are in balance that

certainly it won't be wrong and information wrong and strike it from (not audible).

Unknown:

Finally the Utility Environmental Analysis. The proposal to use NEMS, the National

Energy Modeling System the EIA Model. The reason is that a better representation, not

perfect but a better representation of the complexity of the energy market and its also of

the same places we are getting our electricity price forecast is a more consistent approach

to use that. The output that would come out of this would be both for utility and the

environmental analysis would be the change in net generating capacity, change in national

generating fuel mix, retail electricity price and also we get information on carbon dioxide

and nitrogen oxide emission reduction. So this was previously done by a model called

ASEUM. The proposal that they tend now is to convert to a DOE/EIA model NEMS so I

have prepared notes to tell you about that.

50

EE-RM-97-500 COMMENT 21OO

Ok, as it says here we looked at those two possible scenarios, constant declining 

shipments and we found from 1.1 to 4.5 quad and I mean you can't really compare that 

because the different shipments were used (not audible) but just to give you an idea of 

what was in the draft report that would range from 1.5 to 5.3 quad. Ifthere aren't any 

questions here I will just go on to the very last. 

Unknown: 

(Not audible) is the 97 draft of the two numbers shown. The most likely case would be 

2.1 quad. There was a page that was on the low side that shows .5 as the sensitivity or 

extreme (not audible) and there was a number on the other side of2.1 (not audible) which 

is another extreme shown of5.3 which would put those at a very extreme scenario which 

has almost no chance ofhappening and we found the balance there again objectionable and 

what we particularly found objectionable was that in all of that report the Federal Register 

notice was put out it said savings are up to 5.3 quads and we found that just to be an 

extreme gross exaggeration and we found that objectionable. We would note that if the 

sensitivity balances on either side of the central and most likely scenario are in balance that 

certainly it won't be wrong and information wrong and strike it from (not audible). 

Unknown: 

Finally the Utility Environmental Analysis. The proposal to use NEMS, the National 

Energy Modeling System the EIA Model. The reason is that a better representation, not 

perfect but a better representation of the complexity of the energy market and its also of 

the same places we are getting our electricity price forecast is a more consistent approach 

to use that. The output that would come out of this would be both for utility and the 

environmental analysis would be the change in net generating capacity, change in national 

generating fuel mix, retail electricity price and also we get information on carbon dioxide 

and nitrogen oxide emission reduction. So this was previously done by a model called 

ASEUM. The proposal that they tend now is to convert to a DOEIEIA model NEMS so I 

have prepared notes to tell you about that. 

50 

Ok, as it says here we looked at those two possible scenarios, constant declining 

shipments and we found from 1.1 to 4.5 quad and I mean you can't really compare that 

because the different shipments were used (not audible) but just to give you an idea of 

what was in the draft report that would range from 1.5 to 5.3 quad. Ifthere aren't any 

questions here I will just go on to the very last. 

Unknown: 

(Not audible) is the 97 draft of the two numbers shown. The most likely case would be 

2.1 quad. There was a page that was on the low side that shows .5 as the sensitivity or 

extreme (not audible) and there was a number on the other side of2.1 (not audible) which 

is another extreme shown of5.3 which would put those at a very extreme scenario which 

has almost no chance ofhappening and we found the balance there again objectionable and 

what we particularly found objectionable was that in all of that report the Federal Register 

notice was put out it said savings are up to 5.3 quads and we found that just to be an 

extreme gross exaggeration and we found that objectionable. We would note that if the 

sensitivity balances on either side of the central and most likely scenario are in balance that 

certainly it won't be wrong and information wrong and strike it from (not audible). 

Unknown: 

Finally the Utility Environmental Analysis. The proposal to use NEMS, the National 

Energy Modeling System the EIA Model. The reason is that a better representation, not 

perfect but a better representation of the complexity of the energy market and its also of 

the same places we are getting our electricity price forecast is a more consistent approach 

to use that. The output that would come out of this would be both for utility and the 

environmental analysis would be the change in net generating capacity, change in national 

generating fuel mix, retail electricity price and also we get information on carbon dioxide 

and nitrogen oxide emission reduction. So this was previously done by a model called 

ASEUM. The proposal that they tend now is to convert to a DOEIEIA model NEMS so I 

have prepared notes to tell you about that. 

50 
Unknown:

Final questions or comments based on the spreadsheet or any of what has proceeded this.

Michael

Michael Rivest:

As far as the HEMS model, you will be doing the analysis correct?

Unknown:

Correct.

Michael Rivest:

And with a HEMS is exactly as EIA has it at that point in time or with some modification?

Unknown:

Well it is going to be called NEMS slash something or other but in terms of really being

different, it is not really going to be different.

Unknown:

I think that EIA has always been what I would like to make clear, this will not be an

analysis that will be done by EIA but will be an analysis using a model that we derived

from EIA NEMS model. The EIA will take (not audible) of their tools and their work

quite seriously. I don't want it to appear to anybody that it is an EIA analysis.

Unknown:

Thank you for that clarification. Final questions or comments before we move on to the

last presentation before lunch. Okay Barry Berlin is next and Barry I will let you.

Barry Berlin:

Thank you very much. Hi, I'm Barry Berlin. As part of department improvement we

made some commitment in our department to take a look at employment impacts. The

direct employment impact will be determined in the manufacturer impact analysis. The

indirect employment impact, which can be quite large, will be analyzed separately and that

is what I'm going to talk about today. You get an idea of how much expenditure is

involved. The commercial sector spends approximately twenty-five and a half billion

51

EE-RM-97-500 COMMENT 21OO

Unknown: 

Final questions or comments based on the spreadsheet or any of what has proceeded this. 

Michael 

Michael Rivest: 

As far as the NEMS model, you will be doing the analysis correct? 

Unknown: 

Correct. 

Michael Rivest: 

And with a NEMS is exactly as EIA has it at that point in time or with some modification? 

Unknown: 

Well it is going to be called NEMS slash something or other but in terms of really being 

different, it is not really going to be different. 

Unknown: 

I think that EIA has always been what I would like to make clear, this will not be an 

analysis that will be done by EIA but will be an analysis using a model that we derived 

from EIA NEMS model The EIA will take (not audible) of their tools and their work 

quite seriously. I don't want it to appear to anybody that it is an EIA analysis. 

Unknown: 

Thank you for that clarification. Final questions or comments before we move on to the 

last presentation before lunch. Okay Barry Berlin is next and Barry I will let you. 

Barry Berlin: 

Thank you very much. Hi, I'm Barry Berlin. As part of department improvement we 

made some commitment in our department to take a look at employment impacts. The 

direct employment impact will be determined in the manufacturer impact analysis. The 

indirect employment impact, which can be quite large, will be analyzed separately and that 

is what I'm going to talk about today. You get an idea of how much expenditure is 

involved. The commercial sector spends approximately twenty-five and a halfbillion 

51 

Unknown: 

Final questions or comments based on the spreadsheet or any of what has proceeded this. 

Michael 

Michael Rivest: 

As far as the NEMS model, you will be doing the analysis correct? 

Unknown: 

Correct. 

Michael Rivest: 

And with a NEMS is exactly as EIA has it at that point in time or with some modification? 

Unknown: 

Well it is going to be called NEMS slash something or other but in terms of really being 

different, it is not really going to be different. 

Unknown: 

I think that EIA has always been what I would like to make clear, this will not be an 

analysis that will be done by EIA but will be an analysis using a model that we derived 

from EIA NEMS model The EIA will take (not audible) of their tools and their work 

quite seriously. I don't want it to appear to anybody that it is an EIA analysis. 

Unknown: 

Thank you for that clarification. Final questions or comments before we move on to the 

last presentation before lunch. Okay Barry Berlin is next and Barry I will let you. 

Barry Berlin: 

Thank you very much. Hi, I'm Barry Berlin. As part of department improvement we 

made some commitment in our department to take a look at employment impacts. The 

direct employment impact will be determined in the manufacturer impact analysis. The 

indirect employment impact, which can be quite large, will be analyzed separately and that 

is what I'm going to talk about today. You get an idea of how much expenditure is 

involved. The commercial sector spends approximately twenty-five and a halfbillion 

51 
dollars for lighting in 1996 and industrials looks like it is approximately two billion dollars.

The story is on this is that basically any money saved in energy expenditures or spent

elsewhere will be moving from areas where the labor intensity such as in the energy

industry is fairly low to sectors of the economy where the labor intensity might be higher.

You get a job generation from that. There is an input/output model developed in a PNLL

that we can use to make this estimation and it will be available to everybody who wants it.

A spreadsheet model. Thirty-Five specters of the economy interconnected and obviously

shifts from sector will move into another sector and thus we can track the employment

effects from that. And the last line is just talking about how the reduced expenditures will

move into other sectors so the money will move into other sectors and cause the net

employment to benefit. A couple of studies that have shown up. In 1994 former

Secretary O'Leary testified before the Senate Appropriations Committee that for every

million dollars of energy saved there was a net increase in employment of 10 to 20 jobs. I

have not seen the study but that was an estimate and another wrinkle. Skip Lazur of

Eaton James, who is recognized as some sort of expert in this area has estimated that for

every quadrillion ETU's of energy saved that there is a net increase of 52,000 jobs and I

have not seen that study either. Just to give you an idea of some of the efforts that might

be involved. One other thing that I have been asked to talk about is this Regulatory

Impact Analysis. This is something we do for the Office of Management and Budget

when we send our rule makings for their review. It has been required by a series of

executive orders beginning in this program at the present time.

Unknown:

Pardon me for interrupting. There may be questions on your first presentation.

Barry Berlin:

Okay, I apologize. Any, questions on the employment impact work that we are going to

try to do.

Unknown:

52

EE-RM-97-500 COMMENT 21OO

dollars for lighting in 1996 and industrials looks like it is approximately two billion dollars. 

The story is on this is that basically any money saved in energy expenditures or spent 

elsewhere will be moving from areas where the labor intensity such as in the energy 

industry is fairly low to sectors of the economy where the labor intensity might be higher. 

You get ajob generation from that. There is an input/output model developed in a PNLL 

that we can use to make this estimation and it will be available to everybody who wants it. 

A spreadsheet model. Thirty-Five specters ofthe economy interconnected and obviously 

shifts from sector will move into another sector and thus we can track the employment 

effects from that. And the last line is just talking about how the reduced expenditures will 

move into other sectors so the money will move into other sectors and cause the net 

employment to benefit. A couple of studies that have shown up. In 1994 former 

Secretary O'Leary testified before the Senate Appropriations Committee that for every 

million dollars of energy saved there was a net increase in employment of 10 to 20 jobs. I 

have not seen the study but that was an estimate and another wrinkle. Skip Lazur of 

Eaton James, who is recognized as some sort of expert in this area has estimated that for 

every quadrillion ETU's of energy saved that there is a net increase of 52,000 jobs and I 

have not seen that study either. Just to give you an idea of some of the efforts that might 

be involved. One other thhlg that I have been asked to talk about is this Regulatory 

Impact Analysis. This is something we do for the Office of Management and Budget 

when we send our rule makings for their review. It has been required by a series of 

executive orders beginning in this program at the present time. 

Unknown: 

Pardon me for interrupting. There may be questions on your first presentation. 

Barry Berlin: 

Okay, I apologize. Any questions on the employment impact work that we are going to 

try to do. 

Unknown: 

52 

dollars for lighting in 1996 and industrials looks like it is approximately two billion dollars. 

The story is on this is that basically any money saved in energy expenditures or spent 

elsewhere will be moving from areas where the labor intensity such as in the energy 

industry is fairly low to sectors of the economy where the labor intensity might be higher. 

You get ajob generation from that. There is an input/output model developed in a PNLL 

that we can use to make this estimation and it will be available to everybody who wants it. 

A spreadsheet model. Thirty-Five specters ofthe economy interconnected and obviously 

shifts from sector will move into another sector and thus we can track the employment 

effects from that. And the last line is just talking about how the reduced expenditures will 

move into other sectors so the money will move into other sectors and cause the net 

employment to benefit. A couple of studies that have shown up. In 1994 former 

Secretary O'Leary testified before the Senate Appropriations Committee that for every 

million dollars of energy saved there was a net increase in employment of 10 to 20 jobs. I 

have not seen the study but that was an estimate and another wrinkle. Skip Lazur of 

Eaton James, who is recognized as some sort of expert in this area has estimated that for 

every quadrillion ETU's of energy saved that there is a net increase of 52,000 jobs and I 

have not seen that study either. Just to give you an idea of some of the efforts that might 

be involved. One other thhlg that I have been asked to talk about is this Regulatory 

Impact Analysis. This is something we do for the Office of Management and Budget 

when we send our rule makings for their review. It has been required by a series of 

executive orders beginning in this program at the present time. 

Unknown: 

Pardon me for interrupting. There may be questions on your first presentation. 

Barry Berlin: 

Okay, I apologize. Any questions on the employment impact work that we are going to 

try to do. 

Unknown: 

52 
You went through that pretty fast.

Norm Grimshaw:

Just one question. Obviously this is a totally new subject as far as (not audible) is

concerned and if it is something that is being done these days I assume that we are going

to see what is being done and have a chance to comment on (not audible).

Barry Berlin:

Absolutely. As things develop and are being made available for public review including

the model which Bill, which will be used, that will be made available.

Unknown:

Thank you. Any questions.

Barry Berlin:

The other thing I was asked to talk about is this Regulatory Impact Analysis that is

required by OMB when we send our rules over there. The first executive order to affect

the program was one under President Carter where the goal was that if we could achieve

the efficiency gained on the energy savings by a cheaper cost method such as an

alternative to regulations that the agency or whoever was doing it at that time was

supposed to do that. Under President Reagan there was a similar executive order. They

were basically cost minim^ticn kinds of activities. The President executive order under

President Clinton the way it exists says that for significant regulatory actions which in this

program an annual impact of three million dollars per year or more that we have to

conduct this review of alternatives of regulation. One of the methods that we are going to

use to look at these alternatives will be a NEM spreadsheet. The spreadsheet will give us

the answers but the impact of both of these options will happen through changes in

shipments when we look at tax credits, rebates and so on. The biggest impact is in

shipment that as Isaac Turiel said earlier shipments are an input to these spreadsheets so

we will have to develop the shipments forecast elsewhere and it is mostly (not audible) and

we will report the energy savings and input value in the different alternatives. The other

53

EE-RM-97-500 COMMENT 21OO

You went through that pretty fast. 

Norm Grimshaw: 

Just one question. Obviously this is a totally new subject as far as (not audible) is 

concerned and if it is something that is being done these days I assume that we are going 

to see what is being done and have a chance to comment on (not audible). 

Barry Berlin: 

Absolutely. As things develop and are being made available for public review including 

the model which Bill, which will be used, that will be made available. 

Unknown: 

Thank you. Any questions. 

Barry Berlin: 

The other thing I was asked to talk about is this Regulatory Impact Analysis that is 

required by OMB when we send our rules over there. The first executive order to affect 

the program was one under President Carter where the goal was that if we could achieve 

the efficiency gained on the energy savings by a cheaper cost method such as an 

alternative to regulations that the agency or whoever was doing it at that time was 

supposed to do that. Under President Reagan there was a similar executive order. They 

were basically cost minirruzation kinds of activities. The President executive order under 

President Clinton the way it exists says that for significant regulatory actions which in this 

program an annual impact of three million dollars per year or more that we have to 

conduct this review of alternatives of regulation. One of the methods that we are going to 

use to look at these alternatives will be a NEM spreadsheet. The spreadsheet will give us 

the answers but the impact of both of these options will happen through changes in 

shipments when we look at tax credits, rebates and so on. The biggest impact is in 

shipment that as Isaac Turiel said earlier shipments are an input to these spreadsheets so 

we will have to develop the shipments forecast elsewhere and it is mostly (not audible) and 

we will report the energy savings and input value in the different alternatives. The other 

53 

You went through that pretty fast. 

Norm Grimshaw: 

Just one question. Obviously this is a totally new subject as far as (not audible) is 

concerned and if it is something that is being done these days I assume that we are going 

to see what is being done and have a chance to comment on (not audible). 

Barry Berlin: 

Absolutely. As things develop and are being made available for public review including 

the model which Bill, which will be used, that will be made available. 

Unknown: 

Thank you. Any questions. 

Barry Berlin: 

The other thing I was asked to talk about is this Regulatory Impact Analysis that is 

required by OMB when we send our rules over there. The first executive order to affect 

the program was one under President Carter where the goal was that if we could achieve 

the efficiency gained on the energy savings by a cheaper cost method such as an 

alternative to regulations that the agency or whoever was doing it at that time was 

supposed to do that. Under President Reagan there was a similar executive order. They 

were basically cost minirruzation kinds of activities. The President executive order under 

President Clinton the way it exists says that for significant regulatory actions which in this 

program an annual impact of three million dollars per year or more that we have to 

conduct this review of alternatives of regulation. One of the methods that we are going to 

use to look at these alternatives will be a NEM spreadsheet. The spreadsheet will give us 

the answers but the impact of both of these options will happen through changes in 

shipments when we look at tax credits, rebates and so on. The biggest impact is in 

shipment that as Isaac Turiel said earlier shipments are an input to these spreadsheets so 

we will have to develop the shipments forecast elsewhere and it is mostly (not audible) and 

we will report the energy savings and input value in the different alternatives. The other 

53 
thing that I want to talk about is the alternatives that we have looked at in the past. The

no action alternative is essentially the base case forecast which is we do nothing in this

department other than what the market is going to do by itself. Now the no action

alternative includes all the non-regulatory actions going on into which DFM, energy stock

and so on. So those programs will be counted in base case forecast as a no action

alternative. Consumer tax credits, in the past we have looked at a tax credit of about 15%

for the increase price of an efficient appliance. This was originally developed under the

Energy Tax Act of 1978 and we maintain that as an assumption. Other assumptions can

be used but that is the one we are using right now. Making an investment tax credit we

have assumed in the past that an investment tax credit of 20% of the increased price for

investment for energy equipment and tools for producing energy efficient appliances and

we will probably continue that assumption. Consumer rebates again were the Energy Tax

Act of 1978 we are assuming a 15% rebate at the increased price for efficient appliances.

Prescriptive standards we are going to remove at this time. The problem with prescriptive

standards is that we prescribe a component of some sort or a design and it affects

manufacturers different ways because most manufacturers build their units in different

ways so that it might affect one manufacturer who estimate radical changes and another

manufacturer who makes no changes and it creates a very unlevel playing field. The other

problem is that just changing a component and making it more efficient doesn't guarantee

the efficiency of the unit, which could lead, and then therefore the energy savings are

uncertain. So we probably won't even look at this one again. Plus this attempts to be (not

audible) in this department that we wouldn't want a prescriptive standard anyway.

Voluntary standards, this really should be read as voluntary targets. The old targets the

program. Most people may not know this but when this program began it began in the

Department of Commerce after the oil crisis shock of 73-74 they developed a targets

program. It never really got off the ground but in 75 the Energy Cost and Compensation

Act transferred the activity to the FDA but the Commerce had the Act briefly. We look at

54

EE-RM-97-500 COMMENT 21OO

thing that I want to talk about is the alternatives that we have looked at in the past. The 

no action alternative is essentially the base case forecast which is we do nothing in this 

department other than what the market is going to do by itself Now the no action 

alternative includes all the non-regulatory actions going on into which DFM, energy stock 

and so on. So those programs will be counted in base case forecast as a no action 

alternative. Consumer tax credits, in the past we have looked at a tax credit of about 15% 

for the increase price of an efficient appliance. This was originally developed under the 

Energy Tax Act of 1978 and we maintain that as an assumption. Other assumptions can 

be used but that is the one we are using right now. Making an investment tax credit we 

have assumed in the past that an investment tax credit of20% of the increased price for 

investment for energy equipment and tools for producing energy efficient appliances and 

we will probably continue that assumption. Consumer rebates again were the Energy Tax 

Act of 1978 we are assuming a 15% rebate at the increased price for efficient appliances. 

Prescriptive standards we are going to remove at this time. The problem with prescriptive 

standards is that we prescribe a component of some sort or a design and it affects 

manufacturers different ways because most manufacturers build their units in different 

ways so that it might affect one manufacturer who estimate radical changes and another 

manufacturer who makes no changes and it creates a very unlevel playing field. The other 

problem is that just changing a component and making it more efficient doesn't guarantee 

the efficiency of the unit, which could lead, and then therefore the energy savings are 

uncertain. So we probably won't even look at this one again. Plus this attempts to be (not 

audible) in this department that we wouldn't want a prescriptive standard anyway. 

Voluntary standards, this really should be read as voluntary targets. The old targets the 

program. Most people may not know this but when this program began it began in the 

Department of Commerce after the oil crisis shock of 73-7 4 they developed a targets 

program. It never really got off the ground but in 75 the Energy Cost and Compensation 

Act transferred the activity to the FDA but the Commerce had the Act briefly. We look at 

54 

thing that I want to talk about is the alternatives that we have looked at in the past. The 

no action alternative is essentially the base case forecast which is we do nothing in this 

department other than what the market is going to do by itself Now the no action 

alternative includes all the non-regulatory actions going on into which DFM, energy stock 

and so on. So those programs will be counted in base case forecast as a no action 

alternative. Consumer tax credits, in the past we have looked at a tax credit of about 15% 

for the increase price of an efficient appliance. This was originally developed under the 

Energy Tax Act of 1978 and we maintain that as an assumption. Other assumptions can 

be used but that is the one we are using right now. Making an investment tax credit we 

have assumed in the past that an investment tax credit of20% of the increased price for 

investment for energy equipment and tools for producing energy efficient appliances and 

we will probably continue that assumption. Consumer rebates again were the Energy Tax 

Act of 1978 we are assuming a 15% rebate at the increased price for efficient appliances. 

Prescriptive standards we are going to remove at this time. The problem with prescriptive 

standards is that we prescribe a component of some sort or a design and it affects 

manufacturers different ways because most manufacturers build their units in different 

ways so that it might affect one manufacturer who estimate radical changes and another 

manufacturer who makes no changes and it creates a very unlevel playing field. The other 

problem is that just changing a component and making it more efficient doesn't guarantee 

the efficiency of the unit, which could lead, and then therefore the energy savings are 

uncertain. So we probably won't even look at this one again. Plus this attempts to be (not 

audible) in this department that we wouldn't want a prescriptive standard anyway. 

Voluntary standards, this really should be read as voluntary targets. The old targets the 

program. Most people may not know this but when this program began it began in the 

Department of Commerce after the oil crisis shock of 73-7 4 they developed a targets 

program. It never really got off the ground but in 75 the Energy Cost and Compensation 

Act transferred the activity to the FDA but the Commerce had the Act briefly. We look at 

54 
this at this just as a performance standard that we are considering are achieved with either

a five or a ten year delay to get the estimate. In consumer education we are also going to

do away with. The Energy Star program effectively did that and that will be counted as

ongoing any effects from that will be outstanding base (not audible) forecast on a no

action alternative and the performance standards of course are the standards that we might

decide to propose. For the new list looks like the old list except minus those two options.

We have also identified a mass government purchase idea. In this scenario what we will

do is we will assume that all federal, state and local purchases are valid from the energy

efficient point and that would be the working assumption. This idea has its origins as

many of you may know in the Old Swedish energy - what would be a refrigerator

program. The golden parrot program where the government purchased energy efficient

refrigerators and installed them in the housing units in the various jurisdictions. This was a

very successful program that we mimicked in this country by utilities where it was less

successful and we needn't get into the reasons for that. But that was the origin of the idea

of having governments use their purchasing power to stimulate market (not audible) and

that is what we will assume for this.

Unknown:

Barry make sure that you don't do some double accounting on that one because I think the

federal government purchasing is pretty well part of the base now because of the executive

order that requires the energy approval on the part of the federal government.

Barry Berlin:

Thank you, you are right. Earlier we heard that FEM had the purchasing program and

that would be counted in the base case and there are also some local jurisdictions that have

used mass purchases in their locality for purchasing efficiency. So that too would be in a

base case forecast. There would be some (not audible) out but would not be totally

federal, state and local minus current activity.

Unknown:

55

EE-RM-97-500 COMMENT 21OO

this at this just as a performance standard that we are considering are achieved with either 

a five or a ten year delay to get the estimate. In consumer education we are also going to 

do away with. The Energy Star program effectively did that and that will be counted as 

ongoing any effects from that will be outstanding base (not audible) forecast on a no 

action alternative and the performance standards of course are the standards that we might 

decide to propose. For the new list looks like the old list except minus those two options. 

We have also identified a mass government purchase idea. In this scenario what we will 

do is we will assume that all federal, state and local purchases are valid from the energy 

efficient point and that would be the working assumption This idea has its origins as 

many of you may know in the Old Swedish energy - what would be a refrigerator 

program. The golden parrot program where the government purchased energy efficient 

refrigerators and installed them in the housing units in the various jurisdictions. This was a 

very successful program that we mimicked in this country by utilities where it was less 

successful and we needn't get into the reasons for that. But that was the origin of the idea 

of having governments use their purchasing power to stimulate market (not audtble) and 

that is what we will assume for this. 

Unknown: 

Barry make sure that you dun't do some double accounting on that one because I think the 

federal government purchasing is pretty well part of the base now because of the executive 

order that requires the energy approval on the part of the federal government. 

Barry Berlin: 

Thank you, you are right. Earlier we heard that FEM had the purchasing program and 

that would be counted in the base case and there are also some local jurisdictions that have 

used mass purchases in their locality for purchasing efficiency. So that too would be in a 

base case forecast. There would be some (not audible) out but would not be totally 

federa~ state and local minus current activity. 

Unknown: 

55 

this at this just as a performance standard that we are considering are achieved with either 

a five or a ten year delay to get the estimate. In consumer education we are also going to 

do away with. The Energy Star program effectively did that and that will be counted as 

ongoing any effects from that will be outstanding base (not audible) forecast on a no 

action alternative and the performance standards of course are the standards that we might 

decide to propose. For the new list looks like the old list except minus those two options. 

We have also identified a mass government purchase idea. In this scenario what we will 

do is we will assume that all federal, state and local purchases are valid from the energy 

efficient point and that would be the working assumption This idea has its origins as 

many of you may know in the Old Swedish energy - what would be a refrigerator 

program. The golden parrot program where the government purchased energy efficient 

refrigerators and installed them in the housing units in the various jurisdictions. This was a 

very successful program that we mimicked in this country by utilities where it was less 

successful and we needn't get into the reasons for that. But that was the origin of the idea 

of having governments use their purchasing power to stimulate market (not audtble) and 

that is what we will assume for this. 

Unknown: 

Barry make sure that you dun't do some double accounting on that one because I think the 

federal government purchasing is pretty well part of the base now because of the executive 

order that requires the energy approval on the part of the federal government. 

Barry Berlin: 

Thank you, you are right. Earlier we heard that FEM had the purchasing program and 

that would be counted in the base case and there are also some local jurisdictions that have 

used mass purchases in their locality for purchasing efficiency. So that too would be in a 

base case forecast. There would be some (not audible) out but would not be totally 

federa~ state and local minus current activity. 

Unknown: 

55 
Any questions on this part.

Unknown:

Barry does this mean that the department has concluded that this is a significant regulatory

action and requires regulatory impact analysis.

Barry Berlin:

Well if we estimate the effect on the economy will be an annual effect of one hundred

million dollars then we would conduct the regulatory impact analysis that is required by

the executive order.

Unknown:

Has the department decided that changing ballast standards would have a one million

dollar impact on the economy?

Barry Berlin:

We don't know where the standards would come out so we haven't derived that. In the

past all the rule making has been in excess of whatever the figure was and when we have

gone to OMB (not audible) of an impact analysis.

Unknown:

And when you go to OMB before the gain , before the (not audible) or only before final

rule.

Barry Berlin:

They wouldn't want to, it will be after the number they don't want to see anything until it

is proposed.

Unknown:

But will it be before you go with the final rule. In other words, will the public or

stakeholders have an opportunity to comment on it independently of the final rule going to

OMB?

Barry Berlin:

56

EE-RM-97-500 COMMENT 21OO

Any questions on this part. 

Unknown: 

Barry does this mean that the department has concluded that this is a significant regulatory 

action and requires regulatory impact analysis. 

Barry Berlin: 

Well ifwe estimate the effect on the economy will be an annual effect of one hundred 

million dollars then we would conduct the regulatory impact analysis that is required by 

the executive order. 

Unknown: 

Has the department decided that changing ballast standards would have a one million 

dollar impact on the economy? 

Barry Berlin: 

We don't know where the standards would come out so we haven't derived that. In the 

past all the rule making has been in excess of whatever the figure was and when we have 

gone to OMB (not audible) of an impact analysis. 

Unknown: 

And when you go to OMB before the gain, before the (not audible) or only before final 

rule. 

Barry Berlin: 

They wouldn't want to, it will be after the number they don't want to see anything until it 

is proposed. 

Unknown: 

But will it be before you go with the final rule. In other words, will the public or 

stakeholders have an opportunity to comment on it independently of the final rule going to 

OMB? 

Barry Berlin: 

56 

Any questions on this part. 

Unknown: 

Barry does this mean that the department has concluded that this is a significant regulatory 

action and requires regulatory impact analysis. 

Barry Berlin: 

Well ifwe estimate the effect on the economy will be an annual effect of one hundred 

million dollars then we would conduct the regulatory impact analysis that is required by 

the executive order. 

Unknown: 

Has the department decided that changing ballast standards would have a one million 

dollar impact on the economy? 

Barry Berlin: 

We don't know where the standards would come out so we haven't derived that. In the 

past all the rule making has been in excess of whatever the figure was and when we have 

gone to OMB (not audible) of an impact analysis. 

Unknown: 

And when you go to OMB before the gain, before the (not audible) or only before final 

rule. 

Barry Berlin: 

They wouldn't want to, it will be after the number they don't want to see anything until it 

is proposed. 

Unknown: 

But will it be before you go with the final rule. In other words, will the public or 

stakeholders have an opportunity to comment on it independently of the final rule going to 

OMB? 

Barry Berlin: 

56 
Well the regulatory impact analysis will be printed in the technical support document that

accompanies the proposal.

Unknown:

Oh it would be? I didn't realize that.

Eugene Margolis:

We came out last fall with room air conditions and we had said that based on the old

product rule making it would be above one hundred million. In effect it was under that so

there has been a (not audible) which we came out with the final rule which has been under

that number.

Bob Wisbey:

I just have a real brief comment. The study of the alternatives of regulatory action. As

Mike (not audible) this morning earlier, we are in the midst a fundamental market

transformation in this product area and I think the important thing to look at is what the

results are in terms of what happens in the market transformation in magnetic and

electronic and not spend nearly so much time trying to worry about why those things are

happening or did they happen because of this program or did they happen because of that

program or some other program but the fact is they are happening and they are happening

for a real mixture of these reasons and being able to attribute the cause of why they

happen to individual programs is irrelevant and unimportant. What is relevant and

important is the speed at which the transformation takes place.

Barry Berlin:

Well that is true but the importance of analyzing for example the mass government

purchase is what effect that would have to have on how much is going on for current

government purchases simply to make that calculation. But that is all it would be used

for. Thank you.

Mark Perlis:

57

EE-RM-97-500 COMMENT 21OO

Well the regulatory impact analysis will be printed in the technical support document that 

accompanies the proposal. 

Unknown: 

Oh it would be? I didn't realize that. 

Eugene Margolis: 

We came out last fall with room air conditions and we had said that based on the old 

product rule making it would be above one hundred million. In effect it was under that so 

there has been a (not audible) which we came out with the:final rule which has been under 

that number. 

Bob Wisbey: 

I just have a real brief comment. The study of the alternatives of regulatory action. As 

Mike (not audible) this morning earlier, we are in the midst a fundamental market 

transformation in this product area and I think the important thing to look at is what the 

results are in terms of what happens in the market transformation in magnetic and 

electronic and not spend nearly so much time trying to worry about why those things are 

happening or did they happen because of this program or did they happen because of that 

program or some other program but the fact is they are happening and they are happening 

for a real mixture of these reasons and being able to attribute the cause of why they 

happen to individual programs is irrelevant and unimportant. What is relevant and 

important is the speed at which the transformation takes place. 

Barry Berlin: 

Well that is true but the importance of analyzing for example the mass government 

purchase is what effect that would have to have on how much is going on for current 

government purchases simply to make that calculation. But that is all it would be used 

for. Thank you. 

Mark Perlis: 

57 

Well the regulatory impact analysis will be printed in the technical support document that 

accompanies the proposal. 

Unknown: 

Oh it would be? I didn't realize that. 

Eugene Margolis: 

We came out last fall with room air conditions and we had said that based on the old 

product rule making it would be above one hundred million. In effect it was under that so 

there has been a (not audible) which we came out with the:final rule which has been under 

that number. 

Bob Wisbey: 

I just have a real brief comment. The study of the alternatives of regulatory action. As 

Mike (not audible) this morning earlier, we are in the midst a fundamental market 

transformation in this product area and I think the important thing to look at is what the 

results are in terms of what happens in the market transformation in magnetic and 

electronic and not spend nearly so much time trying to worry about why those things are 

happening or did they happen because of this program or did they happen because of that 

program or some other program but the fact is they are happening and they are happening 

for a real mixture of these reasons and being able to attribute the cause of why they 

happen to individual programs is irrelevant and unimportant. What is relevant and 

important is the speed at which the transformation takes place. 

Barry Berlin: 

Well that is true but the importance of analyzing for example the mass government 

purchase is what effect that would have to have on how much is going on for current 

government purchases simply to make that calculation. But that is all it would be used 

for. Thank you. 

Mark Perlis: 

57 
One other question Barry and because of the list of alternatives I find that the notions and

study of consumer tax credits or manufactures tax credits , politically... beside the point but

in terms of the department focusing on things that might be more realistic such as the

departments and support. The lighting industry has long suggested that energy efficiency

standards might be re-evaluated on a systems basis rather than on an individual component

basis and I guess if you are going to go to all the trouble of estimating impact from

different types of programs that could (not audible) energy efficiency at least from the

lighting context perhaps you should be considering systems (not audible) of lighting rather

than individual components approach even as an alternative.

Barry Berlin:

These are all alternatives to the regulation that is being proposed.

Mark Perlis:

Exactly how are you going to compare all these alternatives to standards just in terms of

net costs to the economy?

Barry Berlin:

Well mostly in terms of energy savings because that is what we used in the past and net

present value according to the spreadsheet. Those in the metrics we have reported in the

past under regulatory impact.

Unknown:

Additional questions or comments on Barry's presentation. So these are the alternatives

that would be considered?

Barry Berlin:

Right.

Unknown:

As you decided whether to go forward or not.

Barry Berlin:

58

EE-RM-97-500 COMMENT 21OO

One other question Barry and because of the list of alternatives I find that the notions and 

study of consumer tax credits or manufactures tax credits, politically ... beside the point but 

in terms of the department focusing on things that might be more realistic such as the 

departments and support. The lighting industry has long suggested that energy efficiency 

standards might be re-evaluated on a systems basis rather than on an individual component 

basis and I guess if you are going to go to all the trouble of estimating impact from 

different types of programs that could (not audible) energy efficiency at least from the 

lighting context perhaps you should be considering systems (not audible) of lighting rather 

than individual components approach even as an alternative. 

Barry Berlin: 

These are all alternatives to the regulation that is being proposed. 

Mark Perlis: 

Exactly how are you going to compare all these alternatives to standards just in terms of 

net costs to the economy? 

Barry Berlin: 

Well mostly in terms of energy savings because that is what we used in the past and net 

present value according to the spreadsheet. Those in the metrics we have reported in the 

past under regulatory impact. 

Unknown: 

Additional questions or comments on Barry's presentation. So these are the alternatives 

that would be considered? 

Barry Berlin: 

Right. 

Unknown: 

As you decided whether to go forward or not. 

Barry Berlin: 

58 

One other question Barry and because of the list of alternatives I find that the notions and 

study of consumer tax credits or manufactures tax credits, politically ... beside the point but 

in terms of the department focusing on things that might be more realistic such as the 

departments and support. The lighting industry has long suggested that energy efficiency 

standards might be re-evaluated on a systems basis rather than on an individual component 

basis and I guess if you are going to go to all the trouble of estimating impact from 

different types of programs that could (not audible) energy efficiency at least from the 

lighting context perhaps you should be considering systems (not audible) of lighting rather 

than individual components approach even as an alternative. 

Barry Berlin: 

These are all alternatives to the regulation that is being proposed. 

Mark Perlis: 

Exactly how are you going to compare all these alternatives to standards just in terms of 

net costs to the economy? 

Barry Berlin: 

Well mostly in terms of energy savings because that is what we used in the past and net 

present value according to the spreadsheet. Those in the metrics we have reported in the 

past under regulatory impact. 

Unknown: 

Additional questions or comments on Barry's presentation. So these are the alternatives 

that would be considered? 

Barry Berlin: 

Right. 

Unknown: 

As you decided whether to go forward or not. 

Barry Berlin: 

58 
What would make a proposal to OMB that has an annual impact on the economy of a

hundred million dollars or more OMB requires you go to the respective sides and we send

as a result this to O for their consideration . We have never had any feedback from

O M on what they do with this, if anything.

Unknown:

Back on the indirect (not audible) impacts, what kind of track is that on for completion of

(not audible)?

Barry Berlin:

Well at this point tre model is still being developed. I think it is mostly completed. I am

not (not audible) in its development but from there we will proceed in some sort of orderly

fashion. I haven't really been.

Unknown:

Would this likely be available prior to the (not audible) or.

Barry Berlin:

My self is that it is nearing completion and may be available before the seasons over but I

can't say for certain. I haven't been in touch with the developers at BNL.

Unknown:

Is it also included in the TSB (not audible)?

Barry Berlin:

We hadn't thought about it but it probably should be yes, I think that it would be. Any

numbers that would work.

Carl Adams:

My guess would be that without looking at the scheduling for this particular item is that it

should be available at this next workshop that we are currently speaking of in late October

where we would have the manufactured impact analysis and life cycle costs results that

this, the results of this would be available at that time.

Douglas Brookman:

59

EE-RM-97-500 COMMENT 21OO

What would make a proposal to OMB that has an annual impact on the economy of a 

hundred million dollars or more OMB requires you go to the respective sides and we send 

as a result this to OMB for their consideration. We have never had any feedback from 

OMB on what they do with this, if anything. 

Unknown: 

Back on the indirect (not audible) impacts, what kind of track is that on for completion of 

(not audible)? 

Barry Berlin: 

Well at this point tre model is still being developed. I think it is mostly completed. I am 

not (not audible) in its development but from there we will proceed in some sort of orderly 

fashion. I haven't really been. 

Unknown: 

Would this likely be available prior to the (not audible) or. 

Barry Berlin: 

My self is that it is nearing completion and may be available before the seasons over but I 

can't say for certain. I haven't been in touch with the developers at BNL. 

Unknown: 

Is it also included in the TSB (not audible)? 

Barry Berlin: 

We hadn't thought about it but it probably should be yes, I think that it would be. Any 

numbers that would work. 

Carl Adams: 

My guess would be that without looking at the scheduling for this particular item is that it 

should be available at this next workshop that we are currently speaking of in late October 

where we would have the manufactured impact analysis and life cycle costs results that 

this, the results of this would be available at that time. 

Douglas Brookman: 

59 

What would make a proposal to OMB that has an annual impact on the economy of a 

hundred million dollars or more OMB requires you go to the respective sides and we send 

as a result this to OMB for their consideration. We have never had any feedback from 

OMB on what they do with this, if anything. 

Unknown: 

Back on the indirect (not audible) impacts, what kind of track is that on for completion of 

(not audible)? 

Barry Berlin: 

Well at this point tre model is still being developed. I think it is mostly completed. I am 

not (not audible) in its development but from there we will proceed in some sort of orderly 

fashion. I haven't really been. 

Unknown: 

Would this likely be available prior to the (not audible) or. 

Barry Berlin: 

My self is that it is nearing completion and may be available before the seasons over but I 

can't say for certain. I haven't been in touch with the developers at BNL. 

Unknown: 

Is it also included in the TSB (not audible)? 

Barry Berlin: 

We hadn't thought about it but it probably should be yes, I think that it would be. Any 

numbers that would work. 

Carl Adams: 

My guess would be that without looking at the scheduling for this particular item is that it 

should be available at this next workshop that we are currently speaking of in late October 

where we would have the manufactured impact analysis and life cycle costs results that 

this, the results of this would be available at that time. 

Douglas Brookman: 

59 
This is the best place to have the kind of exchange that produces more light than heat, if

you wish. Just to use a metaphor. So that is what we hope to do in this workshop

environment and there are other venue for you to do produce a record. Okay. So having

said that then let me turn to Carl and Carl is going to lead off talking about manufacturer

impact analysis methodology.

Carl Adams:

I am Carl Adams, with the office of Codes and Standards at DoE and the new team leader

for the florescent lamp ballast (not audible). This next section of our workshop is in

regard to the Department's legislative requirement to determine the economic impact of

standards on manufacturers. There are two mentions of this. One is that in determining

whether economically justified DoE is required to consider the economic impact on

manufacturers as well as consumers and the impact of any lessening of competition is

determined by the attorney general. In search of a better way to complete this task the

Department committed to a detailed review of the manufacturing impact analysis

methodologies in the July 1996 Process Improvement Rule. This articulated principal for

generic analysis framework the Department will do the following: provide for early

stakeholder input, utilize an annual cash flow approach to determine quantitative impact,

develop estimates of critical variables drawing on multiple sources both quantitative and

qualitative. Report the distribution of impact on manufacturers. Use models that easy to

understand and account for uncertainty. Consider the cumulative impact of regulation and

the impact on manufacturing capacity, plant closures and loss of capital investment. These

principals were expanded to the manufacturing impact analysis workshop held in March of

1997. Today's presentation will discuss this analytical framework has been applied to the

ballast industry. Crucial to our effort were the manufacturer site visits and interviews

which Department staff members conducted in late 96 and early 97. These helped to

shape the conclusion that the Department should go further than only considering a pro

typical firm against which manufacturing impacts could be measured. The new

60

EE-RM-97-500 COMMENT 21OO

This is the best place to have the kind of exchange that produces more light than heat, if 

you wish. Just to use a metaphor. So that is what we hope to do in this workshop 

environment and there are other venue for you to do produce a record. Okay. So having 

said that then let me turn to Carl and Carl is going to lead off talking about manufacturer 

impact analysis methodology. 

Carl Adams: 

I am Carl Adams, with the office of Codes and Standards at DoE and the new team leader 

for the florescent lamp ballast (not audible). This next section of our workshop is in 

regard to the Department's legislative requirement to determine the economic impact of 

standards on manufacturers. There are two mentions of this. One is that in determining 

whether economically justified DoE is required to consider the economic impact on 

manufacturers as well as consumers and the impact of any lessening of competition is 

determined by the attorney general. In search of a better way to complete this task the 

Department committed to a detailed review of the manufacturing impact analysis 

methodologies in the July 1996 Process Improvement Rule. This articulated principal for 

generic analysis framework the Department will do the following: provide for early 

stakeholder input, utilize an annual cash flow approach to determine quantitative impact, 

develop estimates of critical variables drawing on multiple sources both quantitative and 

qualitative. Report the distribution of impact on manufacturers. Use models that easy to 

understand and account for uncertainty. Consider the cumulative impact of regulation and 

the impact on manufacturing capacity, plant closures and loss of capital investment. These 

principals were expanded to the manufacturing impact analysis workshop held in March of 

1997. Today's presentation will discuss this analytical framework has been applied to the 

ballast industry. Crucial to our effort were the manufacturer site visits and interviews 

which Department staff members conducted in late 96 and early 97. These helped to 

shape the conclusion that the Department should go further than only considering a pro 

typical firm against which manufacturing impacts could be measured. The new 

60 

This is the best place to have the kind of exchange that produces more light than heat, if 

you wish. Just to use a metaphor. So that is what we hope to do in this workshop 

environment and there are other venue for you to do produce a record. Okay. So having 

said that then let me turn to Carl and Carl is going to lead off talking about manufacturer 

impact analysis methodology. 

Carl Adams: 

I am Carl Adams, with the office of Codes and Standards at DoE and the new team leader 

for the florescent lamp ballast (not audible). This next section of our workshop is in 

regard to the Department's legislative requirement to determine the economic impact of 

standards on manufacturers. There are two mentions of this. One is that in determining 

whether economically justified DoE is required to consider the economic impact on 

manufacturers as well as consumers and the impact of any lessening of competition is 

determined by the attorney general. In search of a better way to complete this task the 

Department committed to a detailed review of the manufacturing impact analysis 

methodologies in the July 1996 Process Improvement Rule. This articulated principal for 

generic analysis framework the Department will do the following: provide for early 

stakeholder input, utilize an annual cash flow approach to determine quantitative impact, 

develop estimates of critical variables drawing on multiple sources both quantitative and 

qualitative. Report the distribution of impact on manufacturers. Use models that easy to 

understand and account for uncertainty. Consider the cumulative impact of regulation and 

the impact on manufacturing capacity, plant closures and loss of capital investment. These 

principals were expanded to the manufacturing impact analysis workshop held in March of 

1997. Today's presentation will discuss this analytical framework has been applied to the 

ballast industry. Crucial to our effort were the manufacturer site visits and interviews 

which Department staff members conducted in late 96 and early 97. These helped to 

shape the conclusion that the Department should go further than only considering a pro 

typical firm against which manufacturing impacts could be measured. The new 

60 
manufacturing impact discussed in the framework expanded the scope of impact

considered and the range of firms analyzed. As described in the process rule the

Department will try to understand and consider how standards impact different categories

of manufacturers. You can see from this slide from the generic framework that we talk in

terms of having a couple of sub-groups, be they large, small, whatever but in the case of

ballast it was determined from the visits that they sub-groups should actually be the

individual manufacturers themselves. Additionally what we used to do is go to a

prototypical firm but also just looked at financial impacts and now we are going to include

employment impacts, competitive impacts and capacity impacts as well. The hope is that

this analytical approach will produce a much more comprehensive picture and enable the

Department to reach accurate and well supported conclusions. I would now like to

introduce Mike Rivest of Arthur D. Little who is conducting this analysis under the

direction of DoE who will discuss in greater detail how the new methodology will work

with respect to florescent lamp ballast. Mike.

Michael Rivest:

Good afternoon. I would just like to quickly review the agenda with you. In this first

session the first half an hour I would just like to bring everyone back to March of last year

and go over the generic methodology that we developed together and I would like to

point out that ballast manufacturers particularly have a great role in shaping the outcome

of that generic methodology because a lot of the issues that came out the sub group

analysis for example and the employment and capacity impact really reflect a lot of the

concerns that were given to DoE during the last duration of analysis. So I think that as we

look forward to tailoring this to ballast there is already a lot of ballast that underline the

generic methodology. Once I have described the general approach also showing the

interaction between the manufacturing impact analysis and the other analysis section that

Mike talked about this morning I would like to get into a more nuts and bolts discussion

on the quantitative impacts and the approach we are proposing to try and quantify the

61

EE-RM-97-500 COMMENT 21OO

manufacturing impact discussed in the framework expanded the scope of impact 

considered and the range of:firms analyzed. As described in the process rule the 

Department will try to understand and consider how standards impact different categories 

of manufacturers. You can see from this slide from the generic framework that we talk in 

terms of having a couple of sub-groups, be they large, small, whatever but in the case of 

ballast it was determined from the visits that they sub-groups should actually be the 

individual manufacturers themselves. Additionally what we used to do is go to a 

prototypical firm but also just looked at financial impacts and now we are going to include 

employment impacts, competitive impacts and capacity impacts as well. The hope is that 

this analytical approach will produce a much more comprehensive picture and enable the 

Department to reach accurate and well supported conclusions. I would now like to 

introduce Mike Rivest of Arthur D. Little who is conducting this analysis under the 

direction of DoE who will discuss in greater detail how the new methodology will work 

with respect to florescent lamp ballast. Mike. 

Michael Rivest: 

Good afternoon~ I would just like to quickly review the agenda with you. In this first 

session the first half an hour I would just like to bring everyone back to March of last year 

and go over the generic methodology that we developed together and I would like to 

point out that ballast manufacturers particularly have a great role in shaping the outcome 

of that generic methodology because a lot of the issues that came out the sub group 

analysis for example and the employment and capacity impact really reflect a lot of the 

concerns that were given to DoE during the last duration of analysis. So I think that as we 

look forward to tailoring this to ballast there is already a lot of ballast that underline the 

generic methodology. Once I have described the general approach also showing the 

interaction between the manufacturing impact analysis and the other analysis section that 

Mike talked about this morning I would like to get into a more nuts and bolts discussion 

on the quantitative impacts and the approach we are proposing to try and quantify the 

61 

manufacturing impact discussed in the framework expanded the scope of impact 

considered and the range of:firms analyzed. As described in the process rule the 

Department will try to understand and consider how standards impact different categories 

of manufacturers. You can see from this slide from the generic framework that we talk in 

terms of having a couple of sub-groups, be they large, small, whatever but in the case of 

ballast it was determined from the visits that they sub-groups should actually be the 

individual manufacturers themselves. Additionally what we used to do is go to a 

prototypical firm but also just looked at financial impacts and now we are going to include 

employment impacts, competitive impacts and capacity impacts as well. The hope is that 

this analytical approach will produce a much more comprehensive picture and enable the 

Department to reach accurate and well supported conclusions. I would now like to 

introduce Mike Rivest of Arthur D. Little who is conducting this analysis under the 

direction of DoE who will discuss in greater detail how the new methodology will work 

with respect to florescent lamp ballast. Mike. 

Michael Rivest: 

Good afternoon~ I would just like to quickly review the agenda with you. In this first 

session the first half an hour I would just like to bring everyone back to March of last year 

and go over the generic methodology that we developed together and I would like to 

point out that ballast manufacturers particularly have a great role in shaping the outcome 

of that generic methodology because a lot of the issues that came out the sub group 

analysis for example and the employment and capacity impact really reflect a lot of the 

concerns that were given to DoE during the last duration of analysis. So I think that as we 

look forward to tailoring this to ballast there is already a lot of ballast that underline the 

generic methodology. Once I have described the general approach also showing the 

interaction between the manufacturing impact analysis and the other analysis section that 

Mike talked about this morning I would like to get into a more nuts and bolts discussion 

on the quantitative impacts and the approach we are proposing to try and quantify the 

61 
impacts between positive and negative in terms of the dollar value. After the break I

would like to actually show you my current in development version of the GRIM model

which will be linked to the net spreadsheet that we showed this morning. I've got a limit

of net I and you are up to net 3 so I've got a little work to do. It is work in progress but I

think there is enough there to show you the direction we are taking and it is also early

enough that we can shape that direction. We might be able to bring in some of your input

immediately. I envision that the spreadsheet itself would be complete within the next six

weeks or so, so after the comments here and maybe some phone calls, etc. I hope to have

the spreadsheet finished. In the final section I asked Quentin Looney who works with us

to describe a little bit the process we intend to use for our second major tool which is a

survey instrument, a survey guide as you will. It is not really a survey it is more really an

interview questionnaire. It is a series of (not audible) points that has a purpose first of all

to discuss a cashflow analysis assumption that we were making but also to try and get a

handle on some of the other impacts which are important and are not necessarily the

outcome of the tax flow analysis. I am very happy to note there are suppliers for the

ballast industry here and although neither of those tools has been tailored to supplier

industries we will see that consideration of their impact (not audible) as we go through the

analysis. I will complete by looking at schedules for the actual conduct of the analysis.

Mike Perlis:

(Not audible) a half an hour.

Michael Rivest:

Right we will break just after the generic methodology. I was just overviewing the

presentation. It just quickly talks about the generic framework and some of the phases in

the analysis. The first phase which will be ballast industry profile, you realize that the

generic methodology was being developed in amidst of the ballast rule so the essential step

which is profiling the industry was in fact conducted a little later than the ballast (not

audible) since we were already on to the analysis but the interviews that were held were

62

EE-RM-97-500 COMMENT 21OO

impacts between positive and negative in terms of the dollar value. After the break I 

would like to actually show you my current in development version of the GRIM model 

which will be linked to the net spreadsheet that we showed this morning. I've got a limit 

of net 1 and you are up to net 3 so I've got a little work to do. It is work in progress but I 

think there is enough there to show you the direction we are taking and it is also early 

enough that we can shape that direction. We might be able to bring in some of your input 

immediately. I envision that the spreadsheet itself would be complete within the next six 

weeks or so, so after the comments here and maybe some phone calls, etc. I hope to have 

the spreadsheet finished. In the final section I asked Quentin Looney who works with us 

to describe a little bit the process we intend to use for our second major tool which is a 

survey instrument, a survey guide as you will. It is not really a survey it is more really an 

interview questionnaire. It is a series of (not audible) points that has a purpose first of all 

to discuss a cashflow analysis assumption that we were making but also to try and get a 

handle on some of the other impacts which are important and are not necessarily the 

outcome of the tax flow analysis. I am very happy to note there are suppliers for the 

ballast industry here and although neither ofthose tools has been tailored to supplier 

industries we will see that consideration of their impact (not audible) as we go through the 

analysis. I will complete by looking at schedules for the actual conduct of the analysis. 

Mike Perlis: 

(Not audible) a half an hour. 

Michael Rivest: 

Right we will break just after the generic methodology. I was just overviewing the 

presentation. It just quickly talks about the generic framework and some of the phases in 

the analysis. The first phase which will be ballast industry profile, you realize that the 

generic methodology was being developed in amidst of the ballast rule so the essential step 

which is profiling the industry was in fact conducted a little later than the ballast (not 

audible) since we were already on to the analysis but the interviews that were held were 

62 

impacts between positive and negative in terms of the dollar value. After the break I 

would like to actually show you my current in development version of the GRIM model 

which will be linked to the net spreadsheet that we showed this morning. I've got a limit 

of net 1 and you are up to net 3 so I've got a little work to do. It is work in progress but I 

think there is enough there to show you the direction we are taking and it is also early 

enough that we can shape that direction. We might be able to bring in some of your input 

immediately. I envision that the spreadsheet itself would be complete within the next six 

weeks or so, so after the comments here and maybe some phone calls, etc. I hope to have 

the spreadsheet finished. In the final section I asked Quentin Looney who works with us 

to describe a little bit the process we intend to use for our second major tool which is a 

survey instrument, a survey guide as you will. It is not really a survey it is more really an 

interview questionnaire. It is a series of (not audible) points that has a purpose first of all 

to discuss a cashflow analysis assumption that we were making but also to try and get a 

handle on some of the other impacts which are important and are not necessarily the 

outcome of the tax flow analysis. I am very happy to note there are suppliers for the 

ballast industry here and although neither ofthose tools has been tailored to supplier 

industries we will see that consideration of their impact (not audible) as we go through the 

analysis. I will complete by looking at schedules for the actual conduct of the analysis. 

Mike Perlis: 

(Not audible) a half an hour. 

Michael Rivest: 

Right we will break just after the generic methodology. I was just overviewing the 

presentation. It just quickly talks about the generic framework and some of the phases in 

the analysis. The first phase which will be ballast industry profile, you realize that the 

generic methodology was being developed in amidst of the ballast rule so the essential step 

which is profiling the industry was in fact conducted a little later than the ballast (not 

audible) since we were already on to the analysis but the interviews that were held were 

62 
instrumental to that. Talking about the strong end industry cashflow that we are putting

together to get some feedback and to be a touch stone then we will talk about how we

might aggregate following interviews with manufacturers that we might go back and

integrate them into a definitive industry cashflow. As Carl mentioned the commitments of

the interpretive rule were to take this away at least from some degree from the

quantitative focus of the task which in essence the manufactured impact analysis was the

running of the model and providing input into a model and now we have added a large

qualitative assessment component to the analysis and our main instrument for conducting

this analysis are manufacturer and stakeholder interviews and we intend to be frequently

consulting with any interested party in the rule. The analytical rule that I touched on it a

littler earlier is the government regulatory impact model. This spreadsheet works in itself

that was I believe its development was commissioned by the three trade associations and

was adopted by DoE last year when they developed the generic methodology. Recapping

there is really three phases to the analysis. There is the development of the profile and the

definition of the issues. We've got carrying out of an industry cashflow analysis and we

have the industry stagmentation and subgroup analysis to try and understand the individual

impacts on various subgroups. This is also part of the generic framework of typical rule

making. Just showing you how the three phases of the manufactured impact are related to

the overall analysis in rule making. The engineering analysis normally would provide a lot

of the cost input data of the manufacturing costs of various types of ballast's and various

efficiency levels. Some of the price forecasts are incorporated into the life cycle cost

analysis. The national benefits analysis, the spreadsheet we saw this morning. The net

spreadsheet contains a lot of the forecasts for shipment and what the GRIM industry

cashflow does is that it incorporates the prices, the quantities, the costs along with some

other financial information to create an industry cashflow. The second component of the

analysis, which involves individual visits with manufacturers, consists also of the cashflow

when we try and understand the variances between the cashflows of the individual

63

EE-RM-97-500 COMMENT 21OO

instrumental to that. Talking about the strong end industry cashflow that we are putting 

together to get some feedback and to be a touch stone then we will talk about how we 

might aggregate following interviews with manufacturers that we might go back and 

integrate them into a definitive industry cashflow. As Carl mentioned the commitments of 

the interpretive rule were to take this away at least from some degree from the 

quantitative focus of the task which in essence the manufactured impact analysis was the 

running ofthe model and providing input into a model and now we have added a large 

qualitative assessment component to the analysis and our main instrument for conducting 

this analysis are manufacturer and stakeholder interviews and we intend to be frequently 

consulting with any interested party in the rule. The analytical rule that I touched on it a 

littler earlier is the government regulatory impact model. This spreadsheet works in itself 

that was I believe its development was commissioned by the three trade associations and 

was adopted by DoE last year when they developed the generic methodology. Recapping 

there is really three phases to the analysis. There is the development of the profile and the 

definition of the issues. We've got carrying out ofan industry cashflow analysis and we 

have the industry stagmentation and subgroup analysis to try and understand the individual 

impacts on various subgroups. This is also part of the generic framework of typical rule 

making. Just showing you how the three phases of the manufactured impact are related to 

the overall analysis in rule making. The engineering analysis normally would provide a lot 

ofthe cost input data of the manufacturing costs of various types of ballast's and various 

efficiency levels. Some of the price forecasts are incorporated into the life cycle cost 

analysis. The national benefits analysis, the spreadsheet we saw this morning. The net 

spreadsheet contains a lot of the forecasts for shipment and what the GRIM industry 

cashflow does is that it incorporates the prices, the quantities, the costs along with some 

other financial information to create an industry cashflow. The second component of the 

analysis, which involves individual visits with manufacturers, consists also ofthe cashflow 

when we try and understand the variances between the cashflows of the individual 

63 

instrumental to that. Talking about the strong end industry cashflow that we are putting 

together to get some feedback and to be a touch stone then we will talk about how we 

might aggregate following interviews with manufacturers that we might go back and 

integrate them into a definitive industry cashflow. As Carl mentioned the commitments of 

the interpretive rule were to take this away at least from some degree from the 

quantitative focus of the task which in essence the manufactured impact analysis was the 

running ofthe model and providing input into a model and now we have added a large 

qualitative assessment component to the analysis and our main instrument for conducting 

this analysis are manufacturer and stakeholder interviews and we intend to be frequently 

consulting with any interested party in the rule. The analytical rule that I touched on it a 

littler earlier is the government regulatory impact model. This spreadsheet works in itself 

that was I believe its development was commissioned by the three trade associations and 

was adopted by DoE last year when they developed the generic methodology. Recapping 

there is really three phases to the analysis. There is the development of the profile and the 

definition of the issues. We've got carrying out ofan industry cashflow analysis and we 

have the industry stagmentation and subgroup analysis to try and understand the individual 

impacts on various subgroups. This is also part of the generic framework of typical rule 

making. Just showing you how the three phases of the manufactured impact are related to 

the overall analysis in rule making. The engineering analysis normally would provide a lot 

ofthe cost input data of the manufacturing costs of various types of ballast's and various 

efficiency levels. Some of the price forecasts are incorporated into the life cycle cost 

analysis. The national benefits analysis, the spreadsheet we saw this morning. The net 

spreadsheet contains a lot of the forecasts for shipment and what the GRIM industry 

cashflow does is that it incorporates the prices, the quantities, the costs along with some 

other financial information to create an industry cashflow. The second component of the 

analysis, which involves individual visits with manufacturers, consists also ofthe cashflow 

when we try and understand the variances between the cashflows of the individual 

63 
manufacturers and the what we call the industry cashflow situation. And also to try and

get an understanding of the other impacts which are part of the process rule. Actually

impacts on the competition of (not audible) but the impacts on employment and on

manufacturing capacity. This would be a good time to stop. My other slides actually get

into tailoring of the generic methodology throughout the ballast rule. This might be a

good time to break.

Mark Perlis:

I would like to pose a question before we move on to brief comments from industry

representatives. The first

Mark Perlis:

The first thing Mike that you refer to the ballast industry profile and it had to do with or

simultaneously for ballast (not audible). Is it the chart at page 12 in the handout here

basically the profile?

Michael Rivest:

No. No. No that was just an illustrative industry statistic type slide. What I mean by

industry profile, when the analysis was set up and manufacturing impacts were calculated I

guess in'94 they said these are the industry shipments. So many magnetic ballast, so many

electronic ballast, there are four or five players in the industry, we are going to make up a

prototypical firm which has a 20% of the market share of magnetic and electronic and we

are going to run the numbers. What we did in the industry profile is that we visited the

manufacturers and we understood very quickly that there were people who made only

magnetic, some make only electronic, some are big, some are small and most of all we

realized that the set up of the analysis which was wrong when you are talking about

technology change from magnetic to electronic. I think in one day I did both types of

plans and I saw very little commonality until that very last step where they put it in the box

so to me the profiling is the understanding of the issues to allow us this structure and the

-analysis that makes sense.

64

EE-RM-97-500 COMMENT 21OO

manufacturers and the what we call the industry cashflow situation. And also to try and 

get an understanding of the other impacts which are part of the process rule. Actually 

impacts on the competition of (not audible) but the impacts on employment and on 

manufacturing capacity. This would be a good time to stop. My other slides actually get 

into tailoring of the generic methodology throughout the ballast rule. This might be a 

good time to break. 

Mark Perlis: 

I would like to pose a question before we move on to brief comments from industry 

representatives. The first 

Mark Perlis: 

The first thing Mike that you refer to the ballast industry profile and it had to do with or 

simultaneously for ballast (not audible). Is it the chart at page 12 in the handout here 

basically the profile? 

Michael Rivest: 

No. No. No that was just an illustrative industry statistic type slide. What I mean by 

industry profile, when the analysis was set up and manufacturing impacts were calculated I 

guess in '94 they said these are the industry shipments. So many magnetic ballast, so many 

electronic ballast, there are four or five players in the industry, we are going to make up a 

prototypical firm which has a 20% of the market share of magnetic and electronic and we 

are going to run the numbers. What we did in the industry profile is that we visited the 

manufacturers and we understood very quickly that there were people who made only 

magnetic, some make only electronic, some are big, some are small and most of all we 

realized that the set up of the analysis which was wrong when you are talking about 

technology change :from magnetic to electronic. I think: in one day I did both types of 

plans and I saw very little commonality until that very last step where they put it in the box 

so to me the profiling is the understanding of the issues to allow us this structure and the 

analysis that makes sense. 

64 

manufacturers and the what we call the industry cashflow situation. And also to try and 

get an understanding of the other impacts which are part of the process rule. Actually 

impacts on the competition of (not audible) but the impacts on employment and on 

manufacturing capacity. This would be a good time to stop. My other slides actually get 

into tailoring of the generic methodology throughout the ballast rule. This might be a 

good time to break. 

Mark Perlis: 

I would like to pose a question before we move on to brief comments from industry 

representatives. The first 

Mark Perlis: 

The first thing Mike that you refer to the ballast industry profile and it had to do with or 

simultaneously for ballast (not audible). Is it the chart at page 12 in the handout here 

basically the profile? 

Michael Rivest: 

No. No. No that was just an illustrative industry statistic type slide. What I mean by 

industry profile, when the analysis was set up and manufacturing impacts were calculated I 

guess in '94 they said these are the industry shipments. So many magnetic ballast, so many 

electronic ballast, there are four or five players in the industry, we are going to make up a 

prototypical firm which has a 20% of the market share of magnetic and electronic and we 

are going to run the numbers. What we did in the industry profile is that we visited the 

manufacturers and we understood very quickly that there were people who made only 

magnetic, some make only electronic, some are big, some are small and most of all we 

realized that the set up of the analysis which was wrong when you are talking about 

technology change :from magnetic to electronic. I think: in one day I did both types of 

plans and I saw very little commonality until that very last step where they put it in the box 

so to me the profiling is the understanding of the issues to allow us this structure and the 

analysis that makes sense. 

64 
Mark Perlis:

That is very helpful. The reason for my question is because the generic document that you

all were reading dated April 10th Ballast Manufacturing Tax Analysis (not audible) which

you inserted the box material about ballast specifics lays out a somewhat ambitious data

book that will be prepared and I wondered whether that is going to be done and at which

point that is going to be shared with the industry and how that fits in , I understand that

can't, it was supposed to have been done even before you get started on all these cashflow

analysis and even before the next round of interviews I would imagine.

Michael Rivest:

What I would say is that the context of that data book exist and the various analysis set up

to produce to date such as historical shipments information, names of manufacturers, a lot

of the issues came out of the interview summaries from last year so I didn't envision

putting together a data book, per say at this point. I think that we understand the issues

sufficiently and that would be just a mere exercise in paperwork.

Mark Perlis:

Perhaps but the generic rule that was, the generic approach that was spelled out over a

year ago in response to the process improvement rule process indicates that it will be

provided to stakeholders for review and comment and indeed in the next section (not

audible) for industry knowledge are going to be identified to provide information and

access to the viewers a characterization for a fee and you might not think it is necessary, it

is part of the generic approach here that was presented to all the affected industry and it

seems we are getting away from the reverse approach in favor of (not audible). And I

guess I was wondering why.

Michael Rivest:

Just for the reason I said. I don't think what you are asking is unreasonable, I think it can

be done. It is a matter of gathering a lot of information that is already in LB & L's

65

EE-RM-97-500 COMMENT 21OO

Mark Pedis: 

That is very helpful. The reason for my question is because the generic document that you 

all were reading dated April 10th Ballast Manufacturing Tax Analysis (not audible) which 

you inserted the box material about ballast specifics lays out a somewhat ambitious data 

book that will be prepared and I wondered whether that is going to be done and at which 

point that is going to be shared with the industry and how that fits in, I understand that 

can't, it was supposed to have been done even before you get started on all these cashflow 

analysis and even before the next round of interviews I would imagine. 

Michael Rivest: 

What I would say is that the context of that data book exist and the various analysis set up 

to produce to date such as historical shipments information, names of manufacturers, a lot 

of the issues came out of the interview summaries from last year so I didn't envision 

putting together a data book, per say at this point. I think that we understand the issues 

sufficiently and that would be just a mere exercise in paperwork. 

Mark Pedis: 

Perhaps but the generic rule that was, the generic approach that was spelled out over a 

year ago in response to the process improvement rule process indicates that it will be 

provided to stakeholders for review and comment and indeed in the next section (not 

audible) for industry knowledge are going to be identified to provide information and 

access to the viewers a characterization for a fee and you might not think it is necessary, it 

is part of the generic approach here that was presented to all the affected industry and it 

seems we are getting away from the reverse approach in favor of (not audible). And I 

guess I was wondering why. 

Michael Rivest: 

Just for the reason I said. I don't think what you are asking is unreasonable, I think it cml 

be done. It is a matter of gathering a lot of information that is already in LB & L's 

65 

Mark Pedis: 

That is very helpful. The reason for my question is because the generic document that you 

all were reading dated April 10th Ballast Manufacturing Tax Analysis (not audible) which 

you inserted the box material about ballast specifics lays out a somewhat ambitious data 

book that will be prepared and I wondered whether that is going to be done and at which 

point that is going to be shared with the industry and how that fits in, I understand that 

can't, it was supposed to have been done even before you get started on all these cashflow 

analysis and even before the next round of interviews I would imagine. 

Michael Rivest: 

What I would say is that the context of that data book exist and the various analysis set up 

to produce to date such as historical shipments information, names of manufacturers, a lot 

of the issues came out of the interview summaries from last year so I didn't envision 

putting together a data book, per say at this point. I think that we understand the issues 

sufficiently and that would be just a mere exercise in paperwork. 

Mark Pedis: 

Perhaps but the generic rule that was, the generic approach that was spelled out over a 

year ago in response to the process improvement rule process indicates that it will be 

provided to stakeholders for review and comment and indeed in the next section (not 

audible) for industry knowledge are going to be identified to provide information and 

access to the viewers a characterization for a fee and you might not think it is necessary, it 

is part of the generic approach here that was presented to all the affected industry and it 

seems we are getting away from the reverse approach in favor of (not audible). And I 

guess I was wondering why. 

Michael Rivest: 

Just for the reason I said. I don't think what you are asking is unreasonable, I think it cml 

be done. It is a matter of gathering a lot of information that is already in LB & L's 

65 
documents, the interview summaries and to be put together in one central data book. I

think it is a doable task if people think that is something that would be useful.

Mark Perlis:

Well there was a process here that was implementing process improvement in the instance

of the Department and while somebody has to go first, the ballast industry has to go first, I

guess it would look a little odd if we are going to skip a bunch of steps because we have

to get the first one done and it would be redundant to (not audible) to be done otherwise.

But I think that (not audible).

Michael McCabe:

The generic approach has been discussed with other industries as well evolving the

process of other industries and specifically the cloths washer industry. They argue that it

is unnecessary, that the data being presented and discussed (not audible) and they can

revisit that issue.

Michael Rivest:

I will tell you about one issue that came up very strongly, for example with another

association. They had very serious concerns about DoE putting in one central location a

lot of industry statistics which although are all public are not all in one place so there is

some uneasiness with that that I think that if your members 'lave no problem with that or

maybe the contents of that data book would have to be brought in line with those

concerns.

Douglas Brookman:

Alright any more questions for Michael before we move on to brief comments on members

of the industry. I see none. Ok. Thanks Mike. We will pick up with you in a few

minutes. I would like to do this is somewhat of an orderly way. I was wondering if

possible to have those of which to comment literally to line up behind these two

microphones that are here. Have you talked about this, is there any order in which you

wish to present. No? Okay. Then I guess we will just go first come is first served. I'd

66

EE-RM-97-500 COMMENT 21OO

documents, the interview summaries and to be put together in one central data book. I 

think it is a doable task if people think that is something that would be useful. 

Mark Perlis: 

Well there was a process here that was implementing process improvement in the instance 

of the Department and while somebody has to go first, the ballast industry has to go first, I 

guess it would look a little odd if we are going to skip a bunch of steps because we have 

to get the first one done and it would be redundant to (not audible) to be done otherwise. 

But I think that (not audible). 

Michael McCabe: 

The generic approach has been discussed with other industries as well evolving the 

process of other industries and specifically the cloths washer industry. They argue that it 

is unnecessary, that the data being presented and discussed (not audible) and they can 

revisit that issue. 

Michael Rivest: 

I will tell you about one issue that came up very strongly, for example with another 

association. They had very serious concerns about DoE putting in one central location a 

lot of industry statistics which although are all public are not all in one place so there is 

some uneasiness with that that 1 think: that if your members have no problem with that or 

maybe the contents of that data book would have to be brought in line with those 

concerns. 

Douglas Brookman: 

Alright any more questions for Michael before we move on to brief comments on members 

of the industry. I see none. Ok. Thanks Mike. We will pick up with you in a few 

minutes. I would like to do this is somewhat of an orderly way. I was wondering if 

possible to have those of which to comment literally to line up behind these two 

microphones that are here. Have you talked about this, is there any order in which you 

wish to present. No? Okay. Then I guess we willjust go first come is first served. I'd 

66 

documents, the interview summaries and to be put together in one central data book. I 

think it is a doable task if people think that is something that would be useful. 

Mark Perlis: 

Well there was a process here that was implementing process improvement in the instance 

of the Department and while somebody has to go first, the ballast industry has to go first, I 

guess it would look a little odd if we are going to skip a bunch of steps because we have 

to get the first one done and it would be redundant to (not audible) to be done otherwise. 

But I think that (not audible). 

Michael McCabe: 

The generic approach has been discussed with other industries as well evolving the 

process of other industries and specifically the cloths washer industry. They argue that it 

is unnecessary, that the data being presented and discussed (not audible) and they can 

revisit that issue. 

Michael Rivest: 

I will tell you about one issue that came up very strongly, for example with another 

association. They had very serious concerns about DoE putting in one central location a 

lot of industry statistics which although are all public are not all in one place so there is 

some uneasiness with that that 1 think: that if your members have no problem with that or 

maybe the contents of that data book would have to be brought in line with those 

concerns. 

Douglas Brookman: 

Alright any more questions for Michael before we move on to brief comments on members 

of the industry. I see none. Ok. Thanks Mike. We will pick up with you in a few 

minutes. I would like to do this is somewhat of an orderly way. I was wondering if 

possible to have those of which to comment literally to line up behind these two 

microphones that are here. Have you talked about this, is there any order in which you 

wish to present. No? Okay. Then I guess we willjust go first come is first served. I'd 

66 
like to ask those who wish to speak on behalf of their industry and I would like if all

possible please of course state your name and who you represent. If you can characterize

your comments rather than read them off the page that would be helpful. Yes, Gene has a

question to ask.

Gene Foley:

Are we to comment or ask questions after they make their full statements, or how do you

want us to deal with that?

Douglas Brookman:

I guess let's try and have questions after each person presents but on noting that we have

pretty significant time constraints here.

Gene Foley:

Given the whole point of this whole thing was an exchange of information just having

them just throw it all out doesn't seem to be quite in line with what the point of the

meeting was.

Douglas Brookman:

Lets try it that way and see how it goes and if it is taking to long for us to get to the

primary purpose of our meeting today which is the agenda then we will have to adjust our

strategies. Yes, Michael.

Michael McCabe:

We have what sounds like a number of industry representatives from each industry who

were sent to right now identify industries and then just take it in blocks so as not to jump

from lamps to copper suppliers to other industries. We will focus in one area and then

move around like that.

Douglas Brookman:

How about that, it sounds like a good idea to me. How many different industries do we

have? Michael mentioned lamps, copper suppliers, are there other suppliers?

Speakers:

67

EE-RM-97-500 COMMENT 21OO

like to ask those who wish to speak on behalf of their industry and I would like if all 

possible please of course state your name and who you represent. If you can characterize 

your comments rather than read them off the page that would be helpful. Yes, Gene has a 

question to ask. 

Gene Foley: 

Are we to comment or ask questions after they make their full statements, or how do you 

want us to deal with that? 

Douglas Brookman: 

I guess let's try and have questions after each person presents but on noting that we have 

pretty significant time constraints here. 

Gene Foley: 

Given the whole point of this whole thing was an exchange of information just having 

themjust throw it all out doesn't seem to be quite in line with what the point of the 

meeting was. 

Douglas Brookman: 

Lets try it that way and see how it goes and if it is taking to long for us to get to the 

primary purpose of our meeting today which is the agenda then we will have to adjust our 

strategies. Yes, I'vficr..ael. 

I'vfichael McCabe: 

We have what sounds like a number of industry representatives from each industry who 

were sent to right now identify industries and then just take it in blocks so as not to jump 

from lamps to copper suppliers to other industries. We will focus in one area and then 

move around like that. 

Douglas Brookman: 

How about that, it sounds like a good idea to me. How many different industries do we 

have? I'vfichael mentioned lamps, copper suppliers, are there other suppliers? 

Speakers: 

67 

like to ask those who wish to speak on behalf of their industry and I would like if all 

possible please of course state your name and who you represent. If you can characterize 

your comments rather than read them off the page that would be helpful. Yes, Gene has a 

question to ask. 

Gene Foley: 

Are we to comment or ask questions after they make their full statements, or how do you 

want us to deal with that? 

Douglas Brookman: 

I guess let's try and have questions after each person presents but on noting that we have 

pretty significant time constraints here. 

Gene Foley: 

Given the whole point of this whole thing was an exchange of information just having 

themjust throw it all out doesn't seem to be quite in line with what the point of the 

meeting was. 

Douglas Brookman: 

Lets try it that way and see how it goes and if it is taking to long for us to get to the 

primary purpose of our meeting today which is the agenda then we will have to adjust our 

strategies. Yes, I'vficr..ael. 

I'vfichael McCabe: 

We have what sounds like a number of industry representatives from each industry who 

were sent to right now identify industries and then just take it in blocks so as not to jump 

from lamps to copper suppliers to other industries. We will focus in one area and then 

move around like that. 

Douglas Brookman: 

How about that, it sounds like a good idea to me. How many different industries do we 

have? I'vfichael mentioned lamps, copper suppliers, are there other suppliers? 

Speakers: 

67 
Metalized film (not audible) electric. Sterile protectors. Electrical coating. Capacitors.

Douglas Brookman:

So lets do this and steel. Lets honor the clue that exist and anybody who in that same

industry would speak following the, for example started to with coatings or steel, okay.

This gentleman here, your name please.

Richard Rattray:

Very brief, I am from OSRAM Sylvania as a lamp manufacturer, of course. I just wanted

to read a permitted statement but it is very quick. OSRAM Sylvania, Incorporated (OSI)

is a designer and manufacturer of both florescent lamps and electronic florescent lamp

ballast. OSI has commented previously on DoE's proposals for enhanced efficiency

standards for florescent lamp ballast's and offers the following statement pertinent to the

current state of the market for lamps and ballast. Despite the fact that OSI currently

manufactures only electronic ballast we emphasize that both electronic and magnetic

ballast technologies are required by the wide variety of applications of our lamp products.

Electronic ballast have achieved remarkable penetration of the market in recent years

which varies for covered lamp types from approximately 50% for the U.S. as a whole to

more than 80% in states where there is aggressive energy code enforcement. That upper

level of 80% penetration is good news for us as an electronic ballast manufacturer and is

probably as high as it is desirable to achieve. As a lamp manufacturer we much be

watchful of the remainder of the market. That market includes applications that are

sensitive to the interference caused by operation of lamps at high frequencies typical of

electronic ballast where an inappropriate use of replacement electronic ballast and

otherwise magnetically ballasted applications will result in inconsistent lamp performance

or outright incompatibility and where higher than acceptable life cycle costs will result

from the enforced use of electronic ballast. This will occur in all applications with low

annual running hours and the greatest impact will be in the residential market. This is or

should be a growing sector for florescent lighting. Incandescent products may be retained

68

EE-RM-97-500 COMMENT 21OO

Metalized film (not audible) electric. Sterile protectors. Electrical coating. Capacitors. 

Douglas Brookman: 

So lets do this and steel. Lets honor the clue that exist and anybody who in that same 

industry would speak following the, for example started to with coatings or steel, okay. 

This gentleman here, your name please. 

Richard Rattray: 

Very brief, I am from OSRAM Sylvania as a lamp manufacturer, of course. I just wanted 

to read a permitted statement but it is very quick. OSRAM Sylvania, Incorporated (OSI) 

is a designer and manufacturer of both florescent lamps and electronic florescent lamp 

ballast. OSI has commented previously on DoE's proposals for enhanced efficiency 

standards for florescent lamp ballast's and offers the following statement pertinent to the 

current state of the market for lamps and ballast. Despite the fact that OSI currently 

manufactures only electronic ballast we emphasize that both electronic and magnetic 

ballast technologies are required by the wide variety of applications of our lamp products. 

Electronic ballast have achieved remarkable penetration of the market in recent years 

which varies for covered lamp types from approximately 50% for the U.S. as a whole to 

more than 80% in states where there is aggressive energy code enforcement. That upper 

level of 80% penetration is good news for us as an electronic ballast manufacturer and is 

probably as high as it is desirable to achieve. As a lamp manufacturer we much be 

watchful of the remainder of the market. That market includes applications that are 

sensitive to the interference caused by operation of lamps at high frequencies typical of 

electronic ballast where an inappropriate use of replacement electronic ballast and 

otherwise magnetically ballasted applications will result in inconsistent lamp performance 

or outright incompatibility and where higher than acceptable life cycle costs will result 

from the enforced use of electronic ballast. This will occur in all applications with low 

annual running hours and the greatest impact will be in the residential market. This is or 

should be a growing sector for florescent lighting. Incandescent products may be retained 

68 

Metalized film (not audible) electric. Sterile protectors. Electrical coating. Capacitors. 

Douglas Brookman: 

So lets do this and steel. Lets honor the clue that exist and anybody who in that same 

industry would speak following the, for example started to with coatings or steel, okay. 

This gentleman here, your name please. 

Richard Rattray: 

Very brief, I am from OSRAM Sylvania as a lamp manufacturer, of course. I just wanted 

to read a permitted statement but it is very quick. OSRAM Sylvania, Incorporated (OSI) 

is a designer and manufacturer of both florescent lamps and electronic florescent lamp 

ballast. OSI has commented previously on DoE's proposals for enhanced efficiency 

standards for florescent lamp ballast's and offers the following statement pertinent to the 

current state of the market for lamps and ballast. Despite the fact that OSI currently 

manufactures only electronic ballast we emphasize that both electronic and magnetic 

ballast technologies are required by the wide variety of applications of our lamp products. 

Electronic ballast have achieved remarkable penetration of the market in recent years 

which varies for covered lamp types from approximately 50% for the U.S. as a whole to 

more than 80% in states where there is aggressive energy code enforcement. That upper 

level of 80% penetration is good news for us as an electronic ballast manufacturer and is 

probably as high as it is desirable to achieve. As a lamp manufacturer we much be 

watchful of the remainder of the market. That market includes applications that are 

sensitive to the interference caused by operation of lamps at high frequencies typical of 

electronic ballast where an inappropriate use of replacement electronic ballast and 

otherwise magnetically ballasted applications will result in inconsistent lamp performance 

or outright incompatibility and where higher than acceptable life cycle costs will result 

from the enforced use of electronic ballast. This will occur in all applications with low 

annual running hours and the greatest impact will be in the residential market. This is or 

should be a growing sector for florescent lighting. Incandescent products may be retained 

68 
if florescent are inappropriately priced. We also caution DoE not to even think of

efficiency standards based on electronic ballast criteria with exemptions for magnetic. We

have only to remind DoE of the agony caused by the BR Reflector Lamp Exemptions

contained in the 1992 Energy Policy Act to illustrate the inevitable outcome of a rule

making based on a similar premise. If the normal market forces continue their previous

trend inappropriate megs of TA florescent lamp and electronic ballast (not audible) prior

T12 lamps and energy efficient magnetic ballast will find its own level without government

intervention. The transition will also proceed at an orderly pace that the lamp and ballast

industries and their component suppliers can accommodate.

Douglas Brookman:

Thank you and that was about three minutes. If the rest of you can do as well or better

than that we will be in good shape. Okay, questions. Brief questions. Go ahead.

Gene Foley:

Gene Foley, Alliance to Save Energy. Are not residential ballast currently exempted from

the regulation and is it not the intention here to maintain that exemption so that residential

doesn't factor into any of the government classes:

Michael McCabe:

There is an exemption for residential ballasts.

Douglas Brookman:

We are thinking that we should hear from all the light manufacturers before we ask any

questions. Any other lamp manufacturers that wish to comment at this point. Is this okay

with everybody. Yes.

Ed Yandek:

My name is Ed Yandek from G.E. Lighting. I would just in the interest of time like to say

that from another major lamp manufacturers point of view we have some of the same

concerns expressed by my colleague from Sylvania. Thank you.

Douglas Brookman:

69

EE-RM-97-500 COMMENT 21OO

ifflorescent are inappropriately priced. We also caution DoE not to even think of 

efficiency standards based on electronic ballast criteria with exemptions for magnetic. We 

have only to remind DoE of the agony caused by the BR Reflector Lamp Exemptions 

contained in the 1992 Energy Policy Act to illustrate the inevitable outcome of a rule 

making based on a similar premise. If the normal market forces continue their previous 

trend inappropriate megs ofTA florescent lamp and electronic ballast (not audible) prior 

T12lamps and energy efficient magnetic ballast will find its own level without government 

intervention. The transition will also proceed at an orderly pace that the lamp and ballast 

industries and their component suppliers can accommodate. 

Douglas Brookman: 

Thank you and that was about three minutes. If the rest of you can do as well or better 

than that we will be in good shape. Okay, questions. Brief questions. Go ahead. 

Gene Foley: 

Gene Foley, Alliance to Save Energy. Are not residential ballast currently exempted from 

the regulation and is it not the intention here to maintain that exemption so that residential 

doesn't factor into any of the government classes: 

Michael McCabe: 

There is an exemptIon for residential ballasts. 

Douglas Brookman: 

We are thinking that we should hear from all the light manufacturers before we ask any 

questions. Any other lamp manufacturers that wish to comment at this point. Is this okay 

with everybody. Yes. 

Ed Yandek: 

My name is Ed Yandek from G.E. Lighting. I would just in the interest of time like to say 

that from another major lamp manufacturers point of view we have some of the same 

concerns expressed by my colleague from Sylvania. Thank you. 

Douglas Brookman: 

69 

ifflorescent are inappropriately priced. We also caution DoE not to even think of 

efficiency standards based on electronic ballast criteria with exemptions for magnetic. We 

have only to remind DoE of the agony caused by the BR Reflector Lamp Exemptions 

contained in the 1992 Energy Policy Act to illustrate the inevitable outcome of a rule 

making based on a similar premise. If the normal market forces continue their previous 

trend inappropriate megs ofTA florescent lamp and electronic ballast (not audible) prior 

T12lamps and energy efficient magnetic ballast will find its own level without government 

intervention. The transition will also proceed at an orderly pace that the lamp and ballast 

industries and their component suppliers can accommodate. 

Douglas Brookman: 

Thank you and that was about three minutes. If the rest of you can do as well or better 

than that we will be in good shape. Okay, questions. Brief questions. Go ahead. 

Gene Foley: 

Gene Foley, Alliance to Save Energy. Are not residential ballast currently exempted from 

the regulation and is it not the intention here to maintain that exemption so that residential 

doesn't factor into any of the government classes: 

Michael McCabe: 

There is an exemptIon for residential ballasts. 

Douglas Brookman: 

We are thinking that we should hear from all the light manufacturers before we ask any 

questions. Any other lamp manufacturers that wish to comment at this point. Is this okay 

with everybody. Yes. 

Ed Yandek: 

My name is Ed Yandek from G.E. Lighting. I would just in the interest of time like to say 

that from another major lamp manufacturers point of view we have some of the same 

concerns expressed by my colleague from Sylvania. Thank you. 

Douglas Brookman: 

69 
Thank you very much I appreciate you being brief Other lamp manufacturers who wish

to comment at this point. Okay, yes sir.

John Forsyth:

Yes, my name is John Forsyth, I am the North American Marketing Manager representing

Texas Instruments Lighting and Industrial Business Unit. We would like thank the United

States DoE for the opportunity to speak at this forum and participate in this workshop on

the ballast efficiency regulations and its potential impact on our business, which we believe

to substantial. Texas Instruments Materials and Controls Group which is headquartered in

Attleboro, Massachusetts is an employer of other 4,000 U. S. workers, many of which are

directly associated with the design and manufacture of film protectors which serve the

florescent ballast industry. In fact the ballast industry is by far our largest market segment

in which nearly one hundred million protectors are supplied by Texas Instruments per

year. The current proposal under consideration to revise florescent lamp ballast efficiency

regulations which potentially could include outlawing the existing magnetic ballast product

line threatens many jobs in our Massachusetts operation. It is our estimate at this time

that a minimum of 80 full time employees would be idled. This would include both hourly

and salaried employees. Besides the loss of U. S. jobs the premature obsolescence of our

product which is used in magnetic ballast would also have substantial and unforecasted

financial impact on our division. T.I. has invested greater than twenty million dollars in

capital equipment that manufactures the thermal protector used in the majority of

magnetic ballast. It is our estimate that as much of 40% of our production assets would

be idled or under utilized. Since 1987 the use of electronic ballast has grown from 2% to

nearly 40% on the market which is our estimates, we could be wrong, without government

mandates. The fact that the market penetration of electronic ballast is occurring naturally

at a high rate is strong evidence that natural market forces alone are accomplishing energy

efficiency argues against an arbitrary product band. Thank you.

Douglas Brookman:

70

EE-RM-97-500 COMMENT 21OO

Thank you very much I appreciate you being brief. Other lamp manufacturers who wish 

to comment at this point. Okay, yes sir. 

John Forsyth: 

Yes, my name is John Forsyth, I am the North American Marketing Manager representing 

Texas Instruments Lighting and Industrial Business Unit. We would like thank the United 

States DoE for the opportunity to speak at this forum and participate in this workshop on 

the ballast efficiency regulations and its potential impact on our business, which we believe 

to substantial. Texas Instruments Materials and Controls Group which is headquartered in 

Attleboro, Massachusetts is an employer of other 4,000 U.S. workers, many of which are 

directly associated with the design and manufacture of film protectors which serve the 

florescent ballast industry. In fact the ballast industry is by far our largest market segment 

in which nearly one hundred million protectors are supplied by Texas Instruments per 

year. The current proposal under consideration to revise florescent lamp ballast efficiency 

regulations which potentially could include outlawing the existing magnetic ballast product 

line threatens many jobs in our Massachusetts operation. It is our estimate at this time 

that a minimum of 80 full time employees would be idled. This would include both hourly 

and salaried employees. Besides the loss of U.S. jobs the premature obsolescence of our 

product which is used in magnetic ballast would also have substantial and unforecasted 

financial impact on our division. T.I. has invested greater than twenty million dollars in 

capital equipment that manufactures the thermal protector used in the majority of 

magnetic ballast. It is our estimate that as much of 40% of our production assets would 

be idled or under utilized. Since 1987 the use of electronic ballast has grown from 2% to 

nearly 40% on the market which is our estimates, we could be wrong, without government 

mandates. The fact that the market penetration of electronic ballast is occurring naturally 

at a high rate is strong evidence that natural market forces alone are accomplishing energy 

efficiency argues against an arbitrary product band. Thank you. 

Douglas Brookman: 

70 

Thank you very much I appreciate you being brief. Other lamp manufacturers who wish 

to comment at this point. Okay, yes sir. 

John Forsyth: 

Yes, my name is John Forsyth, I am the North American Marketing Manager representing 

Texas Instruments Lighting and Industrial Business Unit. We would like thank the United 

States DoE for the opportunity to speak at this forum and participate in this workshop on 

the ballast efficiency regulations and its potential impact on our business, which we believe 

to substantial. Texas Instruments Materials and Controls Group which is headquartered in 

Attleboro, Massachusetts is an employer of other 4,000 U.S. workers, many of which are 

directly associated with the design and manufacture of film protectors which serve the 

florescent ballast industry. In fact the ballast industry is by far our largest market segment 

in which nearly one hundred million protectors are supplied by Texas Instruments per 

year. The current proposal under consideration to revise florescent lamp ballast efficiency 

regulations which potentially could include outlawing the existing magnetic ballast product 

line threatens many jobs in our Massachusetts operation. It is our estimate at this time 

that a minimum of 80 full time employees would be idled. This would include both hourly 

and salaried employees. Besides the loss of U.S. jobs the premature obsolescence of our 

product which is used in magnetic ballast would also have substantial and unforecasted 

financial impact on our division. T.I. has invested greater than twenty million dollars in 

capital equipment that manufactures the thermal protector used in the majority of 

magnetic ballast. It is our estimate that as much of 40% of our production assets would 

be idled or under utilized. Since 1987 the use of electronic ballast has grown from 2% to 

nearly 40% on the market which is our estimates, we could be wrong, without government 

mandates. The fact that the market penetration of electronic ballast is occurring naturally 

at a high rate is strong evidence that natural market forces alone are accomplishing energy 

efficiency argues against an arbitrary product band. Thank you. 

Douglas Brookman: 

70 
Are there other members of the same industry , protectors? Okay, if I may I will go back

to this side of the room.

John Yodis:

My name is John Yodis. I am technical director of the P.D. George Company. We make

magnet-wiring enamels. These are insulating coatings that go on copper and aluminum

wire. We represent a relatively small but essential industry providing the electrical

insulation that goes into ballast transformers. From our industry standpoint a significant

percentage of our product goes into our transformers and would simply not be replaced in

electronic ballast. We will be negatively impacted by a sudden decision to shift the

industry in this direction with no cause for replacement for our technology . Thank you.

Douglas Brookman:

Is they're anybody else from the same electric insulation industry that wishes to comment.

Questions for this gentlemen. Let's just wait and get through all of this and then we will

proceed. To you sir.

Eugene Andert:

My name is Gene Andert and I'm with the Rea Magnet Wire Company and magnet wire

represents the copper aluminum wire that is used in the foil that includes the insulation

manufactured by P.D. George. We ask that as you consider your manufacturing inquiry

analysis you consider the impact on our industry as well. Florescent lighting ballast

represents 10% of the magnet wire usage in the United States. It includes somewhere in

the neighborhood of 500 to 700 jobs industry wide in the United States and around

seventy-five million dollars in plant equipment investment in the United States. For our

privately held company, Rea Magnet Wire Company it is 17% of our total business. It

represents twenty million dollars of our investment in our company and around one

hundred jobs so I respectfully ask that you consider that as you consider your analysis.

Douglas Brookman:

Thank you. Anybody else from magnet wire manufacturers. Yes.

71

EE-RM-97-500 COMMENT 21OO

Are there other members of the same industry, protectors? Okay, if I may I will go back 

to this side of the room. 

John Yodis: 

My name is John Yodis. I am technical director of the P.D. George Company. We make 

magnet-wiring enamels. These are insulating coatings that go on copper and aluminum 

wire. We represent a relatively small but essential industry providing the electrical 

insulation that goes into ballast transformers. From our industry standpoint a significant 

percentage of our product goes into our transformers and would simply not be replaced in 

electronic ballast. We will be negatively impacted by a sudden decision to shift the 

industry in this direction with no cause for replacement for our technology. Thank you. 

Douglas Brookman: 

Is they're anybody else from the same electric insulation industry that wishes to comment. 

Questions for this gentlemen. Let's just wait and get through all of this and then we will 

proceed. To you sir. 

Eugene Andert: 

My name is Gene Andert and I'm with the Rea Magnet Wire Company and magnet wire 

represents the copper aluminum wire that is used in the foil that includes the insulation 

manufactured by P.D. George. We ask that as you consider your manufacturing inquiry 

analysis you consider the impact on our industry as well. Florescent lighting ballast 

represents 10% of the magnet wire usage in the United States. It includes somewhere in 

the neighborhood of 500 to 700 jobs industry wide in the United States and around 

seventy-five million dollars in plant equipment investment in the United States. For our 

privately held company, Rea Magnet Wire Company it is 17% of our total business. It 

represents twenty million dollars of our investment in our company and around one 

hundred jobs so I respectfully ask that you consider that as you consider your analysis. 

Douglas Brookman: 

Thank you. Anybody else from magnet wire manufacturers. Yes. 

71 

Are there other members of the same industry, protectors? Okay, if I may I will go back 

to this side of the room. 

John Yodis: 

My name is John Yodis. I am technical director of the P.D. George Company. We make 

magnet-wiring enamels. These are insulating coatings that go on copper and aluminum 

wire. We represent a relatively small but essential industry providing the electrical 

insulation that goes into ballast transformers. From our industry standpoint a significant 

percentage of our product goes into our transformers and would simply not be replaced in 

electronic ballast. We will be negatively impacted by a sudden decision to shift the 

industry in this direction with no cause for replacement for our technology. Thank you. 

Douglas Brookman: 

Is they're anybody else from the same electric insulation industry that wishes to comment. 

Questions for this gentlemen. Let's just wait and get through all of this and then we will 

proceed. To you sir. 

Eugene Andert: 

My name is Gene Andert and I'm with the Rea Magnet Wire Company and magnet wire 

represents the copper aluminum wire that is used in the foil that includes the insulation 

manufactured by P.D. George. We ask that as you consider your manufacturing inquiry 

analysis you consider the impact on our industry as well. Florescent lighting ballast 

represents 10% of the magnet wire usage in the United States. It includes somewhere in 

the neighborhood of 500 to 700 jobs industry wide in the United States and around 

seventy-five million dollars in plant equipment investment in the United States. For our 

privately held company, Rea Magnet Wire Company it is 17% of our total business. It 

represents twenty million dollars of our investment in our company and around one 

hundred jobs so I respectfully ask that you consider that as you consider your analysis. 

Douglas Brookman: 

Thank you. Anybody else from magnet wire manufacturers. Yes. 

71 
Ray BeeBe:

Yes, Ray BeeBe from Phelps Dodge Corporation, Magnet Wire Division. I just want to

agree with my colleague here. I am manager of marketing and business analysis and our

independent analysis came up with very similar figures as far as the industry impact of 500

to 700 jobs and approximately equating to about one hundred twenty million pounds of

copper and aluminum wire production in copper equivalent pounds. We would be

negatively impacted. This would probably be the equivalent of two to three factories

worth of magnet wire production nationwide or it would reduce the production in existing

factories to subeconomic levels and because of this we perceive this analysis as a well

intentioned attempt in the marketplace but believe that the end result will be much like the

(not audible) markets that have failed in the east and we think that the marketplace, we

concur that marketplace penetration of electronic ballast has gone from 2% in 1987 to we

have figures of 40% in 1994, approximately 50% is the figure that is being tossed around

now of market penetration. Our colleague says they see a high end of 80%, we would feel

that our business would be strongly impacted so we oppose this.

Douglas Brookman:

Okay, thank you. Would anybody else in magnet wire. Yes, another magnet wire

manufacturer.

Larry Clark:

Larry Clark with Optec. We also manufacture magnet wire and have many of the same

comments that my two colleagues have. I would like to take it to an even to a personal

level. We only have one plant in the United States and it is in Mexico, Missouri. I grew

up there and a lot of those people working there at that plant are my friends and I would

sure like to keep them all working so I think we should consider that impact before we

change the regulation into a (not audible) industry.

Douglas Brookman:

Thank you very much. Any other magnet wire manufacturers.

72

EE-RM-97-500 COMMENT 21OO

Ray BeeBe: 

Yes, Ray BeeBe from Phelps Dodge Corporation, Magnet Wire Division. I just want to 

agree with my colleague here. I am manager of marketing and business analysis and our 

independent analysis came up with very similar figures as far as the industry impact of 500 

to 700 jobs and approximately equating to about one hundred twenty million pounds of 

copper and aluminum wire production in copper equivalent pounds. We would be 

negatively impacted. This would probably be the equivalent of two to three factories 

worth of magnet wire production nationwide or it would reduce the production in existing 

factories to subeconomic levels and because of this we perceive this analysis as a well 

intentioned attempt in the marketplace but believe that the end result will be much like the 

(not audible) markets that have failed in the east and we think that the marketplace, we 

concur that marketplace penetration of electronic ballast has gone from 2% in 1987 to we 

have figures of 40% in 1994, approximately 50% is the figure that is being tossed around 

now of market penetration. Our colleague says they see a high end of 80%, we would feel 

that our business would be strongly impacted so we oppose this. 

Douglas Brookman: 

Okay, thank you. Would anybody else in magnet wire. Yes, another magnet wire 

manufacturer. 

Larry Clark: 

Larry Clark with Optec. We also manufacture magnet wire and have many of the same 

comments that my two colleagues have. I would like to take it to an even to a personal 

level. We only have one plant in the United States and it is in Mexico, Missouri. I grew 

up there and a lot of those people working there at that plant are my friends and I would 

sure like to keep them all working so I think we should consider that impact before we 

change the regulation into a (not audible) industry. 

Douglas Brookman: 

Thank you very much. Any other magnet wire manufacturers. 

72 

Ray BeeBe: 

Yes, Ray BeeBe from Phelps Dodge Corporation, Magnet Wire Division. I just want to 

agree with my colleague here. I am manager of marketing and business analysis and our 

independent analysis came up with very similar figures as far as the industry impact of 500 

to 700 jobs and approximately equating to about one hundred twenty million pounds of 

copper and aluminum wire production in copper equivalent pounds. We would be 

negatively impacted. This would probably be the equivalent of two to three factories 

worth of magnet wire production nationwide or it would reduce the production in existing 

factories to subeconomic levels and because of this we perceive this analysis as a well 

intentioned attempt in the marketplace but believe that the end result will be much like the 

(not audible) markets that have failed in the east and we think that the marketplace, we 

concur that marketplace penetration of electronic ballast has gone from 2% in 1987 to we 

have figures of 40% in 1994, approximately 50% is the figure that is being tossed around 

now of market penetration. Our colleague says they see a high end of 80%, we would feel 

that our business would be strongly impacted so we oppose this. 

Douglas Brookman: 

Okay, thank you. Would anybody else in magnet wire. Yes, another magnet wire 

manufacturer. 

Larry Clark: 

Larry Clark with Optec. We also manufacture magnet wire and have many of the same 

comments that my two colleagues have. I would like to take it to an even to a personal 

level. We only have one plant in the United States and it is in Mexico, Missouri. I grew 

up there and a lot of those people working there at that plant are my friends and I would 

sure like to keep them all working so I think we should consider that impact before we 

change the regulation into a (not audible) industry. 

Douglas Brookman: 

Thank you very much. Any other magnet wire manufacturers. 

72 
Herb Rice:

My name is Herb Rice and I am general manager of Steiner Film, Inc. We are located in

Williamstown, Massachusetts. That is up in the northwestern corner of Massachusetts.

Our product that we are involved with the magnetic ballast - Metalized dielectric film.

Our customers are actually people who make capacitors, whether they be the ballast

manufacturers themselves or they be other companies who just make capacitors and then

in turn sell them to the ballast manufacturers. The product that we make for the magnetic

ballast is a major portion of our business so that any accelerated decrease in that business

over and above what is probably is inevitable as demonstrated in Bob's slide a few minutes

ago at least the decrease there that he showed went well into the year 2014 or something

like that. Which would give us time to adjust but if we have an abrupt change we are

probably putting 40 to 80 jobs in jeopardy. Perhaps that doesn't seem like a lot to some of

you but we are in a rural area. We are in an area that's just recovering from the 1970's and

1980's of thousands of manufacturing jobs that were lost there so it is significant. In

addition to that we have substantial investments in equipment. We make both the film

there from pellets. We make the polypropylene film and then we in turn metalize it. That

involves substantial equipment investments, which we have made and a lot of them are

geared specifically for this particular market area. We are involved in the electronic

ballast. Unfortunately for us in our particular business we are in film capacitors and not

electroeletics (not audible) and things like that that can be in the electronic ballast so that

while we would be involved in that growth of that market it in no way would replace the

volume of work, sales and so on that we do with the magnetic ballast so we just

encourage that if we could let the marketplace drive the situation rather than forcing it

with some regulation that we be our wish.

Douglas Brookman:

Okay anyone else from the Metalized film industry.

Tony Von Holle:

73

EE-RM-97-500 COMMENT 21OO

Herb Rice: 

My name is Herb Rice and I am general manager of Steiner Film, Inc. We are located in 

Williamstown, Massachusetts. That is up in the northwestern comer of Massachusetts. 

Our product that we are involved with the magnetic ballast - Metalized dielectric film. 

Our customers are actually people who make capacitors, whether they be the ballast 

manufacturers themselves or they be other companies who just make capacitors and then 

in turn sell them to the ballast manufacturers. The product that we make for the magnetic 

ballast is a major portion of our business so that any accelerated decrease in that business 

over and above what is probably is inevitable as demonstrated in Bob's slide a few minutes 

ago at least the decrease there that he showed went well into the year 2014 or something 

like that. Which would give us time to adjust but if we have an abrupt change we are 

probably putting 40 to 80 jobs injeopardy. Perhaps that doesn't seem like a lot to some of 

you but we are in a rural area. We are in an area that's just recovering from the 1970's and 

1980's of thousands of manufacturing jobs that were lost there so it is significant. In 

addition to that we have substantial investments in equipment. We make both the film 

there from pellets. We make the polypropylene film and then we in turn metalize it. That 

involves substantial equipment investments, which we have made and a lot of them are 

geared specifically for this particular market area. We are involved in the electronic 

ballast. Unfortunately for us in our particular business we are in film capacitors and not 

electroeletics (not audible) and things like that that can be in the electronic ballast so that 

while we would be involved in that growth of that market it in no way would replace the 

volume of work, sales and so on that we do with the magnetic ballast so we just 

encourage that if we could let the marketplace drive the situation rather than forcing it 

with some regulation that we be our wish. 

Douglas Brookman: 

Okay anyone else from the Metalized film industry. 

Tony Von Holle: 

73 

Herb Rice: 

My name is Herb Rice and I am general manager of Steiner Film, Inc. We are located in 

Williamstown, Massachusetts. That is up in the northwestern comer of Massachusetts. 

Our product that we are involved with the magnetic ballast - Metalized dielectric film. 

Our customers are actually people who make capacitors, whether they be the ballast 

manufacturers themselves or they be other companies who just make capacitors and then 

in turn sell them to the ballast manufacturers. The product that we make for the magnetic 

ballast is a major portion of our business so that any accelerated decrease in that business 

over and above what is probably is inevitable as demonstrated in Bob's slide a few minutes 

ago at least the decrease there that he showed went well into the year 2014 or something 

like that. Which would give us time to adjust but if we have an abrupt change we are 

probably putting 40 to 80 jobs injeopardy. Perhaps that doesn't seem like a lot to some of 

you but we are in a rural area. We are in an area that's just recovering from the 1970's and 

1980's of thousands of manufacturing jobs that were lost there so it is significant. In 

addition to that we have substantial investments in equipment. We make both the film 

there from pellets. We make the polypropylene film and then we in turn metalize it. That 

involves substantial equipment investments, which we have made and a lot of them are 

geared specifically for this particular market area. We are involved in the electronic 

ballast. Unfortunately for us in our particular business we are in film capacitors and not 

electroeletics (not audible) and things like that that can be in the electronic ballast so that 

while we would be involved in that growth of that market it in no way would replace the 

volume of work, sales and so on that we do with the magnetic ballast so we just 

encourage that if we could let the marketplace drive the situation rather than forcing it 

with some regulation that we be our wish. 

Douglas Brookman: 

Okay anyone else from the Metalized film industry. 

Tony Von Holle: 

73 
Good afternoon I have a brief statement that I would like to read into the record. I am

Tony Von Hole from Armco Incorporated. Armco is a U.S. company producing specialty

flat roll steel with over six thousand employees in Pennsylvania and Ohio primarily. Our

main products are stainless steels and alloy electrical steels. In fact we are the only full

line producer of these electrical steels in the United States. Alloy electrical steels are the

most efficient magnetic materials available for the magnetic cores used in motors and

transformers including ballast transformers. In fact a significant portion of our production

of alloy electrical steels is used in the ballast transformer industry. Since little if any core

steel is required for an electronic ballast any regulation that would ban the manufacture of

magnetic ballast would obviously result in lost sales to Armco. This lost portion of our

business if not replaced would be of a magnitude to cause reductions in revenues and

employment levels thus the impact of any such ban would be felt well beyond the ballast

industry itself. Thank you for your attention.

Douglas Brookman:

Thank you. Thank you so much. Yes sir.

Earl Sherman:

Yes my name is Earl Sherman. I am a senior officer with Aerovox, Inc.. We are located

in New Bedford, Massachusetts and we famish products to both the electronic as well as

the magnetic ballast manufacturers. Two simple issues. One we would like product

preference to be determined by the market without any regulations whatsoever, number

one issue. Second issue really relates to the economic impact it would have in our New

Bedford facility. We would not be in a position to replace the magnetic ballast capacitor

lost with the pickup of electronic components. In other words they just wouldn't balance

out and we would be forced to downsize in that operation. We have about 600 people

there now. Obviously we wouldn't - the ballast industry wouldn't represent 600 job losses

but it would represent a loss and a significant loss of our employees. Thank you.

Douglas Brookman:

74

EE-RM-97-500 COMMENT 21OO

Good afternoon I have a brief statement that I would like to read into the record. I am 

Tony Von Hole from Armco Incorporated. Armco is a U.S. company producing specialty 

flat roll steel with over six thousand employees in Pennsylvania and Ohio primarily. Our 

main products are stainless steels and alloy electrical steels. In fact we are the only full 

line producer of these electrical steels in the United States. Alloy electrical steels are the 

most efficient magnetic materials available for the magnetic cores used in motors and 

transformers including ballast transformers. In fact a significant portion of our production 

of alloy electrical steels is used in the ballast transformer industry. Since little if any core 

steel is required for an electronic ballast any regulation that would ban the manufacture of 

magnetic ballast would obviously result in lost sales to Armco. This lost portion of our 

business if not replaced would be of a magnitude to cause reductions in revenues and 

employment levels thus the impact of any such ban would be felt well beyond the ballast 

industry itself Thank you for yom attention. 

Douglas Brookman: 

Thank you. Thank you so much. Yes sir. 

Earl Sherman: 

Yes my name is Earl Sherman. I am a senior officer with Aerovox, Inc.. We are located 

in New Bedford, Massachusetts and we furnish products to both the electronic as well as 

the magnetic ballast manufacturers. Two simple issues. One we would like product 

preference to be determined by the market without any regulations whatsoever, number 

one issue. Second issue really relates to the economic impact it would have in our New 

Bedford facility. We would not be in a position to replace the magnetic ballast capacitor 

lost with the pick up of electronic components. In other words they just wouldn't balance 

out and we would be forced to downsize in that operation. We have about 600 people 

there now. Obviously we wouldn't - the ballast industry wouldn't represent 600 job losses 

but it would represent a loss and a significant loss of our employees. Thank you. 

Douglas Brookman: 

74 

Good afternoon I have a brief statement that I would like to read into the record. I am 

Tony Von Hole from Armco Incorporated. Armco is a U.S. company producing specialty 

flat roll steel with over six thousand employees in Pennsylvania and Ohio primarily. Our 

main products are stainless steels and alloy electrical steels. In fact we are the only full 

line producer of these electrical steels in the United States. Alloy electrical steels are the 

most efficient magnetic materials available for the magnetic cores used in motors and 

transformers including ballast transformers. In fact a significant portion of our production 

of alloy electrical steels is used in the ballast transformer industry. Since little if any core 

steel is required for an electronic ballast any regulation that would ban the manufacture of 

magnetic ballast would obviously result in lost sales to Armco. This lost portion of our 

business if not replaced would be of a magnitude to cause reductions in revenues and 

employment levels thus the impact of any such ban would be felt well beyond the ballast 

industry itself Thank you for yom attention. 

Douglas Brookman: 

Thank you. Thank you so much. Yes sir. 

Earl Sherman: 

Yes my name is Earl Sherman. I am a senior officer with Aerovox, Inc.. We are located 

in New Bedford, Massachusetts and we furnish products to both the electronic as well as 

the magnetic ballast manufacturers. Two simple issues. One we would like product 

preference to be determined by the market without any regulations whatsoever, number 

one issue. Second issue really relates to the economic impact it would have in our New 

Bedford facility. We would not be in a position to replace the magnetic ballast capacitor 

lost with the pick up of electronic components. In other words they just wouldn't balance 

out and we would be forced to downsize in that operation. We have about 600 people 

there now. Obviously we wouldn't - the ballast industry wouldn't represent 600 job losses 

but it would represent a loss and a significant loss of our employees. Thank you. 

Douglas Brookman: 

74 
Thank you very much. Yes sir.

Dennis Kurowski:

I am Dennis Kurowski; I am with LTV Steel and like several of my colleagues up here

before me LTV Steel would be negatively impacted if the electronic ballasts were

mandated. From a domestic steel producer standpoint the magnetic ballast market is an

important segment for cold rolled steel. Specifically cold rolled motor lamination steels

that are used in large quantities and they are not used in the electronic ballast. LTV

supplies to a number of customers in this market and LTV Steel over the past three to five

years has expended a lot of dollars and technical resources to develop better and improved

motor lamination steels that deliver greater energy efficiency for these ballast. If the

electronic ballast regulations are adopted there could be possible rippling effects in our

markets resulting in loss of sales, weakened customer base in several segments and a loss

of jobs at our steel mills, primarily our Hamilton mill, which is our major mill for this

product.

Douglas Brookman:

Thank you very much. is there anyone else representative of the industry that would wish

to comment at this time? Let me thank all of you that commented for your discipline. For

being brier and being on the point. I especially appreciate that as does everybody else in

the room I am sure. Gene you had a question or two. One was to the magnet wire

manufacturers.

Gene Foley, Alliance to Save Energy (ASE):

I'm just curious for my own sake what balancing effect the motor standard is increased

the efficiency of the motor standard that has increased sales, copper wire and high

efficiency metal lamination and equipment of that nature compared to the downsizing that

the ballancing had on the (not audible ). Do you all see a balancing effect there?

Eugene Andert; Rea Magnet Wire Division:

75

EE-RM-97-500 COMMENT 21OO

Thank you very much. Yes sir. 

Dennis Kurowski: 

I am Dennis Kurowski; I am with LTV Steel and like several of my colleagues up here 

before me LTV Steel would be negatively impacted if the electronic ballasts were 

mandated. From a domestic steel producer standpoint the magnetic ballast market is an 

important segment for cold rolled steel. Specifically cold rolled motor lamination steels 

that are used in large quantities and they are not used in the electronic ballast. LTV 

supplies to a number of customers in this market and LTV Steel over the past three to five 

years has expended a lot of dollars and technical resources to develop better and improved 

motor lamination steels that deliver greater energy efficiency for these ballast. If the 

electronic ballast regulations are adopted there could be possible rippling effects in our 

markets resulting in loss of sales, weakened customer base in several segments and a loss 

of jobs at our steel mills, primarily our Hamilton mill, which is our major mill for this 

product. 

Douglas Brookman: 

Thank you very much. Is there anyone else representative of the industry that would wish 

to comment at this time? Let me thank all of you that commented for your discipline. For 

being brief and being on the point. I especially appreciate that as does everybody else in 

the room I am sure. Gene you had a question or two. One was to the magnet wire 

manufacturers. 

Gene Foley, Alliance to Save Energy (ASE): 

I'm just curious for my own sake what balancing effect the motor standard is increased 

the efficiency of the motor standard that has increased sales, copper wire and high 

efficiency metal lamination and equipment of that nature compared to the downsizing that 

the ballancing had on the (not audible). Do you all see a balancing effect there? 

Eugene Andert; Rea Magnet Wire Division: 

75 

Thank you very much. Yes sir. 

Dennis Kurowski: 

I am Dennis Kurowski; I am with LTV Steel and like several of my colleagues up here 

before me LTV Steel would be negatively impacted if the electronic ballasts were 

mandated. From a domestic steel producer standpoint the magnetic ballast market is an 

important segment for cold rolled steel. Specifically cold rolled motor lamination steels 

that are used in large quantities and they are not used in the electronic ballast. LTV 

supplies to a number of customers in this market and LTV Steel over the past three to five 

years has expended a lot of dollars and technical resources to develop better and improved 

motor lamination steels that deliver greater energy efficiency for these ballast. If the 

electronic ballast regulations are adopted there could be possible rippling effects in our 

markets resulting in loss of sales, weakened customer base in several segments and a loss 

of jobs at our steel mills, primarily our Hamilton mill, which is our major mill for this 

product. 

Douglas Brookman: 

Thank you very much. Is there anyone else representative of the industry that would wish 

to comment at this time? Let me thank all of you that commented for your discipline. For 

being brief and being on the point. I especially appreciate that as does everybody else in 

the room I am sure. Gene you had a question or two. One was to the magnet wire 

manufacturers. 

Gene Foley, Alliance to Save Energy (ASE): 

I'm just curious for my own sake what balancing effect the motor standard is increased 

the efficiency of the motor standard that has increased sales, copper wire and high 

efficiency metal lamination and equipment of that nature compared to the downsizing that 

the ballancing had on the (not audible). Do you all see a balancing effect there? 

Eugene Andert; Rea Magnet Wire Division: 

75 
The consumption of magna wire by ballast pressure for magnetic ballast's right now is

larger than the consumption of wire in the industrial size motors that were mandated for

efficiency than with the 92 Energy Policy Act that went into effect last October. It's

slowly, for the most part; most of those motors were already being manufactured in the

United States at a relatively high efficiencies to begin with. There is some additional

volume as the result of that, but it is not coming at the rate that could replace the capacity

losted of the magnetic ballast (not audible).

Brookman:

Excuse me could you say you name again please?

Gene Andert:

Gene Andert with Rea Magnet Wire Division.

Brookman:

Thank you very much. Yes sir, your name?

Gerald F. Beatty:

Gerry Beatty, LTV Steel Company. To address the question of the change efficiency in

motors, this is basically not resulted in a net increase in steel. It has resulted in a shift of

the type of material many of the steels used in the laminations have different core loss

which results in efficiency has basically resulted in a shift from certain higher loss materials

to much lower lost products, but the net effect has basically been very minimal since many

of the motors, the way to steel used it is virtually the same whether its low efficiency or

high efficiency. It has resulted in a net shift in the type of materials but not the total

volume of materials.

Unknown:

Has the shift in materials been to the type of materials also used in efficiency magnetic (not

audible)?

Gerald Beatty:

In many cases, yes. Same type of material.

76

EE-RM-97-500 COMMENT 21OO

The consumption of magna wire by ballast pressure for magnetic ballast's right now is 

larger than the consumption of wire in the industrial size motors that were mandated for 

efficiency than with the 92 Energy Policy Act that went into effect last October. It's 

slowly, for the most part; most of those motors were already being manufactured in the 

United States at a relatively high efficiencies to begin with. There is some additional 

volume as the result of that, but it is not coming at the rate that could replace the capacity 

losted of the magnetic ballast (not audible). 

Brookman: 

Excuse me could you say you name again please? 

Gene Andert: 

Gene Andert with Rea Magnet Wire Division. 

Brookman: 

Thank you very much. Yes sir, your name? 

Gerald F. Beatty: 

Gerry Beatty, LTV Steel Company. To address the question of the change efficiency in 

motors, this is basically not resulted in a net increase in steel. It has resulted in a shift of 

the type of material many of the steels used in the laminations have different core loss 

which results in efficiency has basically resulted in a shift from certain higher loss materials 

to much lower lost products, but the net effect has basically been very minimal since many 

of the motors, the way to steel used it is virtually the same whether its low efficiency or 

high efficiency. It has resulted in a net shift in the type of materials but not the total 

volume of materials. 

Unknown: 

Has the shift in materials been to the type of materials also used in efficiency magnetic (not 

audible)? 

Gerald Beatty: 

In many cases, yes. Same type of material. 

76 

The consumption of magna wire by ballast pressure for magnetic ballast's right now is 

larger than the consumption of wire in the industrial size motors that were mandated for 

efficiency than with the 92 Energy Policy Act that went into effect last October. It's 

slowly, for the most part; most of those motors were already being manufactured in the 

United States at a relatively high efficiencies to begin with. There is some additional 

volume as the result of that, but it is not coming at the rate that could replace the capacity 

losted of the magnetic ballast (not audible). 

Brookman: 

Excuse me could you say you name again please? 

Gene Andert: 

Gene Andert with Rea Magnet Wire Division. 

Brookman: 

Thank you very much. Yes sir, your name? 

Gerald F. Beatty: 

Gerry Beatty, LTV Steel Company. To address the question of the change efficiency in 

motors, this is basically not resulted in a net increase in steel. It has resulted in a shift of 

the type of material many of the steels used in the laminations have different core loss 

which results in efficiency has basically resulted in a shift from certain higher loss materials 

to much lower lost products, but the net effect has basically been very minimal since many 

of the motors, the way to steel used it is virtually the same whether its low efficiency or 

high efficiency. It has resulted in a net shift in the type of materials but not the total 

volume of materials. 

Unknown: 

Has the shift in materials been to the type of materials also used in efficiency magnetic (not 

audible)? 

Gerald Beatty: 

In many cases, yes. Same type of material. 

76 
Unknown:

So the production for that (not audible) gone up.

Gerald Beatty:

It would in that effect with the decrease in other materials. There's basically been a shift

for many of the other ballast's in the, maybe not as high energy efficiency has dropped off,

so you're seeing a shift from one particular grade of steel to another grade.

Unknown:

I have a capacitor question.

Brookman:

Thank you very much sir. Can someone response to a capacitor questions?

Unknown:

It was eluded to but again the capacitors as I understand are used in both electronic and

magnetic ballast's. From a shift in a industry you don't envision that that change is going

to have occur anyway?

Herb Rice; Steiner Group:

I would agree. There in fact more capacitors, I guess in the (not audible) ballast's, but I

they're smaller and they're different types. Unfortunately for us, we just supply one type.

The film type as opposed to electro(not audible) ceramic or (not audible). Normally

people aren't in those multiple businesses. So what we're looking at is magnetic ballast's

that's got a large amount of metalized film in the (not audible) whereas electronic ballast's

is a smaller, a very much smaller percentage and probably here that know more about the

electronic ballast can comment on that better than I can.

Brookman:

Your name again please?

Herb Rice:

Herb Rice.

Brookman:

77

EE-RM-97-500 COMMENT 21OO

Unknown: 

So the production for that (not audible) gone up. 

Gerald Beatty: 

It would in that effect with the decrease in other materials. There's basically been a shift 

for many ofthe other ballast's in the, maybe not as high energy efficiency has dropped off, 

so you're seeing a shift from one particular grade of steel to another grade. 

Unknown: 

I have a capacitor question. 

Brookman: 

Thank you very much sir. Can someone response to a capacitor questions? 

Unknown: 

It was eluded to but again the capacitors as I understand are used in both electronic and 

magnetic ballast's. From a shift in a industry you don't envision that that change is going 

to have occur anyway? 

Herb Rice; Steiner Group: 

I would agree. There in fact more capaci~ors, I guess in the (not audible) ballast's, but I 

they're smaller and they're different types. Unfortunately for us, we just supply one type. 

The film type as opposed to electro(not audible) ceramic or (not audible). Normally 

people aren't in those multiple businesses. So what we're looking at is magnetic ballast's 

that's got a large amount ofmetalized film in the (not audible) whereas electronic ballast's 

is a smaller, a very much smaller percentage and probably here that know more about the 

electronic ballast can comment on that better than I can. 

Brookman: 

Your name again please? 

Herb Rice: 

Herb Rice. 

Brookman: 

77 

Unknown: 

So the production for that (not audible) gone up. 

Gerald Beatty: 

It would in that effect with the decrease in other materials. There's basically been a shift 

for many ofthe other ballast's in the, maybe not as high energy efficiency has dropped off, 

so you're seeing a shift from one particular grade of steel to another grade. 

Unknown: 

I have a capacitor question. 

Brookman: 

Thank you very much sir. Can someone response to a capacitor questions? 

Unknown: 

It was eluded to but again the capacitors as I understand are used in both electronic and 

magnetic ballast's. From a shift in a industry you don't envision that that change is going 

to have occur anyway? 

Herb Rice; Steiner Group: 

I would agree. There in fact more capaci~ors, I guess in the (not audible) ballast's, but I 

they're smaller and they're different types. Unfortunately for us, we just supply one type. 

The film type as opposed to electro(not audible) ceramic or (not audible). Normally 

people aren't in those multiple businesses. So what we're looking at is magnetic ballast's 

that's got a large amount ofmetalized film in the (not audible) whereas electronic ballast's 

is a smaller, a very much smaller percentage and probably here that know more about the 

electronic ballast can comment on that better than I can. 

Brookman: 

Your name again please? 

Herb Rice: 

Herb Rice. 

Brookman: 

77 
Thank you.

Earl Sherman, Aerovox, Inc.:

I agree with exactly with what Herb was just saying. The electronic ballast casts really

manage a type of (not audible) type film and otherwise and it's a different price tag on

them with that product of also. I have nothing against buying some foreign product but

most of that product is manufactured (not audible) for the purposes of this industry in

either the U.S. or (not audible). To make that point even stronger, most of the electronic

caps are and we have a number of them manufacturers here can certify to this, that they

are manufactured either in the far east or in some cases in Europe.

Unknown:

This is going to be my last general questions . The ballast manufactured now is by in large

magnetic and electronic (not audible) overseas. For all of your industry (not audible)

exporting all your products, overseas to be assembled and all (not audible)

Unknown:

What do you mean overseas?

Unknown:

Any work in the United States.

Brookman:

Across America, most of the ballast's are manufactured in Mexico.

Unknown:

I just wanted to make sure that I understood the process of all of these suppliers and

what's happening to their material and where its going. How this process actually is

occurring.

Rae Beebe; Phelps Dodge Magnet Wire Company:

We recently and our Chairman asserted that last time this iteration went through that we

recently built a plant in Monterey Mexico to supply some of our manufacturers and

bought a plant and enlarged in Texas, El Paso, Texas, and we envision that a large part of

78

EE-RM-97-500 COMMENT 21OO

Thank you. 

Earl Sherman, Aerovox, Inc.: 

I agree with exactly with what Herb was just saying. The electronic ballast casts really 

manage a type of (not audible) type:film and otherwise and it's a different price tag on 

them with that product of also. I have nothing against buying some foreign product but 

most of that product is manufactured (not audible) for the purposes of this industry in 

either the U.S. or (not audible). To make that point even stronger, most of the electronic 

caps are and we have a number of them manufacturers here can certifY to this, that they 

are manufactured either in the far east or in some cases in Europe. 

Unknown: 

This is going to be my last general questions. The ballast manufactured now is by in large 

magnetic and electronic (not audible) overseas. For all of your industry (not audible) 

exporting all your products, overseas to be assembled and all (not audible) 

Unknown: 

What do you mean overseas? 

Unknown: 

Any work in the United States. 

Brookman: 

Across America, most ofthe ballast's are manufactured in Mexico. 

Unknown: 

I just wanted to make sure that I understood the process of all of these suppliers and 

what's happening to their material and where its going. How this process actually is 

occurring. 

Rae Beebe; Phelps Dodge Magnet Wire Company: 

We recently and our Chairman asserted that last time this iteration went through that we 

recently built a plant in Monterey Mexico to supply some of our manufacturers and 

bought a plant and enlarged in Texas, El Paso, Texas, and we envision that a large part of 

78 

Thank you. 

Earl Sherman, Aerovox, Inc.: 

I agree with exactly with what Herb was just saying. The electronic ballast casts really 

manage a type of (not audible) type:film and otherwise and it's a different price tag on 

them with that product of also. I have nothing against buying some foreign product but 

most of that product is manufactured (not audible) for the purposes of this industry in 

either the U.S. or (not audible). To make that point even stronger, most of the electronic 

caps are and we have a number of them manufacturers here can certifY to this, that they 

are manufactured either in the far east or in some cases in Europe. 

Unknown: 

This is going to be my last general questions. The ballast manufactured now is by in large 

magnetic and electronic (not audible) overseas. For all of your industry (not audible) 

exporting all your products, overseas to be assembled and all (not audible) 

Unknown: 

What do you mean overseas? 

Unknown: 

Any work in the United States. 

Brookman: 

Across America, most ofthe ballast's are manufactured in Mexico. 

Unknown: 

I just wanted to make sure that I understood the process of all of these suppliers and 

what's happening to their material and where its going. How this process actually is 

occurring. 

Rae Beebe; Phelps Dodge Magnet Wire Company: 

We recently and our Chairman asserted that last time this iteration went through that we 

recently built a plant in Monterey Mexico to supply some of our manufacturers and 

bought a plant and enlarged in Texas, El Paso, Texas, and we envision that a large part of 

78 
this capacity which is supplying them as well as other industries, motors, automobile

would shift to the east and we'd basically be out of luck in that situation.

Brookman:

Additional questions for everybody who commented on the impacts on their industry.

Michael Rivest:

Following up on Gene's question trying to characterize the industry since it's becoming a

worldwide industry in the products that ballast manufactures are producing are being

made in moderation here in to the states. I assume it ought to be checked in other

countries as well. I would assume that for many of the (not audible) suppliers the same is

true whether (not audible) supplied to the main ballast manufacturers, some will subject to

standards but some will be also manufactured for other countries where there may or may

not be regulations. (not audible) is that the case, to what extent would the (not audible)

what impact would it have on the manufacturers as a whole. Could you segregate what is

manufactured for US consumption as opposed consumption of other ballast (not audible)

in other countries may not be subject to standard.

Mike Stein:

Let me try and respond this way, throughout the world ballast are sold for manufacture. I

don't know if there's really two types of technology of fluorescent ballast. Europe and

everyone who follows the European standards of 220 volts megahertz. They use reactor

product designed to IEC standards. In North America we have 120 volts, 270 (not

audible) volts, 60 hertz and transformers designed by industry standards. Canada and

Mexico pretty much powerless. There are a few parts of the world also that follow North

America practice not too much (not audible) South America (not audible) is relatively

limited compared to the IEC environment and what's...as far as the product that can be

sold as far as magnetic products. As far as (not audible) products actually that is

becoming more global because electronic ballast aren't reactors. Electronic ballast power

220 volts aren't to much different than electronic ballast powered by 120 or 277 volt.

79

EE-RM-97-500 COMMENT 21OO

this capacity which is supplying them as well as other industries, motors, automobile 

would shift to the east and we'd basically be out of luck in that situation. 

Brookman: 

Additional questions for everybody who commented on the impacts on their industry. 

Michael Rivest: 

Following up on Gene's question trying to characterize the industry since it's becoming a 

worldwide industry in the products that ballast manufactures are producing are being 

made in moderation here in to the states. I assume it ought to be checked in other 

countries as well. I would assume that for many ofthe (not audible) suppliers the same is 

true whether (not audible) supplied to the main ballast manufacturers, some will subject to 

standards but some will be also manufactured for other countries where there mayor may 

not be regulations. (not audible) is that the case, to what extent would the (not audible) 

what impact would it have on the manufacturers as a whole. Could you segregate what is 

manufactured for US consumption as opposed consumption of other ballast (not audible) 

in other countries may not be subject to standard. 

Mike Stein: 

Let me try and respond this way, throughout the world ballast are sold for manufacture. I 

don't know if there's really two types of technology of fluorescent ballast. Europe and 

everyone who follows the European standards of220 volts megahertz. They use reactor 

product designed to lEe standards. In North America we have 120 volts, 270 (not 

audible) volts, 60 hertz and transformers designed by industry standards. Canada and 

Mexico pretty much powerless. There are a few parts ofthe world also that follow North 

America practice not too much (not audible) South America (not audible) is relatively 

limited compared to the IEC environment and what's ... as far as the product that can be 

sold as far as magnetic products. As far as (not audible) products actually that is 

becoming more global because electronic ballast aren't reactors. Electronic ballast power 

220 volts aren't to much different than electronic ballast powered by 120 or 277 volt. 

79 

this capacity which is supplying them as well as other industries, motors, automobile 

would shift to the east and we'd basically be out of luck in that situation. 

Brookman: 

Additional questions for everybody who commented on the impacts on their industry. 

Michael Rivest: 

Following up on Gene's question trying to characterize the industry since it's becoming a 

worldwide industry in the products that ballast manufactures are producing are being 

made in moderation here in to the states. I assume it ought to be checked in other 

countries as well. I would assume that for many ofthe (not audible) suppliers the same is 

true whether (not audible) supplied to the main ballast manufacturers, some will subject to 

standards but some will be also manufactured for other countries where there mayor may 

not be regulations. (not audible) is that the case, to what extent would the (not audible) 

what impact would it have on the manufacturers as a whole. Could you segregate what is 

manufactured for US consumption as opposed consumption of other ballast (not audible) 

in other countries may not be subject to standard. 

Mike Stein: 

Let me try and respond this way, throughout the world ballast are sold for manufacture. I 

don't know if there's really two types of technology of fluorescent ballast. Europe and 

everyone who follows the European standards of220 volts megahertz. They use reactor 

product designed to lEe standards. In North America we have 120 volts, 270 (not 

audible) volts, 60 hertz and transformers designed by industry standards. Canada and 

Mexico pretty much powerless. There are a few parts ofthe world also that follow North 

America practice not too much (not audible) South America (not audible) is relatively 

limited compared to the IEC environment and what's ... as far as the product that can be 

sold as far as magnetic products. As far as (not audible) products actually that is 

becoming more global because electronic ballast aren't reactors. Electronic ballast power 

220 volts aren't to much different than electronic ballast powered by 120 or 277 volt. 

79 
Different front end but the outlet stage are very similar. Now we can look world wide on

the ballast industry electronically but that means we now have global competion.

Gene Andert, Rae Magna Wire:

To further respond to your question, the Magna Wire industry worldwide is primarily

regional in nature. Most of the Magna Wire that's used in North America, comes out of

North America. Most of the Magna Wire used in South America is produced in South

America. It's a heavy product to ship and most of its made locally. As we supply the

magnetic ballast industry, we're supplying it in North America whether its produced in

Canada or United States companies or on the border. It's hard to segregate what they

could be potentially be exporting versus what they are going to be shipping into the United

States because they buy, by insulation type and size. They don't tell us that it's going to

go into a ballast that going to be exported or one that is going to be consumed in the

United States. It would be virtually impossible for us to segregate our business, you know

that way.

Brookman:

Additional comments or questions at this before we go back to the Agenda as originally

planned.

Mike:

I would like to ask the question of how this is going to be handled in the manufactures

impact analysis. One part there was some mentioned some of the information we had

previously that the impact of suppliers through ballast manufacturers were going to be

analysis, but as you see there is a number of different industries that are impacted and how

are those industries going to be rolled into the whole study and maybe (not audible) talk

about later on in the Agenda (not audible).

Brookman:

Can we move on? OK let's do that then. Yes?

Unknown:

80

EE-RM-97-500 COMMENT 21OO

Different front end but the outlet stage are very similar. Now we can look world wide on 

the ballast industry electronically but that means we now have global competion. 

Gene Andert, Rae Magna Wire: 

To further respond to your question, the Magna Wire industry worldwide is primarily 

regional in nature. Most of the Magna Wire that's used in North America, comes out of 

North America. Most of the Magna Wire used in South America is produced in South 

America. It's a heavy product to ship and most ofits made locally. As we supply the 

magnetic ballast industry, we're supplying it in North America whether its produced in 

Canada or United States companies or on the border. It's hard to segregate what they 

could be potentially be exporting versus what they are going to be shipping into the United 

States because they buy, by insulation type and size. They don't tell us that it's going to 

go into a ballast that going to be exported or one that is going to be consumed in the 

United States. It would be virtually impossible for us to segregate our business, you know 

that way. 

Brookman: 

Mike: 

Additional comments or questions at this before we go back to the Agenda as originally 

planned. 

I would like to ask the question of how this is going to be handled in the manufactures 

impact analysis. One part there was some mentioned some of the information we had 

previously that the impact of suppliers through ballast manufacturers were going to be 

analysis, but as you see there is a number of different industries that are impacted and how 

are those industries going to be rolled into the whole study and maybe (not audible) talk 

about later on in the Agenda (not audible). 

Brookman: 

Can we move on? OK let's do that then. Yes? 

Unknown: 

80 

Different front end but the outlet stage are very similar. Now we can look world wide on 

the ballast industry electronically but that means we now have global competion. 

Gene Andert, Rae Magna Wire: 

To further respond to your question, the Magna Wire industry worldwide is primarily 

regional in nature. Most of the Magna Wire that's used in North America, comes out of 

North America. Most of the Magna Wire used in South America is produced in South 

America. It's a heavy product to ship and most ofits made locally. As we supply the 

magnetic ballast industry, we're supplying it in North America whether its produced in 

Canada or United States companies or on the border. It's hard to segregate what they 

could be potentially be exporting versus what they are going to be shipping into the United 

States because they buy, by insulation type and size. They don't tell us that it's going to 

go into a ballast that going to be exported or one that is going to be consumed in the 

United States. It would be virtually impossible for us to segregate our business, you know 

that way. 

Brookman: 

Mike: 

Additional comments or questions at this before we go back to the Agenda as originally 

planned. 

I would like to ask the question of how this is going to be handled in the manufactures 

impact analysis. One part there was some mentioned some of the information we had 

previously that the impact of suppliers through ballast manufacturers were going to be 

analysis, but as you see there is a number of different industries that are impacted and how 

are those industries going to be rolled into the whole study and maybe (not audible) talk 

about later on in the Agenda (not audible). 

Brookman: 

Can we move on? OK let's do that then. Yes? 

Unknown: 

80 
Speaking on behalf of everybody in the room, let me thank again (not audible) set up this

team for your comments and also for your discipline.

Mike Rivest:

We're going to keep working until almost 3:00 p.m. Let's see if can get to a natural

breakpoint in there somewhere, then we'll take a break and then we'll keep going until we

get done. Moving on talking about how we might adapt generic methodology to the

ballast industry. Phase 1 industry profile I anticipate we'll be talking to members of the

ballast industry about how we proceed for Phase 1. In Phase 2, I anticipate preparing a

strong (not audible) industry cash flow. When I talked about it a little while earlier, what

we're proposing to do is to put together a spreadsheet, the GRIM model with industry

average values and to use those as a starting point to initiate discussions which could be

part of the interview process. As we go into Phase 3 that interview process that would be

the GRIM model with the inputs that would be representative if you will of publicly

available information sources could become a methodology by which we can identify large

variances, explain any differences along the way. But finally coming back with our

interviews and our tailored manufacturing cash flows we can then re-aggregate into a final

industry cash flow which would be more accurate than just for Strawman Industry Cash

Flow that would have been apparent in Phase 2. We are able to do this in this industry

because we were faced with relatively small number of players, which would not be the

case for example: Central Air Conditioners were to have 100, 120.

Mike Stein:

In the Strawman Cash Flow, is it just for comparison purposes for dialog? How important

is that being accurate?

Mike Rivest:

Ballpark accurate? It doesn't have to be accurate of your company.

Mike Stein:

81

EE-RM-97-500 COMMENT 21OO

Speaking on behalf of everybody in the room, let me thank again (not audible) set up this 

team for your comments and also for your discipline. 

Mike Rivest: 

We're going to keep working until almost 3:00 p.rn. Let's see if can get to a natural 

breakpoint in there somewhere, then we'll take a break and then we'll keep going until we 

get done. Moving on talking about how we might adapt generic methodology to the 

ballast industry. Phase I industry profile I anticipate we'll be talking to members ofthe 

ballast industry about how we proceed for Phase 1. In Phase 2, I anticipate preparing a 

strong (not audible) industry cash flow. When I talked about it a little while earlier, what 

we're proposing to do is to put together a spreadsheet, the GRIM model with industry 

average values and to use those as a starting point to initiate discussions which could be 

part of the interview process. As we go into Phase 3 that interview process that would be 

the GRIM model with the inputs that would be representative if you will of publicly 

available information sources could become a methodology by which we can identifY large 

variances, explain any differences along the way. But finally coming back with our 

interviews and our tailored manufacturing cash flows we can then re-aggregate into a :final 

industry cash flow which would be more accurate than just for Strawman Industry Cash 

Flow that would have been apparent in Phase 2. We are able to do this in this industry 

because we were faced with relatively small number of players, which would not be the 

case for example: Central Air Conditioners were to have 100, 120. 

Mike Stein: 

In the Strawman Cash Flow, is it just for comparison purposes for dialog? How important 

is that being accurate? 

Mike Rivest: 

Ballpark accurate? It doesn't have to be accurate of your company. 

Mike Stein: 

81 

Speaking on behalf of everybody in the room, let me thank again (not audible) set up this 

team for your comments and also for your discipline. 

Mike Rivest: 

We're going to keep working until almost 3:00 p.rn. Let's see if can get to a natural 

breakpoint in there somewhere, then we'll take a break and then we'll keep going until we 

get done. Moving on talking about how we might adapt generic methodology to the 

ballast industry. Phase I industry profile I anticipate we'll be talking to members ofthe 

ballast industry about how we proceed for Phase 1. In Phase 2, I anticipate preparing a 

strong (not audible) industry cash flow. When I talked about it a little while earlier, what 

we're proposing to do is to put together a spreadsheet, the GRIM model with industry 

average values and to use those as a starting point to initiate discussions which could be 

part of the interview process. As we go into Phase 3 that interview process that would be 

the GRIM model with the inputs that would be representative if you will of publicly 

available information sources could become a methodology by which we can identifY large 

variances, explain any differences along the way. But finally coming back with our 

interviews and our tailored manufacturing cash flows we can then re-aggregate into a :final 

industry cash flow which would be more accurate than just for Strawman Industry Cash 

Flow that would have been apparent in Phase 2. We are able to do this in this industry 

because we were faced with relatively small number of players, which would not be the 

case for example: Central Air Conditioners were to have 100, 120. 

Mike Stein: 

In the Strawman Cash Flow, is it just for comparison purposes for dialog? How important 

is that being accurate? 

Mike Rivest: 

Ballpark accurate? It doesn't have to be accurate of your company. 

Mike Stein: 

81 
Ballpark of the industry. I think Phase 2 and Phase 3A, I mean Phase 2 as the way we see

it now. Phase 3A it's going to be a while before(not audible). As we spend substantial

time commenting to make the Strawman right.

Mike Divest:

Yes but not today. I think it's very important that before we sit with you and have our

interviews that we are benchmarking something realistic. If I come in and we're talking

about investments as being 3% of revenues and you know very well that it's 8%-9% for

example because the statistics I have are based mostly on the magnetic industry and I

don't have more recent information on the electronic industry, then I would like to know

that in advance so that our spreadsheet is the most realistic possible and that we can go

right into the variances.

Stein:

Basically your prices and (not audible) to start with are wrong.

Rivest:

Ok. That's fine. I'm going to be going.... Once again we have I see, 6 weeks at least to

get it right or to get it more right and any input you have today, I'd appreciate. Especially

how I might go about deriving the right inputs. But it was more today in terms of getting

the concept and the process going. That's my objective for this afternoon. Looking at the

profile, give me an example of how some of this industry statistic type information can be

useful in preparing the spreadsheets and also initiating dialog in identifying any strong

variances. I have industry statistics from the census of manufacturers who tell me that in

1992 reporting companies talked about 5,200 jobs for an annual sales of $500 million. So

right there we have some sort of metric for total jobs. We have some sort of metric jobs

per revenue. Figures that might be useful to try and identify any major differences.

Foley:

82

EE-RM-97-500 COMMENT 21OO

Ballpark ofthe industry. I think Phase 2 and Phase 3A, I mean Phase 2 as the way we see 

it now. Phase 3A it's going to be a while before(not audible). As we spend substantial 

time commenting to make the Strawman right. 

Mike Rivest: 

Stein: 

Rivest: 

Foley: 

Yes but not today. I think it's very important that before we sit with you and have our 

interviews that we are benchmarking something realistic. IfI come in and we're talking 

about investments as being 3% of revenues and you know very well that it's 8%-9% for 

example because the statistics I have are based mostly on the magnetic industry and I 

don't have more recent information on the electronic industry, then I would like to know 

that in advance so that our spreadsheet is the most realistic possible and that we can go 

right into the variances. 

Basically your prices and (not audible) to start with are wrong. 

Ok. That's fine. I'm going to be going .... Once again we have I see, 6 weeks at least to 

get it right or to get it more right and any input you have today, I'd appreciate. Especially 

how I might go about deriving the right inputs. But it was more today in tenns of getting 

the concept and the process going. That's my objective for this afternoon. Looking at the 

profile, give me an example of how some of this industry statistic type information can be 

useful in preparing the spreadsheets and also initiating dialog in identifying any strong 

variances. I have industry statistics from the census of manufacturers who tell me that in 

1992 reporting companies talked about 5,200 jobs for an annual sales of$500 million. So 

right there we have some sort of metric for total jobs. We have some sort of metric jobs 

per revenue. Figures that might be useful to try and identifY any major differences. 

82 

Ballpark ofthe industry. I think Phase 2 and Phase 3A, I mean Phase 2 as the way we see 

it now. Phase 3A it's going to be a while before(not audible). As we spend substantial 

time commenting to make the Strawman right. 

Mike Rivest: 

Stein: 

Rivest: 

Foley: 

Yes but not today. I think it's very important that before we sit with you and have our 

interviews that we are benchmarking something realistic. IfI come in and we're talking 

about investments as being 3% of revenues and you know very well that it's 8%-9% for 

example because the statistics I have are based mostly on the magnetic industry and I 

don't have more recent information on the electronic industry, then I would like to know 

that in advance so that our spreadsheet is the most realistic possible and that we can go 

right into the variances. 

Basically your prices and (not audible) to start with are wrong. 

Ok. That's fine. I'm going to be going .... Once again we have I see, 6 weeks at least to 

get it right or to get it more right and any input you have today, I'd appreciate. Especially 

how I might go about deriving the right inputs. But it was more today in tenns of getting 

the concept and the process going. That's my objective for this afternoon. Looking at the 

profile, give me an example of how some of this industry statistic type information can be 

useful in preparing the spreadsheets and also initiating dialog in identifying any strong 

variances. I have industry statistics from the census of manufacturers who tell me that in 

1992 reporting companies talked about 5,200 jobs for an annual sales of$500 million. So 

right there we have some sort of metric for total jobs. We have some sort of metric jobs 

per revenue. Figures that might be useful to try and identifY any major differences. 

82 
I guess this also to Michael McCabe. You are analyzing the job impacts to these

standards, can we make a differentiation between U.S. jobs and jobs that are not U.S.

based?

Rivest:

Foley:

Rivest:

Foley:

Rivest:

Foley:

These jobs here are all US based and just because of the way census has captures the

information that's on a plant level.

As you take this out and go beyond that then you would strictly being looking at US jobs?

My intention is to gather information on jobs at the plant level and not differentiate where

the plant is, then report that back to DoE.

That being the US based plant versus the plant in Mexico?

Right. And then reporting that back to DoE

Is it appropriate that the USE DoE gather inibrma:iit n on plants outside of the US

boundaries?

McCabe:

To whether or not is it appropriate, (not audible) if we can gather that information. The

administration talks about the economic impact on the manufacturers which is what we

tried to capture here, it does not distinguish between were these manufacturers have these

facilities located. Some here in the states, some on the border and the firm is a US firm it

would be information I would be interested in. I'm not sure if we can get all this data.

Foley:

83

EE-RM-97-500 COMMENT 21OO

Rivest: 

Foley: 

Rivest: 

Foley: 

Rivest: 

Foley: 

I guess this also to Michael McCabe. You are analyzing the job impacts to these 

standards, can we make a differentiation between u.s. jobs and jobs that are not u.s. 

based? 

These jobs here are all us based and just because of the way census has captures the 

information that's on a plant level. 

As you take this out and go beyond that then you would strictly being looking at us jobs? 

My intention is to gather information on jobs at the plant level and not differentiate where 

the plant is, then report that back to DoE. 

That being the US based plant versus the plant in Mexico? 

Right. And then reporting that back to DoE 

Is it appropriate that the US DoE gather iniormation on plants outside of the US 

boundaries? 

McCabe: 

Foley: 

To whether or not is it appropriate, (not audible) ifwe can gather that information. The 

administration talks about the economic impact on the manufacturers which is what we 

tried to capture here, it does not distinguish between were these manufacturers have these 

facilities located. Some here in the states, some on the border and the :firm is a US :firm lit 

would be information I would be interested in. I'm not sure if we can get all this data. 

83 

Rivest: 

Foley: 

Rivest: 

Foley: 

Rivest: 

Foley: 

I guess this also to Michael McCabe. You are analyzing the job impacts to these 

standards, can we make a differentiation between u.s. jobs and jobs that are not u.s. 

based? 

These jobs here are all us based and just because of the way census has captures the 

information that's on a plant level. 

As you take this out and go beyond that then you would strictly being looking at us jobs? 

My intention is to gather information on jobs at the plant level and not differentiate where 

the plant is, then report that back to DoE. 

That being the US based plant versus the plant in Mexico? 

Right. And then reporting that back to DoE 

Is it appropriate that the US DoE gather iniormation on plants outside of the US 

boundaries? 

McCabe: 

Foley: 

To whether or not is it appropriate, (not audible) ifwe can gather that information. The 

administration talks about the economic impact on the manufacturers which is what we 

tried to capture here, it does not distinguish between were these manufacturers have these 

facilities located. Some here in the states, some on the border and the :firm is a US :firm lit 

would be information I would be interested in. I'm not sure if we can get all this data. 

83 
So a non-US firm-manufacturing ballast's overseas is still interested in (not audible)

outside of the United States are still interested in the (not audible) jobs that are impacted

beyond the use (not audible).

McCabe:

I'm interested in getting as rich data as we can on the impacts of the regulation. The

policy maker here, the department when presented with information about impacts may

look at it and distinguish between US jobs or US firms in a way that maybe significant to

them but from an analytic point of view. I would like to capture that information.

Foley:

Then it would be my request then to or at least that that data be differentiated that way.

(not audible) US jobs are identified, the jobs overseas are identified and the US firms are

identified and the non-US firms are identified.

Brookman:

To an extent that can be done, yes. As far as money flows that's an entirely different

think. Money has no boundaries. When I do the cash flow analysis ... (not audible)capacity

impacts I think what applies to jobs.

Wolfrnan:

Money in terms of corporate money may have no boundaries but money in terms of

payroll does have boundaries.

Brookman:

Keep going.

Rivest:

I'm just carrying on with this type of information that might be useful from our data book.

The annual investments and new capital expenditures combined with years of service of

the equipment might give us an idea of the size of the asset base in the production of

ballast's for example. This kind of background information can be very useful in setting

up our placeholder values and spreadsheet but also in discussion with manufacturers about

84

EE-RM-97-500 COMMENT 21OO

So a non-US firm-manufacturing ballast's overseas is still interested in (not audible) 

outside of the United States are still interested in the (not audible) jobs that are impacted 

beyond the use (not audible). 

McCabe: 

Foley: 

I'm interested in getting as rich data as we can on the impacts of the regulation. The 

policy maker here, the department when presented with information about impacts may 

look at it and distinguish between US jobs or US firms in a way that maybe significant to 

them but from an analytic point of view. I would like to capture that information. 

Then it would be my request then to or at least that that data be differentiated that way. 

(not audible) US jobs are identified, the jobs overseas are identified and the US firms are 

identified and the non-US firms are identified. 

Brookman: 

To an extent that can be done, yes, As far as money flows that's an entirely different 

think. Money has no boundaries. When I do the cash flow analysis ... (not audible )capacity 

impacts I think what applies to jobs. 

Wo l:fi:nan: 

Money in terms of corporate money may have no boundaries but money in terms of 

payroll does have boundaries. 

Brookman: 

Rivest: 

Keep going. 

I'm just carrying on with this type of information that might be useful from our data book. 

The annual investments and new capital expenditures combined with years of service of 

the equipment might give us an idea of the size of the asset base in the production of 

ballast's for example. This kind of background information can be very useful in setting 

up our placeholder values and spreadsheet but also in discussion with manufacturers about 

84 

So a non-US firm-manufacturing ballast's overseas is still interested in (not audible) 

outside of the United States are still interested in the (not audible) jobs that are impacted 

beyond the use (not audible). 

McCabe: 

Foley: 

I'm interested in getting as rich data as we can on the impacts of the regulation. The 

policy maker here, the department when presented with information about impacts may 

look at it and distinguish between US jobs or US firms in a way that maybe significant to 

them but from an analytic point of view. I would like to capture that information. 

Then it would be my request then to or at least that that data be differentiated that way. 

(not audible) US jobs are identified, the jobs overseas are identified and the US firms are 

identified and the non-US firms are identified. 

Brookman: 

To an extent that can be done, yes, As far as money flows that's an entirely different 

think. Money has no boundaries. When I do the cash flow analysis ... (not audible )capacity 

impacts I think what applies to jobs. 

Wo l:fi:nan: 

Money in terms of corporate money may have no boundaries but money in terms of 

payroll does have boundaries. 

Brookman: 

Rivest: 

Keep going. 

I'm just carrying on with this type of information that might be useful from our data book. 

The annual investments and new capital expenditures combined with years of service of 

the equipment might give us an idea of the size of the asset base in the production of 

ballast's for example. This kind of background information can be very useful in setting 

up our placeholder values and spreadsheet but also in discussion with manufacturers about 

84 
how their level of vertical integration may greatly change those ratios for example. It's a

starting point for dialog. We have gained some appreciation of the differences which

confirms through a series of interviews that we did last year . My apology is to Robertson

which we did not have a chance to interview, but certainly those interviews were

instrumental in thinking through about how we would structure this analysis . Not to say

that it wasn't useful to talk to the Alliance to Save Energy. Some of the conclusions from

that round of interviews we've already touched on those in the last few minutes but, it

really is in fact meaningful to talk about sub-groups ballast manufacturers and I think you

can dream up more sub-groups then there are manufacturers so to the extent that we can

work directly with individual manufacturers and get an understanding of their situation. I

think that's the best way to go. We need to recognize the global nature of the industry.

There's four companies that can make product in the US, there are US companies who

don't make products in the US, money and the situation I think the cash flow deals at the

company level and that goes with the impacts which we are going to try and capture. We

will consider the direct industries and suppliers as appropriate . Appropriateness has

possible and I'm happy to see that a lot of those initial contact has been made and it would

be my intention to try and talk to each of these people individually if possible. Certainly

not with the same interview survey or the same cash flow type analysis but just to try and

really understand the size of those impacts and be able confidently report them back to the

policy makers at DoE.

Rivest:

Gene?

Gene:

On the terms of the companies you interviewed have you considered expanding the scope

of the companies interviewing to those that strictly make electronic ballast's?

Unknown:

Doesn't make. Well the people impacted the most make strictly magnetic.

85

EE-RM-97-500 COMMENT 21OO

Rivest: 

Gene: 

how their level of vertical integration may greatly change those ratios for example. It's a 

starting point for dialog. We have gained some appreciation of the differences which 

confirms through a series of interviews that we did last year. My apology is to Robertson 

which we did not have a chance to interview, but certainly those interviews were 

instrumental in thinking through about how we would structure this analysis. Not to say 

that it wasn't useful to talk to the Alliance to Save Energy. Some of the conclusions from 

that round of interviews we've already touched on those in the last few minutes but, it 

really is in fact meaningful to talk about sub-groups ballast manufacturers and I think you 

can dream up more sub-groups then there are manufacturers so to the extent that we can 

work directly with individual manufacturers and get an understanding of their situation. I 

think that's the best way to go. We need to recognize the global nature ofthe industry. 

There's four companies that can make product in the US, there are US companies who 

don't make products in the US, money and the situation I think the cash flow deals at the 

company level and that goes with the impacts which we are going to try and capture. We 

will consider the direct industries and suppliers as appropriate. Appropriateness has 

possible and I'm happy to see that a lot ofthose initial contact has been made and it would 

be my intention to try and talk to each of these people individually if possible. Certainly 

not with the same interview surveyor the same cash flow type analysis but just to try and 

really understand the size of those impacts and be able confidently report them back to the 

policy makers at DoE. 

Gene? 

On the terms of the companies you interviewed have you considered expanding the scope 

ofthe companies interviewing to those that strictly make electronic ballast's? 

Unknown: 

Doesn't make. Well the people impacted the most make strictly magnetic. 

85 

Rivest: 

Gene: 

how their level of vertical integration may greatly change those ratios for example. It's a 

starting point for dialog. We have gained some appreciation of the differences which 

confirms through a series of interviews that we did last year. My apology is to Robertson 

which we did not have a chance to interview, but certainly those interviews were 

instrumental in thinking through about how we would structure this analysis. Not to say 

that it wasn't useful to talk to the Alliance to Save Energy. Some of the conclusions from 

that round of interviews we've already touched on those in the last few minutes but, it 

really is in fact meaningful to talk about sub-groups ballast manufacturers and I think you 

can dream up more sub-groups then there are manufacturers so to the extent that we can 

work directly with individual manufacturers and get an understanding of their situation. I 

think that's the best way to go. We need to recognize the global nature ofthe industry. 

There's four companies that can make product in the US, there are US companies who 

don't make products in the US, money and the situation I think the cash flow deals at the 

company level and that goes with the impacts which we are going to try and capture. We 

will consider the direct industries and suppliers as appropriate. Appropriateness has 

possible and I'm happy to see that a lot ofthose initial contact has been made and it would 

be my intention to try and talk to each of these people individually if possible. Certainly 

not with the same interview surveyor the same cash flow type analysis but just to try and 

really understand the size of those impacts and be able confidently report them back to the 

policy makers at DoE. 

Gene? 

On the terms of the companies you interviewed have you considered expanding the scope 

ofthe companies interviewing to those that strictly make electronic ballast's? 

Unknown: 

Doesn't make. Well the people impacted the most make strictly magnetic. 

85 
Gene:

People depends on how you define impacted. The people who make magnetic ballast's

are impacted ostensibly because they have lowering amounts of product that they produce

and also have lowering employment and all those issues. Unfortunately, we don't get the

balance, the symmetry.

Unknown:

I'd be interested in hearing what industry has to say about that, but I think that everyone

who is at this table represents 95% of both magnetic and electronic. So that is a fair

estimate? So the balance is here.

Gene:

I think there's a shift and I think as the industry changes it would be worthwhile speaking

to a number of the other manufacturers to see what they envision the changes to occur

should a new standard go into effect. I think you're failing to sort of capture.

Unknown:

Let me give you my rationale on this. I have 100%, I have 30 million magnetic ballast's

that are going to be transferred over to electronic perhaps, only 75% of that because of 4

lamp fixtures and the like. I have a market share there of 100% even if I were to interview

12 ballast manufacturers in China and they all tell me they are going to get 100 jobs,

they're all still fighting for those 75% of 30 million ballast's. So the impact when you

consider the full range of the 30 million becoming 22 million, the employment, the total

employment resulting in electronic versus the total employment shifted from (not audible).

I'm not going to forget anything . You won't let me.

McCabe:

One thing to reiterate what Michael has just said with respect to the type of supplier

industry. At this point in time, we do not anticipate performing sort of economic impact

analysis on the supplier industry as we do on the ballast manufacturer's. We are interested

in being able to characterize that industry and to identify ways that metrics can be

86

EE-RM-97-500 COMMENT 21OO

Gene: 

People depends on how you define impacted. The people who make magnetic ballast's 

are impacted ostensibly because they have lowering amounts of product that they produce 

and also have lowering employment and all those issues. Unfortunately, we don't get the 

balance, the symmetry. 

Unknown: 

Gene: 

I'd be interested in hearing what industry has to say about that, but I think. that everyone 

who is at this table represents 95% of both magnetic and electronic. So that is a fair 

estimate? So the balance is here. 

I think there's a shift and I think as the industry changes it would be worthwhile speaking 

to a number of the other manufacturers to see what they envision the changes to occur 

should a new standard go into effect. I think. you're failing to sort of capture. 

Unknown: 

Let me give you my ratior..ale on this. I have 100%, I have 30 million magnetic ballast's 

that are going to be transferred over to electronic perhaps, only 75% of that because of 4 

lamp fixtures and the like. I have a market share there of 100% even if I were to interview 

12 ballast manufacturers in China and they all tell me they are going to get 100 jobs, 

they're all still fighting for those 75% of30 million ballast's. So the impact when you 

consider the full range of the 30 million becoming 22 million, the employment, the total 

employment resulting in electronic versus the total employment shifted from (not audible). 

I'm not going to forget anything. You won't let me. 

McCabe: 

One thing to reiterate what Michael has just said with respect to the type of supplier 

industry. At this point in time, we do not anticipate performing sort of economic impact 

analysis on the supplier industry as we do on the ballast manufacturer's. We are interested 

in being able to characterize that industry and to identify ways that metrics can be 

86 

Gene: 

People depends on how you define impacted. The people who make magnetic ballast's 

are impacted ostensibly because they have lowering amounts of product that they produce 

and also have lowering employment and all those issues. Unfortunately, we don't get the 

balance, the symmetry. 

Unknown: 

Gene: 

I'd be interested in hearing what industry has to say about that, but I think. that everyone 

who is at this table represents 95% of both magnetic and electronic. So that is a fair 

estimate? So the balance is here. 

I think there's a shift and I think as the industry changes it would be worthwhile speaking 

to a number of the other manufacturers to see what they envision the changes to occur 

should a new standard go into effect. I think. you're failing to sort of capture. 

Unknown: 

Let me give you my ratior..ale on this. I have 100%, I have 30 million magnetic ballast's 

that are going to be transferred over to electronic perhaps, only 75% of that because of 4 

lamp fixtures and the like. I have a market share there of 100% even if I were to interview 

12 ballast manufacturers in China and they all tell me they are going to get 100 jobs, 

they're all still fighting for those 75% of30 million ballast's. So the impact when you 

consider the full range of the 30 million becoming 22 million, the employment, the total 

employment resulting in electronic versus the total employment shifted from (not audible). 

I'm not going to forget anything. You won't let me. 

McCabe: 

One thing to reiterate what Michael has just said with respect to the type of supplier 

industry. At this point in time, we do not anticipate performing sort of economic impact 

analysis on the supplier industry as we do on the ballast manufacturer's. We are interested 

in being able to characterize that industry and to identify ways that metrics can be 

86 
appropriate to present to the decision makers of ...or somebody secondary for the impacts

would be so we're not proposing to do any like GRIM (not audible). GRIM Analysis

(not audible) film industry, (not audible) industry (not audible).

Unknown:

I can bound the issue by say, if I have my 22 million magnetic ballast's with the help of

industry I may be able to do an estimate of pounds of steel and copper that are involved.

Then applies to industry wide ratios (not audible) things like that. It's doable it just won't

be a 30 year cash flow process.

Howard Wolfman:

To keep the record straight and comment on what he was saying one of the ballast

manufactures that was interviewed was Motorola and one of (not audible) electronic

ballast.

Unknown:

Thanks for the verification.

Rivest:

I'll move on and talk about the industry cash flow. First of all the tool we'll be using is an

Excel based spreadsheet which is a pro forma cash flow analysis which considers revenues

less expenses adds back depreciation and subtracts any capital investments. So I do have

a copy of the GRIM here with us and after the break I'll put it up on the screen. You'll

see I've linked it to the net spreadsheet to be able to import some of the shipments (not

audible).

Unknown:

Don't you have another program called Jeepers. You put them together and you have

Grim Jeepers?

Unknown:

I was demonstrating the software a little earlier this month, I think to Norm Grimshaw.

Rivest:

87

EE-RM-97-500 COMMENT 21OO

appropriate to present to the decision makers of ... or somebody secondary for the impacts 

would be so we're not proposing to do any like GRIM (not audible). GRIM Analysis 

(not audible) film industry, (not audible) industry (not audible). 

Unknown: 

I can bound the issue by say, if I have my 22 million magnetic ballast's with the help of 

industry I may be able to do an estimate of pounds of steel and copper that are involved. 

Then applies to industry wide ratios ( not audible) things like that. It's doable it just won't 

be a 30 year cash flow process. 

Howard Wolfinan: 

To keep the record straight and comment on what he was saying one of the ballast 

manufactures that was interviewed was Motorola and one of (not audible) electronic 

ballast. 

Unknown: 

Rivest: 

Thanks for the verification. 

I'll move on and talk about the industry cash flow. First of all the tool we'll be using is an 

Excel based spreadsheet which is a pro forma cash flow analysis which considers revenues 

less expenses adds back depreciation and subtracts any capital investments. So I do have 

a copy ofthe GRIM here with us and after the break I'll put it up on the screen. You'll 

see I've linked it to the net spreadsheet to be able to import some ofthe shipments (not 

audible). 

Unknown: 

Don't you have another program called Jeepers. You put them together and you have 

Grim Jeepers? 

Unknown: 

I was demonstrating the software a little earlier this month, I think to Norm Grimshaw. 

Rivest: 

87 

appropriate to present to the decision makers of ... or somebody secondary for the impacts 

would be so we're not proposing to do any like GRIM (not audible). GRIM Analysis 

(not audible) film industry, (not audible) industry (not audible). 

Unknown: 

I can bound the issue by say, if I have my 22 million magnetic ballast's with the help of 

industry I may be able to do an estimate of pounds of steel and copper that are involved. 

Then applies to industry wide ratios ( not audible) things like that. It's doable it just won't 

be a 30 year cash flow process. 

Howard Wolfinan: 

To keep the record straight and comment on what he was saying one of the ballast 

manufactures that was interviewed was Motorola and one of (not audible) electronic 

ballast. 

Unknown: 

Rivest: 

Thanks for the verification. 

I'll move on and talk about the industry cash flow. First of all the tool we'll be using is an 

Excel based spreadsheet which is a pro forma cash flow analysis which considers revenues 

less expenses adds back depreciation and subtracts any capital investments. So I do have 

a copy ofthe GRIM here with us and after the break I'll put it up on the screen. You'll 

see I've linked it to the net spreadsheet to be able to import some ofthe shipments (not 

audible). 

Unknown: 

Don't you have another program called Jeepers. You put them together and you have 

Grim Jeepers? 

Unknown: 

I was demonstrating the software a little earlier this month, I think to Norm Grimshaw. 

Rivest: 

87 
My simplified version of the GRIM - prices, shipments, costs, financial information about

ratios, percentage of, typical financial information resulting in a cash flow analysis and a

lot of that information is available through analysis and data that was collected for other

parts of the analysis. For example, we do have for manufacturing prices, we do have

reports from CIR which gives the value of shipments and quantity of shipments for various

ballast's categories. There's not a perfect one to one relationship between those and the

exact ballast categories we're looking. But we feel it is a very good ballpark value and

we'll look at those a little later. Manufacturing cost data, the costs that we had in the first

engineering analysis was based on some confidential data that was collected I think

through one or two manufacturers. What we're proposing to do here is to based on the

industry analysis of a typical cost structure from publicly available financial information,

we'll "reverse engineer" some of the cost elements and those can be our starting point to

draw some comparisons with specific and individual manufacturer data. The shipments

will be linked to the net spreadsheet. It's clear that the manufacturing impacts are directly

related to the base K shipments. If the market is to go on its own very rapidly towards all

of electronics the impact of the magnetic ballast will be much less than if its anticipated

that the market share of magnetic ballast would stay constant. So there's a balancing here.

Large energy savings, large manufactures impacts. Compared to few slides, just looking

quickly at some of the inputs that we can use for GRIM, for example. For the

manufacturer prices we have the current industrial reports, the major ballast categories

we'll be looking at and tracking in the cash flow analysis aren't the same as for the

National Energy Savings spreadsheet which are the F40's, T12. I think it's only T12 that

we're looking at. And we're converting from 4 kinds of, 4 classes of magnetic ballast to 6

classes of electronics ballast I believe, because we do have the possibility of having 3 lamp

and 4 lamp electronic ballast's. By the way, you'll notice this is one slide that was revised

(not audible). So in the revised slides package you'll see the correct slide which you have

here. There was one category, which is not a very good fit between the costs as reported

88

EE-RM-97-500 COMMENT 21OO

My simplified version of the GRIM - prices, shipments, costs, financial information about 

ratios, percentage of, typical financial information resulting in a cash flow analysis and a 

lot ofthat information is available through analysis and data that was collected for other 

parts of the analysis. For example, we do have for manufacturing prices, we do have 

reports from CIR which gives the value of shipments and quantity of shipments for various 

ballast's categories. There's not a perfect one to one relationship between those and the 

exact ballast categories we're looking. But we feel it is a very good ballpark value and 

we'll look at those a little later. Manufacturing cost data, the costs that we had in the first 

engineering analysis was based on some confidential data that was collected I think 

through one or two manufacturers. What we're proposing to do here is to based on the 

industry analysis of a typical cost structure from publicly available financial information, 

we'll "reverse engineer" some of the cost elements and those can be our starting point to 

draw some comparisons with specific and individual manufacturer data. The shipments 

will be linked to the net spreadsheet. It's clear that the manufacturing impacts are directly 

related to the base K smpments. If the market is to go on its own very rapidly towards all 

of electronics the impact of the magnetic ballast will be much less than if its anticipated 

that the market share of magnetic ballast would stay constant. So there's a balancing here. 

Large energy savings, large m'l11ufactures impacts. Compared to few slides, just looking 

quickly at some ofthe inputs that we can use for GRIM, for example. For the 

manufacturer prices we have the current industrial reports, the major ballast categories 

we'll be looking at and tracking in the cash flow analysis aren't the same as for the 

National Energy Savings spreadsheet which are the F40's, T12. I think it's only T12 that 

we're looking at. And we're converting from 4 kinds of, 4 classes of magnetic ballast to 6 

classes of electronics ballast I believe, because we do have the possibility of having 3 lamp 

and 4 lamp electronic ballast's. By the way, you'll notice this is one slide that was revised 

(not audible). So in the revised slides package you'll see the correct slide which you have 

here. There was one category, which is not a very good fit between the costs as reported 

88 

My simplified version of the GRIM - prices, shipments, costs, financial information about 

ratios, percentage of, typical financial information resulting in a cash flow analysis and a 

lot ofthat information is available through analysis and data that was collected for other 

parts of the analysis. For example, we do have for manufacturing prices, we do have 

reports from CIR which gives the value of shipments and quantity of shipments for various 

ballast's categories. There's not a perfect one to one relationship between those and the 

exact ballast categories we're looking. But we feel it is a very good ballpark value and 

we'll look at those a little later. Manufacturing cost data, the costs that we had in the first 

engineering analysis was based on some confidential data that was collected I think 

through one or two manufacturers. What we're proposing to do here is to based on the 

industry analysis of a typical cost structure from publicly available financial information, 

we'll "reverse engineer" some of the cost elements and those can be our starting point to 

draw some comparisons with specific and individual manufacturer data. The shipments 

will be linked to the net spreadsheet. It's clear that the manufacturing impacts are directly 

related to the base K smpments. If the market is to go on its own very rapidly towards all 

of electronics the impact of the magnetic ballast will be much less than if its anticipated 

that the market share of magnetic ballast would stay constant. So there's a balancing here. 

Large energy savings, large m'l11ufactures impacts. Compared to few slides, just looking 

quickly at some ofthe inputs that we can use for GRIM, for example. For the 

manufacturer prices we have the current industrial reports, the major ballast categories 

we'll be looking at and tracking in the cash flow analysis aren't the same as for the 

National Energy Savings spreadsheet which are the F40's, T12. I think it's only T12 that 

we're looking at. And we're converting from 4 kinds of, 4 classes of magnetic ballast to 6 

classes of electronics ballast I believe, because we do have the possibility of having 3 lamp 

and 4 lamp electronic ballast's. By the way, you'll notice this is one slide that was revised 

(not audible). So in the revised slides package you'll see the correct slide which you have 

here. There was one category, which is not a very good fit between the costs as reported 

88 
in the CIR and the GRIM product class and a couple of asterisks here. That's one that

we'll be looking at for better information. The 2F96T12HO. We would certainly like to

have better information on that price.

Unknown:

The two areas I wanted to comment on price is that one, because that presently in a since

was before, includes a whole group of other (not audible) ballast's which aren't 296 high

alpha and the other one to comment on is actually the highest volume one which is a

2F40T12 which includes some product not included in this. (not audible)product. Which

brings the price lower than actually is for the ballast to meet the (not audible)

requirements.

Rivest:

One fundamental point that was touched on earlier by Gene and by others was the issue of

the conversion. There's an assumption when we do the manufacturing impact that we're

going from magnetic ballast and we're only looking at those magnetic ballast that are

impacted by regulation so if it's a declining scenario or fixed scenario we're only tracking

those ballast and we're converting them over to either (not audible ) or electronic ballast's.

One of the assumptions here that you'll see the GRIM later, we did set up the GRIM with

the conversion of T12 loop magnetic to T12 electronic . Now it would be up to

manufacturers if they have different assumptions about where the market is going to

change those ballast shipments and have the correct prices and then costs for those ballast

classes. So that's why here we did in fact look at the average prices of the 32-watt

products electronic. The TA type. As place holder values, I worked back from the CIR

prices to break down that price into various cost and profit elements. This is the pie chart,

it's also a revised slide, breakdowns a little different. The process we used to generate

these numbers we had information from the census of manufacturers which was ballast

specific. Some other categories unfortunately are reported at a higher level of aggregation

for the transformer industry. We had information from Robert Morris Associates and this

89

EE-RM-97-500 COMMENT 21OO

in the CIR and the GRIM product class and a couple of asterisks here. That's one that 

we'll be looking at for better information. The 2F96T12HO. We would certainly like to 

have better information on that price. 

Unknown: 

Rivest: 

The two areas I wanted to comment on price is that one, because that presently in a since . 

was before, includes a whole group of other (not audible) ballast's which aren't 296 high 

alpha and the other one to comment on is actually the highest volume one which is a 

2F40T12 which includes some product not included in this. (not audible)product. Which 

brings the price lower than actually is for the ballast to meet the (not audible) 

requirements. 

One fundamental ~oint that was touched on earlier by Gene and by others was the issue of 

the cODversion. There's an assumption when we do the manufacturing impact that we're 

going from magnetic ballast and we're only looking at those magnetic ballast that are 

impacted by regulation so ifit's a declining scenario or fixed scenario we're only tracking 

those ballast and we're converting them over to either (not audible) or electronic ballast's. 

One of the assumptions here that you'll see the GRIM later, we did set up the GRIM with 

the conversion ofT12 bop magnetic to T12 electronic. Now it would be up to 

manufacturers if they have different assumptions about where the market is going to 

change those ballast shipments and have the correct prices and then costs for those ballast 

classes. So that's why here we did in fact look at the average prices ofthe 32-watt 

products electronic. The TA type. As place holder values, I worked back from the CIR 

prices to break down that price into various cost and profit elements. This is the pie chart, 

it's also a revised slide, breakdowns a little different. The process we used to generate 

these numbers we had information from the census of manufacturers which was ballast 

specific. Some other categories unfortunately are reported at a higher level of aggregation 

for the transformer industry. We had information from Robert Morris Associates and this 

89 
new slide reflects the analysis of l OK's from 2 ballast manufacturers to the extent that you

can call the ballast manufacturers because some of them are so diversified there are very

few in fact in this room that a) are publicly available and b) have ballast's manufacturing as

a significant part of their business. Looking at the cost inputs to GRIM it's not critical

that in doing the cash flow that we have an accurate breakdown of material labor and all

these components. So it is important that we understand fixed versus variable . The main

use of this aggregated data might be to get some handle on some jobs impact, might be

able to correlate typical unit shipments and unit labor components inside a ballast for

example, what the totaljobs impacting a client could correlate as well as some of the

tooling costs with the necessary investments and changing over production to an

electronic ballast for example . Mostly that in the GRIM, there's an area where we have to

try and anticipate what the investment would be to switch over production to a higher

standard level.

Bob Wisbey:

Could you comment on what you to the right hand column of this as identified as total

cost because of the recent, within my normal interpretation where I think is normal

interpretation for accounting principals, that isn't really the total cost.

Rivest:

Cost is one of those things.......

Wisbey:

Cost for me is revenue minus profit equals cost.

- Rivest:

As I recall my financial accountant course has different definitions than manufacturing

accounting course. I think the cost here is the direct manufacturing cost that you would

report in your 1 OK as work in progress for example. Or inventory whereas cost is to my

accountant would be what's left. So it's everything except profit here.

Wisbey:

90

EE-RM-97-500 COMMENT 21OO

new slide reflects the analysis of 10K's from 2 ballast manufacturers to the extent that you 

can call the ballast manufacturers because some of them are so diversified there are very 

few in fact in this room that a) are publicly available and b) have ballast's manufacturing as 

a significant part of their business. Looking at the cost inputs to GRIM it's not critical 

that in doing the cash flow that we have an accurate breakdown of material labor and all 

these components. So it is important that we understand fixed versus variable. The main 

use of this aggregated data might be to get some handle on some jobs impact, might be 

able to correlate typical unit shipments and unit labor components inside a ballast for 

example, what the total jobs impacting a client could correlate as well as some of the 

tooling costs with the necessary investments and changing over production to an 

electronic ballast for example. Mostly that in the GRIM, there's an area where we have to 

try and anticipate what the investment would be to switch over production to a higher 

standard level. 

Bob Wisbey: 

Rivest: 

Could you comment on what you to the right hand column of this as identified as total 

cost because of the recent, within my normal interpretation where I think is normal 

interpretation for accounting principals, that isn't really the total cost. 

Cost is one of those things ...... . 

Wisbey: 

Rivest: 

Cost for me is revenue minus profit equals cost. 

As I recall my financial accountant course has different definitions than manufacturing 

accounting course. I think the cost here is the direct manufacturing cost that you would 

report in your 10K as work in progress for example. Or inventory whereas cost is to my 

accountant would be what's left. So it's everything except profit here. 

Wisbey: 

90 
And I would just say, just ask that as you go on through these that you use some other

word for that other than total cost.

Rivest:

Production costs maybe.

Wisbey:

Identifies it accurately as to what is. Because it is kind of a funny looking picture,

someone sitting looking across and looks at selling prices. They can draw completely

opposite impression.

Divest:

Last thing you need is more competitors. The inputs menu you'll see..... you'll see in the

GRIM this is one of the first major assumptions stage where you define some of the

financial parameters. I've got some values in here that reflect some of the pie chart we

saw a little earlier. Also some additional analysis we did on tax rates. Gets a truly

complicated when you have companies who have plants spread all over the world to try

and really determine what the marginal tax rate is for ballast manufacturing. So we

understand that this is going to be out of range. Working capital is to recognize the fact

that as your sales go through the roof, if you have a more expensive product, you are also

going to have to carry more inventory, higher receivables and that's really a cash drain.

Standard SGNA, depreciation depending on the base case, Normally when you look at a

company's 1 OK's they're adding capital faster than they are depreciating because there's

normally a growth in business. The assumptions would have to be changed if we're seeing

flat or decreasing so these wouldn't need to change in the two particular circumstances

we're looking at. The shipment values are going to be obtained from the net spreadsheet.

I have the GRIM with me but I'd like to take a day or two. A couple of things that need

to be changed. Right now, the cash flow goes out to the year 2012 and a lot of our

scenarios go for shipments goes as far as I saw 2015, 2018. And since what a trunk hits

now, it has residual terminal value calculated as an annuity that will give you a wrong

91

EE-RM-97-500 COMMENT 21OO

Rivest: 

And I would just say, just ask that as you go on through these that you use some other 

word for that other than total cost. 

Production costs maybe. 

Wisbey: 

Rivest: 

Identifies it accurately as to what is. Because it is kind of a funny looking picture, 

someone sitting looking across and looks at selling prices. They can draw completely 

opposite impression. 

Last thing you need is more competitors. The inputs menu you'll see ..... you'll see in the 

GRIM this is one of the first major assumptions stage where you define some of the 

financial parameters. I've got some values in here that reflect some of the pie chart we 

saw a little earlier. Also some additional analysis we did on tax rates. Gets a truly 

complicated when you have companies who have plants spread all over the world to try 

and really determine what the marginal tax rate is for ballast manufacturing. So we 

understand that this is going to be out of range. Working capital is to recognize the fact 

that as your sales go through the roof, if you have a more expensive product, you are also 

going to have to carry more inventory, higher receivables and that's really a cash drain. 

Standard SGN~ depreciation depending on the base case, Normally when you look at a 

company's 10K's they're adding capital faster than they are depreciating because there's 

normally a growth in business. The assumptions would have to be changed ifwe're seeing 

flat or decreasing so these wouldn't need to change in the two particular circumstances 

we're looking at. The shipment values are going to be obtained from the net spreadsheet. 

I have the GRIM with me but I'd like to take a day or two. A couple of things that need 

to be changed. Right now, the cash flow goes out to the year 2012 and a lot of our 

scenarios go for shipments goes as far as I saw 2015,2018. And since what a trunk hits 

now, it has residual terminal value calculated as an annuity that will give you a wrong 

91 
answer. If the shipments are going to continue to change after 2012. So I need to do that

modification. I also need to link it to your new version of the net spreadsheet. Anything

scenario you do use to calculate manufacturer impacts are going to a mirror image of

whatever scenarios we're calculating national benefits from. One of these slides are just

repetitive of some of the stuff you did this morning. I used two scenarios. One with flat

magnetic ballast shipments over time, the other with decrease adjunctable on the net

spreadsheet. You'll see in the GRIM. Mike, you were tracking shipments in the (not

audible). So when we're calculating the cash flow we're comparing it best case scenario.

Here we have decreasing shipments scenario and we're comparing that to a situation

before and after standards with the large break on a standard year where we go from

producing magnetic ballast's to producing electronic ballast. And there's a conversion

ratio there that's not necessarily one to one depending on the product class. There's some

preliminary discussions I've had with people in this room. It will be possible for

manufacturers to make different assumptions about how this transition actually will

happen. There may be a large inventory built up towards the end that would cause a spike

in shipments and then a large drop of shipments of ballast after the (not audible) of the

standards. But significant because that's the point in time when you're investing and

you're more vulnerable for any cash shortages.

Unknown:

What are the bottom graphs?

Rivest:

That's just. These are the four ballast's, magnetic ballast classes that are being tracked

and these are the six electronic ballast classes that are being tracked. And the reason there

are six compared to four is because there's one, two, three and four lamp electronic

ballast's whereas there's only one and two lamp magnetic ballast's. That's also a revised

slide.

Unknown:

92

EE-RM-97-500 COMMENT 21OO

answer. If the shipments are going to continue to change after 2012. So I need to do that 

modification. I also need to link it to your new version ofthe net spreadsheet. Anything 

scenario you do use to calculate manufacturer impacts are going to a mirror image of 

whatever scenarios we're calculating national benefits from. One of these slides are just 

repetitive of some of the stuff you did this morning. I used two scenarios. One with flat 

magnetic ballast srJpments over time, the other with decrease adjunctable on the net 

spreadsheet. You'll see in the GRIM. Mike, you were tracking shipments in the (not 

audible). So when we're calculating the cash flow we're comparing it best case scenario. 

Here we ruwe decreasing shipments scenario and we're comparing that to a situation 

before and after standards with the large break on a standard year where we go from 

producing magnetic ballast's to producing electronic ballast. And there's a conversion 

ratio there that's not necessarily one to one depending on the product class. There's some 

preliminary discussions I've had with people in this room. It will be possible for 

manufacturers to make different assumptions about how this transition actually will 

happen. There may be a large inventory built up towards the end that would cause a spike 

in shipments and then a large drop of shipments of ballast after the (not audible) of the 

standards. But significant because that's the point in time when you're investing and 

you're more vulnerable for any cash shortages. 

Unknown: 

Rivest: 

What are the bottom graphs? 

That's just. These are the four ballast's, magnetic ballast classes that are being tracked 

and these are the six electronic ballast classes that are being tracked. And the reason there 

are six compared to four is because there's one, two, three and four lamp electronic 

ballast's whereas there's only one and two lamp magnetic ballast's. That's also a revised 

slide. 

Unknown: 

92 
Why did the electronic ballast decrease over time?

Rivest:

Because we're only considering the impact to standards on these ballast's. Some subtly of

the analysis when we get into comparing or start playing around with the spreadsheet, and

I saw the one critical assumption is the magnitude of the investments to upgrade to the

new standard and in doing a differential cash flow for a base case, it's pretty easy. The

case where things are flat then there would be no investment in the electronic ballast.

You're just going along replenishing your depreciation with new capital additions just

maintaining an even, equal capital asset base. The case of the standards of magnetic

where shipments dropped they are replaced by electronic ballast, you have a large spike in

investments. Individually, manufacturers will be able to make their own assumptions

about the size and the timing of these investments whether its done over a period of a

couple years or over a period of one year for example. Things get a little but more tricky

in the situation where the base case is decreasing, in that case to be able to compare

investments in an electronic ballast's from one situation to the other that I'm tracking the

investment in the electronic ballast's that are continuously replacing these to the scenario

here where I'm replacing and the having a large spike to replace the remaining market

share. So the differential cash flow has to look at the magnitude, since the market is going

to zero, the investment is the same. The timing of the investment that is different. And

because of the time value of money, one large hit today is a lot harder than a steady flow

of investment. There's several worksheets within the GRIM model. Basically what we

did, we're using the GRIM model as it was, what we're preparing a preGRIM, if you will,

which is just allowed the aggregation of the different ballast classes. So what you're

seeing here is the actual GRIM model which only tracks, total units, total revenues

compared to the input sheet which has all the financial parameters for all the different

ballast classes. So it's what I call the GRIM of the preGRIM in here as far as this

spreadsheet is concerned it's the same for any other analysis for another product. My

93

EE-RM-97-500 COMMENT 21OO

Rivest: 

Why did the electronic ballast decrease over time? 

Because we're only considering the impact to standards on these ballast's. Some subtly of 

the analysis when we get into comparing or start playing around with the spreadsheet, and 

I saw the one critical assumption is the magnitude of the investments to upgrade to the 

new standard and in doing a differential cash flow for a base case, it's pretty easy. The 

case where things are flat then there would be no investment in the electronic ballast. 

You're just going along replenishing your depreciation with new capital additions just 

maintaining an even, equal capital asset base. The case of the standards of magnetic 

where shipments dropped they are replaced by electronic ballast, you have a large spike in 

investments. Individually, manufacturers will be able to make their own assumptions 

about the size and the timing of these investments whether its done over a period of a 

couple years or over a period of one year for example. Things get a little but more tricky 

in the situation where the base case is decreasing, in that case to be able to compare 

investments in an electronic ballast's from one situation to the other that I'm tracking the 

investment in the electronic ballast's that are continuously replacing these to the scenario 

here where I'm replacing and the having a large spike to replace the remaining market 

share. So the differential cash flow has to look at the magnitude, since the market is gomg 

to zero, the investment is the same. The timing of the investment that is different. And 

because ofthe time value of money, one large hit today is a lot harder than a steady flow 

of investment. There's several worksheets within the GRIM model. Basically what we 

did, we're using the GRIM model as it was, what we're preparing a preGRIM, if you will, 

which is just allowed the aggregation of the different ballast classes. So what you're 

seeing here is the actual GRIM model which only tracks, total units, total revenues 

compared to the input sheet which has all the financial parameters for all the different 

ballast classes. So it's what I call the GRIM of the preGRIM in here as far as this 

spreadsheet is concerned it's the same for any other analysis for another product. My 

93 
following slides are about to say and I'll say it right now, what we 'd be looking for in

terms of reporting back, is reporting at this level of aggregation. So to maintain some

confidentiality and the fact that there 's a few manufacturers, there's so few that may

produce one or another ballast type . We think is just more appropriate to report an

average price, total shipments for the whole industry. Then explain how the different

manufacturers ratios might differ from this aggregate industry value.

Brookman:

Comment on this briefly before we go to break. Questions ? This aspect of Mike Rivest's

presentation.

Unknown:

What appears as 26 in the (not audible) constant shipments scenario and then the one that

falls on page 27, the declining shipment scenario, just so that I understand, this is only for

new investment. This doesn't cover the issue of the so-called conversion costs that will be

incurred.

Rivest:

No, this is only investment sort of amortized investments. There may be other one-time

capital conversions, one-time costs like there's additional marketing cost, things like that.

But you wouldn't depreciate over time. Those are an expense item like in the GRIM.

Unknown:

Actually you have two items. You have product conversion expense and conversion

capital expense. One's capital and one is expense. We actually think that that's sort of

critical to the whole analysis. We're wondering are you even going to attempt to identify

those for your Strawman or not?

Rivest:

I think those one-time expenses, I think we should.

Unknown:

How, I don't' see any tables in here or any charts that even addressed the issue.

94

EE-RM-97-500 COMMENT 21OO

following slides are about to say and I'll say it right now, what we'd be looking for in 

terms of reporting back, is reporting at this level of aggregation. So to maintain some 

confidentiality and the fact that there's a few manufacturers, there's so few that may 

produce one or another ballast type. We think is just more appropriate to report an 

average price, total shipments for the whole industry. Then explain how the different 

manufacturers ratios might differ from this aggregate industry value. 

Brookman: 

Comment on this briefly before we go to break. Questions? This aspect of Mike Rivest's 

presentation. 

Unknown: 

Rivest: 

What appears as 26 in the (not audible) constant shipments scenario and then the one that 

falls on page 27, the declining shipment scenario, just so that I understand, this is only for 

new investment. This doesn't cover the issue of the so-called conversion costs that will be 

incurred. 

No, this is only investment sort of amortized investments. There may be other one-time 

capital conversions, one~time costs like there's additional marketing cost, things like that. 

But you wouldn't depreciate over time. Those are an expense item like in the GRIM. 

Unknown: 

Rivest: 

Actually you have two items. You have product conversion expense and conversion 

capital expense. One's capital and one is expense. We actually think that that's sort of 

critical to the whole analysis. We're wondering are you even going to attempt to identifY 

those for your Strawman or not? 

I think those one-time expenses, I think we should. 

Unknown: 

How, I don't' see any tables in here or any charts that even addressed the issue. 

94 
Divest:

They don't, you're right.

Unknown:

In fact, my (not audible) you handed out you left that blank, that's why I was asking

whether (not audible).

Divest:

I intend to do it. I'm not sure at this point where I can even get that information from

public sources, but maybe from sources in this room. I can get a rules of thumb for

marketing expense and launching of new products.

Unknown:

We have a couple of questions about what's on page 34. I think we haven't gotten that

far yet. I want to make sure.

Rivest:

I would rather go on for another 5 or 10 minutes. Go to the end of this section and then

after the break we'll just go to the spreadsheet.,

Brookman:

Can everybody hang on 5-10 minutes? Keep going.

Rivest:

Slides 30 here just reiterates what I said earlier. We're putting together a Strawman and

we'll be visiting manufacturers. This describes the aggregation process, putting together a

Strawman individual manufacture visits and financial analysis and then the re-aggregation

into an industry cash flow. Some discussion here about the fact that we're not interested,

well, interested but we're not asking for prices, costs, shipments information at the

product class level, but rather at the overall company impact. 34. This is a revised slide.

Unknown:

(not audible)

Rivest:

95

EE-RM-97-500 COMMENT 21OO

Rivest: 

They don't, you're right. 

Unknown: 

Rivest: 

In fact, my (not audible) you handed out you left that blank, that's why I was asking 

whether (not audible). 

I intend to do it. I'm not sure at this point where I can even get that information from 

public sources, but maybe from sources in this room. I can get a rules of thumb for 

marketing expense and lallDChing of new products. 

Unknown: 

Rivest: 

We have a couple of questions about what's on page 34. I think we haven't gotten that 

far yet. I want to make sure. 

I would rather go on for another 5 or 10 minutes. Go to the end of this section and then 

after the break we'lJ just go to the spreadsheet, 

Brookman: 

Rivest: 

Can everybody hang on 5-10 minutes? Keep going. 

Slides 30 here just reiterates what I said earlier. We're putting together a Strawman and 

we'll be visiting manufacturers. This describes the aggregation process, putting together a 

Strawman individual manufacture visits and financial analysis and then the re-aggregation 

into an industry cash flow. Some discussion here about the fact that we're not interested, 

well, interested but we're not asking for prices, costs, shipments information at the 

product class level, but rather at the overall company impact. 34. This is a revised slide. 

Unknown: 

(not audible) 

Rivest: 

95 
Don't even look at the numbers, don't freak out over that. My analysis is finished I can

take the color out. From the first spreadsheet to other spreadsheets, we've added product

classes. I'm not sure what the other changes were. I wouldn't be concerned with what

the final numbers are at this point. I didn't even give it a whole lot of thought. The point

of this slide is to show you that this is the level of aggregation that it would be reported at

for the industry. For the base case and the standards case, for this scenario with

decreasing shipments and for the scenario with constant shipments. So you would have

four of these essentially. And then a qualitative discussion keeping confidentiality open to

individual manufacturers explaining variances using tools like saying things like the

negative impacts are born by 90% of the negative impacts by two manufacturers or

something like that. Types of things census does with when they have confidentiality

issues.

Unknown:

Before you take 34 off. 34 is a base case scenario so there are not standards right?

Rivest:

This was no standard. I don't know if this a constant shipments.

Unknown:

Yes. So when you put in a standard aligns a product conversion expense, conversion

capital expense, those will go positive in at least the early years. In some years.

Rivest:

Exactly, you'll have a capital conversion expense where you would take a large hit to

convert over, your revenues would increase, your assets bases increases and then your

annual maintenance or capital replenishment, if you will, would also increase substantially.

And your product conversion may be something that happens over a period of two-three

years, slightly before or slightly after the standards are in place. Educate consumers and

what not.

Unknown:

96

EE-RM-97-500 COMMENT 21OO

Don't even look at the numbers, don't freak out over that. My analysis is finished I can 

take the color out. From the first spreadsheet to other spreadsheets, we've added product 

classes. I'm not sure what the other changes were. I wouldn't be concerned with what 

the final numbers are at this point. I didn't even give it a whole lot of thought. The point 

of this slide is to show you that this is the level of aggregation that it would be reported at -

for the industry. For the base case and the standards case, for this scenario with 

decreasing shipments and for the scenario with constant shipments. So you would have 

four of these essentially. And then a qualitative discussion keeping confidentiality open to 

individual manufacturers explaining variances using tools like saying things like the 

negative impacts are born by 90% of the negative impacts by two manufacturers or 

something like that. Types of things census does with when they have confidentiality 

Issues. 

Unknown: 

Before you take 34 off. 34 is a base case scenario so there are not standards right? 

Rivest: 

This was no standard. I don't know if this a constant shipments. 

Unknown: 

Rivest: 

Yes. So when you put in a standard aligns a product conversion expense, conversion 

capital expense, those will go positive in at least the early years. In some years. 

Exactly, you'll have a capital conversion expense where you would take a large hit to 

convert over, your revenues would increase, your assets bases increases and then your 

annual maintenance or capital replenishment, if you will, would also increase substantially, 

And your product conversion may be something that happens over a period oftwo-three 

years, slightly before or slightly after the standards are in place. Educate consumers and 

what not. 

Unknown: 

96 
I wonder if you could briefly explain the bottom rows under the cash flow statement. You

have net cash flow, terminal value and the present value factor, discounted cash flow and

then say presumably some sort of net present value.

Rivest:

What this number does is it totals these numbers here.

Unknown:

The discounted cash flows?

Rivest:

Yes, this discounted cash flow, this number is an addition of these numbers. This is just a

discount factor to take into account the time value of money between one year to the next.

So it's compound interest, if you will, discount factor. The terminal values that I

explained a little earlier, isn't a problem here because it's a flat shipments for the situation

where I've got my base case coming to 2015, 2018 than to just assume here an annuity is

wrong. So, I've got some work in extending to at least 2020.

Unknown:

I'm still not sure if I understand what you might call these two here, but what industry

value and present value is?

Rivest:

That is the value of the industry which is currently shipping 31.5 million magnetic ballast.

Unknown:

The value in terms that you're capitalizing your earnings? Or are these in terms of

capitalization factors? That's what I don't understand.

Rivest:

It's the revenue stream, what's left in your pocket at the end of the year in real cash

money and after you've sold your product, paid you're suppliers, paid back the interest on

your debt and that's what's left here. You're making income from operations 8.7 million

97

EE-RM-97-500 COMMENT 21OO

Rivest: 

I wonder if you could briefly explain the bottom rows under the cash flow statement. You 

have net cash flow, terminal value and the present value factor, discounted cash flow and 

then say presumably some sort of net present value. 

What this number does is it totals these numbers here. 

Unknown: 

Rivest: 

The discounted cash flows? 

Yes, this discounted cash flow, this number is an addition of these numbers. This is just a 

discount factor to take into account the time value of money between one year to the next. 

So it's compound interest, if you will, discount factor. The terminal values that I 

explained a little earlier, isn't a problem here because it's a flat shipments for the situation 

where I've got my base case coming to 2015, 2018 than to just assume here an annuity is 

wrong. So, I've got some work in extending to at least 2020. 

Unknown: 

Rivest: 

I'm still not sure if I understand what you might call these two here, but what industry 

value and present value is? 

That is the value of the industry which is currently shipping 31.5 million magnetic ballast. 

Unknown: 

Rivest: 

The value in terms that you're capitalizing your earnings? Or are these in terms of 

capitalization factors? That's what I don't understand. 

It's the revenue stream, what's left in your pocket at the end of the year in real cash 

money and after you've sold your product, paid you're suppliers, paid back the interest on 

your debt and that's what's left here. You're making income from operations 8.7 million 

97 
a year before financing and then you have the series of cash outlays. Which reduces your

net cash flow in the year. This just goes over a 12-year period. It's fairly standardized.

Unknown:

Is this summing the discounted cash flows for each year and that gives you the industry

values?

Rivest:

Yes.

Unknown:

So the present value factor the discount rate that you're using, is in this one.

Rivest:

That's a good point. Let me get to that. We looked at what determines the discount rate

for a specific company, their costs of capital, the weighted average cost of capital to really

sensitive to the debts/equity ratio. Right now, debt is really cheap. You can issue bonds

at 6-7 percent and you get your tax deduction 38-40 percent. Debt is really cheap right

now. I looked at manufacturers, I saw manufacturers at over 80% debt and I saw

manufacturers at 80% equity. That meant that their weighted average cost of capital

varies from four point something to eight - nine. In this case I think I used an industry

index that published by one of the financial firms like Dunn and Bradstreet. It was 8% or,

eight point something. But that would be up to each manufacturer to reflect or do a true

cost to capital.

Unknown:

Is that their cost of capital today with no standards, constant, whatever, whether they take

supplying shipments or constant shipments (not audible)?

Rivest:

Good point. I hadn't thought of that. That's true. If they don't become more highly

leveraged, that they are raising too much money then their cost of capital could go up. I

should probably have two inputs for cost of capital.

98

EE-RM-97-500 COMMENT 21OO

a year before financing and then you have the series of cash outlays. Which reduces your 

net cash flow in the year. This just goes over a 12-year period. It's fairly standardized. 

Unknown: 

Rivest: 

Is this summing the discounted cash flows for each year and that gives you the industry 

values? 

Yes. 

Unknown: 

Rivest: 

So the present value factor the discount rate that you're using, is in this one. 

That's a good point. Let me get to that. We looked at what determines the discount rate 

for a specific company, their costs of capital, the weighted average cost of capital to really 

sensitive to the debts/equity ratio. Right now, debt is really cheap. You can issue bonds 

at 6-7 percent and you get your tax deduction 38-40 percent. Debt is really cheap right 

now. I looked at manufacturers, I saw manufacturers at over 80% debt and I saw 

manufacturers at 80% equity. That meant that their weighted average cost of capital 

varies from four point something to eight - nine. In this case I think I used an industry 

index that published by one of the financial :firms like Dunn and Bradstreet. It was 8% or . 

eight point something. But that would be up to each manufacturer to reflect or do a true 

cost to capital. 

Unknown: 

Rivest: 

Is that their cost of capital today with no standards, constant, whatever, whether they take 

supplying shipments or constant shipments (not audible)? 

Good point. I hadn't thought of that. That's true. Ifthey don't become more highly 

leveraged, that they are raising too much money then their cost of capital could go up. I 

should probably have two inputs for cost of capital. 

98 
Unknown:

We're particular that we've thought about is (not audible) anticipate is that when you

compare it with or without standard you're going to have the extraordinary capital costs,

product conversion costs around the year of change. Maybe in one year or two years or

three years (not audible). Those will be extraordinary costs, it will be extraordinary

relative to the ongoing capital expenditure perhaps. That would have an enormous effect

on the cost of capital for that particular company.

Rivest:

Did he come in to that? Maybe he can't raise the capital.

Unknown:

That's precisely the issue, which we believe is the nub of the manufacturing impact

analysis. How affordable are these costs going to be and I would just point out that the

assumption of (not audible) explain where this number came from to not necessarily

realistic for the company that's under going the conversion costs.

Rivest:

Right at twenty million may be totally unacceptable for one manufacturer but totally

acceptable for another.

Unknown:

It would vary for the manufacturers but we have some manufacturers that are part of a full

time national conglomerate and other manufacturers that aren't.

Rivest:

I think what we will have to is bring this number in terms of the company level to bring

this number more in a relative fashion talked about change and return on equity. Change

and investment as percentage of existing equity.

Brookman:

Moving on towards a break here pretty quick. Any additional questions?

Unknown:

99

EE-RM-97-500 COMMENT 21OO

Unknown: 

Rivest: 

We're particular that we've thought about is (not audible) anticipate is that when you 

compare it with or without standard you're going to have the extraordinary capital costs, 

product conversion costs around the year of change. Maybe in one year or two years or 

three years (not audible). Those will be extraordinary costs, it will be extraordinary 

relative to the ongoing capital expenditure perhaps. That would have an enormous effect 

on the cost of capital for that particular company. 

Did he come in to that? Maybe he can't raise the capital. 

Unknown: 

Rivest: 

That's precisely the issue, which we believe is the nub of the manufacturing impact 

analysis. How affordable are these costs going to be and I would just point out that the 

assumption of (not audible) explain where this number came from to not necessarily 

realistic for the company that's under going the conversion costs. 

Right at twenty million may be totally unacceptable for one manufacturer but totally 

acceptable for another. 

Unknown: 

Rivest: 

It would vary for the manufacturers but we have some manufacturers that are part of a full 

time national conglomerate and other manufacturers that aren't. 

I think what we will have to is bring this number in terms of the company level to bring 

this number more in a relative fashion talked about change and return on equity. Change 

and investment as percentage of existing equity. 

Brookman: 

Moving on towards a break here pretty quick. Any additional questions? 

Unknown: 

99 
We have one other absolutely critical one, but I'm happy to do it after the break.

Brookman:

Howard you've been patient. What's the questions.

Wolfman:

This type of information, each individual company presuming this information provides it

to you indicates that it's not (not audible) information. Will you reserve the right to make

a decision based on that point or will you agree a new confidential information not

released to the individual company (not audible).

Brookman:

Would you please repeat the questions Howard?

Wolfman:

On the information we're just talking about, financial information, each company provides

that type of information, states that it is confidential information. Will you agree to hold

the company information confidential or do you reserve the right to reveal data and then

make some statements? We have no guarantee that you would hold it confidential.

Gene:

With all the data that's been collected today and (not audible)provided to our contractors

(not audible) not available to us and its certainly because it's not available through

Freedom of Information Act, as I understand it and we have been working all along with

this program. LBNL have been working with the (not audible) code. The reason that

information is correct has been provided and if I could (not audible) earlier (not audible)

He's going to have a strawman. He's going to be working with individuals firms (not

audible) or he can characterize it, as you have indicated as in a similar matter as how

Commerce does it. So that individual data are not (not audible) what I expect we will

have, to submit to, Dan Reicher , the decision maker, will be the same information which

will be published, in the technical support guide (not audible) and it's going to be that

aggregated data.

100

EE-RM-97-500 COMMENT 21OO

We have one other absolutely critical one, but I'm happy to do it after the break. 

Brookman: 

Howard you've been patient. What's the questions. 

Wolfman: 

This type of information, each individual company presuming this information provides it 

to you indicates that it's not (not audible) information. Will you reserve the right to make 

a decision based on that point or will you agree a new confidential information not 

released to the individual company (not audible). 

Brookman: 

Would you please repeat the questions Howard? 

Wolfman: 

Gene: 

On the information we're just talking about, financial information, each company provides 

that type of information, states that it is confidential information. Will you agree to hold 

the company information confidential or do you reserve the right to reveal data and then 

make some statements? We have no guarantee that you would hold it confidential. 

With all the data that's been collected today and (not audible)provided to our contractors 

(not audible) not available to us and its certainly because it's not available through 

Freedom ofInformation Act, as I understand it and we have been working all along with 

this program. LBNL have been working with the (not audible) code. The reason that 

information is correct has been provided and ifl could (not audible) earlier (not audible) 

He's going to have a strawman. He's going to be working with individuals firms (not 

audible) or he can characterize it, as you have indicated as in a similar matter as how 

Commerce does it. So that individual data are not (not audible) what I expect we will 

have, to submit to, Dan Reicher, the decision maker, will be the same information which 

will be published, in the technical support guide (not audible) and it's going to be that 

aggregated data. 

100 
Howard:

Let me rephrase the question. Each one of us furnishes the information to ADL. At what

point does that information get aggregated and ADL is the only ones who have the

individual company information . Are they appropriate vehicle for agreeing that that

information would be held confidential.

Rivest:

I have signed confidentiality agreements with manufacturers before and I would do that

with each of you.

Howard:

You would aggregate the data and from that point forward nobody would have an

opportunity to see the company data?

Rivest:

No. Agreed to (not audible).

Howard:

Then you spoke about Proxy's that could be used for aggregated data.

Rivest:

I don't even need to have your designer data , profit/cost information. I really only this

sheet which is already one little aggregation lower and that I would aggregate this and the

nice thing is everyone falls in the same accounting conventions . I'm just superimposing 5

or 6 of these collapsing them into one. But then I still need to be able to explain and come

up with a good analysis of how some manufacturers are way different from others (not

audible).

Brookman:

Does that answer your question?

Howard:

Yes, but the answer could have been shorter.

Brookman:

1 0 1

EE-RM-97-500 COMMENT 21OO

Howard: 

Rivest: 

Let me rephrase the question. Each one of us furnishes the information to ADL. At what 

point does that information get aggregated and ADL is the only ones who have the 

individual company information. Are they appropriate vehicle for agreeing that that 

information would be held confidential. 

I have signed confidentiality agreements with manufacturers before and I would do that 

with each of you. 

Howard: 

Rivest: 

You would aggregate the data and from that point forward nobody would have an 

opportunity to see the company data? 

No. Agreed to (not audible). 

Howard: 

Rivest: 

Then you spoke about Proxy's that could be used for aggregated data. 

I don't even need to have your designer data, profit/cost information. I really only this 

sheet which is already one little aggregation lower and that I would aggregate this and the 

nice thing is everyone falls in the same accounting conventions. I'mjust superimposing 5 

or 6 of these collapsing them into one. But then I still need to be able to explain and come 

up with a good analysis of how some manufacturers are way different from others (not 

audible). 

Brookman: 

Does that answer your question? 

Howard: 

Yes, but the answer could have been shorter. 

Brookman: 

101 
Everybody's been real patient about the break. We've covered a lot of ground here. Let's

take a break at this point. It's now almost 3:30. Let's start at 3:40. Thank you very

much. We're doing great here.

Brookman:

Bob raised an issue, I can't tell which one. Bob do you want to raise the issue that you

were kind enough to defer until after the break?

Wisbey:

The questions that I wanted to ask has to do with the whole issue of the confidentiality

data because obviously in order to comply with the data requests we will have to supply

data that most of us are very concerned about the kind of confidential data, we normally,

confidential financial data that we normally don't supply at all. The review of the

manufacturer impacts that the department in the end as my understanding is the valuation

is look at whether or not they're unacceptable impacts on individual manufacturers. The

answer that was given to Howard's question was that by the time the department received

the data it would be totally aggregated for the industry to become very confused how the

department analyzed the impacts since the impacts as I understand it are primarily intended

to be on individual manufacturers.

McCabe:

(Not audible)look at it in tag team managers with the two of us, but as far as the data that

would be collected and reported from the industry status quo is aggregated so that they

would not be anything manufacturers(not audible) individual firm impacts at this point is

hard to describe that because we don't, haven't seen it, we don't know what they're going

to be. Looking at the individual data will start to characterize it in a way the (not audible).

There will be ways that you take that data, that if there were two firms that were going to

be impacted more significantly than anyone else in the industry. To be able to talk about

that impact in a general fashion that gets the sense of the impact request with the sensitive

information.

102

EE-RM-97-500 COMMENT 21OO

Everybody's been real patient about the break. We've covered a lot of ground here. Let's 

take a break at this point. It's now almost 3:30. Let's start at 3:40. Thank you very 

much. We're doing great here. 

Brookman: 

Bob raised an issue, I can't tell which one. Bob do you want to raise the issue that you 

were kind enough to defer until after the break? 

Wisbey: 

The questions that I wanted to ask has to do with the whole issue of the confidentiality 

data because obviously in order to comply with the data requests we will have to supply 

data that most of us are very concerned about the kind of confidential data, we normally, 

confidential financial data that we normally don't supply at all. The review ofthe 

manufacturer impacts that the department in the end as my understanding is the valuation 

is look at whether or not they're unacceptable impacts on individual manufacturers. The 

answer that was given to Howard's question was that by the time the department received 

the data it would be totally aggregated for the industry to become very confused how the 

department analyzed the impacts since the impacts as I understand it are primarily intended 

to be on individual manufacturers. 

McCabe: 

(Not audible)look at it in tag team managers with the two of us, but as far as the data that 

would be collected and reported from the industry status quo is aggregated so that they 

would not be anything manufacturers(not audible) individual firm impacts at this point is 

hard to describe that because we don't, haven't seen it, we don't know what they're going 

to be. Looking at the individual data will start to characterize it in a way the (not audible). 

There will be ways that you take that data, that if there were two firms that were going to 

be impacted more significantly than anyone else in the industry. To be able to talk about 

that impact in a general fashion that gets the sense of the impact request with the sensitive 

information. 

102 
Rivest:

I think its going to be an interactive process whereby I will, first of all, I can make up

some dummy numbers and show you how I might report them. One way would be for

example to talk about number of manufacturers positively impacted and number negatively

impacted. The range of impacts in terms of absolute dollars or in terms of loss of

percentage return on equity for example . A range is loss in total asset base, something

like that. I think from the departments side the more we can publish the better . So really

it's going to be sitting with all of you and seeing what you're comfortable with. We'll

have creative in how we report it. That's our job, but we'll also go back and forth with

you and say, "ok this is the level we're comfortable with or we're willing to go further." I

think I understand the dynamics that there are many manufacturers who make magnetic

ballast's and two that don't. I can guess where things are going to fall out. Some are

bigger than others. I think in the next few weeks as we talk we'll have to come up with

some Strawman exhibits of results is what we should do. I think the aggregate cash flow

is going to tell us something as well.

McCabe:

Mike you could also, I would encourage individual firms to do their own GRIM analysis

and instead of reporting the cash flow, talk about the standard at a particular level will

result in our cash flow changing in this direction. We'll just take the results and

characterize them in a meaningful fashion without reviewing the information itself.

Rivest:

You mean it would go on the record to say that they're are negatively impacted?

Brookman:

A few very brief housekeeping items, before we move on to the rest of the agenda for the

afternoon. First and foremost, if Virginia Allen is here, it is requested that you call your

office and do it quickly. Anybody, who knows if she's here, we need to find her it says

urgent on this. Also, Sandy and Brenda have additional copies of the diskettes for the

103

EE-RM-97-500 COMMENT 21OO

Rivest: 

I think its going to be an interactive process whereby I will, first of all, I can make up 

some dummy numbers and show you how I might report them. One way would be for 

example to talk about number ofmanufacturers positively impacted and number negatively 

impacted. The range of impacts in terms of absolute dollars or in terms of loss of 

percentage return on equity for example. A range is loss in total asset base, something 

like that. I think from the departments side the more we can publish the better. So really 

it's going to be sitting with all of you and seeing what you're comfortable with. We'll 

have creative in how we report it. That's our job, but we'll also go back and forth with 

you and say, "ok this is the level we're comfortable with or we're willing to go further." I 

think I understand the dynamics that there are many manufacturers who make magnetic 

ballast's and two that don't. I can guess where things are going to fall out. Some are 

bigger than others. I think in the next few weeks as we talk we'll have to come up with 

some Strawman exhibits of results is what we should do. I think the aggregate cash flow 

is going to tell us something as well. 

McCabe: 

Rivest: 

Mike you could also, I would encourage individual:firms to do their own GRIM analysis 

and instead of reporting the cash flow, talk about the standard at a particular level will 

result in our cash flow changing in this direction. We'll just take the results and 

characterize them in a meaningful fashion without reviewing the information itself. 

You mean it would go on the record to say that they're are negatively impacted? 

Brookman: 

A few very brief housekeeping items, before we move on to the rest of the agenda for the 

afternoon. First and foremost, if Virginia Allen is here, it is requested that you call your 

office and do it quickly. Anybody, who knows if she's here, we need to find her it says 

urgent on this. Also, Sandy and Brenda have additional copies of the diskettes for the 

103 
NES spreadsheet for those who didn't obtain a copy they are now available over there at

the registration table . And Barbara has an announcement to make about using Excel.

Barbara Atkinson:

Simply we've tried to make the spreadsheet compatible with various versions of Excel and

if you have a problem, the best thing would be, is to contact Peter Chan whose phone

number 510-486-6510.

Unknown:

What version of Excel?

Atkinson:

We use Windows 95 7.0 version apparently the newer version works with windows 97 as

well.

Perlis:

For any questions you got a telephone number or you can call Sandy or Brenda and they

will get you the telephone number you need.

McCabe:

Any other housekeeping items before we proceed?

Perlis:

Bob asked a procedural question how the department(not audible) work together to

evaluate (not audible). I wonder if you could address the substance that will be (not

audible). How is the department going to decide what is or is not (not audible) cash flow.

One obvious question are you going to emphasize the difference in the whole industry at

present values before and after standards to see whether or not that's positive or negative?

Is that going to be where the focus is? Is it going to be one how acceptable a one-time

extraordinary conversion price will be relative to non-relative normal cash flow (not

audible)? How are we going to decide whether or not obvious (not audible) impact are

severe or not?

McCabe:

104

EE-RM-97-500 COMMENT 21OO

NBS spreadsheet for those who didn't obtain a copy they are now available over there at 

the registration table. And Barbara has an announcement to make about using Excel. 

Barbara Atkinson: 

Simply we've tried to make the spreadsheet compatible with various versions of Excel and 

if you have a problem, the best thing would be, is to contact Peter Chan whose phone 

number 510-486-6510. 

Unknown: 

What version of Excel? 

Atkinson: 

Pedis: 

We use Windows 957.0 version apparently the newer version works with windows 97 as 

well. 

For any questions you got a telephone number or you can call Sandy or Brenda and they 

will get you the telephone number you need. 

McCabe: 

Pedis: 

Any other housekeeping items before we proceed? 

Bob asked a procedural question how the department(not audible) work together to 

evaluate (not audible). I wonder if you could address the substance that will be (not 

audible). How is the department going to decide what is or is not (not audible) cash flow. 

One obvious question are you going to emphasize the difference in the whole industry at 

present values before and after standards to see whether or not that's positive or negative? 

Is that going to be where the focus is? Is it going to be one how acceptable a one-time 

extraordinary conversion price will be relative to non-relative normal cash flow (not 

audible)? How are we going to decide whether or not obvious (not audible) impact are 

severe or not? 

McCabe: 

104 
Mark, I can't answer the questions because I don't know. I don't know what the decision

(not audible) how their going to weigh? Because the energy savings that are anticipated,

will be weighed against change in jobs, weighed against environmental impact. What

those results look like and the individuals who are going to be making the decision will all

come into play and how they, Dan Reicher for example, how he's going to go through this

process (not audible). (Not audible) information present it to them, we will explain what

we consider to be significant, why we consider it to be significant but if history will run its

course. We've done this in the past with other rulemaking. Decision-makers will based

on your own background experiences and what have you, we'll go back and present

additional detailed information (not audible). Everyone has been different. Different

factors in the (not audible). I think the one thing that's going to be arguably different, (not

audible), is ballast and other product (not audible) impact (not audible) very significant

one time conversion cost dependent to the (not audible) products, the fact that the facility

or (not audible). I'm not aware that that's come up in prices (not audible).

Unknown:

I didn't ask the question to ask how Dan Reicher would even use, to put manufacturer

impact into a larger context of the ruling. I'm just hoping to focus a little bit (not audible)

on how one evaluates the manufacture impacts by itself. Whether to it's significant or not.

Things we talked about among ourselves, we don't have well-developed news on this or

going to, one thing is we have this present value. We might (not audible) focus on the

change present value that instead is considered (not audible) such as what would be

extraordinary cost and how they stack up relative to income. What does a company do

when it suffers a loss for a year or two? (Not audible) recovers it over 15 years (not

audible) product that they go into to try. How do we begin to, what are we going to

compare our (not audible) to determine whether or not it's a significant impact or not.

(Not audible). And I think that it is certainly an area where Mike (not audible). Just

focusing on the spreadsheet, while very useful, tends to obscure what may turn out to be

105

EE-RM-97-500 COMMENT 21OO

Mark, I can't answer the questions because I don't know. I don't know what the decision 

(not audible) how their going to weigh? Because the energy savings that are anticipated, 

will be weighed against change injobs, weighed against environmental impact. What 

those results look like and the individuals who are going to be making the decision will all 

come into play and how they, Dan Reicher for example, how he's going to go through this 

process (not audible). (Not audible) information present it to them, we will explain what 

we consider to be significant, why we consider it to be significant but ifhistory will run its 

course. We've done this in the past with other rulemaking. Decision-makers will based 

on your own background experiences and what have you, we'll go back and present 

additional detailed information (not audible). Everyone has been different. Different 

factors in the (not audible). I think the one thing that's going to be arguably different, (not 

audible), is ballast and other product (not audible) impact (not audible) very significant 

one time conversion cost dependent to the (not audible) products, the fact that the facility 

or (not audible). I'm not aware that that's come up in prices (not audible). 

Unknown: 

I didn't ask the question to ask how Dan Reicher would even use, to put manufacturer 

impact into a larger context of the ruling. I'm just hoping to focus a little bit (not audible) 

on how one evaluates the manufacture impacts by itself. Whether to it's significant or not. 

Things we talked about among ourselves, we don't have well-developed news on this or 

going to, one thing is we have this present value. We might (not audible) focus on the 

change present value that instead is considered (not audible) such as what would be 

extraordinary cost and how they stack up relative to income. What does a company do 

when it suffers a loss for a year or two? (Not audible) recovers it over 15 years (not 

audible) product that they go into to try. How do we begin to, what are we going to 

compare our (not audible) to determine whether or not it's a significant impact or not. 

(Not audible). And I think that it is certainly an area where Mike (not audible). Just 

focusing on the spreadsheet, while very useful, tends to obscure what may turn out to be 

105 
the most important factor ofall which is looking at these one-time cost and figuring out

how you compare those to the 15 year recovery of the cost (not audible) ballast's.

Unknown:

Can you offer? I'm just going to spend a few minutes because we 're running behind

schedule just to make you familiar with the interface with the spreadsheet and we've

already looked at most of the pages already. We'll go down the tabs are on the bottom.

Major assumptions, that's (not audible) basic financial information. Can you go down a

little bit here?

Rivest:

One very, very critical variable that I'll need more input on here is what is the size of that

investment necessary to change production from magnetic to electronic.

Unknown:

This is one critical input and Mike; can you go down this tab and go to cash flow? What

we have been seeing in the photocopies that you have is that there is some samples, no, go

to the exhibits, the graphs, there.

Rivest:

For example, this reports the cash flow investment relative to the net cash flow in normal

years. You see the impact of the standard would be an enormous large cash drain.

Eventually, like you said, over 15 years, you get it all back. So the end (not audible) may

not reflect that, that well because it does to an extent, discounts these. But certainly

what's different from the GRIM from the old model is that that old model that's all you

have, is change in return on equity. Here you do see these temporal changes and that's

something you have to focus your analysis on when you sit down with the manufacturer,

you say, ok where are you going to raise your capital from?

Adams:

This is the last page of the mock (not audible) of the GRIM handout?

106

EE-RM-97-500 COMMENT 21OO

the most important factor of all which is looking at these one-time cost and figuring out 

how you compare those to the 15 year recovery of the cost (not audible) ballast's. 

Unknown: 

Rivest: 

Can you offer? I'mjust going to spend a few minutes because we're running behind 

schedule just to make you familiar with the interface with the spreadsheet and we've 

already looked at most ofthe pages already. We'll go down the tabs are on the bottom. 

Major assumptions, that's (not audible) basic financial information. Can you go down a 

little bit here? 

One very, very critical variable that I'll need more input on here is what is the size of that 

investment necessary to change production from magnetic to electronic. 

Unknown: 

Rivest: 

This is one critical input and Mike; can you go down this tab and go to cash flow? What 

we have been seeing in the photocopies that you have is that there is some samples, no, go 

to the exhibits, the graphs, there. 

For example, this reports the cash flow investment relative to the net cash flow in normal 

years. You see the impact of the standard would be an enormous large cash drain. 

Eventually, like you said, over 15 years, you get it all back. So the end (not audible) may 

not reflect that, that well because it does ,to an extent, discounts these. But certainly 

what's different from the GRIM from the old model is that that old model that's all you 

have, is change in return on equity. Here you do see these temporal changes and that's 

something you have to focus your analysis on when you sit down with the manufacturer, 

you say, ok where are you going to raise your capital from? 

Adams: 

This is the last page of the mock (not audible) ofthe GRIM handout? 

106 
Rivest:

Yes. We just don't have the (not audible)

Adams:

The last page of the package is titled GRIM.

Rivest:

Right.

Unknown:

(Not audible)

Rivest:

The critical question is well, the government is imposing a cost of 150-700 million,

thousands, whatever. The base million, 157 million dollars. Which is, I give you an

example, is a hundred time, not a hundred times, but 20 times the ordinary capital (not

audible) some huge percent that's relative to your normal income similar to 20 times your

net income.

Unknown:

How does anybody evaluate the (not audible)?

Unknown:

The Chairman of the Board, what was the shareholders, what's Wall Street going to say?

Rivest:

I guess we'd like to engage in a dialogue to think about what we're going to do with that

number, because that's the critical, that is a very, very critical number and I don't think it"s

one that you had to evaluate quite so distinctly as part of the (not audible).

Unknown:

Final rules for laundry products in 1991, you analyzed the potential efficiency levels (not

audible) presented to the decision makers (not audible) where we see some unusual factors

outside of the ordinary that we will in the past have presented (not audible) so that

certainly a range of information that's typically presented energy savings, impact on the

107

EE-RM-97-500 COMMENT 21OO

Rivest: 

Yes. We just don't have the (not audible) 

Adams: 

The last page of the package is titled GRIM. 

Rivest: 

Right. 

Unknown: 

Rivest: 

(Not audible) 

The critical question is well, the government is imposing a cost of 150-700 million, 

thousands, whatever. The base million, 157 million dollars. Which is, I give you an 

example, is a hundred time, not a hundred times, but 20 times the ordinary capital (not 

audible) some huge percent that's relative to your normal income similar to 20 times your 

net income. 

Unknown: 

How does anybody evaluate the (not audible)? 

Unknown: 

Rivest: 

The Chairman of the Board, what was the shareholders, what's Wall Street going to say? 

I guess we'd like to engage in a dialogue to think about what we're going to do with that 

number, because that's the critical, that is a very, very critical number and I don't think it's 

one that you had to evaluate quite so distinctly as part of the (not audible). 

Unknown: 

Final rules for laundry products in 1991, you analyzed the potential efficiency levels (not 

audible) presented to the decision makers (not audible) where we see some unusual factors 

outside of the ordinary that we will in the past have presented (not audible) so that 

certainly a range of information that's typically presented energy savings, impact on the 

107 
environment so the aggregate numbers (not audible). Each standard level for the most

part shows a lot of incremental impacts (not audible) those incremental impacts, the

investment structure of (not audible) energy savings (not audible) larger impacts are going

to be significantly larger. What I've always found to be particularly noteworthy for

discussion has been where the slope changes and you take that's a point of particular note

because you have a change. That change is on a slope or some other significant impact is

subject of scenario that we have in the past (not audible) to focus on.

Rivest:

That's certainly the one (not audible) is that is an excellent questions and should be on the

questionnaire and I don't even know if it is right now. I would first draft questionnaire

and the answer I'm sure, is going to be different from Motorola than it will be from

Robertson. Motorola is huge, that's probably not a problem they issue bonds actually

shares, they'll just have to issue more shares and they'll have no problem to come into the

market. Different issue with MagneTek maybe and with Robertson. So I think that that's

certainly something that will be (not audible) specific.

Unknown:

I think Motorola; (not audible) you don't see any spike at all because as you mentioned

they make electronics so we'd actually see a spike going in the other direction.

Unknown:

They would also have to fork out the cash.

Unknown:

But their capacity is 100% electronic. So you build electronic standard into effect but

can't say that they haven't made additional capital investments to take into account the

standards that they only make ballast now which meets ...

Unknown:

But they're going to provide a cash flow which has zero revenues for magnetic and they'll

have positive cash flow for electronic.

108

EE-RM-97-500 COMMENT 21OO

Rivest: 

environment so the aggregate numbers (not audible). Each standard level for the most 

part shows a lot of incremental impacts (not audible) those incremental impacts, the 

investment structure of (not audible) energy savings (not audible) larger impacts are going 

to be significantly larger. What I've always found to be particularly noteworthy for 

discussion has been where the slope changes and you take that's a point of particular note -

because you have a change. That change is on a slope or some other significant impact is 

subject of scenario that we have in the past (not audible) to focus on. 

That's certainly the one (not audible) is that is an excellent questions and should be on the 

questionnaire and I don't even know if it is right now. I would first draft questionnaire 

and the answer I'm sure, is going to be different from Motorola than it will be from 

Robertson. Motorola is huge, ~hat's probably not a problem they issue bonds actually 

shares, they'll just have to issue more shares and they'll have no problem to come into the 

market. Different issue with MagneTek maybe and with Robertson. So I think that that's 

certainly something that will be (not audible) specific. 

Unknown: 

I think Motorola; (not audible) you don't see any spike at all because as you mentioned 

they make electronics so we'd actually see a spike going in the other direction. 

Unknown: 

They would also have to fork out the cash. 

Unknown: 

But their capacity is 100% electronic. So you build electronic standard into effect but 

can't say that they haven't made additional capital investments to take into account the 

standards that they only make ballast now which meets ... 

Unknown: 

But they're going to provide a cash flow which has zero revenues for magnetic and they'll 

have positive cash flow for electronic. 

108 
Unknown:

(Not audible)

Unknown:

As a dog in this fight, (not audible)

Wolfinan:

I think any company, I don't care how big they are, will come down to individual business

risks and they have to justify anything they are going to spend on an individual business

risks. We would have to look at the growth and expansion in capacity on an individual

business unit basis and (not audible) certainly justify the fact that we need to invest in

more facilities, more capital because even if we maintain the same market share, if it's a

larger market we need more facilities to make the product. We would have to spend some

money, yes. But we don't' have deep pockets that are over flowing with cash. This

business decision like any other decision is growth market. Any one of us who put in

additional capacity over the last 5 years has had to make those decisions.

Treado:

But hopefully it's Motorola's decision. It's not your bankers' decision. Because that may

be the situation that some people who would love to get in the market but they just don't

have the money and you don't have the borrowing capacity because they are already

leveraged.

Divest:

That's how they choose to run their business?

Treado:

(Not audible) in the case of Motorola as an example. In one case investment that you

make because you have a product that you have been making is now off (not audible) you

want to make product which can be, which meets the standards. First is, in Motorola's

case where they actually wouldn't have to do anything, they could just keep doing what

109

EE-RM-97-500 COMMENT 21OO

Unknown: 

(Not audible) 

Unknown: 

As a dog in this fight, (not audible) 

Wolfman: 

I think any company, I don't care how big they are, will come down to individual business 

risks and they have to justify anything they are going to spend on an individual business 

risks. We would have to look at the growth and expansion in capacity on an individual 

business unit basis and (not audible) certainly justify the fact that we need to invest in 

more facilities, more capital because even if we maintain the same market share, if it's a 

larger market we need more facilities to make the product. We would have to spend some 

money, yes. But we don't' have deep pockets that are over flowing with cash. This 

business decision like any other decision is growth market. Anyone of us who put in 

additional capacity over the last 5 years has had to make those decisions. 

Treado: 

Rivest: 

But hopefully it's Motorola's decision. It's not your bankers' decision. Because that may 

be the situation that some people who would love to get in the market but they just don't 

have the money and you don't have the borrowing capacity because they are already 

leveraged. 

That's how they choose to run their business? 

Treado: 

(Not audible) in the case of Motorola as an example. In one case investment that you 

make because you have a product that you have been making is now off (not audible) you 

want to make product which can be, which meets the standards. First is, in Motorola's 

case where they actually wouldn't have to do anything, they could just keep doing what 

109 
they are doing now. What they choose to try to meet the higher demand, is that

considered ........

Unknown:

It's an investment to me. I have two, thirty million dollars.....

Beebee:

A negative impact on a company like that.......

Rivest:

They may say that it's a positive and if they choose to answer the market they make view

this as a positive development because they are losing nothing and they're gaining, let's

say they have 25% market share of the electronic ballast's market. Today that is zero, the

magnetic. So if they maintain their marketshare of electronic they are going to have build

up capacity and may make money on that.

Hagen:

That may not be considered actually negative thing as, negative impact for them although

it is obviously an investment (not audible) just curious how you were able to distinguish

between those two classes of investments or if that (not audible).

Rivest:

I don't think that's important.

Beebee:

I just wanted to bring up the point, I think what's not being mentioned is that in the case

of the existing manufacturers, you're talking about writing off unamortized investments.

As opposed to investing in new opportunity.

Rivest:

Or to stated another way, they way this is captured, you have assets there already

generating cash and its being cut off. So you're 100 million dollars in assets are written to

zero and you're having to build up capacity for the full 400. You're losing the cash flow

you had and then you're getting a new cash flow whereas at Motorola which is the. They

110

EE-RM-97-500 COMMENT 21OO

they are doing now. What they choose to try to meet the higher demand, is that 

considered ....... . 

Unknown: 

It's an investment to me. I have two, thirty million dollars ..... 

Beebee: 

Rivest: 

Hagen: 

Rivest: 

A negative impact on a company like that.. ..... 

They may say that it's a positive and if they choose to answer the market they make view 

this as a positive development because they are losing nothing and they're gaining, let's 

say they have 25% market share ofthe electronic ballast's market. Today that is zero, the 

magnetic. So if they maintain their marketshare of electronic they are going to have build 

up capacity and may make money on that. 

That may not be considered actually negative thing as, negative impact for them although 

it is obviously an investment (not audible) just curious how you were able to distinguish 

between those two classes of investments or if that (not audible). 

I don't think that's important. 

Beebee: 

Rivest: 

I just wanted to bring up the point, I think what's not being mentioned is that in the case 

of the existing manufacturers, you~re talking about writing offunamortized investments. 

As opposed to investing in new opportunity. 

Or to stated another way, they way this is captured, you have assets there already 

generating cash and its being cut off. So you're 100 million dollars in assets are written to 

zero and you're having to build up capacity for the full 400. You're losing the cash flow 

you had and then you're getting a new cash flow whereas at Motorola which is the. They 

110 
start from zero, they don't' start from plus 7 million dollars. I just want to take a second

and show you the link to the next spreadsheet. There's one tab that's called mass

shipments. What this does right now since its configured as an industry cash flow it just

takes the shipments right out of the net spreadsheet and it places shipment values for the

whole industry. So you open up both spreadsheets and you can go change your scenario

for shipments and just change the first one to 100% by 2012. Return to the other

spreadsheet and then we've just made the two spreadsheets correspond so that the

National Energy Savings are calculating on the same basis as the manufacturing impacts

you've calculated. Go to the input space case. This is just a spreadsheet that's used to

input this aggregated price cost information and shipments information. Since these

values for example are the unit sales. All these values here are placeholders individual

manufacturers can just go overwrite . I think right now if you write a value in the year

1998 it just replicates down, but you can go change all your values for your own situation.

You could do it simply by just assuming, multiplying the market by marketshares before

standards and after standards on the left and on the right, whatever you choose to do. The

input standard case is just the shipment information counted from the (not audible ) for the

standards case. Right now it's the same price information , this aggregate same (not

audible). Then everything is base case, if you could go to the next tab. This is just the

aggregation of the all the product classes for the base case . What's the value on this one?

100 million? I'm just kidding, no, no don't bother. I'd rather not in fact. And then the

standards case . Here we've put in just a dummy value, a placeholder value for the

necessary investments. I think I put 50 cents per electronic ballast's but that would be 50

cents times the number of years. So that could be as much as $5-$7 or something like

that. Then I've got a capital conversion expenditures coming in based on whatever

shipments were that are converted over to electronic in the year the standards comes into

effect. From my experience it takes playing around with this for at least 4 hours to find

out all the faulty assumptions.

111

EE-RM-97-500 COMMENT 21OO

start from zero, they don't' start from plus 7 million dollars. I just want to take a second 

and show you the link to the next spreadsheet. There's one tab that's called mass 

shipments. What this does right now since its configured as an industry cash flow it just 

takes the shipments right out of the net spreadsheet and it places shipment values for the 

whole industry. So you open up both spreadsheets and you can go change your scenario 

for shipments and just change the first one to 100% by 2012. Return to the other 

spreadsheet and then we've just made the two spreadsheets correspond so that the 

National Energy Savings are calculating on the same basis as the manufacturing impacts 

you've calculated. Go to the input space case. This is just a spreadsheet that's used to 

input this aggregated price cost information and shipments information. Since these 

values for example are the unit sales. All these values here are placeholders individual 

manufacturers can just go overwrite. I think right now if you write a value in the year 

1998 it just replicates down, but you can go change all your values for your own situation. 

You could do it simply by just assuming, multiplying the market by marketshares before 

standards and after standards on the left and on the right, whatever you choose to do. The 

input standard case is just the shipment information counted from the ( not audible) for the 

standards case. Right now it's the same price information, this aggregate same (not 

audible). Then everything is base case, if you could go to the next tab. This is just the 

aggregation ofthe all the product classes for the base case. What's the value on this one? 

100 million? I'mjust kidding, no, no don't bother. I'd rather not in fact. And then the 

standards case. Here we've put injust a dummy value, a placeholder value for the 

necessary investments. I think I put 50 cents per electronic ballast's but that would be 50 

cents times the number of years. So that could be as much as $5-$7 or something like 

that. Then I've got a capital conversion expenditures coming in based on whatever 

shipments were that are converted over to electronic in the year the standards comes into 

effect. From my experience it takes playing around with this for at least 4 hours to find 

out all the faulty assumptions. 

111 
Hagen:

You have a couple of Excel spreadsheets and obviously they are going to go through

future revisions. Is it possible to put those up on the Web so we can have (not audible)?

Rivest:

Yes. Especially that this version is working off an earlier version of the net spreadsheet

when they are both updated we'll have them on the Web. I think we could do that within

a week or two. And then the outputs are shown graphically for various things. If you

could just move down. That's the cash flow, the NPV before and after standards for the

whole industry. Just showing the income (not audible). The big assumption now is that

the product classes are all electronic T4, T12's and the information that we have on

prices, the prices are quite high compared to T8's. That's why you see a large increase in

income. Less of more expensive ballasts are being sold. That's the last one is your net

income. Your shipments. You see the quality of shipments decrease, price, and the

average price of ballasts. And the investments so they are the mirror image of cash flow.

They will be ready in a couple of weeks, they'll be up on the Web and you'll need some

playing around with. My plan is within the next six weeks to be working with all of you

and getting better placeholder values. Maybe changing some parameters, changing some

of the input function if we need to, to make things a little, there's always a trade off here

between trying to think of everything that could possibly happen in advance and making it

easy to input but then you might lose some flexibility. We can work on that in the next

few weeks. That's it for that.

Unknown:

I'd like to caution everybody with pulling spreadsheets off the Web that we do have some

up already for other rulemakings which are in progress fot example (not audible). Don't

pull that one off by mistake. In addition LBNL will be putting the same ones on their

web sit as (not audible)

112

EE-RM-97-500 COMMENT 21OO

Hagen: 

Rivest: 

You have a couple of Excel spreadsheets and obviously they are going to go through 

future revisions. Is it possible to put those up on the Web so we can have (not audible)? 

Yes. Especially that this version is working off an earlier version of the net spreadsheet 

when they are both updated we'll have them on the Web. I think we could do that within 

a week or two. And then the outputs are shown graphically for various things. If you 

could just move down. That's the cash flow, the NPV before and after standards for the 

whole industry. Just showing the income (not audible). The big assumption now is that 

the product classes are all electronic T4, T12's and the information that we have on 

prices, the prices are quite high compared to TS's. That's why you see a large increase in 

income. Less of more expensive ballasts are being sold. That's the last one is your net 

income. Your shipments. You see the quality of shipments decrease, price, and the 

average price of ballasts. And the investments so they are the mirror image of cash flow. 

They will be ready in a couple of weeks, they'll be up on the Web and you'll need some 

playing around with. My plan is within the next six weeks to be working with all of you 

and getting better placeholder values. Maybe changing some parameters, changing some 

of the input function ifwe need to, to make things a little, there's always a trade off here 

between trying to think of everything that could possibly happen in advance and making it 

easy to input but then you might lose some flexibility. We can work on that in the next 

few weeks. That's it for that. 

Unknown: 

I'd like to caution everybody with pulling spreadsheets off the Web that we do have some 

up already for other rulemakings which are in progress fot example (not audible). Don't 

pull that one offby mistake. In addition LBNL will be putting the same ones on their 

web sit as (not audible) 

112 
Wolfinan:

Most of us I think have our e-mail addresses on our business cards. Can you send out a

notice to us and tell us when these spreadsheets are available specifically what they are

called so we can then go get them when we get the right (not audible)?

Rivest:

Sure. I'll set up a group mail.

McCabe:

The next part of the Agenda was to talk about. Following up on Howard's suggestion

that if your e-mail address is not on your business card that you could e-mail DOE for the

announcement. Brenda Jones email address is included in the further information contacts

column on the announcement. Email her so that she would note that in the data file.

Rivest:

I have here a subgroup analysis consists of 5 tasks, the individual manufacturers cash

flows, estimating the competitive impacts, the employment's impacts, the impacts on

manufacturing capacity and finality reporting the subgroup analysis impacts. Seems we've

touched on all this by now. We realized after our preliminary interviews that there's no

such thing as a pro-typical manufacturer so any cash flow we would differ the industry

would not be applicable to individual manufacturers. We plan on meeting with individual

manufacturers, even modifying the spreadsheet to some extent if its required for the (not

audible) situation. All along we'll try to document any important variances that there

might be between our Strawman values and the particular values that we see have

manufacturer visits. We haven't talked at all about the competitive impact assessment.

We have not met recently with the DoJ certainly not on ballasts. I anticipate that we'll be

meeting with DoJ to finalize the energy questionnaire that Quentin will be talking about in

a few minutes. And the idea here is that we want DoJ to tell us what their concerns might

be. We'll explain the situation to them and we want to make sure that any information

113

EE-RM-97-500 COMMENT 21OO

Wolfman: 

Rivest: 

Most of us I think have our e-mail addresses on our business cards. Can you send out a 

notice to us and tell us when these spreadsheets are available specifically what they are 

called so we can then go get them when we get the right (not audible)? 

Sure. I'll set up a group mail. 

McCabe: 

Rivest: 

The next part ofthe Agenda was to talk about. Following up on Howard's suggestion 

that if your e-mail address is not on your business card that you could e-mail DOE for the 

announcement. Brenda Jones email address is included in the further information contacts 

column on the announcement. Email her so that she would note that in the data file. 

I have here a subgroup analysis consists of 5 tasks, the individual manufacturers cash 

flows, estimating the competitive impacts, the employment's impacts, the impacts on 

manufacturing capacity and finality reporting the subgroup analysis impacts. Seems we've 

touched on all this by now. We realized after our preliminary interviews that there's no 

such thing as a pro-typical manufacturer so any cash flow we would differ the industry 

would not be applicable to individual manufacturers. We plan on meeting with individual 

manufacturers, even modifying the spreadsheet to some extent ifits required for the (not 

audible) situation. All along we'll try to document any important variances that there 

might be between our Strawman values and the particular values that we see have 

manufacturer visits. We haven't talked at all about the competitive impact assessment. 

We have not met recently with the DoJ certainly not on ballasts. I anticipate that we'll be 

meeting with DoJ to finalize the energy questionnaire that Quentin will be talking about in 

a few minutes. And the idea here is that we want DoJ to tell us what their concerns might 

be. We'll explain the situation to them and we want to make sure that any information 

113 
they need we will be able to gather for them to make their job easier and for our analysis

to be better. Reading out their own horizontal merger guidelines, their concerns are

addressed mostly to smaller significant manufacturers. They'll be involved in drafting of

any questions that is relevant to their analysis section and all along they'll be concerned

about asymmetrical cost increases to some manufacturers, increased proportions to fixed

costs potentially increasing business risk such as some of your issues. One thing we have

not talked about, market entry and market exit. This is not necessarily in the context of

the DoJ analysis, but there's always the possibility that a large new market with a track

new entrance and that certainly the way we've talked so far would not be factored into the

cash flow. We would need to have a qualitative discussion of what might be the impact of

a new entrant on the existing players. For employment impacts, we plan on gathering

employment levels at existing plants particularly those that serve that US market existing

data and manufacturing abuse will be used to estimate employment level differences

between the different standard levels. Interviews will be used to establish differences in

work force skills under different levels of energy of efficiency standards. At DoE

interviews, manufacturers will establish likely impact of new efficiency standards on the

product mix and employment levels. One thing we really need to improve I think in the

Strawman is understanding what the levels of investments to convert over those 30 million

ballast's that's going to be and the extent to which any equipment, though I have my own

doubts about that, can be reused and also try to understand some of the more.structural

changes that may happen on product mix and how although we're only tracking those

immediate ballasts that are being impacted, there may be some other effects on product

mix or secondary effect. One thing we found about it is what happens if there's suddenly

this large production capacity available for producing magnetic ballasts. What happens to

people who produce residential ballasts? What would be the impact there if that market

becomes more competitive? So that's sort of secondary yet not trivial impact. We put

together a very preliminary interview guide. It has as its purpose to do two things really.

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EE-RM-97-500 COMMENT 21OO

they need we will be able to gather for them to make their job easier and for our analysis 

to be better. Reading out their own horizontal merger guidelines, their concerns are 

addressed mostly to smaller significant manufacturers. They'll be involved in drafting of 

any questions that is relevant to their analysis section and all along they'll be concerned 

about asymmetrical cost increases to some manufacturers, increased proportions to :fixed 

costs potentially increasing business risk such as some of your issues. One thing we have 

not talked about, market entry and market exit. This is not necessarily in the context of 

the DoJ analysis, but there's always the possibility that a large new market with a track 

new entrance and that certainly the way we've talked so far would not be factored into the 

cash flow. We would need to have a qualitative discussion of what might be the impact of 

a new entrant on the existing players. For employment impacts, we plan on gathering 

employment levels at existing plants particularly those that serve that US market existing 

data and manufacturing abuse will be used to estimate employment level differences 

between the different standard levels. Interviews will be used to establish differences in 

work force skills under different levels of energy of efficiency standards. At DoE 

interviews, manufacturers will establish likely impact of new efficiency standards on the 

product mix and employment levels. One thing we really need to improve I think in the 

Strawman is understanding what the levels of investments to convert over those 30 million 

ballast's that's going to be and the extent to which any equipment, though I have my own 

doubts about that, can be reused and also try to understand some of the more structural 

changes that may happen on product mix and how although we're only tracking those 

immediate ballasts that are being impacted, there may be some other effects on product 

mix or secondary effect. One thing we found about it is what happens if there's suddenly 

this large production capacity available for producing magnetic ballasts. What happens to 

people who produce residential ballasts? What would be the impact there if that market 

becomes more competitive? So that's sort of secondary yet not trivial impact. We put 

together a very preliminary interview guide. It has as its purpose to do two things really, 

114 
To touch on the cash flow analysis and try to understand any variances there are with our

Strawman and also to touch on the other metrics of impact (not audible) impacts on

capacity and employment. I've asked Quentin to, not to overlook the questionnaire but

quickly go over some of the key issues and we're hoping to continue to developing that

questionnaire over the next six weeks as well. So in 6 weeks what we would have is a

completed GRIM spreadsheet with our Strawman inputs and an interview guide that will

serve us, would be comprehensive and in some cases not applicable to some

manufacturers, but everyone will have a chance to look at before we come and do the

interviews.

Edward Osann:

On the review of the transit employment levels, page 39, in those interviews will you be

seeking employment levels at US plants or all plants serving US market or all plants

worldwide?

Rivest:

We're tracking those 30 million ballasts and we want to understand where the jobs are

that produce them wherever they are. We report them at 3 levels is what I thought I

understood from the discussion this morning, or earlier this afternoon. The US, NEFTA

and Global.

Brookman:

Question?

Looney:

Thank you. I'm looking forward to getting to know some of the manufacturers better and

2) the series of interviews partly because my first job out of grad school was with a large

industrial manufacturing company. I was in the central research facility and one of the

things I did over my brief time there. I was there about 7 years was to develop some

incremental improvements to some of the processes. So I wound up being out in the

industrial plants occasionally. I came to marvel and really respectful of people who run

115

EE-RM-97-500 COMMENT 21OO

To touch on the cash flow analysis and try to understand any variances there are with our 

Strawman and also to touch on the other metrics of impact (not audible) impacts on 

capacity and employment. I've asked Quentin to, not to overlook the questionnaire but 

quickly go over some of the key issues and we're hoping to continue to developing that 

questionnaire over the next six weeks as well. So in 6 weeks what we would have is a 

completed GRIM spreadsheet with our Strawman inputs and an interview guide that will 

serve us, would be comprehensive and in some cases not applicable to some 

manufacturers, but everyone will have a chance to look at before we come and do the 

interviews. 

Edward Osann: 

Rivest: 

On the review ofthe transit employment levels, page 39, in those interviews will you be 

seeking employment levels at US plants or all plants serving US market or all plants 

worldwide? 

We're tracking those 30 million ballasts and we want to understand where the jobs are 

that produce them wherever they are. We report them at 3 levels is what I thought I 

understood from the discussion this morning, or earlier this afternoon. The US, NEFT A 

and Global. 

Brookman: 

Question? 

Looney: 

Thank you. I'm looking forward to getting to know some of the manufacturers better and 

2) the series of interviews partly because my first job out of grad school was with a large 

industrial manufacturing company. I was in the central research facility and one of the 

things I did over my brief time there. I was there about 7 years was to develop some 

incremental improvements to some of the processes. So I wound up being out in the 

industrial plants occasionally. I came to marvel and really respectful of people who run 

115 
these industrial plants or even some pieces of them. It takes a real talent to be able to deal

with all the pressures from management and other pressures from labor, all the constraints

that people have to deal with and still make a high quality product at a very low cost. I

look at this as a learning experience and appreciate the opportunity. Today, I think what

we want to do is outline what our basic needs are from the interviews. Distribute the

interview guide, which you already have in the manufacturing impact analysis handout.

It's certainly a draft, work in progress and over the next six weeks or so we hope that with

help from you we can develop a guide that will be useful for all of us. So we do

encourage you to contact us with suggestions and improvements that you think would be

useful for the interviews. Basically we're looking to cover 7 topic areas. Some of them

are related and most of them have been covered to some extent already. The current

organizational characteristics of the company. We really want to focus on the plant level,

profit center level, look at industry infrastructure and the global nature of the industry

today. Basically the situation in which each plant finds itself for those first three items.

The cash flow analysis, we've gone over in some detail already and I'll just mention it

again briefly. The impact assessments that you see at the end are really the things which

have been added to the rulemaking process in this new round and we know that

manufacturers have a lot of information to contribute there and we want to go out and

solicit it one on one so that we all can come to understand what we're facing. First, the

organizational characteristics, once again we're interested in the plant level, profit center

level. We're interested in production levels, production mix, costs, the things that go into

the cash flow analysis you saw earlier. We're interested in the organizational setting in

which the manufacturer finds itself Are you part of a large conglomerate, a minor part?

Is ballast manufacturing your primary business that sort of thing? Much of this we know

on a superficial basis. We would like to talk over these things one on one just so we can

improve on our understanding. DoE is also interested in the infrastructure from two

points of view. One, what is the infrastructure that gets your product from the plant to the

116

EE-RM-97-500 COMMENT 21OO

these industrial plants or even some pieces of them. It takes a real talent to be able to deal 

with all the pressures from management and other pressures from labor, all the constraints 

that people have to deal with and still make a high quality product at a very low cost. I 

look at this as a learning experience and appreciate the opportunity. Today, I think what 

we want to do is outline what our basic needs are from the interviews. Distribute the 

interview guide, which you already have in the manufacturing impact analysis handout. 

It's certainly a draft, work in progress and over the next six weeks or so we hope that with 

help from you we can develop a guide that will be useful for all of us. So we do 

encourage you to contact us with suggestions and improvements that you think would be 

useful for the interviews. Basically we're looking to cover 7 topic areas. Some of them 

are related and most of them have been covered to some extent already. The current 

organizational characteristics of the company. We really want to focus on the plant level, 

profit center level, look at industry infrastructure and the global nature ofthe industry 

today. Basically the situation in which each plant finds itself for those first three items. 

The cash flow analysis, we've gone over in some detail already and I'll just mention it 

again briefly. The impact assessments that you see at the end are really the things which 

have been added to the rulemaking process in this new round and we know that 

manufacturers have a lot of information to contribute there and we want to go out and 

solicit it one on one so that we all can come to understand what we're facing. First, the 

organizational characteristics, once again we're interested in the plant level, profit center 

level. We're interested in production levels, production mix, costs, the things that go into 

the cash flow analysis you saw earlier. We're interested in the organizational setting in 

which the manufacturer finds itself. Are you part of a large conglomerate, a minor part? 

Is ballast manufacturing your primary business that sort of thing? Much of this we know 

on a superficial basis. We would like to talk over these things one on one just so we can 

improve on our understanding. DoE is also interested in the infrastructure from two 

points of view. One, what is the infrastructure that gets your product from the plant to the 

116 
market place? We've seen some diagrams earlier today where we're getting a better

understanding of that as time goes on and we would like to get what the path from the

plant to the ultimate customer is with respect to each of the manufacturers. The other side

of the coin we're also interested in getting your views on your trade ally and supplier side

of the infrastructure. We've had some discussion of that already also, but we do want to

revisit that and we'll have an opportunity then for each manufacturer to identify for us as

major suppliers, trade allies and we would invite you to put us in contact with them or to

arrange for some way for us to get input from your supplier side as well. You can stop

me at any time if any questions come up. I'm going to go through these fairly quickly.

Also, of course, we are interested in getting your take on the global nature of the ballast

industry. We've been through that some already today. We know that there's a lot of

movement within the industry, there's the possibility of new entrants. If standards go into

effect and we would just like to get your views on how your relationship to the global

industry might change if new energy efficiency standards were put into effect. Cash flow

analysis, we've been through this in some detail. Each manufacturer will have the

opportunity and we hope we'll take this to heart to run the GRIM analysis and go over it

with us while we're at the plant. This is just not the same example that you've seen

earlier, but once again we would hope that each manufacturer would simply run the GRIM

analysis, talk with us between now and the time that we come to visit just to get familiar

with the extent to which you might have questions and so on so that you are fairly

comfortable with the flow sheet once we get to the facility. It's my expectation that Mike

will not really need to take the completed flow sheet with him half the time, if you feel that

during the course of the discussion there is some adjustments you want to make or some

changes that you want to put into effect because of the conversations that we may have

had during the day, on the draft flow sheet that you produce before the visit. Also, to

reiterate that the information that is supplied to us can be kept confidential. Our objective

is to learn the true unbiased situation as much as closely as we can so that we can do our

117

EE-RM-97-500 COMMENT 21OO

market place? We've seen some diagrams earlier today where we're getting a better 

understanding of that as time goes on and we would like to get what the path from the 

plant to the ultimate customer is with respect to each of the manufacturers. The other side 

of the coin we're also interested in getting your views on your trade ally and supplier side 

of the infrastructure. We've had some discussion of that already also, but we do want to 

revisit that and we'll have an opportunity then for each manufacturer to identify for us as 

major suppliers, trade allies and we would invite you to put us in contact with them or to 

arrange for some way for us to get input from your supplier side as well. You can stop 

me at any time if any questions come up. I'm going to go through these fairly quickly. 

Also, of course, we are interested in getting your take on the global nature of the ballast 

industry. We've been through that some already today. We know that there's a lot of 

movement within the industry, there's the possibility of new entrants. Ifstandards go into 

effect and we would just like to get your views on how your relationship to the global 

industry might change if new energy efficiency standards were put into effect. Cash flow 

analysis, we've been through this in some detail. Each manufacturer will have the 

opportunity and we hope we'll take this to heart to run the GRIM analysis and go over it 

with us while we're at the plant. This is just not the same example that you've seen 

earlier, but once again we would hope that each manufacturer would simply run the GRIM 

analysis, talk with us between now and the time that we come to visit just to get familiar 

with the extent to which you might have questions and so on so that you are fairly 

comfortable with the flow sheet once we get to the facility. It's my expectation that Mike 

will not really need to take the completed flow sheet with him half the time, if you feel that 

during the course ofthe discussion there is some adjustments you want to make or some 

changes that you want to put into effect because of the conversations that we may have 

had during the day, on the draft flow sheet that you produce before the visit. Also, to 

reiterate that the information that is supplied to us can be kept confidential. Our objective 

is to learn the true unbiased situation as much as closely as we can so that we can do our 

117 
job more effectively. I think that pretty well covers this. The DoJ impact on competition

once again

Foley:

(Not audible) page 47.

Rivest:

All of the data gathering and the confidentiality and we used the word unbiased (not

audible) and that's what finally sent me over the edge here. You are gathering data, you

maintain confidentiality so in other words, you are not sharing with anybody and it sounds

to me with the exception of Arthur D. Little, there is no way of actually coberating that

the data the manufacturer is giving you are in any way indicative of what actuality is.

ADL has the opportunity to iook into the possibility of testing the data in any way, a

degree of confidence, at lean those of us who have no way of even looking at it until you

guys have massaged it (not audible) as being reality based. (Not audible).

Foley:

The only person that could disagree with the data is Arthur D. Little Company. There is

no other way anybody else other than you all can test the validity of the data. From that

sense we have a real difficulty with that process. The validity or the reasonableness, either

one. We have, (not audible) validity (not audible).

McCabe:

The first part lies the answer is key. The Strawman that he is developing that he feels is

(not audible) public sources, DoE will have access to it as well as anybody else and

certainly (not audible) for my office. We look at the results compared to the Strawman

(not audible). Look to track and understand those differences so that. Mike talks about

being comfortable himself and we'll have those two pieces of information. He's going to

have to try and convince us and in turn we're going to have convince everybody else that

the aren't being consistent. (Not audible).

118

EE-RM-97-500 COMMENT 21OO

Foley: 

Rivest: 

Foley: 

job more effectively. I think that pretty well covers this. The DoJ impact on competition 

once again 

(Not audible) page 47. 

All of the data gathering and the confidentiality and we used the word unbiased (not 

audible) and that's what finally sent me over the edge here. You are gathering data, you 

maintain confidentiality so in other words, you are not sharing with anybody and it sounds 

to me with the exception of Arthur D. Little, there is no way of actually co berating that 

the data the manufacturer is giving you are in any way indicative of what actuality is. 

ADL has the opportunity to iook into the possibility oftesting the data in any way, a 

degree of confidence, at leasi those of us who have no way of even looking at it until you 

guys have massaged it (not audible) as being reality based. (Not audible). 

The only person that couid disagree with the data is Arthur D. Little Company. There is 

no other way anybody else other than you all can test the validity of the data. From that 

sense we have a real difficulty ""ith that process. The validity or the reasonableness, either 

one. We have (not audible) validity (not audible). 

McCabe: 

The first part lies the answer is key. The Strawman that he is developing that he feels is 

(not audible) public sources, DoE will have access to it as well as anybody else and 

certainly (not audible) for my office. We look at the results compared to the Strawman 

(not audible). Look to track and understand those differences so that. Mike talks about 

being comfortable himselfand we'll have those two pieces of information. He's going to 

have to try and convince us and in turn we're going to have convince everybody else that 

the aren't being consistent. (Not audible). 

118 
Looney:

We also want to explore employment impacts as we mentioned before including both

direct and secondary employment impacts. And finally, the any stranded costs or changes

in the asset use brought about by standards would also be discussed. Anybody have any

questions? Once again, we'll be finalizing this over the next six weeks or so and look

forward to talking with you some more and I'll ask Mike to come back up and talk about

the next step.

Rivest:

Going full circle to Carl's slide here with the schedule. Our schedule now is to complete

the GRIM Strawman and the interview questionnaire by June 11. We're going to have it

mailed out to give you sufficient time to begin internally looking at how we might put

together a cash flow analysis, start thinking through the answers to some of those

interview questions. And initiate the interview process in the month of July.

Stein:

Comment period? Yes. We're trying to struggle to get our comments in on information

we have until now by May 28th. There are two industry meetmgs that take up two weeks

in the next four weeks, the only additional information we've gotten and also to sounds

like, input substantial information into the Strawman, I think we need at least another

month. If we shoot for your 1 lth date would be great unless you are going to get that

information out to us by the 11th. We'll make a formal request of...

Rivest:

I'll need some time after I've received your comments to factor that back into the

spreadsheet and the questionnaire, that's a couple weeks there certainly.

Unknown:

A lot of new information we would like to be able to give you good comments on it, if we

can do it by the deadline, suggests that we're not going to be able to do a good job. We'll

make a formal request of extension

119

EE-RM-97-500 COMMENT 21OO

Looney: 

Rivest: 

Stein: 

Rivest: 

We also want to explore employment impacts as we mentioned before including both 

direct and secondary employment impacts. And finally, the any stranded costs or changes 

in the asset use brought about by standards would also be discussed. Anybody have any 

questions? Once again, we'll be finalizing this over the next six weeks or so and look 

forward to talking with you some more and I'll ask Mike to corne back up and talk about 

the next step. 

Going full circle to Carl's slide here with the schedule. Our schedule now is to complete 

the GRIM Strawrnan and the interview questionnaire by June 11. We're going to have it 

mailed out to give you sufficient time to begin internally looking at how we might put 

together a cash flow analysis, start thinking through the answers to some of those 

interview questions. And initiate the interview process in the month of JUly. 

Comment period? Ye~. We're trying to struggle to get our comments in on information 

we have until now by May 28th. There are two industry meetmgs that take up two weeks 

in the next four weeks, the only additional information we've gotten and also to sounds 

like, input substantial information into the Strawrnan, I think we need at least another 

month. If we shoot for your 11 th date would be great unless you are going to get that 

information out to us by the 11th. We'll make a formal request of ... 

I'll need some time after I've received your comments to factor that back into the 

spreadsheet and the questionnaire, that's a couple weeks there certainly. 

Unknown: 

A lot of new information we would like to be able to give you good comments on it, ifwe 

can do it by the deadline, suggests that we're not going to be able to do a good job. We'll 

make a formal request of extension 

119 
Adams:

This is another month for what step?

Rivest:

Comments on the workshop.

Adams:

We've gotten a couple of inches of paper and a couple of new programs here that we're

going to try to digest and comment on plus we need accurate information on the

Strawman in order for that to work proper. We can't possible do it in the time allotted

based upon industry commitments that we already have. Most of the people in this room

are tied up with other commitments. The inputs to the Strawman are separate from the

comments.

Rivest:

I would expect those comments to involve a lot of interest in Strawman. (Not audible)

Stein:

We could separate them out; we're going to go through this old mound information to try

to give you information back . That's our comment on it and if that 's unacceptable we'll

give you as much information as we can, but certainly we won't be able to do Strawman

justice by the deadline . In the next information, which is brand new information, you have

to absorb and then comment on it . It's always been a struggle on the information we got

up until today, and now the new information than we have.

Adams:

I was going to say how impressed I was with how prepared everyone was coming into this

meeting. There was a lot of information (not audible) some of, which is new. We're

struggling here to maintain a schedule that we that we're committed to with our manager

if we set a 45 day comment period, I'd just as soon leave here today with knowing what

the comment period is rather than having to make a request and you can know what it is

ahead of time.

120

EE-RM-97-500 COMMENT 21OO

Adams: 

This is another month for what step? 

Rivest: 

Comments on the workshop. 

Adams: 

Rivest: 

Stein: 

We've gotten a couple of inches of paper and a couple of new programs here that we're 

going to try to digest and comment on plus we need accurate information on the 

Strawman in order for that to work proper. We can't possible do it in the time allotted 

based upon industry commitments that we already have. Most of the people in this room 

are tied up with other commitments. The inputs to the Strawman are separate from the 

comments. 

I would expect those comments to involve a lot of interest in Strawman. (Not audible) 

We could separate them out; we're going to go through this old mound information to try 

to give you information back. That's our comment on it and if that's unacceptable we'll 

give you as much information as we can, but certainly we won't be able to do Strawman 

justice by the deadline. In the next information, which is brand new information, you have 

to absorb and then comment on it. It's always been a struggle on the information we got 

up until today, and now the new information than we have. 

Adams: 

I was going to say how impressed I was with how prepared everyone was coming into this 

meeting. There was a lot of information (not audible) some of, which is new. We're 

struggling here to maintain a schedule that we that we're committed to with our managelr 

if we set a 45 day comment period, I'd just as soon leave here today with knowing what 

the comment period is rather than having to make a request and you can know what it is 

ahead of time. 

120 
Invest:

That's fair enough. We'll shoot for 45 days, that give us essentially the original 4 weeks

to work on it.

Adams:

(Not audible) I personally was not aware of your two weeks (not audible) reasonable

compromise on the time.

Rivest:

The timing of the interviews, I anticipate the interviews being conducted over a one-month

period of time so we're talking about having interviews from mid July to mid August. Is

that something that wouldn't be agreeable to your schedules? There's flexibility there

within the month.

Stein:

That was our vacation times for factory. And I assume that you want to go to the

factories, so we would have to see how that works. How many companies will you be

visiting over that?

Rivest:

6 or 7. 6

Stein:

I would like to do this in several facilities, not just one facility. It's one of the main factors

also. One thing I did comment on before, we are actually suppliers to ourselves. We do

make capacitors, we do make wire, so one of the things we'll be able to show you even

though you are probably not going to visit some of, or are required to visit us (not

audible) facility and extrapolate that kind of information through (not audible)

Rivest:

So that could be as many as 10 visits perhaps.

Stein:

121

EE-RM-97-500 COMMENT 21OO

Rivest: 

That's fair enough. We'll shoot for 45 days, that give us essentially the original 4 weeks 

to work on it. 

Adams: 

Rivest: 

Stein: 

Rivest: 

Stein: 

Rivest: 

Stein: 

(Not audible) I personally was not aware of your two weeks (not audible) reasonable 

compromise on the time. 

The timing of the interviews, I anticipate the interviews being conducted over a one-month 

period of time so we're talking about having interviews from mid July to mid August. Is 

that something that wouldn't be agreeable to your schedules? There's flexibility there 

within the month. 

That was our vacation times for factory. And I assume that you want to go to the 

factories, so we would have to see how that works. How many companies will you be 

visiting over that? 

6 or 7. 6 

I would like to do this in several facilities, not just one facility. It's one ofthe main factors 

also. One thing I did comment on before, we are actually suppliers to ourselves. We do 

make capacitors, we do make wire, so one of the things we'll be able to show you even 

though you are probably not going to visit some of, or are required to visit us (not 

audible) facility and extrapolate that kind of information through (not audible) 

So that could be as many as 10 visits perhaps. 

121 
Right. I think we would need at least a month from the time (not audible) Strawman

finalized, GRIM model finalized and of course Strawman finalized (not audible) question

(not audible) and now we are stepping back into our own companies to try and gather this

information which is (not audible) information. I don't have this. I know that people can

get a lot of information I think to show everyone up here. I don't think we can start the

interviews until a month after we get the final documents.

Rivest:

That would be June 25th to July 25th. So the interviews are essentially in the month of

August.

Stein:

We can try for the month of August to work it in. I think can start looking at scheduling.

We can look at the availability of our facilities. I think all of us over the next 45 days

maybe we can start to plan scheduling our commitment and your commitment so you can

work in schedule that all of the plant would be available to you.

Rivest:

So this is a couple of weeks and the interviews wouldn't start until August 1 so that it

would be one month from these dates here.

Adams:

(Not audible) do everything you want to do in a month. You're only talking 20 days in a

month not 31.

Stein:

(Not audible) interview time is preparing and traveling, whatever, I think that it's a very

tight schedule to gather all that information. We need to prepare, you can determine what

you need to do the job.

Adams:

So we're talking comments due by roughly mid June, which is June the 12th, would be

Friday. We're talking about the interviews being roughly the end of June.

122

EE-RM-97-500 COMMENT 21OO

Rivest: 

Stein: 

Rivest: 

Adams: 

Stein: 

Right. I think we would need at least a month from the time (not audible) Strawman 

finalized, GRIM model :finalized and of course Strawman finalized (not audible) question 

(not audible) and now we are stepping back into our own companies to try and gather this 

information which is (not audible) information. I don't have this. I know that people can 

get a lot of information I think to show everyone up here. I don't think we can start the 

interviews until a month after we get the :final documents. 

That would be June 25th to July 25th. So the interviews are essentially in the month of 

August. 

We can try for the month of August to work it in. I think can start looking at scheduling. 

We can look at the availability of our facilities. I think all of us over the next 45 days 

maybe we can start to plan scheduling our commitment and your commitment so you can 

work in schedule that all of the plant would be available to you. 

So this is a couple of weeks and the interviews wouldn't start until August 1 so that it 

would be one month from these dates here. 

(Not audible) do everything you want to do in a month. You're only talking 20 days in a 

month not 31. 

(Not audible) interview time is preparing and traveling, whatever, I think that it's a very 

tight schedule to gather all that information. We need to prepare, you can determine what 

you need to do the job. 

Adams: 

So we're talking comments due by roughly mid June, which is June the 12th, would be 

Friday. We're talking about the interviews being roughly the end of June. 

122 
Perlis:

So that it's clear, I think we would very officially request that we have the questionnaires

at least one month prior to actually doing the interview because its going to take us that

and better to put it into the schedule if the circulation of the questionnaire slips then we

are (not audible) need to slip accordingly so that we could (not audible) one month prior

to the interviews.

Adams:

I think that was falling into place. If we slip the questionnaire and the Strawman to June

26 and if we say August 3 would be, that's a civic holiday in Canada by the way, that way

we could begin interviews August 3rd. I guess for the time being we'll just let those know

that there are dates up there and float accordingly without trying to put specifics dates on

this.

Stein:

What about the timetable that Carl suggested.

Wisbey:

(Not audible) Mike Stein said (not audible) question I'm going to ask is how many people

have participated on the DoE/A.D. Little side trying to get an idea doing all of the

interview information overload you are going to experience personally. Trying to do all of

those in one month is an incredibly difficult (not audible).

Rivest:

I'll negotiate that with Carl . We're going to make that attempt. He said they were

floating.

Wisbey:

The question that was embedded in that was what size interview team do you expect to

bring to visit manufacturers?

Rivest:

Three people.

123

EE-RM-97-500 COMMENT 21OO

Perlis: 

So that it's clear, I think we would very officially request that we have the questionnaires 

at least one month prior to actually doing the interview because its going to take us that 

and better to put it into the schedule if the circulation of the questionnaire slips then we 

are (not audible) need to slip accordingly so that we could (not audible) one month prior 

to the interviews. 

Adams: 

Stein: 

I think that was falling into place. If we slip the questionnaire and the Strawman to June 

26 and ifwe say August 3 would be, that's a civic holiday in Canada by the way, that way 

we could begin interviews August 3rd. I guess for the time being we'll just let those know 

that there are dates up there and float accordingly without trying to put specifics dates on 

this. 

What about the timetable that Carl suggested. 

Wisbey: 

Rivest: 

(Not audible) Mike Stein said (not audible) question I'm going to ask is how many people 

have participated on the DoE/A.D. Little side trying to get an idea doing all of the 

interview information overload you are going to experience personally. Trying to do all IOf 

those in one month is an incredibly difficult (not audible). 

I'll negotiate that with Carl. We're going to make that attempt. He said they were 

floating. 

Wisbey: 

Rivest: 

The question that was embedded in that was what size interview team do you expect to 

bring to visit manufacturers? 

Three people. 

123 
Wisbey:

All of them from AD Little?

Rivest:

All from AD Little, yes.

Wisbey:

You do not anticipate DoE staff.

McCabe:

I'd like to talk about that. (Not audible). One of the commitments however that we've

made the process (not audible) is that DoE is going to be managing this a lot more closely,

closer than we have in the past, that we will be going on. Interviews will be meeting with

the manufacturers to (not audible) to be educated as well rather than some were

concerned with contractors were guiding the process. This in fact is our process. I do

recognize, however, that this information is very sensitive and with entertain discussion

how DoE could play a role in it's discussion. They may be not there for all the

discussions, but part of the team that comes to the (not audible) to visit.

Wolfinan:

If we can't separate the discussions, which are confidential, that (not audible) vs

discussion which still don't have that same degree of confidentiality, we all can find extra

rooms nearby, and we can ask them to step out while we have that discussion. So I think

we can work something out.

McCabe:

Would this information, we talked about how its going to be presented to DoE

management, Carl needs to understand any others (not audible) in order to be fairly

represented. I would like to explore how the DoE staff can be part of this. It may be that

some of it may not be possible at all or may not be reasonable or we can split it out. But

we need (not audible).

Stein:

124

EE-RM-97-500 COMMENT 21OO

Wisbey: 

All of them from AD Little? 

Rivest: 

All from AD Little, yes. 

Wisbey: 

You do not anticipate DoE staff. 

McCabe: 

I'd like to talk about that. (Not audible). One of the commitments however that we've 

made the process (not audible) is that DoE is going to be managing this a lot more closely, 

closer than we have in the past, that we will be going on. Interviews will be meeting with 

the manufacturers to (not audible) to be educated as well rather than some were 

concerned with contractors were guIding the process. This in fact is our process. I do 

recognize, however, that this information is very sensitive and with entertain discussion 

how DoE could playa role in it's discussion. They may be not there for all the 

discussions, but part of the team tMt comes to the (not audible) to visit. 

Wolfi:nan: 

Ifwe can't separate the discussions, which are confidential, that (not audible) vs 

discussion which still don't have that same degree of confidentiality, we all can find extra 

rooms nearby, and we can ask them to step out while we have that discussion. So I think 

we can work something out. 

McCabe: 

Stein: 

Would this information, we talked about how its going to be presented to DoE 

management, Carl needs to understand any others (not audible) in order to be fairly 

represented. I would like to explore how the DoE staff can be part of this. It may be tha~ 

some of it may not be possible at all or may not be reasonable or we can split it out. But 

we need (not audible). 

124 
From our standpoint, in principle except for (not audible) technicality, we have no more

difficulty in being open to DoE staff than with AD Little staff and would welcome the

participation. The technicality that's involved there (not audible) has to be dealt with if we

do it, is the (not audible) statements of the former rules of DoE's confidentiality have

always said that DoE will take information that we present as confidential and in the end

make their own judgment as to whether or not it is truly confidential and if in the DoE's

judgment is not truly confidential, it becomes part of the public record. Under those

circumstances we find providing confidential information virtually impossible. So it's that

piece of rule can be clarified such that DoE will respect confidentiality and can it respect

confidentiality when (not audible); we have no problem at all with full participation by

DoE.

McCabe:

So if DoE is taking it to extreme (not audible) walk away without notes or written

material of any sort, (not audible) information which could be released. That as far as

what you Just referred to, the Freedom of Information Act requires us how the public can

access information that the department has. Knowledge that is not written down, not

accessible. It is the written documents, written record or other records that is covered by

it that goes FOIA requirement.

Brookman:

What I heard a moment ago was that the industry was willing to entertain how this stuff

gets done. And ranging from whether it was necessary for the departmental officials to

move to the next group for part of the conversation to negotiating this point of (not

audible) searches. So maybe there's a conversation that should be entertained that you

could continue looking ahead. You might need to tailor it to each individual case, is that

also?

McCabe:

The department might also consider that.

125

EE-RM-97-500 COMMENT 21OO

From our standpoint, in principle except for (not audible) technicality, we have no more 

difficulty in being open to DoE staff than with AD Little staff and would welcome the 

participation. The technicality that's involved there (not audible) has to be dealt with ifwe 

do it, is the (not audible) statements of the former rules of DoE's confidentiality have 

always said that DoE will take information that we present as confidential and in the end 

make their own judgment as to whether or not it is truly confidential and if in the DoE's 

judgment is not truly confidential, it becomes part of the public record. Under those 

circumstances we find providing confidential information virtually impossible. So it's that 

piece of rule can be clarified such that DoE will respect confidentiality and can it respect 

confidentiality when (not audible); we have no problem at all with full participation by 

DoE. 

McCabe: 

So if DoE is taking it to extreme (not audible) walk away without notes or written 

material of any sort, (not audible) information which could be released. That as far as 

what you just referred to, the Freedom of Information Act requires us how the public can 

access information that the department has. Knowledge that is not written down, not 

accessible. It is the written documents, written record or other records that is covered by 

it that goes FOIA requirement. 

Brookman: 

What I heard a moment ago was that the industry was willing to entertain how this stuff 

gets done. And ranging from whether it was necessary for the departmental officials to 

move to the next group for part of the conversation to negotiating this point of (not 

audible) searches. So maybe there's a conversation that should be entertained that you 

could continue looking ahead. You might need to tailor it to each individual case, is that 

also? 

McCabe: 

The department might also consider that. 

125 
Brookman:

Additional items comments on the subject area?

Martin:

I have struggled with this (not audible) clearly the possibility of somebody demanding

information that is not written down is hard to imagine. Very difficult to access written

information unless you know exactly what it is. Then to figure out where you get it from.

(Not audible). It is a concern that I don't think we need to have as long as they don't take

notes or photographs

Franco:

I think that probably a few problems are (not audible) regulation. One is the FOIA

problem and that is probably more easily addressed because it is (not audible) discovery

(not audible) and then there's the secondary problem with the department's own

regulation or in terms of confidentiality. I haven't looked at these in a while, unfortunately

I'm sure Gene would know if he were in the room, but the bottom line is that sometimes

when you make (not audible) then you want certain parts to be kept confidential then you

have make requests to the Secretary (not audible). That part of it (not audible) during the

interview that that information would get into the department without an ability to make a

confidentiality claim and have it ruled upon. It's probably more a sticking point than the

FOIA issue. But I would suggest some real time limits at this point anymore, we've

looked at the regulations and FOIAs rules but right now we're sort of talking about

something we don't have control over.

Brookman:

Just to clarify. Did I understand the thrust of your points to be that the cumbersome

nature of that request and what follows out from, is that

Franco:

Yeah, because there's a FPOA problem (not audible). But then there's a secondary

problem with this information that is needed in the department to keep internally or

126

EE-RM-97-500 COMMENT 21OO

Brookman: 

Martin: 

Additional items comments on the subject area? 

I have struggled with this (not audible) clearly the possibility of somebody demanding 

information that is not written down is hard to imagine. Very difficult to access written 

information unless you know exactly what it is. Then to figure out where you get it from. 

(Not audible). It is a concern that I don't think we need to have as long as they don't take 

notes or photographs 

Franco: 

I think that probably a few problems are (not audible) regulation. One is the FOIA 

problem and that is probably more easily addressed because it is (not audible) discovery 

(not audible) and then there's the secondary problem with the department's own 

regulation or in terms of confidentiality. I haven't looked at these in a while, unfortunately 

I'm sure Gene would know ifhe were in the room, but the bottom line is that sometimes 

when you make (not audible) then you want certain parts to be kept confidential then you 

have make:; requests to the Secretary (not audible). That part ofit (not audible) during the 

interview that that information would get into the department without an ability to make a 

corJidentiality claim and have it ruled upon. It's probably more a sticking point than the 

FOIA issue. But I would suggest some real time limits at this point anymore, we've 

looked at the regulations and FOIAs rules but right now we're sort of talking about 

something we don't have control over. 

Brookman: 

Just to clarify. Did I understand the thrust of your points to be that the cumbersome 

nature ofthat request and what follows out from, is that 

Franco: 

Yeah, because there's a FPOA problem (not audible). But then there's a secondary 

problem with this information that is needed in the department to keep internally or 

126 
whatever and that's usually done, I mean in other department is not just a confidentiality

problem but a lot of times you have to make an obligation to (not audible). There is a

period where theoretically the department could rule against you. (Not audible).

Brookman:

So the way that I interpret this conversation, let me suggest one way forward from this

that Michael McCabe and Mike Rivest. Michael McCabe's office is working with Arthur

D. Little, Carl and others that they try to arrive at some way that could work for the

manufacturers prior to the visits.

Adams:

Let me just say that from relevant experiences was with the refrigerator rule when there

were negotiations going on between the manufacturers and other parties that I did sit in on

presentations by manufacturers one by one. We went into a room with the other parties

involved and there was a discussion about the financial impacts, very specific information

on management impacts. There were no notes taken, there was no written record, it was

just a verbal presentation of the financial impacts of various standard levels. There is no

record of it; there's nothing to access. I think there's a definitely difference between

what's written down and what is said verbally.

Brookman:

Are there any more comments on this subject before we move onto to the last item of the

day? Yes?

Osann:

I'm looking at the opposite slide that's up and if, is the two week extension on the end of

the workshop comment period going to result in a full month revision on the last two

items on this page?

Brookman:

Carl do you want to respond to that again?

Adams:

127

EE-RM-97-500 COMMENT 21OO

whatever and that's usually done, I mean in other department is not just a confidentiality 

problem but a lot of times you have to make an obligation to (not audible). There is a 

period where theoretically the department could rule against you. (Not audible). 

Brookman: 

So the way that I interpret this conversation, let me suggest one way forward from this 

that Michael McCabe and Mike Rivest. Michael McCabe's office is working with Arthur 

D. Little, Carl and others that they try to arrive at some way that could work for the 

manufacturers prior to the visits. 

Adams: 

Let me just say that from relevant experiences was with the refrigerator rule when there 

were negotiations going on between the manufacturers and other parties that I did sit in on 

presentations by manufacturers one by one. We went into a room with the other parties 

involved and there was a discussion about the financial impacts, very specific information 

on management impacts. There were no notes taken, there was no written record, it was 

just a verbal presentation of the financial impacts of various standard levels. There is no 

record of it; there's nothing to access. I think there's a definitely difference between 

what's written down and what is said verbally. 

Brookman: 

Osann: 

Are there any more comments on this subject before we move onto to the last item of the 

day? Yes? 

I'm looking at the opposite slide that's up and if, is the two week extension on the end of 

the workshop comment period going to result in a full month revision on the last two 

items on this page? 

Brookman: 

Carl do you want to respond to that again? 

Adams: 

127 
It's certainly a possibility of we're going to try to make up time wherever we can. We're

certainly under pressure to stick to the schedule that we have. Certainly the major

milestones when NOPR comes out when the final rule comes out. At some point as you

has some slippage on points it beings to effect the overall schedule, but we're certainly

going to chance to stay on that overall schedule.

McCabe:

One additional point to make is that what has been discussed, what the industry were two

separate two-week extensions. One was an additional two weeks for the comment period

on today's workshop, which was to the June 12th date. We also discussed that it was

necessary to have a full month instead of a half month that was up here, to review the

Strawman questionnaire so that its not a two week delay that is going to result in an

overall four week delay and they proposing to two separate two-week additional (not

audible).

Osann:

Will these revisions result in a change in schedule for the NOPR which is based on the

material you've provided February 19, 1999?

McCabe:

We'll have to map that out. What exactly it has.

Osann:

Has the standards program committed to the secretary maintained this schedule?

McCabe:

Yes.

Osann:

For the NOPR and the final rule?

McCabe:

Yes, what we're going to. This is information that we will take upstairs to Dan Reicher

rationale for the extension. Get back to all parties who take exception to that.

128

EE-RM-97-500 COMMENT 21OO

It's certainly a possibility of we're going to try to make up time wherever we can. We're 

certainly under pressure to stick to the schedule that we have. Certainly the major 

milestones when NOPR comes out when the final rule comes out. At some point as you 

has some slippage on points it beings to effect the overall schedule, but we're certainly 

going to chance to stay on that overall schedule. 

McCabe: 

Osann: 

One additional point to make is that what has been discussed, what the industry were two 

separate two-week extensions. One was an additional two weeks for the comment period 

on today's workshop, which was to the June 12th date. We also discussed that it was 

necessary to have a full month instead of a half month that was up here, to review the 

Strawman questionnaire so that its not a two week delay that is going to result in an 

overall four week delay and they proposing to two separate two-week additional (not 

audible). 

Will these revisions result in a change in schedule for the NOPR which is based on the 

material you've provided February 19, 1999? 

McCabe: 

We'll have to map that out. What exactly it has. 

Osann: 

Has the standards program committed to the secretary maintained this schedule? 

McCabe: 

Yes. 

Osann: 

For the NOPR and the final rule? 

McCabe: 

Yes, what we're going to. This is information that we will take upstairs to Dan Reicher 

rationale for the extension. Get back to all parties who take exception to that. 

128 
Osann:

With these near term extensions don't necessarily translate into further stretch out on the

NOPR publication of the final rule?

McCabe:

That's possible. I would say than with NOPR than with final rule.

Brookman:

Are there still questions or comments at this point ? I guess then that we should record

any additional next steps that would be appropriate.

Carl Adams:

I believe that we have covered all of the next steps that I had intended.

Mark Perlis:

I for one feel that LBNL still has additional work to analyzing a couple of the

key LCC issues. I hope there's going to be opportunity for us to have some

form of dialog about it. The next one is suppose to be on the Manufacturing

Impact Analysis.

Carl Adams:

No that's not correct.

Mark Perlis:

Oh, that's not correct. Okay, fine, then we will have a chance to look again

at (not audible) in October or when ever that is.

Carl Adams:

Correct.

Bob Wisbey:

This is just a question of clarification on that because the (not audible) there was

a draft document last summer we provided comments in the fall. And we were

provided a document about ten days ago that was the result our rebuttal of our

129

EE-RM-97-500 COMMENT 21OO

Osann: 

With these near term extensions don't necessarily translate into further stretch out on the 

NOPR publication of the final rule? 

McCabe: 

That's possible. I would say than with NOPR than with final rule. 

Brookman: 

Are there still questions or comments at this point? I guess then that we should record 

any additional next steps that would be appropriate. 

Carl Adams: 

I believe that we have covered all of the next steps that I had intended. 

Mark Per1is: 

I for one feel that LBNL still has additional work to analyzing a couple ofthe 

key LCC issues. I hope there's going to be opportunity for us to have some 

form of dialog about it. The next one is suppose to be on the Manufacturing 

Impact Analysis. 

Carl Adams: 

No that's not correct. 

Mark Per1is: 

Oh, that's not correct. Okay, fine, then we will have a chance to look again 

at (not audible) in October or when ever that is. 

Carl Adams: 

Correct. 

Bob Wisbey: 

This is just a question of clarification on that because the (not audible) there was 

a draft document last summer we provided comments in the fall. And we were 

provided a document about ten days ago that was the result our rebuttal of our 

129 
rebuttal. Which we rebutted again today. There are two to three points very

much in contention here in doing LCC (not audible) It is my understanding that

LBNL will re-run all of those calculations. Will we again have the opportunity

notes or comments that we made today, plus the comments we submit by June

12th, will we have an opportunity to review the decisions that were made of those prior to

them being implemented or will that information simple be used, information used,

decisions made and then the calculations done?

Carl Adams:

At some point we have to draw a line and say you know we're moving forward.

And the next scheduled opportunity for dialog would be the October workshop

were the LLC results will be presented as well as the Manufacture Impact Analysis

results. I don't foresee another intermediate step, we will take the

comments -- we will take the information that we've received today and we

will utilize that information perhaps not to (not audible).

Unknown:

You will take the information provided today, plus the written comments by June

12th -- you will take that under advisement, make decisions and proceed.

Carl Adams:

Correct. And that would be presented at the October workshop.

Gene Foley:

To clarify the October workshop. We seem to spend an awful time (not audible)

So the October workshop we will just get a presentation of the final LCC by the

Department along with the MIA.

Carl Adams:

It will be the results although I would expect that the inputs would be made

available as to what they were.

130

EE-RM-97-500 COMMENT 21OO

rebuttal. Which we rebutted again today. There are two to three points very 

much in contention here in doing LCC (not audible) It is my understanding that 

LBNL will re-run all of those calculations. Will we again have the opportunity 

notes or comments that we made today, plus the comments we submit by June 

12th, will we have an opportunity to review the decisions that were made of those prior to 

them being implemented or will that information simple be used, information used, 

decisions made and then the calculations done? 

Carl Adams: 

At some point we have to draw a line and say you know we're moving forward. 

And the next scheduled opportunity for dialog would be the October workshop 

were the LLC results will be presented as well as the Manufacture Impact Analysis 

results. I don't foresee another intermediate step, we will take the 

comments -- we will take the information that we've received today and we 

will utilize that information perhaps not to (not audible). 

Unknown: 

You will take the information provided today, plus the written comments by June 

12th -- you will take that under advisement, make decisions and proceed. 

Carl Adams: 

Correct. And that would be presented at the October workshop. 

Gene Foley: 

To clarifY the October workshop. We seem to spend an awful time (not audible) 

So the October workshop we will just get a presentation of the final LCC by the 

Department along with the MIA. 

Carl Adams: 

It will be the results although I would expect that the inputs would be made 

available as to what they were. 

l30 
Unknown:

It is very likely that the outcome of LCC that there need to move on to MIA.

(not audible) next step.

Unknown:

The presentations at the October workshop, will those be conclusions that DoE

has reached or will it be another briefing on LCC.

Unknown:

Prior to publishing a NOPR that we would present the results of all of the analysis

for public review prior to being share with the decision makers within the Department. I

would expect -- hope -- this workshop, this rulemaking and others

that you can identify the (not audible) presented to management. There's always

the possibility that some proceeding that we will discover that there is an error made

or issue that has not been addressed , and we will go back and make the

appropriated, make the necessary changes. But I am hoping that DoE and its

contractors will be able to present a whole set of analysis and information as to

what the Staff considers to be significant and what we will be presenting to

management, so that all parties could look at it and stress those issues for both

parties.

Barbara Atkinson:

Prior to the workshop in October would be put on the web an overview?

Carl Adams:

I think that would be appropriate to do.

Doug Brookman:

Final comments before close out this session.

Carl Adams:

I believe they have just handed over to me the pleasant task of item number 7

on the agenda which is adjournment, but prior to that I would like to thank

131

EE-RM-97-500 COMMENT 21OO

Unknown: 

It is very likely that the outcome ofLCC that there need to move on to MIA. 

(not audible) next step. 

Unknown: 

The presentations at the October workshop, will those be conclusions that DoE 

has reached or will it be another briefing on LCC. 

Unknown: 

Prior to publishing a NOPR that we would present the results of all of the analysis 

for public review prior to being share with the decision makers within the Department. I 

would expect -- hope -- this workshop, this rulemaking and others 

that you can identifY the (not audible) presented to management. There's always 

the possibility that some proceeding that we will discover that there is an error made 

or issue that has not been addressed, and we will go back and make the 

appropriated, make the necessary changes. But I am hoping that DoE and its 

contractors will be able to present a whole set of analysis and information as to 

what the Staff considers to be significant and what we will be presenting to 

management, so that all parties could look at it and stress those issues for both 

parties. 

Barbara Atkinson: 

Prior to the workshop in October would be put on the web an overview? 

Carl Adams: 

I think that would be appropriate to do. 

Doug Brookman: 

Final comments before close out this session. 

Carl Adams: 

I believe they have just handed over to me the pleasant task of item number 7 

on the agenda which is adjournment, but prior to that I would like to thank 

131 
everyone for coming and I was sincere that I thought that everybody was very

well prepared. And I think that this has been a very worth while workshop.

Again, thank you for coming.

Meeting adjourned.

132

EE-RM-97-500 COMMENT 21OO

everyone for coming and I was sincere that I thought that everybody was very 

well prepared. And I think that this has been a very worth while workshop. 

Again, thank you for coming. 

Meeting adjourned. 

132