### TO: Cyrus Nasseri Carl Adams GeneMargolis George Kelly FOI Office File EE-431 EE-431 GC-41 NIST RM. 1E-190 6TH Floor

Enclosedpleasefind asetofcomments regarding EE-RM-93-501 (NOPRto Amend Test Procedures forFurnaces, DirectHeating Equipment, and Pool Heaters), Shouldyou haveany questions, pleasecontactus on 586-9138. Thankyou.#1 #2 #3 #4 #5 #6

#7 SCHEDULE PUBLICHEARINGREGARDING TESTPROCEDURESFORFURNACES/BOILERS,VENTEDHOME HEATINGEQUIPMENT,ANDPOOLHEATERS

TIME 9:30 9:50 10:10 10:30 10:50 11:10 11:30

12:50

1:10 1:30 2:00 DOCKETNUMBEREE-RM-93-50l JANUARY5,1994

SPEAKER ORGANIZATION CarlAdams DepartmentofEnergy JosephM.Mattingly GAMA JamesA.Ranfone AGA DavidB.Goldstein NaturalResourcesDefenseCouncil ChanningStarke HydronicsInstitute DavidF.Lewis LennoxIndustriesInc. DavidFink RajendraK.Narang LUNCH BREAK MarionO'Neill PublicServiceElectric&GasCo. UnscheduledSpeakers RebuttalStatements QuestionsU.S.DEPARTMENTOFENERGY OfficeofEnergyEfficiencyandRenewableEnergy PublicHearingAttendees TestProceduresfor.Furnaces/Boilers,VentedHome HeatingEquipment,andPoolHeaters DocketNumberEE-RM-93-501 ForrestalBuilding, RoomIE-245 January5,1994 PanelMembers CarlE.Adams PresidingOfficial CyrusNasseri

EugeneMargolis

GeorgeKelly JamesMills

OpeningRemarks CarlE.Adams PresidingOfficial

ScheduledSpeakers 1. JosephM.Mattingly 2. JamesA.Ranfone 3. DavidB.Goldstein 4. ChanningStarke 5. DavidF.Lewis 

### 6. DavidFink 

### 7. MarionO'Neill OfficeofCodesandStandards U.S.DepartmentofEnergy OfficeofCodesandStandards U.S.DepartmentofEnergy OfficeofGeneralCounsel U.S.DepartmentofEnergy NationalInstituteofStandards&Technology FederalTradeCommission

SCHEDULEOFPRESENTATIONS

9:30

Organization GAMA 9:50 AGA 10:10 NaturalResourcesDefenseCouncil 10:30 HydronicsInstitute 10:50 LennoxIndustriesInc. 11:10 RajendraK.Narang 11:30 PublicServiceElectric&GasCompany 12:50UNITED STATES DEPARTMENT OF ENERGY Office of Energy Efficiency and Renewable Energy Hearings and Dockets

) In the Matter of: ) ) PUBLIC HEARING REGARDING ) TEST PROCEDURES FOR FURNACES/) Docket Number BOILERS, VENTED HOME HEATING ) EE-RM-93-501 EQUIPMENT AND POOL HEATERS ) ) Room 1E245 U.S. Department of Energy 1000 Independence Avenue, SW Washington, D.C. Wednesday, January 5, 1993 9:30 a.m. BEFORE: CARL E. ADAMS, Presiding Official Office of Codes and Standards U.S. Department of Energy APPEARANCES: CYRUS NASSERI Office of Codes and Standards U.S. Department of Energy EUGENE MARGOLIS Office of General Counsel U.S. Department of Energy GEORGE KELLY National Institute of Standards and Technology JAMES MILLS Federal Trade Commission

EXECUTIVE COURT REPORTERS, INC. (301) 565-0064I N D E X STATEMENT OF: Opening Remarks Carl E. Adams, Presiding Official Joseph M. Mattingly GAMA James A. Ranfone AGA David B. Goldstein Natural Resources Defense Council Channing Starke Hydronics Institute David F. Lewis Lennox Industries, Inc. David Fink Rajendra K. Narang Marion O'Neill Public Services Electric 

### &Gas Company Michael Martin

EXECUTIVE COURT REPORTERS, INC. (301) 565-0064 2

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1103 1 PROC E EDING S 2 9:30 a.m. 3 MR. ADAMS: Well, it's 9:30, and I hope 4 everyone is here. I know we'remissingmaybe a couple 5 ofpeople. 6 openingRemarks 7 MR. ADAMS: I'd liketowelcome everyone. 8 I'm Carl Adams, the Director of Compliance Standards 9 Division of DOE's Office of Codes and Standards. 10 The Department in thepasthas had a 11 contractorwho handled all of the detailed arrangements 12 of arranging thesehearings. We no longer have that 13 contract. So, now itbefalls to the Program Office to 14 make all the detailed arrangements, and in themanual 15 thatwe got, unfortunately, therewere no instructions 16 on controllingthe weather. Today looks a lot better 17 thanyesterday, and I hope no onehad difficulty 18 gettinghere, andhopewe all gethome at the end of 19 these hearings, those of youwho are staying for the 20 rest of them. 21 But onbehalf of the Department of Energy,



### - 22 I'd liketo thankyou for taking the time to 23 participate inthis publichearing, concerning the 24 Department of Energy's ConservationProgram for 25 Consumer Products. EXECUTIVE COURT REPORTERS, INC. (301) 565-00644 1 Thepurpose of today's publichearing is to 2 receive oral testimony onthe Notice of Proposed 3 Rulemaking regarding amendments to the Department's 4 Test Procedures for Furnaces and Boilers, Vented 5 HeatingEquipment and Pool Heaters as discussed in the 6 ProposedRule, published inthe Federal Register on 7 August 23rd. 8 Comments receivedhere today and those 9 submittedduringthewritten commentperiodwill assist 10 us in developingthe final rule. Comment period for 11 this rulemaking ends February 4th, 1994. 12 All comments submitted on this ProposedRule 13 will be consideredbefore DOE establishes the final 14 rule. Comments received after the comment periodwill 15 be consideredto the fullest extentpossible as time 16 allows. 17 As the DOE presiding official for this 18 hearing, I will set forth the guidelines for conducting 19 the hearing andprovide otherpertinent information. 20 Complete transcript of this hearingwill be available 21 for inspection and copy at the Department of Energy's 22 Freedom of InformationReadingRoom as described in the 23 Notice. Anyonewishingtopurchase a copy of the 24 transcriptmaymake arrangements with the court 25 reporter. EXECUTIVE COURT REPORTERS, INC. (301) 565-00645 1 This will not be an evidentiary orjudicial2 type of hearing. Itwill be conducted in accordance 3 with section 553, Title 5, united states C9des, and 4 section 336 of theAct. 5 To providethe Department of Energywith as 6 muchpertinent information and as many views as can 7 reasonablybe obtained, and to enable interested 8 persons to express theirviews, thehearingwill be 9 conducted in accordancewiththe following procedures. 10 Speakerswill be calledto testifybased on 11 the schedule of thosepeoplewho responded to the 12 Notice of this hearing, and the schedule is available. 13 The speakers have been allocated 20 minutes for their 14 oral statements, as stated in the Notice. Anyone, when 15 making unscheduled oral statements, after all scheduled 16 speakers have deliveredtheir statements, and at the 17 conclusion of allpresentations, each speakerwill be 18 given the opportunitytomake a rebuttal statement, 19 subject to time limitations, and will be called in the 20 order inwhich the initial statementswere made. 21 Questionsmay be asked onlyby panel members 22 conductingthehearing. However, thepresiding 23 officialwill afford any interestedperson an 24 opportunityto question speakerswho have made oral 25 presentations. This opportunitywill be afforded after EXECUTIVE COURT REPORTERS, INC. (301) 565-00646 1 any rebuttal statements to the extent that the 2 presiding official determines that such question is 3 likelyto result in a more timely**~nd** effective 4 resolution of the issue. 5 Persons interested inmakinguse of this 6 opportunitymust submit their requests shortly after 7 the completion of anyrebuttal statements to the 8 Registration Desk. 9 Questions submitted shouldbe identified as 10 towho the author of the question is and towhom the 11 question is beingdirected. I will determine whether 12 the question is relevant, and if the question is 13 allowed, I will ask it. 14 As mentioned earlier, the close of the 15 comment period is February 4th of this year. All 16 comments receivedwill be available for public 17 inspection at the DOE Freedom of InformationReading 18 Room. Such comments shouldbe addressed to the 19 Department of Energy as noted in the ProposedRule. 10 20 copies ofwritten comments are requested. 21 In addition, the Departmentwould appreciate 22 an electronic copy of the comments, andwe are 23 currentlyusingtheWord PerfectVersion of 5.1, and no 24 faxed commentswillbe accepted. 25 Any person submitting informationwhichhe or EXECUTIVE COURT REPORTERS, INC. (301) 565-00641 she believes to be confidential and exempt by law from 2 public disclosure should submit to that same address 3 one complete copy and nine copies from which 4 information is claimedto be confidential has been 5 deleted. 6 In accordancewiththe procedure established 7 at 10 CFR 1004.11, the Department of Energy shallmake 8 its own determination as towhether or not the 9 information shall be exempt frompublic disclosure. 10 Again, we appreciate the time and effort 11 you've taken inpreparingyour statements and are 12 pleasedto receive your comments and opinions. 13 I'dnow like to introduce themembers of the 14 panel. Cyrus Nasseri is the ProgramManager for the 15 subjectproducts inmy division. EugeneMargolis is 16 from the Office of General Counsel. Dr. George Kelly 17 is from NIST, who isunder contract to DOE for 18 assistingus in developing testprocedures for these 19 products, andJamesMills from the Federal Trade 20 Commission, who has responsibility for administering 21 the labellingrequirements of theprogram. 22 At this time, I'll callthe first speaker, 23 and for the record, please stateyour name andwho you 24 represent. 25 EXECUTIVE COURT REPORTERS, INC. (301) 565-0064 78 1 STATEMENT OF JOSEPH M. MATTINGLY, GAMA 2 MR. MATTINGLY: Thank you. 3 My name isJoeMattingly, representing the 4 Gas ApplianceManufacturersAssociation, and I have 5 withme today a young intern in our office, Jack 6 Langmead, who, of course, seriously is ourVice 7 President and Director of Technical Services, and I 8 want to say GAMA appreciates the brief delay thatwas 9 granted in the scheduling of this, and that has allowed 10 Jack tomake a roaring comeback from his recentmedical 11 problems. 12 The Gas ApplianceManufacturers Association 13 is a national trade association that represents the 14 vastmajority of domestic manufacturers of residential 15 gas and oil furnaces, gas boilers, vented gas-fired 16 room heaters, and pool heaters. 17 GAMA appreciates the opportunity to comment 18 on the proposed revisions to DOE's EfficiencyTest 19 Procedures for Furnaces, Boilers, Vented Home Heating 20 Equipment and Pool Heaters. 21 GAMA's comments mostly concern the proposed 22 revisions to the Furnace and BoilerTest Procedures. 23 As a preliminarynote, the currentASHRAE 24 Furnace/BoilerTest Procedure isASHRAE standard 103- 25 1993, and this is the editionthatDOE should EXECUTIVE COURT REPORTERS, INC. (301) 565-00649 1 reference. 2 The proposed changes to the Furnace and 3 BoilerTest-Procedures canbe divided into three 4 distinct categories. Inthe first category are changes 5 thatwould not lower efficiencyratings, including 6 changes to bringthe testprocedures in linewith 7 waivers previouslygranted. GAMA supports immediate 8 adoption of theseproposed changes. I'mnot going to 9 read through all theseproposed changes. You sawthem 10 inyourpaper thatwe submitted about a week ago. 11 I will say, however, that in the category 1, 12 ItemNumber 9, we have testrequirements for modulating 13 units. You'll notice thatwe've modified that to say 14 that's for furnaces only, and I'll explainwhy in a 15 second. 16 Again, those changes GAMA would support 17 immediate adoption of. 18 The second category of proposed changes are 19 again listed in ourpaper. I won't read them. On Item 20 Number 9, under category 2, Test Requirements for 21 ModulatingUnits, (boilers only). 22 As will be explained later, adoption of these 23 proposed changes inthe second categorywill 24 significantlyreduce themeasuredAFUE ofmost 25 furnaces, require DOE to amend the existing furnace EXECUTIVE COURT REPORTERS, INC. (301) 565-006410 1 efficiency standards and cause a great deal of 2 confusion in themarketplace. 3 For thesereasons, GAMA objects to immediate 4 implementation of theseproposed changes and recommends 5 that their implementationbemade to coincidewith the 6 effective date of the next scheduledround of NAECA 7 Furnace and Boiler Efficiency Standards. 8 Now, the reason for placingthe test 9 requirements for modulatingunits in category 1 for 10 Furnaces and category 2 for Boilers is thatwe know of 11 no furnace on themarket todaywhose efficiencyrating 12 would be negatively impactedby the requirement to set 13 test atminimum inputrate, whereas there are several 14 boilermodels whose efficiencyratingwould be 15 negatively impacted. 16 More details onthis pointwill be included 17 in ourwritten comments. 18 The thirdcategory ofproposed changes is the 19 addition of a new annual efficiencyenergy descriptor 20 based on an indoor installation, including adoption of 21 a 3.37 source energymultiplier or F factor to be 22 applied to the electro-consumption. 23 GAMA understands theneedto consider 24 electrical consumption, buturges DOE to correlate its 25 adoption of any new efficiencydescriptor with the EXECUTIVE COURT REPORTERS, INC. (301) 565-006411 1 effective date of the next scheduledround of NAECA 2 Furnace and Boiler Efficiency Standards. 3 Let me now elaborate further on why GAMA is 4 opposedto immediate implementation of the second 5 category of proposed changes. After that, problems 6 associatedwith theuse of theproposed annual 7 efficiencydescriptor will be discussed. 8 In its Federal Register rulemaking notice, 9 DOE states that theproposed testprocedure 10 modifications will not require any change inminimum 11 efficiency standards for furnaces and boilers. In this 12 respect, DOE is mistaken. 13 At GAMA's request, ETL Testing Laboratories 14 has tested a multitude of furnace models under both the 15 existing and proposed revisedtestprocedures. Test 16 results show that individual proposed testprocedure 17 revisions would lower themeasuredAFUE of many furnace 18 models anywhere from 0.3 to 1.0percentagepoints. 19 Inmany cases, theproposed testprocedure 20 revisions would have a cumulative effect of reducing 21 themeasuredAFUE of the furnace by an even greater 22 magnitude. 23 Asummary of testresults will be provided 24 with our written comments. 25 If DOE consults GAMA's Efficiency EXECUTIVE COURT REPORTERS, INC. (301) 565-006412 1 CertificationDirector, DOE will note that more than 15 2 percent of the furnace models listedhave AFUE ratings 3 between 78 percent and 78.2 percent. If retested and 4 reratedusing the proposed new testprocedures, most, 5 if not all, of these furnace models would no longer 6 meet theminimum standards, which is 78 percentAFUE. 7 DOE therefore is requiredbyNAECA to lower theminimum 8 standard. 9 GAMA understands thatunder the law, DOE 10 amendment of a testprocedure cannotmake a product 11 that complies withthe applicable federal minimum 12 efficiency standard suddenly non-compliant. However, 13 givenmarketplacerealities, this protection is 14 illusory. 15 The marketplace is certainto be confused by 16 a lowering of the federal minimum standard. Dealers 17 and consumers have gottenusedto the 78 percentAFUE 18 furnace standard. Itwill be difficult to sell a 19 furnace rated at less than 78 percentAFUE, even though 20 the furnace complieswith the amended federal minimum 21 efficiency standard. 22 utilityrebateprograms present a similar 23 problem. To be eligible for mostutilityrebate 24 programs, a furnace musthave an efficiencyrating of 25 at least 80 percentAFUE. Alook at the GAMA EXECUTIVE COURT REPORTERS, INC. (301) 565-006413 1 Efficiency certificationDirectory shows the extent to 2 which furnace manufacturers have arranged their 3 productionmix to take advantage of the 80 percent 4 utilityrebate criterion. 5 More than 20 percent of all the furnace 6 models listed inthe GAMA Directory are rated between 7 80 percent and 80.2 percentAFUE. If DOE amends its 8 testprocedures now to incorporate these proposed 9 changes, most, if not all, of these furnace models will 10 have tobe rerated andwill fail to qualify for utility 11 rebateprograms. 12 It is not realistic to expect that utilities 13 will promptlymodify their rebate eligibility criteria 14 to account for the effects of revised DOE test 15 procedures. Theywill not readilyunderstand the 16 significance of the testprocedurerevisions, and a 17 major effort to educate themwill be necessary. 18 We are stillhavingproblems getting gas 19 utilityemployees as well as consumers to understand 20 the differencebetweenthe old indoor gas furnace AFUE 21 and the newer isolated combustion systemgas furnace 22 AFUE rating. 23 Alook atwhathappened afterDOE amended its 24 testprocedures for electricwaterheaters also 25 illustrates thispoint. In October 1990, DOE issued EXECUTIVE COURT REPORTERS, INC. (301) 565-0064

### 14 1 revised testprocedures for measuring the efficiency of 2 residential waterheaters. Alongwith these revised 3 testprocedures, DOE issued an amendment to the Federal 4 Minimum EfficiencyRequirements for ResidentialWater 5 Heaters based on the revised testprocedures. 6 This amendment lowered theminimum energy 7 factor requirement for electricresidential water 8 heaters by 0.02. The implementation of therevised 9 testprocedures caused significantproblems inthe 10 marketplace, particularly inthe area of utilityrebate 11 programs. 12 Therewas major difficulty getting 13 organizations thathadrebate programs for electric 14 waterheaters already in effecttorecognize that as a 15 result of the revised testprocedures, the eligibility 16 criteria for therebateprogrammust be loweredby 17 

### 0.02. 18 Despite extensive efforts to educate 19 utilities, many rebateprogramswere very slow in 20 makingthe adjustmentrequiredbythe revised test 21 procedures. 22 MR. MARGOLIS: Excuseme. Why do the 23 utilitieshave tomake an adjustmentbecausewe've 24 loweredthe testprocedures? Theutilities couldhave 25 a rebateprogram at anyhigh level that theywish. EXECUTIVE COURT REPORTERS, INC. (301) 565-006415 1 They don't -- justbecause the Department lowers the 2 standard shouldhave no bearing on the ability. 3 Couldyou comment on that? 4 MR. MATTINGLY: The fact is that the utility 5 had setup a programwhere theyhad anticipated a 6 certainpercentage ofmodels ortypes of models to be 7 available for the rebateprogram. Then you changed the 8 criteria and the utility no longerhas those models 9 available to it. That affects its own marketingplans. 10 MR. MARGOLIS: But if theywant tohave a 11 higher -- I mean ifthey want to give a rebate, if 12 there's a higher level, that's all that this means, is 13 that they're cutting out the -- 14 MR. MATTINGLY: Well, 15 MR. MARGOLIS: -- thoseproducts at a lower 16 level. They'd stillhave the rebate. 17 MR. MATTINGLY: Well,-- 18 MR. MARGOLIS: If industrywants tomake a 19 more efficientproduct, they still could, and that 20 wouldmeet the rebate. 21 MR. MATTINGLY: Well, Gene, that's true. In 22 our past experience, itwasn't somuch that the 23 utilities didn't want to revise the criteria, they 24 thought that was tokeep theplaying field level. They 25 just didn't understand the changes thatwere required. EXECUTIVE COURT REPORTERS, INC. (301) 565-006416 1 I certainly, Gene, am not here to speak for 2 utilities. I am here, however, to speak for 3 manufacturers, and manufacturers who arrange their 4 productionmix to take advantage of certain product 5 utility rebate programs suddenly have all these models 6 can't comply any longer. That's a big problem for the 7 manufacturer, whether or not it's a problem for the 8 utility. 9 MR. MARGOLIS: Well, would it be any -- if 10 they would then make a more efficient machine, would 11 that solve the problem? To go back up -- 12 MR. MATTINGLY: Well,-- 13 MR. MARGOLIS:

-- to the higher level? 14 MR. MATTINGLY: Well, effectively, Gene, what 15 you may have accomplished in that case is you've raised 16 the efficiency standard, but you haven't raised the 17 efficiency standard according to the schedule that 18 NAECA laid out for DOE to amend efficiency standards. 19 That's not the way we see the world. That's not the 20 way itwas supposed to happen. 21 In this prior case I've been discussing, the 22 organization sponsoring the rebate programs either did 23 not understand that the water heaters themselves had 24 not changed, only the means of measuring their 25 efficiency, or theywere uncomfortable with using what EXECUTIVE COURT REPORTERS, INC. (301) 565-006417 1 appeared to be a less stringent rebate eligibility 2 criteria. 3 Even today, some utilities have still not 4 adjustedtheir rebateprogramcriteria to residential 5 electricwaters. If DOE adopts these proposed changes 6 at this time, industrywill have to spend substantial 7 resources retesting and reratingproducts and 8 pUblishing new product literature. These resources 9 will trulybewastedbecause no actual efficiency gains 10 will result from retesting and reratingproducts. 11 These resources couldbe better spent in 12 product research and development, which couldprovide 13 real benefits to consumers. 14 Some manufacturers have indicated to GAMA 15 that they will have to redesignproducts to increase 16 their efficiency in order tomaintain currentAFUE 17 ratings necessary for market acceptance or to qualify 18 for theutilityrebateprograms. 19 Such forced product redesign outside the 20 prescribedNAECA standards revision schedule is 21 contraryto the intent of the legislation. At the very 22 least, manufacturers shouldbe allowed sufficient time 23 for productredesign. Even oneyear from the date 24 DOE's final rule ispublished is not nearly enough 25 time. EXECUTIVE COURT REPORTERS, INC. (301) 565-006418 1 GAMA urges DOE to delay implementation of the 2 second category ofproposed testprocedure revisions 3 until the effectivedate of the next scheduledround of 4 NAECA Furnace and BoilerMinimum Efficiency Standards. 5 We recognize that DOE is requiredby lawto amend its 6 testprocedures to incorporatewaivers previously 7 granted. 8 However, there is no legal requirement for 9 DOE to adopt these otherproposedrevisions at all, 10 much less at this particulartime. If DOE believes 11 that it lacks the authority toprescribe a delayed 12 effective date for its final rule orpart thereof, then 13 DOE should amend its testprocedure to incorporate the 14 first category ofproposed changes described previously 15 and terminate the rulemaking. 16 DOE can starta new rulemaking to incorporate 17 otherproposed changes at a later date. In that case, 18 we would recommend that in the preamble to its final 19 rule adopting the first category of changes, DOE 20 declare its intentionto adopt the otherproposed 21 changes in a laterrulemaking

.. 22 Letme now go in to some of the problems 23 whichwouldresult from adoption anduse of the 24 proposed annual efficiencyAE energy descriptor. 25 First, anyminimumAE standardwouldhave to EXECUTIVE COURT REPORTERS, INC. (301) 565-006419 1 employ a sliding scale based on furnace air flow rate 2 because the electrical consumption of a gas or oil 3 furnace will increase withhigher air flow rate. 4 Higher air flow rates are required in areas where 5 summer temperatures are high in order tomaintain air 6 conditioning efficiency. 7 Any new furnace minimum efficiency standard 8 should not beprejudiced against furnaces to provide 9 the air flow neededtomaintain air conditioning 10 efficiency. 11 Second, sincetheproposedAE descriptor is 12 not applied to electricresistance furnaces, consumers 13 would probably get the wrong impression that an 14 electricresistance furnace with a 100 percent 15 efficiencyratingwouldhave a lower cost of operation 16 than a gas or oil furnace having an 80 percentAE 17 rating. 18 AthirdproblemwiththeproposedAE 19 descriptor is that two gas furnaces having the same AE 20 couldhave significantlydifferent operating costs. 21 Afurnace having a higher electrical 22 consumption and a lower gas consumption than another 23 furnace with the sameAE rating couldhave a higher 24 cost of operation. 25 Fourth, any labellingrequirement or other EXECUTIVE COURT REPORTERS, INC. (301) 565-006420 1 requirement for disclosure of annual efficiency or 2 other efficiency descriptor in advance of new federal 3 efficiency standards based on the new descriptor would 4 cause considerable confusion in the marketplace which 5 has become accustomed to the use of theAFUE 6 descriptor, and it could have significant adverse 7 effects onmanufacturers. 8 Even if the Federal Trade Commission does not 9 prescribe new labellingrules based on annual 10 efficiency, state and utility sponsored incentive 11 programs could bemodified to use AE as an eligibility 12 criterion, especially if it is anticipated that DOE 13 will prescribe revised NAECA standards based on AE. 14 This would disrupt manufacturers' product 15 planning, require rerating of all furnaces and probably 16 also result in sUbstantial productredesigns which 17 would require retesting for efficiencyratings. 18 DOE has recently commenced a rulemaking 19 proceedingto considerpossible revision of the NAECA 20 minimum efficiency standards for furnaces and boilers. 21 Revised standardswouldbe effective some time after 22 2002, depending onwhen the final rule ispromulgated. 23 Understandably, DOE may wish to base its 24 proposals for revisedNAECA furnace and boiler 25 standards on theproposed testprocedurerevisions, in EXECUTIVE COURT REPORTERS, INC. (301) 565-006421 1 particular the annual efficiencyAE descriptor or some 2 modification thereof. 3 GAMA supports consideration of electrical 4 consumption in the establishment of the next round of

5 furnace and boilerminimum efficiency standards. GAMA 6 members are reviewing this issue and will develop a 7 suggested solutionwhich may require the use of two 8 efficiency descriptors for gas and oil furnaces and 9 boilers. One descriptor would be for gas or oil 10 consumption, and the other would be for electrical. 11 Any new descriptor and other proposed new 12 test procedure provisions do not have to be in effect 13 or even formally adopted at the time DOE issues a 14 revised standards proposal. In proposing new furnace 15 and boiler standards, DOE simply needs to make its 16 intentions clear as to what descriptors and test 17 procedures the proposed revised standards will be based 18 on. 19 GAMA expects that in the very near future, 20 DOE will publishproposed amended efficiency standards 21 for mobile home furnaces. The proposed new standards 22 may be based on the annual efficiency descriptor, and 23 in anticipation of publication of final standards, DOE 24 may wish to have the annual efficiency descriptor or 25 some modification thereof in the furnace test EXECUTIVE COURT REPORTERS, INC. (301) 565-006422 1 procedures as soon as possible. 2 If that is the case, DOE should amend the 3 furnace test procedures to adopt the new descriptor, 4 but for now, make the new descriptor applicable only to 5 mobile home furnaces. 6 Mobile home furnaces aremarketed in a very 7 differentway than are furnaces and boilers generally. 8 Adoption of a new descriptor for mobile home furnaces 9 will not present the same potential for marketplace 10 confusion and adverse impacts onmanufacturers that 11 adoption of this descriptor for all furnaces and 12 boilers would. 13 However, if DOE does choose to adopt a new 14 energy descriptor for mobile home furnaces, it needs to 15 recognize and avoid the problems noted previously, such 16 as the sliding scale standards requirements. 17 As previously indicated, GAMA supports 18 immediate amendment of the testprocedures to 19 incorporatewaivers previously granted relating to 20 blower time delay and the use of combustion air 21 dampers. 22 However, we oppose DOE's proposal to specify 23 a minimumblower delay time of 20 seconds during the 24 heat-up test ifthe designed unvarying delay time is 25 less than 20 seconds. We also oppose DOE's proposal to EXECUTIVE COURT REPORTERS, INC. (301) 565-006423 1 require furnaces that have an unvarying time delay that 2 does not allow for a longer blower delay time than the 3 blower delay time specifiedduring the cool-down test 4 to be tested with the fan control bypass and the blower 5 manually controlledto give the unspecified delay time, 6 to give the specified delay time. 7 DOE cites cold drafts and a reasonable level 8 of occupant comfort as its rationale for these proposed 9 deviations from theASHRAE standard. DOE is acting 10 outside its authority in factoring occupant comfort 11 into its efficiencytestprocedures. DOE also needs to 12 recognize there are nine options now available which 13 providemanufacturers the capability of devising blower 14 operating schemes that ensure occupant comfort and 15 enhance appliance efficiencyyet utilize timings that 16 are restrictedby both current DOE requirements and 17 DOE's proposed revisions. 18 It is the function of the marketplace, not 19 DOE, to discourage the sale of furnaces that do not 20 provide a reasonable level of occupant comfort. 21 In addition, GAMA questions proposed 22 revisions to section 8 of the DOE Furnace Test 23 Procedureswhich seemto be an attempt to account for 24 electrical energyconsumedby the combustion blower 25 duringpost-purge and the electrical energy consumedby EXECUTIVE COURT REPORTERS, INC. (301) 565-006424 1 electrical intermittent or interrupted ignition 2 devices. 3 During studies of such conditions, the 4 electrical energy consumed for the purposes of ignition 5 and post-purge wouldbe zero. Nonetheless, GAMA is 6 opposed to any revision to the Furnace Test Procedures 7 thatwould attempt to account for energy consumed by 8 the combustion blower duringpost-purge and by 9 intermittent or interrupted ignition devices. 10 GAMA believes that the time and effort 11 necessary for accuratelymeasuring this extremely small 12 amount of energy is not economicallyjustified. GAMA 13 also believes that DOE testprocedures should not 14 influence the decision of furnace manufacturers 15 regardingwhich intermittent or interrupted ignition 16 devices to use. 17 All right. That's all for furnaces and 18 boilers. I justhave a fewmore comments relating to 19 the otherproducts. 20 First, withrespect toVented Home Heating 21 Equipment, GAMA full supports theproposed revisions to 22 DOE's Test Procedures for Vented Home Heating Equipment 23 relatingto pilot light energy consumption andweighted 24 average steady state efficiencyand encourages their 25 adoption. EXECUTIVE COURT REPORTERS, INC. (301) 565-006425 1 However, for the reasons noted previously, 2 GAMA does not support adoption of an annual efficiency 3 descriptor for ventedhome heating equipment at this 4 time. As with furnaces and boilers, GAMA members that 5 manufacture ventedhome heating equipment are reviewing 6 this issue andwill develop a suggested solutionwhich 7 may also require theuse of two energydescriptors, one 8 for gas consumption and one for electrical consumption. 9 with respect to Pool Heaters, DOE has also 10 proposedto adopt annual efficiency as an additional 11 energy descriptor. The AE descriptorwould account for 12 the annual energy consumption of continuous burning 13 pilots and the electrical energy consumption of 14 auxiliary equipment, in addition to the thermal 15 efficiency of the pool heater. 16 Withrespect to types of auxiliary equipment, 17 the use of a recirculatingpump shouldbe factored in 18 theAE descriptor only if it isused during the thermal 19 efficiencytestunder section 2.8.1 ofANSI C-2156- 20 1990. Not allpool heater designs employ a 21 recirculatingpump duringthe thermal efficiencytest. 22 In addition, the pump used on any given 23 installation inthe field wouldbeunknown to the pool 24 heatermanufacturer. Pool filter pumps are not 25 associatedwith theuse of a pool heaterbutwith the EXECUTIVE COURT REPORTERS, INC. (301) 565-006426 1 pool itself, and should not be considered as auxiliary 2 equipment. 3 GAMA recommends that DOE focus on addressing 4 a pool heater's primary electrical energy consumption 5 rather than auxiliary losses. This will be useful in 6 future rulemakings for electric and gas-fired heat pump 7 pool heaters. 8 Under proposed section 4.2, DOE has defined 9 the average number of burner operatinghours as being 10 104 hours, but does not indicate the average pool and 11 pool heater size this is based on. Under DOE's AE 12 descriptor proposal, 100,000 BTUs per hour and 400,000 13 BTU per pool heaters could have the same AE value. 14 This would give the impression that a 400,000 BTU per 15 hour pool heater is an effective choice for heating a 16 500 gallon hot tub. Based on this, the DOE proposedAE 17 descriptor would not be useful to the consumer. 18 GAMA urges DOE not to adopt its proposedAE 19 descriptor for pool heaters, but, instead, to develop a 20 methodology to calculate total annual energy 21 consumption based on thermal efficiency, electrical 22 energy consumption and continuous pilot consumption. 23 Consumers could thenuse this information to 24 estimate annual energy consumption and operating costs 25 applicable to a specific pool size and season of EXECUTIVE COURT REPORTERS, INC. (301) 565-006427 1 operation. 2 Finally, if the DOE's mainreason for 3 proposing an AE descriptor is to discourage the use of 4 continuous burningpilots, GAMA members that 5 manufacture pool heaters would be receptive to 6 supporting a proposedprescriptiverule toprohibit 7 suchpilots, rather than further complicating the pool 8 heater efficiencytest procedures. 9 It shouldbe noted that duringpool non10 seasonhours, the continuous pilot isusually shut off. 11 GAMA realizes that DOE plans to publish a 12 proposed rule in the near future to revise the NAECA 13 minimum efficiency standards for water heaters and pool 14 heaters. Any changes to the pool heater test 15 procedures should bemade to coincidewith the 16 effective date of revisedpool heaterminimum 17 efficiency standards. 18 This concludes GAMA's prepared statement, and 19 Jack and I would behappy to tryto answer any 20 questions you have at the appropriate time. 21 Thankyou. 22 MR. ADAMS: Thankyou for your testimony, and 23 I do have some questions. 24 25 now? MR. MATTINGLY: Would you like to do them

EXECUTIVE COURT REPORTERS, INC. (301) 565-00641 MR. ADAMS: Yes. You may not have all the 2 answers with you today, and certainly 3 4 MR. MATTINGLY: I'mwilling to bet I don't. MR. ADAMS: itwould be helpful if you'd 5 address them inyour written comments. 6 You indicatedthat the reference test data 7 would accompany your written statement. However, 28

8 regardingyour second category of proposed changes, you 9 statedthat "testresults show that individualproposed 10 test procedurerevisions would lower themeasuredAFUE 11 of many furnace models anywhere from 0.3 to 1.0 12 percentagepoints". 13 Does thatmean that you tested each of the 14 eightmodifications listed individually and that each 15 one taken by itself lowered the AFUE from 0.3 to 1.0? 16 That's not a package number for each one? 17 MR. MATTINGLY: Right. I don't know thatwe 18 tested every singleproposed change. We tested several 19 of the proposed changes, and inmany of those cases, 20 the individualproposed testprocedure revision did 21 lower itby that factor. 22 Do youhave anything to add to that, Jack? 23 MR. LANGMEAD: Jack Langmeadwith GAMA. 24 Carl, I thinkwe tested five. We have just 25 had an ETL from five. It's individual manufactured EXECUTIVE COURT REPORTERS, INC. (301) 565-006429 1 data on the other, and each one of them, each one of 2 the test procedures, each one of the ones we did at 3 ETL, incorporatedjust one of the changes compared to 4 the other, andwe haven't done any cumulative work yet, 5 butwe will do that and have that in. 6 DR. KELLY: You are going to provide that 7 then? 8 MR. LANGMEAD: Yes, sir. 9 DR. KELLY: will youprovide the model number 10 andmakes, too, for us? 11 MR. LANGMEAD: Yes. 12 DR. KELLY: Okay. 13 MR. LANGMEAD: I can give you some of that 14 data earlierthan the close of the comment period and 15 some we're still generating. 16 MR. ADAMS: Okay. As soon as you can provide 17 it, we'll be interested to look at it. 18 MR. LANGMEAD: Very good. 19 MR. ADAMS: Does GAMA have comparable data 20 for the 12 modifications listed as category I? Did you 21 test any of those individually? 22 MR. MATTINGLY: Why don't you take that 23 again, Jack? 24 MR. LANGMEAD: We haven't done any testwork 25 at ETL on that, butthemanufacturers have, and they EXECUTIVE COURT REPORTERS, INC. (301) 565-006430 1 all agreed that those changes, which are based on 2 waivers thatwere granted, are already accounted for in 3 the currentAFUE number. Those changes don't lower the 4 number. 5 MR. ADAMS: Okay. Well, not all of those are 6 waiver

7 MR. LANGMEAD: But -- and, so, we tried to 8 make the breakpoint notwhatwas waivers but those 9 things thatwouldhave an adverse effect on the current 10 AFUE rating. We saidwe adopt everythingwe could that 11 didn't lower the rating. 12 MR. ADAMS: Do any of those raiseAFUE of the 13 category 1 that you tested? 14 MR. LANGMEAD: Yes. Oh, of the ones we 15 tested on category 1? We didn't test, the 16 manufacturers tested, but I'm sure some of those raised 17 theAFUE rating, yes. 18 MR. ADAMS: Okay. If DOE were to implement 19 only the category 1 modifications, does GAMA have an 20 estimate as towhat the averageAFUE increasemight be 21 for a marginally complyingunit? 22 In otherwords, if only category 1 23 modifications were implemented, would your data refute 24 or support any argument that DOE would berequired to 25 raise the standard? EXECUTIVE COURT REPORTERS, INC. (301) 565-006431

1 MR. LANGMEAD: Again, most of the revisions 2 in there are already inplace because they -- and taken 3 and accounted for in the currentAFUE ratingbecause 4 they were the subject of grantedwaivers. 5 We will look at all other things thatweren't 6 the subject of standardwaivers andprovide you that 7 information in the written comments. 8 MR. ADAMS: Okay. Then, regardingthe third 9 category, the proposed new descriptor annual 10 efficiency, I guess I want to be clear inmy 11 understanding that not only are you advocating that 12 annual efficiency should not be used as the basis of 13 theminimum efficiency standarduntil the next 14 scheduled round of NAECA rulemaking, but also that DOE 15 should not even include the descriptor in the test 16 procedure until then. 17 Is that a correctunderstanding of your 18 position? 19 MR. LANGMEAD: Yes. It shouldn't be included 20 in the testprocedure for all -- ifyou need it for 21 mobilehome furnaces, do it for onlymobile home 22 furnaces. Buthave it -- do the rulemaking so that 23 it's inthe testprocedure, and that -- so it's in the 24 testprocedure coincidentwith the next round of NAECA 25 standards. EXECUTIVE COURT REPORTERS, INC. (301) 565-006432 1 MR. MATTINGLY: You might want to put it in 2 the testprocedure at some future date and project out 3 the effective date, youknow, a 180 days or 360 days, 4 to coincidewith the effective date of the next NAECA 5 standards. 6 MR. ADAMS: Okay. You statedthat since the 7 proposedAE descriptor is not applied to electrical 8 resistance furnaces, consumers willprobably get the 9 wrong impression that an electricresistance furnace 10 with a 100 percent efficiencyratingwouldhave a lower 11 cost of operationthan a gas or oil furnace having an 12 80 percentAE rating, and also that state and utility 13 sponsored incentiveprograms couldbe modified to use 14 annual efficiency as an eligibilitycriteria. 15 The currenttestprocedure contains an unused 16 energy descriptor, the energy factor, whichmeasures 17 furnace efficiency, including electrical consumption, 18 when the furnace is installed as an isolated combustion 19 system. 20 Sincetheproposed annual efficiency 21 descriptor is essentiallythe samemeasure as the 22 energy factor, except for being an indoor installation, 23 couldyou include inyourwritten comments if these 24 same concerns applyto the existingenergy factor? 25 MR. LANGMEAD: Okay. We can do that. EXECUTIVE COURT REPORTERS, INC. (301) 565-006433 1 MR. ADAMS: Likewise, you mentioned some 2 technical problems regarding air flow and how the gas 3 and electrical consumptionmight be combined orwhether 4 they shouldbe kept separate. 5 Do these concerns also apply to the existing 6 energy factor? 7 MR. LANGMEAD: We can address that, Carl, but 8 the existingenergy factor ismultiplied by a source 9 energy, whichmagnifies the problem. 10 MR. ADAMS: That's true. Thatmay be 11 something thatwe forgot to do. 12 You've indicatedthat furnace and vented home 13 heating equipmentmanufacturers are looking into 14 resolving these issues regarding the annual efficiency 15 descriptor, knowing that DOE mightproposed efficiency 16 standards for mobile home furnaces and ventedhome 17 heating equipment in anupcoming rulemaking. 18 SinceDOE might do that, itwould be helpful 19 if thoseproposed solutions were inyour written 20 comments. I don'tknow what your time schedule is with 21 themanufacturers to resolve those issues, but the 22 sooner the better for us, I believe. 23 MR. LANGMEAD: Carl, just inresponse to 24 that, to tryto get industry concurrence on that point 25 inthatperiod of time is goingto be very difficult. EXECUTIVE COURT REPORTERS, INC. (301) 565-006434 1 We will go as far as we can in ourwritten 2 comments, but I wouldbevery optimistic to say that we 3 canresolve that issue and get concurrence of the 4 industry in that period of time. 5 MR. ADAMS: Okay. And then, lastly for 6 myself, regardingproposed changes relating to blower 7 time delay, you statedthat there are design options 8 now availablewhichprovidemanufacturers the 9 capability of devisingblower operating schemes that 10 ensure occupant comfort and enhance appliance 11 efficiencyyet utilizetimings that are restricted by 12 both current DOE requirements and DOE's proposed 13 revisions. 14 For the record, would youprovide to DOE what 15 those design options are? Also, could youprovide 16 GAMA's opinionregardingthe ease or difficulty of an 17 installermodifying an unvaryingblower time delay of 18 less than 20 seconds to a longer delay in the event of 19 a consumer complaint of discomfort? In otherwords, 20 somebody complains that theyhave -- the furnace is not 21 workingproperly, how hard or easywould itbe for 22 someone to change a shorttime delay? 23 MR. LANGMEAD: We will include that in the 24 written comments. 25 MR. ADAMS: Okay. That's all the questions EXECUTIVE COURT REPORTERS, INC. (301) 565-006435 1 that I have. 2 Cyrus, do youhave any additional questions? 3 MR. NASSERI: I think youkind of covered 4 most of the things I was concernedwith. 5 One thing that we have asked in the notice 6 was comment on input/output test as compared to what we 7 have, and as I recall, GAMA had a contract awhile back 8 with ETL to review that, and we haven't heard anything 9 on that issue. 10 I would like to see ifyouhave any comments. 11 If there is any data available, you're going to submit 12 that to us at this time or not. 13 MR. LANGMEAD: Cyrus, we don't have any data 14 to submit for the record at this time, but I can tell 15 you that the results of the work we've done is we have 16 a great deal of difficulty in repeating the tests from 17 one time to the next, and a great deal of difficulty in 18 correlating the efficiency ratingwith what the 19 efficiencyrating currently is. 20 So, themethod we're using, that method test, 21 needs work, and itprobably needs -- if somebodywants 22 to go thatway, it'sgoing to take -- maybe George can 23 give a better estimate than I can on it, but I see 24 three or four years worth of work to even come close on 25 that method of testing. EXECUTIVE COURT REPORTERS, INC. (301) 565-006436 1 MR. NASSERI: Okay. I don't have anymore 2 questions. 3 MR. ADAMS: George? 4 DR. KELLY: Yes. Joe and Jack, I would like 5 to clarifyGAMA's position on the second category of 6 proposed changes. 7 If I may put it inmy own words, I guess 8 you're saying thatyou feel itwould be unfair for the 9 Government tomake these changes because itmight lower 10 someunits that arejustmarginally above theminimum 11 level, might have their efficiency lowered because of 12 these changes, and thatwould be unfair. 13 Is thatwhat you're saying? 14 MR. MATTINGLY: Well, I would say, first of 15 all, itwould be unfair and unwise from everybody's 16 perspective to do it at this time. That's onlypart of 17 our concerns, though, is the effect that some of them 18 will no longermeetthe now market accepted 78 percent 19 minimum number.

20 DR. KELLY: Let's say I'm a manufacturer, and 21 I make a natural gas-fired furnace, a boilerthat 22 doesn'tmeet theminimum standard. So, if I'm a boiler 23 manufacturer and I install a vent damper or furnace, I 24 might install a powerventedunit, okay, tomeet the 25 minimum standards, and I meet in, and that's what the EXECUTIVE COURT REPORTERS, INC. (301) 565-006437 1 minimum standardswas intended to do, right? 2 Now, if I discover thatbecause of some holes 3 inthe testprocedure, if I allowthatpost-purge 4 period and allowthe blower to run, the combustion 5 blower to run for awhile after that, I get an even 6 higher efficiencynumber, or if I don't closemy stack 7 damper right away, I get a higher efficiencynumber. 8 So, I put in a less effectiveheat exchanger, 9 and I get -- I stillmeetminimum standards. Now, I 10 know I have a furnace that's less efficient, I know the 11 heat exchange is less efficient, I know that I'm 12 dumping heat'out the stack, but yet I stillmeet the 13 minimum efficiencynumber, is that fair? 14 MR. MATTINGLY: Is itfair? 15 DR. KELLY: Yes. Is it fair? Is thatwhat 16 you -- do you think it's fair for a manufacturer to do 17 that or for -- 18 MR. MATTINGLY: Well, theway that the 19 standards are set arebe itthe standardprescribed by 20 DOE or be it legislated likethe initial standards 21 were, itwas theywere supposedto allowthe 22 manufacturer tomeettheminimum efficiency standard 23 anywayhe can. 24 DR. KELLY: Okay. But ifhe finds loopholes 25 inthe testprocedurethat effectively allows him to do EXECUTIVE COURT REPORTERS, INC. (301) 565-006438 1 things that obviously are not in the interests of the 2 country, not in the interests of the consumer, as long 3 as he meets that efficiency number, that's okay? 4 MR. LANGMEAD: George, you know, the 5 difference between -- there is a difference between 6 allow and has happened. 7 The -- I know of no manufacturer that's ever 8 reduced the effectiveness or would even consider 9 reducing the effectiveness of a heat exchanger because 10 he added a post-purgeperiod. The post-purge period is 11 added for another reason, and nobody is going to go 12 back and redesign their furnace and spend the money to 13 lower the efficiencyrating or to lower the efficiency 14 of the heat exchanger. Itjust isn't going to happen. 15 DR. KELLY: Well,-- 16 MR. LANGMEAD: So, it doesn't have to be 17 worried about is what I'm saying. 18 DR. KELLY: -- some of themmay have 19 discovered that if they do the post-purge period, they 20 actually get a higher efficiencynumber because of 21 the -- may be a hole inthe testprocedure. 22 Most of these changes here in category 2 are 23 patches to holes inthe test procedures. okay? If you 24 want toprevent a manufacturer from, letme put the 25 word inquotes, cheating, okay, running the blower from EXECUTIVE COURT REPORTERS, INC. (301) 565-006439 1 long purgeperiods or not closing the damper right away 2 and gettinghigher efficiency numbers than he actually 3 should or of putting louvers in it so thathe doesn't 4 have anyjacket losses for his isolated combustion 5 jackettest orremoving insulation in certainplaces so 6 thathe gets lowertemperature numbers. 7 All these are sort of patches to sort of 8 prevent cheating. Now, you're turning it around, and 9 you're saying thatthat's okay, but it'sunfair for the 10 Government to plugthose holes because you're saying 11 now that these units that are obviously cheatingwill 12 notmeet the minimum standards if they'remade to do it 13 right? 14 MR. MATTINGLY: First of all, as Jack said, 15 you say thesemodels are obviously cheating, you 16 haven't cited anyparticular examples. 17 DR. KELLY: I cited long running of the post18 purge or leaving the stackdamper open for periods of 19 time. That's whatthesepatches are for. Okay? 20 I meanwe have them inthere. The standards 21 right now covers closing stackdampers and closes power 22 ventedunits. Itjustdoesn't include -- whathappens 23 if you do a fewmore littleperturbations or tricks 24 upon them? 25 MR. LANGMEAD: George? EXECUTIVE COURT REPORTERS, INC. (301) 565-006440 1 DR. KELLY: And these are to close the holes. 2 MR. LANGMEAD: George, we have no objection 3 to the adoption of the revisions in category 2. We 4 have objection to the timing of the adoption of the 5 revisions in category 2, and I kind 6 DR. KELLY: But it's not going to affect 7 those units that are doing itright now. It's only 8 going to affect those units that have deliberately gone 9 to, let's say, less than normal -- 10 MR. LANGMEAD: Insulating the draft to it, 11 insulating the stack is going to affect virtually every 12 unit. Anumber of these changes would affect virtually 13 every unit on the marketplace. 14 Now, we can deal with each one of those in 15 more detail -- 16 DR. KELLY: You should, you should. 17 MR. LANGMEAD: -- in our written comments. 18 DR. KELLY: I think you need to break out 19 each one of those things, okay, because the first two 20 are definitely aimed at gettingpeople that are doing 21 maybe less than stuff inmy opinion at the moment. 22 Okay? 23 MR. LANGMEAD: Okay. 24 DR. KELLY: And some of the louvers, for 25 instance, too, thathave been added to a lot of units EXECUTIVE COURT REPORTERS, INC. (301) 565-006441 1 in recent years, so that now there's no jacket losses. 2 That is just a way -- many of these things are methods 3 of getting a bettermeasurement. Okay. 4 You're saying insulation is really to get a 5 better flue management. Okay. The blocking of the 6 louvers is to get a betterjacket loss measurement. Of 7 course, you're losingthat heat anyway. Okay? It's 8 justthat it's going in convective losses instead of 9 conduction losses, and it's a way of trying to account 10 for it in a different form. 11 MR. LANGMEAD: Ormaybe it's a way to 12 ventilate the cabinet of the heat

-- of the unit to 13 make the controls last longer and operate better over a 14 longer period of time, and thus are very cost 15 effective. 16 DR. KELLY: It couldbe, but if we can 17 measure the jacket losses thatway, itwould be fine, 18 but

-- 19 MR. LANGMEAD: We will deal with each one in 20 the written comments·inmore detail thanwe have here. 21 DR. KELLY: Okay. 22 MR. LANGMEAD: And its impact. The-- 23 DR. KELLY: I thinkyou need to address how, 24 if it'sused as was originally intended in the test 25 procedures, whether ithas an impact at all, or if used EXECUTIVE COURT REPORTERS, INC. (301) 565-006442 1 in an appropriate way, like longpost purges, you know, 2 what effect that has on it. 3 MR. LANGMEAD: George, and I thinkwe want to 4 be absolutely clearhere, that the issue is notwhat 5 but it'swhen. 6 We are not opposed to the adoption of those 7 provisions. It's how they get implemented and their 8 impact on the process, the amount of work thathas to 9 be done to go back and reset a newminimumunder the 10 current size. with enough time, we can adjust to those 11 things. We can't do it, and, unfortunately, the law is 12 reasonably clear on the amount of time that it takes 13 after you publishyour proposed revision to make it 14 effective, and it's too darn short. You can't do it in 15 that period of time. 16 So, it's an issue of what, not when, butwe 17 will address, try to address your concerns in the 18 written comments. 19 MR. MATTINGLY: Letme just add to that, that 20 DOE has to understand thatwhether you think the 21 current test procedurehas a lot of loopholes in it or 22 not, if I testmy product according to that test 23 procedure, thenyou change the testprocedure onme, 24 and itreduces my AFUE, and if thathappens a 25 significant number of instances, DOE has an obligation EXECUTIVE COURT REPORTERS, INC. (301) 565-006443 1 to go to the trouble to amend the test

-- the minimum 2 standards with all that that entails, and, you know, if 3 we had some accommodation as to timinghere, you know, 4 maybe we could avoid some of that. 5 Butyou reallyhave to ask yourself whether 6 you want to go to that trouble, and, secondly, you got 7 to recognize the actualmarket impact of what you're 8 doing. 9 DR. KELLY: Okay. So, you're saying that 10 it's okay for a manufacturer to cheat, but it's not 11 okay for the Government to catchhim because that may 12 make stop him from cheating? 13 14 15 MR. MATTINGLY: Anybody who follows

-- DR. KELLY: Is that right? MR. MATTINGLY: your current test 16 procedures is not cheating. 17 DR. KELLY: Oh. 18 MR. MATTINGLY: You prescribed the test 19 procedures. If I follow it, you can't accuse me of 20 cheating. 21 DR. KELLY: So, you can find anyhole you 22 want, and even if it's obvious thatyou're throwing 23 heat away and that's okay. Is thatwhat you're saying? 24 Is thatwhat GAMA is saying? 25 MR. MATTINGLY: You know that's not what I'm EXECUTIVE COURT REPORTERS, INC. (301) 565-006444 1 saying. 2 DR. KELLY: It sounded like itto me. 3 MR. MATTINGLY: No, that's not what I said, 4 and ifyou want to read the record back, you'll see 5 that I didn't saythat at all.

6 MR. MARGOLIS: If there is a loophole in the 7 testprocedure, that would be, say, the fault of the 8 Department of Energy for not catching it, and ifwe do 9 know about it andwe do catch it, we will make 10 amendments to the testprocedure. 11 A similar situationhas happened in the 12 clothes washer testprocedure. We found out about it 13 because itwas mentioned to us by one of the companies, 14 andwe have put out on the street an amended test 15 procedure. 16 But if the test procedure does read a certain 17 way, thenmanufacturers canuse that test procedure, 18 and if itmeans a lower or a higher, not lower, a 19 higher energy factor, that's the way it comes out, and 20 we would have tomake amendments. The manufacturers 21 will not be informed for interpreting the test 22 procedure the way it'swritten. We've had that 23 problem, unfortunately. 24 MR. MATTINGLY: We're not saying that DOE can 25 never amend its testprocedure. That's a ridiculous EXECUTIVE COURT REPORTERS, INC. (301) 565-006445 1 position to take, and one we're not taking. We're just 2 saying understand there's market impacts here, and also 3 some additional obligations for DOE. 4 Canwe do this in a way that doesn't create 5 all that confusion, additional expense to 6 manufacturers, and, for that matter, additional 7 workload to DOE? 8 MR. LANGMEAD: And I think, you know, the -- 9 I object to the use of the term "manufacturers 10 cheating" because I don't think anybody is. There were 11 things that -- there was a test procedure there, people 12 designed products. Everybody has agreed to go ahead 13 and adopt at some point in time all of the proposed 14 revisions contained in our Category 2 revisions. 15 The issue again is not whether to adopt it. 16 There's agreement there, and everybodyworking at this 17 point in time, any new products being developed on old 18 product, if itgoes through any changes, those 19 processes are being changes are being put in, the 20 product's being looked at, in accordance with those 21 because they know they're going to be adopted 22 eventually. 23 It's a timing issue of getting from where we 24 are today towherewe should be, and the time isn't 25 enough, and topostpone their adoption allows a cost EXECUTIVE COURT REPORTERS, INC. (301) 565-006446 1 effective responsible transition into an improvement of 2 the test procedure, andwe would like to see that. 3 But we'd like it in a responsible time period 4 to allow the change to go through in an orderly fashion 5 without costing significant sums of money that result 6 in almost no energy saving. 7 MR. ADAMS: Okay. I believe that we have 8 sufficiently aired this issue. 9 MR. MATTINGLY: Thatwas getting enjoyable. 10 MR. ADAMS: Do you have any other questions? 11 DR. KELLY: Just one on a different subject. 12 You expressed concern about new energy descriptor and 13 misinterpretation for electric furnaces. 14 Would GAMA recommend that the F factor be 15 applied to electric furnaces then? 16 MR. LANGMEAD: Yes. 17 DR. KELLY: Okay. 18 MR. LANGMEAD: We didn't suggest -- we say we 19 ought to be accounting for electrical energy. 20 DR. KELLY:" Right. 21 MR. LANGMEAD: And we will try to work in a 22 process that will look at a descriptor, but itmay 23 require two. We'd like to be able to combine it in 24 one, but I don't see how we're going to in order to be 25 able to take that descriptor and get back to the cost EXECUTIVE COURT REPORTERS, INC. (301) 565-006447 1 of operation, and cost of operation is the key point 2 that we have to get to. 3 We've got two different costs of energy, and 4 all the decision the consumermakes is going to be 5 based on cost, and the way the descriptor is proposed, 6 you've got to get the cost some different way, and it 7 makes itvery complex. 8 DR. KELLY: So, don't you think two factors 9 plus the cost is justgoing to confuse the consumer 10 evenmore? 11 MR. LANGMEAD: Itmay. That's why I saidwe 12 couldn't solve that issue between now and the end of 13 the comment period. Exactly that reason. 14 MR. ADAMS: James, any questions? 15 MR. MILLS: I have no questions. 16 MR. ADAMS: Eugene? 17 MR. MARGOLIS: When you were mentioning that 18 the test procedures need not be amended now and could 19 be mentioned in the standard rulemaking for furnaces, 20 and youwere saying that thatwould -- all of that 21 would be necessary, it seems tome that you being a 22 lawyer, that the statute says thatwe have to have in 23 place before we promulgate standards a testprocedure 24 which the standards are based on, so if we don't put 25 into effect today or tomorrow or nextweek a test EXECUTIVE COURT REPORTERS, INC. (301) 565-006448 1 procedure that thenwould be used subsequently for the 2 standards, I don't understand how you can say that at 3 the time we would propose standards or promulgate 4 standards, allwe have to do then is mention the new 5 type of test procedure. 6 MR. MATTINGLY: Well, the problem

-- first of 7 all, I did a littlework on trying to determine if you 8 couldprescribe a delayed effective date for your test 9 procedure revisions and frankly had a lot of trouble 10 coming up with a good argument for how you could do 11 that. 12 It does seem like under the current language 13 of the law, a test procedure revision become effective 14 a 180 days after you publish it in the Federal Register 15 or you get a 180-day extension of time. So, that 16 presents a that removes some of the freedom DOE 17 might have in timing its actual adoption of test 18 procedure revisions. 19 But, Gene, whatwe would do, we would 20 propose, this wouldrequire some delicate timing on 21 your part in the future, butwe would say thatyou 22 could go ahead with a rulemaking on your standards 23 proposal and try to be clearwhat test procedure, 24 actual test procedures your proposed standards are 25 based on, but then it's not so important thatyour test EXECUTIVE COURT REPORTERS, INC. (301) 565-006449 1 procedure actuallybe adopted at the time that the 2 proposed standard is promulgated. 3 What'smore important, and we think all the 4 lawrequires, is that the testprocedure be in effect 5 at the time that the revised standardbecomes 6 effective, so that at some point in the future, you 7 wouldhave to -- initiallywould have to publish a 8 final rule adopting these other testprocedure changes 9 about, youknow, sixmonths or a year in advance of 10 when the proposed standards, youknow, new standards 11 are going to be effective, so that at that time, when 12 they become effective, these testprocedures, new test 13 procedures, are inplace. 14 Butwe're not saying -- they don't have to be 15 in place, youknow, sixyears orwhatever it is before 16 you -- the revised standard levels actuallybecome 17 effective. 18 MR. LANGMEAD: And ifwe know what those are, 19 we cando the testwork and provide to DOE and its 20 contractors the cost efficiencyrelationship of what 21 those will be in the rulemakingprocess, so that it 22 will be a known factor of what we're providing. 23 We've to at leastprovide for DOE tomake a 24 decision onwhat the standard level is goingto be. 25 It's goingto have to go through its analysis, and that EXECUTIVE COURT REPORTERS, INC. (301) 565-006450 1 analysis is goingto have to be based on the efficiency 2 rating you get under a testmethod. Itwill be the 3 test methodplus some intendedrevisions that are going 4 to be effective at a given date. 5 MR. MARGOLIS: Would you educateme, because 6 I don't understand, what is the problem of having a 7 testprocedure inplace, even as you said, sixyears 8 before a standard is inplace? Atest procedure is a 9 testprocedure. It says how youwill test. There is 10 no penalties. There is no stringency levels. It's 11 justtellingyou how to test, and ifwe don't come out 12 with standards for 30 years, what is the harm in having 13 a testprocedure inplace? You seemto be saying that 14 there is a harm. 15 MR. MATTINGLY: I feel like I have to reread 16 my paper. Maybe I said somethingwrong orwasn't loud 17 enough or something. 18 The problem is, Gene, under the law, if DOE 19 publishes a new revised testprocedure, that itthen 20 becomes effective a 180 days after, you know, you 21 publish it in the Federal Register, and thenthe 22 manufacturer has to retesthis product. He retests 23 product that previouslymet theutilityrebate 24 criterion or thatmet the federal standards. 25 Now he finds out, oops, I can't do it EXECUTIVE COURT REPORTERS, INC. (301) 565-006451 1 anymore. This product that I had to spend all this 2 time tooling up for and producing for the last couple 3 years is now suddenly an obsoleteproduct. You know, 4 in some cases, it doesn't

-- it's one of those 20 5 percent of my models that was positionedjustto meet 6 the utilityrebate criterion, and in other cases, it's 7 a product that was positioned tojustmeet the federal 8 standards. It flunks out. 9 MR. MARGOLIS: If we would have, as we have 10 done in the past, have an alternate test procedure, 11 have two test procedures inplace, the one that we now 12 have or withwhatever modifications, and then procedure 13 Aprime, whichwould be to be usedwhen we then 14 --institute standards, which thenwould be based on that 15 Aprime test procedure but not to go into effect

-- 16 MR. ADAMS: And you are talking about the 17 annual efficiency type of issue? 18 MR. MARGOLIS: That's right. 19 MR. MATTINGLY: Well, I would say that if you 20 could

-- ifyouwant toprescribe an alternative test 21 procedurewhich somehow clearly is not effectiveuntil 22 a later date, you know, God bless you, Gene, ifyou can 23 do that, because, youknow, from themanufacturer's 24 standpoint, the manufacturer, of course, needs to have 25 advance notice. You don'tjust say, okay, new standard EXECUTIVE COURT REPORTERS, INC. (301) 565-006452 1 tomorrow, gee, I guess we'll startto redesign our 2 products. It's a many years process of redesigning a 3 product. So, themanufacturer needs lead time to know 4 what's the new standard andwhat's the testprocedure 5 it's based on. 6 So, we wantmaximum time on that. If you can 7 do itthatway, I don't see a problemwith that. 8 MR. ADAMS: Thankyou verymuch. 9 MR. MATTINGLY: Thankyou. 10 MR. ADAMS: SpeakerNumber 2, James Ranfone. 11 STATEMENT OF JAMES RANFONE, AGA 12 MR. RANFONE: Good morning. 13 I'mJimRanfone, Director of Codes and 14 Standards for theAmerican Gas Association. 15 I wanted to really overviewmy remarks. I'm 16 not goingto read them in detail. We will be 17 submitting some detailedremarks, also. 18 TheAmerican Gas Association orAGA is a 19 national trade association comprising approximately 275 20 natural gas distribution and transmission companies 21 throughout the united States, Canada andMexico. These 22 firms deliver gas energy from thewell head and various 23 unconventional sources to the burner tube, serving over 24 56 million customers. 25 The residential sectorrepresents a core EXECUTIVE COURT REPORTERS, INC. (301) 565-006453 1 market for the U.S. natural gas industry, accounting 2 for nearly 92 percent of the total customers in 1992. 3 Currently, residential gas use accounts for 24 percent 4 of the total U.S. gas consumption, the majority of 5 which is used for spaceheatingpurposes. 6 In 1992, approximately 2.3 million natural 7 gas central heatingunits, including furnaces and 8 boilers, were shipped throughout the United states, 9 and, accordingly, AGA has a sUbstantial interest in the 10 proposed modifications to themethod of testing the 11 performance of residential furnaces and boilers. 12 AGA is pleased to have the opportunity to 13 provide input to the Office of Energy and Efficiency 14 and Renewable Energy of DOE on the proposed 15 modifications to the test procedures used to measure 16 the performance of residential space heaters. 17 The natural gas industry is committed to 18 providing consumers with efficient, reliable and safe 19 service. The gas industry in conjunctionwith 20 appliance manufacturers havemade sUbstantial progress 21 in developinghigher efficiencyresidential gas 22 equipment in general and inparticular gas central 23 heatingunits. 24 AGA, however, is concerned that the 25 modifications to the current testprocedure couldhave EXECUTIVE COURT REPORTERS, INC. (301) 565-006454 1 potentially significant adverse impact on the natural 2 gas industry and the nation's energy resources, if not 3 implemented in a fair, that is fuel neutral, and 4 consistentmanner. 5 AGA has long supported a full cycle approach 6 to energy decisions and is encouraged that DOE appears 7 to be finally considering a full cycle analysis as 8 evidenced in theproposed rulemaking. 9 Clearly, attempts to improve energy 10 efficiencymust lookbeyondthe burner tube. High end11 use efficiencies aremeaningless if they must be 12 coupledwith low efficiencies in the production, 13 transportation, conversion or distribution of energy. 14 At the same time, AGA is discouraged since 15 the full cycle approach is applied only to the fossil 16 fuel equipment, ignoring electric equipment completely. 17 One of theproposedmodifications, for 18 example, would establish an additional new annual 19 efficiency descriptor thatwould include auxiliary 20 electrical energy consumption, that is for motors, 21 fans, etc., for fossil fuel furnaces. 22 Moreover, or furthermore, the auxiliary 23 electrical energy consumed by the fossil fuel furnaces 24 would take into account the source of energy or, in 25 otherwords, the energyused during the conversion EXECUTIVE COURT REPORTERS, INC. (301) 565-006455 1 process at the electric generating plant as well as the 2 energy used or lost during the transmission of the 3 electrical energy to the home. 4 The source energy concept in this case has 5 not been applied to electric equipment. We see no 6 logic in the application of a full cycle approach to 7 heating equipment whichhas a veryminor dependence on 8 electricitywhile forgoing this approach to equipment 9 which is a hundred percent dependent on electricity. 10 NOw, some specific comments on the energy 11 descriptor of annual efficiency orAE. Establishing a 12 new energy efficiency descriptor for furnaces and 13 boilers to include auxiliary electric consumption 14 expressed as a source of fuel equipment has merit if 15 it's applied properly. 16 The full benefits of establishing an AE will 17 only be realized if the descriptor is generalized to 18 all appliances used for the same purpose, that is 19 electric furnaces which are used to heat in the winter. 20 Only under these circumstances will the consumer be 21 afforded the true comparison of the total resource 22 efficiency and the actual energy conservationpotential 23 of the equipment decision. 24 The definition of the energy factor, EF, and 25 annual efficiency, AE, descriptors used by DOE for EXECUTIVE COURT REPORTERS, INC. (301) 565-006456 1 electric equipment needs to be revisited. Under the 2 proposed rule, electric furnaces and boilers would be 3 given the rating of an EF equal toAFUE and an AE equal 4 to anAFUE which, following theASHRAE 103 procedure, 5 wouldproducevalues close to a hundred, and I must 6 comment that Carlmade a comment thatwe may have 7 forgotten the UCF factor for electric furnaces, and 8 maybe that's true, and I won'thave to go through all 9 this, butwe'll continue onhere. 10 This contrastswiththemore rigorous 11 formulas used to calculate the EF andAE descriptors 12 for fossil fuel furnaces and boilers which are required 13 to be used in F factor of 3.37 to relate auxiliary 14 electric input backto the source fuel used during the 15 electricitygenerationprocess. 16 If the purpose of accounting for electrical 17 consumption in theproposed energy descriptor is to 18 promote the development of more efficient electrical 19 components, that ismotors andblowers, this would 20 necessarily apply to electric appliances as well. 21 DOE must apply the F factor to oil, gas and 22 electric appliances that are coveredbyNAECA to 23 maintain consistency and equitybetween the energy 24 sources. Ignoringthe source efficiency of an oil 25 furnace or boilerwhile includingthe source efficiency EXECUTIVE COURT REPORTERS, INC. (301) 565-006457 1 of the auxiliary electrical consumption of fossil fuel 2 furnaces and boilers is illogical and biased. 3 Furthermore, proceedingwith the proposed 4 approach couldhave the exact opposite effect of that 5 which is intended by the law. Consumers may opt to 6 purchase electric equipment which oftenhas a lower 7 purchase cost as opposed to comparable natural gas 8 equipment, assuming that the electric equipment will 9 cost less to operate. 10 The net effect of the decision would be an 11 increase in total energy consumption rather than a 12 decrease. 13 Now, on the impact on the current equipment 14 ratings, AGA believes that DOE needs to test a 15 sufficient number of furnaces and boilers using the 16 modified testprocedure beingproposed to ensure that 17 furnace and boilermodels that are currentlymeeting 18 the existingminimum efficiencyrequirements are not 19 adversely impacted to the pointwhere they no longer 20 complywith the law. 21 DOE's comments indicate that they believe the 22 proposed changes "will not change the related existing 23 energy conservation standards". However, no 24 documentation ispresentedthat indicates that an 25 analysis supporting this claimhas been performed. EXECUTIVE COURT REPORTERS, INC. (301) 565-006458 1 We urge DOE to undertake such an analysis 2 before the proposedmodifications are finalized. Not 3 doing so couldresult inrevised equipment ratings that 4 will impact the utilityrebate programs as well as 5 impacting equipmentmodels currently in compliance. 6 So, in conclusion, we firmly believe that the 7 interest of the nation and its residential energy 8 consumers are best servedby testing and standards 9 whichreflect as completely as possible all the energy 10 requirements from the point of energyproduction to the 11 point of enduse. 12 However, to applythis concept on a limited 13 basis, ignoringthe class of equipmentwhich is most 14 relevant, that is electric, with the arbitrary, unfair 15 and counterproductive from an efficiency, energy 16 efficiency standpoint, andwe will be supplementing 17 these comments with some additional written comments, 18 and I would be gladto try to answer any questions for 19 you at this time. 20 MR. ADAMS: Thankyou. 21 I have no questions of you at this time. 22 Cyrus? 23 MR. NASSERI: I don'thave any questions, but 24 I think this concern of themarginal units and testing 25 andwhatwe claimmodification does not do any changes EXECUTIVE COURT REPORTERS, INC. (301) 565-006459 1 to the standards, I think, is a good thing that we had 2 some concern, and we are waiting to see if they can 3 submit some data, if it's necessary, obviously after 4 some testing. 5 MR. RANFONE: Okay. Well, I assume, though, 6 under the law, section 323(e)(2), that you would have 7 had to do this anyhow or you're not required to do 8 that? 9 MR. NASSERI: Well, we claim in our notice 10 that there's no change, but now you're saying that 11 you're not submitting any document to support our 12 claim, right? 13 MR. RANFONE: Well, I relate back to the 14 water heater changes in the test procedure, where you 15 did make some -- you did some testing to evaluate, and 16 you did make an adjustment, at least to electric water 17 heater efficiency, not to gas. 18 Butunder some circumstances, you inthe past 19 have conducted some tests to see the impact of the test 20 procedure, but in this particular case, it appears that 21 you haven't, and I think some of the comments and 22 questions raised by GAMA on the impact have to be 23 addressed. 24 MR. NASSERI: That was our feeling. Would 25 there be any changes? It looks now there is some EXECUTIVE COURT REPORTERS, INC. (301) 565-006460 1 concern in terms of that. 2 MR. RANFONE: Butwe really are concerned 3 about the F factor for electric furnaces, the way that 4 has been not addressedreally for electric furnaces. 5 Questions? 6 MR. ADAMS: George? 7 DR. KELLY: Just on the F factor. You know, 8 the new energy descriptorwas notmeant to make 9 everything equal across different categories of fuel10 consuming appliances, electricversus heat pumps or gas 11 versus oil. Itwas to solve a problemwithin the one 12 category of gas-firedjoil-fired equipmentwhere you 13 couldhave blower run times thatwere different, this 14 problem of how longyou let the blower run or you could 15 havepower ventedunits versus natural draft units and 16 how much energy they consume or lIDs and stuff like 17 that. 18 Are you saying that it'snot worthwhile to 19 try and iron out those differences, to distinguish 20 between those differentproducts, ifyou can'thave it 21 extended across all the different energy heat pumps and 22 electric furnaces -- 23 MR. RANFONE: I'mnot saying it's not logical 24 to not do that. I mean use thatmechanismto do what 25 youwant to do. EXECUTIVE COURT REPORTERS, INC. (301) 565-006461

1 DR. KELLY: Suppose you can't do it. Are you 2 sayingyou shouldn't do it then? You shouldn't try and 3 at least bringwater within the one category of fossil 4 fuel-fired equipment? 5 MR. RANFONE: Well, I guess my question would 6 be then 7 DR. KELLY: And if so, how would you suggest 8 doing otherwise? 9 MR. RANFONE: I'mmissingyour question 10 because I guess all I'm -- all we're saying is that to 11 count for electrical consumption, apparently the way 12 the Federal Register reads, one of the reasons you're 13 doing it is to use itto evaluateupcoming standards. 14 Fine, do that. Take itback to source, which you're 15 doing. 16 All we are suggesting is thatwhen you do 17 thatprocess, that it also be applied to otherproducts 18 coveredby the -- 19 DR. KELLY: I hear you, but I'm saying, being 20 realistic, if, for political reasons, I mean youhave 21 heatpumps and youhaveARI inhere testifying the 22 opposite, if that couldnot be done, are you saying 23 it's not worth doing? 24 MR. RANFONE: Well, I'mnot saying -- you're 25 saying it's for political reasons itcan't be done. EXECUTIVE COURT REPORTERS, INC. (301) 565-006462 1 I'm saying for

-- 2 DR. KELLY: I'm saying if, for political 3 reasons, it could not be done, are you saying

-- 4 MR. RANFONE: I'm nothere to talkpolitics. 5 I'mhere to talk about the technical merits of the test 6 procedure. 7 8 9 DR. KELLY: Okay. MR. RANFONE: The DR. KELLY: What wouldAGA recommend to be 10 able to solve, withinjustthe furnace blower category, 11 to distinguish betweenthe different electrical 12 consumptions by, say, the same furnace, where ithas 13 the high efficiencyblower on it orhow long the fan 14 motor runs? 15 I mean how would you suggest solving that? I 16 mean you got a suggestion? 17 MR. RANFONE: You have your solutionhere. 18 You recognize electrical consumption. Take itback to 19 the source. 20 DR. KELLY: Are you backing that solution? 21 MR. RANFONE: Yes. But apply it to other 22 equipment. Why wouldyou go ahead and say that the 23 electricitythat's being applied to a fossil fuel 24 appliance should be accounted for and then adjust it 25 for source or fossil fuel but, say, the electricity EXECUTIVE COURT REPORTERS, INC. (301) 565-006463 1 going to the furnace should not be? That's the 2 question. 3 DR. KELLY: Well, you know, I absolutely 4 agree, but I think it's going to be a littlepolitical 5 hard sell to take thatheat pump with a HSPF of three 6 down to .6 or something. I mean itwould be nice, but 7 itmight run into a little opposition. 8 MR. RANFONE: Well, I guess I'm not here to 9 discuss politicalmerits. I thinkwe're here to 10 conserve energy inthe country, and if in fact the 11 existing testprocedures for otherproducts are not 12 do not recognize source energy, then maybe it's a time 13 that -- through anyway we can, to recognize it, and I 14 think that's what this Administration is all about, and 15 that's what we ought to be aiming for. 16 Whether we're goingto run into a buzz saw, 17 which we've been doing it for 12 years, so I guess 18 another year is not going to bother us, George, orhow 19 long ittakes, butwe're going tojustkeep pounding at 20 this message because, you know, DOE openedup the 21 issue. You were the ones that come outwith the test 22 procedure that says recognize electrical consumption. 23 Secondly, take itbackto the source. Fine. 24 Do it. Do it consistently. We're talking about a 25 furnace testprocedure now. Ifyouwant to apply itto EXECUTIVE COURT REPORTERS, INC. (301) 565-006464 1 heat pumps, if you want to apply it to water heaters, 2 we'll take onwhen that time comes. 3 But in themeantime, it'sjust illogical to 4 do this, to do it the way it's beingpresented. 5 Perhaps in the labelling program in the future, there 6 can be adjustments. Maybe we are going to use a 7 different energy descriptor for labelling purposes, for 8 example. I don't know that, but in the meantime, since 9 you have this as an optional way of measuring 10 efficiency for equipment, you have two different 11 options in there. Make it correct, and that's all that 12 we're asking for. 13 MR. ADAMS: James? 14 MR. MILLS: I have no questions. 15 MR. ADAMS: Gene? 16 MR. MARGOLIS: I have no questions. 17 MR. ADAMS: Thank you very much. 18 MR. RANFONE: okay. I appreciate the 19 opportunity. 20 MR. ADAMS: Speaker Number 3, David 21 Goldstein. 22 STATEMENT OF DAVID GOLDSTEIN 23 NATURAL RESOURCES DEFENSE COUNCIL 24 25 MR. GOLDSTEIN: Good morning. Thank you verymuch, gentlemen of the panel. EXECUTIVE COURT REPORTERS, INC. (301) 565-006465 1 My name is David Goldstein. I'mthe Energy Program 2 Director for the Natural Resources Defense Council, 3 which is an environmental organizationwith over a 4 170,000 members and contributors nationwide. 5 NRDC has promoted energy efficiency inhome 6 appliances through state efficiency standards, federal 7 efficiency standards, building codes at both the state 8 and federal and voluntary level, and utility incentive 9 programs for some 20 years. 10 To summarize our comments, NRDC supports the 11 proposed changes for timely implementation. I'll focus 12 our comments on the Department's proposed modifications 13 to account for the electrical energy consumption of 14 products whose primary energy use is oil and natural 15 gas. 16 NRDC strongly supports the Department's goals 17 of providing energy descriptors that account for all of 18 the actual energyuse. The current absence of such 19 procedures in the AFUE descriptor provides perverse 20 incentives for manufacturers tomeet the standards by 21 in fact wasting energy. 22 There is already anecdotal evidence that a 23 manufacturer whoseAFUE falls very slightlybelowthe 24 legal minimum of 78 will use extra-low efficiency fans 25 andmotors, essentiallyresistanceheaters, in order to EXECUTIVE COURT REPORTERS, INC. (301) 565-006466 1 make theAFUE ratingmeet the standardbut actually 2 waste energy. 3 DR. KELLY: Could I ask you how they do that? 4 MR. GOLDSTEIN: Sure. If you have a if 5 you would normallyuse an 80 percentmotor but you 6 choose a 40 percent efficientmotor, then you're 7 providingmore heat into the supply air stream to the 8 house that counts as useful heat, but the electric 9 energy consumptionto supplythat is not counted in the 10 testprocedure. 11 DR. KELLY: You realize the furnace boiler 12 testprocedure is a heat loss test procedure, it's not 13 an input/output testprocedure? So, none of the heat 14 from the blowermotor is measured as far as the 15 procedure. 16 MR. GOLDSTEIN: I haven't looked at the 17 technical details of it, but I'veheard that that 18 loophole has beenused by somemanufacturers. My 19 understanding 20 DR. KELLY: I would likeyou to explain that 21 maybe, how, because it's not obvious tome how that can 22 be done. 23 MR. GOLDSTEIN: I can'tdo that at this 24 hearing. I could lookback at the technical aspects 25 and seehow thatworks, but ithadbeen explained tome EXECUTIVE COURT REPORTERS, INC. (301) 565-006467 1 that that input and -- the useful heat outputwould be 2 measured in the fashion consistent with what I just 3 said. 4 Okay. Regardless of whether this kind of 5 loophole is actually beingused, the fact that it's 6 allowed and the fact that consumers can't seewhether 7 it's being used is a credibilityproblemthat I think 8 needs to be addressed. 9 This is a serious issue inprinciple because 10 whenever the effect of a design option on rated 11 efficiency is running in an opposite direction to its 12 effect on true consumer costs or true energy 13 efficiency, manufacturers are going to be encouraged to 14 do the wrong thing. 15 We allknow that the market for equipment for 16 home heating is very competitive. It's competitive on 17 the basis of first cost. You'dbe asking a lot of a 18 manufacturer to voluntarilyrefrain from using a 19 loophole if it's goingto savehimmoney at the expense 20 of energy efficiencywhen the loss in energy efficiency 21 will never be known tothe consumer because allhe sees 22 is the AFUE rating, and he's not going to know the 23 technical details ofwhat went into it. 24 The solutionto this problem is what the 25 Department has suggested to bring the performances EXECUTIVE COURT REPORTERS, INC. (301) 565-006468 1 rated by the descriptor into alignment with the actual 2 energy performance that the consumer sees. We believe 3 DOE's new proposals for energy factor and annual energy 4 descriptors will accomplish this goal. 5 The proposal that DOE specificallymakes is 6 to use a source energy approach. The energy needed to 7 generate the electricity is theway that you count 8 electric input to the furnace. NRDC strongly endorses 9 this approach, butwe do so while noting it is not the 10 onlypossibleway thatyou can take into account the 11 higher thermo-dynamic value of the electricitythat's 12 beingused. 13 You coulduse BTUs as DOE has proposed. You 14 could use consumer costs, which I think is what GAMA 15 was suggesting earlier. You could use airpollution 16 impacts or you coulduse climatepollution impacts. 17 It's important to note that you will get a 18 higher F factor using any of the other alternatives 19 thanyou get using source energy. So, that's themost 20 conservative approach. 21 I saidwe supportedthat approach. We would 22 also be supportive of an approachbased on, for 23 example, average consumer costs inthe year where the 24 revisionwas made. This is a much more accurate, much 25 more useful approach than a possibility of what some EXECUTIVE COURT REPORTERS, INC. (301) 565-006469 1 would characterize as one for one accounting of 2 electrical energy or an F factor of one, because using 3 an F factor of one would say that a manufacturer wants 4 to meet anAFUE target is indifferent to the choice of 5 using one kilowatthour or 3,413 BTUs. 6 In fact, the one kilowatthour costs a lot 7 more, costs about eight cents, while the 3,413 BTUs 8 typically cost about two cents. So, we want a trade9 off that is more reflective of what the consumer is 10 seeing. DOE's F factor is one way of doing that. 11 As I mentioned, a cost-based or an emissions12 basedmethod would give you a different and higher F 13 factor, and those would also be reasonable ways to 14 approach the issue, particularly in the context I 15 mentioned particularly in the context of the 16 President's ClimateAction Plan. Agreenhouse 17 emissions-based F factor would also bejustifiable. 18 NOw, we recognize by adopting these proposed 19 changes, it's not going to affect the compliance of 20 units with NAECA because of theprocedures written into 21 NAECA that say that any unit thatmeets the standards 22 under the original testprocedure can continue to be 23 sold. 24 However, we believe that it shouldbe adopted 25 in a timely fashion. These changes should be adopted EXECUTIVE COURT REPORTERS, INC. (301) 565-006470 1 in a timely fashion by the Department because it 2 provides more realistic data to the consumers, more 3 realistic data that beusedbyutilities in designing 4 their incentiveprograms and gettingwhat they're 5 reallypaying for, and alsomore realistic numbers that 6 can be used in state or local building codes. 7 This isparticularly important in the context 8 of EPAC because DOE is supposed to be workingwith 9 states to try to adopt themodel energy code or an 10 equivalent code within the next two years. 11 If you look at eithertheMEC or you look at 12 ASHRAE 90.2, both of them contain trade-off procedures 13 that would allowtrading off higher furnace efficiency, 14 for example, for lower insulation levels. We want 15 those trade-offs to be as accurate as possible. We 16 also want them to be as simple as possible, and DOE's 17 proposal accomplishes this. 18 I noted earlierthat the GAMA representative 19 suggested that there shouldbe a separate descriptor 20 for electric energyuse comparedto gas energyuse. We 21 think that's a good idea. However, I don't think it 22 obviates the need for a single simple descriptor that 23 puts everything into one number. 24 Buildingcode compliance inmost cases is 25 going to be donewith one number. We shouldhave that EXECUTIVE COURT REPORTERS, INC. (301) 565-006471 1 as an official DOE certified test rating that can be 2 used in these calculations, even ifmore sophisticated 3 users may want to take the electricuse and the gas use 4 separately. 5 In otherwords, doing one approach does not 6 preclude doing the other approach. We would actually 7 support you doing both; that is, having the annual 8 energy descriptor as you've proposed and having a 9 separate descriptor for electricity and energyuse and 10 gas separately for those who wanted to performthe 11 calculations inmore detail. 12 These arguments thatwe're describing apply 13 to all of the classes of products which DOE is seeking 14 comment. 15 The Department is also proposing a new 16 efficiency descriptor to apply to furnaces to be 17 installed indoors and changes to the methods for 18 computing the draft factor for off-cycle losses, 19 particularly for furnaces within the air dampers and 20 draft diverters. 21 NRDC supports these proposals because they 22 provide better self-consistency andmore accuracy than 23 the current test procedures. Inparticular, the issue 24 of what happens when a unit has a draft diverter and 25 it's installed in conditioned space is handled in a EXECUTIVE COURT REPORTERS, INC. (301) 565-006472 1 self-consistentway by the new DOE proposals. So, we 2 think they'll provide substantial increases in the 3 accuracy compared to the current testmethods. 4 So, in summary, we support the changes in the 5 August 23rd Notice, and that concludes our statement. 6 We'll be happy to respond to questions. 7 MR. ADAMS: Thank you. 8 I have no further questions. 9 cyrus? 10 MR. NASSERI: If I understand, NRDC is 11 proposing that we even consider F factor than what we 12 have in the proposed rule? 13 MR. GOLDSTEIN: We would be comfortable with 14 an F factor that was based on, for example, consumer 15 costs in 1993 orwhatever themost recent data is or 16 one based on air emissions. 17 We would also be comfortable with the F 18 factor as you've proposed it. So, we're not saying you 19 must change it, but if you feel that would be a better 20 solution in terms ofpolicy and in terms of what would 21 go down betterwith GAMA, we would be comfortablewith 22 that. 23 The one cautionwe would have if you use 24 costs, costs established by

-- in the labellingprogram 25 change from year to year, and itwould not work to have EXECUTIVE COURT REPORTERS, INC. (301) 565-006473 1 ratings that changed every time the ratio of gas to 2 electric costs changed. 3 So, you have to pick one year, fix it, and 4 say for the next 10 years or the next longperiod of 5 time, until the ratio gets seriously out of kilter, 6 we'll use the ratio from oneyear. 7 MR. ADAMS: George? James? Gene? 8 MR. MARGOLIS: David, I wouldjust like to 9 re-emphasize whatMr. Kelly said about the DOE test 10 procedure, andwould you, as you saidyou would do in 11 your prepared comments, would you comment on what he 12 said because of your written testimony, a lot of it 13 goes into this loophole, whichmay -- whichMr. Kelly 14 says does not exist, and you seemto say does exist. 15 So, itwould be important for us to see if 16 you have any information to backupwhat you are 17 saying. 18 MR. GOLDSTEIN: Sure, Gene. I'll be happy to 19 look into that and trytoprovide some more 20 information. 21 I guess I should also respond and say that 22 this change isjustifiedandwouldmake sense, even if 23 thereweren't a loophole, because it ismore accurately 24 reflective of energyuse tothe consumer, energyuse to 25 the nation and costs to the consumer. EXECUTIVE COURT REPORTERS, INC. (301) 565-006474 1 So, even if that loophole didn't really 2 exist, itwould still be a more accurate rating to 3 include the F factor, include the energy inputs as DOE 4 is proposing. 5 6 7 8 Starke. MR. MARGOLIS: Thank you. MR. GOLDSTEIN: Thank you. MR. ADAMS: I call Speaker Number 4, Channing

9 STATEMENT OF CHANNING STARKE 10 HYDRONICS INSTITUTE 11 MR. STARKE: I'm Chan Starke. I'mTechnical 12 Director of the Hydronics Institute. 13 Hydronics Institute is a non-profit trade 14 associationwhich represents the majority of domestic 15 manufacturers of residential gas and oil-fired boilers. 16 We appreciate this opportunity to provide 17 input to the Department of Energy at this early stage 18 of its consideration of possible changes in the test 19 procedures affecting our members' products. 20 Our concerns center on regard to test 21 procedure, center on the main areas of the use of 103- 22 88. As of this meeting, this is not the current 23 standard. Our understanding is thatASHRAE, once it 24 brings out a new standard, ceases publication of the 25 priorversions. EXECUTIVE COURT REPORTERS, INC. (301) 565-006475 1 So, unless you reference 103-93, which is the 2 current standard, manufacturers are going to have 3 difficulty obtaining additional copies of the earlier 4 standard. 5 The second area of concern is the calculation 6 of auxiliary electrical energy as part of the useful 7 energy delivered to the building. If it's applied to 8 gas or oil-fired equipment, it also needs to be 9 uniformly applied to all heating equipment, including 10 electric boilers, furnaces and heat pumps. To apply 11 the 3.37 factor for electrical consumption to only 12 group of products, furnaces and boilers, penalizes that 13 product and affects competitionwhere it occurs, and, 14 further, itwould cause a shift from direct combustion 15 to indirect or electrical supply, and it's contrary to 16 the DOE's goal of saving energy. 17 That's our feelings on it. In other words, 18 we do support applying that if you apply the factor 19 across the board. 20 Any questions, I'll be glad to answer. We 21 will be submitting these comments in written form with 22 additional data to support it. 23 24 25 MR. ADAMS: Thank you. I have no questions. Cyrus? EXECUTIVE COURT REPORTERS, INC. (301) 565-006476 1 MR. NASSERI: Just clarifyingtheASHRAE 103, 2 as everybody knows, theprocess of this proposed 3 rulemaking for revisionto testprocedure for furnaces, 4 boilers, otherproducts, tookplace a long time, and 5 during thatperiod, obviously in '88, ASHRAE 103-88 was 6 the only official document thatwe could reference. 7 During this period, ASHRAE 103 also, which 8 George andmyself are themembers, basicallytook the 9 same revisions thatwe have in our presentproposed 10 test procedure, and I think itwas one time thatwe 11 don't even change the format, and the copy on the 12 revision to the 93. 13 Obviously, in '93 came and become official 14 document a month ago, two months ago, whatever the time 15 was, I don't rememberwhen, but it is official 16 document, and this is one of the things we're going to 17 consider. 18 But there is one thing that ifyouwant to do 19 that, obviouslyyouhave to reduce the volume of test 20 procedures, the way it is right now, tomaybe tohalf, 21 and we have to seehow that affects some of the 22 internal GC and otherpeoplewho looked at the previous 23 one, and now they find out it'sjusthalf of what it 24 was before, and see if theyhave any questions on that 25 issue. EXECUTIVE COURT REPORTERS, INC. (301) 565-006477 1 So, we do recognize that, and it's a very, 2 very good comment that you brought up. 3 MR. STARKE: Okay. 4 MR. ADAMS: George? James? Gene? 5 MR. MARGOLIS: No questions. 6 MR. STARKE: Thank you. 7 MR. ADAMS: Thankyou verymuch. 8 Next, SpeakerNumber 5, David Lewis.

9 STATEMENT OF DAVID LEWIS 10 LENNOX INDUSTRIES, INC. 11 MR. LEWIS: My name is David Lewis. I work 12 for Lennox Industries. My position there is Vice 13 President of Industry and Regulatory Affairs, and this 14 morning, I'llbe delivering our company's statement. 15 Lennox International is a privately-held 16 corporationwith consistent ownership dating back to 17 1896. Lennox Industries, Inc., is a wholly-owned 18 subsidiary of Lennox International. Lennox is focused 19 onmanufacturinghigh-quality efficientheating and air 20 conditioning equipment for consumers and comfort 21 products worldwide. 22 Lennox is an active supporter of GAMA and an 23 activemember. GAMA has alsoprovided testimony at 24 this publichearing. It is our intention to support, 25 reinforce, underscore some keypoints that GAMA has EXECUTIVE COURT REPORTERS, INC. (301) 565-006478 1 made. It is our belief that our comments are 2 consistentwith what GAMA is stating. 3 Most of the proposed revisions contained in 4 the NOPR in Lennox's opinion is reasonable and 5 technically valid. Some of the proposed revisions will 6 affect the efficiency levels of our product. Lennox 7 does not believe that the proposed revisions benefit 8 one manufacturer's equipment more than another's. An 9 advantage does not exist for any manufacturer to 10 support or oppose the proposed testprocedure changes. 11 DOE's currentmethod of reinforcing ASHRAE -- 12 of referencingASHRAE Standard 103 and then listing a 13 number of exceptions is difficult to use and can lead 14 to errors if some of the exceptions are missed. Amuch 15 more user friendly approach would be to publish the 16 complete test procedure. 17 The ASHRAE Standard 103 referenced in the 18 NOPR was published and producedby the ASHRAE committee 19 which was fully represented by distinguished engineers 20 from the manufacturihg community. The ASHRAE 103 21 committeehas reached consensus and did approve the 22 test procedure revisions thatwill soon be published as 23 ASHRAE 103-1993. 24 In our opinion, itwould be much preferable 25 for DOE to beginuse of the current test procedure 1993 EXECUTIVE COURT REPORTERS, INC. (301) 565-006479 1 instead of using the older 1988 edition; making 2 additions and changes to the older revision onlymakes 3 itmoreprone for mis-interpretation. 4 TheASHRAE systemof consensus standards 5 surelyhas its shortages, but it is a good process for 6 establishing a complete and solidbase for industry and 7 government and testing agencies towork from. The 8 ASHRAE 103-1993 test standarddidhave one unresolved 9 commenter. However, this is not a good reason to slow 10 its usage. The standard committee did complete their 11 work and produce a solidbasis for future testing of 12 residential furnaces. 13 To not use the standard due to one unresolved 14 commenterwould be a tragedy to the entireASHRAE 15 system, it's our belief. 16 Itwouldbe an incorrect assumption to 17 believe, as intimated in theNOPR, that this proposed 18 change in the testprocedurewill not represent a 19 significant change to the ratings of furnaces. Many 20 products thatmeetthe standardtodaymay notmeet the 21 standardunder the new requirements. 22 For DOE to suggest that a 180 days is 23 sufficient for manufacturers to adjust to this new 24 standard is quiteunrealistic. Manufacturers do need 25 sufficienttime tomake adjustments and design changes EXECUTIVE COURT REPORTERS, INC. (301) 565-006480 1 where necessary. This can be accomplished by the 2 manufacturing community if adequate time is provided. 3 MR. MARGOLIS: Do you have any idea what an 4 adequate time would be? 5 MR. LEWIS: I can only speak for Lennox, not 6 for GAMA or the rest of industry. We personally feel 7 that three years is a very fair look at this, and that 8 three years is basedupon a need for new furnace 9 families to be developed, utilizing the tests as shown 10 in the new ASHRAE standard. 11 DR. KELLY: Couldyou provide data on which 12 of your units would not meet theminimum efficiency 13 standards because of the changes in the test 14 procedures, and which changes cause them to not meet 15 it? 16 MR. LEWIS: Mr. Kelly, the new test standard 17 would affect all of our products as far as we're aware. 18 So, to beginwith, I don't thinkwe have gone through 19 the complete testing of each and every unit that we 20 manufacture today as far as its effect on the test 21 procedure. 22 But the changes inthe te'st procedure are 23 quite significant, and, therefore, -- 24 25 DR. KELLY: Which ones are those? MR. LEWIS: Excuseme? EXECUTIVE COURT REPORTERS, INC. (301) 565-006481 1 DR. KELLY: Which ones are you referring to? 2 MR. LEWIS: I am statingthat our furnace 3 products today

-- 4 DR. KELLY: Which changes in the test 5 procedure are quite significantthatyou're referring 6 to? 7 MR. LEWIS: I would be happy to submit that 8 in written form to you. 9 DR. KELLY: That would be nice. Also, if 10 you couldprovide some data on what the effectwas for 11 your furnace line. 12 MR. LEWIS: I don't believe I don't want 13 to mislead you. I don't believe that we would be able 14 to provide information on each and every furnace and 15 how it's affected, butwe certainly could summarize 16 some comments and show specificallywhere theywould be 17 affected to demonstrate the comment thatwe justmade. 18 DR. KELLY: Itwouldn'thave to be on each 19 and every furnace; itcould be some typical furnaces. 20 MR. LEWIS: I guess the comment that I just 21 got throughmakingwas that every furnace that we 22 manufacture, withvery, very few exceptions, would have 23 an efficiency standard change basedupon the newASHRAE 24 103 orwhat you're alludingto in the NOPR. 25 DR. KELLY: Butyou can't tell me why? EXECUTIVE COURT REPORTERS, INC. (301) 565-006482

1 MR. LEWIS: Because it's a change in test 2 procedure. If youhave a measuring stickthat's 12 3 inches, and all of a sudden, you come up with a 4 measuring stickthat's 13 inches, everything you've 5 measuredpreviously at 12 inches is affected. 6 MR. NASSERI: We are interested to receive 7 any tested data concerningtheproposed testprocedure 8 and the previous one, andhow that affects your 9 product, if youhave something likethat as part of 10 your comments, written comments. 11 MR. LEWIS: We would be happy to do that, and 12 also I would want tounderscore that we're 13 participating in the informationgathering that GAMA is 14 currently doing, and obviouslywe will contribute 15 through that process as we have already. 16 DR. KELLY: But, youknow, just saying that 17 the whole testprocedurereduces the efficiencybythis 18 much is not veryhelpful. Ifyou can say that these 19 changes have this effect or thesehave those 20 significant factors, thatwould behelpful. 21 MR. LEWIS: I'mnot sure ifyou wantme to 22 proceed on that discussion or -- I understand what 23 you're saying. 24 DR. KELLY: I'mjust sayingthat thatwould 25 be useful data. The other is not veryuseful. EXECUTIVE COURT REPORTERS, INC. (301) 565-006483 1 MR. LEWIS: Well, I guess what is useful and 2 the point that themanufacturerwould want made very 3 clearly 4 DR. KELLY: But you canhide an awful lot in 5 the statistics, too. 6 MR. LEWIS: Mr. Kelly, our desire is not to 7 hide anything. Thepoint that we're trying to bring 8 here today is that the NOPR as written, the changes 9 that would be or that would exist ingoing to that test 10 procedure change would affect everyproduct thatwe 11 manufacture today, andwe feel like that's significant, 12 and that's why we want to bring this information to 13 your body to consider. 14 Regarding the waiver process, a large number 15 of waivers were granted over a several-yearperiod for 16 furnaces with fixed-blower on times. Manufacturers 17 spend a great deal of time applying for these waivers 18 while a lot of DOE's time was also consumed with the 19 repetitive processing of these waivers. 20 Much of this effort could be avoided if DOE 21 would complywithwhat is noted there inmy statement 22 and also it's specificallywritten out as far as how it 23 appears in actual text. So, we believe that the waiver 24 procedure and going alongwith the one-year basis would 25 eliminate a lot of the repetitivework that has gone on EXECUTIVE COURT REPORTERS, INC. (301) 565-006484 1 so far in this process. 2 There are a couple of areas where we do 3 believe there needs to be some clarification. section 4 323 of the National Appliance Energy ConservationAct 5 of 1987 require amendments to the Energy Conservation 6 Standardwhen new testprocedures alter the measured 7 energy efficiencies of furnaces and boilers. with such 8 amendments, adequate time, and, in our opinion, not a 9 180 days or even an additional 180 days, must be 10 provided for equipmentmanufacturers governed by the 11 new rule for adjustment andredesign. 12 Then, secondly, clarification is needed in 13 section 323, Paragraph (e)(3), of the National 14 Appliance Energy ConservationAct of 1987 where further 15 explanation is needed as to the extentthat 16 grandfatheredproducts canbe revised ormodified and 17 stillremain grandfathered. 18 I guess a simple example of this would be as 19 a manufacturermoves from one component supplier, such 20 as a timed off switch, to another component supplier, 21 we in ourproduct actually change the dash number of 22 our equipment, and it'srather confusingto tryto 23 figure out exactlywhatthe grandfathering is 24 addressing, and that clarificationwould be very 25 helpful. EXECUTIVE COURT REPORTERS, INC. (301) 565-006485 1 Regarding the new descriptor, Lennox assumes 2 that DOE is beginningpreparations to have a new 3 descriptor developed to coincide with the next revision 4 of the national standard. 5 There is a lot of controversy surrounding 6 this suggestion. We feel that if DOE desires a new 7 descriptor to include electrical usage, then electrical 8 usage should also be shown in similar fashion for 9 electric furnaces andheatpumps. To penalize one 10 product and confuse the consumer by including the 11 source energy conversionmultiplier is really a step 12 backwards. 13 We maintain that what is done to one product 14 affecting the market should also be done to all 15 competing equipment that provides the same purpose of 16 conditioning space. Lennox supports the goal of 17 identifying the electrical usage of a furnace product. 18 The consumer must remain in the center of DOE's focus, 19 if descriptor changes aremade. 20 Any change to the energy descriptor should 21 help identify for the consumer the true effect that the 22 newproduct will have, mirrored in their utilitybill. 23 The consumer is not interested in theory. An 24 equipment's descriptor number should not bepenalized 25 to a utility's method of power generation. The EXECUTIVE COURT REPORTERS, INC. (301) 565-006486 1 consumer shouldbe offered a clear presentation of the 2 cost, and I guess we wouldmake one additional comment 3 here. 4 It's clear that within the GAMA directory, as 5 really was stated earlier, that the electrical usage is 6 identified, and that the consumer canmake the 7 through a cost of operations simple analysis, be able 8 to see what electrical usage is used by the product. 9 So, that information is available today. 10 Thank you. 11 MR. ADAMS: Thank you. 12 I have one question. It's an issue that's 13 gotten quite a bit of discussion today. You stated in 14 your overview, and then additionally, that some of the 15 proposed revisions will affect efficiency levels of our 16 product, and you stated that all of your -- essentially 17 all of your furnaces would be affected. 18 I guess what you didn't saywas whether those 19 are all reductions or some reductions and some 20 increases inAFUE, and couldyou in your written 21 comments provide any data that you might have on both 22 increases and decreases inAFUE for the modifications, 23 either separately or as packages, if you wanted to put 24 it in packages of category 1, category 2, as GAMA has 25 indicated, and sinceyou indicatedyou supported GAMA's EXECUTIVE COURT REPORTERS, INC. (301) 565-006487 1 position, thatwouldbe helpful for us to come to grips 2 with changes inthemagnitude of changes. 3 MR. LEWIS: We have already, and we'll 4 definitelywork, continue towork with GAMa to give you 5 the best information for your decisions to bemade 6 from. I certainlyunderstand the question andwill 7 work to try to provide that information. 8 MR. ADAMS: Thankyou. 9 Cyrus? 10 MR. NASSERI: I have one general comment on 11 your comment aboutwaiverprocess, and the specifics on 12 this time delay on the blower, the fixed time. 13 Obviouslywe have to obey the legislation 14 that says one year after anywaiver is given, it should 15 revise the testprocedure and include, but the 16 interestingpoint is that since 1985, when these 17 waivers came intothepicture, that's beforemy time 18 obviously, we had a variety ofrequests from 19 manufacturers from 0 time delayup to 70 seconds time 20 delay, and your companyprobably came up with 40 21 seconds, 45 seconds, whatever, and itwas difficult 22 really for us to find outwhat is a good fixed time 23 that shouldbe, andthenwe selected 20 seconds, and 24 GAMA is basicallycommenting onthat issue. 25 And basicallythatwas one of the reasons EXECUTIVE COURT REPORTERS, INC. (301) 565-006488 1 thatwe were not able to really change the test 2 procedure as you requestedus tomake the time saving 3 for your effort or anymanufacturers to do that. 4 MR. LEWIS: Our statement generallywas not a 5 chastisement. Our statementwas based onwe have 6 startedthe new process here, and this hearing is in 7 itself a new process. One that started some time ago, 8 butwe're at a new juncturehere, and we feel like now 9 as we have learned from whathas transpired as we look 10 forward, we feel like the waiver process, while we 11 understand the necessity of it, surely could be 12 streamlined inmany ways, andwe are aware of the 13 difficulty that that represents to DOE. 14 MR. NASSERI: One of our concerns was that 15 the way the testprocedure is, itkind of dictates a 16 waiver request from manufacturers, the way our test 17 procedure ispresently, and that's one of the comments 18 thatwe requested everybodymake with input/output, and 19 obviously if that is -- was basically something thatwe 20 could change to another method of disposition, would 21 result in some of thesewaiver requests, but I don't 22 know if you staywith the same testprocedure, what 23 would be the result of future requests for 24 manufacturers for otherwaivers tomake theminimum 25 standards, basically, to improve theirperformance of EXECUTIVE COURT REPORTERS, INC. (301) 565-006489 1 their -- 2 MR. LEWIS: We feel like 103-1993 really 3 deals wIth givingus a goodpoint from which to move 4 from, and probablywould eliminate a lot of those. 5 MR. ADAMS: George?

6 DR. KELLY: I would just like to reiterate, 7 it doesn't do much good for us, at least for NIST, to 8 evaluate these comments ifyoujust say that allmy 9 units are affectedby the testprocedure or even 10 category 1 or category 2 affects them by somuch. 11 Itwould reallybe helpful for my next -- for 12 GAMA is to saywhere the effects are. It's the blower 13 time. It's the insulationproblem. It's the delay in 14 stack damper. It's thepost-purge. Where are your 15 problems with your units? Where do you see the 16 decrease or increase inAFUE? That would be useful. 17 MR. ADAMS: James? 18 MR. MILLS: I have no questions. 19 MR. ADAMS: Gene? 20 MR. MARGOLIS: You, inyour prepared 21 testimony and your oral comments, you talked about 22 grandfathering, andyou asked for the Department to 23 give further clarification as towhat does 24 grandfatheringmean. 25 I don't think that thatwould be best for the EXECUTIVE COURT REPORTERS, INC. (301) 565-006490 1 Department to do in any generalities. I think that it 2 would have to be on a case-by-case basis. The example 3 .you gave was changing, what was it, a compressor or -- 4 MR. LEWIS: Relay. 5 MR. MARGOLIS: Itwould seem in that 6 situation, whatevermanufacturer you would get or would 7 not be -- it stillwould be grandfathered, but it could 8 be that the itemthat you getwould be really a 9 different item, even though ithas the same name, it's 10 a relay, but it serves a differentpurpose, and, 11 therefore, byputting that into themachine, would not 12 be -- might not be grandfathered. 13 If you have any comments, written comments, 14 that you would like to give with some examples, and 15 thenpossibly from that make some general statements 16 about grandfathering, itwould be appreciated, but I 17 don't think thatwe could at this time make any general 18 statements aboutwhat product, you know, what would 19 grandfathering consist of, other than on, as I said 20 before, on a case-by-casebasis. 21 So, ifyou would like toput something into 22 the record, itwould be greatly appreciated. 23 MR. LEWIS: I guess we would hope that the 24 whole issue is not needed. We feel likewith an 25 adequate period of time, providedto the manufacturing EXECUTIVE COURT REPORTERS, INC. (301) 565-006491 1 community, to make the necessary design changes to our 2 product, the grandfathering issue then becomes really 3 quite moot. 4 MR. MARGOLIS: But you're saying a 180 days 5 or even the additional 180 days is not enough. If you 6 could showus how we could extend that time, other than 7 going back to Congress, which, since you were the ones 8 who were instrumental in getting thatpassed, maybe you 9 would have better luck in going to Congress and getting 10 it extended, I don't know see how we could go beyond 11 360 days. 12 MR. LEWIS: Other than, I guess as mentioned 13 earlier from GAMA, itwould depend on when you chose to 14 issue your final rule. 15 MR. MARGOLIS: All right. Okay. But if you 16 know of any otherway. Thank you. I have no further 17 questions. 18 MR. ADAMS: Thank you. 19 I call the next speaker, Speaker Number 6, 20 David Fink. 21 STATEMENT OF DAVID FINK 22 RAJENDRA K. NARANG 23 24 25 MR. FINK: Good morning, gentlemen. My name is David Fink. I'm an attorney. I'mhonored tohave this opportunity on EXECUTIVE COURT REPORTERS, INC. (301) 565-006492 1 behalf ofMr. Rajendra K. Narang to address the 2 Department of Energy on Test Procedures for 3 Furnaces/Boilers, VentedHome Heating Equipment and 4 Pool Heaters. 5 I mention thatMr. Narang is one of those 6 distinguishedmyriad independent inventors thatyou 7 ought to hear about. 8 The Department of Energy is providing 9 critical leadership to industries to improve the 10 equipment tomeet the national challenge

# 0; energy 11 conservation. It ismy fervent hope that the various 12 industries involved accept thenecessity of improving 13 equipment, tomake equipmentmore efficient andmore 14 effective, thereby benefitingconsumers and the country 15 as a whole. 16 This countryhas already experienced virtual 17 loss of industrial leadership inmany products due to 18 resistanceby our national companies to improve 19 products and to bemore conscious of consumer 20 requirements. 21 Asearch for common products and**~lectronics,** 22 cameras, carbon fibers, steel andmany other areas, 23 lead us to foreignmanufacturedproducts due to foreign 24 leadership in establishinghigh levels of performance 25 and quality.EXECUTIVE COURT REPORTERS, INC. (301) 565-006493 1 Most cases, itwas foreign governments which 2 establishedthe leadership for the companies toproduce 3 quality goods. Thus, there is ample basis for 4 governments tourge its industries to supply consumers 5 withproducts withhigh quality, to satisfythe 6 consumers and to obtain commercial success. 7 Similarly, it is appropriate that the u.S. 8 consumers rely on its own government agencies, such as 9 the Department of Energy, to establishtestprocedures 10 whichwill encourage genuine improvements inproducts 11 to benefit consumers. 12 Over the years, the Department of Energyhas 13 providedwaivers tomany manufacturers to avoid 14 creating economichardships for these companies. This 15 is reasonable and certainlywithin the discretion of 16 the Department of Energy. 17 The time, however, has come tomove forward 18 and gentlybut firmly urge industries to accept 19 advancements and reasonable performance criteria for 20 energy-intensiveproducts. Anyone cognizant of the 21 difficulty of encouragingthematuring of a childknows 22 that tests andperformancerequirements are essential 23 for change and improvement. Otherwise, the child 24 stagnates andremains immature. 25 TheU.S. furnaces andboilers industries as EXECUTIVE COURT REPORTERS, INC. (301) 565-006494 1 examples are readytomature through the establishment 2 of higher performance criteria. It is astonishing that 3 over the lastdecade, over 1,000U.S. patents relating 4 to furnaces andboilershave issued, and few of them 5 have beenutilizedby companies andproducts. 6 One possible explanation for this phenomena 7 is that there has not been sufficientmotivation of 8 companies to incorporate changes to improve the 9 products. Thus, thetechnology for advancement is 10 readily available. However, there is a reluctance by 11 manufacturers to incorporate changes and improvements 12 if the consumer isunaware of thepotential 13 improvements and the Department of Energy does not 14 require improved energy conservation. 15 Industry shouldnotwait for a consumer 16 advocate or a foreign power tomotivate change. It is 17 better if the Department of Energyprovides the 18 leadership and thatwe take advantage of available 19 technology. 20 Mr. Narang, from the time he first came to 21 the U.S., has been inventing improvements and 22 advancements toproducts in our country, andhas 23 publishedmost of these becausehe has been granted 24 patents numerous times bythe U.S. Patent and Trademark 25 Office. Many of thesepatentsprovided important EXECUTIVE COURT REPORTERS, INC. (301) 565-006495 1 practical technology leading to significant 2 improvements in energyconservation for improvements 3 well suited for incorporation intopresently4 manufacturedproducts. 5 Only a few ofMr. Narang's patents will be 6 mentionedhere. Additional informationwith specific 7 examples and copies of some of the importantpatents 8 will formpart of thewritten comments to be submitted 9 separately. 10 Example, Mr. Naranghas three patents 11 entitledFuel Burning Furnace, U.S. PatentNumbers 12 4,922,890, 4,987,881 and 5,086,754. These patents 13 provide increasedheat exchange area, intermittent 14 ignition device and vent damper, two-stage modulating 15 burner, improved blowermotor efficiency, power burner 16 and induce draft, increased insulation, condensation of 17 flue gases, andpost-combustion. 18 Inmany areas inthe U.S., furnaces operate 19 about four to five months a year, yetrepresent a 20 substantial energy consumingdevice as compared to 21 other devices. Thus, there are urgent needs to improve 22 furnaces, tominimize the energy loss and improve 23 efficiency. 24 The aforementionedpatentsprovideunique and 25 practical embodiments for dramatically improved EXECUTIVE COURT REPORTERS, INC. (301) 565-006496 1 furnaces. 2 Mr. Narang alsohas three patents entitled 3 oil and Gas Water.Heater. Thesepatents are 4,549,525, 4 4,664,096, and 4,869,232. Thesepatents providejacket 5 insulation, heat traps, reduced heat leaks from 6 fittings, reducedpilot light inputrate, automatic 7 ignitionwith a flue damper, elimination of central 8 flue and indirectheating of water, increased flue 9 bafflingwith forced draft, multiple flues, submerged 10 combustion chamber, use of post-combustion, 11 condensation of flue gases. 12 Waterheaters constitute a billion dollar 13 market and are essential for every home in the country 14 as well as every commercial facility throughout the 15 year. The impact of energy conservation ofwater 16 heaters and furnaces alongwith boilers couldbe 17 astonishing. 18 In summary, it is earnestlyhoped that the 19 Department of Energyrevises the testprocedures to 20 establishmore stringentrequirements to improve the 21 products to benefit consumers by conserving energy, 22 therebybenefitingthe nation. 23 Ultimately, industrywill reluctantly accept 24 the higher standards and in timewill use the improved 25 product performance to convince consumers to trade up EXECUTIVE COURT REPORTERS, INC. (301) 565-006497 1 so that themanufacturers will be well compensated for 2 the investments and the changes. 3 Gentlemen, that concludes my remarks, and 4 basically I'mhere as a cheerleader. 5 MR. ADAMS: Thankyou verymuch. 6 I believeyou're signedup to participate in 7 tomorrow's hearing regarding efficiency standards for 8 furnaces.

9 MR. FINK: Yes. 10 MR. ADAMS: And I would encourage you to 11 participate in the Department's upcoming rulemaking 12 regarding efficiency standards for water heaters. 13 My question, however, regarding this hearing 14 is whether you orMr. Narang canprovide any written 15 comments on whether the proposedtestprocedures 16 adequately address the testing of a furnace equipped 17 with any of thementionedmodifications orpatented 18 items. 19 MR. FINK: I believethatwe will be 20 addressing those aspects inthe writing, but I didn't 21 think itwas appropriate at this time to get into the 22 details. 23 May I justmention toyou? If you -- I'm 24 sure ifyou take a look at a furnace orwater heater, 25 take a look at thepatent numbers, take a look at the EXECUTIVE COURT REPORTERS, INC. (301) 565-006498 1 years corresponding to those patent numbers. We're 2 justnot getting innovation inproducts today, and 3 that's a shame. 4 MR. ADAMS: Cyrus? 5 MR. NASSERI: As Mr. Adams mentioned, most of 6 these nice features inMr. Narang's patents are 7 basically -- these are the design options concerning 8 the next series ofrulemakings for the standards, and 9 it's very interesting. I hadthe same thing, thatwe 10 would like to getwritten comments of these patents and 11 what they are, sowe canreviewthem. 12 MR. FINK: Thank you. 13 MR. ADAMS: George? James? Gene? 14 MR. MARGOLIS: I have no questions. 15 MR. FINK: Thankyou verymuch. 16 MR. ADAMS: I'mwondering if -- what our 17 possibilities arehere. We are, according to the 18 schedule, scheduled for lunch. We have onemore 19 scheduled speaker, Marion O'Neill. You are here? 20 Okay. 21 Is your -- does your statement fall within 22 the 20-minute guidelines? Okay. 23 I wonder if I couldhave a show of hands if 24 there are anybody in the audience that wants to be 25 unscheduled speaker. One. And do any of the speakers EXECUTIVE COURT REPORTERS, INC. (301) 565-006499 1 wish to offer rebuttal statements? 2 (No response) 3- MR. ADAMS: Are there any questions of 4 speakers that anyonewishes to ask? Have there been 5 anything submittedto the registration desk or if I 6 couldhave a show of hands if there's one question. 7 Okay. I thinkwe'll tryto go ahead and 8 finish it all up in one session, unless there are any 9 violent objections. Hearingnone, I'd like to call 10 Marion O'Neill and SpeakerNumber 7, please. 11 STATEMENT OF MARION O'NEILL 12 PUBLIC SERVICE ELECTRIC &GAS COMPANY 13 MS. O'NEILL: Good morning. 14 My name isMarion O'Neill, and I'm the 15 Manager for Legislative and Regulatory Gas Issues at 16 Public Service Electric and Gas Company inNew Jersey. 17 withme today isMr. FredNguyen, who is a 18 senior staff engineer in our Gas Utilization 19 Department, with technical expertise on the proposal. 20 I'llproceedwithmy written statement, which 21 we did submit yesterday. 22 Public Service Electric and Gas Company is 23 the third largest combination electric and gas 24 distribution company in the nation. Located inNewark, 25 New Jersey, we serve over 5.5million residents, that's EXECUTIVE COURT REPORTERS, INC. (301) 565-0064100 1 70 percent of the state'spopulation, with 1.6million 2 electric customers and 1.5 milliongas customers. 3 Since 1983, we havehad an energy 4 conservation department thathas aggressively 5 implemented a multitude of programs serving all 6 customer segments. Over the years, this conservation 7 efforthas included free home energy audits, workshops, 8 materials for the low-income customer, education 9 programs for schools, special offers on such items as 10 hot waterheaterwraps, low or no interest loans for 11 the installation of conservationmeasures, and, of 12 course, rebates for higher efficiency appliances. 13 Our gas-basedheating rebate programprovides 14 cash incentives to residential gas customers who 15 purchase high efficiencygas furnaces and boilers that 16 have an annual fuel utilization efficiency of 80 17 percent orbetter. 18 Since theprogram's inception in 1983, the 19 companyhas moved the rebate threshold two percent 20 above the u.S. DOE minimum standards. The markethas 21 responded to the rebates, and todaywe haveprovided 22 over 85,000 rebates, totaling some $8.7 million. 23 TheAFUE levels that are applied to 24 appliances per the Gas Manufacturers Association 25 Directory of certified Furnace and Boiler Efficiency EXECUTIVE COURT REPORTERS, INC. (301) 565-0064101 1 Ratings. In 1983, PSE&G initiated a demand-side 2 management programwhich encourages energy conservation 3 in a purposeful way, that defers electric generation 4 and gas-therm consumption away from the peak usage 5 periods as well as year-round. 6 Theprogram, calledthe standard Offer, 7 relies on extensivemeasurement and verification of 8 savings and is designedto not only improve our 9 efficiency as a deliverer of energybut to help our 10 customersmake informedchoices in specifying equipment 11 and the fuel requirements tomeet their demands. 12 Trade-offs in comparisons between electric 13 and gas options are not only allowed but encouraged. 14 In addition to conservation efforts, PSE&G 15 has a very active appliance service department which 16 enables us toworkwithheating appliances firsthand 17 and examine their application inreal-life situations 18 under allkinds of conditions. 19 We haveperformed approximately 268,000 20 heating calls in 1992. The combination of our 21 conservation and service activities has providedus 22 with a unique and, we believe, comprehensive 23 perspective of applying efficiency standards and 24 testing as they affect the energy savings, safety and 25 economicwell-being of our customers. EXECUTIVE COURT REPORTERS, INC. (301) 565-0064102 1 It is the insights derived from this 2 experiencewith respect to theproposed testing 3 standards that we would liketo sharewith you today. 4 We have five major considerations regarding the 5 proposedrule for testprocedures. 6 They include theuse of the annual efficiency 7 descriptor, the applicability of EF andAE descriptors 8 to electric furnaces and boilers, the use of the F 9 factor in the EF andAE calculation, inclusion of an 10 emissions factor, andpilot lights. 11 We believethat the changes from AFUE, which 12 is well understood by the consumer and installing 13 contractors, and uponwhich ourrebate program is 14 predicated, toAE will accomplish littlemore than to 15 create confusion, disqualifying some equipment that now 16 qualifies as being energy efficient, and increasing the 17 operating costs tous, the utility administrating 18 program, to themanufacturers that now must recertify 19 their equipment to a new standard, and to the consumers 20 thatultimatelywill"bear the increased costs. 21 Much of the existing equipment will remain 22 the same. However, any benefits the new testing 23 definitionwouldmake by culling out the equipment on 24 the bottomrung of allowed efficiency inthe name of 25 better accuracywill cause an across-the-board increase EXECUTIVE COURT REPORTERS, INC. (301) 565-0064103 1 in the costs of all equipment because all equipment 2 will have to be retested and redefined. 3 We also very stronglybelieve that ifAFUE is 4 no longer goingto be acceptable to DOE, then the same 5 energy efficiencydescriptors should be used for 6 electric appliances as for fossil fuel appliances. If 7 source energy isbeing considered for the utility 8 electrical input to a gas furnace, then source energy 9 should be considered indetermining the input to an 10 electric furnace. 11 Source energyuse is a useful notion that 12 will allow consumers tomake their own informed 13 decisions between appliances. However, the same 14 methodology should be applied to all heating 15 appliances. 16 The definitions of EF andAE descriptors for 17 electrical appliances will yieldvalues closer to 100 18 since the F factor is not included for these 19 appliances. By includingthe F factor for electrical 20 appliances, all ratings and consumer options will be on 21 even ground. 22 The widespreaduse of demand-side management 23 programs among utilities nationally almost demands that 24 DOE be sensitivetothese conservation efforts and not 25 further segregatetheway differently-fueled appliances EXECUTIVE COURT REPORTERS, INC. (301) 565-0064104 1 are evaluated. To take it one step further, summer 2 cooling appliances should also be comparablymeasured. 3 with respect to the use of the F factor in 4 theAE calculation, the companyunderstands the 5 attractiveness of the single value factor. However, at 6 minimum, it shouldbe regionally and seasonally 7 adjusted so that itcouldbe sensitive to regional 8 variations and canbe fairly applied toMontana, 9 Louisiana or New York. 10 Means of electricgeneration distribution 11 losses vary widelybyregion and season. For example, 12 a combined cycleplantwhich is typically 40 percent 13 efficientwith sevenpercent distribution loss would 14 yield F equal 2.69, while the combustion turbine, which 15 is 25 percent efficientwith 13 percent distribution 16 loss, to account for summer high transformer losses, 17 would yield F equal 4.6. 18 Regional and seasonal adjustments are 19 necessary to account for actual electric generation and 20 systems so that decisions based on demand-side 21 management programs atutilities will trulyreflect 22 what the regional situation is. 23 In addition to our energy conservation 24 efforts, PSE&G has made a public commitment to exceed 25 legislativerequirements inboth our stationary and EXECUTIVE COURT REPORTERS, INC. (301) 565-0064105 1 mobile source emissions programs. 2 Most recently, we joinedwith President 3 Clinton and Energy Secretary O'Leary as a partner in 4 the Global Climate ChangeAction Plan. The action plan 5 identifies a mix ofpartnershipwith business and 6 utilities, economic incentives and new standards and 7 building codes as the vehicle to achieve both 8 environmental and energy targets. 9 We feel that the energydescriptor should 10 also account for air emissions and solidwaste, either 11 producer appliance operation orresulting from a source 12 fuel, as not all BTUs were created equal. Certainly, 13 there is a difference thatweighs significantlyupon 14 the environment thatmust go hand-in-handwith 15 consumers decisions on energyuse. 16 Lastly, regardingpilot lights, the energy 17 descriptor calculations assume the use of pilot lights 18 outside of the heating season as wasted energy. 19 However, furnaces and boilers experience condensation 20 or sweatingduringthe summermonths because of ambient 21 humidity coupledwith coolertemperatures, typically 22 found in summer basements. 23 Any gas servicepersonwould testify from 24 experience that this condition creates corrosion in 25 burners, heat exchangers and control components. This EXECUTIVE COURT REPORTERS, INC. (301) 565-0064106 1 corrosion causes additional service calls and shortens 2 appliance life. Maintaining a pilot light ameliorates 3 this condition and saves additional service 4 requirements and early equipmentreplacement. 5 In conclusion, we do thank the DOE for the 6 opportunity to address our concerns from our customers' 7 perspective, andwe would behappy to provide any 8 additional written comments that youmay require.

9 MR. ADAMS: Thankyou. 10 I have no questions. 11 Cyrus? 12 MR. NASSERI: This issue concerningpilot 13 light, I thinkwe have some evidence that the one with 14 the continuous pilot light, which you're recommending, 15 is going to have an adverse effect. In otherwords, 16 you seemore corrosion on that one, which causes the 17 evaporation of some of thevapor there by the flame or 18 pilot light. 19 So, ifyouhave any evidence or documents 20 that youhave here, itwould be helpful for us to 21 reviewthis. 22 MS. O'NEILL: I'mnot certain ifwe have -- 23 we do have some documentationwithrespect to service 24 calls and equipment, and in fact, before coming, we 25 were trying to analyzewhat specificparts aremost EXECUTIVE COURT REPORTERS, INC. (301) 565-0064107 1 affected, and we can look into the data that we have, 2 if we have anything on pilot lights. 3 I don't know ifyouknow, Fred. 4 MR. NGUYEN: I thinkwhat we have here is 5 more something that's based on experience, where we 6 have years and years of servicepeoplewho have built 7 this idea that the pilot itself has beneficial for the 8 furnace and the boilers, and it's still based on 9 experience. 10 I thinkwe should talk tomost of them, and 11 you will want topoll them. Itwould be rather 12 difficult to go back and test field-installed 13 appliances and find out how long they stay since 14 they've already been removed. 15 However, when we find pilot lights or in 16 New Jersey, we've tremendouslyhumid basements, you 17 would find that many cases when we go on a service call 18 and we find a pilot that's out, you would get excessive 19 corrosion on the components and also in the furnace 20 itself due to the humidity inthe basement. But it's 21 based on serviceman experience. 22 If you have any way you suggest thatwe could 23 verify this, youknow, the fact thatthe pilothas this 24 beneficial, I don'tknow we would go about doing this. 25 DR. KELLY: You know of no papers or no EXECUTIVE COURT REPORTERS, INC. (301) 565-0064108 1 studies or no tests that backup what you're saying? 2 MR. NGUYEN: We feel confident enough about 3 this that we actually advertise through our customers 4 to keep theirpilot lights on during the summer. We 5 actuallyhave at the time it goes into the buildings.

6 DR. KELLY: Do you give them that gas for 7 free? 8 MR. NGUYEN: No. 9 MR. NASSERI: Another justto comment here 10 that you say development of accurate and fuel test 11 procedures. What do youmean by accurate here, 12 accurate testprocedure? Do you have any 13 recommendation thatwe have to improve our test 14 procedure tomake it

-- 15 MS. O'NEILL: No. I think inconsistencywith 16 AGA was that if you're going tomake it accurate, that 17 it should be consistent for both electric and gas 18 appliances, and

-- 19 MR. NASSERI: Well, inreference to that 20 issue, 21 MS. O'NEILL: Yes. Yes. I mean this comes 22 from a gas and combinationutility. So, we happen to 23 be from the gas side of thehouse, butbefore drafting 24 our comments, we did sitdown with our energy 25 conservationpeople to see, youknow, what their EXECUTIVE COURT REPORTERS, INC. (301) 565-0064109 1 thoughts or the electric industry's thoughts would be 2 on this. 3 MR. NGUYEN: I have a comment regarding this. 4 There are rebates on, for instance, gas furnaces and 5 other equipment, such as electric air conditioners, are 6 all based on tests and ratings that are provided 7 through DOE andARI. 8 There seems to be some contradictions here in 9 certain of these

-- the wording of some of these 10 rebates. For instance, you have new equipment that 11 comes out on the market that cannot qualify for a 12 rebate because there is no testingmethod. For 13 instance, there are gas-fired heat pumps which use both 14 fuels, and because they don't have a rating will not 15 receive a rebate, even though they are that much more 16 efficient on the fuel source on the source fuel than an 17 electricheat pump. 18 Also, for instance, an electricheat pump 19 would be rated on its summer ratingwhile, for 20 instance, in New Jersey, electric cooling is minimal 21 compared to heating. So, we are actually awarding on 22 somethingthat's very fictitious, not on actual energy 23 use. 24 25 MR. ADAMS: James? MR. MILLS: No questions. EXECUTIVE COURT REPORTERS, INC. (301) 565-0064110

1 MR. ADAMS: Gene? 2 DR. KELLY: I have no questions. 3 MR. ADAMS: Thank you verymuch. 4 MS. O'NEILL: Thank you. 5 MR. ADAMS: We have had one request by an 6 unscheduled speaker, and I would like to call that 7 person now. Michael Martin. 8 STATEMENT OF MICHAEL MARTIN 9 MR. MARTIN: Thank you very much. 10 My name is Michael Martin. I'm an engineer 11 registered in the State of California. I work for the 12 California Energy Commission. The commission consists 13 of five commissioners, who are appointed by the 14 Governor, without my advice, and they haven't decided 15 exactlywhat theywant to say in terms of testimony for 16 DOE, and, so, I'm speaking strictly on my own, and you 17 can expect some written testimony from the California 18 Energy Commission before the closing date of the 19 process. 20 I am also the chairman of anASHRAE Standards 21 Project Committee, ASHRAE being theAmerican Society of 22 Heating, Refrigeration and Air Conditioning Engineers, 23 146P, which is a consensus testmethod for pool 24 heaters, andMr. Nasseri is one of my votingmembers. 25 This

-- a draft of this standardhas been EXECUTIVE COURT REPORTERS, INC. (301) 565-0064111 1 sent out for public comment, and we have received 2 comments from 18 people. We're going to bemeeting the 3 lastweek of thismonth and trying to resolve these 4 comments, and, fortunately, we have a few days after 5 that inwhich time I can get a report in to you as to 6 justwhat the status is. We hadhoped that this would 7 be in a statewhere you couldreference it. Clearly, 8 it isn't today, andwe'll letyouknow when it is on 9 paper. 10 The major difference in the testmethod that 11 you reference from this one is thatwe include heat 12 pump pool heaters, which I understand are quite popular 13 in Florida, though in California, we see virtually none 14 of them. 15 I have two other comments that I would like 16 tomake. One is at the California Energy Commission, 17 we adopted standards for a great number of appliances, 18 most of which are beingpreempted by federal standards, 19 and our emphasis now is in the collecting and 20 dissemination of information about efficiency. 21 We have a computerizeddata basewith some 22 65,000 entries on it, including a great number of 23 models of the appliances thatyou're discussing this 24 morning, and it's an awful lot of numbers -- ofmodels. 25 This data is available electronicallyto EXECUTIVE COURT REPORTERS, INC. (301) 565-0064112 1 state energy offices and toyou, you can use it, and I 2 haveprovided this in printed form toyou, and on the 3 basis of somebodywho isworking onthis, I would urge 4 you, if you are comingup with a new testparameter, 5 that you do it as soon as possible. 6 I recognize the concernthat the people from 7 GAMA have, butwe do collect information voluntarily. 8 There arepeoplewho want to give this information, and 9 this information is extremelyhelpful in you in 10 developingyour standards, inMr. Mills in developing 11 his labellingrequirements, and in those of us from out 12 of townwho comment onyour efforts. 13 So, I wouldurge that you do this as soon as 14 possible. I do notice that youhave a lot of catching 15 up to do through no fault of your own, and the sooner 16 we canget these things out of theway, the better. 17 I see no advantage inhaving a delay in 18 publishing a method of test. My personal experience is 19 that nobodywants to testbased on a proposal that they 20 have reason to believe is goingto change, and they all 21 want this thingprinted in the Federal Register or 22 somewhere with a nice cover on itthat they canjustify 23 the testing costs. 24 This comes tomy final point that I, inmy 25 duties at the Energy Commission, I domanage a testing EXECUTIVE COURT REPORTERS, INC. (301) 565-0064113 1 contract, which we use for various purposes, and there 2 is an item in there for testing appliances based on 3 changes in DOE testmethods, and I would volunteer our 4 efforts to workwith you should this be necessary for 5 you to see whetherwhat changes these changes in the 6 standards have on the efficiency levels. 7 Our contractor is the American Gas 8 Association based inLos Angeles, who have been in the 9 testing business for longer than I've been alive. 10 Thank you verymuch. Unless you have any 11 questions, that's all I have for you today. 12 MR. ADAMS: Thank you. 13 I have no additional questions. 14 Cyrus? 15 MR. NASSERI: Thank you. 16 I don't have any questions. 17 MR. MARTIN: Maybe I could remind Cyrus that 18 I need his ballotback on that Standard 146, as soon as 19 I can get it. 20 MR. NASSER"!: Okay. 21 MR. ADAMS: Eugene? 22 DR. KELLY: I have no questions. 23 MR. ADAMS: Thankyou. 24 Could the gentlemanwho indicated thathe had 25 a question thathewould liketo ask, please pass that EXECUTIVE COURT REPORTERS, INC. (301) 565-0064114 1 question to the registration -- well, justup here, I 2 guess, and we'll bypass the registration desk, and if 3 there are any otherpeoplewho have questions that they 4 would like to be asked. 5 I would like at this point to ask if any of 6 the speakers would like to give rebuttal statements. 7 Yes, Mr. Fink? You would like to give a rebuttal 8 statement? 9 MR. FINK: Astatement. 10 MR. ADAMS: Okay. Would you -- 11 MR. FINK: I would like to tell a story. 12 MR. ADAMS: Okay. Would you do so now? 13 Hopefully itwill be relevant and not very long. 14 MR. FINK: All the requests for delays 15 reminds me of an old story. Many years ago, a man was 16 found guiltyby a sultan of a heinous crime, and he was 17 told thathe would be executed, and he turned to the 18 sultan, and he said, "Well, I couldteach your horse 19 how to fly in three years. You're going to miss that 20 opportunity." And the sultan said, "Well, in that 21 case, 22 horse 23 you." 24 25 friendthen I'll letyou live, but ifyou don't to fly inthree years, then I'm going to

And as this fellowwas walking away,

came over tohim and said, "Why did you EXECUTIVE COURT REPORTERS, INC. (301) 565-0064 teachmy execute

his tell him115 1 such a crazy thing? You can't teach a horse how to 2 fly." He says, "You neverknow what's going to happen 3 in three years. In three years, the sultanmight die. 4 I might die. Thehorsemight die. Who knows? Maybe I 5 will teach ithow to fly." 6 So, all these requests for delays remind me 7 of that story. 8 MR. ADAMS: Thankyou. 9 (Pause) 10 MR. ADAMS: The questioner, FrankJacob. 11 Could you statewhere you are -- what

-- who you are 12 from orwho you represent? 13 MR. JACOB: I'memployed by Battelle's 14 Columbus Laboratories in Columbus, Ohio. 15 MR. ADAMS: Okay. Procedurally, we are not 16 allowingquestions of thepanel. You also had a 17 question

-- well, youhad a comment for David Goldstein 18 dealingwithwhether consumers are informed about 19 energyusage byblowers. Is that

-- you didn't state 20 it in a question form. 21 MR. JACOB: I directed the question toMr. 22 Mills. The questionwhich followed that statement. 23 MR. ADAMS: The question is for David. Does 24 the cost of operation onthe label and fact sheets 25 includeboth gas and electricity? EXECUTIVE COURT REPORTERS, INC. (301) 565-0064116 1 I guess the subject is whether or not 2 consumers are informed about the energy usage of 3 electrical consumption of presumably fans and blowers 4 and so forth. 5 David, would you like to respond to that or 6 you can do so now or inyour written comments as you 7 choose? 8 MR. GOLDSTEIN: Sure. I'dbe happy to 9 respond to the extent that I can. 10 As I understand it, the label is consistent 11 with the AFUE, and it includes only the costs of the 12 gas usage. 13 Jack? If Jack wants to elaborate? 14 MR. LANGMEAD: The cost of operation that is 15 shown on the fact sheet does include both gas and 16 electric consumption and has for years, and the GAMA 17 directory now lists the electrical consumption as 18 determined by the DOE test procedure in each and every 19 category and gives a method of taking that electrical 20 consumption, the gas'consumption, you back in the cost 21 of operations andyou can do itright out of the GAMA 22 directory, and it is available, and we'll have a copy 23 in the -- alongwith ourwritten statement or I think 24 you've seen itbefore. 25 But the electrical consumption in the cost of EXECUTIVE COURT REPORTERS, INC. (301) 565-0064117 1 operation as dictated by the FTC labellingrequirements 2 includes electrical consumption. 3 DR. KELLY: Tell us what's on the label, 4 Jack. 5 MR. LANGMEAD: What's that? 6 DR. KELLY: Tell us what's on the label. 7 MR. LANGMEAD: Oh, the label, the label is 8 nothing. It's in the fact sheet. The label is saying 9 look at the fact sheet, butwe have the information in 10 the directory that's provided to everypublic -- 11 supplied free of charge to everypublic library in the 12 United states ofAmerica twice a year, current and up13 to-date. 14 NOW, if anybody wants to go lookup their 15 efficiencyrating of their furnace, and if theywant to 16 pay attention to the electrical consumption, that 17 information -- I don't think you can find readily 18 available, more readily available than being sent to 19 everypublic library in theunited states. 20 MR. MILLS: You may want topoint out, Jack, 21 that we have a proposal thatwas made and then remade 22 to allowmanufacturers the option of being listed in an 23 acceptable industry-prepared directorymeeting certain 24 criteriawhich the GAMA directory does, instead of 25 preparing fact sheets, andwe alsohave a proposal to EXECUTIVE COURT REPORTERS, INC. (301) 565-0064118 1 have more information on the label itself than 2 currently is on the current required label.

3 MR. LANGMEAD: Building on that just a little 4 bit, I hope we can develop an energy descriptor that is 5 reflective and simply to relate back to cost of 6 operation, but ifwe get away from looking at cost to 7 consumers, we lose a sales tool on sellingmore 8 efficient equipment. 9 MR. GOLDSTEIN: I think an important question 10 for DOE to be considering in this context is the words 11 "the consumer" are quite ambiguous. 12 Jack is certainly correct that the 13 information is available to an individual consumer who 14 goes to the effort to find it out. Generally, when one 15 talks about the consumer, one refers to the behavior of 16 the bulk of consumers in the marketplace, and in that 17 case, the use of single parameter descriptors like 18 energy factor, AFUE, is, I think, all that -- the most 19 that you can regularly count on on happening. 20 We justheard some testimony this morning 21 from a utility thatpresumablyhas a lotmore 22 engineering expertise thanmost of their customers, and 23 they're basingtheir rebateprogram on simpleAFUE 24 descriptors. 25 So, I think that's the way the market is EXECUTIVE COURT REPORTERS, INC. (301) 565-0064119 1 responding dominantly right now, although as Mr. 2 Langmeadpointed out, themore detailed information is 3 quite available. 4 MR. ADAMS: Thankyou. 5 MR. MARGOLIS: Mr. Jacobs, with regard to 6 your, quote unquote, first question, I will take that 7 to be a point of clarificationthat you're asking, and 8 not that as a questionto a panelmember, which is not 9 authorizedby our statute for this hearing. 10 Tomorrow, yes, but, today, but your question 11 was, and I

-- in the currenttestprocedure, the EF, 12 energy factor, uses F equals 1.0, true or false? The 13 answer is true. 14 In theproposed changes, EF uses F equals 15 3.37, true or false? As a matter of point of 16 clarification, the answer isyes. So, the answer is 17 yes for both those. We don'twant to not answer you, 18 butjustwant to seewhat the law is. So, I'musing 19 that as a clarification. 20 MR. ADAMS: Okay. At this point, there being 21 no other speakers, no otherrebuttal statements, and no 22 other questions, I will adjournthe hearing. 23 Thank youverymuch. 24 (Whereupon, thehearingwas adjourned.) 25 EXECUTIVE COURT REPORTERS, INC. (301) 565-0064" 

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