[Federal Register Volume 80, Number 67 (Wednesday, April 8, 2015)]
[Proposed Rules]
[Pages 18784-18795]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2015-07956]


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DEPARTMENT OF ENERGY

10 CFR Part 430

[Docket Number EERE-2014-BT-STD-0045]
RIN 1904-AD48


Energy Conservation Program for Consumer Products: Definitions 
for Residential Water Heaters

AGENCY: Office of Energy Efficiency and Renewable Energy, Department of 
Energy.

ACTION: Notice of proposed rulemaking (NOPR).

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SUMMARY: The Energy Policy and Conservation Act of 1975 (EPCA), as 
amended, prescribes energy conservation standards for various consumer 
products and certain commercial and industrial equipment, including 
residential water heaters. EPCA also requires the U.S. Department of 
Energy (DOE) to determine whether more stringent amended standards 
would be technologically feasible and economically justified, and would 
save a significant amount of energy. Accordingly, DOE established 
amended energy conservation standards for several classes of 
residential water heaters in an April 2010 final rule. In this notice, 
DOE proposes to amend its definitions pertaining to residential water 
heaters and to clarify the applicability of energy conservation 
standards for residential water heaters that are utilized as a 
secondary back-up heat source in solar-thermal water heating systems. 
Specifically, DOE is proposing to create a definition for ``solar-
assisted fossil fuel storage water heater'' and ``solar-assisted 
electric storage water heater'' and clarify that water heaters meeting 
these definitions are not subject to the amended energy

[[Page 18785]]

conservation standards for residential water heaters established by the 
April 2010 final rule.

DATES: DOE will accept comments, data, and information regarding this 
notice of proposed rulemaking (NOPR) no later than May 8, 2015. See 
section V, ``Public Participation'' for details.

ADDRESSES: Any comments submitted must identify the NOPR for Energy 
Conservation Standards for Residential Water Heaters, and provide 
docket number EERE-2014-BT-STD-0045 and/or regulatory information 
number (RIN) number 1904-AD48. Comments may be submitted using any of 
the following methods:
    1. Federal eRulemaking Portal: www.regulations.gov. Follow the 
instructions for submitting comments.
    2. Email: <a href="/cdn-cgi/l/email-protection#4d1f283e1a2c39283f05282c39283f7f7d7c791e19097d7d79780d282863292228632a223b"><span class="__cf_email__" data-cfemail="4517203612243120370d202431203777757471161101757571700520206b212a206b222a33">[email protected]</span></a>. Include the docket 
number and/or RIN in the subject line of the message.
    3. Mail: Ms. Brenda Edwards, U.S. Department of Energy, Building 
Technologies Program, Mailstop EE-2J, 1000 Independence Avenue SW., 
Washington, DC 20585-0121. If possible, please submit all items on a 
CD. It is not necessary to include printed copies.
    4. Hand Delivery/Courier: Ms. Brenda Edwards, U.S. Department of 
Energy, Building Technologies Program, 950 L'Enfant Plaza SW., Suite 
600, Washington, DC 20024. Telephone: (202) 586-2945. If possible, 
please submit all items on a CD, in which case it is not necessary to 
include printed copies.
    For detailed instructions on submitting comments and additional 
information on the rulemaking process, see section V of this document 
(Public Participation).
    Docket: The docket, which includes Federal Register notices, public 
meeting attendee lists and transcripts, comments, and other supporting 
documents/materials, is available for review at regulations.gov. All 
documents in the docket are listed in the regulations.gov index. 
However, some documents listed in the index, such as those containing 
information that is exempt from public disclosure, may not be publicly 
available.
    A link to the docket Web page can be found at: http://www.regulations.gov/#!docketDetail;D=EERE-2014-BT-STD-0045. This Web 
page will contain a link to the docket for this notice on the 
regulations.gov site. The regulations.gov Web page will contain simple 
instructions on how to access all documents, including public comments, 
in the docket. See section V for further information on how to submit 
comments through www.regulations.gov.
    For further information on how to submit a comment, review other 
public comments and the docket, contact Ms. Brenda Edwards at (202) 
586-2945 or by email: <a href="/cdn-cgi/l/email-protection#2c6e5e4942484d0269485b4d5e485f6c494902484349024b435a"><span class="__cf_email__" data-cfemail="420030272c26236c072635233026310227276c262d276c252d34">[email protected]</span></a>.

FOR FURTHER INFORMATION CONTACT: Ashley Armstrong, U.S. Department of 
Energy, Office of Energy Efficiency and Renewable Energy, Building 
Technologies Program, EE-2J, 1000 Independence Avenue SW., Washington, 
DC 20585-0121. Telephone: (202) 586-6590. Email: 
<a href="/cdn-cgi/l/email-protection#713002191d14085f30031c0205031e1f163114145f151e145f161e07"><span class="__cf_email__" data-cfemail="6524160d09001c4b2417081611170a0b022500004b010a004b020a13">[email protected]</span></a>.
    Johanna Hariharan, U.S. Department of Energy, Office of the General 
Counsel, GC-33, 1000 Independence Avenue SW., Washington, DC 20585-
0121. Telephone: (202) 287-6307. Email: <a href="/cdn-cgi/l/email-protection#743e1b1c151a1a155a3c15061d1c1506151a341c055a101b115a131b02"><span class="__cf_email__" data-cfemail="d19bbeb9b0bfbfb0ff99b0a3b8b9b0a3b0bf91b9a0ffb5beb4ffb6bea7">[email protected]</span></a>.

SUPPLEMENTARY INFORMATION:

Table of Contents

I. Introduction
    A. Authority
    B. Background
II. Summary of the Proposed Rule
III. General Discussion
    A. Product Classes
    1. General Description
    2. Comments on te General Advantages of Solar Heating Systems
    3. Design and Heating Rate Differences
    D. Conclusions
IV. Procedural Issues and Regulatory Review
    A. Review Under Executive Orders 12866 and 13563
    B. Review Under the Regulatory Flexibility Act
    C. Review Under the Paperwork Reduction Act
    D. Review Under the National Environmental Policy Act of 1969
    E. Review Under Executive Order 13132
    F. Review Under Executive Order 12988
    G. Review Under the Unfunded Mandates Reform Act of 1995
    H. Review Under the Treasury and General Government 
Appropriations Act, 1999
    I. Review Under Executive Order 12630
    J. Review Under the Treasury and General Government 
Appropriations Act, 2001
    K. Review Under Executive Order 13211
    L. Review Under the Information Quality Bulletin for Peer Review
V. Public Participation
    A. Submission of Comments
    B. Issues on Which DOE Seeks Comment
VI. Approval of the Office of the Secretary

I. Introduction

    The following section briefly discusses the statutory authority 
underlying DOE's standards for residential water heaters and this NOPR, 
as well as some of the relevant historical background related to the 
establishment of standards for residential water heaters.

A. Authority

    Title III of the Energy Policy and Conservation Act, as amended \1\ 
(42 U.S.C. 6291 et seq.; hereinafter ``EPCA'') sets forth various 
provisions designed to improve energy efficiency. Part A of title III 
of EPCA (42 U.S.C. 6291-6309) establishes the ``Energy Conservation 
Program for Consumer Products Other Than Automobiles,'' which covers 
consumer products and certain commercial products (hereinafter referred 
to as ``covered products'').\2\ These covered products include 
residential water heaters, which are the subject of this notice. (42 
U.S.C. 6292(a)(4))
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    \1\ All references to EPCA in this document refer to the statute 
as amended through the American Energy Manufacturing Technical 
Corrections Act (AEMTCA), Public Law 112-210 (Dec. 18, 2012).
    \2\ For editorial reasons, upon codification in the U.S. Code, 
Part B was re-designated Part A.
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    Under EPCA, energy conservation programs generally consist of four 
parts: (1) Testing, (2) labeling, (3) establishing Federal energy 
conservation standards, and (4) certification and enforcement 
procedures. The Federal Trade Commission (FTC) is primarily responsible 
for labeling consumer products, and DOE implements the remainder of the 
program.
    EPCA contains what is known as an ``anti-backsliding'' provision, 
which prevents the Secretary from prescribing any amended standard that 
either increases the maximum allowable energy use or decreases the 
minimum required energy efficiency of a covered product. (42 U.S.C. 
6295(o)(1)) Also, the Secretary may not prescribe an amended or new 
standard if interested persons have established by a preponderance of 
the evidence that the standard is likely to result in the 
unavailability in the United States of any covered product type (or 
class) of performance characteristics (including reliability), 
features, sizes, capacities, and volumes that are substantially the 
same as those generally available in the United States. (42 U.S.C. 
6295(o)(4))

B. Background

    EPCA prescribed energy conservation standards for residential water 
heaters (42 U.S.C. 6295(e)(1)) and directed DOE to conduct rulemakings 
to determine whether to amend these standards. (42 U.S.C. 6295(e)(4)) 
DOE notes that under 42 U.S.C. 6295(m), the agency must periodically 
review its already established energy conservation standards for a 
covered product. Under this requirement, the next review that

[[Page 18786]]

DOE would need to conduct must occur no later than six years from the 
issuance of a final rule establishing or amending a standard for a 
covered product.
    On January 17, 2001, DOE published a final rule prescribing the 
Federal energy conservation standards for residential water heaters 
that are currently in effect for units manufactured on or after January 
20, 2004. 66 FR 4474 (``January 2001 Final Rule''). The January 2001 
Final Rule set minimum energy factors (EFs) that vary based on the 
storage volume of the water heater, the type of energy it uses (i.e., 
gas, oil, or electricity), and whether it is a storage, instantaneous, 
or tabletop model. 66 FR 4474; 10 CFR 430.32(d). Table I.1 presents the 
current Federal energy conservation standards for residential water 
heaters.

 Table I.1--Current Federal Energy Efficiency Standards for Residential
                              Water Heaters
------------------------------------------------------------------------
                                        Energy factor as of January 20,
            Product class                             2004
------------------------------------------------------------------------
Gas-fired Water Heater...............  EF = 0.67 - (0.0019 x Rated
                                        Storage Volume in gallons).
Oil-fired Water Heater...............  EF = 0.59 - (0.0019 x Rated
                                        Storage Volume in gallons).
Electric Water Heater................  EF = 0.97 - (0.00132 x Rated
                                        Storage Volume in gallons).
Tabletop Water Heater................  EF = 0.93 - (0.00132 x Rated
                                        Storage Volume in gallons).
Instantaneous Gas-fired Water Heater.  EF = 0.62 - (0.0019 x Rated
                                        Storage Volume in gallons).
Instantaneous Electric Water Heater..  EF = 0.93 - (0.00132 x Rated
                                        Storage Volume in gallons).
------------------------------------------------------------------------

    On April 16, 2010, DOE published a final rule in the Federal 
Register amending the energy conservation standards for residential 
water heaters for a second time (hereinafter ``April 2010 final 
rule''). 75 FR 20111. The updated standards maintained the existing 
product class structure, dividing water heaters based on the type of 
energy used (i.e., gas, oil, or electricity) and whether it is a 
storage, instantaneous, or tabletop model, but also differentiated 
standard levels for electric and gas-fired storage water heaters based 
on whether the rated storage volume is greater than 55 gallons, or less 
than or equal to 55 gallons. Compliance with the energy conservation 
standards contained in the April 2010 final rule will be required 
starting on April 16, 2015. Id.
    Table I.2 presents the amended Federal energy conservation 
standards for residential water heaters, which are also set forth in 10 
CFR 430.32(d).

Table I.2--Amended Federal Energy Conservation Standards for Residential
           Water Heaters Established by April 2010 Final Rule
------------------------------------------------------------------------
                                         Energy factor as of April 16,
            Product class                             2015
------------------------------------------------------------------------
Gas-fired Water Heater...............  For tanks with a Rated Storage
                                        Volume at or below 55 gallons:
                                        EF = 0.675 - (0.0015 x Rated
                                        Storage Volume in gallons).
                                       For tanks with a Rated Storage
                                        Volume above 55 gallons: EF =
                                        0.8012 - (0.00078 x Rated
                                        Storage Volume in gallons).
Oil-fired Water Heater...............  EF = 0.68 - (0.0019 x Rated
                                        Storage Volume in gallons).
Electric Water Heater................  For tanks with a Rated Storage
                                        Volume at or below 55 gallons:
                                        EF = 0.960 - (0.0003 x Rated
                                        Storage Volume in gallons).
                                       For tanks with a Rated Storage
                                        Volume above 55 gallons: EF =
                                        2.057 - (0.00113 x Rated Storage
                                        Volume in gallons).
Tabletop Water Heater................  EF = 0.93 - (0.00132 x Rated
                                        Storage Volume in gallons).
Instantaneous Gas-Fired Water Heater.  EF = 0.82 - (0.0019 x Rated
                                        Storage Volume in gallons).
Instantaneous Electric Water Heater..  EF = 0.93 - (0.00132 x Rated
                                        Storage Volume in gallons).
------------------------------------------------------------------------

    On October 21, 2014, DOE published a Request for Information (RFI) 
in the Federal Register regarding test procedures and energy 
conservation standards for residential solar water heaters (hereinafter 
the ``October 2014 RFI''). 79 FR 62891. Specifically, the October 2014 
RFI requested comment on the following topics:
    1. Solar water heating technologies that utilize a secondary 
heating source that are currently available to the consumer.
    2. Design differences between water heaters that are designed to be 
part of a solar water heating system compared to those meant for 
typical residences without a solar water heating system.
    3. Heating rates and the amount of hot water that can be supplied 
by water heaters meant to serve as a secondary heat source for a solar 
collector compared to the heating rates and hot water supply capacity 
water heaters.
    4. The fractions of single tank and dual tank solar water heating 
systems, and whether the secondary water heaters used include design 
features that differ from conventional residential water heaters.
    5. The manufacturers of water heaters used in solar thermal 
installations, the market share of each manufacturer, and whether any 
of them are small businesses.
    6. The total annual shipments of the market for solar water heating 
systems that utilize secondary heat sources, the fractions of water 
heaters that are used to provide secondary water heating by rated 
volume, input capacity, and fuel type.
    7. Any other attributes of solar water heating tanks which 
distinguish them from conventional storage or instantaneous water 
heaters. 79 FR 62891, 62893-94 (Oct. 21, 2014).

II. Summary of the Proposed Rule

    After considering the comments on the RFI and the characteristics 
and applications of hot water storage tanks used in solar thermal 
systems and having a backup gas, oil, or electric heat source, DOE has 
tentatively concluded that the analysis conducted for the April 2010 
final rule did not adequately consider such applications and the 
accompanying backup tanks. Therefore, in this NOPR, DOE is proposing to 
add clarifying text to 10 CFR 430.32(d) indicating that the energy 
conservation standards for residential water heaters

[[Page 18787]]

do not apply to water heaters meeting the new definitions of ``solar-
assisted fossil fuel storage water heater'' and ``solar-assisted 
electric storage water heater,'' that are also proposed in this NOPR. 
(See section III.D of this NOPR for the proposed definitions.)

III. General Discussion

    As stated in section I.B, compliance with an amended energy 
conservation standard for residential water heaters will be required 
beginning on April 16, 2015. 75 FR 20111. DOE has tentatively concluded 
that hot water storage tanks used in solar thermal systems that have a 
backup gas, oil, or electric heat source were not adequately considered 
in the analysis for the April 2010 rule. Therefore, DOE is undertaking 
this rulemaking to clarify the scope of DOE's existing energy 
conservation standards for residential water heaters.
    In response to the October 2014 RFI, DOE received 4 written 
comments from the following interested parties: American Council for an 
Energy-Efficient Economy (ACEEE),\3\ Air-Conditioning, Heating and 
Refrigeration Institute (AHRI), Rheem Manufacturing Company (Rheem) and 
Solar Energy Industries Association (SEIA).\4\ These comments are 
discussed further in the sections below as they relate to the specific 
issues discussed in this NOPR.
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    \3\ ACEEE submitted a joint comment on behalf of ACEEE, 
Appliance Standards Awareness Project (ASAP), and Natural Resources 
Defense Council (NRDC), and this comment is referred to throughout 
this document as the ``ACEEE joint comment.''
    \4\ SEIA submitted a joint comment on behalf of SEIA, 
International Association of Plumbing and Mechanical Officials 
(IAPMO) and Solar Rating and Certification Corporation (SRCC), and 
this comment is referred to throughout this document as the ``SEIA 
joint comment.''
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    Generally, the ACEEE joint comment recommended that DOE not 
consider a rulemaking to adopt a new minimum efficiency standard for 
residential solar-thermal water heaters because the extremely small 
sales volume of these products does not justify the effort to set a 
standard. The ACEEE joint comment argued that customers of these 
expensive systems would buy only from reputable manufacturers and 
installers and use either the ENERGY STAR brand or a high rating under 
the SRCC program to guide their purchasing decision. (ACEEE joint 
comment, No. 2 at p. 1-2) The ACEEE joint comment also recommended that 
DOE not consider a rulemaking to adopt a new test method for 
residential solar-thermal water heating systems because a widely 
accepted non-federal test method and rating program for solar water 
heaters built around OG-300 solar system ratings already exists. (ACEEE 
joint comment, No. 2 at p. 1) The SEIA joint comment recommended an 
exemption be established for backup water heaters which prioritize 
solar heating over the secondary heat source and that the volume heated 
by the secondary heat source be less than or equal to 55 gallons. (SEIA 
joint comment, No. 5 at p. 6) Similarly, Rheem commented that the 
residential water heater standard for conventional water heaters should 
not be applied to solar water heaters because they are different 
systems and not direct substitutes. (Rheem, No. 4 at p. 2)
    DOE generally agrees with these commenters' points and notes that 
the purpose of this NOPR is not to consider new energy conservation 
standards or test methods for solar water heating systems, but rather 
to clarify the scope of DOE's existing standards. Specifically, DOE is 
proposing amendments to clarify that DOE's standards for residential 
water heaters are not applicable to water heaters that are used as a 
backup heat source in solar thermal water heating systems.

A. Product Classes

    When evaluating and establishing energy conservation standards, DOE 
divides covered products into product classes by the type of energy 
used or by capacity or other performance-related features that justify 
a different standard. In making a determination whether a performance-
related feature justifies a different standard, DOE must consider such 
factors as the utility to the consumer of the feature and other factors 
DOE determines are appropriate. (42 U.S.C. 6295(q))
    Existing energy conservation standards divide residential water 
heaters into product classes based on primary energy source (i.e., gas, 
oil, or electricity), whether it is instantaneous or storage, and 
whether it is a ``tabletop'' model. Storage capacity and input rate are 
used to determine whether a water heater is characterized as storage or 
instantaneous. (42 U.S.C. 6291(27)) For example, an instantaneous water 
heater must contain no more than one gallon of water per 4,000 Btu per 
hour of input. (42 U.S.C. 6291(27)(B)). EPCA establishes the input-rate 
limitations for residential water heaters (42 U.S.C. 6291(27)), and DOE 
has further established limitations at 10 CFR 430.2 based on rated 
storage volume and the temperature to which the water can be delivered. 
Table III.1 shows the input and volume limitations that define the 
current range of water heaters subject to standards. In addition to the 
criteria listed in Table III.1, if a water heater is designed to heat 
water to a temperature of less than 180 [deg]F, it is classified as 
residential, while any water heater that heats water to temperatures at 
or above 180 [deg]F is classified as commercial. In the amended energy 
conservation standard established by the April 2010 final rule and 
effective April 16, 2015, rated storage volume is used to determine the 
applicable standard. Gas and electric water heaters with rated storage 
volumes above 55 gallons are subject to more stringent standards than 
smaller water heaters of the same fuel type. 10 CFR 430.32(d).
    Residential water heaters that use solar energy only are not 
covered by DOE regulations for residential water heaters since they do 
not utilize gas, oil, or electricity as required by the definition of a 
``water heater'' under EPCA. (42 U.S.C. 6291(27)) However, residential 
water heaters that use solar energy but that are combined with storage 
tanks with secondary or backup energy sources that use electricity, 
gas, or oil are covered, provided that they meet all other requirements 
to be considered a ``water heater''. This rule considers only solar-
thermal tanks designed for residential use; therefore, the water heater 
must be described by the fuel type and volumes specified in Table I.2 
and reiterated in Table III.1 and meet the input capacity limitations 
set forth in EPCA and shown below in Table III.1. (42 U.S.C. 6291(16))

     Table III.1--Residential Storage Water Heater Scope of Coverage
------------------------------------------------------------------------
                                     Rated storage
          Product class                 volume          Input capacity
------------------------------------------------------------------------
Gas-Fired Storage...............  >=20 gal and <=100  <=75 kBtu/h
                                   gal.
Oil-Fired Storage...............  <=50 gal..........  <=105 kBtu/h
Electric Storage................  >=20 gal and <=120  <=12 kW
                                   gal.
Tabletop........................  >=20 gal and <=100  <=12 kW
                                   gal.
------------------------------------------------------------------------

B. Solar Water Heating Technologies

1. General Description
    Solar water heating systems that are the subject of this NOPR 
generally consist of a solar collector to capture heat from the sun and 
a storage tank that stores the potable water that has been heated by 
the solar collector for use on demand. These systems typically require 
a secondary heat source for times when solar energy is not sufficient 
to provide adequate hot water. In the October 2014 RFI, DOE requested

[[Page 18788]]

comment on current solar water heating technology practices in the 
United States and, specifically, on solar water heating technologies 
that utilize a secondary heating source and are currently available to 
consumers. 79 FR 62891, 62893 (Oct. 21, 2014).
    Both Rheem's comment and the SEIA joint comment stated that all 
solar water heating systems sold in the U.S. today are paired with a 
conventional backup heating source (SEIA joint comment, No. 5 at p. 2, 
Rheem, No. 4 at p. 2). Furthermore, the SEIA joint comment specified 
that a single-tank electric/solar water heating system consists of a 
single tank which serves as both a solar storage tank and a 
conventional water heater (when adequate solar energy is unavailable). 
In these tanks, a 4.5 kW electric element is commonly located in the 
upper part of the tank, leaving one-half to two-thirds of the tank 
unheated by the electric element due to temperature stratification, 
which causes the heated water to remain mostly in the upper part of the 
tank. (SEIA joint comment, No. 5 at p. 2)
2. Comments on the General Advantages of Solar Heating Systems
    In the October 2014 RFI, DOE requested comment on any other 
attributes of solar water heating systems that utilize secondary 
heating tanks, which distinguish them from conventional storage or 
instantaneous water heaters. 79 FR 62891, 62893 (Oct. 21, 2014).
    The SEIA joint comment stated that solar water heating systems 
offer advantages over conventional water heating equipment that are 
overlooked or not understood. For example, solar water heating systems 
provide lower peak load requirements (which can be beneficial to 
utility companies), are not sensitive to flow rates, and have lower 
maintenance requirements than instantaneous heating systems. (SEIA 
joint comment, No. 5 at p. 8) The commenters also noted that solar 
water heating systems have several advantages over heat pump water 
heaters, including better performance in cold climate, no air 
circulation considerations, and no special skills required to install 
and maintain. (SEIA joint comment, No. 5 at p. 9)
3. Design and Heating Rate Differences
    In the October 2014 RFI, DOE specifically sought comment on the 
design differences between water heaters that are designed to be part 
of a solar water heating system compared to those meant for typical 
residences without a solar water heating system. DOE also requested 
comment on the heating rates and the amount of hot water that can be 
supplied by water heaters meant to serve as a secondary heat source for 
a solar collector compared to the heating rates and hot water supply 
capacity of other water heaters, and whether there are any other 
attributes of solar water heating systems that utilize secondary 
heating tanks that distinguish them from conventional storage or 
instantaneous water heaters. 79 FR 62891, 62893 (Oct. 21, 2014).
    AHRI's comment, Rheem's comment, and the SEIA joint comment stated 
that generally solar water heaters that use secondary heating tanks are 
fairly similar to conventional water heaters. (AHRI, No. 3 at p. 2, 
Rheem, No. 4 at p. 5)
    In noting the design differences between conventional water heaters 
and those used in solar-thermal water heating systems, AHRI, Rheem and 
the joint SEIA comment stated that there is a range of design 
differences in water heaters intended to be part of a solar thermal 
installation and those intended for a conventional installation. Water 
heaters intended for use in solar-thermal systems typically have two 
extra threaded ports as well as specifically designed controls. Other 
features may include special heat exchangers or additional backup 
heating elements. (AHRI, No. 3 at p. 1, Rheem, No. 4 at p. 3, SEIA 
joint comment, No. 5 at p. 4) On the other hand, the ACEEE joint 
commenters stated that they would be surprised to find many products 
specifically designed as auxiliary heat sources for solar thermal water 
heating systems, and that the only special features for a solar storage 
tank by itself would be a double-wall water-to-water heat exchanger for 
indirect systems employing non-potable antifreeze in the primary loop. 
(ACEEE joint comment, No. 2 at p. 2)
    Several commenters stated that solar water heaters are sized 
differently than conventional water heaters. The SEIA joint comment 
stated that the solar component of a typical 80 gallon solar/electric 
system can heat between 40 and 80 gallons depending on the level of 
solar radiation and the rate of use, where up to 40 gallons is heated 
by the electric element. (SEIA joint comment, No. 5 at p. 6)
    Rheem also stated that their 80 and 120 gallon storage water 
heaters can provide up to 40 gallons of backup element water heating 
capacity regardless of the tank volume. (Rheem, No. 4 at p. 3) AHRI's 
comment and the SEIA joint comment stated that the performance 
characteristics of solar water heaters can be less than a standard 
water heater. (AHRI, No. 3 at p. 2, SEIA joint comment, No. 5 at p. 6)
    Another design difference that was noted by commenters centered 
around the location and number of the plumbing connections on the 
storage tank that are used in solar thermal systems. Rheem commented 
that the cold water inlet connections on solar water heating storage 
tanks are located at the bottom to prevent mixing with heated water as 
compared to the cold water inlet being typically located at the top of 
a traditional storage tank. (Rheem, No. 4 at p. 4) Rheem also commented 
that the features of its solar storage water heater increase the 
manufacturing complexity and cost of the heaters, and therefore it is 
not anticipated that the heaters would be substituted for a standard 
water heater in an installation without a solar collector. (Rheem, No. 
4 at p. 5)
    DOE considered all of the above comments when developing its 
tentative conclusions regarding solar-assisted electric storage water 
heaters and solar-assisted fossil fuel storage water heaters (see 
section III.D).

C. Solar Water Heating Markets

    DOE has conducted preliminary research to investigate the solar 
water heating equipment market. Based on a report by the National 
Renewable Energy Laboratory (NREL), DOE distinguished between two 
distinct periods of solar water heater installations. From 1985 to 
2005, when there were no tax incentives for solar water heaters, the 
number of installations ranged from approximately 5,000 to 10,000 
annually. Federal and State tax incentives were instituted in 2006. 
Between 2006 and 2010, there were between approximately 18,000 and 
33,500 solar thermal water heater systems installed annually in the 
U.S.
    In the October 2014 RFI, DOE requested comments on various topics 
related to the market for solar water heating systems. Specifically, 
DOE requested information on the fractions of single tank and dual tank 
solar water heating systems. DOE also sought comments on the 
manufacturers of water heaters used in solar thermal installations, as 
well as the market share of each manufacturer, and whether any of them 
are small businesses. Lastly, DOE sought input regarding the total 
annual shipments of solar water heating systems that utilize secondary 
heat sources, the fractions of water heaters that are used to provide 
secondary water heating by rated volume, input capacity, and fuel type. 
79 FR 62891, 62893 (Oct. 21, 2014).

[[Page 18789]]

    The SEIA joint comment stated that dual tank systems are normally 
only used when the end use is heating water with natural gas, propane, 
or fuel oil, and that most dual tank systems are located in areas with 
strong financial incentives. (SEIA joint comment, No. 5 at p. 6) The 
following market distribution of systems is currently certified by the 
SRCC: 43 percent of systems are dual tank, 45 percent are single tank, 
and 12 percent are tankless. (SEIA joint comment, No. 5 at p. 6 n.13) 
For dual tank systems, the distribution by fuel type certified by the 
SRCC is as follows: 54 percent use natural gas as backup, 45 percent 
use electricity, and 1 percent use oil. (SEIA joint comment, No. 5 at 
p. 7) Regarding the number of units actually installed, the SEIA joint 
comment estimated that the ratio of single tank to dual tank systems 
installed is 4 to 1. (SEIA joint comment, No. 5 at p. 7)
    Rheem commented that it sells solar thermal systems with a single 
storage tank. Rheem noted that some installers have the opportunity to 
install multiple small tanks or combinations of tanks to store heat 
collected when sunlight is available, and that specific designs are 
based on the hot water requirement of the dwelling and the solar 
capacity available from the collectors. (Rheem, No. 4 at p. 3)
    The SEIA joint comment provided the market share of water heater 
manufacturers for the entire market as follows: A.O. Smith represents 
about half of the total U.S. market for water heaters (50 percent), 
Rheem approximately one third (33 percent), and Bradford White holds 
about 13 percent market share; the remaining 4 percent is comprised of 
other brands. (SEIA joint comment, No. 5 at p. 7) Rheem stated that 
solar thermal water heating systems are a low sales volume product for 
Rheem, and that it is a major manufacturer of storage water heaters. 
(Rheem, No. 4 at p. 3)
    Regarding annual shipments of solar water heating systems, the SEIA 
joint comment stated that in 2013, 2,200 solar water heating systems 
using 80 or 120 gallon tanks received a rebate for installation in 
Hawaii (excluding Kauai County). In addition, solar water heating 
systems installed on new single-family home construction with tanks in 
the 65 to 120 gallon range can be estimated at 1,500 per year. (SEIA 
joint comment, No. 5 at p. 7) Based on a report from International 
Energy Agency Solar Heating and Cooling Programme, the SEIA joint 
comment estimates that 22,500 new solar domestic water heating systems 
are being installed in the U.S. annually. (SEIA joint comment, No. 5 at 
p. 8) Rheem commented that its annual sales of thermal storage water 
heaters is less than one day of production of conventional storage 
water heaters. (Rheem, No. 4 at p. 3)

D. Conclusions

    DOE has considered the comments discussed in sections III.B and 
III.C and has tentatively determined that solar-assisted electric 
storage water heaters and solar-assisted fossil fuel storage water 
heaters are distinguishable from other categories of storage water 
heaters. Even though solar-assisted water heaters use electricity or 
fossil fuel to heat water without the use of solar thermal panels, DOE 
notes that the heating capacity of the tank with a comparable rated 
storage volume is reduced based on the design difference of the heating 
element or the fossil fuel burner. The plumbing configuration of the 
tank is also different in order for the storage tank to utilize the 
solar heated water in an optimized manner. DOE further notes that 
purchasers of these solar-assisted water heating systems may not be 
considering the economic criteria of the storage water heater tank 
alone, given that a significant portion of the installed cost of these 
systems is attributable to the solar thermal portion of the system and 
that a substantial portion of the water heating load may be provided by 
solar energy, as opposed to marketed fuels such as electricity, gas, or 
oil. These purchasers, therefore, may place an added value on owning a 
``green'' system, which could provide different economic and 
performance benefits to these consumers when compared to an electric or 
fossil fuel storage water heater. For these reasons, DOE has determined 
that the minimum efficiency standard levels promulgated in the April 
16, 2010 final rule do not apply to these categories of water heaters.
    In order to clarify the applicability of DOE's regulations to 
solar-assisted water heaters, DOE proposes to define the terms ``solar-
assisted electric storage water heater'' and ``solar-assisted fossil 
fuel storage water heater'' at 10 CFR 430.2 and clarify that products 
meeting these definitions are not subject to DOE's current or amended 
standards for residential water heaters at 10 CFR 430.32(d). In 
addition to the data and comments received in response to the request 
for information, DOE also used the certified ratings from DOE's 
Compliance Certification Data base, as of February 2015, to gather 
information such as average first hour ratings for basic models being 
distributed in commerce for various storage volumes.\5\ More 
specifically, DOE used the average first hour rating of the electric 
storage water heaters with a rated storage volume of 50 gallons, the 
average first hour rating of the gas-fired storage water heaters with a 
rated storage volume of 40 gallons, and the average first hour rating 
of the oil storage water heaters with a rated storage volume of 32 
gallons to develop parts of the definitions below.
---------------------------------------------------------------------------

    \5\ See http://www.regulations.doe.gov/certification-data/CCMS-79222842113.html for additional information and access to the data 
that DOE analyzed.
---------------------------------------------------------------------------

    Based on the comments discussed in section II.B, DOE proposes to 
define a solar-assisted electric storage water heater as a product that 
utilizes electricity to heat potable water for use outside the heater 
upon demand and--
    (A) stores water at a thermostatically controlled temperature with 
an input of 12 kilowatts or less;
    (B) has at least two threaded ports in addition to those used for 
introduction and delivery of potable water for the supply and return of 
water or a heat transfer fluid heated externally by solar panels;
    (C) does not have electric resistance heating elements located in 
the lower half of the storage tank;
    (D) has the temperature sensing device that controls the auxiliary 
electric heat source located in the upper half of the storage tank; and
    (E) has a certified first hour rating less than 63 gallons.
    Similarly, DOE proposes to define a solar-assisted fossil fuel 
storage water heater at 10 CFR 430.2 as a product that utilizes oil or 
gas to heat potable water for use outside the heater upon demand and--
    (A) stores water at a thermostatically controlled temperature, 
including gas storage water heaters with an input of 75,000 Btu per 
hour or less and oil storage water heaters with an input of 105,000 Btu 
per hour or less;
    (B) has at least two threaded ports in addition to those used for 
introduction and delivery of potable water for the supply and return of 
water or a heat transfer fluid heated externally by solar panels;
    (C) has the burner located in the upper half of the storage tank;
    (D) has the temperature sensing device that controls the auxiliary 
gas or oil heat source located in the upper half of the storage tank; 
and
    (E) has a certified first hour rating less than 69 gallons for gas 
storage water heaters and has a certified first hour rating less than 
128 gallons for oil storage water heaters.

[[Page 18790]]

    DOE is specifically seeking comment on one element of its proposed 
definition of solar-assisted fossil fuel storage water heaters that 
would limit solar-assisted water heaters to only those with the burner 
located in the upper half of the storage tank. DOE is aware of solar 
backup water heaters that have burners located in the upper portion of 
the tank but acknowledges that there are others that have burners 
located at the bottom of the water heater. The Department is concerned 
that water heaters with burners located at the bottom of the tank can 
be used as a household's main water heater without solar backup and 
should, therefore, be treated in the same manner as conventional water 
heaters with regards to standards. Thus, DOE seeks comment on the 
merits of this proposal.
    DOE also requests comment on other ways to define solar-assisted 
water heaters, including both definitional criteria not listed in the 
proposed definitions above and any performance-based criteria that 
might involve tests to determine whether the definition is met.
    Although water heaters meeting the definition of ``solar-assisted 
electric storage water heater'' or ``solar-assisted fossil fuel storage 
water heater'' remain covered products as water heaters, DOE proposes 
to clarify at 10 CFR 430.32(d) that these water heaters are not subject 
to the energy conservation standards currently specified in 10 CFR 
430.32(d). DOE also proposes to clarify that the test methods described 
in 10 CFR 430.23(e) are applicable to solar-assisted water heaters for 
purposes of representing their performance when described as a stand-
alone item (i.e., the backup tank portion only). When these water 
heaters are presented as part of a complete solar system that includes 
solar panels and any auxiliary equipment to move heat from the panels 
to the storage water heater, DOE believes that metrics commonly used by 
industry such as the Solar Energy Factor and Solar Fraction are most 
appropriate for representing the performance of the entire system. DOE 
seeks comment on the applicability of the uniform test method for 
measuring the energy consumption of water heaters to solar-assisted 
electric and fossil fuel storage water heaters.

IV. Procedural Issues and Regulatory Review

A. Review Under Executive Orders 12866 and 13563

    Section 1(b)(1) of Executive Order 12866, ``Regulatory Planning and 
Review,'' 58 FR 51735 (Oct. 4, 1993), requires each agency to identify 
the problem that it intends to address, including, where applicable, 
the failures of private markets or public institutions that warrant new 
agency action, as well as to assess the significance of that problem. 
The problems that the proposed standards address are as follows:
    (1) Insufficient information and the high costs of gathering and 
analyzing relevant information leads some consumers to miss 
opportunities to make cost-effective investments in energy efficiency.
    (2) In some cases the benefits of more efficient equipment are not 
realized due to misaligned incentives between purchasers and users. An 
example of such a case is when the equipment purchase decision is made 
by a building contractor or building owner who does not pay the energy 
costs.
    (3) There are external benefits resulting from improved energy 
efficiency of appliances that are not captured by the users of such 
equipment. These benefits include externalities related to public 
health, environmental protection, and national security that are not 
reflected in energy prices, such as reduced emissions of air pollutants 
and greenhouse gases that impact human health and global warming.
    In addition, this regulatory action is not an ``economically 
significant regulatory action'' under section 3(f)(1) of Executive 
Order 12866. Accordingly, DOE is not required under section 6(a)(3) of 
the Executive Order to prepare a regulatory impact analysis (RIA) on 
this rule and the Office of Information and Regulatory Affairs (OIRA) 
in the Office of Management and Budget (OMB) is not required to review 
this rule.
    DOE has also reviewed this regulation pursuant to Executive Order 
13563. 76 FR 3281 (Jan. 21, 2011). Executive Order 13563 is 
supplemental to and explicitly reaffirms the principles, structures, 
and definitions governing regulatory review established in Executive 
Order 12866. To the extent permitted by law, agencies are required by 
Executive Order 13563 to: (1) Propose or adopt a regulation only upon a 
reasoned determination that its benefits justify its costs (recognizing 
that some benefits and costs are difficult to quantify); (2) tailor 
regulations to impose the least burden on society, consistent with 
obtaining regulatory objectives, taking into account, among other 
things, and to the extent practicable, the costs of cumulative 
regulations; (3) select, in choosing among alternative regulatory 
approaches, those approaches that maximize net benefits (including 
potential economic, environmental, public health and safety, and other 
advantages; distributive impacts; and equity); (4) to the extent 
feasible, specify performance objectives, rather than specifying the 
behavior or manner of compliance that regulated entities must adopt; 
and (5) identify and assess available alternatives to direct 
regulation, including providing economic incentives to encourage the 
desired behavior, such as user fees or marketable permits, or providing 
information upon which choices can be made by the public.
    DOE emphasizes as well that Executive Order 13563 requires agencies 
to use the best available techniques to quantify anticipated present 
and future benefits and costs as accurately as possible. In its 
guidance, the Office of Information and Regulatory Affairs has 
emphasized that such techniques may include identifying changing future 
compliance costs that might result from technological innovation or 
anticipated behavioral changes. For the reasons stated in the preamble, 
DOE believes that this NOPR is consistent with these principles, 
including the requirement that, to the extent permitted by law, 
benefits justify costs and that net benefits are maximized.

B. Review Under the Regulatory Flexibility Act

    The Regulatory Flexibility Act (5 U.S.C. 601 et seq.) requires 
preparation of an initial regulatory flexibility analysis (IRFA) for 
any rule that by law must be proposed for public comment, unless the 
agency certifies that the rule, if promulgated, will not have a 
significant economic impact on a substantial number of small entities. 
As required by Executive Order 13272, ``Proper Consideration of Small 
Entities in Agency Rulemaking,'' 67 FR 53461 (August 16, 2002), DOE 
published procedures and policies on February 19, 2003, to ensure that 
the potential impacts of its rules on small entities are properly 
considered during the rulemaking process. 68 FR 7990. DOE has made its 
procedures and policies available on the Office of the General 
Counsel's Web site (http://energy.gov/gc/office-general-counsel).
    For manufacturers of residential water heaters, the Small Business 
Administration (SBA) has set a size threshold, which defines those 
entities classified as ``small businesses'' for the purposes of the 
statute. DOE used the SBA's small business size standards to determine 
whether any small entities would be subject to the requirements of the 
rule. 65 FR 30836, 30848 (May 15, 2000), as amended at 65 FR 53533, 
53544 (Sept. 5, 2000) and codified at 13

[[Page 18791]]

CFR part 121.The size standards are listed by North American Industry 
Classification System (NAICS) code and industry description and are 
available at http://www.sba.gov/sites/default/files/files/Size_Standards_Table.pdf. Residential water heater manufacturing is 
classified under NAICS 335228, ``Other Major Household Appliance 
Manufacturing.'' The SBA sets a threshold of 500 employees or less for 
an entity to be considered as a small business for this category.
    To estimate the number of companies that could be small business 
manufacturers of solar-assisted water heaters covered by this 
rulemaking, DOE constructed a list of residential water heater 
manufacturers by conducting a market survey using publicly available 
information. DOE's research involved industry trade association 
membership directories (including AHRI), information from previous 
rulemakings, individual company Web sites, SBA's database, and market 
research tools (e.g., Hoover's reports). DOE used the Solar Rating and 
Certification Corporation's certification database as well as 
individual company Web sites to determine which residential water 
heater manufacturers identified offer solar-assisted products and would 
potentially be impacted by this proposed rule. DOE screened out 
companies that do not offer products covered by this rulemaking, do not 
meet the definition of a ``small business,'' or are completely foreign 
owned and operated.
    DOE initially identified eight manufacturers of solar-assisted 
water heaters sold in the United States. After reviewing publicly 
available information on these potential residential water heater 
manufacturers, DOE determined that five were either large manufacturers 
or manufacturers that were completely foreign owned and operated. Based 
on these efforts, DOE estimated that there are three small business 
manufacturers of water heaters that meet the definition of solar-
assisted electric storage water heater or solar-assisted fossil fuel 
water heater, as proposed in this NOPR.
    DOE is not proposing any amended standards for residential water 
heater manufacturers in this NOPR. Rather, the Department proposes to 
define solar-assisted electric storage water heaters and solar-assisted 
fossil fuel-fired storage water heaters, and to clarify that current 
residential water heater standards do not apply to such products. As a 
result, DOE certifies that this NOPR will not have a significant 
economic impact on a substantial number of small entities and 
therefore, has not prepared an IRFA. DOE will transmit this 
certification to the Chief Counsel for Advocacy of the Small Business 
Administration (SBA) for review under 5 U.S.C 605(b).
    A statement of the objectives of, and reasons and legal basis for, 
the proposed rule are set forth elsewhere in the preamble and not 
repeated here.

C. Review Under the Paperwork Reduction Act

    Manufacturers of residential water heaters must certify to DOE that 
their products comply with any applicable energy conservation 
standards. In certifying compliance, manufacturers must test their 
products according to the DOE test procedures for residential water 
heaters, including any amendments adopted for those test procedures. 
DOE has established regulations for the certification and recordkeeping 
requirements for all covered consumer products and commercial 
equipment, including residential water heaters. 76 FR 12422 (March 7, 
2011). The collection-of-information requirement for the certification 
and recordkeeping is subject to review and approval by OMB under the 
Paperwork Reduction Act (PRA). This requirement has been approved by 
OMB under OMB control number 1910-1400. Public reporting burden for the 
certification is estimated to average 30 hours per response, including 
the time for reviewing instructions, searching existing data sources, 
gathering and maintaining the data needed, and completing and reviewing 
the collection of information.
    Notwithstanding any other provision of the law, no person is 
required to respond to, nor shall any person be subject to a penalty 
for failure to comply with, a collection of information subject to the 
requirements of the PRA, unless that collection of information displays 
a currently valid OMB Control Number.
    This proposal clarifies the applicability of the amended energy 
conservation standards to solar-assisted water heaters and thus, also 
clarifies the certification requirements. If the proposal is finalized 
as proposed, those water heaters meeting the definition of solar-
assisted in DOE's regulations would not have to be certified with the 
Department because they would not be subject to standards.

D. Review Under the National Environmental Policy Act of 1969

    Pursuant to the National Environmental Policy Act (NEPA) of 1969, 
DOE has determined that the proposed rule fits within the category of 
actions included in Categorical Exclusion (CX) B5.1 and otherwise meets 
the requirements for application of a CX. See 10 CFR part 1021, App. B, 
B5.1(b); 1021.410(b) and Appendix B, B(1)-(5). The proposed rule fits 
within the category of actions because it is a rulemaking that 
clarifies the applicability of energy conservation standards for 
consumer products, and for which none of the exceptions identified in 
CX B5.1(b) apply. Therefore, DOE has made a CX determination for this 
rulemaking, and DOE does not need to prepare an Environmental 
Assessment or Environmental Impact Statement for this proposed rule. 
DOE's CX determination for this proposed rule is available at http://cxnepa.energy.gov/.

E. Review Under Executive Order 13132

    Executive Order 13132, ``Federalism.'' 64 FR 43255 (Aug. 10, 1999) 
imposes certain requirements on Federal agencies formulating and 
implementing policies or regulations that preempt State law or that 
have Federalism implications. The Executive Order requires agencies to 
examine the constitutional and statutory authority supporting any 
action that would limit the policymaking discretion of the States and 
to carefully assess the necessity for such actions. The Executive Order 
also requires agencies to have an accountable process to ensure 
meaningful and timely input by State and local officials in the 
development of regulatory policies that have Federalism implications. 
On March 14, 2000, DOE published a statement of policy describing the 
intergovernmental consultation process it will follow in the 
development of such regulations. 65 FR 13735. EPCA governs and 
prescribes Federal preemption of State regulations as to energy 
conservation for the products that are the subject of this proposed 
rule. States can petition DOE for exemption from such preemption to the 
extent, and based on criteria, set forth in EPCA. (42 U.S.C. 6297) No 
further action is required by Executive Order 13132.

F. Review Under Executive Order 12988

    With respect to the review of existing regulations and the 
promulgation of new regulations, section 3(a) of Executive Order 12988, 
``Civil Justice Reform,'' imposes on Federal agencies the general duty 
to adhere to the following requirements: (1) Eliminate drafting errors 
and ambiguity; (2) write regulations to minimize litigation; and (3) 
provide a clear legal standard for affected conduct rather than a 
general standard and promote simplification

[[Page 18792]]

and burden reduction. 61 FR 4729 (Feb. 7, 1996). Section 3(b) of 
Executive Order 12988 specifically requires that Executive agencies 
make every reasonable effort to ensure that the regulation: (1) Clearly 
specifies the preemptive effect, if any; (2) clearly specifies any 
effect on existing Federal law or regulation; (3) provides a clear 
legal standard for affected conduct while promoting simplification and 
burden reduction; (4) specifies the retroactive effect, if any; (5) 
adequately defines key terms; and (6) addresses other important issues 
affecting clarity and general draftsmanship under any guidelines issued 
by the Attorney General. Section 3(c) of Executive Order 12988 requires 
Executive agencies to review regulations in light of applicable 
standards in section 3(a) and section 3(b) to determine whether they 
are met or it is unreasonable to meet one or more of them. DOE has 
completed the required review and determined that, to the extent 
permitted by law, this proposed rule meets the relevant standards of 
Executive Order 12988.

G. Review Under the Unfunded Mandates Reform Act of 1995

    Title II of the Unfunded Mandates Reform Act of 1995 (UMRA) 
requires each Federal agency to assess the effects of Federal 
regulatory actions on State, local, and Tribal governments and the 
private sector. Public Law 104-4, sec. 201 (codified at 2 U.S.C. 1531). 
For a proposed regulatory action likely to result in a rule that may 
cause the expenditure by State, local, and Tribal governments, in the 
aggregate, or by the private sector of $100 million or more in any one 
year (adjusted annually for inflation), section 202 of UMRA requires a 
Federal agency to publish a written statement that estimates the 
resulting costs, benefits, and other effects on the national economy. 
(2 U.S.C. 1532(a), (b)) The UMRA also requires a Federal agency to 
develop an effective process to permit timely input by elected officers 
of State, local, and Tribal governments on a proposed ``significant 
intergovernmental mandate,'' and requires an agency plan for giving 
notice and opportunity for timely input to potentially affected small 
governments before establishing any requirements that might 
significantly or uniquely affect small governments. On March 18, 1997, 
DOE published a statement of policy on its process for 
intergovernmental consultation under UMRA. 62 FR 12820. DOE's policy 
statement is also available at http://energy.gov/gc/office-general-counsel.
    This proposed rule does not contain a Federal intergovernmental 
mandate, and will not require expenditures of $100 million or more on 
the private sector. Accordingly, no further action is required under 
the UMRA.

H. Review Under the Treasury and General Government Appropriations Act, 
1999

    Section 654 of the Treasury and General Government Appropriations 
Act, 1999 (Pub. L. 105-277) requires Federal agencies to issue a Family 
Policymaking Assessment for any rule that may affect family well-being. 
This rule would not have any impact on the autonomy or integrity of the 
family as an institution. Accordingly, DOE has concluded that it is not 
necessary to prepare a Family Policymaking Assessment.

I. Review Under Executive Order 12630

    DOE has determined, under Executive Order 12630, ``Governmental 
Actions and Interference with Constitutionally Protected Property 
Rights'' 53 FR 8859 (Mar. 18, 1988), that this regulation would not 
result in any takings that might require compensation under the Fifth 
Amendment to the U.S. Constitution.

J. Review Under the Treasury and General Government Appropriations Act, 
2001

    Section 515 of the Treasury and General Government Appropriations 
Act, 2001 (44 U.S.C. 3516, note) provides for Federal agencies to 
review most disseminations of information to the public under 
guidelines established by each agency pursuant to general guidelines 
issued by OMB. OMB's guidelines were published at 67 FR 8452 (Feb. 22, 
2002), and DOE's guidelines were published at 67 FR 62446 (Oct. 7, 
2002). DOE has reviewed this NOPR under the OMB and DOE guidelines and 
has concluded that it is consistent with applicable policies in those 
guidelines.

K. Review Under Executive Order 13211

    Executive Order 13211, ``Actions Concerning Regulations That 
Significantly Affect Energy Supply, Distribution, or Use'' 66 FR 28355 
(May 22, 2001), requires Federal agencies to prepare and submit to OIRA 
at OMB, a Statement of Energy Effects for any proposed significant 
energy action. A ``significant energy action'' is defined as any action 
by an agency that promulgates or is expected to lead to promulgation of 
a final rule, and that: (1) Is a significant regulatory action under 
Executive Order 12866, or any successor order; and (2) is likely to 
have a significant adverse effect on the supply, distribution, or use 
of energy, or (3) is designated by the Administrator of OIRA as a 
significant energy action. For any proposed significant energy action, 
the agency must give a detailed statement of any adverse effects on 
energy supply, distribution, or use should the proposal be implemented, 
and of reasonable alternatives to the action and their expected 
benefits on energy supply, distribution, and use.
    DOE has tentatively concluded that this regulatory action, which 
clarifies applicability of the energy conservation standards for 
residential water heaters, is not a significant energy action because 
the proposed clarifications are not likely to have a significant 
adverse effect on the supply, distribution, or use of energy, nor has 
it been designated as such by the Administrator at OIRA. Accordingly, 
DOE has not prepared a Statement of Energy Effects on the proposed 
rule.

L. Review Under the Information Quality Bulletin for Peer Review

    On December 16, 2004, OMB, in consultation with the Office of 
Science and Technology Policy (OSTP), issued its Final Information 
Quality Bulletin for Peer Review (the Bulletin). 70 FR 2664 (Jan. 14, 
2005). The Bulletin establishes that certain scientific information 
shall be peer reviewed by qualified specialists before it is 
disseminated by the Federal Government, including influential 
scientific information related to agency regulatory actions. The 
purpose of the bulletin is to enhance the quality and credibility of 
the Government's scientific information. Under the Bulletin, the energy 
conservation standards rulemaking analyses are ``influential scientific 
information,'' which the Bulletin defines as scientific information the 
agency reasonably can determine will have, or does have, a clear and 
substantial impact on important public policies or private sector 
decisions. 70 FR 2667.
    In response to OMB's Bulletin, DOE conducted formal in-progress 
peer reviews of the energy conservation standards development process 
and analyses and has prepared a Peer Review Report pertaining to the 
energy conservation standards rulemaking analyses. Generation of this 
report involved a rigorous, formal, and documented evaluation using 
objective criteria and qualified and independent reviewers to make a 
judgment as to the technical/scientific/business merit, the actual or 
anticipated results, and the productivity and management effectiveness 
of programs and/or projects. The ``Energy Conservation

[[Page 18793]]

Standards Rulemaking Peer Review Report'' dated February 2007 has been 
disseminated and is available at the following Web site: 
www1.eere.energy.gov/buildings/appliance_standards/peer_review.html.

V. Public Participation

    DOE welcomes all interested parties to submit in writing by May 8, 
2015 comments, data, and other information on matters addressed in this 
proposal and on other matters relevant to consideration of definitions 
for residential water heaters.
    After the closing of the comment period, DOE will consider all 
timely-submitted comments and additional information obtained from 
interested parties, as well as information obtained through further 
analyses. Afterward, DOE will publish either supplemental notice of 
proposed rulemaking or a final rule amending these definitions and 
clarifying the applicability of standards. The final rule would include 
definitions for the products covered by the rulemaking.

A. Submission of Comments

    DOE will accept comments, data, and information regarding this 
proposed rule no later than the date provided in the DATES section at 
the beginning of this proposed rule. Interested parties may submit 
comments, data, and other information using any of the methods 
described in the ADDRESSES section at the beginning of this notice.
    Submitting comments via regulations.gov. The regulations.gov Web 
page will require you to provide your name and contact information. 
Your contact information will be viewable to DOE Building Technologies 
staff only. Your contact information will not be publicly viewable 
except for your first and last names, organization name (if any), and 
submitter representative name (if any). If your comment is not 
processed properly because of technical difficulties, DOE will use this 
information to contact you. If DOE cannot read your comment due to 
technical difficulties and cannot contact you for clarification, DOE 
may not be able to consider your comment.
    However, your contact information will be publicly viewable if you 
include it in the comment itself or in any documents attached to your 
comment. Any information that you do not want to be publicly viewable 
should not be included in your comment, nor in any document attached to 
your comment. Otherwise, persons viewing comments will see only first 
and last names, organization names, correspondence containing comments, 
and any documents submitted with the comments.
    Do not submit to regulations.gov information for which disclosure 
is restricted by statute, such as trade secrets and commercial or 
financial information (hereinafter referred to as Confidential Business 
Information (CBI)). Comments submitted through regulations.gov cannot 
be claimed as CBI. Comments received through the Web site will waive 
any CBI claims for the information submitted. For information on 
submitting CBI, see the Confidential Business Information section 
below.
    DOE processes submissions made through regulations.gov before 
posting. Normally, comments will be posted within a few days of being 
submitted. However, if large volumes of comments are being processed 
simultaneously, your comment may not be viewable for up to several 
weeks. Please keep the comment tracking number that regulations.gov 
provides after you have successfully uploaded your comment.
    Submitting comments via email, hand delivery/courier, or mail. 
Comments and documents submitted via email, hand delivery, or mail also 
will be posted to regulations.gov. If you do not want your personal 
contact information to be publicly viewable, do not include it in your 
comment or any accompanying documents. Instead, provide your contact 
information in a cover letter. Include your first and last names, email 
address, telephone number, and optional mailing address. The cover 
letter will not be publicly viewable as long as it does not include any 
comments
    Include contact information each time you submit comments, data, 
documents, and other information to DOE. If you submit via mail or hand 
delivery/courier, please provide all items on a CD, if feasible. It is 
not necessary to submit printed copies. No facsimiles (faxes) will be 
accepted.
    Comments, data, and other information submitted to DOE 
electronically should be provided in PDF (preferred), Microsoft Word or 
Excel, WordPerfect, or text (ASCII) file format. Provide documents that 
are not secured, that are written in English, and that are free of any 
defects or viruses. Documents should not contain special characters or 
any form of encryption and, if possible, they should carry the 
electronic signature of the author.
    Campaign form letters. Please submit campaign form letters by the 
originating organization in batches of between 50 to 500 form letters 
per PDF or as one form letter with a list of supporters' names compiled 
into one or more PDFs. This reduces comment processing and posting 
time.
    Confidential Business Information. According to 10 CFR 1004.11, any 
person submitting information that he or she believes to be 
confidential and exempt by law from public disclosure should submit via 
email, postal mail, or hand delivery/courier two well-marked copies: 
one copy of the document marked confidential including all the 
information believed to be confidential, and one copy of the document 
marked non-confidential with the information believed to be 
confidential deleted. Submit these documents via email or on a CD, if 
feasible. DOE will make its own determination about the confidential 
status of the information and treat it according to its determination.
    Factors of interest to DOE when evaluating requests to treat 
submitted information as confidential include: (1) A description of the 
items; (2) whether and why such items are customarily treated as 
confidential within the industry; (3) whether the information is 
generally known by or available from other sources; (4) whether the 
information has previously been made available to others without 
obligation concerning its confidentiality; (5) an explanation of the 
competitive injury to the submitting person which would result from 
public disclosure; (6) when such information might lose its 
confidential character due to the passage of time; and (7) why 
disclosure of the information would be contrary to the public interest.
    It is DOE's policy that all comments be included in the public 
docket, without change and as received, including any personal 
information provided in the comments (except information deemed to be 
exempt from public disclosure).

B. Issues on Which DOE Seeks Comment

    Although DOE welcomes comments on any aspect of this proposal, DOE 
is particularly interested in receiving comments and views of 
interested parties concerning the following issues:
    1. Are the criteria proposed to define solar-assisted water heaters 
sufficient to describe these types of water heaters?
    2. Are there alternative ways to define solar-assisted water 
heaters including additional prescriptive design criteria or 
performance-based criteria that might involve tests to determine 
whether the definition is met?
    3. Should a criterion be added to the definition of solar-assisted 
fossil fuel-fired water heaters that requires the burner to be located 
in the upper half of the tank?

[[Page 18794]]

    4. Is the uniform test method for measuring the energy consumption 
of water heaters appropriate for representing the performance of solar-
assisted electric and fossil fuel-fired storage water heaters?

VI. Approval of the Office of the Secretary

    The Secretary of Energy has approved publication of this proposed 
rule.

List of Subjects in 10 CFR Part 430

    Administrative practice and procedure, Confidential business 
information, Energy conservation, Household appliances, Imports, 
Intergovernmental relations, and Small businesses.

    Issued in Washington, DC, on March 25, 2015.
Roland Risser,
Acting Deputy Assistant Secretary for Energy Efficiency, Energy 
Efficiency and Renewable Energy.
    For the reasons set forth in the preamble, DOE proposes to amend 
part 430 of chapter II, subchapter D, of title 10 of the Code of 
Federal Regulations, as set forth below:

PART 430--ENERGY CONSERVATION PROGRAM FOR CONSUMER PRODUCTS

0
1. The authority citation for Part 430 continues to read as follows:

    Authority: 42 U.S.C. 6291-6309; 28 U.S.C. 2461 note.

0
2. Section 430.2 is amended by adding the definitions of ``solar-
assisted electric storage water heater'' and ``solar-assisted fossil 
fuel storage water heater'' in alphabetical order to read as follows:


Sec.  430.2  Definitions.

* * * * *

Solar-assisted electric storage water heater means a product that 
utilizes electricity to heat potable water for use outside the heater 
upon demand and--
    (1) stores water at a thermostatically controlled temperature with 
an input of 12 kilowatts or less;
    (2) has at least two threaded ports in addition to those used for 
introduction and delivery of potable water for the supply and return of 
water or a heat transfer fluid heated externally by solar panels;
    (3) does not have electric resistance heating elements located in 
the lower half of the storage tank;
    (4) has the temperature sensing device that controls the auxiliary 
electric heat source located in the upper half of the storage tank;
    (5) has a certified first hour rating less than 63 gallons.

Solar-assisted fossil fuel storage water heater means a product that 
utilizes oil or gas to heat potable water for use outside the heater 
upon demand and--
    (1) stores water at a thermostatically controlled temperature, 
including gas storage water heaters with an input of 75,000 Btu per 
hour or less and oil storage water heaters with an input of 105,000 Btu 
per hour or less;
    (2) has at least two threaded ports in addition to those used for 
introduction and delivery of potable water for the supply and return of 
water or a heat transfer fluid heated externally by solar panels;
    (3) has the burner located in the upper half of the storage tank;
    (4) has the temperature sensing device that controls the auxiliary 
heat source located in the upper half of the storage tank; and
    (5) has a certified first hour rating less than 69 gallons for gas 
storage water heaters and has a certified first hour rating less than 
128 gallons for oil storage water heaters.
* * * * *
0
3. Section 430.32 is amended by revising paragraph (d) to read as 
follows:


Sec.  430.32  Energy and water conservation standards and their 
compliance dates.

* * * * *
    (d) Water heaters. (1) The energy factor of water heaters shall not 
be less than the following for products manufactured on or after the 
indicated dates.

----------------------------------------------------------------------------------------------------------------
                                                               Energy factor as of    Energy factor as of April
           Product class                 Storage volume         January 20, 2004               16, 2015
----------------------------------------------------------------------------------------------------------------
Gas-fired Storage Water Heater.....  >=20 gallons and <=100  0.67 - (0.0019 x Rated  For tanks with a Rated
                                      gallons.                Storage Volume in       Storage Volume at or below
                                                              gallons).               55 gallons: EF = 0.675 -
                                                                                      (0.0015 x Rated Storage
                                                                                      Volume in gallons). For
                                                                                      tanks with a Rated Storage
                                                                                      Volume above 55 gallons:
                                                                                      EF = 0.8012 - (0.00078 x
                                                                                      Rated Storage Volume in
                                                                                      gallons).
Oil-fired Storage Water Heater.....  <=50 gallons..........  0.59 - (0.0019 x Rated  EF = 0.68 - (0.0019 x Rated
                                                              Storage Volume in       Storage Volume in
                                                              gallons).               gallons).
Electric Storage Water Heater......  >=20 gallons and <=120  0.97 - (0.00132 x       For tanks with a Rated
                                      gallons.                Rated Storage Volume    Storage Volume at or below
                                                              in gallons).            55 gallons: EF = 0.960 -
                                                                                      (0.0003 x Rated Storage
                                                                                      Volume in gallons). For
                                                                                      tanks with a Rated Storage
                                                                                      Volume above 55 gallons:
                                                                                      EF = 2.057 - (0.00113 x
                                                                                      Rated Storage Volume in
                                                                                      gallons).
Tabletop Water Heater..............  >=20 gallons and <=120  0.93 - (0.00132 x       EF = 0.93 - (0.00132 x
                                      gallons.                Rated Storage Volume    Rated Storage Volume in
                                                              in gallons).            gallons).
Instantaneous Gas-fired Water        <2 gallons............  0.62 - (0.0019 x Rated  EF = 0.82 - (0.0019 x Rated
 Heater.                                                      Storage Volume in       Storage Volume in
                                                              gallons).               gallons).
Instantaneous Electric Water Heater  <2 gallons............  0.93 - (0.00132 x       EF = 0.93 - (0.00132 x
                                                              Rated Storage Volume    Rated Storage Volume in
                                                              in gallons).            gallons).
----------------------------------------------------------------------------------------------------------------
NOTE: The Rated Storage Volume equals the water storage capacity of a water heater, in gallons, as certified by
  the manufacturer.

    (2) Exclusions: The energy conservation standards shown in 
paragraph (1) of this section do not apply to the following types of 
water heaters:
    (i) gas-fired, oil-fired, and electric water heaters at or above 2 
gallons storage volume and below 20 gallons storage volume;
    (ii) gas-fired water heaters above 100 gallons storage volume;
    (iii) oil-fired water heaters above 50 gallons storage volume;
    (iv) electric water heaters above 120 gallons storage volume;
    (v) gas-fired instantaneous water heaters at or below 50,000 Btu/h;
    (vi) solar-assisted electric storage water heaters; and

[[Page 18795]]

    (vii) solar-assisted fossil fuel storage water heaters.
* * * * *
[FR Doc. 2015-07956 Filed 4-7-15; 8:45 am]
BILLING CODE 6450-01-P


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